UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
ý ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 20142015
OR
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File No. 001-02217
(Exact name of Registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation or organization)
 
58-0628465
(IRS Employer Identification No.)
One Coca-Cola Plaza
Atlanta, Georgia
(Address of principal executive offices)
 
30313
(Zip Code)
Registrant's telephone number, including area code: (404) 676-2121
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
COMMON STOCK,Common Stock, $0.25 PAR VALUEPar Value NEW YORK STOCK EXCHANGENew York Stock Exchange
Floating Rate Notes Due 2017New York Stock Exchange
Floating Rate Notes Due 2019New York Stock Exchange
1.125% Notes Due 2022New York Stock Exchange
0.75% Notes Due 2023New York Stock Exchange
1.875% Notes Due 2026New York Stock Exchange
1.125% Notes Due 2027New York Stock Exchange
1.625% Notes Due 2035New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ý    No o
Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes o    No ý
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o
Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files). Yes ý    No o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer ý
 
Accelerated filer o
 
Non-accelerated filer o
 
Smaller reporting company o
(Do not check if a smaller reporting company)
Indicate by check mark if the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o    No ý
The aggregate market value of the common equity held by non-affiliates of the Registrant (assuming for these purposes, but without conceding, that all executive officers and Directors are "affiliates" of the Registrant) as of June 27, 2014,July 3, 2015, the last business day of the Registrant's most recently completed second fiscal quarter, was $183,965,638,496$170,318,198,405 (based on the closing sale price of the Registrant's Common Stock on that date as reported on the New York Stock Exchange).
The number of shares outstanding of the Registrant's Common Stock as of February 23, 2015,22, 2016, was 4,366,243,616.4,329,497,778.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Company's Proxy Statement for the Annual Meeting of Shareowners to be held on April 29, 2015,27, 2016, are incorporated by reference in Part III.




Table of Contents
  Page
 
Part I  
Part II  
Part III  
Part IV  
 





FORWARD-LOOKING STATEMENTS
This report contains information that may constitute "forward-looking statements." Generally, the words "believe," "expect," "intend," "estimate," "anticipate," "project," "will" and similar expressions identify forward-looking statements, which generally are not historical in nature. However, the absence of these words or similar expressions does not mean that a statement is not forward-looking. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future — including statements relating to volume growth, share of sales and earnings per share growth, and statements expressing general views about future operating results — are forward-looking statements. Management believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. Our Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our Company's historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to, those described in Part I, "Item 1A. Risk Factors" and elsewhere in this report and those described from time to time in our future reports filed with the Securities and Exchange Commission.
PART I
ITEM 1.    BUSINESS
In this report, the terms "The Coca-Cola Company," "Company," "we," "us" and "our" mean The Coca-Cola Company and all entities included in our consolidated financial statements.
General
The Coca-Cola Company is the world's largest beverage company. We own or license and market more than 500 nonalcoholic beverage brands, primarily sparkling beverages but also a variety of still beverages such as waters, enhanced waters, juices and juice drinks, ready-to-drink teas and coffees, and energy and sports drinks. We own and market four of the world's top five nonalcoholic sparkling beverage brands: Coca-Cola, Diet Coke, Fanta and Sprite. Finished beverage products bearing our trademarks, sold in the United States since 1886, are now sold in more than 200 countries.
We make our branded beverage products available to consumers throughout the world through our network of Company-owned or -controlled bottling and distribution operations as well as independent bottling partners, distributors, wholesalers and retailers — the world's largest beverage distribution system. Beverages bearing trademarks owned by or licensed to us account for more than 1.9 billion of the approximately 5758 billion servings of all beverages consumed worldwide every day.
We believe our success depends on our ability to connect with consumers by providing them with a wide variety of options to meet their desires, needs and lifestyles. Our success further depends on the ability of our people to execute effectively, every day.
Our goal is to use our Company's assets — our brands, financial strength, unrivaled distribution system, global reach, and the talent and strong commitment of our management and associates — to become more competitive and to accelerate growth in a manner that creates value for our shareowners.
We were incorporated in September 1919 under the laws of the State of Delaware and succeeded to the business of a Georgia corporation with the same name that had been organized in 1892.

1



Acquisition of Coca-Cola Enterprises Inc.'s Former North America Business and Related Transactions
On October 2, 2010, we acquired the former North America business of Coca-Cola Enterprises Inc. ("CCE"), one of our major bottlers, consisting of CCE's production, sales and distribution operations in the United States, Canada, the British Virgin Islands, the United States Virgin Islands and the Cayman Islands, and a substantial majority of CCE's corporate segment. CCE shareowners other than the Company exchanged their CCE common stock for common stock in a new entity named Coca-Cola Enterprises, Inc. ("New CCE"), which, after the closing of the transaction, continued to hold the European operations that had been held by CCE prior to the acquisition. The Company does not have any ownership interest in New CCE. Upon completion of the CCE transaction, we combined the management of the acquired North America business with the management of our existing foodservice business; Minute Maid and Odwalla juice businesses; North America supply chain operations; and Company-owned bottling operations in Philadelphia, Pennsylvania, into a unified bottling and customer service organization called Coca-Cola Refreshments ("CCR"). In addition, we reshaped our remaining Coca-Cola North America operations into an organization that primarily provided franchise leadership and consumer marketing and innovation for the North American market. Effective January 1, 2014, our North America business was restructured to consist of two operating units, Coca-Cola North America and CCR. Coca-Cola North America provides franchise leadership and consumer marketing and innovation and will also manage our foodservice operations. CCR manages our North America bottling operations and the product supply chain functions for the North American market. Our two North America operating units have distinct capabilities, responsibilities and strengths, but operate as a unified, aligned and agile organization.
In contemplation of the closing of our acquisition of CCE's former North America business, we reached an agreement with Dr Pepper Snapple Group, Inc. ("DPSG") to distribute certain DPSG brands in territories where DPSG brands had been distributed by CCE prior to the CCE transaction. Under the terms of our agreement with DPSG, concurrently with the closing of the CCE transaction, we entered into license agreements with DPSG to distribute Dr Pepper trademark brands in the United States, Canada Dry in the Northeastern United States, and Canada Dry and C' Plus in Canada, and we made a net one-time cash payment of $715 million to DPSG. Under the license agreements, the Company agreed to meet certain performance obligations to distribute DPSG products in retail and foodservice accounts and vending machines. The license agreements have initial terms of 20 years, with automatic 20-year renewal periods unless otherwise terminated under the terms of the agreements. The license agreements replaced agreements between DPSG and CCE existing immediately prior to the completion of the CCE transaction. In addition, we entered into an agreement with DPSG to include Dr Pepper and Diet Dr Pepper in our Coca-Cola Freestyle fountain dispensers in certain outlets throughout the United States. The Coca-Cola Freestyle agreement has a term of 20 years.
On October 2, 2010, we sold all of our ownership interests in Coca-Cola Drikker AS (the "Norwegian bottling operation") and Coca-Cola Drycker Sverige AB (the "Swedish bottling operation") to New CCE for $0.9 billion in cash.
Operating Segments
The Company's operating structure is the basis for our internal financial reporting. As of December 31, 20142015, our operating structure included the following operating segments, the first six of which are sometimes referred to as "operating groups" or "groups":
Eurasia and Africa
Europe
Latin America
North America
Asia Pacific
Bottling Investments
Corporate
Except to the extent that differences among operating segments are material to an understanding of our business taken as a whole, the description of our business in this report is presented on a consolidated basis. Effective January 1, 2016, we transferred Coca-Cola Refreshments' ("CCR") bottling and associated supply chain operations in the United States and Canada from our North America segment to our Bottling Investments segment.
For financial information about our operating segments and geographic areas, refer to Note 19 of Notes to Consolidated Financial Statements set forth in Part II, "Item 8. Financial Statements and Supplementary Data" of this report, incorporated herein by reference. For certain risks attendant to our non-U.S. operations, refer to "Item 1A. Risk Factors" below.

2



Products and Brands
As used in this report:
"concentrates" means flavoring ingredients and, depending on the product, sweeteners used to prepare syrups or finished beverages and includes powders for purified water products such as Dasani;
"syrups" means beverage ingredients produced by combining concentrates and, depending on the product, sweeteners and added water;
"fountain syrups" means syrups that are sold to fountain retailers, such as restaurants and convenience stores, which use dispensing equipment to mix the syrups with sparkling or still water at the time of purchase to produce finished beverages that are served in cups or glasses for immediate consumption;
"sparkling beverages" means nonalcoholic ready-to-drink beverages with carbonation, including carbonated energy drinks and carbonated waters and flavored waters;
"still beverages" means nonalcoholic beverages without carbonation, including noncarbonated waters, flavored waters and enhanced waters, noncarbonated energy drinks, juices and juice drinks, ready-to-drink teas and coffees, and sports drinks;
"Company Trademark Beverages" means beverages bearing our trademarks and certain other beverage products bearing trademarks licensed to us by third parties for which we provide marketing support and from the sale of which we derive economic benefit; and
"Trademark Coca-Cola Beverages" or "Trademark Coca-Cola" means beverages bearing the trademark Coca-Cola or any trademark that includes Coca-Cola or Coke (that is, Coca-Cola, Coca-Cola Life, Diet Coke and Coca-Cola Zero and all their variations and any line extensions, including Coca-Cola Light, caffeine free Diet Coke, Cherry Coke, etc.). Likewise, when we use the capitalized word "Trademark" together with the name of one of our other beverage products (such as "Trademark Fanta," "Trademark Sprite" or "Trademark Simply"), we mean beverages bearing the indicated trademark (that is, Fanta, Sprite or Simply, respectively) and all its variations and line extensions (such that "Trademark Fanta" includes Fanta Orange, Fanta Zero Orange, Fanta Apple, etc.; "Trademark Sprite" includes Sprite, Diet Sprite, Sprite Zero, Sprite Light, etc.; and "Trademark Simply" includes Simply Orange, Simply Apple, Simply Grapefruit, etc.).

2



Our Company markets, manufactures and sells:
beverage concentrates, sometimes referred to as "beverage bases," and syrups, including fountain syrups (we refer to this part of our business as our "concentrate business" or "concentrate operations"); and
finished sparkling and still beverages (we refer to this part of our business as our "finished product business" or "finished product operations").
Generally, finished product operations generate higher net operating revenues but lower gross profit margins than concentrate operations.
In our concentrate operations, we typically generate net operating revenues by selling concentrates and syrups to authorized bottling and canning operations (to which we typically refer as our "bottlers" or our "bottling partners"). Our bottling partners either combine the concentrates with sweeteners (depending on the product), still water and/or sparkling water, or combine the syrups with sparkling water to produce finished beverages. The finished beverages are packaged in authorized containers — such as cans and refillable and nonrefillable glass and plastic bottles — bearing our trademarks or trademarks licensed to us and are then sold to retailers directly or, in some cases, through wholesalers or other bottlers. Outside the United States, we also sell concentrates for fountain beverages to our bottling partners who are typically authorized to manufacture fountain syrups, which they sell to fountain retailers such as restaurants and convenience stores which use the fountain syrups to produce beverages for immediate consumption, or to authorized fountain wholesalers who in turn sell and distribute the fountain syrups to fountain retailers.

3



Our finished product operations consist primarily of our Company-owned or -controlled bottling, sales and distribution operations, including CCR. Our Company-owned or -controlled bottling, sales and distribution operations, other than CCR, are included in our Bottling Investments operating segment. CCR is included in our North America operating segment. Our finished product operations generate net operating revenues by selling sparkling beverages and a variety of still beverages, such as juices and juice drinks, energy and sports drinks, ready-to-drink teas and coffees, and certain water products, to retailers or to distributors, wholesalers and bottling partners who distribute them to retailers. In addition, in the United States, we manufacture fountain syrups and sell them to fountain retailers, such as restaurants and convenience stores who use the fountain syrups to produce beverages for immediate consumption, or to authorized fountain wholesalers or bottling partners who resell the fountain syrups to fountain retailers. In the United States, we authorize wholesalers to resell our fountain syrups through nonexclusive appointments that neither restrict us in setting the prices at which we sell fountain syrups to the wholesalers nor restrict the territories in which the wholesalers may resell in the United States.
For information about net operating revenues and unit case volume related to our concentrate operations and finished product operations, refer to the heading "Our Business — General" set forth in Part II, "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" of this report, which is incorporated herein by reference.
We own numerous valuable nonalcoholic beverage brands, including the following:
Coca-ColaMinute MaidAquariusBonaqua/Bonaqa
Diet Coke/Coca-Cola Light
Georgia1
Minute Maid Pulpy4
AyatakaGold Peak56
Coca-Cola ZeroPoweradeDasani
Gold PeakFUZE TEA67
Fanta
Del Valle2
Simply45
I LOHASGlacéau Smartwater78
Sprite
Schweppes3
Glacéau Vitaminwater
FUZE TEAIce Dew89
1 
Georgia is primarily a coffee brand sold mainly in Japan.
2 
We manufacture, market and sell juices and juice drinks under the Del Valle trademark primarily in Mexico and Brazil through joint ventures with our bottling partners.
3 
Schweppes is owned by the Company in certain countries other than the United States.
4 
Minute Maid Pulpy is a juice drink brand sold primarily in Asia Pacific.
5
Simply is a juice and juice drink brand sold in North America.
5
Ayataka is a green tea brand sold in Japan.
6 
Gold Peak is primarily a tea brand sold in North America.
7 
I LOHASFUZE TEA is a water brand sold in Japan.outside of North America.
8 
FUZE TEAGlacéau Smartwater is a vapor-distilled water with added electrolytes which is sold mainly in North America and Great Britain.
9
Ice Dew is a water brand sold outside of North America.in China.

In February 2014, we entered into a 10-year global strategic agreement with Green Mountain Coffee Roasters, Inc., now known as Keurig Green Mountain, Inc. (“Keurig”), to collaborate on the development and introduction of our global brand portfolio for use in Keurig’s forthcoming Keurig KoldTM at-home beverage system. Under the agreement, we and Keurig will cooperate to bring the Keurig KoldTM beverage system to consumers around the world, and Keurig will be our exclusive partner for the production and sale of our branded single-serve, pod-based cold beverages. Together, we and Keurig will also explore other future opportunities to collaborate on the Keurig® platform. For more information regarding our global strategic agreement with Keurig and related transactions, refer to Note 2 of Notes to Consolidated Financial Statements set forth in Part II "Item 8. Financial Statements and Supplementary Data" of this report.
3



In addition to the beverage brands we own, we also provide marketing support and otherwise participate in the sales of other nonalcoholic beverage brands through licenses, joint ventures and strategic partnerships, including, but not limited to, the following:
We and certain of our bottlers distribute certain brands of Monster Beverage Corporation ("Monster"), primarily Monster Energy, in designated territories in the United States, Canada and other international territories pursuant to distribution coordination agreements between the Company and Monster and related distribution agreements between Monster and Company-owned or -controlled bottling operations, including CCR, and independent bottling and distribution partners.
We produce and/or distribute certain other third-party brands, including DPSG brands owned by Dr Pepper Snapple Group, Inc. ("DPSG"), which we produce and distribute in designated territories in the United States and Canada pursuant to license agreements with DPSG.
We have a joint venture with Nestlé S.A. ("Nestlé") named Beverage Partners Worldwide ("BPW") which markets and distributes Nestea products in Europe, Canada and Australia under agreements with our bottlers. The Nestea trademark is owned by Société des Produits Nestlé S.A.
We have a strategic partnership with Aujan Industries Company J.S.C. (“Aujan”("Aujan"), one of the largest independent beverage companies in the Middle East. We own 50 percent of the entity that holds the rights in certain territories to brands produced and distributed by Aujan, including Rani, a juice brand, and Barbican, a flavored malt beverage brand.

4



We distribute certain brands of Monsterhave a joint venture with Nestlé S.A. ("Nestlé") named Beverage Corporation (“Monster”Partners Worldwide ("BPW"), primarily Monster Energy, which markets and distributes Nestea products in designated territories in the United StatesEurope and Canada and certain of our bottlers distribute such Monster brands in designated U.S. and international territories pursuant to distribution coordinationunder agreements with Monster and related distribution agreements between Monster and Company-owned or -controlled bottling operations and bottling and distribution partners. In August 2014, we entered into definitive agreements with Monster for a long-term strategic relationship in the global energy drink category pursuant to which, subject to the terms and conditions of the agreements, among other things, we will transfer our global energy drink business to Monster, and Monster will transfer its non-energy drink business to us; and we will amend our current distribution coordination agreements with Monster to expand distribution of Monster products into additional territories pursuant to long-term agreements with the Company's existing network of Company-owned or -controlled bottling operations and bottling and distribution partners. For more information regarding our agreements with Monster and related transactions, refer to Note 2 of Notes to Consolidated Financial Statements set forth in Part II, "Item 8. Financial Statements and Supplementary Data" of this report.bottlers. The Nestea trademark is owned by Société des Produits Nestlé S.A.
Consumer demand determines the optimal menu of Company product offerings. Consumer demand can vary from one locale to another and can change over time within a single locale. Employing our business strategy, and with special focus on core brands, our Company seeks to build its existing brands and, at the same time, to broaden its historical family of brands, products and services in order to create and satisfy consumer demand locale by locale.
We measure the volume of Company beverage products sold in two ways: (1) unit cases of finished products and (2) concentrate sales. As used in this report, "unit case" means a unit of measurement equal to 192 U.S. fluid ounces of finished beverage (24 eight-ounce servings);, and "unit case volume" means the number of unit cases (or unit case equivalents) of Company beverage products directly or indirectly sold by the Company and its bottling partners (the "Coca-Cola("Coca-Cola system") to customers. Unit case volume primarily consists of beverage products bearing Company trademarks. Also included in unit case volume are certain products licensed to, or distributed by, our Company, and brands owned by Coca-Cola system bottlers for which our Company provides marketing support and from the sale of which we derive economic benefit. In addition, unit case volume includes sales by certain joint ventures in which the Company has an equity interest. We believe unit case volume is one of the measures of the underlying strength of the Coca-Cola system because it measures trends at the consumer level. The unit case volume numbers used in this report are derived based on estimates received by the Company from its bottling partners and distributors. Concentrate sales volume represents the amount of concentrates and syrups (in all casesinstances expressed in equivalent unit cases) sold by, or used in finished beverages sold by, the Company to its bottling partners or other customers. Unit case volume and concentrate sales volume growth rates are not necessarily equal during any given period. Factors such as seasonality, bottlers' inventory practices, supply point changes, timing of price increases, new product introductions and changes in product mix can impact unit case volume and concentrate sales volume and can create differences between unit case volume and concentrate sales volume growth rates. In addition to the items mentioned above, the impact of unit case volume from certain joint ventures in which the Company has an equity interest but to which the Company does not sell concentrates or syrups may give rise to differences between unit case volume and concentrate sales volume growth rates.
Distribution System and Bottler's Agreements
We make our branded beverage products available to consumers in more than 200 countries through our network of Company-owned or -controlled bottling and distribution operations, as well as independent bottling partners, distributors, wholesalers and retailers — the world's largest beverage distribution system. Consumers enjoy finished beverage products bearing trademarks owned by or licensed to us at a rate of more than 1.9 billion servings each day. We continue to expand our marketing presence in an effort to increase our unit case volume and net operating revenues in developed, developing and emerging markets. Our strong and stable system helps us to capture growth by manufacturing, distributing and marketing existing, enhanced and new innovative products to our consumers throughout the world.

4



The Coca-Cola system sold 29.2 billion, 28.6 billion 28.2 billion and 27.728.2 billion unit cases of our products in 2015, 2014 2013 and 2012,2013, respectively. The numberunit case volume for 2015 and 2014 reflects the impact of unit cases soldthe transfer of distribution rights with respect to non-Company-owned brands that were previously licensed to us in 2014 does not include certain licensed beverage brands sold in the North American refranchised territories and the discontinuance of certain brands owned by our Russian juice company in connection with the transition in 2014 of our Russian juice operations to an existing joint venture with an unconsolidated bottling partner (for information about these structural changes, refer to the heading "Operations Review — Structural Changes, Acquired Brands and Newly Licensed Brands" set forth in Part II, "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" of this report). The Company eliminated the unit case volume related to these structural changes from the base year, whereas applicable, when calculating 2015 versus 2014 and 2014 versus 2013 unit case volume growth rates. Sparkling beverages represented 73 percent, 7473 percent and 7574 percent of our worldwide unit case volume for 2015, 2014 2013 and 2012,2013, respectively. Trademark Coca-Cola Beverages accounted for 46 percent, 4746 percent and 4847 percent of our worldwide unit case volume for 2015, 2014 and 2013, and 2012, respectively.

5



In 2014,2015, unit case volume in the United States ("U.S. unit case volume") represented 19 percent of the Company's worldwide unit case volume. Of the U.S. unit case volume for 2014, 682015, 67 percent was attributable to sparkling beverages and 3233 percent to still beverages. Trademark Coca-Cola Beverages accounted for 4544 percent of U.S. unit case volume for 2014.2015.
Unit case volume outside the United States represented 81 percent of the Company's worldwide unit case volume for 2014.2015. The countries outside the United States in which our unit case volumes were the largest in 20142015 were Mexico, China, Brazil and Japan, which together accounted for 31 percent of our worldwide unit case volume. Of the non-U.S. unit case volume for 2014,2015, 74 percent was attributable to sparkling beverages and 26 percent to still beverages. Trademark Coca-Cola Beverages accounted for 4746 percent of non-U.S. unit case volume for 2014.2015.
Our five largest independent bottling partners based on unit case volume in 20142015 were:
Coca-Cola FEMSA, S.A.B. de C.V. (“("Coca-Cola FEMSA”FEMSA"), which has bottling and distribution operations in a substantial partportion of central Mexico, including Mexico City, and the southeast and northeast parts of Mexico; greater São Paulo, Campinas, Santos,Mexico, including the state of Mato Grosso do Sul, the state of Paraná, part of the state of Goiás, part of the state of Rio de Janeiro and part of the state of Minas Gerais in Brazil;Gulf region; Guatemala City and the surrounding areas in Guatemala; Nicaragua (nationwide); Costa Rica (nationwide); Panama (nationwide); most of Colombia; allVenezuela (nationwide); a major part of Costa Rica, Nicaragua, Panamathe states of São Paulo and Venezuela; greaterMinas Gerais, the states of Paraná and Mato Grosso do Sul and part of the states of Rio de Janeiro and Goiás in Brazil; Buenos Aires and surrounding areas in Argentina; and all of the Philippines;Philippines (nationwide);
Coca-Cola HBC AG (“("Coca-Cola Hellenic”Hellenic"), which has bottling and distribution operations in Armenia, Austria, Belarus, Bosnia-Herzegovina, Bulgaria, Croatia, Cyprus, the Czech Republic, Estonia, the Former Yugoslav Republic of Macedonia, Greece, Hungary, Italy, Latvia, Lithuania, Moldova, Montenegro, Nigeria, Northern Ireland, Poland, Republic of Ireland, Romania, Russia, Serbia, Slovakia, Slovenia, Switzerland and Ukraine;
Arca Continental, S.A.B. de C.V., which has bottling and distribution operations in northern and western Mexico, northern Argentina, Ecuador and northern Argentina;Peru;
New CCE,Coca-Cola Enterprises, Inc. ("CCE"), which has bottling and distribution operations in Belgium, continental France, Great Britain, Luxembourg, Monaco, the Netherlands, Norway and Sweden; and
Swire Beverages (“Swire”)Coca-Cola İçecek A.Ş., which has bottling and distribution operations in Hong Kong, Taiwan, seven provincesTurkey, Pakistan, Kazakhstan, Azerbaijan, Kyrgyzstan, Turkmenistan, Jordan, Iraq and Tajikistan and distribution operations in mainland China and territories in 11 states in the western United States.Syria.
In 2014,2015, these five bottling partners combined represented 3334 percent of our total unit case volume.
Being a bottler does not create a legal partnership or joint venture between us and our bottlers. Our bottlers are independent contractors and are not our agents.
BottlersBottler's Agreements
We have separate contracts (“Bottler’s Agreements”("Bottler's Agreements") with each of our bottling partners regarding the manufacture and sale of Company products. Subject to specified terms and conditions and certain variations, the Bottler’s Agreements generally authorize the bottlers to prepare specified Company Trademark Beverages, to package the same in authorized containers, and to distribute and sell the same in (but, subject to applicable local law, generally only in) an identified territory. The bottler is obligated to purchase its entire requirement of concentrates or syrups for the designated Company Trademark Beverages from the Company or Company-authorized suppliers. We typically agree to refrain from selling or distributing, or from authorizing third parties to sell or distribute, the designated Company Trademark Beverages throughout the identified territory in the particular authorized containers; however, we typically reserve for ourselves or our designee the right (1) to prepare and package such Company Trademark Beverages in such containers in the territory for sale outside the territory, (2) to prepare, package, distribute and sell such Company Trademark Beverages in the territory in any other manner or form (territorial

5



restrictions on bottlers vary in some cases in accordance with local law), and (3) to handle certain key accounts (accounts that cover multiple territories).
While under most of our Bottler’sBottler's Agreements we generally have complete flexibility to determine the price and other terms of sale of the concentrates and syrups we sell to our bottlers, as a practical matter, our Company’sCompany's ability to exercise its contractual flexibility to determine the price and other terms of sale of its syrups, concentrates and finished beverages is subject, both outside and within the United States, to competitive market conditions. In addition, in some instances we have agreed or may in the future agree with a bottler with respect to concentrate pricing on a prospective basis for specified time periods. Also, in some markets, in an effort to allow our Company and our bottling partners to grow together through shared value, aligned incentives and the flexibility necessary to meet consumers’consumers' always changing needs and tastes, we worked with our bottling partners to develop and implement an incidence-based pricing model for sparkling and still beverages. Under this model, the

6



concentrate price we charge is impacted by a number of factors, including, but not limited to, bottler pricing, the channels in which the finished products are sold and package mix.
Under our Bottler’sBottler's Agreements, in most cases, we have no obligation to provide marketing support to the bottlers. Nevertheless, we may, at our discretion, contribute toward bottler expenditures for advertising and marketing. We may also elect to undertake independent or cooperative advertising and marketing activities.
As further discussed below, our Bottler’sBottler's Agreements for territories outside of the United States differ in some respects from our Bottler’sBottler's Agreements for territories within the United States.
Bottler's Agreements Outside the United States
The Bottler's Agreements between us and our authorized bottlers outside the United States generally are of stated duration, subject in some cases to possible extensions or renewals of the term of the contract. Generally, these contracts are subject to termination by the Company following the occurrence of certain designated events. These events include defined events of default and certain changes in ownership or control of the bottler. Most of the Bottler's Agreements in force between us and bottlers outside the United States authorize the bottlers to manufacture and distribute fountain syrups, usually on a nonexclusive basis.
In certain parts of the world outside the United States, we have not granted comprehensive beverage production rights to the bottlers. In such instances, we or our authorized suppliers sell Company Trademark Beverages to the bottlers for sale and distribution throughout the designated territory, often on a nonexclusive basis. Most of the Bottler's Agreements in force between us and bottlers outside the United States authorize the bottlers to manufacture and distribute fountain syrups, usually on a nonexclusive basis.
Bottler's Agreements Within the United States
During the year ended December 31, 2014,2015, our Company-owned operations manufactured, sold and distributed 8682 percent of our U.S. unit case volume. The discussion below relates to Bottler's Agreements and other contracts for territories in the United States that are not covered by our Company-owned operations.
In the United States, with certain very limited exceptions, the Bottler's Agreements for Trademark Coca-Cola Beverages and other cola-flavored beverages have no stated expiration date. Our standard contracts for other sparkling beverage flavors and for still beverages are of stated duration, subject to bottler renewal rights. The Bottler's Agreements in the United States are subject to termination by the Company for nonperformance or upon the occurrence of certain defined events of default that may vary from contract to contract.
Under the terms of the Bottler's Agreements, bottlers in the United States are authorized to manufacture and distribute Company Trademark Beverages in bottles and cans. However, these bottlers generally are not authorized to manufacture fountain syrups. Rather, in the United States, our Company manufactures and sells fountain syrups to authorized fountain wholesalers (including certain authorized bottlers) and some fountain retailers. These wholesalers in turn sell the syrups or deliver them on our behalf to restaurants and other retailers.
Certain of the Bottler's Agreements for cola-flavored sparkling beverages in effect in the United States give us complete flexibility to determine the price and other terms of sale of concentrates and syrups for such Company Trademark Beverages. In some instances, we have agreed or may in the future agree with a bottler with respect to concentrate pricing on a prospective basis for specified time periods. Certain Bottler's Agreements, entered into prior to 1987, provide for concentrates or syrups for certain Trademark Coca-Cola Beverages and other cola-flavored Company Trademark Beverages to be priced pursuant to a stated formula. Bottlers that accounted for 6.36.9 percent of totalU.S. unit case volume in the United States in 20142015 have contracts for certain Trademark Coca-Cola Beverages and other cola-flavored Company Trademark Beverages with pricing formulas that generally provide for a baseline price. This baseline price may be adjusted periodically by the Company, up to a maximum indexed ceiling price, and is adjusted quarterly based upon changes in certain sugar or sweetener prices, as applicable. Bottlers that accounted for 0.3 percent of totalU.S. unit case volume in the United States in 20142015 operate under our oldest form of contract, which provides for a fixed price for Coca-Cola syrup used in bottles and cans. This price is subject to quarterly adjustments to reflect changes in the quoted price of sugar.

We have standard contracts
6



In conjunction with bottlersimplementing a new beverage partnership model in the United States for the sale of concentrates and syrups for non-cola-flavored sparkling beverages and certain still beverages in bottles and cans, and, in certain cases, for the sale of finished still beverages in bottles and cans. All of these standard contracts giveNorth America, the Company complete flexibility to determine the price and other terms of sale.
In addition to the Bottler's Agreements described above, in 2014, the Company and certain bottlershas entered into comprehensive beverage agreements ("CBAs") with certain bottling partners pursuant to which we granted to these bottlers certain exclusive territory rights for the distribution, promotion, marketing and sale of Company-owned and licensed beverage products as defined by the CBA. In some cases, the Company has entered into, or agreed to enter into, manufacturing agreements that authorize certain bottlers that have executed CBAs to manufacture certain beverage products. If a bottler has not entered into a specific manufacturing agreement, then under whichthe CBA for the applicable territories, CCR retains the rights to produce these beverage products and the bottlers are authorizedwill purchase from CCR (or other Company-authorized manufacturing bottlers) substantially all of the related finished products needed in order to purchase Company Trademark Beverages fromservice the Company or another supplier authorized by the Company and to distribute, promote, market and sell such beverages, on an

7



exclusive basis,customers in the territories covered by the CBAs. The CBAs do not grant to the bottlers the right to produce the products.these territories. Each CBA generally has a term of 10 years and is renewable, indefinitelyin most cases by the bottler and in some cases by the Company, indefinitely for successive additional terms of 10 years unless it is earlier terminated byeach. Under the CompanyCBA, each bottler will make ongoing quarterly payments to CCR based on its gross profit in the refranchised territories throughout the term of the CBA, including renewals, in exchange for nonperformance or upon the occurrencegrant of certain defined events of default.the exclusive territory rights. For more information about the North America refranchising transactions, refer to Note 2 of Notes to Consolidated Financial Statements set forth in Part II, "Item 8. Financial Statements and Supplementary Data" of this report.
Promotions and Marketing Programs
In addition to conducting our own independent advertising and marketing activities, we may provide promotional and marketing services and/or funds to our bottlers. In most cases, we do this on a discretionary basis under the terms of commitment letters or agreements, even though we are not obligated to do so under the terms of the bottling or distribution agreements between our Company and the bottlers. Also, on a discretionary basis in most cases, our Company may develop and introduce new products, packages and equipment to assist the bottlers. Likewise, in many instances, we provide promotional and marketing services and/or funds and/or dispensing equipment and repair services to fountain and bottle/can retailers, typically pursuant to marketing agreements. The aggregate amount of funds provided by our Company to bottlers, resellers or other customers of our Company's products, principally for participation in promotional and marketing programs, was $7.0$6.8 billion in 2014.2015.
Investments in Bottling Operations
Most of our branded beverage products outside of North America are manufactured, sold and distributed by independent bottling partners. However, from time to time we acquire or take control of bottling or canning operations, often in underperforming markets where we believe we can use our resources and expertise to improve performance. Owning such a controlling interest enables us to compensate for limited local resources; help focus the bottler’sbottler's sales and marketing programs; assist in the development of the bottler’sbottler's business and information systems; and establish an appropriate capital structure for the bottler. In line with our long-term bottling strategy, we may periodically consider options for divesting or reducing our ownership interest in a Company-owned or -controlled bottler. One such option is to combinebottler, typically by selling our interest in a particular bottling operation to an independent bottler with the interests of others to form strategic business alliances. Another option is toimprove Coca-Cola system efficiency. When we sell our interest in a bottling operation to one of our other bottling partners in which we have an equity method investment. In both of these situations,investment, our Company continues to participate in the bottler’sbottler's results of operations through our share of the strategic business alliance’s or equity method investee’sinvestee's earnings or losses.
As described under the heading “Acquisition of Coca-Cola Enterprises Inc.’s Former North America Business and Related Transactions” above, on October 2, 2010, we acquired the former North America business of CCE. In 2014, we began the implementation of a new business model in the United States which includes more rational and contiguous operating territories; grants of exclusive territory rights and the sale by us of distribution assets and cold-drink equipment to the bottlers; a finished goods model under which production assets remain with us, which facilitates future implementation of a national product supply system; an improved, more integrated information technology platform; and a newbeverage agreement, the CBA (refer to "Bottler's Agreements Within the United States" above for more information regarding the CBA), that will support the evolving operating model.
In addition, from time to time we make equity investments representing noncontrolling interests in selected bottling operations with the intention of maximizing the strength and efficiency of the Coca-Cola system’ssystem's production, marketing, sales and distribution capabilities around the world.world by providing expertise and resources to strengthen those businesses. These investments are intended to result in increases in unit case volume, net revenues and profits at the bottler level, which in turn generate increased concentrate sales for our Company’sCompany's concentrate and syrup business. When this occurs, both we and our bottling partners benefit from long-term growth in volume and improved cash flows and increased shareowner value. In cases where our investments in bottlers represent noncontrolling interests, our intention is to provide expertise and resources to strengthen those businesses.flows. When our equity investment provides us with the ability to exercise significant influence over the investee bottler’sbottler's operating and financial policies, we account for the investment under the equity method, and we sometimes refer to such a bottler as an “equity"equity method investee bottler”bottler" or “equity"equity method investee."
Our equity method investee bottlers include Coca-Cola FEMSA, in which as of December 31, 2014,2015, we had an equity ownership interest of 28 percent, and Coca-Cola Hellenic, in which as of December 31, 2014,2015, we had an equity ownership interest of 2324 percent, and Coca-Cola İçecek A.Ş., in which as of December 31, 2015, we had an equity ownership interest of 20 percent.

7



Seasonality
Sales of our nonalcoholic ready-to-drink beverages are somewhat seasonal, with the second and third calendar quarters accounting for the highest sales volumes. The volume of sales in the beverage business may be affected by weather conditions.

8



Competition
The nonalcoholic beverage segment of the commercial beverage industry is highly competitive, consisting of numerous companies ranging from small or emerging to very large and well established. These include companies that, like our Company, compete in multiple geographic areas, as well as businesses that are primarily regional or local in operation. Competitive products include numerous nonalcoholic sparkling beverages; various water products, including packaged, flavored and enhanced waters; juices and nectars; fruit drinks and dilutables (including syrups and powdered drinks); coffees and teas; energy and sports and other performance-enhancing drinks; filtered milk and other dairy-based drinks; functional beverages, including vitamin-based products and relaxation beverages; and various other nonalcoholic beverages. These competitive beverages are sold to consumers in both ready-to-drink and other than ready-to-drink form. In many of the countries in which we do business, including the United States, PepsiCo, Inc. ("PepsiCo"), is one of our primary competitors. Other significant competitors include, but are not limited to, Nestlé, DPSG, Groupe Danone, Mondelēz International, Inc. ("Mondelēz"), Kraft Foods Group, Inc. ("Kraft"), Suntory Beverage & Food Limited ("Suntory") and the Unilever Group ("Unilever").Unilever. In certain markets, our competition also includes beer companies. We also compete against numerous regional and local companies and, in some markets, against retailers that have developed their own store or private label beverage brands.
Competitive factors impacting our business include, but are not limited to, pricing, advertising, sales promotion programs, product innovation, increased efficiency in production techniques, the introduction of new packaging, new vending and dispensing equipment, and brand and trademark development and protection.
Our competitive strengths include leading brands with high levels of consumer acceptance; a worldwide network of bottlers and distributors of Company products; sophisticated marketing capabilities; and a talented group of dedicated associates. Our competitive challenges include strong competition in all geographic regions and, in many countries, a concentrated retail sector with powerful buyers able to freely choose among Company products, products of competitive beverage suppliers and individual retailers' own store or private label beverage brands.
Raw Materials
Water is a main ingredient in substantially all of our products. While historically we have not experienced significant water supply difficulties, water is a limited natural resource in many parts of the world, and our Company recognizes water availability, quality and sustainability, for both our operations and also the communities where we operate, as one of the key challenges facing our business.
In addition to water, the principal raw materials used in our business are nutritive and non-nutritive sweeteners. In the United States, the principal nutritive sweetener is high fructose corn syrup ("HFCS"), which is nutritionally equivalent to sugar. HFCS is available from numerous domestic sources and has historically been subject to fluctuations in its market price. The principal nutritive sweetener used by our business outside the United States is sucrose, i.e., table sugar, which is also available from numerous sources and has historically been subject to fluctuations in its market price. Our Company generally has not experienced any difficulties in obtaining its requirements for nutritive sweeteners. In the United States, we purchase HFCS to meet our and our bottlers' requirements with the assistance of Coca-Cola Bottlers' Sales & Services Company LLC ("CCBSS"). CCBSS is a limited liability company that is owned by authorized Coca-Cola bottlers doing business in the United States. Among other things, CCBSS provides procurement services to our Company for the purchase of various goods and services in the United States, including HFCS.
The principal non-nutritive sweeteners we use in our business are aspartame, acesulfame potassium, saccharin, cyclamate, sucralose and sucralose.a sweetener derived from the stevia plant. Generally, these raw materials are readily available from numerous sources. However, our Company purchases aspartame, an important non-nutritive sweetener that is used alone or in combination with other important non-nutritive sweeteners such as saccharin or acesulfame potassium in our low- and no-calorie sparkling beverage products, primarily from Ajinomoto Co., Inc. and SinoSweet Co., Ltd., which we consider to be our primary sources for the supply of this product. We currently purchase acesulfame potassium from Nutrinova Nutrition Specialties & Food Ingredients GmbH, which we consider to be our primary source for the supply of this product, and from one additional supplier. Our Company generally has not experienced any difficulties in obtaining its requirements for non-nutritive sweeteners.
Our Company sells a number of products sweetened with sucralose, a non-nutritive sweetener.sweeteners and we do not anticipate such difficulties in the future. We work closely with Tate & Lyle PLC, our primary sucralose supplier, to maintain continuity of supply, and we do not anticipate difficulties in obtaining our requirements. We also sell beverage products sweetened with a non-nutritive sweetener derived from the stevia plant. We do not anticipate difficulties sourcing stevia-based ingredients.supply.

With regard to juice and juice drink products, juice
8



Juice and juice concentrate from various fruits, particularly orange juice and orange juice concentrate, are ourthe principal raw materials.materials for our juice and juice drink products. We source our orange juice and orange juice concentrate primarily from Florida and the Southern Hemisphere (particularly Brazil). Therefore, we typically haveWe work closely with Cutrale Citrus Juices U.S.A., Inc., our primary supplier of orange juice from Florida and Brazil, to ensure an adequate supply of orange

9



juice and orange juice concentrate that meets our Company’sCompany's standards. However, the citrus industry is impacted by greening disease and the variability of weather conditions. In particular, freezing weather or hurricanes in central Florida may result in shortages and higher prices for orange juice and orange juice concentrate throughout the industry. In addition, greening disease is reducing the number of trees and increasing grower costs and prices.
Our Company-owned or consolidated bottling and canning operations and our finished product business also purchase various other raw materials including, but not limited to, polyethylene terephthalate ("PET") resin, preforms and bottles; glass and aluminum bottles; aluminum and steel cans; plastic closures; aseptic fiber packaging; labels; cartons; cases; postmix packaging; and carbon dioxide. We generally purchase these raw materials from multiple suppliers and historically have not experienced materialsignificant shortages.
Patents, Copyrights, Trade Secrets and Trademarks
Our Company owns numerous patents, copyrights and trade secrets, as well as substantial know-how and technology, which we collectively refer to in this report as "technology." This technology generally relates to our Company's products and the processes for their production; the packages used for our products; the design and operation of various processes and equipment used in our business; and certain quality assurance software. Some of the technology is licensed to suppliers and other parties. Our sparkling beverage and other beverage formulae are among the important trade secrets of our Company.
We own numerous trademarks that are very important to our business. Depending upon the jurisdiction, trademarks are valid as long as they are in use and/or their registrations are properly maintained. Pursuant to our Bottler's Agreements, we authorize our bottlers to use applicable Company trademarks in connection with their manufacture, sale and distribution of Company products. In addition, we grant licenses to third parties from time to time to use certain of our trademarks in conjunction with certain merchandise and food products.
Governmental Regulation
Our Company is required to comply, and it is our policy to comply, with all applicable laws in the numerous countries throughout the world in which we do business. In many jurisdictions, compliance with competition laws is of special importance to us, and our operations may come under special scrutiny by competition law authorities due to our competitive position in those jurisdictions.
In the United States, the safety, production, transportation, distribution, advertising, labeling and sale of many of our Company's products and their ingredients are subject to the Federal Food, Drug, and Cosmetic Act; the Federal Trade Commission Act; the Lanham Act; state consumer protection laws; competition laws; federal, state and local workplace health and safety laws; various federal, state and local environmental protection laws; and various other federal, state and local statutes and regulations. Outside the United States, our business is subject to numerous similar statutes and regulations, as well as other legal and regulatory requirements.
Under a California law known as Proposition 65, if the state has determined that a substance causes cancer or harms human reproduction, a warning must appear on any product sold in the state containingthat exposes consumers to that substance. The state maintains lists of these substances and periodically adds other substances to these lists.them. Proposition 65 exposes all food and beverage producers to the possibility of having to provide warnings on their products in California because it does not provide for any generally applicable quantitative threshold below which the presence of a listed substance is exempt from the warning requirement. Consequently, the detection of even a trace amount of a listed substance can subject an affected product to the requirement of a warning label. However, Proposition 65 does not require a warning if the manufacturer of a product can demonstrate that the use of that product exposes consumers to a daily quantity of a listed substance that is:
below a "safe harbor" threshold that may be established;
naturally occurring;
the result of necessary cooking; or
subject to another applicable exemption.

9



One or more substances that are currently on the Proposition 65 lists, or that may be added in the future, can be detected in certain Company products at low levels that are safe. With respect to substances that have not yet been listed under Proposition 65, the Company takes the position that listing is not scientifically justified. With respect to substances that are already listed, the Company takes the position that the presence of each such substance in Company products is subject to an applicable exemption from the warning requirement. The state of California and other parties, however, have in the past taken a contrary position and may do so in the future take a contrary position.future.

10



Bottlers of our beverage products presently offer and use nonrefillable recyclable containers in the United States and various other markets around the world. Some of these bottlers also offer and use refillable containers, which are also recyclable. Legal requirements apply in various jurisdictions in the United States and overseas requiring that deposits or certain ecotaxes or fees be charged in connection with the sale, marketing and use of certain beverage containers. The precise requirements imposed by these measures vary. Other types of statutes and regulations relating to beverage container deposits, recycling, ecotaxes and/or product stewardship also apply in various jurisdictions in the United States and overseas. We anticipate that additional similarsuch legal requirements may be proposed or enacted in the future at local, state and federal levels, both in the United States and elsewhere.
All of our Company's facilities and other operations in the United States and elsewhere around the world are subject to various environmental protection statutes and regulations, including those relating to the use of water resources and the discharge of wastewater. Our policy is to comply with all such legal requirements. Compliance with these provisions has not had, and we do not expect such compliance to have, any material adverse effect on our Company's capital expenditures, net income or competitive position.
Employees
As of December 31, 20142015 and 20132014, our Company had approximately 129,200123,200 and 130,600129,200 employees, respectively, of which approximately 3,8003,300 and 4,100,3,800, respectively, were employed by consolidated variable interest entities ("VIEs"). The decrease in the total number of employees in 20142015 was primarily due to the refranchising of certain territories that were previously managed by CCR to certain of itsthe Company's unconsolidated bottling partners. For more information about the North America refranchising transactions, refer to Note 2 of Notes to Consolidated Financial Statements set forth in Part II, "Item 8. Financial Statements and Supplementary Data" of this report. As of December 31, 20142015 and 20132014, our Company had approximately 65,30060,900 and 66,80065,300 employees, respectively, located in the United States, of which approximately 500 were employed by consolidated VIEs in both years.
Our Company, through its divisions and subsidiaries, is a party to numerous collective bargaining agreements. As of December 31, 20142015, approximately 18,00017,500 employees, excluding seasonal hires, in North America were covered by collective bargaining agreements. These agreements typically have terms of three years to five years years.. We currently expect that we will be able to renegotiate such agreements on satisfactory terms when they expire.
The Company believes that its relations with its employees are generally satisfactory.
Securities Exchange Act Reports
The Company maintains a website at the following address: www.coca-colacompany.com. The information on the Company's website is not incorporated by reference in this annual reportAnnual Report on Form 10-K.
We make available on or through our website certain reports and amendments to those reports that we file with or furnish to the Securities and Exchange Commission (the "SEC"("SEC") in accordance with the Securities Exchange Act of 1934, as amended (the "Exchange("Exchange Act"). These include our annual reportsAnnual Reports on Form 10-K, our quarterly reportsQuarterly Reports on Form 10-Q and our current reportsCurrent Reports on Form 8-K. We make this information available on our website free of charge as soon as reasonably practicable after we electronically file the information with, or furnish it to, the SEC.

1110



ITEM 1A.  RISK FACTORS
In addition to the other information set forth in this report, you should carefully consider the following factors, which could materially affect our business, financial condition or results of operations in future periods. The risks described below are not the only risks facing our Company. Additional risks not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition or results of operations in future periods.
Obesity concerns may reduce demand for some of our products.
There is growing concern among consumers, public health professionals and government agencies about the health problems associated with obesity. In addition, some researchers, health advocates and dietary guidelines are suggesting that consumption of sugar-sweetened beverages, including those sweetened with HFCS or other nutritive sweeteners, is a primary cause of increased obesity rates and are encouraging consumers to reduce or eliminate consumption of such products. Increasing public concern about obesity; possible new or increased taxes on sugar-sweetened beverages by government entities to reduce consumption or to raise revenue; additional governmental regulations concerning the marketing, labeling, packaging or sale of our sugar-sweetened beverages; and negative publicity resulting from actual or threatened legal actions against us or other companies in our industry relating to the marketing, labeling or sale of sugar-sweetened beverages may reduce demand for or increase the cost of our sugar-sweetened beverages, which could adversely affect our profitability.
Water scarcity and poor quality could negatively impact the Coca-Cola system’ssystem's costs and capacity.
Water is a main ingredient in substantially all of our products, is vital to the production of the agricultural ingredients on which our business relies and is needed in our manufacturing process. It also is critical to the prosperity of the communities we serve. Water is a limited resource in many parts of the world, facing unprecedented challenges from overexploitation, increasing demand for food and other consumer and industrial products whose manufacturing processes require water, increasing pollution, poor management and the effects of climate change. As the demand for water continues to increase around the world, and as water becomes scarcer and the quality of available water deteriorates, the Coca-Cola system may incur higher costs or face capacity constraints that could adversely affect our profitability or net operating revenues in the long run.
If we do not anticipate and address evolving consumer preferences, our business could suffer.
Consumer preferences are evolving rapidly as a result of, among other things, health and nutrition considerations, especially the perceived undesirability of artificial ingredients and obesity concerns; shifting consumer demographics, including aging populations; changes in consumer tastes and needs; changes in consumer lifestyles; and competitive product and pricing pressures. If we do not successfully anticipate these changing consumer preferences or fail to address them by timely developing new products or product extensions through innovation, our share of sales, volume growth and overall financial results could be negatively affected.
Increased competition and capabilities in the marketplace could hurt our business.
The nonalcoholic beverage segment of the commercial beverage industry is highly competitive. We compete with major international beverage companies that, like our Company, operate in multiple geographic areas, as well as numerous companies that are primarily regional or local in operation. In many countries in which we do business, including the United States, PepsiCo is a primary competitor. Other significant competitors include, but are not limited to, Nestlé, DPSG, Groupe Danone, Mondelēz, Kraft, Suntory and Unilever. In certain markets, our competition also includes major beer companies. Our beverage products also compete against private label brands developed by retailers, some of which are Coca-Cola system customers. Our ability to gain or maintain share of sales in the global market or in various local markets may be limited as a result of actions by competitors. If we do not continue to strengthen our capabilities in marketing and innovation to maintain our brand loyalty and market share while we selectively expand into other product categories in the nonalcoholic beverage segment of the commercial beverage industry, our business could be negatively affected.
Product safety and quality concerns could negatively affect our business.
Our success depends in large part on our ability to maintain consumer confidence in the safety and quality of all of our products. We have rigorous product safety and quality standards which we expect our operations as well as our bottling partners to meet. However, we cannot assure you that despite our strong commitment to product safety and quality we or all of our bottling partners will always meet these standards, particularly as we expand our product offerings through innovation or acquisitions of products, such as value-added dairy products, that are beyond our traditional range of beverage products. If we or our bottling partners fail to comply with applicable product safety and quality standards and beverage products taken to the market are or become contaminated or adulterated, we may be required to conduct costly product recalls and may become subject to product liability claims and negative publicity, which could cause our business to suffer.

1211



Public debate and concern about perceived negative health consequences of certain ingredients, such as non-nutritive sweeteners and biotechnology-derived substances, and of other substances present in our beverage products or packaging materials, may reduce demand for our beverage products.
Public debate and concern about perceived negative health consequences of certain ingredients in our beverage products, such as non-nutritive sweeteners and biotechnology-derived substances; substances that are present in our beverage products naturally or that occur as a result of the manufacturing process, such as 4-methylimidazole, or 4-MEI (a chemical compound that is formed during the manufacturing of certain types of caramel coloring used in cola-type beverages); or substances used in packaging materials, such as bisphenol A, or BPA (an odorless, tasteless food-grade chemical commonly used in the food and beverage industries as a component in the coating of the interior of cans), may affect consumers’consumers' preferences and cause them to shift away from some of our beverage products. In addition, increasing public concern about actual or perceived health consequences of the presence of such ingredients or substances in our beverage products or in packaging materials, whether or not justified, could result in additional governmental regulations concerning the marketing and labeling of our beverages, negative publicity, or actual or threatened legal actions against us or other companies in our industry, all of which could damage the reputation of, and may reduce demand for, our beverage products.
If we are not successful in our innovation activities, our results may be negatively affected.
Achieving our business growth objectives depends in part on our ability to successfully develop, introduce and market new beverage products. The success of our innovation activities in turn depends on our ability to correctly anticipate customer and consumer acceptance and trends, obtain, maintain and enforce necessary intellectual property protections and avoid infringing on the intellectual property rights of others. If we are not successful in our innovation activities, we may not be able to achieve our growth objectives, which may have a negative impact on our financial results.
Increased demand for food products and decreased agricultural productivity may negatively affect our business.
We and our bottling partners use a number of key ingredients that are derived from agricultural commodities such as sugarcane, corn, sugar beets, citrus, coffee and tea in the manufacture and packaging of our beverage products. Increased demand for food products and decreased agricultural productivity in certain regions of the world as a result of changing weather patterns may limit the availability or increase the cost of such agricultural commodities and could impact the food security of communities around the world. If we are unable to implement programs focused on economic opportunity and environmental sustainability to address these agricultural challenges and fail to make a strategic impact on food security through joint efforts with bottlers, farmers, communities, suppliers and key partners, as well as through our increased and continued investment in sustainable agriculture, the affordability of our products and ultimately our business and results of operations could be negatively impacted.
Changes in the retail landscape or the loss of key retail or foodservice customers could adversely affect our financial performance.
Our industry is being affected by the trend toward consolidation in the retail channel, particularly in Europe and the United States. Larger retailers may seek lower prices from us and our bottling partners, may demand increased marketing or promotional expenditures, and may be more likely to use their distribution networks to introduce and develop private label brands, any of which could negatively affect the Coca-Cola system’ssystem's profitability. In addition, in developed markets, discounters and value stores, as well as the volume of transactions through e-commerce, are growing at a rapid pace. The nonalcoholic beverage retail landscape is also very dynamic and constantly evolving in emerging and developing markets, where modern trade is growing at a faster pace than traditional trade outlets. If we are unable to successfully adapt to the rapidly changing environment and retail landscape, our share of sales, volume growth and overall financial results could be negatively affected. In addition, our success depends in part on our ability to maintain good relationships with key retail and foodservice customers. The loss of one or more of our key retail or foodservice customers could have an adverse effect on our financial performance.
If we are unable to expand our operations in emerging and developing markets, our growth rate could be negatively affected.
Our success depends in part on our ability to grow our business in emerging and developing markets, which in turn depends on economic and political conditions in those markets and on our ability to acquire bottling operations in those markets or to form strategic business alliances with local bottlers and to make necessary infrastructure enhancements to production facilities, distribution networks, sales equipment and technology. Moreover, the supply of our products in emerging and developing markets must match consumers’ demand for those products. Due to product price, limited purchasing power and cultural differences, there can be no assurance that our products will be accepted in any particular emerging or developing market.

12



Fluctuations in foreign currency exchange rates could have a material adverse effect on our financial results.
We earn revenues, pay expenses, own assets and incur liabilities in countries using currencies other than the U.S. dollar, including the euro, the Japanese yen, the Brazilian real and the Mexican peso. In 2014,2015, we used 7071 functional currencies in addition to the U.S. dollar and derived $26.2$23.9 billion of net operating revenues from operations outside the United States. Because our consolidated financial statements are presented in U.S. dollars, we must translate revenues, income and expenses, as well as assets and liabilities, into U.S. dollars at exchange rates in effect during or at the end of each reporting period. Therefore, increases or decreases in the value of the U.S. dollar against other major currencies affect our net operating revenues, operating income and the value of balance sheet items denominated in foreign currencies. In addition, unexpected and dramatic devaluations of currencies in developing or emerging markets could negatively affect the value of our earnings from,

13



and of the assets located in, those markets. Because of the geographic diversity of our operations, weaknesses in some currencies might be offset by strengths in others over time. We also use derivative financial instruments to further reduce our net exposure to foreign currency exchange rate fluctuations. However, we cannot assure you that fluctuations in foreign currency exchange rates, particularly the strengthening of the U.S. dollar against major currencies or the currencies of large developing countries, would not materially affect our financial results.
If interest rates increase, our net income could be negatively affected.
We maintain levels of debt that we consider prudent based on our cash flows, interest coverage ratio and percentage of debt to capital. We use debt financing to lower our cost of capital, which increases our return on shareowners’shareowners' equity. This exposes us to adverse changes in interest rates. When and to the extent appropriate, we use derivative financial instruments to reduce our exposure to interest rate risks. We cannot assure you, however, that our financial risk management program will be successful in reducing the risks inherent in exposures to interest rate fluctuations. Our interest expense may also be affected by our credit ratings. In assessing our credit strength, credit rating agencies consider our capital structure and financial policies as well as the consolidated balance sheet and other financial information of the Company. In addition, some credit rating agencies also consider financial information of certain of our major bottlers. It is our expectation that the credit rating agencies will continue using this methodology. If our credit ratings were to be downgraded as a result of changes in our capital structure; our major bottlers’bottlers' financial performance; changes in the credit rating agencies’agencies' methodology in assessing our credit strength; the credit agencies’agencies' perception of the impact of credit market conditions on our or our major bottlers’bottlers' current or future financial performance and financial condition; or for any other reason, our cost of borrowing could increase. Additionally, if the credit ratings of certain bottlers in which we have equity method investments were to be downgraded, such bottlers’bottlers' interest expense could increase, which would reduce our equity income.
We rely on our bottling partners for a significant portion of our business. If we are unable to maintain good relationships with our bottling partners, our business could suffer.
We generate a significant portion of our net operating revenues by selling concentrates and syrups to independent bottling partners. As independent companies, our bottling partners, some of which are publicly traded companies, make their own business decisions that may not always align with our interests. In addition, many of our bottling partners have the right to manufacture or distribute their own products or certain products of other beverage companies. If we are unable to provide an appropriate mix of incentives to our bottling partners through a combination of pricing and marketing and advertising support, or if our bottling partners are not satisfied with our brand innovation and development efforts, they may take actions that, while maximizing their own short-term profits, may be detrimental to our Company or our brands, or they may devote more of their energy and resources to business opportunities or products other than those of the Company. Such actions could, in the long run, have an adverse effect on our profitability.
If our bottling partners’partners' financial condition deteriorates, our business and financial results could be affected.
We derive a significant portion of our net operating revenues from sales of concentrates and syrups to independent bottling partners and, therefore, the success of our business depends on our bottling partners’partners' financial strength and profitability. While under our agreements with our bottling partners we generally have the right to unilaterally change the prices we charge for our concentrates and syrups, our ability to do so may be materially limited by our bottling partners’partners' financial condition and their ability to pass price increases along to their customers. In addition, we have investments in certain of our bottling partners, which we account for under the equity method, and our operating results include our proportionate share of such bottling partners’partners' income or loss. Our bottling partners’partners' financial condition is affected in large part by conditions and events that are beyond our and their control, including competitive and general market conditions in the territories in which they operate; the availability of capital and other financing resources on reasonable terms; loss of major customers; or disruptions of bottling operations that may be caused by strikes, work stoppages, labor unrest or natural disasters. A deterioration of the financial condition or results of operations of one or more of our major bottling partners could adversely affect our net operating revenues from sales of concentrates and syrups; could result in a decrease in our equity income; and could negatively affect the carrying values of our investments in bottling partners, resulting in asset write-offs.

13



Increases in income tax rates, changes in income tax laws or unfavorable resolution of tax matters could have a material adverse impact on our financial results.
We are subject to income tax in the United States and in numerous other jurisdictions in which we generate net operating revenues. Increases in income tax rates could reduce our after-tax income from affected jurisdictions. We earn a substantial portion of our income in foreign countries. If our capital or financing needs in the United States require us to repatriate earnings from foreign jurisdictions above our current levels, our effective tax rates for the affected periods could be negatively impacted. In addition, there have been proposals to reform U.S. tax laws that could significantly impact how U.S. multinational corporations are taxed on foreign earnings. Although we cannot predict whether or in what form these proposals will pass,

14



several of the proposals being considered, if enacted into law, could have a material adverse impact on our income tax expense and cash flow.flows.
Our annual tax rate is based on our income and the tax laws in the various jurisdictions in which we operate. Significant judgment is required in determining our annual income tax expense and in evaluating our tax positions. Although we believe our tax estimates are reasonable, the final determination of tax audits and any related disputes could be materially different from our historical income tax provisions and accruals. The results of audits or related disputes could have a material effect on our financial statements for the period or periods for which the applicable final determinations are made.made and for periods for which the statute of limitations is open. For instance, the United States Internal Revenue Service ("IRS") is seeking to increase our U.S. taxable income for tax years 2007 through 2009 by an amount that creates a potential additional U.S. federal income tax liability of approximately $3.3 billion for the period, plus interest. The IRS may add a claim for penalties at a later time. The disputed amounts largely relate to a transfer pricing matter involving the appropriate amount of taxable income the Company should report in the United States in connection with its licensing of intangible property to certain related foreign licensees regarding the manufacturing, distribution, sale, marketing and promotion of products in overseas markets. We are currently contesting the IRS' claims in the U.S. Tax Court. If the IRS were to prevail on its assertions, it would likely also seek transfer pricing adjustments of a similar nature for subsequent tax years. Consequently, if this dispute were to be ultimately determined adversely to us, the additional tax, interest and any potential penalties could have a material adverse impact on the Company's financial position, results of operations or cash flows.
Increased or new indirect taxes in the United States or in one or more of our other major markets could negatively affect our business.
Our business operations are subject to numerous duties or taxes that are not based on income, sometimes referred to as “indirect"indirect taxes," including import duties, excise taxes, sales or value-added taxes, taxes on sugar-sweetened beverages, property taxes and payroll taxes, in many of the jurisdictions in which we operate, including indirect taxes imposed by state and local governments. In addition, in the past, the United States Congress considered imposing a federal excise tax on beverages sweetened with sugar, HFCS or other nutritive sweeteners and may consider similar proposals in the future. As federal, state and local governments experience significant budget deficits, some lawmakers have proposed singling out beverages among a plethora of revenue-raising items. Increases in or the imposition of new indirect taxes on our business operations or products would increase the cost of products or, to the extent levied directly on consumers, make our products less affordable, which may negatively impact our net operating revenues.revenues and profitability.
Increase in the cost, disruption of supply or shortage of energy or fuels could affect our profitability.
CCR and our other Company-owned or -controlled bottlers operate a large fleet of trucks and other motor vehicles to distribute and deliver beverage products to customers. In addition, we use a significant amount of electricity, natural gas and other energy sources to operate our concentrate, syrup and juice production plants and the bottling plants and distribution facilities operated by CCR and our other Company-owned or -controlled bottlers. An increase in the price, disruption of supply or shortage of fuel and other energy sources in North America, in other countries in which we have concentrate plants, or in any of the major markets in which CCR and our other Company-owned or -controlled bottlers operate that may be caused by increasing demand or by events such as natural disasters, power outages, or the like could increase our operating costs and negatively impact our profitability.
Our independent bottling partners also operate large fleets of trucks and other motor vehicles to distribute and deliver beverage products to their own customers and use a significant amount of electricity, natural gas and other energy sources to operate their own bottling plants and distribution facilities. Increases in the price, disruption of supply or shortage of fuel and other energy sources in any of the major markets in which our independent bottling partners operate would increase the affected independent bottling partners’partners' operating costs and could indirectly negatively impact our results of operations.

14



Increase in the cost, disruption of supply or shortage of ingredients, other raw materials or packaging materials could harm our business.
We and our bottling partners use various ingredients in our business, including HFCS, sucrose, aspartame, saccharin, acesulfame potassium, cyclamate, sucralose, a non-nutritive sweetener derived from the stevia plant, ascorbic acid, citric acid, phosphoric acid, caffeine and caramel color; other raw materials such as orange and other fruit juice and juice concentrates; and packaging materials such as PET for bottles and aluminum for cans. The prices for these ingredients, other raw materials and packaging materials fluctuate depending on market conditions. Substantial increases in the prices of our or our bottling partners’partners' ingredients, other raw materials and packaging materials, to the extent they cannot be recouped through increases in the prices of finished beverage products, would increase our and the Coca-Cola system’ssystem's operating costs and could reduce our profitability. Increases in the prices of our finished products resulting from a higher cost of ingredients, other raw materials and packaging materials could affect affordability in some markets and reduce Coca-Cola system sales. In addition, some of our ingredients, such as aspartame, acesulfame potassium, sucralose, saccharin and ascorbic acid, as well as some of the packaging containers, such as aluminum cans, are available from a limited number of suppliers, some of which are located in countries experiencing political or other risks. We cannot assure you that we and our bottling partners will be able to maintain favorable arrangements and relationships with these suppliers.
The citrus industry is subject to disease and the variability of weather conditions, which affect the supply of orange juice and orange juice concentrate, which are important raw materials for our business. In particular, freezing weather or hurricanes in central Florida may result in shortages and higher prices for orange juice and orange juice concentrate throughout the industry. In addition, greening disease is reducing the number of trees and increasing grower costs and prices. Adverse weather conditions may affect the supply of other agricultural commodities from which key ingredients for our products are derived. For example, drought conditions in certain parts of the United States may negatively affect the supply of corn, which in turn may result in shortages of and higher prices for HFCS.

15



An increase in the cost, a sustained interruption in the supply, or a shortage of some of these ingredients, other raw materials, packaging materials or cans and other containers that may be caused by a deterioration of our or our bottling partners’partners' relationships with suppliers; by supplier quality and reliability issues; or by events such as natural disasters, power outages, labor strikes, political uncertainties or governmental instability, or the like could negatively impact our net operating revenues and profits.
Changes in laws and regulations relating to beverage containers and packaging could increase our costs and reduce demand for our products.
We and our bottlers currently offer nonrefillable recyclable containers in the United States and in various other markets around the world. Legal requirements have been enacted in various jurisdictions in the United States and overseas requiring that deposits or certain ecotaxes or fees be charged in connection with the sale, marketing and use of certain beverage containers. Other proposals relating to beverage container deposits, recycling, ecotax and/or product stewardship have been introduced in various jurisdictions in the United States and overseas, and we anticipate that similar legislation or regulations may be proposed in the future at local, state and federal levels, both in the United States and elsewhere. Consumers’Consumers' increased concerns and changing attitudes about solid waste streams and environmental responsibility and the related publicity could result in the adoption of such legislation or regulations. If these types of requirements are adopted and implemented on a large scale in any of the major markets in which we operate, they could affect our costs or require changes in our distribution model, which could reduce our net operating revenues orand profitability.
Significant additional labeling or warning requirements or limitations on the availabilitymarketing or sale of our products may inhibit sales of affected products.
Various jurisdictions may seek to adopt significant additional product labeling or warning requirements or limitations on the availabilitymarketing or sale of our products relating to the contentas a result of what they contain or perceivedallegations that they cause adverse health consequences of certain of our products.effects. If these types of requirements become applicable to one or more of our major products under current or future environmental or health laws or regulations, they may inhibit sales of such products.
Under one such law in California, known as Proposition 65, if the state has determined that a substance causes cancer or harms human reproduction, a warning must appear on any product sold in the state containingthat exposes consumers to that substance. The state maintains lists of these substances and periodically adds other substances to these lists.them. Proposition 65 exposes all food and beverage producers to the possibility of having to provide warnings on their products in California because it does not provide for any generally applicable quantitative threshold below which the presence of a listed substance is exempt from the warning requirement. Consequently, the detection of even a trace amount of a listed substance can subject an affected product to the requirement of a warning label. However, Proposition 65 does not require a warning if the manufacturer of a product can demonstrate that the use of the product in question exposes consumers to a daily quantity of a listed substance that is below a “safe harbor”

15



"safe harbor" threshold that may be established, is naturally occurring, is the result of necessary cooking or is subject to another applicable exception. One or more substances that are currently on the Proposition 65 lists, or that may be added to the lists in the future, can be detected in certain Company products at low levels that are safe. With respect to substances that have not yet been listed under Proposition 65, the Company takes the position that listing is not scientifically justified. With respect to substances that are already listed, the Company takes the position that the presence of each such substance in Company products is subject to an applicable exemption from the warning requirement. The state of California and other parties, however, have in the past taken a contrary position and may do so in the future take a contrary position.future. If we were required to add Proposition 65 warnings on the labels of one or more of our beverage products produced for sale in California, the resulting consumer reaction to the warnings and possible adverse publicity could negatively affect our sales both in California and in other markets.
If we are unable to protect our information systems against service interruption, misappropriation of data or breaches of security, our operations could be disrupted and our reputation may be damaged.
We rely on networks and information systems and other technology (“("information systems”systems"), including the Internet and third-party hosted services, to support a variety of business processes and activities, including procurement and supply chain, manufacturing, distribution, invoicing and collection of payments.payments, mergers and acquisitions and research and development. We use information systems to process financial information and results of operations for internal reporting purposes and to comply with regulatory financial reporting and legal and tax requirements. In addition, we depend on information systems for digital marketing activities and electronic communications among our locations around the world and between Company personnel and our bottlers and other customers, suppliers and consumers. Because information systems are critical to many of the Company’sCompany's operating activities, our business may be impacted by system shutdowns, service disruptions or security breaches. These incidents may be caused by failures during routine operations such as system upgrades or user errors, as well as network or hardware failures, malicious or disruptive software, computer hackers, rogueunintentional or malicious actions of employees or contractors, cyber-attackscyberattacks by common hackers, criminal groups or activistnation-state organizations or social-activist (hacktivist) organizations, geopolitical events, natural disasters, failures or impairments of telecommunications networks, or other catastrophic events. In addition, such incidents could result in unauthorized disclosure of material confidential information. If our information systems suffer severe damage, disruption or shutdown and our business continuity plans do not effectively resolve the issues in a timely

16



manner, we could experience delays in reporting our financial results, and we may lose revenue and profits as a result of our inability to timely manufacture, distribute, invoice and collect payments for concentrate or finished products. Misuse, leakage or falsification of information could result in a violationviolations of data privacy laws and regulations, damage to the reputation and credibility of the Company, loss of opportunities to acquire or divest of businesses or brands and loss of ability to commercialize products developed through research and development efforts and, therefore, could have a negative impact on net operating revenues. In addition, we may suffer financial and reputational damage because of lost or misappropriated confidential information belonging to us, our current or former employees, or to our bottling partners, other customers, suppliers or consumers, and may become subject to legal action and increased regulatory oversight. The Company could also be required to spend significant financial and other resources to remedy the damage caused by a security breach or to repair or replace networks and information systems.
Like most major corporations, the Company’sCompany's information systems are a target of attacks. Although the incidents that we have experienced to date have not had a material effect on our business, financial condition or results of operations, there can be no assurance that such incidents will not have a material adverse effect on us in the future. In order to address risks to our information systems, we continue to make investments in personnel, technologies, cyber-insurancecyber insurance and training of Company personnel. The Company maintains an information risk management program which is supervised by information technology management and reviewed by a cross-functional committee. As part of this program, reports that include analysis of emerging risks as well as the Company’sCompany's plans and strategies to address them are regularly prepared and presented to senior management.management and the Audit Committee of the Board of Directors.
Unfavorable general economic conditions in the United States could negatively impact our financial performance.
In 2014,2015, our net operating revenues in the United States were $19.8$20.4 billion, or 4346 percent, of our total net operating revenues. Unfavorable general economic conditions, such as a recession or economic slowdown, in the United States could negatively affect the affordability of, and consumer demand for, our beverages in our flagship market. Under difficult economic conditions, consumers may seek to reduce discretionary spending by forgoing purchases of our products or by shifting away from our beverages to lower-priced products offered by other companies, including private label brands. Softer consumer demand for our beverages in the United States could reduce our profitability and could negatively affect our overall financial performance.

16



Unfavorable economic and political conditions in international markets could hurt our business.
We derive a significant portion of our net operating revenues from sales of our products in international markets. In 2014,2015, our operations outside the United States accounted for $26.2$23.9 billion, or 5754 percent, of our total net operating revenues. Unfavorable economic conditions and financial uncertainties in our major international markets the financial uncertainties in some countries in the eurozone and unstable political conditions, including civil unrest and governmental changes, in certain of our other international markets could undermine global consumer confidence and reduce consumers’consumers' purchasing power, thereby reducing demand for our products. Product boycotts resulting from political activism could reduce demand for our products, while restrictions on our ability to transfer earnings or capital across borders, price controls, limitation on profits, import authorization requirements and other restrictions on business activities which have been or may be imposed or expanded as a result of political and economic instability or otherwise could impact our profitability. In addition, U.S. trade sanctions against countries suchdesignated by the U.S. government as Iran and Syriastate sponsors of terrorism and/or financial institutions accepting transactions for commerce within such countries could increase significantly, which could make it impossible for us to continue to make sales to bottlers in such countries.countries, while the imposition of sanctions against U.S. multinational corporations by countries in which our products are manufactured, distributed or sold could negatively affect our business in such markets.
Litigation or legal proceedings could expose us to significant liabilities and damage our reputation.
We are party to various litigation claims and legal proceedings. We evaluate these litigation claims and legal proceedings to assess the likelihood of unfavorable outcomes and to estimate, if possible, the amount of potential losses. Based on these assessments and estimates, we establish reserves and/or disclose the relevant litigation claims or legal proceedings, as appropriate. These assessments and estimates are based on the information available to management at the time and involve a significant amount of management judgment. We caution you that actual outcomes or losses may differ materially from those envisioned by our current assessments and estimates. In addition, we have bottling and other business operations in markets with high-risk legal compliance environments. Our policies and procedures require strict compliance by our associates and agents with all United States and local laws and regulations and consent orders applicable to our business operations, including those prohibiting improper payments to government officials. Nonetheless, we cannot assure you that our policies, procedures and related training programs will always ensure full compliance by our associates and agents with all applicable legal requirements. Improper conduct by our associates or agents could damage our reputation in the United States and internationally or lead to litigation or legal proceedings that could result in civil or criminal penalties, including substantial monetary fines as well as disgorgement of profits.
Failure to adequately protect, or disputes relating to, trademarks, formulae and other intellectual property rights could harm our business.
Our trademarks, formulae and other intellectual property rights (refer to the heading "Patents, Copyrights, Trade Secrets and Trademarks" in "Item 1. Business" above) are essential to the success of our business. We cannot be certain that the legal steps we are taking around the world are sufficient to protect our intellectual property rights or that, notwithstanding legal protection, others do not or will not infringe or misappropriate our intellectual property rights. If we fail to adequately protect our intellectual property rights, or if changes in laws diminish or remove the current legal protections available to them, the competitiveness of our products may be eroded and our business could suffer. In addition, we could come into conflict with third parties over intellectual property rights, which could result in disruptive and expensive litigation. Any of the foregoing could harm our business.
Adverse weather conditions could reduce the demand for our products.
The sales of our products are influenced to some extent by weather conditions in the markets in which we operate. Unusually cold or rainy weather during the summer months may have a temporary effect on the demand for our products and contribute to lower sales, which could have an adverse effect on our results of operations for such periods.

17



Climate change may have a long-term adverse impact on our business and results of operations.
There is increasing concern that a gradual increase in global average temperatures due to increased concentration of carbon dioxide and other greenhouse gases in the atmosphere will cause significant changes in weather patterns around the globe and an increase in the frequency and severity of natural disasters. Decreased agricultural productivity in certain regions of the world as a result of changing weather patterns may limit the availability or increase the cost of key agricultural commodities, such as sugarcane, corn, sugar beets, citrus, coffee and tea, which are important sources of ingredients for our products, and could impact the food security of communities around the world. Climate change may also exacerbate water scarcity and cause a further deterioration of water quality in affected regions, which could limit water availability for the Coca-Cola system’ssystem's bottling operations. Increased frequency or duration of extreme weather conditions could also impair production capabilities, disrupt our supply chain or impact demand for our products. As a result, the effects of climate change could have a long-term adverse impact on our business and results of operations.

17



If negative publicity, even if unwarranted, related to product safety or quality, human and workplace rights, obesity or other issues damages our brand image and corporate reputation, our business may suffer.
Our success depends in large part on our ability to maintain the brand image of our existing products, build up brand image for new products and brand extensions and maintain our corporate reputation. We cannot assure you, however, that our continuing investment in advertising and marketing and our strong commitment to product safety and quality and human rights will have the desired impact on our products’products' brand image and on consumer preferences. Product safety or quality issues, actual or perceived, or allegations of product contamination, even when false or unfounded, could tarnish the image of the affected brands and may cause consumers to choose other products. In some emerging markets, the production and sale of counterfeit or “spurious”"spurious" products, which we and our bottling partners may not be able to fully combat, may damage the image and reputation of our products. In addition, from time to time, we and our executives engage in public policy endeavors that are either directly related to our products and packaging or to our business operations and the general economic climate affecting the Company. These engagements in public policy debates can occasionally be the subject of backlash from advocacy groups that have a differing point of view and could result in adverse media and consumer reaction, including product boycotts. Similarly, our sponsorship relationships could subject us to negative publicity as a result of actual or alleged misconduct by individuals or entities associated with organizations we sponsor or support financially or through in-kind contributions. Likewise, campaigns by activists connecting us, or our bottling system or supply chain, with human and workplace rights issues in developing and emerging markets could adversely impact our corporate image and reputation. For example,Furthermore, in June 2011, the United Nations Human Rights Council endorsed the Guiding Principles on Business and Human Rights, which outlines how businesses should implement the corporate responsibility to respect human rights principles included in the United Nations “Protect,"Protect, Respect and Remedy”Remedy" framework on human rights. Through our Human Rights Policy, Code of Business Conduct and Supplier Guiding Principles, and our participation in the United Nations Global Compact, as well as our active participation in the Global Business Initiative on Human Rights and the Global Business Coalition Against Human Trafficking, we have made a number of commitments to respect all human rights. Allegations, even if untrue, that we are not respecting one or more of the 30 human rights found in the United Nations Universal Declaration of Human Rights; actual or perceived failure by our suppliers or other business partners to comply with applicable labor and workplace rights laws, including child labor laws, or their actual or perceived abuse or misuse of migrant workers; and adverse publicity surrounding obesity and health concerns related to our products, water usage, environmental impact, labor relations or the like could negatively affect our Company’sCompany's overall reputation and brand image, which in turn could have a negative impact on our products’ acceptance by consumers.
Changes in, or failure to comply with, the laws and regulations applicable to our products or our business operations could increase our costs or reduce our net operating revenues.
Our Company’sCompany's business is subject to various laws and regulations in the numerous countries throughout the world in which we do business, including laws and regulations relating to competition, product safety, advertising and labeling, container deposits, recycling orand product stewardship, the protection of the environment, and employment and labor practices. In the United States, the production, distribution, marketing and sale of many of our products are subject to, among others, the Federal Food, Drug, and Cosmetic Act, the Federal Trade Commission Act, the Lanham Act, state consumer protection laws, the Occupational Safety and Health Act, and various environmental statutes, as well as various state and local statutes and regulations. Outside the United States, the production, distribution sale, advertising and labelingsale of many of our products are also subject to various laws and regulations. Changes in applicable laws or regulations or evolving interpretations thereof, including increased government regulations to limit carbon dioxide and other greenhouse gas emissions as a result of concern over climate change, or regulations to limit or eliminate the use of bisphenol A, or BPA (an odorless, tasteless food-grade chemical commonly used in the food and beverage industries as a component in the coating of the interior of cans)can liners and other packaging materials), or regulations to limit or impose additional costs on commercial water use due to local water scarcity concerns, may result in increased compliance costs, capital expenditures and other financial obligations for us and our bottling partners, which could affect our profitability, or may impede the production, or distribution, marketing and sale of our products, which could affect our net operating revenues. In addition, failure to comply with environmental, health or safety requirements, U.S. trade sanctions, the U.S. Foreign Corrupt Practices Act and other applicable laws or regulations could result in the assessment of damages, the imposition of penalties, suspension of production or distribution, costly changes to

18



equipment or processes due to required corrective action, or a cessation or interruption of operations at our or our bottling partners’partners' facilities, as well as damage to our and the Coca-Cola system’ssystem's image and reputation, all of which could harm our and the Coca-Cola system’ssystem's profitability.

18



Changes in accounting standards could affect our reported financial results.
New accounting standards or pronouncements that may become applicable to our Company from time to time, or changes in the interpretation of existing standards and pronouncements, could have a significant effect on our reported financial results for the affected periods.
If we are not able to achieve our overall long-term growth objectives, the value of an investment in our Company could be negatively affected.
We have established and publicly announced certain long-term growth objectives. These objectives were based on, among other things, our evaluation of our growth prospects, which are generally driven by the sales potential of many product types, some of which are more profitable than others, and on an assessment of the potential price and product mix. There can be no assurance that we will realize the sales potential and the price and product mix necessary to achieve our long-term growth objectives.
If global credit market conditions deteriorate, our financial performance could be adversely affected.
The cost and availability of credit vary by market and are subject to changes in the global or regional economic environment. If conditions in major credit markets deteriorate, our and our bottling partners’partners' ability to obtain debt financing on favorable terms may be negatively affected, which could affect our and the Coca-Cola system’ssystem's profitability as well as our share of the income of bottling partners in which we have equity method investments. A decrease in availability of consumer credit resulting from unfavorable credit market conditions, as well as general unfavorable economic conditions, may also cause consumers to reduce their discretionary spending, which could reduce the demand for our beverages and negatively affect our net operating revenues and the Coca-Cola system’ssystem's profitability.
Default by or failure of one or more of our counterparty financial institutions could cause us to incur significant losses.
As part of our hedging activities, we enter into transactions involving derivative financial instruments, including forward contracts, commodity futures contracts, option contracts, collars and swaps, with various financial institutions. In addition, we have significant amounts of cash, cash equivalents and other investments on deposit or in accounts with banks or other financial institutions in the United States and abroad. As a result, we are exposed to the risk of default by or failure of counterparty financial institutions. The risk of counterparty default or failure may be heightened during economic downturns and periods of uncertainty in the financial markets. If one of our counterparties were to become insolvent or file for bankruptcy, our ability to recover losses incurred as a result of default or to retrieve our assets that are deposited or held in accounts with such counterparty may be limited by the counterparty’scounterparty's liquidity or the applicable laws governing the insolvency or bankruptcy proceedings. In the event of default by or failure of one or more of our counterparties, we could incur significant losses, which could negatively impact our results of operations and financial condition.
If we are unable to timely implement our previously announced actions to reinvigorate growth, or we do not realize the economic benefits we anticipate from these actions, our results of operations for future periods could be negatively affected.
In October 2014, we announced that we were taking actions to reinvigorate growth, including streamlining and simplifying our operating model to speed decision making and enhance local market focus; expanding our productivity and reinvestment program by targeting additional productivity; refocusing on our core business model, including refranchising the majority of Company-owned North America bottling territories by the end of 2017 and substantially all of the remaining territories no later than 2020;model; strategically targeting brand and growth investments that leverage our global strengths; and driving revenue and profit growth with clear portfolio roles across our markets while providing local operations with a clear line of sight and aligned compensation targets. We have begun implementing these actions and have incurred, and we expect will continue to incur, significant costs and expenses with the associated programs, initiatives and activities. In addition, in connection with refranchising transactions, we recorded, and we expect will continue to record, noncash losses related to the derecognition of intangible assets transferred or that will be transferred to bottling partners. If we are unable to implement some or all of these actions fully or in the envisioned timeframe, or otherwise we do not timely capture the efficiencies, cost savings and revenue growth opportunities we anticipate from these actions, our results of operations for future periods could be negatively affected.
If we fail to realize a significant portion of the anticipated benefits of our strategic relationshipsrelationship with Keurig and Monster, our financial performance could be adversely affected.
In February 2014, we entered into a 10-year global strategic agreement with Keurig to collaborate on the development and introduction of the Company's global brand portfolio for use in Keurig's forthcoming Keurig KoldTM at-home beverage system. In order to further align our long-term interests, since entering into the global strategic agreement we have acquired Keurig shares representing in the aggregate 16 percent of Keurig’s issued and outstanding common stock. In addition, in August 2014,

19



we entered into definitive agreements with Monster for a long-term strategic relationship in the global energy drink category, and upon the closing of the transactions contemplated by the agreements in June 2015 we will acquirepurchased newly issued shares representing approximately 16.717 percent of Monster’s issued and outstanding shares of common stock (after giving effect to the issuance). (For more information regarding our agreements with Monster and related transactions, refer to Note 2 of Notes to Consolidated Financial Statements set forth in Part II, "Item 8. Financial Statements and Supplementary Data" of this report.) If we are unable to successfully manage our complex relationshipsrelationship with Keurig and Monster; if the introduction of Keurig’s Keurig KoldTM beverage system is delayed or, when introduced, the Keurig KoldTM beverage system does not perform as expected;Monster, or if for any other reason we fail to realize all or a significant part of the benefits we expect from one or both of thesethis strategic relationshipsrelationship and the related investments,investment, our financial performance could be adversely affected.

19



If we are unable to renew collective bargaining agreements on satisfactory terms, or we or our bottling partners experience strikes, work stoppages or labor unrest, our business could suffer.
Many of our associates at our key manufacturing locations and bottling plants are covered by collective bargaining agreements. While we generally have been able to renegotiate collective bargaining agreements on satisfactory terms when they expire and regard our relations with associates and their representatives as generally satisfactory, negotiations in the current environment remain challenging, as the Company must have competitive cost structures in each market while meeting the compensation and benefits needs of our associates. If we are unable to renew collective bargaining agreements on satisfactory terms, our labor costs could increase, which could affect our profit margins. In addition, many of our bottling partners’partners' employees are represented by labor unions. Strikes, work stoppages or other forms of labor unrest at any of our major manufacturing facilities or at our bottling operations' or our major bottlers’bottlers' plants could impair our ability to supply concentrates and syrups to our bottling partners or our bottlers’bottlers' ability to supply finished beverages to customers, which could reduce our net operating revenues and could expose us to customer claims. Furthermore, from time to time we and our bottling partners restructure manufacturing and other operations to improve productivity. Restructuring activities and the announcement of plans for future restructuring activities may result in a general increase in insecurity among some Company associates and some employees in other parts of the Coca-Cola system, which may have negative implications on employee morale, work performance, escalation of grievances and successful negotiation of collective bargaining agreements. If these labor relations are not effectively managed at the local level, they could escalate in the form of corporate campaigns supported by the labor organizations and could negatively affect our Company's overall reputation and brand image, which in turn could have a negative impact on our products' acceptance by consumers.
We may be required to recognize impairment charges that could materially affect our financial results.
We assess our goodwill, trademarks and other intangible assets as well as our other long-lived assets as and when required by accounting principles generally accepted in the United States to determine whether they are impaired and, if they are, we record appropriate impairment charges. Our equity method investees also perform impairment tests, and we record our proportionate share of impairment charges recorded by them adjusted, as appropriate, for the impact of items such as basis differences, deferred taxes and deferred gains. It is possible that we may be required to record significant impairment charges or our proportionate share of significant impairment charges recorded by equity method investees in the future and, if we do so, our operating or equity income could be materially adversely affected.
We may incur multi-employer plan withdrawal liabilities in the future, which could negatively impact our financial performance.
We participate in certain multi-employer pension plans in the United States. Our U.S. multi-employer pension plan expense totaled $38$40 million in 2014.2015. The U.S. multi-employer pension plans in which we currently participate have contractual arrangements that extend into 2019.2020. If, in the future, we choose to withdraw from any of the multi-employer pension plans in which we currently participate, we will likelywould need to record the appropriate withdrawal liabilities at that time, which could negatively impact our financial performance in the applicable periods.
If we do not successfully integrate and manage our Company-owned or -controlled bottling operations or other acquired businesses or brands, our results could suffer.
From time to time we acquire or take control of bottling operations, often in underperforming markets where we believe we can use our resources and expertise to improve performance. In addition, we routinely evaluate opportunities to acquire other businesses or brands to expand our beverage portfolio and capabilities. We may incur unforeseen liabilities and obligations in connection with acquiring, taking control of or managing acquired bottling operations, other businesses or brands and may encounter unexpected difficulties and costs in restructuring and integrating them into our Company’sCompany's operating and internal control structures. We may also experience delays in extending our Company’sCompany's internal control over financial reporting to newly acquired or controlled bottling operations or other businesses, which may increase the risk of failure to prevent misstatements in such operations’their financial records and in our consolidated financial statements. Our financial performance depends in large part on how well we can manage and improve the performance of Company-owned or -controlled bottling operations.operations and other acquired businesses or brands. We cannot assure you, however, that we will be able to achieve our strategic and financial objectives for such bottling operations.operations or other acquisitions. If we are unable to achieve such objectives, our consolidated results could be negatively affected.

20



If we do not successfully manage our refranchising activities, our business and results of operations could be adversely affected.
As part of our strategic initiative to refocus on our core business of building brands and leading our system of bottling partners, we are accelerating our refranchising activities in North America and have expanded our refranchising efforts to Company-owned or -controlled bottling operations in Europe, Africa and China. Our refranchising activities require significant attention and effort on the part of, and therefore may become a distraction for, senior management. In addition, in connection with refranchising transactions in North America, we recorded, and we expect will continue to record, noncash losses related to the derecognition of intangible assets transferred or that will be transferred to bottling partners. There is no assurance that we will be able to complete refranchising transactions on our expected timetable and on terms and conditions favorable to us; that our refranchising bottling or joint venture partners will be efficient and aligned with our long-term vision for the Coca-Cola system; or that we will be able to maintain good relationships with the refranchised bottling operations. If we are unable to complete contemplated refranchising transactions timely, on favorable terms and with partners who share our long-term vision for the Coca-Cola system, our business and results of operations could be adversely affected.
If we are unable to successfully manage the possible negative consequences of our productivity initiatives, our business operations could be adversely affected.
We believe that improved productivity is essential to achieving our long-term growth objectives and, therefore, a leading priority of our Company is to design and implement the most effective and efficient business model possible. For information regarding our productivity initiatives, refer to the heading "Operations Review — Other Operating Charges — Productivity and Reinvestment Program" set forth in Part II, "Item 7. Management's Discussion and Analysis of Financial Condition and

20



Results of Operations" of this report. Some of the actions we are taking in furtherance of our productivity initiatives may become a distraction for our managers and employees and may disrupt our ongoing business operations; cause deterioration in employee morale which may make it more difficult for us to retain or attract qualified managers and employees; disrupt or weaken the internal control structures of the affected business operations; and give rise to negative publicity which could affect our corporate reputation. If we are unable to successfully manage the possible negative consequences of these actions, our business operations could be adversely affected.
If we are unable to attract or retain a highly skilled workforce, our business could be negatively affected.
The success of our business depends on our ability to attract, train, develop and retain a highly skilled workforce. We may not be able to successfully compete for and attract the high-quality and diverse employee talent we want and our future business needs may require. In addition, unexpected loss of experienced and highly skilled associates due to insecurity resulting from our ongoing productivity initiatives, refranchising transactions and organizational changes could deplete our institutional knowledge base and erode our competitiveness. Any of the foregoing could have a negative impact on our business.
Global or regional catastrophic events could impact our operations and financial results.
Because of our global presence and worldwide operations, our business can be affected by large-scale terrorist acts, especially those directed against the United States or other major industrialized countries; the outbreak or escalation of armed hostilities; major natural disasters; or widespread outbreaks of infectious diseases. Such events could impair our ability to manage our business around the world, could disrupt our supply of raw materials and ingredients, and could impact production, transportation and delivery of concentrates, syrups and finished products. In addition, such events could cause disruption of regional or global economic activity, which can affect consumers’consumers' purchasing power in the affected areas and, therefore, reduce demand for our products.
ITEM 1B.  UNRESOLVED STAFF COMMENTS
Not applicable.

21



ITEM 2.  PROPERTIES
Our worldwide headquarters is located on a 35-acre office complex in Atlanta, Georgia. The complex includes our 621,000 square foot headquarters building and an 870,000 square foot building in which our North America group’s main offices are located. The complex also includes several other buildings, including our 264,000 square foot Coca-Cola Plaza building, technical and engineering facilities and a reception center. We also own an office and retail building at 711 Fifth Avenue in New York, New York. These properties, except for the North America group’s main offices, are included in the Corporate operating segment.

We own or lease additional facilities, real estate and office space throughout the world which we use for administrative, manufacturing, processing, packaging, storage, warehousing, distribution and retail operations. These properties are generally included in the geographic operating segment in which they are located.

In the North America operating segment's geographic area, as of December 31, 2014,2015, we owned 6563 beverage production facilities, 10 principal beverage concentrate and/or syrup manufacturing plants, one facility that manufactures juice concentrates for foodservice use, and two bottled water facilities;facilities, and one container manufacturing facility; we leased one beverage production facility, one bottled water facility and four container manufacturing facilities; and we operated 260224 principal beverage distribution warehouses, of which 9880 were leased and the rest were owned. Also included in the North America operating segment is a portion of the Atlanta office complex consisting of the North America group’s main offices.

Additionally, outsideOutside of the North America operating segment's geographic area, as of December 31, 2014,2015, our Company owned and operated 18 principal beverage concentrate manufacturing plants, of which three are included in the Eurasia and Africa operating segment, three are included in the Europe operating segment, five are included in the Latin America operating segment, and seven are included in the Asia Pacific operating segment.

We own or hold a majority interest in or otherwise consolidate under applicable accounting rules bottling operations that, as of December 31, 2014,2015, owned 7976 principal beverage bottling and canning plants located throughout the world. These plants are included in the Bottling Investments operating segment.

Management believes that our Company’sCompany's facilities for the production of our products are suitable and adequate, that they are being appropriately utilized in line with past experience, and that they have sufficient production capacity for their present intended purposes. The extent of utilization of such facilities varies based upon seasonal demand for our products. However, management believes that additional production can be obtained at the existing facilities by adding personnel and capital equipment and, at some facilities, by adding shifts of personnel or expanding the facilities. We continuously review our anticipated requirements for facilities and, on the basis of that review, may from time to time acquire additional facilities and/or dispose of existing facilities.


21


ITEM 3.  LEGAL PROCEEDINGS
The Company is involved in various legal proceedings, including the proceedings specifically discussed below. Management believes that the total liabilities to the Company that may arise as a result of currently pending legal proceedings will not have a material adverse effect on the Company taken as a whole.
Aqua-Chem Litigation
On December 20, 2002, the Company filed a lawsuit (The Coca-Cola Company v. Aqua-Chem, Inc., Civil Action No. 2002CV631-50) in the Superior Court of Fulton County, Georgia (the "Georgia("Georgia Case"), seeking a declaratory judgment that the Company has no obligation to its former subsidiary, Aqua-Chem, Inc., now known as Cleaver-Brooks, Inc. ("Aqua-Chem"), for any past, present or future liabilities or expenses in connection with any claims or lawsuits against Aqua-Chem. Subsequent to the Company's filing but on the same day, Aqua-Chem filed a lawsuit (Aqua-Chem, Inc. v. The Coca-Cola Company, Civil Action No. 02CV012179) in the Circuit Court, Civil Division of Milwaukee County, Wisconsin (the "Wisconsin("Wisconsin Case"). In the Wisconsin Case, Aqua-Chem sought a declaratory judgment that the Company is responsible for all liabilities and expenses not covered by insurance in connection with certain of Aqua-Chem's general and product liability claims arising from occurrences prior to the Company's sale of Aqua-Chem in 1981, and a judgment for breach of contract in an amount exceeding $9 million for costs incurred by Aqua-Chem to date in connection with such claims. The Wisconsin Case initially was stayed, pending final resolution of the Georgia Case, and later was voluntarily dismissed without prejudice by Aqua-Chem.

22


The Company owned Aqua-Chem from 1970 to 1981. During that time, the Company purchased over $400 million of insurance coverage, which also insures Aqua-Chem for some of its prior and future costs for certain product liability and other claims. The Company sold Aqua-Chem to Lyonnaise American Holding, Inc., in 1981 under the terms of a stock sale agreement. The 1981 agreement, and a subsequent 1983 settlement agreement, outlined the parties' rights and obligations concerning past and future claims and lawsuits involving Aqua-Chem. Cleaver-Brooks, a division of Aqua-Chem, manufactured boilers, some of which contained asbestos gaskets. Aqua-Chem was first named as a defendant in asbestos lawsuits in or around 1985 and currently has approximately 40,000 active claims pending against it.
The parties agreed in 2004 to stay the Georgia Case pending the outcome of insurance coverage litigation filed by certain Aqua-Chem insurers on March 26, 2004. In the coverage action, five plaintiff insurance companies filed suit (Century Indemnity Company, et al. v. Aqua-Chem, Inc., The Coca-Cola Company, et al., Case No. 04CV002852) in the Circuit Court, Civil Division of Milwaukee County, Wisconsin, against the Company, Aqua-Chem and 16 insurance companies. Several of the policies that were the subject of the coverage action had been issued to the Company during the period (1970 to 1981) when the Company owned Aqua-Chem. The complaint sought a determination of the respective rights and obligations under the insurance policies issued with regard to asbestos-related claims against Aqua-Chem. The action also sought a monetary judgment reimbursing any amounts paid by the plaintiffs in excess of their obligations. Two of the insurers, one with a $15 million policy limit and one with a $25 million policy limit, asserted cross-claims against the Company, alleging that the Company and/or its insurers are responsible for Aqua-Chem's asbestos liabilities before any obligation is triggered on the part of the cross-claimant insurers to pay for such costs under their policies.
Aqua-Chem and the Company filed and obtained a partial summary judgment determination in the coverage action that the insurers for Aqua-Chem and the Company were jointly and severally liable for coverage amounts, but reserving judgment on other defenses that might apply. During the course of the Wisconsin insurance coverage litigation, Aqua-Chem and the Company reached settlements with several of the insurers, including plaintiffs, who have paid or will pay funds into an escrow account for payment of costs arising from the asbestos claims against Aqua-Chem. On July 24, 2007, the Wisconsin trial court entered a final declaratory judgment regarding the rights and obligations of the parties under the insurance policies issued by the remaining defendant insurers, which judgment was not appealed. The judgment directs, among other things, that each insurer whose policy is triggered is jointly and severally liable for 100 percent of Aqua-Chem's losses up to policy limits. The court's judgment concluded the Wisconsin insurance coverage litigation.
The Company and Aqua-Chem continued to pursue and obtain coverage agreements for the asbestos-related claims against Aqua-Chem with those insurance companies that did not settle in the Wisconsin insurance coverage litigation. The Company anticipated that a final settlement with three of those insurers (the “Chartis insurers”("Chartis insurers") would be finalized in May 2011, but the Chartis insurers repudiated their settlement commitments and, as a result, Aqua-Chem and the Company filed suit against them in Wisconsin state court to enforce the coverage-in-place settlement or, in the alternative, to obtain a declaratory judgment validating Aqua-Chem and the Company's interpretation of the court's judgment in the Wisconsin insurance coverage litigation.
In February 2012, the parties filed and argued a number of cross-motions for summary judgment related to the issues of the enforceability of the settlement agreement and the exhaustion of policies underlying those of the Chartis insurers. The court granted defendants' motions for summary judgment that the 2011 Settlement Agreement and 2010 Term Sheet were not binding contracts, but denied their similar motions related to plaintiffs' claims for promissory and/or equitable estoppel. On or about

22


May 15, 2012, the parties entered into a mutually agreeable settlement/stipulation resolving two major issues: exhaustion of underlying coverage and control of defense. On or about January 10, 2013, the parties reached a settlement of the estoppel claims and all of the remaining coverage issues, with the exception of one disputed issue relating to the scope of the Chartis insurers' defense obligations in two policy years. The trial court granted summary judgment in favor of the Company and Aqua-Chem on that one open issue and entered a final appealable judgment to that effect following the parties' settlement. On January 23, 2013, the Chartis insurers filed a notice of appeal of the trial court's summary judgment ruling. On October 29, 2013, the Wisconsin Court of Appeals affirmed the grant of summary judgment in favor of the Company and Aqua-Chem. On November 27, 2013, the Chartis insurers filed a petition for review in the Supreme Court of Wisconsin, and on December 11, 2013, the Company filed its opposition to that petition. On April 16, 2014, the Supreme Court of Wisconsin denied the Chartis insurers' petition for review.
The Georgia Case remains subject to the stay agreed to in 2004.

Environmental Matter
23


U.S. Federal Income Tax Dispute
On September 17, 2015, the Company received a Statutory Notice of Deficiency ("Notice") from the IRS for the tax years 2007 through 2009, after a five-year audit. In the Notice, the IRS claims that the Company's United States taxable income should be increased by an amount that creates a potential additional federal income tax liability of approximately $3.3 billion for the period, plus interest. No penalties were asserted in the Notice; however, the IRS has since taken the position that it is not precluded from asserting penalties and notified the Company that it may do so. The disputed amounts largely relate to a transfer pricing matter involving the appropriate amount of taxable income the Company should report in the United States in connection with its licensing of intangible property to certain related foreign licensees for use in connection with the manufacturing, distribution, sale, marketing and promotion of products in overseas markets.
The Company has followed the same transfer pricing methodology for these licenses since the methodology was agreed with the IRS in a 1996 closing agreement that applied back to 1987. The closing agreement provides prospective penalty protection as long as the Company follows the prescribed methodology and material facts and circumstances and relevant Federal tax law have not changed. On February 11, 2016, the IRS notified the Company, without further explanation, that the IRS has determined that material facts and circumstances and relevant Federal tax law have changed and that it may assert penalties. The Company does not agree with this determination. The Company's Atlanta Syrup Plant (“ASP”) discharges wastewater tocompliance with the closing agreement was audited and confirmed by the IRS in five successive audit cycles covering the subsequent 11 years through 2006, with the last audit concluding as recently as 2009.
The Notice represents a Cityrepudiation of Atlanta wastewater treatment works pursuant to a government-issued permitthe methodology previously adopted in the 1996 closing agreement. The IRS designated the matter for litigation on October 15, 2015. Therefore, the Company will be prevented from pursuing any administrative settlement at IRS Appeals or under the U.S. Clean Water ActIRS Advance Pricing and related state and local laws and regulations. Mutual Agreement Program.
The Company became awarefirmly believes that wastewater-related reportsthe IRS' claims are without merit and plans to pursue all available administrative and judicial remedies necessary to resolve this matter. To that end, the Company filed by ASP with regulators may contain certain inaccurate information anda petition in November 2012 made self-disclosure to the City of Atlanta regarding the matter as required by applicable law. As a result, regulatory authorities are seeking monetary and/or other sanctions against the Company.U.S. Tax Court on December 14, 2015. The Company intends to vigorously defend its position and is confident in its ability to prevail on the process of negotiating a mutually acceptable settlement with the regulatory authorities and believes that any sanctions that may ultimately be imposed will not be material to its business, financial condition or results of operations.merits.
ITEM 4.  MINE SAFETY DISCLOSURES
Not applicable.
ITEM X.  EXECUTIVE OFFICERS OF THE COMPANY
The following are the executive officers of our Company as of February 25, 2015:
Ahmet C. Bozer, 54, is Executive Vice President of the Company and President of Coca-Cola International, which consists of the Company's Eurasia and Africa, Europe, Latin America and Asia Pacific operating groups. Mr. Bozer joined the Company in 1990 as a Financial Control Manager. In 1992, he became the Region Finance Manager in Turkey. In 1994, he joined Coca-Cola Bottlers of Turkey (now Coca-Cola İçecek A.Ş.) as Finance Director and was named Managing Director in 1998. In 2000, Mr. Bozer rejoined the Company as President of the Eurasia Division, which became the Eurasia and Middle East Division in 2003. In 2006, Mr. Bozer assumed the additional leadership responsibility for the Russia, Ukraine and Belarus Division. In 2007, with the addition of the India and South West Asia Division under his responsibilities, Mr. Bozer was named President of the Eurasia Group. From July 1, 2008, until December 31, 2012, Mr. Bozer served as President of the Eurasia and Africa Group. He was appointed President of Coca-Cola International effective January 1, 2013, and was elected Executive Vice President of the Company on February 21, 2013.2016:
Alexander B. Cummings, Jr., 58,59, is Executive Vice President and Chief Administrative Officer of the Company. Mr. Cummings joined the Company in 1997 as Deputy Region Manager, Nigeria. In 1998, Mr. Cummings was named Managing Director/Region Manager, Nigeria, and in 2000, he became President of the North West Africa Division based in Morocco. In 2001, Mr. Cummings became President of the Africa Group and served in this capacity until June 2008. Mr. Cummings was appointed Chief Administrative Officer of the Company effective July 1, 2008, and was elected Executive Vice President of the Company effective October 15, 2008. Mr. Cummings will be retiring from the Company on March 31, 2016.
Marcos de Quinto, 56,57, is Executive Vice President and Chief Marketing Officer of the Company. Mr. De Quinto first joined the Company in 1982 in the marketing department of Coca-Cola Spain, where he held positions including District Manager and Merchandising Manager. In 1988, he left the Company to be Regional Manager for Southern Publicity Agencies ALAS BATES/BSB Advertising before rejoining Coca-Cola Spain in 1990 as Marketing Services Manager. From September 1992 to September 1994, Mr. De Quinto served as Senior Vice President, Marketing Operations Manager, Coca-Cola Southeast and West Asia, and from September 1994 to February 1995, he served as Regional Manager for Singapore and Malaysia. From February 1995 to October 1996, Mr. De Quinto served as Marketing Manager, Central Europe Division, and from October 1996 to January 2000, he served as Regional Manager, Coca-Cola Spain. In January 2000, he was appointed President of the Iberia Business Unit and served in that role until his appointment to the position of Chief Marketing Officer effective January 1, 2015. He also served as Vice President, Europe Group from May 2007 to December 2012. Mr. De Quinto was elected Executive Vice President of the Company effective February 19, 2015.

2324



J. Alexander M. Douglas, Jr., 53,54, is SeniorExecutive Vice President and Global Chief Customer Officer of the Company and President of Coca-Cola North America. Mr. Douglas joined the Company in January 1988 as a District Sales Manager for the Foodservice Division of Coca-Cola USA. In May 1994, he was named Vice President of Coca-Cola USA, initially assuming leadership of the CCE Sales and Marketing Group and eventually assuming leadership of the entire North American Field Sales and Marketing Groups. In 2000, Mr. Douglas was appointed President of the North American Retail Division within the North America Group. He served as Senior Vice President and Chief Customer Officer of the Company from 2003 until 2006 and continued serving as Senior Vice President until April 2007. Mr. Douglas was President of the North America Group from August 2006 through December 31, 2012. He was appointedserved as Global Chief Customer Officer effectiveof the Company from January 1, 2013 was electedthrough March 2015 and as Senior Vice President of the Company onfrom February 21, 2013 anduntil his election as Executive Vice President of the Company effective April 30, 2015. Mr. Douglas was appointed President of Coca-Cola North America effective January 1, 2014.
Ceree Eberly, 52,53, is Senior Vice President and Chief People Officer of the Company, with responsibility for leading the Company's global People Function. Ms. Eberly joined the Company in 1990, serving in staffing, compensation and other roles supporting the Company's divisions around the world. From 1998 until 2003, she served as Human Resources Director for the Latin Center Division. From 2003 until 2007, Ms. Eberly served as Vice President of the McDonald's Division. She was appointed Group Human Resources Director for Europe in July 2007 and served in that capacity until she was appointed Chief People Officer effective December 1, 2009. Ms. Eberly was elected Senior Vice President of the Company effective April 1, 2010.
Irial Finan, 57,58, is Executive Vice President and President, Bottling Investments and Supply Chain. Mr. Finan joined the Company and was named President, Bottling Investments in 2004. Mr. Finan joined the Coca-Cola system in 1981 with Coca-Cola Bottlers Ireland, Ltd., where for several years he held a variety of accounting positions. From 1987 until 1990, Mr. Finan served as Finance Director of Coca-Cola Bottlers Ireland, Ltd. From 1991 to 1993, he served as Managing Director of Coca-Cola Bottlers Ulster, Ltd. He was Managing Director of Coca-Cola bottlers in Romania and Bulgaria until late 1994. From 1995 to 1999, he served as Managing Director of Molino Beverages, with responsibility for expanding markets, including the Republic of Ireland, Northern Ireland, Romania, Moldova, Russia and Nigeria. Mr. Finan served from 2001 until 2003 as Chief Executive Officer of Coca-Cola Hellenic. He was elected Executive Vice President of the Company in October 2004.
Bernhard Goepelt, 52,53, is Senior Vice President, General Counsel and Chief Legal Counsel of the Company. Mr. Goepelt joined the Company in 1992 as Legal Counsel for the German Division. In 1997, he was appointed Legal Counsel for the Middle and Far East Group and in 1999 was appointed Division Counsel, Southeast and West Asia Division, based in Thailand. In 2003, Mr. Goepelt was appointed Group Counsel for the Central Europe, Eurasia and Middle East Group. In 2005, he assumed the position of General Counsel for Japan and China, and in 2007, Mr. Goepelt was appointed General Counsel, Pacific Group. In April 2010, he moved to Atlanta, Georgia, to become Associate General Counsel, Global Marketing, Commercial Leadership & Strategy. In September 2010, Mr. Goepelt took on the additional responsibility of General Counsel for the Pacific Group. In addition to his functional responsibilities, he also managed the administration of the Legal Division. Mr. Goepelt was elected Senior Vice President, General Counsel and Chief Legal Counsel of the Company in December 2011.
Julie Hamilton, 50, is Senior Vice President and Chief Customer and Commercial Leadership Officer of the Company. Ms. Hamilton joined the Company in 1996 as Brand Development Manager of Still Beverages with Coca-Cola USA. From January 1998 to April 1999, she served as Franchise Manager of Independent Bottlers with Coca-Cola USA, and from April 1999 to October 2000, she served as Group Manager for the Worldwide Marketing Partnership with Blockbuster. From October 2000 to January 2003, Ms. Hamilton served as Director of Franchise Sales & Marketing-Northwest U.S. Region. From January 2003 to October 2005, she served as Group Directorfor Global On-Premise Customers, and from October 2005 to June 2007, she served as Vice President, Global Customer Development. She served as Group Vice President, North America Wal-Mart Team from June 2007 to January 2009, and as President of the Global Wal-Mart Group from January 2009 to March 2011. She was appointed Executive Assistant to Muhtar Kent, the Chairman and Chief Executive Officer of the Company, in March 2011 and served in that capacity until she was appointed Chief Customer and Commercial Leadership Officer effective April 1, 2015. Ms. Hamilton was elected Vice President of the Company in April 2015 and Senior Vice President effective February 18, 2016.
Brent Hastie, 41,42, is Senior Vice President, Strategy and Planning for the Company. Mr. Hastie first joined the Company in 2006 as Vice President, Strategy and Planning for Coca‑ColaCoca-Cola North America. From March 2009 to July 2009, he served as Vice President, Commercial Leadership, Still Beverages. From August 2009 to December 2010, he served as President and General Manager, Active Lifestyles Brands. From January 2011 to April 2012, he served as Chief Strategy Officer for Coca-Cola Refreshments.CCR. In April 2012, he left the Company to join Bain Capital, a global private investment firm, where he was Executive Vice President in the Private Equity group until July 2013, when he returned to the Company as Vice President, Strategy and Planning. Mr. Hastie was appointed to his current positionelected Senior Vice President of the Company effective JulyFebruary 18, 2013. Prior to joining2016.

25



Ed Hays, PhD, 57, is Senior Vice President and Chief Technical Officer of the Company. Dr. Hays joined the Company in 2006, Mr. Hastie was1985 as a Principal with McKinsey & Company, a global management consulting firm, where he workedscientist in Corporate Research and Development. He served as Director of Product Development in Corporate Research and Development from 1992 to 1995 and as Director, Research and Development for the Middle East and Far East Group from August 1995 to January 1998. He served as Director of Corporate Research and Development from July 19951998 to June 1997December 1999. He was named Vice President, Global Science, Regulatory and again from August 1999Formula Governance in December 2000 and served in that role until his appointment as Chief Technical Officer of the Company effective March 1, 2015. He continued to serve as Vice President until his election as Senior Vice President of the Company effective April 2006.30, 2015.

Nathan Kalumbu, 50,51, is President of the Eurasia and Africa Group. Mr. Kalumbu joined the Company in 1990 as the Central Africa region's External Affairs Manager and served in numerous roles in marketing operations and country management in Zimbabwe, Zambia and Malawi from 1992 to 1996. He held the role of Executive Assistant to the South Africa Division President from 1997 to 1998 and Region Manager for Central Africa from 1998 to 2000 and for Nigeria from 2000 to 2004. In 2004, Mr. Kalumbu was appointed Business Planning Director and Executive Assistant to the Retail Division President, North America. He returned to the Africa Group as Director of Business Strategy and Planning for the East and Central Africa Division in 2006. In 2007, he was named President of the Central, East and West Africa (CEWA) business unit and served in that role until his appointment to his current position effective January 1, 2013.

Muhtar Kent, 62,63, is Chairman of the Board of Directors and Chief Executive Officer and President of the Company. Mr. Kent joined the Company in 1978 and held a variety of marketing and operations roles throughout his career with the Company. In

24



1985, he was appointed General Manager of Coca-Cola Turkey and Central Asia. From 1989 to 1995, Mr. Kent served as President of the East Central Europe Division and Senior Vice President of Coca-Cola International. Between 1995 and 1998, he served as Managing Director of Coca-Cola Amatil-Europe, covering bottling operations in 12 countries, and from 1999 until 2005, he served as President and Chief Executive Officer of Efes Beverage Group, a diversified beverage company with Coca-Cola and beer operations across Southeast Europe, Turkey and Central Asia. Mr. Kent rejoined the Company in May 2005 as President and Chief Operating Officer, North Asia, Eurasia and Middle East Group, an organization serving a broad and diverse region that included China, Japan and Russia. He was appointed President, Coca-Cola International in January 2006 and was elected Executive Vice President of the Company in February 2006. He was elected President and Chief Operating Officer of the Company in December 2006 and was elected to the Board of Directors in April 2008. Mr. Kent was elected Chief Executive Officer of the Company effective July 1, 2008, and was elected Chairman of the Board of Directors of the Company in April 2009. He served as President of the Company until August 2015.
James Quincey, 50,51, is President and Chief Operating Officer of the Europe Group.Company. Mr. Quincey joined the Company in 1996 as Director, Learning Strategy for the Latin America Group. He moved to Mexico as Deputy to the Division President in 1999, became Region Manager for Argentina and Uruguay in 2000, and then served as General Manager of the South Cone region (Argentina, Chile, Uruguay and Paraguay) in 2003. Mr. Quincey was appointed President of the South Latin Division in December 2003 and President of the Mexico Division in December 2005. In October 2008, he was named President of the Northwest Europe and Nordics business unit and served in that role until his appointmenthe was appointed President of the Europe Group in January 2013. He was elected to his current position effective January 1, 2013.positions in August 2015.
Atul Singh, 55,56, is President of the Asia Pacific Group. Mr. Singh joined the Company in 1998 as Vice President, Operations of the India Division. In 2001, he moved to the China Division and served as Region Manager of East China from 2001 to 2002, Vice President of Operations from 2002 to 2003, Deputy Division President of the China Division from 2003 to 2004 and President of the East, Central and South China Division from January to August 2005. From September 2005 to June 2013, he served as President of the India and South West Asia business unit. Mr. Singh served as Deputy President, Pacific Group, from July 2013 to December 2013 and served as Group President, Asia, which is part of the Asia Pacific Group, from January 2014 to August 2014. Mr. Singh was appointed to his current position effectivein September 1, 2014.

Brian Smith, 59,60, is President of the Latin America Group. Mr. Smith joined the Company in 1997 as Latin America Group Manager for Mergers and Acquisitions, a role he held until July 2001. From 2001 to 2002, he worked as Executive Assistant to Brian Dyson, then Chief Operating Officer and Vice Chairman of the Company. Mr. Smith served as President of the Brazil Division from 2002 to 2008 and President of the Mexico business unit from 2008 through December 2012. Mr. Smith was appointed to his current position effective January 1, 2013.

26



Ed Steinike, 58, is Senior Vice President and Chief Information Officer of the Company. He joined the Company in 2002 as Chief Technology Officer. From May 2004 to November 2007, Mr. Steinike served as Chief Development Officer and Chief Information Officer for Coca-Cola North America. From February 2007 to November 2007, he served as Vice President of the Company. From November 2007 to April 2010, he served as Executive Vice President and Chief Information Officer at ING Insurance, part of ING Groep N.V. He rejoined the Company in April 2010 as Chief Information Officer and was elected Vice President in July 2010. He was elected Senior Vice President in December 2013. 
Clyde C. Tuggle, 52,53, is Senior Vice President and Chief Public Affairs and Communications Officer of the Company. Mr. Tuggle joined the Company in 1989 in the Corporate Issues Communications Department. In 1992, he was named Executive Assistant to Roberto C. Goizueta, then Chairman and Chief Executive Officer of the Company, where he managed external affairs and communications for the Office of the Chairman. In 1998, Mr. Tuggle transferred to the Company's Central European Division Office in Vienna, where he held a variety of positions, including Director of Operations Development, Deputy to the Division President and Region Manager for Austria. In 2000, Mr. Tuggle returned to Atlanta, Georgia, as Executive Assistant to then Chairman and Chief Executive Officer Douglas N. Daft and was elected Vice President of the Company. In February 2003, he was elected Senior Vice President of the Company and appointed Director of Worldwide Public Affairs and Communications. From 2005 until September 2008, Mr. Tuggle served as President of the Russia, Ukraine and Belarus Division. In September 2008, he returned to Atlanta, Georgia, to lead the Company’sCompany's productivity efforts and oversee the Company’sCompany's Public Affairs and Communications and Strategic Security and Aviation functions. Mr. Tuggle was elected Senior Vice President in October 2008 and in May 2009 was named to his current position.
Kathy N. Waller, 56,57, is Executive Vice President and Chief Financial Officer of the Company. Ms. Waller joined the Company in 1987 as a senior accountant in the Accounting Research Department and has served in a number of accounting and finance roles of increasing responsibility. From July 2004 to August 2009, Ms. Waller served as Chief of Internal Audit. In December 2005, she was elected Vice President of the Company, and in August 2009, she was elected Controller. In August 2013, she became Vice President, Finance and Controller, assuming additional responsibilities for corporate treasury, corporate tax and finance capabilities, and served in that position until April 23, 2014, when she was appointed Chief Financial Officer and elected Executive Vice President.

All executive officers serve at the pleasure of the Board of Directors. There is no family relationship between any of the Directors or executive officers of the Company.

2527



PART II
ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
The principal United States market in which the Company's common stock is listed and traded is the New York Stock Exchange.
The following table sets forth, for the quarterly reporting periods indicated, the high and low market prices per share for the Company's common stock, as reported on the New York Stock Exchange composite tape, and dividend per share information:
Common Stock
Market Prices
  
Common Stock
Market Prices
  
High
 Low
 
Dividends
Declared

High
 Low
 
Dividends
Declared

2015     
Fourth quarter$43.91
 $40.43
 $0.330
Third quarter42.25
 36.56
 0.330
Second quarter41.69
 39.12
 0.330
First quarter43.83
 39.61
 0.330
2014          
Fourth quarter$45.00
 $39.80
 $0.305
$45.00
 $39.80
 $0.305
Third quarter42.57
 39.06
 0.305
42.57
 39.06
 0.305
Second quarter42.29
 38.04
 0.305
42.29
 38.04
 0.305
First quarter41.23
 36.89
 0.305
41.23
 36.89
 0.305
2013     
Fourth quarter$41.39
 $36.83
 $0.280
Third quarter41.25
 37.80
 0.280
Second quarter43.43
 38.97
 0.280
First quarter40.70
 36.52
 0.280
While we have historically paid dividends to holders of our common stock on a quarterly basis, the declaration and payment of future dividends will depend on many factors, including, but not limited to, our earnings, financial condition, business development needs and regulatory considerations, and are at the discretion of our Board of Directors.
As of February 23, 2015,22, 2016, there were 232,496224,780 shareowner accounts of record. This figure does not include a substantially greater number of "street name" holders or beneficial holders of our common stock, whose shares are held of record by banks, brokers and other financial institutions.
The information under the principal heading "EQUITY COMPENSATION PLAN INFORMATION" in the Company's definitive Proxy Statement for the Annual Meeting of Shareowners to be held on April 29, 201527, 2016, to be filed with the Securities and Exchange Commission (the "Company's 2015("Company's 2016 Proxy Statement"), is incorporated herein by reference.
During the fiscal year ended December 31, 20142015, no equity securities of the Company were sold by the Company that were not registered under the Securities Act of 1933, as amended.

2628



The following table presents information with respect to purchases of common stock of the Company made during the three months ended December 31, 20142015, by the Company or any "affiliated purchaser" of the Company as defined in Rule 10b-18(a)(3) under the Exchange Act.
Period
Total Number of
Shares Purchased1

 
Average
Price Paid
Per Share

 
Total Number of
Shares Purchased
as Part of Publicly
Announced Plan2

 
Maximum Number of
Shares That May
Yet Be Purchased
Under the Publicly
Announced Plan

September 27, 2014 through October 24, 20145,150,833
 $42.03
 5,150,833
 345,200,820
October 25, 2014 through November 21, 20149,997,513
 42.25
 9,967,698
 335,233,122
November 22, 2014 through December 31, 201411,721,766
 42.77
 11,707,800
 323,525,322
Total26,870,112
 $42.43
 26,826,331
  
Period
Total Number of
Shares Purchased1

 
Average
Price Paid
Per Share

 
Total Number of
Shares Purchased
as Part of Publicly
Announced Plan2

 
Maximum Number of
Shares That May
Yet Be Purchased
Under the Publicly
Announced Plan

October 3, 2015 through October 30, 20156,247,561
 $42.50
 6,024,200
 268,168,951
October 31, 2015 through November 27, 201522,030,953
 42.28
 22,027,278
 246,141,673
November 28, 2015 through December 31, 20158,210,439
 42.95
 8,209,731
 237,931,942
Total36,488,953
 $42.47
 36,261,209
  
1 
The total number of shares purchased includes: (i) shares purchased pursuant to the 2012 Plan described in footnote 2 below, and (ii) shares surrendered to the Company to pay the exercise price and/or to satisfy tax withholding obligations in connection with so-called stock swap exercises of employee stock options and/or the vesting of restricted stock issued to employees, totaling zero223,361 shares, 29,8153,675 shares and 13,966708 shares for the fiscal months of October, November and December 2014,2015, respectively.
2 
On October 18, 2012, the Company publicly announced that our Board of Directors had authorized a plan (the "2012("2012 Plan") for the Company to purchase up to 500 million shares of our Company's common stock. This column discloses the number of shares purchased pursuant to the 2012 Plan during the indicated time periods (including shares purchased pursuant to the terms of preset trading plans meeting the requirements of Rule 10b5-1 under the Exchange Act).


2729



Performance Graph
Comparison of Five-Year Cumulative Total Return Among
The Coca-Cola Company, the Peer Group Index and the S&P 500 Index
Total Return
Stock Price Plus Reinvested Dividends

December 31,2009
2010
2011
2012
2013
2014
2010
2011
2012
2013
2014
2015
The Coca-Cola Company$100
$119
$130
$139
$163
$171
$100
$109
$117
$137
$144
$151
Peer Group Index100
119
142
156
198
229
100
119
131
166
191
218
S&P 500 Index100
115
117
136
180
205
100
102
118
157
178
181
The total return assumes that dividends were reinvested daily and is based on a $100 investment on December 31, 2009.2010.
The Peer Group Index is a self-constructed peer group of companies that are included in the Dow Jones Food and Beverage Group and the Dow Jones Tobacco Group of companies, from which the Company has been excluded.
The Peer Group Index consists of the following companies: Altria Group, Inc., Archer Daniels Midland Company, B&G Foods, Inc., Brown-Forman Corporation, Bunge Limited, Campbell Soup Company, Coca-Cola Enterprises, Inc., ConAgra Foods, Inc., Constellation Brands, Inc., Darling Ingredients Inc., Dean Foods Company, Dr Pepper Snapple Group, Inc., Flowers Foods, Inc., General Mills, Inc., The Hain Celestial Group, Inc., Herbalife Ltd., The Hershey Company, Hormel Foods Corporation, Ingredion Incorporated, The J.M. Smucker Company, Kellogg Company, Keurig Green Mountain, Inc., The Kraft Foods Inc.,Heinz Company, Lancaster Colony Corporation, Leucadia National Corporation, Lorillard, Inc., McCormick & Company, Inc., Mead Johnson Nutrition Company, Molson Coors Brewing Company, Mondelēz International, Inc., Monster Beverage Corporation, PepsiCo, Inc., Philip Morris International Inc., Pinnacle Foods Inc., Post Holdings, Inc., Reynolds American Inc., TreeHouse Foods, Inc., Tyson Foods, Inc., and The WhiteWave Foods Company.
Companies included in the Dow Jones Food and Beverage Group and the Dow Jones Tobacco Group change periodically. This year, the groups include Pinnacle Foods Inc., which was not included in the groups last year. Additionally, the groups do not include BeamLorillard, Inc., The Hillshire Brands Company and Universal Corporation, all of which werewas included in the groups last year.

2830



ITEM 6.  SELECTED FINANCIAL DATA
The following selected financial data should be read in conjunction with "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" and consolidated financial statements and notes thereto contained in "Item 8. Financial Statements and Supplementary Data" of this report.
Year Ended December 31,2014
 
2013 1

 2012
 2011
 
2010 2

2015
 2014
 2013
 2012
 2011
(In millions except per share data)      
SUMMARY OF OPERATIONS                  
Net operating revenues$45,998
 $46,854
 $48,017
 $46,542
 $35,119
$44,294
 $45,998
 $46,854
 $48,017
 $46,542
Net income attributable to shareowners of
The Coca-Cola Company
7,098
 8,584
 9,019
 8,584
 11,787
7,351
 7,098
 8,584
 9,019
 8,584
PER SHARE DATA                  
Basic net income$1.62
 $1.94
 $2.00
 $1.88
 $2.55
$1.69
 $1.62
 $1.94
 $2.00
 $1.88
Diluted net income1.60
 1.90
 1.97
 1.85
 2.53
1.67
 1.60
 1.90
 1.97
 1.85
Cash dividends1.22
 1.12
 1.02
 0.94
 0.88
1.32
 1.22
 1.12
 1.02
 0.94
BALANCE SHEET DATA                  
Total assets$92,023
 $90,055
 $86,174
 $79,974
 $72,921
$90,093
 $92,023
 $90,055
 $86,174
 $79,974
Long-term debt19,063
 19,154
 14,736
 13,656
 14,041
28,407
 19,063
 19,154
 14,736
 13,656
1
Includes the impact of the deconsolidation of the Brazilian and Philippine bottling operations. Refer to Note 2 of Notes to Consolidated Financial Statements.
2
On October 2, 2010, the Company acquired CCE's former North America business and sold our Norwegian and Swedish bottling operations to New CCE.
The Company's results are impacted by acquisitions and divestitures. Refer to "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" for additional information.
ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Overview
The following Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to help the reader understand The Coca-Cola Company, our operations and our present business environment. MD&A is provided as a supplement to — and should be read in conjunction with — our consolidated financial statements and the accompanying notes thereto contained in "Item 8. Financial Statements and Supplementary Data" of this report. This overview summarizes the MD&A, which includes the following sections:
Our Business — a general description of our business and the nonalcoholic beverage segment of the commercial beverage industry,industry; our objective,objective; our strategic priorities,priorities; our core capabilities,capabilities; and challenges and risks of our business.
Critical Accounting Policies and Estimates — a discussion of accounting policies that require critical judgments and estimates.
Operations Review — an analysis of our Company's consolidated results of operations for the three years presented in our consolidated financial statements. Except to the extent that differences among our operating segments are material to an understanding of our business as a whole, we present the discussion in the MD&A on a consolidated basis.
Liquidity, Capital Resources and Financial Position — an analysis of cash flows; off-balance sheet arrangements and aggregate contractual obligations; foreign exchange; the impact of inflation and changing prices; and an overview of financial position.

2931



Our Business
General
The Coca-Cola Company is the world's largest beverage company. We own or license and market more than 500 nonalcoholic beverage brands, primarily sparkling beverages but also a variety of still beverages such as waters, enhanced waters, juices and juice drinks, ready-to-drink teas and coffees, and energy and sports drinks. We own and market four of the world's top five nonalcoholic sparkling beverage brands: Coca-Cola, Diet Coke, Fanta and Sprite. Finished beverage products bearing our trademarks, sold in the United States since 1886, are now sold in more than 200 countries.
We make our branded beverage products available to consumers throughout the world through our network of Company-owned or -controlled bottling and distribution operations, bottling partners, distributors, wholesalers and retailers — the world's largest beverage distribution system. Beverages bearing trademarks owned by or licensed to us account for more than 1.9 billion of the approximately 5758 billion servings of all beverages consumed worldwide every day.
We believe our success depends on our ability to connect with consumers by providing them with a wide variety of choices to meet their desires, needs and lifestyle choices. Our success further depends on the ability of our people to execute effectively, every day.
Our goal is to use our Company's assets — our brands, financial strength, unrivaled distribution system, global reach, and the talent and strong commitment of our management and associates — to become more competitive and to accelerate growth in a manner that creates value for our shareowners.
Our Company markets, manufactures and sells:
beverage concentrates, sometimes referred to as "beverage bases," and syrups, including fountain syrups (we refer to this part of our business as our "concentrate business" or "concentrate operations"); and
finished sparkling and still beverages (we refer to this part of our business as our "finished product business" or "finished product operations").
Generally, finished product operations generate higher net operating revenues but lower gross profit margins than concentrate operations.
In our concentrate operations, we typically generate net operating revenues by selling concentrates and syrups to authorized bottling and canning operations (to which we typically refer as our "bottlers" or our "bottling partners"). Our bottling partners either combine the concentrates with sweeteners (depending on the product), still water and/or sparkling water, or combine the syrups with sparkling water to produce finished beverages. The finished beverages are packaged in authorized containers — such as cans and refillable and nonrefillable glass and plastic bottles — bearing our trademarks or trademarks licensed to us and are then sold to retailers directly or, in some cases, through wholesalers or other bottlers. Outside the United States, we also sell concentrates for fountain beverages to our bottling partners who are typically authorized to manufacture fountain syrups, which they sell to fountain retailers such as restaurants and convenience stores which use the fountain syrups to produce beverages for immediate consumption, or to authorized fountain wholesalers who in turn sell and distribute the fountain syrups to fountain retailers.
Our finished product operations consist primarily of Company-owned or -controlled bottling, sales and distribution operations, including CCR. OurUntil December 31, 2015, our Company-owned or -controlled bottling, sales and distribution operations, other than CCR, arewere included in our Bottling Investments operating segment.segment; and CCR iswas included in our North America operating segment. Effective January 1, 2016, we transferred CCR's bottling and associated supply chain operations in the United States and Canada from our North America segment to our Bottling Investments segment. Our finished product operations generate net operating revenues by selling sparkling beverages and a variety of still beverages, such as juices and juice drinks, energy and sports drinks, ready-to-drink teas and coffees, and certain water products, to retailers or to distributors, wholesalers and bottling partners who distribute them to retailers. In addition, in the United States, we manufacture fountain syrups and sell them to fountain retailers such as restaurants and convenience stores who use the fountain syrups to produce beverages for immediate consumption or to authorized fountain wholesalers or bottling partners who resell the fountain syrups to fountain retailers. In the United States, we authorize wholesalers to resell our fountain syrups through nonexclusive appointments that neither restrict us in setting the prices at which we sell fountain syrups to the wholesalers nor restrict the territories in which the wholesalers may resell in the United States.

3032



The following table sets forth the percentage of total net operating revenues related to concentrate operations and finished product operations:
Year Ended December 31,2014
2013
2012
2015
2014
2013
Concentrate operations1
38%38%38%37%38%38%
Finished product operations2
62
62
62
63
62
62
Net operating revenues100%100%100%
Total100%100%100%
1 
Includes concentrates sold by the Company to authorized bottling partners for the manufacture of fountain syrups. The bottlers then typically sell the fountain syrups to wholesalers or directly to fountain retailers.
2 
Includes fountain syrups manufactured by the Company, including consolidated bottling operations, and sold to fountain retailers or to authorized fountain wholesalers or bottling partners who resell the fountain syrups to fountain retailers.
The following table sets forth the percentage of total worldwide unit case volume related to concentrate operations and finished product operations:
Year Ended December 31,2014
2013
2012
2015
2014
2013
Concentrate operations1
73%72%70%73%73%72%
Finished product operations2
27
28
30
27
27
28
Total worldwide unit case volume100%100%100%
Total100%100%100%
1 
Includes unit case volume related to concentrates sold by the Company to authorized bottling partners for the manufacture of fountain syrups. The bottlers then typically sell the fountain syrups to wholesalers or directly to fountain retailers.
2 
Includes unit case volume related to fountain syrups manufactured by the Company, including consolidated bottling operations, and sold to fountain retailers or to authorized fountain wholesalers or bottling partners who resell the fountain syrups to fountain retailers.
The Nonalcoholic Beverage Segment of the Commercial Beverage Industry
We operate in the highly competitive nonalcoholic beverage segment of the commercial beverage industry. We face strong competition from numerous other general and specialty beverage companies. We, along with other beverage companies, are affected by a number of factors, including, but not limited to, cost to manufacture and distribute products, consumer spending, economic conditions, availability and quality of water, consumer preferences, inflation, political climate, local and national laws and regulations, foreign currency exchange fluctuations, fuel prices and weather patterns.
Our Objective
Our objective is to use our formidable assets — our brands, financial strength, unrivaled distribution system, global reach, and the talent and strong commitment of our management and associates — to achieve long-term sustainable growth. Our vision for sustainable growth includes the following:
People: Being a great place to work where people are inspired to be the best they can be.
Portfolio: Bringing to the world a portfolio of beverage brands that anticipates and satisfies people's desires and needs.
Partners: Nurturing a winning network of partners and building mutual loyalty.
Planet: Being a responsible global citizen that makes a difference.
Profit: Maximizing return to shareowners while being mindful of our overall responsibilities.
Productivity: Managing our people, time and money for greatest effectiveness.
To enable us to achieve our objective, we must further enhance our core capabilities of consumer marketing; commercial leadership; franchise leadership; and bottling and distribution operations.

3133



Core Capabilities
Consumer Marketing
Marketing investments are designed to enhance consumer awareness of, and increase consumer preference for, our brands. Successful marketing investments produce long-term growth in unit case volume, per capita consumption and our share of worldwide nonalcoholic beverage sales. Through our relationships with our bottling partners and those who sell our products in the marketplace, we create and implement integrated marketing programs, both globally and locally, that are designed to heighten consumer awareness of and product appeal for our brands. In developing a strategy for a Company brand, we conduct product and packaging research, establish brand positioning, develop precise consumer communications and solicit consumer feedback. Our integrated marketing activities include, but are not limited to, advertising, point-of-sale merchandising and sales promotions.
We are focusing on marketing strategies to drive volume growth in emerging markets, increasing our brand value in developing markets and growing profit in our developed markets. In emerging markets, we are investing in infrastructure programs that drive volume through increased access to consumers. In developing markets, where consumer access has largely been established, our focus is on differentiating our brands. In our developed markets, we continue to invest in brands and infrastructure programs but generally at a slower rate than gross profit growth.
Commercial Leadership
The Coca-Cola system has millions of customers around the world who sell or serve our products directly to consumers. We focus on enhancing value for our customers and providing solutions to grow their beverage businesses. Our approach includes understanding each customer's business and needs — whether that customer is a sophisticated retailer in a developed market or a kiosk owner in an emerging market. We focus on ensuring that our customers have the right product and package offerings and the right promotional tools to deliver enhanced value to themselves and the Company. We are constantly looking to build new beverage consumption occasions in our customers' outlets through unique and innovative consumer experiences, product availability and delivery systems, and beverage merchandising and displays. We participate in joint brand-building initiatives with our customers in order to drive customerconsumer preference for our brands. Through our commercial leadership initiatives, we embed ourselves further into our retail customers' businesses while developing strategies for better execution at the point of sale.
Franchise Leadership
We must continue to improve our franchise leadership capabilities to give our Company and our bottling partners the ability to grow together through shared values, aligned incentives and a sense of urgency and flexibility that supports consumers' always changing needs and tastes. The financial health and success of our bottling partners are critical components of the Company's success. We work with our bottling partners to identify processes that enable us to quickly achieve scale and efficiencies, and we share best practices throughout the bottling system. With our bottling partners, we work to produce differentiated beverages and packages that are appropriate for the right channels and consumers. We also design business models for sparkling and still beverages in specific markets to ensure that we appropriately share the value created by these beverages with our bottling partners. We will continue to build a supply chain network that leverages the size and scale of the Coca-Cola system to gain a competitive advantage.
Bottling and Distribution Operations
Most of our Company beverage products are manufactured, sold and distributed by independent bottling partners. However, from time to time we often acquire bottlersor take control of bottling operations, often in underperforming markets where we believe we can use our resources and expertise to improve performance. Owning such a controlling interest enables us to compensate for limited local resources; help focus the bottler's sales and marketing programs; assist in the development of the bottler's business and information systems; and establish an appropriate capital structure for the bottler.
Our Company has a long history of providing world-class customer service, demonstrating leadership in the marketplace and leveraging the talent of our global workforce. In addition, we have an experienced bottler management team. All of these factors are critical to build upon as we manage our growing bottling and distribution operations.
The Company has a deep commitment to continuously improving our business. This includes our efforts to develop innovative packaging and merchandising solutions which help drive demand for our beverages and meet the growing needsevolving preferences of our consumers. As we further transform the way we go to market, the Company continues to seek out ways to be more efficient.

3234



Challenges and Risks
Being global provides unique opportunities for our Company. Challenges and risks accompany those opportunities. Our management has identified certain challenges and risks that demand the attention of the nonalcoholic beverage segment of the commercial beverage industry and our Company. Of these, six key challenges and risks are discussed below.
Obesity Poor Diets and Inactive Lifestyles
The rates of obesity affecting communities, cultures and countries worldwide continue to be too high. There is growing concern among consumers, public health professionals and government agencies about the health problems associated with obesity, which results from poor diets that are too high in calories combined with inactive lifestyles. This concern represents a significant challenge to our industry. We understand and recognize that obesity is a complex public health challenge and are committed to being a part of the solution.
We recognize the uniqueness of consumers’consumers' lifestyles and dietary choices. All of our products can be part of an active, healthy lifestyleWe are working to pair commercial actions with community engagement to bring together business, government and civil society to help pursue solutions that includes a sensible and balanced diet, proper hydration and regular physical activity. However, when it comes to weight management, all calories count, whatever food or beverage they come from, including calories from our beverages.address obesity. Commercially, we continue to:
The following four global initiatives will guide our efforts to address obesity and bring people together to pursue solutions:
Offeroffer reduced-, low- or no-calorie beverage optionsoptions;
Provideprovide transparent nutrition information, featuring calories on the front of all of our packagespackages;
Help get people moving by supporting physical activity programsprovide our beverages in a range of packaging sizes; and
Marketmarket responsibly, including no advertising to children under 1212.
We recognize the healthThe heritage of our businessCompany is interwoven with the well-being of our consumers, our employeesto lead, and the communities we serve, andinnovation is critical for leadership. As such, we are resolute in continuing to innovate and are committed to partnering to find winning solutions in the area of noncaloric sweeteners. This includes working to reduce caloric sweeteners, and therefore the calories, in cooperation with governments, educatorsour beverages. We want to be a more helpful and consumers.credible partner in the fight against obesity. Across the Coca-Cola system, we are mobilizing our assets in marketing and in community outreach to increase awareness and spur action.
Water Quality and Quantity
Water quality and quantity is an issue that increasingly requires our Company’sCompany's attention and collaboration with other companies, suppliers, governments, nongovernmental organizations and communities where we operate. Water is a main ingredient in substantially all of our products, is vital to the production of the agricultural ingredients on which our business relies and is needed in our manufacturing process. It also is critical to the prosperity of the communities we serve. Water is a limited natural resource facing unprecedented challenges from overexploitation, flourishing food demand, increasing pollution, poor management and the effects of climate change.
Our Company has a robust water stewardship and management program and continues to work to improve water use efficiency, treat wastewater prior to discharge and achieve our goal of replenishing the water that we and our bottling partners source and use in our finished products. We regularly assess the specific water-related risks that we and many of our bottling partners face and have implemented a formal water risk management program. We are actively collaborating with other companies, governments, nongovernmental organizations and communities to advocate for needed water policy reforms and action to protect water availability and quality around the world. We are working with our global partners to develop and implement sustainability-related water projects that address local needs. We are encouraging improved water efficiency and conservation efforts throughout our system. Through these integrated programs, we believe that our Company is in an excellent position to leverage the water-related knowledge we have developed in the communities we serve — through source water availability assessments and planning, water resource management, water treatment, wastewater treatment systems and models for working with communities and partners in addressing water and sanitation needs. As demand for water continues to increase around the world, we expect commitment and continued action on our part will be crucial to the successful long-term stewardship of this critical natural resource.
Evolving Consumer Preferences
We are impacted by shifting consumer demographics and needs, on-the-go lifestyles, aging populations and consumers who are empowered with more information than ever. As a consequence of these changes, consumers want more choices. We are committed to meeting their needs and to generating new growth through our portfolio of more than 500 brands and more than 3,6003,800 beverage products, including more than 1,0001,100 low- and no-calorie products, new product offerings, innovative packaging and ingredient education efforts. We are also committed to continuing to expand the variety of choices we provide to consumers to meet their ever-changing needs, desires and lifestyles.

3335



Increased Competition and Capabilities in the Marketplace
Our Company is facing strong competition from some well-established global companies and many local participants. We must continue to strengthen our capabilities in marketing and innovation in order to maintain our brand loyalty and market share while we strategically expand into other profitable segmentscategories of the nonalcoholic beverage segment of the commercial beverage industry.
Product Safety and Quality
As the world's largest beverage company, we strive to meet the highest of standards in both product safety and product quality. We are aware that some consumers have concerns and negative viewpoints regarding certain ingredients used in our products. Our system works every day to share safe and refreshing beverages with the world. We have rigorous product and ingredient safety and quality standards designed to ensure safety and quality in each of our products, and we drive innovation that provides new beverage options to meet consumers' evolving needs and preferences. Across the Coca-Cola system, we take great care in an effort to ensure that every one of our beverages meets the highest standards for safety and quality.
We work to ensure consistent safety and quality through strong governance and compliance with applicable regulations and standards. We stay current with new regulations, industry best practices and marketplace conditions and engage with standard-setting and industry organizations. Additionally, we manufacture and distribute our products according to strict policies, requirements and specifications set forth in an integrated quality management program that continually measures all operations within the Coca-Cola system against the same stringent standards. Our quality management system also identifies and mitigates risks and drives improvement. In our quality laboratories, we stringently measure the quality attributes of ingredients as well as samples of finished products collected from the marketplace.
We perform due diligence to ensure that product and ingredient safety and quality standards are maintained in the more than 200 countries where our products are sold. We consistently reassess the relevance of our requirements and standards and continually work to improve and refine them across our entire supply chain.
Food Security
Increased demand for commodities and decreased agricultural productivity in certain regions of the world as a result of changing weather patterns may limit the availability or increase the cost of key agricultural commodities, such as sugarcane, corn, sugar beets, citrus, coffee and tea, which are important sources of ingredients for our products and could impact the food security of communities around the world. We are dedicated to implementing our sustainable sourcing commitment, which is founded on principles that protect the environment, uphold workplace rights and help build more sustainable communities. To support this commitment, our programs focus on economic opportunity, with an emphasis on female farmers, and environmental sustainability designed to help address these agricultural challenges. Through joint efforts with farmers, communities, bottlers, suppliers and key partners, as well as our increased and continued investment in sustainable agriculture, we can together help make a positive strategic impact on food security.
All of these challenges and risks — obesity, poor diets and inactive lifestyles;obesity; water quality and quantity; evolving consumer preferences; increased competition and capabilities in the marketplace; product safety and quality; and food security — have the potential to have a material adverse effect on the nonalcoholic beverage segment of the commercial beverage industry and on our Company; however, we believe our Company is well positioned to appropriately address these challenges and risks.
See also ''Item 1A. Risk Factors'' in Part I of this report for additional information about risks and uncertainties facing our Company.

34



Critical Accounting Policies and Estimates
Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States, which require management to make estimates, judgments and assumptions that affect the amounts reported in our consolidated financial statements and accompanying notes. We believe our most critical accounting policies and estimates relate to the following:
Principles of Consolidation
Recoverability of Current and Noncurrent Assets
Pension Plan Valuations
Revenue Recognition
Income Taxes

36



Management has discussed the development, selection and disclosure of critical accounting policies and estimates with the Audit Committee of the Company's Board of Directors. While our estimates and assumptions are based on our knowledge of current events and actions we may undertake in the future, actual results may ultimately differ from these estimates and assumptions. For a discussion of the Company's significant accounting policies, refer to Note 1 of Notes to Consolidated Financial Statements.
Principles of Consolidation
Our Company consolidates all entities that we control by ownership of a majority voting interest as well as variable interest entities for which our Company is the primary beneficiary. Generally, we consolidate only business enterprises that we control by ownership of a majority voting interest. However, there are situations in which consolidation is required even though the usual condition of consolidation (ownership of a majority voting interest) does not apply. Generally, this occurs when an entity holds an interest in another business enterprise that was achieved through arrangements that do not involve voting interests, which results in a disproportionate relationship between such entity's voting interests in, and its exposure to the economic risks and potential rewards of, the other business enterprise. This disproportionate relationship results in what is known as a variable interest, and the entity in which we have the variable interest is referred to as a "VIE." An enterprise must consolidate a VIE if it is determined to be the primary beneficiary of the VIE. The primary beneficiary has both (1) the power to direct the activities of the VIE that most significantly impact the entity's economic performance, and (2) the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE.
Our Company holds interests in certain VIEs, primarily bottling and container manufacturing operations, for which we were not determined to be the primary beneficiary. Our variable interests in these VIEs primarily relate to profit guarantees or subordinated financial support. Refer to Note 11 of Notes to Consolidated Financial Statements. Although these financial arrangements resulted in our holding variable interests in these entities, they did not empower us to direct the activities of the VIEs that most significantly impact the VIEs' economic performance. Our Company's investments, plus any loans and guarantees, related to these VIEs totaled $2,2742,687 million and $2,1712,274 million as of December 31, 20142015 and 20132014, respectively, representing our maximum exposures to loss. The Company's investments, plus any loans and guarantees, related to these VIEs were not significant to the Company's consolidated financial statements.
In addition, our Company holds interests in certain VIEs, primarily bottling and container manufacturing operations, for which we were determined to be the primary beneficiary. As a result, we have consolidated these entities. Our Company's investments, plus any loans and guarantees, related to these VIEs totaled $266221 million and $284266 million as of December 31, 20142015 and 20132014, respectively, representing our maximum exposures to loss. The assets and liabilities of VIEs for which we are the primary beneficiary were not significant to the Company's consolidated financial statements.
Creditors of our VIEs do not have recourse against the general credit of the Company, regardless of whether they are accounted for as consolidated entities.

35



Recoverability of Current and Noncurrent Assets
Our Company faces many uncertainties and risks related to various economic, political and regulatory environments in the countries in which we operate, particularly in developing or emerging markets. Refer to the heading "Our Business — Challenges and Risks" above and "Item 1A. Risk Factors" in Part I of this report. As a result, management must make numerous assumptions which involve a significant amount of judgment when completing recoverability and impairment tests of current and noncurrent assets in various regions around the world.
We perform recoverability and impairment tests of current and noncurrent assets in accordance with accounting principles generally accepted in the United States. For certain assets, recoverability and/or impairment tests are required only when conditions exist that indicate the carrying value may not be recoverable. For other assets, impairment tests are required at least annually, or more frequently, if events or circumstances indicate that an asset may be impaired.
Our equity method investees also perform such recoverability and/or impairment tests. If an impairment charge is recorded by one of our equity method investees, the Company records its proportionate share of such charge as a reduction of equity income (loss) — net in our consolidated statements of income. However, the actual amount we record with respect to our proportionate share of such charges may be impacted by items such as basis differences, deferred taxes and deferred gains.

37



Management's assessments of the recoverability and impairment tests of noncurrent assets involve critical accounting estimates. These estimates require significant management judgment, include inherent uncertainties and are often interdependent; therefore, they do not change in isolation. Factors that management must estimate include, among others, the economic life of the asset, sales volume, pricing, cost of raw materials, delivery costs, inflation, cost of capital, marketing spending, foreign currency exchange rates, tax rates, capital spending and proceeds from the sale of assets. These factors are even more difficult to predict when global financial markets are highly volatile. The estimates we use when assessing the recoverability of current and noncurrent assets are consistent with those we use in our internal planning. When performing impairment tests, we estimate the fair values of the assets using management's best assumptions, which we believe would be consistent with what a hypothetical marketplace participant would use. Estimates and assumptions used in these tests are evaluated and updated as appropriate. The variability of these factors depends on a number of conditions, including uncertainty about future events, and thus our accounting estimates may change from period to period. If other assumptions and estimates had been used when these tests were performed, impairment charges could have resulted. As mentioned above, these factors do not change in isolation and, therefore, we do not believe it is practicable or meaningful to present the impact of changing a single factor. Furthermore, if management uses different assumptions or if different conditions occur in future periods, future impairment charges could result. Refer to the heading "Operations Review" below for additional information related to our present business environment. Certain factors discussed above are impacted by our current business environment and are discussed throughout this report, as appropriate.
Our Company faces many uncertainties and risks related to various economic, political and regulatory environments in the countries in which we operate, particularly in developing or emerging markets. Refer to the heading "Our Business — Challenges and Risks" above and "Item 1A. Risk Factors" in Part I of this report. As a result, management must make numerous assumptions which involve a significant amount of judgment when completing recoverability and impairment tests of noncurrent assets in various regions around the world.
Investments in Equity and Debt Securities
The carrying values of our investments in equity securities are determined using the equity method, the cost method or the fair value method. We account for investments in companies that we do not control or account for under the equity method either at fair value or under the cost method, as applicable. Investments in equity securities, other than investments accounted for under the equity method, are carried at fair value if the fair value of the security is readily determinable. Equity investments carried at fair value are classified as either trading or available-for-sale securities. Realized and unrealized gains and losses on trading securities and realized gains and losses on available-for-sale securities are included in net income. Unrealized gains and losses, net of deferred taxes, on available-for-sale securities are included in our consolidated balance sheets as a component of accumulated other comprehensive income (loss) ("AOCI"), except for the change in fair value attributable to the currency risk being hedged, if applicable, which is included in net income. Trading securities are reported as either marketable securities or other assets in our consolidated balance sheets. Securities classified as available-for-sale are reported as either marketable securities or other investments in our consolidated balance sheets, depending on the length of time we intend to hold the investment. Investments in equity securities that do not qualify for fair value accounting or equity method accounting are accounted for under the cost method. In accordance with the cost method, our initial investment is recorded at cost and we record dividend income when applicable dividends are declared. Cost method investments are reported as other investments in our consolidated balance sheets.
Our investments in debt securities are carried at either amortized cost or fair value. Investments in debt securities that the Company has the positive intent and ability to hold to maturity are carried at amortized cost and classified as held-to-maturity. Investments in debt securities that are not classified as held-to-maturity are carried at fair value and classified as either trading or available-for-sale.

36



The following table presents the carrying values of our investments in equity and debt securities (in millions):
December 31, 2014
Carrying
Value

 
Percentage
of Total
Assets

December 31, 2015
Carrying
Value

 
Percentage
of Total
Assets

Equity method investments$9,947
 11%$12,318
 14%
Securities classified as available-for-sale7,879
 9
8,606
 10
Securities classified as trading409
 *
322
 *
Cost method investments166
 *
190
 *
Total$18,401
 20%$21,436
 24%
* 
Accounts for less than 1 percent of the Company's total assets.

38



Investments classified as trading securities are not assessed for impairment, since they are carried at fair value with the change in fair value included in net income. We review our investments in equity and debt securities that are accounted for using the equity method or cost method or that are classified as available-for-sale or held-to-maturity each reporting period to determine whether a significant event or change in circumstances has occurred that may have an adverse effect on the fair value of each investment. When such events or changes occur, we evaluate the fair value compared to our cost basis in the investment. We also perform this evaluation every reporting period for each investment for which our cost basis has exceeded the fair value in the prior period.value. The fair values of most of our Company's investments in publicly traded companies are often readily available based on quoted market prices. For investments in nonpublicly traded companies, management's assessment of fair value is based on valuation methodologies including discounted cash flows, estimates of sales proceeds and appraisals, as appropriate. We consider the assumptions that we believe hypothetical marketplace participants would use in evaluating estimated future cash flows when employing the discounted cash flow or estimates of sales proceeds valuation methodologies. The ability to accurately predict future cash flows, especially in emerging and developing markets, may impact the determination of fair value.
In the event the fair value of an investment declines below our cost basis, management is required to determine if the decline in fair value is other than temporary. If management determines the decline is other than temporary, an impairment charge is recorded. Management's assessment as to the nature of a decline in fair value is based on, among other things, the length of time and the extent to which the market value has been less than our cost basis, the financial condition and near-term prospects of the issuer, and our intent and ability to retain the investment for a period of time sufficient to allow for any anticipated recovery in market value.
In 2013, four of the Company's Japanese bottling partners merged as Coca-Cola East Japan Bottling Company, Ltd., now known as Coca-Cola East Japan Co., Ltd. ("CCEJ"), a publicly traded entity, through a share exchange. The terms of the agreement included the issuance of new shares of one of the publicly traded bottlers in exchange for 100 percent of the outstanding shares of the remaining three bottlers according to an agreed-upon share exchange ratio. As a result, the Company recorded a net charge of $114 million for those investments in which the Company's carrying value was greater than the fair value of the shares received. These charges were recorded in the line item other income (loss) — net in our consolidated statement of income and impacted the Corporate operating segment. Refer to the heading "Operations Review — Other Income (Loss) — Net" below as well as Note 16 and Note 17 of Notes to Consolidated Financial Statements.
In 2012, the Company recognized impairment charges of $16 million as a result of the other-than-temporary decline in the fair values of certain cost method investments. These impairment charges were recorded in the line item other income (loss) — net in our consolidated statement of income and impacted the Corporate operating segment. Refer to the heading "Operations Review — Other Income (Loss) — Net" below as well as Note 17 of Notes to Consolidated Financial Statements.

37



The following table presents the difference between calculated fair values, based on quoted closing prices of publicly traded shares, and our Company's cost basis in investments in publicly traded bottlerscompanies accounted for asunder the equity method investments (in millions):
December 31, 2014
Fair
Value

 
Carrying
Value

 Difference
December 31, 2015
Fair
Value

 
Carrying
Value

 Difference
Monster Beverage Corporation$5,071
 $3,118
 $1,953
Coca-Cola FEMSA, S.A.B. de C.V.$5,012
 $2,150
 $2,862
4,360
 1,853
 2,507
Coca-Cola HBC AG1,851
 1,105
 746
Coca-Cola Amatil Limited1,699
 761
 938
1,496
 685
 811
Coca-Cola HBC AG1,639
 1,367
 272
Coca-Cola İçecek A.Ş.1,159
 253
 906
653
 202
 451
Coca-Cola East Japan Bottling Company, Ltd.618
 447
 171
Coca-Cola East Japan Co., Ltd.627
 448
 179
Coca-Cola Bottling Co. Consolidated453
 104
 349
Embotelladora Andina S.A.373
 311
 62
396
 275
 121
Corporación Lindley S.A.221
 108
 113
191
 83
 108
Coca-Cola Bottling Co. Consolidated219
 100
 119
Total$10,940
 $5,497
 $5,443
$15,098
 $7,873
 $7,225

39



Other Assets
Our Company invests in infrastructure programs with our bottlers that are directed at strengthening our bottling system and increasing unit case volume. Additionally, our Company advances payments to certain customers for distribution rights as well as to fund future marketing activities intended to generate profitable volume and expenses such payments over the periods benefited. Payments under these programs are generally capitalized and reported in the line items prepaid expenses and other assets or other assets, as appropriate, in our consolidated balance sheets. When facts and circumstances indicate that the carrying value of these assets (or asset groups) may not be recoverable, management assesses the recoverability of the carrying value by preparing estimates of sales volume and the resulting gross profit and cash flows. These estimated future cash flows are consistent with those we use in our internal planning. If the sum of the expected future cash flows (undiscounted and without interest charges) is less than the carrying amount, we recognize an impairment loss. The impairment loss recognized is the amount by which the carrying amount exceeds the fair value.
Property, Plant and Equipment
As of December 31, 20142015, the carrying value of our property, plant and equipment, net of depreciation, was $14,63312,571 million, or 1614 percent of our total assets. Certain events or changes in circumstances may indicate that the recoverability of the carrying amount or remaining useful life of property, plant and equipment should be assessed, including, among others, the manner or length of time in which the Company intends to use the asset, a significant decrease in market value, a significant change in the business climate in a particular market, or a current period operating or cash flow loss combined with historical losses or projected future losses. When such events or changes in circumstances are present and an impairment review is performed, we estimate the future cash flows expected to result from the use of the asset (or asset group) and its eventual disposition. These estimated future cash flows are consistent with those we use in our internal planning. If the sum of the expected future cash flows (undiscounted and without interest charges) is less than the carrying amount, we recognize an impairment loss. The impairment loss recognized is the amount by which the carrying amount exceeds the fair value. We use a variety of methodologies to determine the fair value of property, plant and equipment, including appraisals and discounted cash flow models, which are consistent with the assumptions we believe hypothetical marketplace participants would use.
Goodwill, Trademarks and Other Intangible Assets
Intangible assets are classified into one of three categories: (1) intangible assets with definite lives subject to amortization, (2) intangible assets with indefinite lives not subject to amortization and (3) goodwill. For intangible assets with definite lives, tests for impairment must be performed if conditions exist that indicate the carrying value may not be recoverable. For intangible assets with indefinite lives and goodwill, tests for impairment must be performed at least annually or more frequently if events or circumstances indicate that assets might be impaired.


38



The following table presents the carrying values of intangible assets included in our consolidated balance sheet (in millions):
December 31, 2014
Carrying
Value

 
Percentage
of Total
Assets 1

December 31, 2015
Carrying
Value

 
Percentage
of Total
Assets1

Goodwill$12,100
 13%$11,289
 13%
Bottlers' franchise rights with indefinite lives6,689
 7
6,000
 7
Trademarks with indefinite lives6,533
 7
5,989
 7
Definite-lived intangible assets, net880
 1
690
 1
Other intangible assets not subject to amortization170
 *
164
 *
Total$26,372
 29%$24,132
 27%
* 
Accounts for less than 1 percent of the Company's total assets.
1 The total percentage does not add due to rounding.
1
The total percentage does not add due to rounding.
When facts and circumstances indicate that the carrying value of definite-lived intangible assets may not be recoverable, management assesses the recoverability of the carrying value by preparing estimates of sales volume and the resulting gross profit and cash flows. These estimated future cash flows are consistent with those we use in our internal planning. If the sum of the expected future cash flows (undiscounted and without interest charges) is less than the carrying amount of the asset (or asset group), we recognize an impairment loss. The impairment loss recognized is the amount by which the carrying amount exceeds the fair value. We use a variety of methodologies to determine the fair value of these assets, including discounted cash flow models, which are consistent with the assumptions we believe hypothetical marketplace participants would use.

40



We test intangible assets determined to have indefinite useful lives, including trademarks, franchise rights and goodwill, for impairment annually, or more frequently if events or circumstances indicate that assets might be impaired. Our Company performs these annual impairment reviews as of the first day of our third fiscal quarter. We use a variety of methodologies in conducting impairment assessments of indefinite-lived intangible assets, including, but not limited to, discounted cash flow models, which are based on the assumptions we believe hypothetical marketplace participants would use. For indefinite-lived intangible assets, other than goodwill, if the carrying amount exceeds the fair value, an impairment charge is recognized in an amount equal to that excess.
The Company has the option to perform a qualitative assessment of indefinite-lived intangible assets, other than goodwill, prior to completing the impairment test described above. The Company must assess whether it is more likely than not that the fair value of the intangible asset is less than its carrying amount. If the Company concludes that this is the case, it must perform the testing described above. Otherwise, the Company does not need to perform any further assessment. During 20142015, the Company performed qualitative assessments on less than 1025 percent of the carrying value of our indefinite-lived intangible assets balance.other than goodwill.
We perform impairment tests of goodwill at our reporting unit level, which is one level below our operating segments. Our operating segments are primarily based on geographic responsibility, which is consistent with the way management runs our business. Our operating segments are subdivided into smaller geographic regions or territories that we sometimes refer to as "business units." These business units are also our reporting units. The Bottling Investments operating segment includes all Company-owned or consolidated bottling operations, regardless of geographic location, except for bottling operations managed by CCR, which are included in our North America operating segment. Generally, each Company-owned or consolidated bottling operation within our Bottling Investments operating segment is its own reporting unit. Goodwill is assigned to the reporting unit or units that benefit from the synergies arising from each business combination.
The goodwill impairment test consists of a two-step process, if necessary. The first step is to compare the fair value of a reporting unit to its carrying value, including goodwill. We typically use discounted cash flow models to determine the fair value of a reporting unit. The assumptions used in these models are consistent with those we believe hypothetical marketplace participants would use. If the fair value of the reporting unit is less than its carrying value, the second step of the impairment test must be performed in order to determine the amount of impairment loss, if any. The second step compares the implied fair value of the reporting unit's goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit's goodwill exceeds its implied fair value, an impairment charge is recognized in an amount equal to that excess. The loss recognized cannot exceed the carrying amount of goodwill.
The Company has the option to perform a qualitative assessment of goodwill prior to completing the two-step process described above to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill and other intangible assets. If the Company concludes that this is the case, it must perform the two-

39



steptwo-step process. Otherwise, the Company will forego the two-step process and does not need to perform any further testing. During 20142015, the Company performed qualitative assessments on less than 10 percent of our consolidated goodwill balance. As of December 31, 2015, we did not have any reporting unit with a material amount of goodwill for which it is reasonably likely that it will fail step one of a goodwill impairment test in the near term.
Intangible assets acquired in recent transactions are naturally more susceptible to impairment, primarily due to the fact that they are recorded at fair value based on recent operating plans and macroeconomic conditions present at the time of acquisition. Consequently, if operating results and/or macroeconomic conditions deteriorate shortly after an acquisition, it could result in the impairment of the acquired assets. A deterioration of macroeconomic conditions may not only negatively impact the estimated operating cash flows used in our cash flow models but may also negatively impact other assumptions used in our analyses, including, but not limited to, the estimated cost of capital and/or discount rates. Additionally, as discussed above, in accordance with accounting principles generally accepted in the United States, we are required to ensure that assumptions used to determine fair value in our analyses are consistent with the assumptions a hypothetical marketplace participant would use. As a result, the cost of capital and/or discount rates used in our analyses may increase or decrease based on market conditions and trends, regardless of whether our Company's actual cost of capital has changed. Therefore, if the cost of capital and/or discount rates change, our Company may recognize an impairment of an intangible asset in spite of realizing actual cash flows that are approximately equal to, or greater than, our previously forecasted amounts.
On June 12, 2015, the Company closed a transaction with Monster. Under the terms of the transaction, the Company was required to discontinue selling energy products under one of the trademarks included in the glacéau portfolio. During the year ended December 31, 2015, the Company recognized impairment charges of $418 million, primarily as a result of discontinuing these products. The total combined fair value of the various trademarks in the glacéau portfolio significantly exceeds the remaining combined carrying value of $2.9 billion as of December 31, 2015. However, the fair value of the individual trademark that was the subject of the impairment charges currently equals its carrying value. If the future operating results of

41



this trademark do not support the current near-term financial projections, or if macroeconomic conditions change causing the cost of capital and/or discount rate to increase without an offsetting increase in the operating results, it is likely that we would be required to recognize an additional impairment charge related to this trademark.
During 2015, the Company also recorded a charge of $55 million related to the impairment of a Venezuelan trademark. The Venezuelan trademark impairment was due to the Company's revised expectations regarding the convertibility of the local currency.
These charges were recorded in our Corporate operating segment in the line item other operating charges in our consolidated statement of income and were determined by comparing the fair value of the trademarks, derived using discounted cash flow analyses, to the respective carrying value. Management will continue to monitor the fair value of our intangible assets in future periods.
The Company did not record any significant impairment charges related to intangible assets during the year ended December 31, 2014.
2014. During 2013, the Company recorded charges of $195 million related to certain intangible assets. These charges included $113 million related to the impairment of trademarks recorded in our Bottling Investments and Asia Pacific operating segments. These impairments were primarily due to a strategic decision to phase out certain local-market brands, which resulted in a change in the expected useful life of the intangible assets, and were determined by comparing the fair value of the trademarks, derived using discounted cash flow analyses, to the current carrying value. Additionally, the remaining charge of $82 million related to goodwill recorded in our Bottling Investments operating segment. This charge was primarily the result of management's revised outlook on market conditions and volume performance. The total impairment charges of $195 million were recorded in our Corporate operating segment in the line item other operating charges in our consolidated statements of income.
As of December 31, 2014, we did not have any reporting unit with a material amount of goodwill for which it is reasonably likely that it will fail step one of a goodwill impairment test in the near term. However, if macroeconomic conditions worsen or our current financial projections are not achieved, it is possible that we may experience significant impairments of some of our intangible assets, which would require us to recognize impairment charges. On June 7, 2007, our Company acquired Energy Brands Inc., also known as glacéau, for approximately $4.1 billion. The Company allocated $3.3 billion of the purchase price to various trademarks acquired in this business combination. While the combined fair value of the various trademarks acquired in this transaction significantly exceeds their combined carrying values as of December 31, 2014, the fair value of one trademark within the portfolio has declined and now approximates its carrying value. The operating results of this trademark for the year ended December 31, 2014, were lower than our business plan projections for the year. If the future operating results of this trademark do not support the current near-term financial projections, or if macroeconomic conditions change causing the cost of capital and/or discount rate to increase without an offsetting increase in the operating results, it is likely that we would be required to recognize an impairment charge related to this trademark. Management will continue to monitor the fair value of our intangible assets in future periods.
Pension Plan Valuations
Our Company sponsors and/or contributes to pension and postretirement health care and life insurance benefit plans covering substantially all U.S. employees. We also sponsor nonqualified, unfunded defined benefit pension plans for certain associates and participate in multi-employer pension plans in the United States. In addition, our Company and its subsidiaries have various pension plans and other forms of postretirement arrangements outside the United States.
Management is required to make certain critical estimates related to actuarial assumptions used to determine our pension expense and related obligation.obligations. We believe the most critical assumptions are related to (1) the discount rate used to determine the present value of the liabilities and (2) the expected long-term rate of return on plan assets. All of our actuarial assumptions are reviewed annually. Changes in these assumptions could have a material impact on the measurement of our pension expense and related obligation.obligations.
At each measurement date, we determine the discount rate primarily by reference to rates of high-quality, long-term corporate bonds that mature in a pattern similar to the future payments we anticipate making under the plans. As of December 31, 20142015 and 2013,2014, the weighted-average discount rate used to compute our benefit obligationpension obligations was 4.25 percent and 3.75 percent, respectively.
During the years ended December 31, 2015, 2014, and 4.75 percent, respectively.2013, for plans using the yield curve approach, the Company measured the related service and interest components of net periodic benefit cost for pension and other postretirement benefit plans utilizing the single weighted-average discount rate derived from the yield curve. Effective January 1, 2016, the Company changed the method used to calculate the service and interest components and will measure these costs by applying the specific spot rates along the yield curve to the plans' projected cash flows. The Company believes the new approach provides a more precise measurement of service and interest costs by improving the correlation between projected cash flows and the corresponding spot yield curve rates. The change does not affect the measurement of the Company's pension and other postretirement benefit obligations for those plans and is accounted for as a change in accounting estimate, which is applied prospectively. In 2016, we expect the change in estimate to reduce pension and other postretirement net periodic benefit plan costs by $73 million.
The expected long-term rate of return on plan assets is based upon the long-term outlook of our investment strategy as well as our historical returns and volatilities for each asset class. We also review current levels of interest rates and inflation to assess the reasonableness of our long-term rates. Our pension plan investment objective is to ensure all of our plans have sufficient

40



funds to meet their benefit obligations when they become due. As a result, the Company periodically revises asset allocations, where appropriate, to improve returns and manage risk. The weighted-average expected long-term rate of return used to calculate our pension expense was 8.25 percent in 20142015 and 2013.2014.

42



In 2015, the Company's total pension expense related to defined benefit plans was $305 million. In 2016, we expect our total pension expense to be $105 million. The anticipated decrease is primarily due to settlement and special termination costs incurred in 2015 of $169 million, the new method to calculate service and interest costs described above, an increase in the weighted-average discount rate used to calculate the Company's benefit obligations and the impact of $471 million of contributions the Company made in early 2016 to U.S. pension plans. The impact of these items will be partially offset by unfavorable asset performance compared to our expected return during 2015 and a decrease in the expected return on assets for U.S. plans. The estimated impact of a 50 basis-point decrease in the discount rate on our 2016 pension expense would be an increase to our pension expense of $34 million. Additionally, the estimated impact of a 50 basis-point decrease in the expected long-term rate of return on plan assets on our 2016 pension expense would be an increase to our pension expense of $29 million.
The sensitivity information provided above is based only on changes to the actuarial assumptions used for our U.S. pension plans. As of December 31, 2015, the Company's primary U.S. plan represented 59 percent and 62 percent of the Company's consolidated projected pension benefit obligation and pension assets, respectively. Refer to Note 13 of Notes to Consolidated Financial Statements for additional information about our pension plans and related actuarial assumptions.
Effective December 31, 2014, the Company revised our mortality assumptions used to determine the projected benefit obligation of the U.S. defined benefit pension plans. The revised assumptions were derived from the mortality tables and the mortality improvement scales published by the Society of Actuaries in October 2014. The change in mortality assumptions for the U.S. plans resulted in an increase in the projected benefit obligation at December 31, 2014 of approximately $210 million.
In 2014, the Company's total pension expense related to defined benefit plans was $34 million. In 2015, we expect our total pension expense to be approximately $134 million. The anticipated increase is primarily due to a decrease in the weighted-average discount rate used to calculate the Company's benefit obligation, unfavorable asset performance compared to our expected return during 2014 and the adoption of more conservative mortality assumptions for U.S. plans offset by the impact of approximately $90 million of contributions the Company expects to make in 2015 to its international plans. The estimated impact of a 50 basis-point decrease in the discount rate on our 2015 pension expense is an increase to our pension expense of approximately $47 million. Additionally, the estimated impact of a 50 basis-point decrease in the expected long-term rate of return on plan assets on our 2015 pension expense is an increase to our pension expense of approximately $31 million.
The sensitivity information provided above is based only on changes to the actuarial assumptions used for our U.S. pension plans. As of December 31, 2014, the Company's primary U.S. plan represented 58 percent and 61 percent of the Company's consolidated projected pension benefit obligation and pension assets, respectively. Refer to Note 13 of Notes to Consolidated Financial Statements for additional information about our pension plans and related actuarial assumptions.
Revenue Recognition
We recognize revenue when persuasive evidence of an arrangement exists, delivery of products has occurred, the sales price is fixed or determinable and collectibility is reasonably assured. For our Company, this generally means that we recognize revenue when title to our products is transferred to our bottling partners, resellers or other customers. Title usually transfers upon shipment to or receipt at our customers' locations, as determined by the specific sales terms of each transaction. Our sales terms do not allow for a right of return except for matters related to any manufacturing defects on our part.
Our customers can earn certain incentives which are included in deductions from revenue, a component of net operating revenues in our consolidated statements of income. These incentives include, but are not limited to, cash discounts, funds for promotional and marketing activities, volume-based incentive programs and support for infrastructure programs. Refer to Note 1 of Notes to Consolidated Financial Statements. The aggregate deductions from revenue recorded by the Company in relation to these programs, including amortization expense on infrastructure programs, were $7.06.8 billion, $6.97.0 billion and $6.16.9 billion in 20142015, 20132014 and 20122013, respectively. In preparing the financial statements, management must make estimates related to the contractual terms, customer performance and sales volume to determine the total amounts recorded as deductions from revenue. Management also considers past results in making such estimates. The actual amounts ultimately paid may be different from our estimates. Such differences are recorded once they have been determined and have historically not been significant.
Income Taxes
Our annual tax rate is based on our income, statutory tax rates and tax planning opportunities available to us in the various jurisdictions in which we operate. Significant judgment is required in determining our annual tax expense and in evaluating our tax positions. We establish reserves to remove some or all of the tax benefit of any of our tax positions at the time we determine that the positions become uncertain based upon one of the following: (1) the tax position is not "more likely than not" to be sustained, (2) the tax position is "more likely than not" to be sustained, but for a lesser amount, or (3) the tax position is "more likely than not" to be sustained, but not in the financial period in which the tax position was originally taken. For purposes of evaluating whether or not a tax position is uncertain, (1) we presume the tax position will be examined by the relevant taxing authority that has full knowledge of all relevant information, (2) the technical merits of a tax position are derived from authorities such as legislation and statutes, legislative intent, regulations, rulings and case law and their applicability to the facts and circumstances of the tax position, and (3) each tax position is evaluated without considerations of the possibility of offset or aggregation with other tax positions taken. We adjust these reserves, including any impact on the related interest and penalties, in light of changing facts and circumstances, such as the progress of a tax audit. Refer to the heading "Operations Review — Income Taxes" below and Note 14 of Notes to Consolidated Financial Statements.
On September 17, 2015, the Company received a Notice from the IRS for the tax years 2007 through 2009, after a five-year audit. In the Notice, the IRS claims that the Company's United States taxable income should be increased by an amount that creates a potential additional federal income tax liability of approximately $3.3 billion for the period, plus interest. No penalties were asserted in the Notice; however, the IRS has since taken the position that it is not precluded from asserting penalties and notified the Company that it may do so. The disputed amounts largely relate to a transfer pricing matter involving the

4143



appropriate amount of taxable income the Company should report in the United States in connection with its licensing of intangible property to certain related foreign licensees regarding the manufacturing, distribution, sale, marketing and promotion of products in overseas markets. The IRS designated the matter for litigation on October 15, 2015. The Company firmly believes that the IRS' claims are without merit and plans to pursue all available administrative and judicial remedies necessary to resolve this matter. To that end, the Company filed a petition in U.S. Tax Court on December 14, 2015. The Company believes that the final adjudication of this matter will not have a material impact on its consolidated financial position, results of operations or cash flows and that it has adequate tax reserves for all tax matters. However, if this dispute were to be ultimately determined adversely to us, the additional tax, interest and any potential penalties could have a material adverse impact on the Company's financial position, results of operations or cash flows. Refer to Note 11 of Notes to Consolidated Financial Statements for additional information.
A number of years may elapse before a particular matter for which we have established a reserve is audited and finally resolved. The number of years with open tax audits varies depending on the tax jurisdiction. The tax benefit that has been previously reserved because of a failure to meet the "more likely than not" recognition threshold would be recognized in our income tax expense in the first interim period when the uncertainty disappears under any one of the following conditions: (1) the tax position is "more likely than not" to be sustained, (2) the tax position, amount, and/or timing is ultimately settled through negotiation or litigation, or (3) the statute of limitations for the tax position has expired. Settlement of any particular issue would usually require the use of cash.
Tax law requires items to be included in the tax return at different times than when these items are reflected in the consolidated financial statements. As a result, the annual tax rate reflected in our consolidated financial statements is different from that reported in our tax return (our cash tax rate). Some of these differences are permanent, such as expenses that are not deductible in our tax return, and some differences reverse over time, such as depreciation expense. These timing differences create deferred tax assets and liabilities. Deferred tax assets and liabilities are determined based on temporary differences between the financial reporting and tax bases of assets and liabilities. The tax rates used to determine deferred tax assets or liabilities are the enacted tax rates in effect for the year and manner in which the differences are expected to reverse. Based on the evaluation of all available information, the Company recognizes future tax benefits, such as net operating loss carryforwards, to the extent that realizing these benefits is considered more likely than not.
We evaluate our ability to realize the tax benefits associated with deferred tax assets by analyzing our forecasted taxable income using both historical and projected future operating results; the reversal of existing taxable temporary differences; taxable income in prior carryback years (if permitted); and the availability of tax planning strategies. A valuation allowance is required to be established unless management determines that it is more likely than not that the Company will ultimately realize the tax benefit associated with a deferred tax asset. As of December 31, 20142015, the Company's valuation allowances on deferred tax assets were $649477 million and primarily related to uncertainties regarding the future realization of recorded tax benefits on tax loss carryforwards generated in various jurisdictions. Current evidence does not suggest we will realize sufficient taxable income of the appropriate character within the carryforward period to allow us to realize these deferred tax benefits. If we were to identify and implement tax planning strategies to recover these deferred tax assets or generate sufficient income of the appropriate character in these jurisdictions in the future, it could lead to the reversal of these valuation allowances and a reduction of income tax expense. The Company believes it will generate sufficient future taxable income to realize the tax benefits related to the remaining net deferred tax assets in our consolidated balance sheets.
The Company does not record a U.S. deferred tax liability for the excess of the book basis over the tax basis of its investments in foreign corporations to the extent that the basis difference results from earnings that meet the indefinite reversal criteria. These criteria are met if the foreign subsidiary has invested, or will invest, the undistributed earnings indefinitely. The decision as to the amount of undistributed earnings that the Company intends to maintain in non-U.S. subsidiaries takes into account items including, but not limited to, forecasts and budgets of financial needs of cash for working capital, liquidity plans, capital improvement programs, merger and acquisition plans, and planned loans to other non-U.S. subsidiaries. The Company also evaluates its expected cash requirements in the United States. Other factors that can influence that determination are local restrictions on remittances (for example, in some countries a central bank application and approval are required in order for the Company's local country subsidiary to pay a dividend), economic stability and asset risk. As of December 31, 2014,2015, undistributed earnings of the Company's foreign subsidiaries that met the indefinite reversal criteria amounted to $33.3$31.9 billion. Refer to Note 14 of Notes to Consolidated Financial Statements.
The Company's effective tax rate is expected to be approximately 22.5 percent in 2015.2016. This estimated tax rate does not reflect the impact of any unusual or special items that may affect our tax rate in 2015.2016.

44



Operations Review
Our organizational structure as of December 31, 20142015, consisted of the following operating segments, the first six of which are sometimes referred to as "operating groups" or "groups": Eurasia and Africa; Europe; Latin America; North America; Asia Pacific; Bottling Investments; and Corporate. For further information regarding our operating segments, refer to Note 19 of Notes to Consolidated Financial Statements.
Structural Changes, Acquired Brands and Newly Licensed Brands
In order to continually improve upon the Company's operating performance, from time to time, we engage in buying and selling ownership interests in bottling partners and other manufacturing operations. In addition, we also acquire brands or enter into license agreements for certain brands to supplement our beverage offerings. These items impact our operating results and certain key metrics used by management in assessing the Company's performance.

42



Unit case volume growth is a metric used by management to evaluate the Company's performance because it measures demand for our products at the consumer level. The Company's unit case volume represents the number of unit cases (or unit case equivalents) of Company beverage products directly or indirectly sold by the Company and its bottling partners to customers and, therefore, reflects unit case volume for consolidated and unconsolidated bottlers. Refer to the heading "Beverage Volume" below.
Concentrate sales volume represents the amount of concentrates and syrups (in all cases expressed in equivalent unit cases) sold by, or used in finished products sold by, the Company to its bottling partners or other customers. Refer to the heading "Beverage Volume" below.
Our Bottling Investments operating segment and our other finished product operations, including the finished product operations in our North America operating segment, typically generate net operating revenues by selling sparkling beverages and a variety of still beverages, such as juices and juice drinks, energy and sports drinks, ready-to-drink teas and coffees, and certain water products, to retailers or to distributors, wholesalers and bottling partners who distribute them to retailers. In addition, in the United States, we manufacture fountain syrups and sell them to fountain retailers such as restaurants and convenience stores who use the fountain syrups to produce beverages for immediate consumption, or to authorized fountain wholesalers or bottling partners who resell the fountain syrups to fountain retailers. For these consolidated finished product operations, we recognize the associated concentrate sales volume at the time the unit case or unit case equivalent is sold to the customer. Our concentrate operations typically generate net operating revenues by selling concentrates and syrups to authorized bottling and canning operations. For these concentrate operations, we recognize concentrate revenue and concentrate sales volume when we sell concentrate to the authorized unconsolidated bottling and canning operations, and we typically report unit case volume when finished products manufactured from the concentrates and syrups are sold to the customer. When we analyze our net operating revenues we generally consider the following four factors: (1) volume growth (unit case volume or concentrate sales volume, as appropriate), (2) acquisitions and divestitures (including structural changes defined below), as applicable, (3) changes in price, product and geographic mix and (4) foreign currency fluctuations. Refer to the heading "Net Operating Revenues" below.
"Structural changes"We generally refersrefer to acquisitions or dispositionsacquisition and divestitures of bottling, distribution or canning operations and consolidation or deconsolidation of bottling and distribution or canning entities for accounting purposes.purposes as structural changes ("structural changes"). Typically, structural changes do not impact the Company's unit case volume on a consolidated basis or at the geographic operating segment level. We recognize unit case volume for all sales of Company beverage products regardless of our ownership interest in the bottling partner, if any. However, the unit case volume reported by our Bottling Investments operating segment is generally impacted by structural changes because it only includes the unit case volume of our consolidated bottling operations.
"Acquired brands" refers to brands acquired during the past 12 months. Typically, the Company has not reported unit case volume or recognized concentrate sales volume related to acquired brands in periods prior to the closing of a transaction. Therefore, the unit case volume and concentrate sales volume from the sale of these brands is incremental to prior year volume. We do not generally consider acquired brands to be structural changes.
"Licensed brands" refers to brands not owned by the Company, but for which we hold certain rights, generally including, but not limited to, distribution rights, and from which we derive an economic benefit when these brands are ultimately sold. Typically, the Company has not reported unit case volume or recognized concentrate sales volume related to these brands in periods prior to the beginning of the term of a license agreement. Therefore, in the year that the licenses are entered into, the unit case volume and concentrate sales volume from the sale of these brands is incremental to prior year volume. We do not generally consider newly licensed brands to be structural changes.

45



In 2015, the Company closed a transaction with Monster ("Monster Transaction"), which has been included as a structural change (a component of acquisitions and divestitures) in our analysis of net operating revenues on a consolidated basis as well as for the Eurasia and Africa, Europe, Latin America, North America, Asia Pacific and Corporate operating segments. This transaction consisted of multiple elements including, but not limited to, the acquisition of Monster's non-energy brands and the expansion of our distribution of Monster products into additional U.S. territories. These elements of the transaction impacted the Company's unit case volume and concentrate sales volume and therefore, in addition to being included as a structural change (a component of acquisitions and divestitures), they are also considered acquired brands. See further discussion of this transaction in Note 2 of Notes to Consolidated Financial Statements. Also during 2015, the Company acquired a South African bottler, which has been included as a structural change (a component of acquisitions and divestitures) in our analysis of net operating revenues on a consolidated basis as well as for the Bottling Investments operating segment. Refer to "Net Operating Revenues" below.
In 2014, the Company began implementing a new beverage partnership modelrefranchising territories in North America. During the year ended December 31, 2014, we refranchised territoriesAmerica that were previously managed by CCR to certain of our unconsolidated bottling partners. The impact of thisthese refranchising activities has been included as a structural change (a component of acquisitions and divestitures) in our analysis of net operating resultsrevenues on a consolidated basis as well as for the year ended December 31, 2014.our North America operating segment. In addition, for non-Company-owned and licensed beverage products sold in the refranchised territories, we have eliminated the unit case volume and associated concentrate sales from the base year when calculating 2014 versus 2013 volume growth rates on a consolidated basis as well as for the North America operating segment. DuringRefer to the year ended December 31,headings "Beverage Volume" and "Net Operating Revenues" below.
In 2014,, the Company made a decision to change our process of buying and selling recyclable materials in North America. The impact of these changes has also been included as a structural change in our analysis of operating results. Refer to the headings "Beverage Volume" and "Net Operating Revenues" below. Refer to Note 2 of Notes to Consolidated Financial Statements.
During the year ended December 31,Also during 2014,, the Company transitioned itsour Russian juice operations to an existing joint venture with an unconsolidated bottling partner. This transferpartner and acquired a majority interest in bottling operations in Sri Lanka and Nepal. The impact of these changes is included as a structural change (a component of acquisitions and divestitures) in our analysis of net operating results for our Bottling Investments segment for the year ended December 31, 2014. In addition, we have eliminated the unit case volume and associated concentrate sales from the base year when calculating 2014 versus 2013 volume growth ratesrevenues on a consolidated basis as well as for our Eurasia and AfricaNorth America and Bottling Investments segments related to certain brands owned by the Russian juice company that have been discontinued as a result of this transition.operating segments. Refer to the headings "Beverage Volume" andheading "Net Operating Revenues" below.
In January 2014, the Venezuelan government enacted a new law ("Fair Price Law") that imposes limits on profit margins earned in the country, which limited the amount of revenue the Company was able to recognize in 2014 as compared to 2013. The impact of the Fair Price Law has been included as a structural change in our analysis of operating results for our Latin America segment for the year ended December 31, 2014.2014. Refer to the heading "Net Operating Revenues" below.
TheIn 2013, the Company acquired bottling operations in Vietnam and Cambodia in February 2012, bottling operations in Guatemala in June 2012, a majority interest in bottling operations in Myanmar, in June 2013, and a majority interest in bottling operations in Nepal and Sri Lanka in October 2014. In January 2013, the Company sold a majority interest in our previously consolidated bottling operations in the Philippines ("Philippine bottling operations"), and in July 2013 the Company deconsolidated our

43



bottling operations in Brazil ("Brazilian bottling operations") as a result of their combination with an independent bottling partner. Accordingly, the impact to net operating revenues related to these acquisitions and dispositions wastransactions is included as a structural change (a component of acquisitions and divestitures) in our analysis of changes to net operating revenues for our Bottling Investments segment. Refer to the heading "Net Operating Revenues" below.
The Company sells concentrates and syrups to both consolidated and unconsolidated bottling partners. The ownership structure of our bottling partners impacts the timing of recognizing concentrate revenue and concentrate sales volume. When we sell concentrates or syrups to our consolidated bottling partners, we are not able to recognize the concentrate revenue or concentrate sales volume until the bottling partner has sold finished products manufactured from the concentrates or syrups to a third party or independent customer. When we sell concentrates or syrups to our unconsolidated bottling partners, we recognize the concentrate revenue and concentrate sales volume when the concentrates or syrups are sold to the bottling partner. The subsequent sale of the finished products manufactured from the concentrates or syrups to a customer does not impact the timing of recognizing the concentrate revenue or concentrate sales volume. When we account for thean unconsolidated bottling partner as an equity method investment, we eliminate the intercompany profit related to these transactions until the equity method investee has sold finished products manufactured from the concentrates or syrups to a third party or independent customer.
"Acquired brands" refersThe Company is currently pursuing certain transactions that, if completed, will be included as structural changes for the applicable periods. In November 2014, the Company and two of our existing bottling partners entered into an agreement to brands acquiredcombine each of the parties' bottling operations in Southern and East Africa. In August 2015, the Company entered into an agreement to merge our German bottling operations with the bottling operations of two of our existing bottling partners. Subject to receiving any required regulatory and shareholder approvals, we expect each of these transactions to close during the past 12 months. Typically, the Company has not reported unit case volume or recognized concentrate sales volume relatedsecond quarter of 2016. Additionally, in 2016 we announced our intent to acquired brands in periods prior to the closingrefranchise 100 percent of the transaction. Therefore, the unit case volume and concentrate sales volume from the sale of these brands is incremental to prior year volume. We do not generally consider acquired brands to be structural changes.
"Licensed brands" refers to brands not ownedCompany-owned North America bottling territories by the end of 2017. The Company but for whichalso announced that we hold certain rights, generally including, but not limitedhave entered into a non-binding letter of intent to distribution rights, and from which we derive an economic benefit when these brands are ultimately sold. Typically, the Company has not reported unit case volume or recognized concentrate sales volume relatedrefranchise Company-owned bottling operations in China to these brands in periods prior to the beginningtwo of the term of a license agreement. Therefore, the unit case volume and concentrate sales volume from the sale of these brands is incremental to prior year volume. We do not generally consider new licensed brands to be structural changes.our existing bottling partners.

46



Beverage Volume
We measure the volume of Company beverage products sold in two ways: (1) unit cases of finished products and (2) concentrate sales. As used in this report, "unit case" means a unit of measurement equal to 192 U.S. fluid ounces of finished beverage (24 eight-ounce servings); and "unit case volume" means the number of unit cases (or unit case equivalents) of Company beverage products directly or indirectly sold by the Company and its bottling partners to customers. Unit case volume primarily consists of beverage products bearing Company trademarks. Also included in unit case volume are certain products licensed to, or distributed by, our Company, and brands owned by Coca-Cola system bottlers for which our Company provides marketing support and from the sale of which we derive economic benefit. In addition, unit case volume includes sales by certain joint ventures in which the Company has an equity interest. We believe unit case volume is one of the measures of the underlying strength of the Coca-Cola system because it measures trends at the consumer level. The unit case volume numbers used in this report are derived based on estimates received by the Company from its bottling partners and distributors. Concentrate sales volume represents the amount of concentrates and syrups (in all casesinstances expressed in equivalent unit cases) sold by, or used in finished beverages sold by, the Company to its bottling partners or other customers. Unit case volume and concentrate sales volume growth rates are not necessarily equal during any given period. Factors such as seasonality, bottlers' inventory practices, supply point changes, timing of price increases, new product introductions and changes in product mix can impact unit case volume and concentrate sales volume and can create differences between unit case volume and concentrate sales volume growth rates. In addition to the items mentioned above, the impact of unit case volume from certain joint ventures in which the Company has an equity interest but to which the Company does not sell concentrates or syrups may give rise to differences between unit case volume and concentrate sales volume growth rates.

44



Information about our volume growth by operating segment is as follows:
Percent Change  
Percent Change  
 
2014 vs. 2013 2013 vs. 20122015 vs. 2014 2014 vs. 2013 
Year Ended December 31,
Unit Cases1,2

 
Concentrate
       Sales

 
Unit Cases1,2

 
Concentrate
       Sales

Unit Cases1,2

 
Concentrate
       Sales

 
Unit Cases1,2

 
Concentrate
       Sales

 
Worldwide2% 2%
3 
2% 2%2% 2%
3 
2% 2%
4 
Eurasia & Africa4% 3% 7% 7%3% 2% 4% 3% 
Europe(2) (2) (1) (1)2
 2
 (2) (2) 
Latin America1
 
 1
 1
1
 1
 1
 
 
North America
 (1) 
 
1
 2
3 

 (1) 
Asia Pacific5
 5
 3
 5
4
 2
 5
 5
 
Bottling Investments(2) N/A
 (17) N/A
8
 N/A
 (2) N/A
 
1 
Bottling Investments operating segment data reflects unit case volume growth for consolidated bottlers only.
2 
Geographic segment data reflects unit case volume growth for all bottlers, both consolidated and unconsolidated, and distributors in the applicable geographic areas.
3 
After considering the impact of structural changes, concentrate sales volume both worldwide and for North America for the year ended December 31, 2015 grew 1 percent.
4
After considering the impact of structural changes, worldwide concentrate sales volume for the year ended December 31, 2014 grew 1 percent.

Unit Case Volume
The Coca-Cola system sold 29.2 billion, 28.6 billion 28.2 billion and 27.728.2 billion unit cases of our products in 2015, 2014 2013 and 2012,2013, respectively. The number of unit cases sold in 2015 and 2014 does not include certain licensed beverage brands sold in the North American refranchised territories and certain brands owned by our Russian juice company. Refer to the heading "Structural Changes, Acquired Brands and Newly Licensed Brands" above. The Company eliminated the unit case volume related to these structural changes from the base year, where applicable, when calculating 2014 versus 2013the volume growth rates.

47



Year Ended December 31, 2015 versus Year Ended December 31, 2014
Unit case volume in Eurasia and Africa increased 3 percent, which consisted of 2 percent growth in sparkling beverages and 6 percent growth in still beverages. The group's sparkling beverage growth included 3 percent growth in Trademark Coca-Cola, and the growth in still beverages was led by packaged water and juices and juice drinks. Eurasia and Africa benefited from unit case volume growth of 8 percent, 6 percent and 2 percent in the Central, East & West Africa, Southern Africa, and Middle East & North Africa business units, respectively, partially offset by a decline of 4 percent in the Russia, Ukraine & Belarus business unit.
In Europe, unit case volume grew 2 percent, reflecting 7 percent growth in still beverages and 1 percent growth in sparkling beverages. The growth in still beverages was driven by the group's performance in packaged water, teas, sports drinks and the expansion of the innocent brand. The group's sparkling beverage growth included 9 percent growth in Coca-Cola Zero and 4 percent growth in Trademark Fanta.
Unit case volume in Latin America grew 1 percent as a result of growth in still beverages of 4 percent and even sparkling beverage volume. The growth in still beverages was led by growth in packaged water, juices and juice drinks and sports drinks. The Latin Center and South Latin business units reported unit case volume growth of 4 percent and 3 percent, respectively. The Mexico business unit reported unit case volume growth of 3 percent, reflecting growth in Trademark Coca-Cola of 3 percent. The growth in the Latin Center, South Latin and Mexico business units was partially offset by a unit case volume decline of 4 percent in the Brazil business unit.
In North America, unit case volume grew 1 percent. This increase reflects 5 percent growth in still beverage volume and even sparkling beverage volume. The still beverage growth in the group was led by 8 percent growth in packaged water and 6 percent growth in teas. After considering the impact of the acquired volume resulting from the Monster Transaction, North America unit case volume growth remained 1 percent.
Unit case volume in Asia Pacific increased 4 percent, which consisted of 4 percent growth in both sparkling and still beverage volume. The sparkling beverage volume growth was led by a 5 percent increase in Trademark Coca-Cola, a 4 percent increase in Trademark Sprite and a 6 percent increase in Trademark Fanta. Still beverage volume growth was led by increases in packaged water and teas of 12 percent and 6 percent, respectively. China's unit case volume grew 5 percent during the year, led by 12 percent growth in Trademark Coca-Cola and 3 percent growth in Trademark Sprite. India reported unit case volume growth of 4 percent and Japan reported even volume during the year.
Unit case volume for Bottling Investments increased 8 percent. This increase primarily reflects the growth in China and India. In addition, unit case volume in Germany grew 2 percent. The Company's consolidated bottling operations accounted for 34 percent, 69 percent, and 100 percent of the unit case volume in China, India and Germany, respectively.
Year Ended December 31, 2014 versus Year Ended December 31, 2013
Unit case volume in Eurasia and Africa increased 4 percent, which consisted of 3 percent growth in sparkling beverages and 8 percent growth in still beverages. The group's sparkling beverage growth included 2 percent growth in Trademark Coca-Cola, 3 percent growth in Trademark Sprite, and 2 percent growth in Trademark Fanta. Growth in the group's still beverages was led by packaged water, juices and juice drinks and teas. The group's growth reflects a continued focus on improved marketplace execution and providing greater consumer choice in package and price options. Eurasia and Africa benefited from unit case volume growth of 7 percent and 6 percent in the Middle East & North Africa and Central, East & West Africa business units, respectively. This growth was partially offset by a decline in unit case volume of 1 percent in the Russia, Ukraine & Belarus business unit.
In Europe, unit case volume declined 2 percent as a result of a decline in sparkling beverages of 3 percent, partially offset by growth in still beverages of 1 percent. The decline in sparkling beverages reflects the softness in the macroeconomic environment and continuing competitive pressures in the market. The growth in still beverages was led by growth in juices and juice drinks. The group reported a decline in unit case volume of 6 percent in the Central & Southern Europe business unit and volume declines of 2 percent and 1 percent in the Iberia and Northwest Europe & Nordics business units, respectively. Unit case volume in Germany was even.
Unit case volume in Latin America increased 1 percent reflecting growth in still beverages of 6 percent and even sparkling beverage volume. The growth in still beverages was led by packaged water, value-added dairy and sports drinks. Latin America benefited from unit case volume growth of 6 percent and 2 percent in the Latin Center and Brazil business units, respectively, partially offset by a volume decline of 1 percent in the Mexico business unit. The decline in Mexico iswas primarily due to the impact of a new excise tax that went into effect on January 1, 2014.
In North America, unit case volume was even, reflecting 1 percent growth in still beverages offset by a decline of 1 percent in sparkling beverages. The still beverage growth was led by 8 percent growth in packaged water and 4 percent growth in teas.

48



Unit case volume in Asia Pacific increased 5 percent, which consisted of 5 percent growth in sparkling beverages and 4 percent growth in still beverages. The growth in sparkling beverages was led by a 5 percent increase in Trademark Sprite, a 4 percent increase in Trademark Fanta and a 3 percent increase in brand Coca-Cola. Still beverage volume growth was led by packaged water and growth in teas and value-added dairy of 6 percent and 10 percent, respectively. China's unit case volume grew 4 percent, led by 5 percent growth in brand Coca-Cola and 6 percent growth in Trademark Fanta. India reported double-digit

45



volume growth, and Japan reported a volume decline of 1 percent, reflecting 1 percent growth in sparkling beverages offset by a 1 percent decline in still beverages.
Unit case volume for Bottling Investments decreased 2 percent. This decrease primarily reflects the deconsolidation of our bottling operations in Brazil during July 2013 as a result of their combination with an independent bottling partner. The unfavorable impact of these transactions on the group's unit case volume results was partially offset by growth in other key markets, including China and India, where we own or otherwise consolidate bottling operations. The Company's consolidated bottling operations accounted for 35 percent and 65 percent of the unit case volume in China and India, respectively.
Year Ended December 31, 2013 versus Year Ended December 31, 2012Concentrate Sales Volume
In Eurasia2015, worldwide concentrate sales volume and Africa unit case volume increased 7both grew 2 percent which consisted of 6 percent growth in sparkling and 13 percent growth in still beverages. The group's sparkling beverage growth was led by 6 percent growth in brand Coca-Cola, 5 percent growth in Trademark Sprite and 3 percent growth in Trademark Fanta. This growth reflects a continued focus on driving exceptional capabilities in the marketplace, integrated marketing campaigns and greater consumer choice in package and price options. Growth in still beverages was led by packaged water, juices and juice drinks, and teas. Russia reported unit case growth of 3 percent, driven by growth of 11 percent in brand Coca-Cola. Still beverage growth in Russia included growth of 7 percent and 24 percent in our juice brands Dobriy and Rich, respectively. Unit case growth in Russia was favorably impacted by the Company's marketing activities relatedcompared to the Sochi 2014 Winter Olympics and Olympic Torch Relay. Eurasia and Africa also benefited from unit case volume growth of 14 percent in the Company's Middle East & North Africa business unit, including a 5 percent benefit primarily related to our Aujan partnership, and 8 percent growth in the Company's Central, East & West Africa business unit.
Unit case volume in Europe declined 1 percent, which consisted of a 1 percent decline in sparkling beverages and a 5 percent decline in still beverages, primarily packaged water and teas. These declines reflect2014. After considering the impact of particularly poor weather across many countries during the second quarter of 2013, including severe flooding in parts of Germany and Central Europe, competitive pricing, and ongoing weakness in consumer confidence and spending across the region. In spite of these challenges, our Germany business unit reported growth of 2 percent and our Northwest Europe & Nordics business unit reported growth of 1 percent. This growth was driven by the Company's strong commercial campaigns such as "Share a Coke," "Coke with Meals," and the Coca-Cola Christmas Truck Tour. These increases were offset by a decline in unit casestructural changes, concentrate sales volume of 4 percent in the Central & Southern Europe business unit and a volume decline of 3 percent in the Iberia business unit, both of which continue to manage through very tough macroeconomic conditions.
In Latin America, unit case volume increased 1 percent, which primarily reflects 8 percent growth in still beverages while volume in sparkling beverages was even. The group reported growth of 6 percent in the Latin Center business unit and growth of 4 percent in the South Latin business unit, driven by strong activation of brand and category advertising as well as investments in cold-drink equipment and continued segmentation across multiple price points and package sizes. The group's still beverage growth reflects increases in the tea, packaged water, and juice and juice drink categories of 16 percent, 6 percent and 5 percent, respectively. Argentina reported unit case growth of 7 percent, led by strong growth in Trademark Bonaqua and 5 percent growth in brand Coca-Cola. The growth in the Mexico business unit was even due to a slower economy and the significant disruption caused by hurricanes Manuel and Ingrid in September 2013. Volume in Brazil declined 2 percent, which reflects some consumer uncertainty given the economic slowdown in the country.
Unit case volume in North America was even reflecting overall category softness, unseasonably cold and wet weather during the second quarter of 2013 and weak consumer confidence, which negatively impacted consumer spending. Sparkling beverages declined 2 percent, whereas still beverages grew 5 percent during the period. Still beverage growth in North America was led by strong performance in teas, juices and juice drinks and packaged water. The group continued to implement a multi-brand strategy around teas and reported 15 percent volume growth, primarily due to increases in Gold Peak, Honest Tea and Fuze. Volume growth in juices and juice drinks was 4 percent, led by 7 percent growth in Trademark Simply, and packaged water volume benefited from strong growth in Dasani and smartwater.
In Asia Pacific, unit case volume increased 3 percent, which consisted of 3 percent growth in sparkling beverages and 4 percent growth in still beverages. Sparkling beverage growth was led by 5 percent growth in brand Coca-Cola and 4 percent growth in Trademark Fanta. India reported 4 percent unit case volume growth, led by growth of 18 percent in brand Coca-Cola and 5 percent growth in Trademark Sprite. India's growth reflects the impact of strong integrated marketing campaigns and continued expansion of packaging choices to consumers. Japan's unit case growth was 1 percent during the period, including 2 percent growth in sparkling beverages. China reported unit case volume growth of 3 percent, including volume growth of 4 percent in sparkling beverages and 3 percent in still beverages. The group's volume results also benefited from 25 percent growth in Vietnam and 9 percent growth in Thailand, partially offset by declines of 3 percent in the Philippines and 4 percent in Australia.

46



Unit case volume for Bottling Investments decreased 17 percent. This decrease primarily reflects the sale of a majority ownership interest in our previously consolidated bottling operations in the Philippines to Coca-Cola FEMSA, S.A.B. de C.V. ("Coca-Cola FEMSA") in January 2013, as well as the deconsolidation of our bottling operations in Brazil during July 2013 as a result of their combination with an independent bottling partner. The unfavorable impact of these transactions on the group's unit case volume results was partially offset by growth in other key markets, including China and India, where we own or otherwise consolidate bottling operations. The Company's consolidated bottling operations accounted for 35 percent and 65 percent of the unit case volume in China and India, respectively.
Concentrate Sales Volume
year ended December 31, 2015. In 2014, worldwide concentrate sales volume grew 2 percent and unit case volume both grew 2 percent compared to 2013. After considering the impact of structural changes, concentrate sales volume grew 1 percent during the year ended December 31, 2014. In 2013, concentrate sales volume and unit case volume both grew 2 percent compared to 2012. The differences between concentrate sales volume and unit case volume growth rates worldwide and for individual operating segments in 20142015 and 20132014 were primarily due to the timing of concentrate shipments and the impact of unit case volume from certain joint ventures in which the Company has an equity interest, but to which the Company does not sell concentrates, syrups, beverage bases or powders.
Analysis of Consolidated Statements of Income
      
Percent Change  
      
Percent Change  
Year Ended December 31,2014
 2013
 2012
 2014 vs. 2013 2013 vs. 20122015
 2014
 2013
 2015 vs. 2014 2014 vs. 2013
(In millions except percentages and per share data)              
NET OPERATING REVENUES$45,998
 $46,854
 $48,017
 (2)% (2)%$44,294
 $45,998
 $46,854
 (4)% (2)%
Cost of goods sold17,889
 18,421
 19,053
 (3) (3)17,482
 17,889
 18,421
 (2) (3)
GROSS PROFIT28,109
 28,433
 28,964
 (1) (2)26,812
 28,109
 28,433
 (5) (1)
GROSS PROFIT MARGIN61.1% 60.7% 60.3%  
  60.5% 61.1% 60.7%  
  
Selling, general and administrative expenses17,218
 17,310
 17,738
 (1) (2)16,427
 17,218
 17,310
 (5) (1)
Other operating charges1,183
 895
 447
 *
 *
1,657
 1,183
 895
 40
 32
OPERATING INCOME9,708
 10,228
 10,779
 (5) (5)8,728
 9,708
 10,228
 (10) (5)
OPERATING MARGIN21.1% 21.8% 22.4%  
  19.7% 21.1% 21.8%  
  
Interest income594
 534
 471
 11
 13
613
 594
 534
 3
 11
Interest expense483
 463
 397
 4
 17
856
 483
 463
 77
 4
Equity income (loss) — net769
 602
 819
 28
 (27)489
 769
 602
 (36) 28
Other income (loss) — net(1,263) 576
 137
 *
 *
631
 (1,263) 576
 *
 *
INCOME BEFORE INCOME TAXES9,325
 11,477
 11,809
 (19) (3)9,605
 9,325
 11,477
 3
 (19)
Income taxes2,201
 2,851
 2,723
 (23) 5
2,239
 2,201
 2,851
 2
 (23)
Effective tax rate23.6% 24.8% 23.1%  
  
23.3% 23.6% 24.8%  
  
CONSOLIDATED NET INCOME7,124
 8,626
 9,086
 (17) (5)7,366
 7,124
 8,626
 3
 (17)
Less: Net income attributable to noncontrolling interests26
 42
 67
 (38) (38)15
 26
 42
 (40) (38)
NET INCOME ATTRIBUTABLE TO SHAREOWNERS OF
THE COCA-COLA COMPANY
$7,098
 $8,584
 $9,019
 (17)% (5)%$7,351
 $7,098
 $8,584
 4 % (17)%
BASIC NET INCOME PER SHARE1
$1.62
 $1.94
 $2.00
 (16)% (3)%$1.69
 $1.62
 $1.94
 4 % (16)%
DILUTED NET INCOME PER SHARE1
$1.60
 $1.90
 $1.97
 (16)% (4)%$1.67
 $1.60
 $1.90
 5 % (16)%
* 
Calculation is not meaningful.
1 
Calculated based on net income attributable to shareowners of The Coca-Cola Company.

4749



Net Operating Revenues
Year Ended December 31, 20142015 versus Year Ended December 31, 20132014
The Company's net operating revenues decreased $856$1,704 million, or 24 percent.
The following table illustrates, on a percentage basis, the estimated impact of key factors resulting in the increase (decrease) in net operating revenues for each of our operating segments:
Percent Change 2014 vs. 2013Percent Change 2015 vs. 2014
Volume1

 Structural Changes
 
Price, Product &
Geographic Mix

 
Currency
Fluctuations

 Total
Volume1

 Acquisitions & Divestitures
 
Price, Product &
Geographic Mix

 
Currency
Fluctuations

 Total
Consolidated1% (2)% 1% (2)% (2)%1% % 2% (7)% (4)%
Eurasia & Africa3% % 4% (8)% (1)%2% (1)% 3% (14)% (10)%
Europe(2) 
 4
 2
 4
2
 (1) 1
 (9) (7)
Latin America
 (4) 8
 (10) (6)1
 
 9
 (23) (13)
North America(1) (1) 1
 
 (1)1
 (1) 3
 (1) 2
Asia Pacific5
 1
 (2) (6) (2)2
 
 (3) (8) (9)
Bottling Investments5
 (9) (2) (2) (8)6
 3
 (3) (10) (4)
Corporate*
 *
 *
 *
 *
*
 *
 *
 *
 *
* Calculation is not meaningful.
1 
Represents the percent change in net operating revenues attributable to the increase (decrease) in concentrate sales volume for our geographic operating segments (expressed in equivalent unit cases) after considering the impact of structural changes. For our Bottling Investments operating segment, this represents the percent change in net operating revenues attributable to the increase (decrease) in unit case volume after considering the impact of structural changes. Our Bottling Investments operating segment data reflects unit case volume growth for consolidated bottlers only. Refer to the heading "Beverage Volume" above.
Refer to the heading "Beverage Volume" above for additional information related to changes in our unit case and concentrate sales volumes.
"Acquisitions and Divestitures" refers to acquisitions and divestitures of brands or businesses, some of which the Company considers to be structural changes. Refer to the heading "Structural Changes, Acquired Brands and Newly Licensed Brands" above for additional information related to the structural changes. The acquisitions and divestitures percent changes. for 2015 versus 2014 in the table above consisted entirely of structural changes.
Price, product and geographic mix had a favorable 12 percent impact on our consolidated net operating revenues. Price, product and geographic mix was impacted by a variety of factors and events including, but not limited to, the following:
Eurasia and Africa — favorable price mix in allmost of the segment's business units;
Europe — favorable impact as a result of consolidating the juice and smoothie business of Fresh Trading Ltd. ("innocent") in May 2013 and favorable price mix in the Central & Southern Europe, Northwest Europe & Nordics, and Iberia business units;units, partially offset by unfavorable geographic mix;
Latin America — favorable price mix in all four of the segment's business units and the impact of inflationary environments in certain markets;
North America — favorably impacted as a result of price increases and package mix;
Asia Pacific — unfavorable product and channel mix as well as unfavorable geographic mix; and
Bottling Investments — unfavorable price mix attributable to channel, product and package mix.
The unfavorable impact of foreign currency fluctuations decreased our consolidated net operating revenues by 27 percent. TheThis unfavorable impact of changes in foreign currency exchange rates was primarily due to a stronger U.S. dollar compared to certain other foreign currencies, including the South African rand, euro, U.K. pound sterling, Brazilian real, Mexican peso, Brazilian real, Australian dollar and Japanese yen, which had an unfavorable impact on our Eurasia and Africa, Europe, Latin America, Asia Pacific and Bottling Investments operating segments. The unfavorable impact of a stronger U.S. dollar compared to the currencies listed above was partially offset by the impact of a weaker U.S. dollar compared to certain other foreign currencies, including the euro and British pound, which had a favorable impact on our Europe and Bottling Investments operating segments. Refer to the heading "Liquidity, Capital Resources and Financial Position — Foreign Exchange" below.
Net operating revenue growth rates are impacted by sales volume; structural changes;acquisitions and divestitures; price, product and geographic mix; and foreign currency fluctuations. The size and timing of structural changesacquisitions and divestitures are not consistent from period to period. The Company currently expects acquisitions and divestitures to have a mid single-digit unfavorable impact of the Venezuelan Fair Price Law reducedon full year 2016 net operating revenues. Based on current spot rates and our Latin America segment revenues by 5 percenthedging coverage in 2014.place, we expect currencies will continue to have an unfavorable impact on our full year 2016 net operating revenues.

4850



Year EndedDecember 31, 20132014 versus Year EndedDecember 31, 20122013
The Company's net operating revenues decreased $1,163$856 million, or 2 percent.
The following table illustrates, on a percentage basis, the estimated impact of key factors resulting in the increase (decrease) in net operating revenues for each of our operating segments:
Percent Change 2013 vs. 2012Percent Change 2014 vs. 2013
Volume1

 Structural Changes
 
Price, Product &
Geographic Mix

 
Currency
Fluctuations

 Total
Volume1

 Acquisitions & Divestitures
 
Price, Product &
Geographic Mix

 
Currency
Fluctuations

 Total
Consolidated2% (3)% 1% (2)% (2)%1% (2)% 1% (2)% (2)%
Eurasia & Africa7% % 2% (7)% 2%3% % 4% (8)% (1)%
Europe(1) 
 5
 
 4
(2) 
 4
 2
 4
Latin America1
 (1) 10
 (8) 2

 (4) 8
 (10) (6)
North America
 (1) 1
 
 
(1) (1) 1
 
 (1)
Asia Pacific5
 (2) (4) (6) (7)5
 1
 (2) (6) (2)
Bottling Investments4
 (18) 1
 (1) (14)5
 (9) (2) (2) (8)
Corporate*
 *
 *
 *
 *
*
 *
 *
 *
 *
* Calculation is not meaningful.
1 
Represents the percent change in net operating revenues attributable to the increase (decrease) in concentrate sales volume for our geographic operating segments (expressed in equivalent unit cases) after considering the impact of structural changes. For our Bottling Investments operating segment, this represents the percent change in net operating revenues attributable to the increase (decrease) in unit case volume after considering the impact of structural changes. Our Bottling Investments operating segment data reflects unit case volume growth for consolidated bottlers only. Refer to the heading "Beverage Volume" above.
Refer to the heading "Beverage Volume" above for additional information related to changes in our unit case and concentrate sales volumes.
"Acquisitions and Divestitures" refers to acquisitions and divestitures of brands or businesses, some of which the Company considers to be structural changes. Refer to the heading "Structural Changes, Acquired Brands and Newly Licensed Brands" above for additional information related to the structural changes. The acquisitions and divestitures percent change for 2014 versus 2013 in the table above consisted entirely of structural changes. The impact of the Venezuelan Fair Price Law reduced our Latin America segment revenues by 5 percent in 2014.
Price, product and geographic mix had a favorablefavorable 1 percent impact on our consolidated net operating revenues. Price, product and geographic mix was impacted by a variety of factors and events including, but not limited to, the following:
Consolidated — unfavorable impact of geographic mix as a result of growth in our emerging and developing markets exceeding growth in our developed markets. The revenue per unit sold in our emerging markets is generally less than in developed markets;
Eurasia and Africa — favorable impactprice mix in all of price increases in a number of key markets partially offset by unfavorable geographic mix;the segment's business units;
Europe — favorable impact as a result of consolidating innocent as well asthe juice and smoothie business of Fresh Trading Ltd. ("innocent") in May 2013 and favorable price increasesmix in certain markets;all of the segment's business units;
Latin America — favorable impact as a result of pricingprice mix in all four of ourthe segment's business units as well asand the impact of inflationary environments in certain markets; and
Asia Pacific — unfavorable impact of geographic mix as well as shifts in product and package mix within individual markets.mix.
The unfavorable impact of foreign currency fluctuations decreased our consolidated net operating revenues by 2 percent. The unfavorable impact of changes in foreign currency exchange ratesimpact was primarily due to a stronger U.S. dollar compared to certain other foreign currencies, including the South African rand, British pound,Mexican peso, Brazilian real, Australian dollar and Japanese yen, which impacted thehad an unfavorable impact on our Eurasia and Africa, Europe, Latin America, Asia Pacific and Bottling Investments operating segments. The unfavorable impact of a stronger U.S. dollar compared to the currencies listed above was partially offset by the impact of a weaker U.S. dollar compared to certain other foreign currencies, including the euro and Mexican peso,British pound, which had a favorable impact on our Europe Latin America and Bottling Investments operating segments. Refer to the heading "Liquidity, Capital Resources and Financial Position — Foreign Exchange" below.

4951



Net Operating Revenues by Operating Segment
Information about our net operating revenues by operating segment as a percentage of Company net operating revenues is as follows:
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
Eurasia & Africa5.9% 5.9% 5.6%5.5% 5.9% 5.9%
Europe10.5
 9.9
 9.3
10.3
 10.5
 9.9
Latin America10.0
 10.1
 9.5
9.0
 10.0
 10.1
North America46.7
 46.1
 45.1
49.2
 46.7
 46.1
Asia Pacific11.4
 11.5
 11.9
10.6
 11.4
 11.5
Bottling Investments15.2
 16.2
 18.3
15.1
 15.2
 16.2
Corporate0.3
 0.3
 0.3
0.3
 0.3
 0.3
100.0% 100.0% 100.0%
Total100.0% 100.0% 100.0%
The percentage contribution of each operating segment fluctuates over time due to net operating revenues in certain operating segments growing at a faster rate compared to other operating segments. Net operating revenue growth rates are impacted by sales volume; structural changes;acquisitions and divestitures; price, product and geographic mix; and foreign currency fluctuations. The size and timing of structural changes are not consistent from period to period. As a result, anticipating the impact of such events on future net operating revenues, and other financial statement line items, usually is not possible. We expect structural changes to have an impact on our consolidated financial statements in future periods. For additional information about the impact of foreign currency fluctuations, refer to the heading "Liquidity, Capital Resources and Financial Position — Foreign Exchange" below.
Gross Profit Margin
As a result of our finished goods operations, which are primarily included in our North America and Bottling Investments operating segments, the following inputs represent a substantial portion of the Company's total cost of goods sold: (1) sweeteners, (2) metals, (3) juices and (4) PET. The Company hedgesenters into hedging activities related to certain commodities in order to mitigate a portion of the price risk associated with forecasted purchases. Many of the derivative financial instruments used by the Company to mitigate the risk associated with these commodity exposures, including any related foreign currency exposure, do not qualify for hedge accounting. As a result, the changes in fair value of these derivative instruments have been, and will continue to be, included as a component of net income in each reporting period. The Company recorded losses related to these derivatives of $206 million, $8 million $120 million and $110$120 million during the years ended December 31, 2015, 2014 2013 and 20122013, respectively, in the line item cost of goods sold in our consolidated statements of income. Refer to Note 5 of Notes to Consolidated Financial Statements. We do not currently expect changes in commodity costs to have a significant impact on our 20152016 gross profit margin as compared to 2014.2015.
Year Ended December 31, 20142015 versus Year Ended December 31, 2014
Our gross profit margin decreased to 60.5 percent in 2015 from 61.1 percent in 2014. The decrease was primarily due to the impact of acquisitions and divestitures and the unfavorable impact of foreign currency exchange rate fluctuations, partially offset by positive price mix and slightly lower commodity costs. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information related to acquisitions and divestitures.
Year Ended December 31, 2014 versus Year EndedDecember 31, 2013
Our gross profit margin increased to 61.1 percent in 2014 from 60.7 percent in 2013. The increase iswas partially due to the deconsolidation of our Brazilian bottling operations in July 2013 as well as lower commodity costs, primarily in our North America finished goods business, and favorable geographic mix. Refer to the heading "Structural Changes, Acquired Brands and Newly Licensed Brands" aboveNote 2 of Notes to Consolidated Financial Statements for additional information regarding the impact of the deconsolidation of our Brazilian bottling operations.
The favorable geographic mix was primarily due to growth in emerging markets. Although this shift in geographic mix has a negative impact on net operating revenues, it generally has a favorable impact on our gross profit margin due to the correlated impact it has on our product mix. The product mix in the majority of our emerging and developing markets is more heavily skewed toward our sparkling beverage products, which generally yield a higher gross profit margin compared to our still beverages and finished products.
Year EndedDecember 31, 2013 versus Year EndedDecember 31, 2012
Our gross profit margin increased to 60.7 percent in 2013 from 60.3 percent in 2012. The increase is partially due to the deconsolidation of our Philippine bottling operations in January 2013 and the deconsolidation of our Brazilian bottling operations in July 2013. Refer to the heading "Structural Changes, Acquired Brands and Newly Licensed Brands" above for additional information regarding the impact of the deconsolidation of our Philippine and Brazilian bottling operations.

5052



Selling, General and Administrative Expenses
The following table sets forth the significant components of selling, general and administrative expenses (in millions):
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
Stock-based compensation expense$209
 $227
 $259
$236
 $209
 $227
Advertising expenses3,499
 3,266
 3,342
3,976
 3,499
 3,266
Bottling and distribution expenses8,381
 8,510
 8,905
Selling and distribution expenses6,025
 6,412
 6,419
Other operating expenses5,129
 5,307
 5,232
6,190
 7,098
 7,398
Selling, general and administrative expenses$17,218
 $17,310
 $17,738
$16,427
 $17,218
 $17,310
Year Ended December 31, 2015 versus Year Ended December 31, 2014
Selling, general and administrative expenses decreased $791 million, or 5 percent. During the year ended December 31, 2015, fluctuations in foreign currency decreased selling, general and administrative expenses by 6 percent. The increase in stock-based compensation was primarily due to reversals in 2014 of previously recognized expenses related to the Company's long-term incentive programs as performance criteria were not achieved. The increase in advertising expenses reflects the Company's increased investments to strengthen our brands, partially offset by a foreign currency exchange impact of 13 percent. The decrease in selling and distribution expenses reflects the impact of acquisitions and divestitures. The decrease in other operating expenses reflects the shift of the Company's marketing spending to more consumer-facing advertising expenses as well as savings from our productivity and reinvestment initiatives. Foreign currency exchange rate fluctuations have a more significant impact on both advertising and other operating expenses as compared to our selling and distribution expenses since they are generally transacted in local currency. Our selling and distribution expenses are primarily related to our Company-owned bottling operations, of which the majority of expenses are attributable to CCR and are primarily denominated in U.S. dollars. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information related to acquisitions and divestitures.
In 2016, our pension expense is expected to decrease by $200 million compared to 2015. The anticipated decrease is primarily due to settlement and special termination costs incurred in 2015 of $169 million, the new method to calculate service and interest costs, an increase in the weighted-average discount rate used to calculate the Company's benefit obligations and the impact of $471 million of contributions the Company made in early 2016 to U.S. pension plans. The impact of these items will be partially offset by unfavorable asset performance compared to our expected return during 2015 and a decrease in the expected return on assets for U.S. plans. Refer to the heading "Liquidity, Capital Resources and Financial Position" below for information related to these contributions. Refer to the heading "Critical Accounting Policies and Estimates — Pension Plan Valuations" above and Note 13 of Notes to Consolidated Financial Statements for additional information related to the pension plan assumptions used by the Company.
As of December 31, 2015, we had $319 million of total unrecognized compensation cost related to nonvested share-based compensation arrangements granted under our plans. This cost is expected to be recognized over a weighted-average period of 1.8 years as stock-based compensation expense. This expected cost does not include the impact of any future stock-based compensation awards. Refer to Note 12 of Notes to Consolidated Financial Statements.
Year Ended December 31, 2014 versus Year Ended December 31, 2013
Selling, general and administrative expenses decreased $92 million, or 1 percent. Foreign currency fluctuations decreased selling, general and administrative expenses by 2 percent. The decrease in stock-based compensation was primarily due to reversals in 2014 of previously recognized expenses related to the Company's long-term incentive compensation programs. The increase in advertising expenses reflects the Company'scompany's increased investmentsinvestment to strengthen our brands. This increase was partially offset by a foreign currency exchange impact of 4 percent. The decrease in bottlingselling and distribution expenses is a result of the refranchising of certain territories in North America in 2014 and the deconsolidation of our Brazilian bottling operations as a result of their combination with an independent bottling partner in July 2013.
In 2015, our pension expense is expected to increase by approximately $100 million compared to 2014. The anticipated increase is primarily due to a decrease in the weighted-average discount rate used to calculate the Company's benefit obligation, unfavorable asset performance compared to our expected return during 2014 and the adoption of more conservative mortality assumptions for U.S. plans partially offset by the impact of approximately $90 million of contributions expected to be made by the Company to our international plans. Refer to the heading "Liquidity, Capital Resources and Financial Position" below for information related to these contributions. Refer to the heading "Critical Accounting Policies and Estimates — Pension Plan Valuations" above and Note 13 of Notes to Consolidated Financial Statements for additional information related to the pension plan assumptions used by the Company.
As of December 31, 2014, we had $437 million of total unrecognized compensation cost related to nonvested share-based compensation arrangements granted under our plans. This cost is expected to be recognized over a weighted-average period of 2.2 years as stock-based compensation expense. This expected cost does not include the impact of any future stock-based compensation awards. Refer to Note 12 of Notes to Consolidated Financial Statements.
Year EndedDecember 31, 2013 versus Year EndedDecember 31, 2012
Selling, general and administrative expenses decreased $428 million, or 2 percent. Foreign currency fluctuations decreased selling, general and administrative expenses by 1 percent. The decrease in stock-based compensation was primarily due to reversals in 2013 of previously recognized expenses related to the Company's long-term incentive compensation programs. As a result of the Company's revised outlook, including the unfavorable impact foreign currency fluctuations are projected to have on certain performance periods, the Company lowered the estimated payouts associated with these periods. Advertising expenses were impacted by shifts in our marketing and media spend strategies, primarily due to spending more marketing dollars toward in-store activations, loyalty points programs and point-of-sale marketing. Many of these strategies impact net operating revenues instead of marketing expenses. The decrease in bottling and distribution expenses includes the impact of the Company's sale of a majority interest in our previously consolidated Philippine bottling operations to Coca-Cola FEMSA in January 2013 and the deconsolidation of our Brazilian bottling operations as a result of their combination with an independent bottling partner in July 2013, partially offset by the impact of our acquisition of bottling operations in Vietnam, Cambodia, Guatemala and the United States in 2012.

5153



Other Operating Charges
Other operating charges incurred by operating segment were as follows (in millions):
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
Eurasia & Africa$26
 $2
 $
$16
 $26
 $2
Europe111
 57
 (3)(25) 111
 57
Latin America295
 
 
40
 295
 
North America281
 277
 255
384
 281
 277
Asia Pacific38
 47
 1
3
 38
 47
Bottling Investments247
 194
 164
357
 247
 194
Corporate185
 318
 30
882
 185
 318
Total$1,183
 $895
 $447
$1,657
 $1,183
 $895
In 2015, the Company incurred other operating charges of $1,657 million. These charges included $691 million due to the Company's productivity and reinvestment program and $292 million due to the integration of our German bottling operations. In addition, the Company recorded impairment charges of $418 million primarily due to the discontinuation of the energy products in the glacéau portfolio as a result of the Monster Transaction and incurred a charge of $100 million due to a cash contribution we made to The Coca-Cola Foundation. The Company also incurred a charge of $111 million due to the write-down we recorded related to receivables from our bottling partner in Venezuela and an impairment of a Venezuelan trademark primarily due to changes in exchange rates as a result of the establishment of the new open market exchange system. Refer to Note 18 of Notes to Consolidated Financial Statements for additional information on the Company's productivity, integration and restructuring initiatives. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information on the Monster Transaction. Refer to Note 1 of Notes to Consolidated Financial Statements for additional information on the Venezuelan currency change. Refer to Note 19 of Notes to Consolidated Financial Statements for the impact these charges had on our operating segments.
In 2014, the Company incurred other operating charges of $1,183 million.$1,183 million. These charges primarily consisted of $601$601 million due to the Company's productivity and reinvestment program and $208$208 million due to the integration of our German bottling and distribution operations. In addition, the Company incurred a charge of $314 million due to a write-down we recorded related to our concentrate sales receivables from our bottling partner in Venezuela and an impairment of a Venezuelan trademark primarily due to higher exchange rates. The write-down was recorded as a result of our revised assessment of the U.S. dollar value we expect to realize upon the conversion of the Venezuelan bolivar into U.S. dollars by our bottling partner to pay our concentrate sales receivables. The Company also recorded a loss of $36$36 million as a result of the restructuring and transition of the Company's Russian juice operations to an existing joint venture with an unconsolidated bottling partner. Refer to Note 18 of Notes to Consolidated Financial Statements and see below for additional information on our productivity and reinvestment program as well as the Company's other productivity, integration and restructuring initiatives. Refer to Note 1 of Notes to Consolidated Financial Statements for additional information on the Venezuelan currency rate change. Refer to Note 19 of Notes to Consolidated Financial Statements for the impact these charges had on our operating segments.
In 2013, the Company incurred other operating charges of $895$895 million,, which primarily consisted of $494$494 million associated with the Company's productivity and reinvestment program; $195 million due to the impairment of certain intangible assets; $188 million due to the Company's other productivity, integration and restructuring initiatives; and $22 million due to charges associated with certain of the Company's fixed assets. Refer to Note 17 of Notes to Consolidated Financial Statements for further information on the impairment charges. Refer to Note 18 of Notes to Consolidated Financial Statements and see below for further information on the Company's productivity and reinvestment program, as well as the Company's other productivity, integration and restructuring initiatives. Refer to Note 19 of Notes to Consolidated Financial Statements for the impact these charges had on our operating segments.
In 2012, the Company incurred other operating charges of $447 million, which primarily consisted of $270 million associated with the Company's productivity and reinvestment program; $163 million related to the Company's other restructuring and integration initiatives; $20 million due to changes in the Company's ready-to-drink tea strategy as a result of our U.S. license agreement with Nestlé terminating at the end of 2012; and $8 million due to costs associated with the Company detecting carbendazim in orange juice imported from Brazil for distribution in the United States. These charges were partially offset by reversals of $10 million associated with the refinement of previously established accruals related to the Company's 2008–2011 productivity initiatives, as well as reversals of $6 million associated with the refinement of previously established accruals related to the Company's integration of CCE's former North America business. Refer to Note 18 of Notes to Consolidated Financial Statements and see below for additional information on the Company's productivity, integration and restructuring initiatives. Refer to Note 19 of Notes to Consolidated Financial Statements for the impact these charges had on our operating segments.
Productivity and Reinvestment Program
In February 2012, the Company announced a four-year productivity and reinvestment program. This program is designed to assist us in strengtheningfurther enable our efforts to strengthen our brands and reinvestingreinvest our resources to drive long-term profitable growth. The first component of thisThis program is a global productivity initiative that will target annualized productivity of $350 million to $400 million. This initiative will be focused on four primary areas:the following initiatives: global supply chain optimization; global marketing and innovation effectiveness; operating expense leverage and operational excellence; and data and information technology systems standardization. The second componentstandardization; and the integration of our productivity and reinvestment program relates to additional integration initiatives in North America as a result of our acquisition of CCE'sCoca-Cola Enterprises Inc.'s ("Old CCE") former North America business. The Company has identified incremental synergies, primarily in the area of our North American product supply operations, which will better

5254



enable us to service our customers and consumers. We believe these efforts will create annualized productivity of $200 million to $250 million.
As a combined productivity and reinvestment program, the Company anticipates generating annualized productivity of $550 million to $650 million, which will be reinvested in brand-building initiatives.
In February 2014, the Company announced that we are expandingthe expansion of our productivity and reinvestment program to drive an incremental $1 billion in productivity by 2016 that will primarily be redirected into increased media investments. Our incremental productivity goal consists of two relatively equal components. First, expandedwe will expand savings through global supply chain optimization, data and information technology system standardization, and resource and cost reallocation, which will be reinvested in global brand-building initiatives, with an emphasis on increased media spending.reallocation. Second, we will be increasingincrease the effectiveness of our marketing investments by transforming our marketing and commercial model to redeploy resources into more consumer-facing marketing investments to accelerate growth.
In October 2014, the Company announced that we are further expanding our productivity and reinvestment program and extending it through 2019. The expansion of the productivity initiatives will focus on four key areas: restructuring the Company's global supply chain, including manufacturing in North America; implementing zero-based budgetingwork, an evolution of zero-based budget principles, across the organization; streamlining and simplifying the Company's operating model; and further driving increased discipline and efficiency in direct marketing investments. The Company expects that the expanded productivity initiatives will generate an incremental $2 billion in annualized productivity. This productivity will enable the Company to fund marketing initiatives and innovation required to deliver sustainable net revenue growth and will also support margin expansion and increased returns on invested capital over time. Refer to Note 18 of Notes to Consolidated Financial Statements.
We expect to achieve total annualized productivity of approximately $3.6 billion by 2019 from the initiatives implemented under this program since it began in 2012.
We have incurred total pretax expenses of $2,056 million since the initiative commenced in 2012. Refer to Note 18 of Notes to Consolidated Financial Statements for additional information.
Integration of Our German Bottling and Distribution Operations
In 2008, the Company began the integration of 18our German bottling and distribution operations acquired in 2007. Since the integration commenced, the Company has incurred total pretax expenses of $835$1,127 million primarily related to involuntary terminations. The Company isWe are currently reviewing otheradditional restructuring opportunities within the German bottling and distribution operations, which if implemented will result in additional charges in future periods. However, as of December 31, 2014, the Company had not finalized any additional restructuring plans. The Company does anticipate incurring additionalincluding integration costs related to information technology and other initiatives. If implemented, these initiatives will result in additional charges in future periods. Our German bottling operations are now classified as held for sale. Refer to Note 18 of Notes to Consolidated Financial Statements.
Operating Income and Operating Margin
Information about our operating income contribution by operating segment on a percentage basis is as follows:
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
Eurasia & Africa11.2% 10.6% 10.0%11.3% 11.2% 10.6%
Europe29.4
 28.0
 27.5
33.1
 29.4
 28.0
Latin America23.8
 28.4
 26.7
24.9
 23.8
 28.4
North America25.2
 23.8
 24.1
28.5
 25.2
 23.8
Asia Pacific25.2
 24.2
 23.3
25.1
 25.2
 24.2
Bottling Investments0.1
 1.1
 1.3

 0.1
 1.1
Corporate(14.9) (16.1) (12.9)(22.9) (14.9) (16.1)
Total100.0% 100.0% 100.0%100.0% 100.0% 100.0%

53



Information about our operating margin on a consolidated basis and by operating segment is as follows:
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
Consolidated21.1% 21.8% 22.4%19.7% 21.1% 21.8%
Eurasia & Africa39.7% 39.3% 40.0%40.7% 39.7% 39.3%
Europe58.9
 61.5
 66.1
63.6
 58.9
 61.5
Latin America50.4
 61.3
 63.1
54.3
 50.4
 61.3
North America11.4
 11.3
 12.0
11.4
 11.4
 11.3
Asia Pacific46.6
 46.1
 44.3
46.5
 46.6
 46.1
Bottling Investments0.1
 1.5
 1.6

 0.1
 1.5
Corporate*
 *
 *
*
 *
 *
*Calculation is not meaningful.

55



Year Ended December 31, 2015 versus Year Ended December 31, 2014
In 2015, foreign currency exchange rate fluctuations unfavorably impacted consolidated operating income by 12 percent. This unfavorable impact was primarily due to a stronger U.S. dollar compared to certain foreign currencies, including the South African rand, euro, U.K. pound sterling, Brazilian real, Mexican peso, Australian dollar and Japanese yen, which had an unfavorable impact on our Eurasia and Africa, Europe, Latin America, Asia Pacific and Bottling Investments operating segments. Refer to the heading "Liquidity, Capital Resources and Financial Position — Foreign Exchange" below.
During the year ended December 31, 2015, the Company's operating income was unfavorably impacted by the refranchising of additional territories in North America and the sale of the Company's energy brands as part of the Monster Transaction. The refranchising activities unfavorably impacted our North America operating segment and the sale of the energy brands unfavorably impacted our Eurasia and Africa, Europe, Latin America, North America and Asia Pacific operating segments. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information.
Operating income for Eurasia and Africa for the years ended December 31, 2015 and 2014 was $987 million and $1,084 million, respectively. The segment was unfavorably impacted by fluctuations in foreign currency exchange rates of 16 percent, partially offset by favorable pricing across most of the segment's business units.
Operating income for Europe for the years ended December 31, 2015 and 2014 was $2,888 million and $2,852 million, respectively. The Europe group was favorably impacted by a reduction in other operating charges primarily related to the Company's productivity and reinvestment program. The favorable impact of the reduction in other operating charges was partially offset by the unfavorable impact of foreign currency exchange rate fluctuations of 3 percent.
Operating income for the Latin America segment for the years ended December 31, 2015 and 2014 was $2,169 million and $2,316 million, respectively. Foreign currency exchange rate fluctuations unfavorably impacted operating income by 31 percent, partially offset by the reduction in other operating charges and favorable price mix in all of the segment's business units.
North America's operating income for the years ended December 31, 2015 and 2014 was $2,490 million and $2,447 million, respectively. The segment was favorably impacted by price increases and product and package mix, partially offset by an increase in other operating charges.
Operating income in Asia Pacific for the years ended December 31, 2015 and 2014 was $2,189 million and $2,448 million, respectively. Operating income for the segment reflects the unfavorable impact of foreign currency exchange rate fluctuations of 8 percent.
Our Bottling Investments segment's operating income for the years ended December 31, 2015 and 2014 was zero and $9 million, respectively. The Bottling Investments segment was unfavorably impacted by an increase in other operating charges partially offset by the favorable impact of acquisitions and divestitures. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information related to acquisitions and divestitures.
The Corporate segment's operating loss for the years ended December 31, 2015 and 2014 was $1,995 million and $1,448 million, respectively. Operating loss in 2015 was unfavorably impacted by an impairment charge of $418 million primarily related to the discontinuation of the energy products in the glacéau portfolio as a result of the Monster Transaction, a charge of $100 million due to a cash contribution we made to The Coca-Cola Foundation and a $111 million charge due to an impairment of a Venezuelan trademark and a write-down the Company recorded on receivables from our bottling partner in Venezuela.

56



Year Ended December 31, 2014 versus Year Ended December 31, 2013
In 2014, foreign currency exchange ratesrate fluctuations unfavorably impacted consolidated operating income by 6 percent. The unfavorable impact of changes in foreign currency exchange rates was primarily due to a stronger U.S. dollar compared to certain other foreign currencies, including the South African rand, Mexican peso, Brazilian real, Australian dollar and Japanese yen, which had an unfavorable impact on our Eurasia and Africa, Latin America, Asia Pacific and Bottling Investments operating segments. The unfavorable impact of a stronger U.S. dollar compared to the currencies listed above was partially offset by the impact of a weaker U.S. dollar compared to certain other foreign currencies, including the euro and British pound, which had a favorable impact on our Europe and Bottling Investments operating segments. Refer to the heading "Liquidity, Capital Resources and Financial Position — Foreign Exchange" below.
Operating income for Eurasia and Africa for the years ended December 31, 2014 and 2013 was $1,084 million and $1,087 million, respectively. The segment was unfavorably impacted by fluctuations in foreign currency exchange rates of 12 percent. The unfavorable impact of the foreign currency exchange rates was offset by favorable pricing across many of the segment's markets.
OperatingEurope’s operating income for Europe for the years ended December 31, 2014 and 2013 was $2,852 million and $2,859 million, respectively. The Europe group was favorably impacted by foreign currency exchange rate fluctuations of 2 percent. The favorable impact of the foreign currency exchange rate fluctuations was offset by lower concentrate sales volume and increased charges related to the Company’s productivity and reinvestment program.
Operating income for thein Latin America segment for the years ended December 31, 2014 and 2013 was $2,316 million and $2,908 million, respectively. Foreign currency exchange rate fluctuations and the Venezuelan Fair Price Law unfavorably impacted operating income by 12 percent and 9 percent, respectively. Operating income was also unfavorably impacted by the write-down of concentrate sales receivables from our local bottling partner in Venezuela. Refer to Note 1 of Notes to Consolidated Financial Statements for additional information on the write-down of receivables. The impact of these items was partially offset by favorable price mix in all of the segment's business units.
North America's operating income for the years ended December 31, 2014 and 2013 was $2,447 million and $2,432 million, respectively. The segment was favorably impacted by positive price mix and lower commodity costs, partially offset by increased marketing investments.
Operating income in Asia Pacific for the years ended December 31, 2014 and 2013 was $2,448 million and $2,478 million, respectively. Operating income was favorably impacted by a 5 percent increase in concentrate sales and a reduction in operating expenses, offset by the unfavorable impact of foreign currency exchange rate fluctuations of 8 percent.
Our Bottling Investments segment's operating income for the years ended December 31, 2014 and 2013 was $9 million and $115 million, respectively. The primary reason for the decrease in operating income was the deconsolidation of the Company's Brazilian bottling operations in July 2013 and increased restructuring expenses incurred by our German bottling operations. In addition, fluctuations in foreign currency unfavorably impacted the segment's 2014 operating income by 4 percent.

54



The Corporate segment's operating loss for the years ended December 31, 2014 and 2013 was $1,448 million and $1,651 million, respectively. Operating loss in 2013 was unfavorably impacted by a $195 million charge due to the impairment of certain intangible assets.
Year Ended December 31, 2013 versus Year Ended December 31, 2012
In 2013, foreign currency exchange rates unfavorably impacted consolidated operating income by 4 percent. The unfavorable impact of changes in foreign currency exchange rates was primarily due to a stronger U.S. dollar compared to certain other foreign currencies, including the South African rand, British pound, Brazilian real, Australian dollar and Japanese yen, which impacted the Eurasia and Africa, Europe, Latin America, Asia Pacific and Bottling Investments operating segments. The unfavorable impact of a stronger U.S. dollar compared to the currencies listed above was partially offset by the impact of a weaker U.S. dollar compared to certain other foreign currencies, including the euro and Mexican peso, which had a favorable impact on our Europe, Latin America and Bottling Investments operating segments. Refer to the heading "Liquidity, Capital Resources and Financial Position — Foreign Exchange" below.
Operating income for Eurasia and Africa for the years ended December 31, 2013 and 2012 was $1,087 million and $1,078 million, respectively. In 2013, operating income was unfavorably impacted by fluctuations in foreign currency exchange rates by 8 percent. The segment’s operating income was also favorably impacted by volume and revenue growth during 2013, partially offset by continued investments in our brands and increased operating expenses.
Europe’s operating income for the years ended December 31, 2013 and 2012 was $2,859 million and $2,960 million, respectively. In 2013, operating income was minimally impacted by fluctuations in foreign currency exchange rates. Operating margin was unfavorably impacted by higher cost of goods sold and higher operating expenses due to the consolidation of the innocent branded juice and smoothie business. Generally, bottling and finished product operations have higher net operating revenues but lower operating margins when compared to concentrate and syrup operations. During 2013, operating income was reduced by $57 million due to charges related to the Company’s productivity and reinvestment program.
Operating income in Latin America for the years ended December 31, 2013 and 2012 was $2,908 million and $2,879 million, respectively. In 2013, operating income was unfavorably impacted by fluctuations in foreign currency exchange rates by 10 percent. Operating income for the segment was also impacted by favorable pricing across all of the business units and volume growth in the Latin Center and South Latin business units, partially offset by continued investments in the brands, including investments related to the 2014 FIFA World CupTM.
North America's operating income for the years ended December 31, 2013 and 2012 was $2,432 million and $2,597 million, respectively. In both 2013 and 2012, operating income was minimally impacted by fluctuations in foreign currency exchange rates. The decrease in operating income and operating margin was primarily due to unfavorable product and package mix. North America’s operating income was also reduced by $282 million due to charges related to the Company’s productivity and reinvestment program, as compared to $227 million of similar charges in 2012.
Operating income in Asia Pacific for the years ended December 31, 2013 and 2012 was $2,478 million and $2,516 million, respectively. In 2013, the segment's operating income was unfavorably impacted by fluctuations in foreign currency exchange rates by 2 percent and charges of $25 million related to the Company’s productivity and reinvestment program as well as other restructuring initiatives, as compared to $2 million of similar charges in 2012.
Our Bottling Investments segment's operating income for the years ended December 31, 2013 and 2012 was $115 million and $140 million, respectively. In 2013, operating income was unfavorably impacted by fluctuations in foreign currency exchange rates by 8 percent. Operating income was also reduced due to the deconsolidation of our Philippine and Brazilian bottling operations. Refer to Note 2 of Notes to Consolidated Financial Statements. In addition, operating income in 2013 was reduced by $194 million due to charges related to the Company’s productivity and reinvestment program as well as other restructuring initiatives, as compared to $164 million of related charges in 2012.
The Corporate segment's operating loss for the years ended December 31, 2013 and 2012 was $1,651 million and $1,391 million, respectively. Operating loss in 2013 included impairment charges of $195 million recorded on certain of the Company’s intangible assets. Operating loss also included charges of $120 million related to the Company’s productivity and reinvestment program as well as other restructuring initiatives, as compared to similar charges of $33 million in 2012. Operating loss in 2013 was favorably impacted by fluctuations in foreign currency exchange rates by 2 percent.

5557



Interest Income
Year EndedDecember 31, 2015 versus Year EndedDecember 31, 2014
Interest income was $613 million in 2015, compared to $594 million in 2014, an increase of $19 million, or 3 percent. The increase primarily reflects higher average cash and investment balances and higher average interest rates in certain of our international locations, partially offset by the unfavorable impact of fluctuations in foreign currency exchange rates due to a stronger U.S. dollar against most major currencies.
Year Ended December 31, 2014 versus Year Ended December 31, 2013
Interest income was $594 million in 2014, compared to $534 million in 2013, an increase of $60 million, or 11 percent. The increase primarily reflects higher cash balances and higher average interest rates in certain of our international locations, partially offset by the unfavorable impact of fluctuations in foreign currency exchange rates due to a stronger U.S. dollar against most major currencies.
Interest Expense
Year Ended December 31, 20132015 versus Year Ended December 31, 20122014
Interest incomeexpense was $534856 million in 20132015, compared to $471483 million in 20122014, an increase of $63$373 million, or 1377 percent. The increase is primarily reflects higher cashdue to charges of $320 million the Company recorded on the early extinguishment of certain long-term debt. These charges included the difference between the reacquisition price and the net carrying amount of the debt extinguished, including the impact of the related fair value hedging relationship. Interest expense also increased as a result of an overall increase in the total debt balances and an increased return on investmentsa shift in certainthe mix of our international locations as well asdebt portfolio from short-term to long-term debt. During the year ended December 31, 2015, the Company issued SFr1,325 million, €8,500 million and $4,000 million of long-term debt. Refer to Note 5 of Notes to Consolidated Financial Statements for additional investments in debt securities and money market funds in connection withinformation related to the Company's overall cash management strategy.hedging program. Refer to the heading "Liquidity, Capital Resources and Financial Position — Cash Flows from Financing Activities — Debt Financing" below and Note 10 of Notes to Consolidated Financial Statements for additional information related to the Company's long-term debt.
Interest Expense
Year Ended December 31, 2014 versus Year Ended December 31, 2013
Interest expense was $483 million in 2014, compared to $463 million in 2013, an increase of $20 million, or 4 percent. The increase primarily reflects the impact of additional long-term debt the Company issued during late 2013 and 2014 as well as the unfavorable impact of interest rate swaps. In addition, interest expense in 2013 included charges related to the Company's early extinguishment of long-term debt. Refer to Note 5 of Notes to Consolidated Financial Statements for additional information related to the Company's hedging program. Refer to the heading "Liquidity, Capital Resources and Financial Position — Cash Flows from Financing Activities — Debt Financing" below for additional information related to the Company's long-term debt.
Year EndedDecember 31, 2013 versus Year EndedDecember 31, 2012
Interest expense was $463 million in 2013, compared to $397 million in 2012, an increase of $66 million, or 17 percent. This increase is primarily due to charges of $53 million the Company recorded on the early extinguishment of certain long-term debt, as well as an overall higher average long-term debt balance in 2013. These charges include both the difference between the reacquisition price and the net carrying amount of the debt extinguished as well as hedge accounting adjustments reclassified from accumulated other comprehensive income to earnings. These increases were partially offset by the favorable impact of interest rate swaps. Refer to Note 5 of Notes to Consolidated Financial Statements for additional information related to the Company's hedging program. Refer to the heading "Liquidity, Capital Resources and Financial Position — Cash Flows from Financing Activities — Debt Financing" below for additional information related to the Company's long-term debt.
Equity Income (Loss) — Net
Year Ended December 31, 20142015 versus Year Ended December 31, 20132014
Equity income (loss) — net represents our Company's proportionate share of net income or loss from each of our equity method investees. In 2014,2015, equity income was $769$489 million, compared to equity income of $602$769 million in 2014, a decrease of $280 million, or 36 percent. This decrease reflects, among other items, the unfavorable impact of the challenging economic conditions around the world where many of our equity method investees operate and fluctuations in foreign currency exchange rates due to a stronger U.S. dollar against most major currencies. The impact of these items was partially offset by the impact of acquisitions of equity investees. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information.
Year EndedDecember 31, 2014 versus Year EndedDecember 31, 2013
In 2014, equity income was $769 million, compared to equity income of $602 million in 2013, an increase of $167 million, or 28 percent. This increase was primarily due to more favorable operating results reported by several of our equity method investees, a decrease in the impact of unusual or infrequent charges recorded by certain of our equity method investees, and the deconsolidation of our Brazilian bottling operations during 2013, which is now an equity method investee. This increase was partially offset by the unfavorable impact of foreign currency fluctuations.
Year EndedDecember 31, 2013 versus Year EndedDecember 31, 2012
In 2013, equity income was $602 million, compared to equity income of $819 million in 2012, a decrease of $217 million, or 27 percent. This decrease reflects, among other items, the unfavorable impact of the challenging economic conditions around the world where many of our equity method investees operate, the impact of unusual or infrequent charges recorded by certain of our equity method investees and fluctuations in foreign currency exchange rates due to a stronger U.S. dollar against most major currencies. Equity income (loss) — net was also impacted by the consolidation of innocent, previously an equity method investee, and the deconsolidation of our Philippine and Brazilian bottling operations, which are now equity method investees. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information about these transactions.

5658



Other Income (Loss) — Net
Other income (loss) — net includes, among other things, the impact of foreign currency exchange gains and losses; dividend income; rental income; gains and losses related to the disposal of property, plant and equipment; gains and losses related to business combinations and disposals; realized and unrealized gains and losses on trading securities; realized gains and losses on available-for-sale securities; other-than-temporary impairments of available-for-sale securities; and the accretion of expense related to certain acquisitions. The foreign currency exchange gains and losses are primarily the result of the remeasurement of monetary assets and liabilities from certain currencies into functional currencies. The effects of the remeasurement of these assets and liabilities are partially offset by the impact of our economic hedging program for certain exposures on our consolidated balance sheets. Refer to Note 5 of Notes to Consolidated Financial Statements.
In 2015, other income (loss) — net was income of $631 million. This income included a net gain of $1,403 million as a result the Monster Transaction, primarily due to the difference in the recorded carrying value of the assets transferred, including an allocated portion of goodwill, compared to the value of the total assets and business acquired. Other income (loss) — net also included net foreign currency exchange gains of $149 million and dividend income of $83 million. This income was partially offset by noncash losses of $1,006 million due to refranchising activities in North America. The net foreign currency exchange gains included a gain of $300 million associated with our foreign-denominated debt partially offset by a charge of $27 million due to the initial remeasurement of the net monetary assets of our Venezuelan subsidiary using the SIMADI exchange rate. The Company determined that based on its economic circumstances, the SIMADI rate best represented the applicable rate at which future transactions could be settled, including the payment of dividends. As such, the Company remeasured the net assets related to its operations in Venezuela using the current SIMADI rate. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information on the Monster Transaction and North America refranchising. Refer to the heading "Liquidity, Capital Resources and Financial Position — Foreign Exchange" below and Note 1 of Notes to Consolidated Financial Statements for additional information on the charge due to the change in Venezuelan exchange rates.
In 2014, other income (loss) — net was a loss of $1,263 million, primarily due to chargesnoncash losses of $799 million related to the refranchising of certain territories in North America and foreign exchange losses of $569 million, including a charge of $372 million due to the remeasurement of the net monetary assets of our Venezuelan subsidiary using the SICAD 2 exchange rate. These charges were partially offset by dividend income of $51 million and net gains of $45 million related to fluctuations in the carrying value of the Company's trading securities and sales of available-for-sale securities. Refer to Note 1, Note 2 and Note 17 of Notes to Consolidated Financial Statements.
In 2013, other income (loss) — net was income of $576$576 million,, primarily related to a gain of $615 million due to the deconsolidation of our Brazilian bottling operations as a result of their combination with an independent bottling partner; a gain of $139 million as a result of Coca-Cola FEMSA, an equity method investee, issuing additional shares of its own stock at per share amounts greater than the carrying value of the Company's per share investment; and dividend income of $70 million. The favorable impact of these items was partially offset by a charge of $140 million due to the devaluation of the Venezuelan bolivar, which resulted in the Company remeasuring the net assets related to its operations in Venezuela, and a net charge of $114 million related to our investment in four bottling partners that merged during 2013 to form CCEJ through a share exchange. Refer to Note 2 and Note 17 of Notes to Consolidated Financial Statements.
In 2012, other income (loss) — net was income of $137 million, primarily related to a gain of $185 million due to the merger of Embotelladora Andina S.A. ("Andina") and Embotelladoras Coca-Cola Polar S.A. ("Polar"); a gain of $92 million the Company recognized as a result of Coca-Cola FEMSA issuing additional shares of its own stock at per share amounts greater than the carrying value of the Company's per share investment; dividend income of $44 million; and net gains of $31 million related to fluctuations in the fair value of the Company's trading securities and the sale of available-for-sale securities. The favorable impact of the previous items was partially offset by a charge of $108 million due to the loss we recognized on the then pending sale of a majority ownership interest in our consolidated Philippine bottling operations to Coca-Cola FEMSA; a charge of $82 million related to the premium we paid in excess of the publicly traded market price to acquire an ownership interest in Mikuni Coca-Cola Bottling Co., Ltd. ("Mikuni"); and charges of $16 million due to other-than-temporary declines in the fair values of certain cost method investments. Refer to Note 2 and Note 17 of Notes to Consolidated Financial Statements.
Income Taxes
Our effective tax rate reflects the tax benefits of having significant operations outside the United States, which are generally taxed at rates lower than the U.S. statutory rate of 3535.0 percent. As a result of employment actions and capital investments made by the Company, certain tax jurisdictions provide income tax incentive grants, including Brazil, Costa Rica, Singapore and Swaziland. The terms of these grants expire from 2016 to 2023. We anticipate that we will be able to extend or renew the grants in these locations. Tax incentive grants favorably impacted our income tax expense by $265223 million, $279265 million and $280279 million for the years ended December 31, 20142015, 20132014 and 20122013, respectively. In addition, our effective tax rate reflects the benefits of having significant earnings generated in investments accounted for under the equity method of accounting, which are generally taxed at rates lower than the U.S. statutory rate.

5759



A reconciliation of the statutory U.S. federal tax rate and our effective tax rate is as follows:
Year Ended December 31,2014
 2013
 2012
 2015
 2014
 2013
 
Statutory U.S. federal tax rate35.0 % 35.0 % 35.0 % 35.0 % 35.0 % 35.0 % 
State and local income taxes — net of federal benefit1.0
 1.0
 1.1
 1.2
 1.0
 1.0
 
Earnings in jurisdictions taxed at rates different from the statutory U.S. federal rate(11.5)
1,2 
(10.3)
5,6,7 
(9.5)
10,11 
Reversal of valuation allowances
 
 (2.4)
12 
Earnings in jurisdictions taxed at rates different from the statutory U.S. federal tax rate(12.7)
1 
(11.5)
6,7 
(10.3)
10,11,12 
Equity income or loss(2.2) (1.4)
8 
(2.0) (1.7)
2 
(2.2) (1.4)
13 
Other operating charges2.9
3,4 
1.2
9 
0.4
13 
1.2
3,4 
2.9
8,9 
1.2
14 
Other — net(1.6) (0.7) 0.5
 0.3
5 
(1.6) (0.7) 
Effective tax rate23.6 % 24.8 % 23.1 % 23.3 % 23.6 % 24.8 % 
1 
Includes a pretax charge of $27 million (or a 0.1 percent impact on our effective tax rate) due to the remeasurement of the net monetary assets of our local Venezuelan subsidiary into U.S. dollars using the SIMADI exchange rate. Refer to Note 1 and Note 17 of Notes to Consolidated Financial Statements.
2
Includes a tax benefit of $5 million on a pretax charge of $87 million (or a 0.3 percent impact on our effective tax rate) related to our proportionate share of unusual or infrequent items recorded by our equity method investees. Refer to Note 17 of Notes to Consolidated Financial Statements.
3
Includes a tax benefit of $45 million on a pretax charge of $225 million (or a 0.3 percent impact on our effective tax rate) primarily due to an impairment of a Venezuelan trademark, a write-down of receivables from our bottling partner in Venezuela, a cash contribution to The Coca-Cola Foundation and charges associated with ongoing tax litigation. Refer to Note 1 and Note 17 of Notes to Consolidated Financial Statements.
4
Includes a tax benefit of $259 million on pretax charges of $983 million (or a 0.9 percent impact on our effective tax rate) primarily related to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 18 of Notes to Consolidated Financial Statements.
5
Includes tax expense of $150 million on pretax income of $77 million (or a 1.3 percent impact on our effective rate) primarily due to the gain related to the Monster Transaction, offset by charges related to the refranchising of certain territories in North America and charges associated with the early extinguishment of long-term debt. Refer to Note 2 and Note 17 of Notes to Consolidated Financial Statements.
6
Includes tax expense of $6 million tax expense on a pretax net charge of $372 million (or a 1.5 percent impact on our effective tax rate) due to the remeasurement of the net monetary assets of our local Venezuelan subsidiary into U.S. dollars using the SICAD 2 exchange rate. Refer to Note 1 of Notes to Consolidated Financial Statements.
27 
Includes a tax expense of $18 million (or a 0.2 percent impact on our effective tax rate) related to amounts required to be recorded for changes to our uncertain tax positions, including interest and penalties, in various international jurisdictions.
38 
Includes a tax expense of $55 million on a pretax charge of $352 million (or a 1.9 percent impact on our effective tax rate) primarily due to an impairment of a Venezuelan trademark, a write-down the Company recorded on the concentrate sales receivables from our bottling partner in Venezuela, a charge associated with certain of the Company's fixed assets, and as a result of the restructuring and transition of the Company's Russian juice operations to an existing joint venture with an unconsolidated bottling partner. Refer to Note 1 and Note 17 of Notes to Consolidated Financial Statements.
49 
Includes a tax benefit of $191 million on pretax charges of $809 million (or a 1 percent impact on our effective tax rate) primarily related to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 18 of Notes to Consolidated Financial Statements.
510 
Includes a tax benefit of $26 million (or a 0.2 percent impact on our effective tax rate) related to amounts required to be recorded for changes to our uncertain tax positions, including interest and penalties, in various international jurisdictions.
611 
Includes a tax expense of $279 million on pretax net gains of $501 million (or a 0.9 percent impact on our effective tax rate) related to the deconsolidation of our Brazilian bottling operations upon their combination with an independent bottler and a loss due to the merger of four of the Company's Japanese bottling partners. Refer to Note 2 and Note 17 of Notes to Consolidated Financial Statements.
712 
Includes a tax expense of $3 million (or a 0.5 percent impact on our effective tax rate) related to a charge of $149 million due to the devaluation of the Venezuelan bolivar. Refer to Note 19 of Notes to Consolidated Financial Statements.
813 
Includes ana tax benefit of $8 million tax benefit on a pretax charge of $159 million (or a 0.4 percent impact on our effective tax rate) related to our proportionate share of unusual or infrequent items recorded by our equity method investees. Refer to Note 17 of Notes to Consolidated Financial Statements.
914 
Includes a tax benefit of $175 million on pretax charges of $877 million (or a 1.2 percent impact on our effective tax rate) primarily related to impairment charges recorded on certain of the Company's intangible assets and charges related to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 17 and Note 18 of Notes to Consolidated Financial Statements.
10
Includes a tax expense of $133 million (or a 1.1 percent impact on our effective tax rate) related to amounts required to be recorded for changes to our uncertain tax positions, including interest and penalties, in various international jurisdictions.
11
Includes a tax expense of $57 million on pretax net gains of $76 million (or a 0.3 percent impact on our effective tax rate) related to the following: a gain recognized as a result of the merger of Andina and Polar; a gain recognized as a result of Coca-Cola FEMSA, an equity method investee, issuing additional shares of its own stock at a per share amount greater than the carrying value of the Company's per share investment; the loss recognized on the then pending sale of a majority ownership interest in our consolidated Philippine bottling operations to Coca-Cola FEMSA; and the expense recorded for the premium the Company paid over the publicly traded market price to acquire an ownership interest in Mikuni. Refer to Note 17 of Notes to Consolidated Financial Statements.
12
Relates to a net tax benefit of $283 million associated with the reversal of valuation allowances in certain of the Company's foreign jurisdictions.
13
Includes a tax benefit of $95 million on pretax charges of $416 million (or a 0.4 percent impact on our effective tax rate) primarily related to the Company's productivity and reinvestment program as well as other restructuring initiatives; the refinement of previously established accruals related to the Company's 2008–2011 productivity initiatives; and the refinement of previously established accruals related to the Company's integration of CCE's former North America business. Refer to Note 18 of Notes to Consolidated Financial Statements.

5860



As of December 31, 2014,2015, the gross amount of unrecognized tax benefits was $211 million.$168 million. If the Company were to prevail on all uncertain tax positions, the net effect would be a benefit to the Company's effective tax rate of $173$148 million,, exclusive of any benefits related to interest and penalties. The remaining $38$20 million,, which was recorded as a deferred tax asset, primarily represents tax benefits that would be received in different tax jurisdictions in the event the Company did not prevail on all uncertain tax positions.
A reconciliation of the changes in the gross balanceamount of unrecognized tax benefit amountsbenefits is as follows (in millions):
Year Ended December 31,2014
 2013
 2012
Beginning balance of unrecognized tax benefits$230
 $302
 $320
Increases related to prior period tax positions13
 1
 69
Decreases related to prior period tax positions(2) (7) (15)
Increases related to current period tax positions11
 8
 23
Decreases related to settlements with taxing authorities(5) (4) (45)
Reductions as a result of a lapse of the applicable statute of limitations(32) (59) (36)
Increases (decreases) from effects of foreign currency exchange rates(4) (11) (14)
Ending balance of unrecognized tax benefits$211
 $230
 $302
Year Ended December 31,2015
 2014
 2013
Beginning balance of unrecognized tax benefits$211
 $230
 $302
Increase related to prior period tax positions4
 13
 1
Decrease related to prior period tax positions(9) (2) (7)
Increase related to current period tax positions5
 11
 8
Decrease related to settlements with taxing authorities(5) (5) (4)
Decrease due to lapse of the applicable statute of limitations(23) (32) (59)
Increase (decrease) due to effect of foreign currency exchange rate changes(15) (4) (11)
Ending balance of unrecognized tax benefits$168
 $211
 $230
The Company recognizes accrued interest and penalties related to unrecognized tax benefits in income tax expense. The Company had $113$111 million,, $105 $113 million and $113$105 million in interest and penalties related to unrecognized tax benefits accrued as of December 31, 20142015, , 20132014 and 20122013, respectively. Of these amounts, $8$8 million of expense $8and $8 million of benefit and $33 million of expense were recognized through income tax expense in 2014, and 2013, respectively. For the year ended December 31, 2015, an insignificant amount of interest and 2012, respectively.penalties were recognized through income tax expense. If the Company were to prevail on all uncertain tax positions, the reversal of this accrual would also be a benefit to the Company's effective tax rate.
Based on current tax laws, the Company's effective tax rate in 20152016 is expected to be approximately 22.5 percent before considering the effect of any unusual or special items that may affect our tax rate.
Liquidity, Capital Resources and Financial Position
We believe our ability to generate cash flows from operating activities is one of our fundamental financial strengths. Refer to the heading "Cash Flows from Operating Activities" below. The near-term outlook for our business remains strong, and we expect to generate substantial cash flows from operations in 2015.2016. As a result of our expected cash flows from operations, we have significant flexibility to meet our financial commitments. The Company does not typically raise capital through the issuance of stock. Instead, we use debt financing to lower our overall cost of capital and increase our return on shareowners' equity. Refer to the heading "Cash Flows from Financing Activities" below. We have a history of borrowing funds domestically and continue to have the ability to borrow funds domestically at reasonable interest rates. In addition, our domestic entities have recently borrowed and continue to have the ability to borrow funds in international markets at reasonable interest rates. Our debt financing includes the use of an extensive commercial paper program as part of our overall cash management strategy. The Company reviews its optimal mix of short-term and long-term debt regularly and may replace certain amounts of commercial paper, short-term debt and current maturities of long-term debt with new issuances of long-term debt in the future. In addition to the Company's cash balances, commercial paper program, and our ability to issue long-term debt, we also had $7,6778,340 million in lines of credit for general corporate purposes as of December 31, 20142015. These backup lines of credit expire at various times from 20152016 through 2019.2019.
We have significant operations outside the United States. Unit case volume outside the United States represented 81 percent of the Company's worldwide unit case volume in 2014.2015. We earn a substantial amount of our consolidated operating income and income before income taxes in foreign subsidiaries that either sell concentrate to our local bottling partners or, in certain instances, sell finished products directly to our customers to fulfill the demand for Company beverage products outside the United States. A significant portion of these foreign earnings is considered to be indefinitely reinvested in foreign jurisdictions where the Company has made, and will continue to make, substantial investments to support the ongoing development and growth of our international operations. Accordingly, no U.S. federal and state income taxes have been provided on the portion of our foreign earnings that is considered to be indefinitely reinvested in foreign jurisdictions. The Company's cash, cash equivalents, short-term investments and marketable securities held by our foreign subsidiaries totaled $19.5$17.9 billion as of December 31, 2014.2015. With the exception of an insignificant amount, for which U.S. federal and state income taxes have already been provided, we do not intend, nor do we foresee a need, to repatriate these funds. Additionally, the absence of a government-approved mechanism to convert local currency into U.S. dollars in Argentina and Venezuela currently restricts the Company's ability to pay dividends from these locations. The Company has begun to invest cash locally in Argentina and will continue to look for additional investing opportunities in this market as well as Venezuela. As of December 31, 2014, the Company's subsidiaries in Argentina and Venezuela held $230 million and $52 million, respectively, of cash, cash equivalents, short-term investments and marketable securities.

5961



Net operating revenues in the United States were $19.8$20.4 billion in 2014,2015, or 4346 percent of the Company's consolidated net operating revenues. We expect existing domestic cash, cash equivalents, short-term investments, marketable securities, cash flows from operations and the issuance of debt to continue to be sufficient to fund our domestic operating activities and cash commitments for investing and financing activities. In addition, we expect existing foreign cash, cash equivalents, short-term investments, marketable securities and cash flows from operations to continue to be sufficient to fund our foreign operating activities and cash commitments for investing activities.
In the future, should we require more capital to fund significant discretionary activities in the United States than is generated by our domestic operations orand is available through the issuance of domestic debt, we could elect to repatriate future periods' earnings from foreign jurisdictions. This alternative could result in a higher effective tax rate.rate in the future. While the likelihood is remote, the Company could also elect to repatriate earnings from foreign jurisdictions that have previously been considered to be indefinitely reinvested. Upon distribution of those earnings in the form of dividends or otherwise, the Company would be subject to additional U.S. income taxes (net of an adjustment for foreign tax credits) and withholding taxes payable to various foreign jurisdictions, where applicable. This alternative could also result in a higher effective tax rate in the period in which such a determination is made to repatriate prior period foreign earnings. Refer to Note 14 of Notes to Consolidated Financial Statements for further information related to our income taxes and undistributed earnings of the Company's foreign subsidiaries.
Based on all the aforementioned factors, the Company believes its current liquidity position is strong, and we will continue to meet all of our financial obligations and other anticipated cash outflowscommitments for the foreseeable future. These obligations and anticipated cash outflows include, but are not limited to, regular quarterly dividends, debt maturities, capital expenditures, share repurchases and obligations included under the heading "Off-Balance Sheet Arrangements and Aggregate Contractual Obligations" below.
Cash Flows from Operating Activities
Net cash provided by operating activities for the years ended December 31, 2015, 2014 and 2013 and 2012 was $10,528 million, $10,615 million and $10,542 million, respectively.
Cash flows from operating activities decreased $87 million, or 1 percent, in 2015 compared to 2014. This decrease primarily reflects the impact of foreign currency fluctuations and $10,645 million, respectively.an increase in tax payments, partially offset by the efficient management of working capital. Refer to the heading "Operations Review — Net Operating Revenues" above for additional information on the impact of foreign currency fluctuations. Refer to Note 14 of Notes to Consolidated Financial Statements for additional information on the tax payments.
Cash flows from operating activities increased $73 million, or 1 percent, in 2014 compared to 2013. This increase primarily reflects the incremental pension contributions that were made in the first quarter of 2013 compared to 2014 as well as efficient management of working capital. The increase was partially offset by an unfavorable impact of currency exchange rates during 2014.
Cash flows from operating activities decreased $103 million, or 1 percent, in 2013 compared to 2012. This decrease primarily reflects the impact of foreign currency fluctuations, an increase in tax payments and the effect of the deconsolidation of our Philippine and Brazilian bottling operations during 2013, partially offset by lower pension funding in 2013 compared to 2012. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information on the deconsolidation of these bottling operations. Refer to the heading "Operations Review — Net Operating Revenues" above for additional information on the impact of foreign currency fluctuations. Refer to Note 13 and Note 14 of Notes to Consolidated Financial Statements for additional information on the pension funding and tax payments.
Cash Flows from Investing Activities
Our cash flows provided by (used in) investing activities are summarized as follows (in millions):
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
Purchases of investments$(17,800) $(14,782) $(14,824)$(15,831) $(17,800) $(14,782)
Proceeds from disposals of investments12,986
 12,791
 7,791
14,079
 12,986
 12,791
Acquisitions of businesses, equity method investments and nonmarketable securities(389) (353) (1,486)(2,491) (389) (353)
Proceeds from disposals of businesses, equity method investments and nonmarketable securities148
 872
 20
565
 148
 872
Purchases of property, plant and equipment(2,406) (2,550) (2,780)(2,553) (2,406) (2,550)
Proceeds from disposals of property, plant and equipment223
 111
 143
85
 223
 111
Other investing activities(268) (303) (268)(40) (268) (303)
Net cash provided by (used in) investing activities$(7,506) $(4,214) $(11,404)$(6,186) $(7,506) $(4,214)

6062



Purchases of Investments and Proceeds from Disposals of Investments
In 2015, purchases of investments were $15,831 million and proceeds from disposals of investments were $14,079 million. This activity resulted in a net cash outflow of $1,752 million during 2015. In 2014, purchases of investments were $17,800 million and proceeds from disposals of investments were $12,986 million. This activity resultedmillion, resulting in a net cash outflow of $4,814 million during 2014.million. In 2013, purchases of investments were $14,782 million and proceeds from disposals of investments were $12,791 million, resulting in a net cash outflow of $1,991 million. In 2012, purchases of investments were $14,824 million and proceeds from disposals of investments were $7,791 million, resulting in a net cash outflow of $7,033 million. These investments include time deposits that have maturities greater than three months but less than one year and are classified in the line item short-term investments in our consolidated balance sheets. The purchases during the yearyears ended December 31, 2015 and 2014 include our investmentinvestments in Keurig Green Mountain, Inc. ("Keurig") of $830 million and $1,567 million, respectively, partially offset by the net purchases and proceeds of our short-term investments that were made as part of the Company's overall cash management strategy. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information on our investment in Keurig. In December 2015, Keurig announced that it had entered into an agreement with JAB Holding Company ("JAB") under which a JAB-led investor group will acquire Keurig for $92 per share in cash. The transaction is expected to close in the first quarter of 2016, subject to customary closing conditions, including receipt of regulatory approvals. Upon the sale of its shares, the Company will receive proceeds of approximately $2,380 million.
Acquisitions of Businesses, Equity Method Investments and Nonmarketable Securities
In 2015, the Company's acquisitions of businesses, equity method investments and nonmarketable securities totaled $2,491 million, which primarily included our equity investments in Monster and in Indonesian bottling operations and the acquisition of a controlling interest in a South African bottling operation.
In 2014, the Company's acquisitions of businesses, equity method investments and nonmarketable securities totaled $389 million, which primarily included a joint investment with one of our bottling partners in a dairy company in Ecuador. None of the Company's other acquisitions or investments was individually significant.
In 2013, theour Company's acquisitions of businesses, equity method investments and nonmarketable securities totaled $353 million. These activities primarily included our acquisition of the majority of the remaining outstanding shares of innocent and a majority interest in bottling operations in Myanmar.
In 2012, our Company's acquisitions of businesses, equity method investments and nonmarketable securities totaled $1,486 million. These activities were primarily related to the following: our investments in the existing beverage business of Aujan, one of the largest independent beverage companies in the Middle East; our investment in Mikuni, a bottling partner located in Japan; our acquisition of Sacramento Coca-Cola Bottling Co., Inc. ("Sacramento bottler"); and our acquisition of bottling operations in Vietnam, Cambodia and Guatemala. None of the Company's other acquisitions or investments was individually significant.
Refer to the heading "Operations Review — Structural Changes, Acquired Brands and Newly Licensed Brands" and Note 2 of Notes to Consolidated Financial Statements for additional information related to our acquisitions during the years ended December 31, 2015, 2014 2013 and 2012.2013.
Proceeds from Disposals of Businesses, Equity Method Investments and Nonmarketable Securities
In 2015, proceeds from disposals of businesses, equity method investments and nonmarketable securities were $565 million, which included cash received as a result of a Brazilian bottling entity's majority interest owners exercising their option to acquire from us an additional equity interest. The proceeds from disposals of businesses, equity method investments and nonmarketable securities during 2015 also included the proceeds from the sale of the Company's distribution assets, certain working capital items, and the grant of exclusive rights to distribute certain beverage brands not owned by the Company, but distributed by CCR, to certain unconsolidated bottling partners as part of the North America refranchising. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information.
In 2014, proceeds from disposals of businesses, equity method investments and nonmarketable securities were $148 million, which represented the proceeds from the sale of the Company's distribution assets, certain working capital items, and the grant of exclusive rights to distribute certain beverage brands not owned by the Company, but distributed by CCR, to certain unconsolidated bottling partners as part of the North America refranchising. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information.
In 2013, proceeds from disposals of businesses, equity method investments and nonmarketable securities were $872 million. These proceeds primarily related to the sale of a majority ownership interest in our previously consolidated Philippine bottling operations, and separately, the deconsolidation of our Brazilian bottling operations. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information.

61



Property, Plant and Equipment
Purchases of property, plant and equipment net of disposals for the years ended December 31, 2015, 2014 and 2013 and 2012 were $2,468 million, $2,183 million and $2,439 million, and $2,637 million, respectively.

63



Total capital expenditures for property, plant and equipment and the percentage of such totals by operating segment were as follows (in millions):
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
Capital expenditures$2,406
 $2,550
 $2,780
$2,553
 $2,406
 $2,550
Eurasia & Africa1.3% 1.6% 1.8%0.7% 1.3% 1.6%
Europe2.2
 1.3
 1.1
1.4
 2.2
 1.3
Latin America2.3
 2.5
 3.2
2.7
 2.3
 2.5
North America53.7
 53.9
 52.0
52.5
 53.7
 53.9
Asia Pacific3.2
 4.6
 3.9
3.2
 3.2
 4.6
Bottling Investments26.1
 25.2
 31.2
28.8
 26.1
 25.2
Corporate11.2
 10.9
 6.8
10.7
 11.2
 10.9
We expect our annual 20152016 capital expenditures to be $2.5 billion to $3.0 billion as we continue to make investments to enable growth in our business and further enhance our operational effectiveness.
Other Investing Activities
In 2015, cash used in other investing activities included a $530 million payment related to the Monster Transaction, partially offset by the cash flow impact of the Company's derivative contracts designated as net investment hedges. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information on the Monster Transaction and Note 5 of Notes to Consolidated Financial Statements for additional information on the Company's derivative contracts designated as net investment hedges.
In 2014, other investing activities were primarily related to loans to Fairlife, LLC, a value-added dairy joint venture, as well as local investments in Argentina.
In 2013, other investing activities were primarily related to the acquisition of trademarks and certain other intangible assets. None of these investments was individually significant.
In 2012, other investing activities were primarily related to the Company's consolidated Philippine and Brazilian bottling operations being classified as held for sale as of December 31, 2012. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information on these transactions. The cash flow impact of these transactions in other investing activities represents the balance of cash and cash equivalents held by these entities being transferred to assets held for sale.
Cash Flows from Financing Activities
Our cash flows provided by (used in) financing activities were as follows (in millions):
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
Issuances of debt$41,674
 $43,425
 $42,791
$40,434
 $41,674
 $43,425
Payments of debt(36,962) (38,714) (38,573)(37,738) (36,962) (38,714)
Issuances of stock1,532
 1,328
 1,489
1,245
 1,532
 1,328
Purchases of stock for treasury(4,162) (4,832) (4,559)(3,564) (4,162) (4,832)
Dividends(5,350) (4,969) (4,595)(5,741) (5,350) (4,969)
Other financing activities(363) 17
 100
251
 (363) 17
Net cash provided by (used in) financing activities$(3,631) $(3,745) $(3,347)$(5,113) $(3,631) $(3,745)
Debt Financing
Our Company maintains debt levels we consider prudent based on our cash flows, interest coverage ratio and percentage of debt to capital. We use debt financing to lower our overall cost of capital, which increases our return on shareowners' equity. This exposes us to adverse changes in interest rates. Our interest expense may also be affected by our credit ratings.
As of December 31, 2014,2015, our long-term debt was rated "AA" by Standard & Poor's, "Aa3" by Moody's and "A+" by Fitch. Our commercial paper program was rated "A-1+" by Standard & Poor's, "P-1" by Moody's and "F-1""F1" by Fitch. In assessing our credit strength, all three agencies consider our capital structure (including the amount and maturity dates of our debt) and financial policies as well as the aggregated balance sheet and other financial information of the Company. In addition, some rating agencies also consider the financial information of certain bottlers, including New CCE, Coca-Cola Amatil Limited, Coca-Cola Bottling Co. Consolidated, Coca-Cola FEMSA and Coca-Cola Hellenic. While the Company has no legal obligation for the debt of these bottlers, the rating agencies believe the strategic importance of the bottlers to the Company's business

62



model provides the Company with an incentive to keep these bottlers viable. It is our expectation that the credit rating agencies will continue using this methodology. If our credit ratings were to be downgraded as a result of changes in our capital structure,

64



our major bottlers' financial performance, changes in the credit rating agencies' methodology in assessing our credit strength, or for any other reason, our cost of borrowing could increase. Additionally, if certain bottlers' credit ratings were to decline, the Company's equity income could be reduced as a result of the potential increase in interest expense for those bottlers.
In February 2016, Standard & Poor's downgraded the Company's long-term debt rating to AA- with a stable outlook. The Company does not believe that this downgrade will have a material adverse effect on our cost of borrowing.
We monitor our financial ratios and, as indicated above, the rating agencies consider these ratios in assessing our credit ratings. Each rating agency employs a different aggregation methodology and has different thresholds for the various financial ratios. These thresholds are not necessarily permanent, nor are they always fully disclosed to our Company.
Our global presence and strong capital position give us access to key financial markets around the world, enabling us to raise funds at a low effective cost. This posture, coupled with active management of our mix of short-term and long-term debt and our mix of fixed-rate and variable-rate debt, results in a lower overall cost of borrowing. Our debt management policies, in conjunction with our share repurchase programsprogram and investment activity, can result in current liabilities exceeding current assets.
Issuances and payments of debt included both short-term and long-term financing activities. On December 31, 2014, weIn 2015, the Company had $7,677issuances of debt of $40,434 million, which included net issuances of $25,923 million of commercial paper and short-term debt with maturities greater than 90 days. The Company's total issuances of debt also included long-term debt issuances of $14,511 million, net of related discounts, premiums and issuance costs.
During 2015, the Company made payments of $37,738 million, which included net payments of $208 million of commercial paper and short-term debt with maturities of 90 days or less, $31,711 million of payments of commercial paper and short-term debt with maturities greater than 90 days and long-term debt payments of $5,819 million. The long-term debt payments included the extinguishment of $2,039 million of long-term debt prior to maturity, which resulted in linesassociated charges of credit available for general corporate purposes.$320 million that were recorded in the line item interest expense in our consolidated statement of income. These backup linescharges included the difference between the reacquisition price and the net carrying amount of credit expire at various times from 2015 through 2019. There were no borrowings under these backup linesthe debt extinguished, including the impact of credit during 2014. These credit facilities are subject to normal banking terms and conditions.the related fair value hedging relationship.
In 2014, the Company had issuances of debt of $41,674 million, which included net issuances of $317 million of commercial paper and short-term debt with maturities of 90 days or less and $37,799 million of issuances of commercial paper and short-term debt with maturities greater than 90 days. The Company's total issuances of debt also included long-term debt issuances of $3,558 million, net of related discounts and issuance costs.
During 2014, the Company made payments of debt of $36,962 million, which included $35,921 million for payments of commercial paper and short-term debt with maturities greater than 90 days or less and long-term debt payments of $1,041 million.
In 2013, the Company had issuances of debt of $43,425 million, which included $35,944 million of issuances of commercial paper and short-term debt with maturities greater than 90 days. The Company's total issuances of debt also included long-term debt issuances of $7,481 million, net of related discounts and issuance costs.
During 2013, the Company made payments of debt of $38,714 million, which included $70 million of net payments of commercial paper and short-term debt with maturities of 90 days or less, $35,199 million of payments of commercial paper and short-term debt with maturities greater than 90 days and long-term debt payments of $3,445 million. The long-term debt payments included the extinguishment of $2,154 million of long-term debt prior to maturity, which resulted in associated charges of $53 million, including hedge accounting adjustments reclassified from accumulated other comprehensive income, in the line item interest expense in our consolidated statement of income during the year ended December 31, 2013.
In 2012, the Company had issuances of debt of $42,791 million, which included $40,008 million of issuances of commercial paper and short-term debt with maturities greater than 90 days. The Company's total issuances of debt also included long-term debt issuances of $2,783 million, net of related discounts and issuance costs.
During 2012, the Company made payments of debt of $38,573 million. Total payments of debt included $1,553 million of net payments of commercial paper and short-term debt with maturities of 90 days or less, and $35,118 million of payments of commercial paper and short-term debt with maturities greater than 90 days. The Company's total payments of debt also included long-term debt payments of $1,902 million.
The carrying value of the Company's long-term debt included fair value adjustments related to the debt assumed from Old CCE of $464$411 million and $514$464 million as of December 31, 20142015 and 2013,2014, respectively. These fair value adjustments are being amortized over the number of years remaining until the underlying debt matures. As of December 31, 2014,2015, the weighted-average maturity of the assumed debt to which these fair value adjustments relate was approximately 20 years. The amortization of these fair value adjustments will be a reduction of interest expense in future periods, which will typically result in our interest expense being less than the actual interest paid to service the debt. Total interest paid was $498$515 million, $498 million and $574$498 million in 2015, 2014 2013 and 2012,2013, respectively. Refer to Note 10 of Notes to Consolidated Financial Statements for additional information related to the Company's long-term debt balances.

65



Issuances of Stock
The issuances of stock in 2015, 2014 2013 and 20122013 were primarily related to the exercise of stock options by Company employees.

63



Share Repurchases
On July 20, 2006, the Board of Directors of the Company authorized a share repurchase program of up to 600 million shares of the Company's common stock. The program took effect on October 31, 2006. Although there were approximately 43 million shares that were yet to be purchased under this share repurchase program, the Board of Directors authorized a new share repurchase program of up to 500 million shares of the Company's common stock on October 18, 2012 (the "2012("2012 Plan"). The 2012 Plan allowed the Company to continue repurchasing shares following the completion of the prior program. The table below presents annual shares repurchased and average price per share:
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
Number of shares repurchased (in millions)98
 121
 121
86
 98
 121
Average price per share$40.97
 $39.84
 $37.11
$41.33
 $40.97
 $39.84
Since the inception of our initial share repurchase program in 1984 through our current program as of December 31, 2014,2015, we have purchased 3.23.3 billion shares of our Company's common stock at an average price per share of $14.66.$15.36. In addition to shares repurchased under the share repurchase programsprogram authorized by our Board of Directors, the Company's treasury stock activity also includes shares surrendered to the Company to pay the exercise price and/or to satisfy tax withholding obligations in connection with so-called stock swap exercises of employee stock options and/or the vesting of restricted stock issued to employees. In 2014,2015, we repurchased $4.0$3.5 billion of our stock. However, due to the timing of settlements, the total amount of treasury stock purchases that settled during 20142015 was $4.2$3.6 billion, which includes treasury stock that was purchased and settled during 20142015 as well as treasury stock purchased in December 20132014 that settled in early 2014.2015. The net impact of the Company's treasury stock issuance and purchase activities in 20142015 resulted in a net cash outflow of $2.6$2.3 billion. We currently expect to repurchase $2.0 billion to $3.0$2.5 billion of our stock during 2015,2016, net of proceeds from the issuance of treasury stock due to the exercise of employee stock options.
Dividends
The Company paid dividends of $5,741 million, $5,350 million and $4,969 million during the years ended December 31, 2015, 2014 and 2013, respectively.
At its February 20152016 meeting, our Board of Directors increased our quarterly dividend by 86 percent, raising it to $0.33$0.35 per share, equivalent to a full year dividend of $1.32$1.40 per share in 2015.2016. This is our 5354rdth consecutive annual increase. Our annual common stock dividend was $1.32 per share, $1.22 per share and $1.12 per share in 2015, 2014 and $1.02 per share in 2014, 2013, and 2012, respectively. The 2015 dividend represented an 8 percent increase from 2014, and the 2014 dividend represented a 9 percent increase from 2013, and the 2013 dividend represented a 10 percent increase from 2012.2013.
Off-Balance Sheet Arrangements and Aggregate Contractual Obligations
Off-Balance Sheet Arrangements
In accordance with the definition under SEC rules, the following qualify as off-balance sheet arrangements:
any obligation under certain guarantee contracts;
a retained or contingent interest in assets transferred to an unconsolidated entity or similar arrangement that serves as credit, liquidity or market risk support to that entity for such assets;
any obligation under certain derivative instruments; and
any obligation arising out of a material variable interest held by the registrant in an unconsolidated entity that provides financing, liquidity, market risk or credit risk support to the registrant, or engages in leasing, hedging or research and development services with the registrant.
As of December 31, 2014,2015, we were contingently liable for guarantees of indebtedness owed by third parties of $565$572 million, of which $155$263 million was related to VIEs. These guarantees are primarily related to third-party customers, bottlers, vendors and container manufacturing operations and have arisen through the normal course of business. These guarantees have various terms, and none of these guarantees was individually significant. The amount represents the maximum potential future payments that we could be required to make under the guarantees; however, we do not consider it probable that we will be required to satisfy these guarantees. Management concluded that the likelihood of any significant amounts being paid by our

66



Company under these guarantees is not probable. As of December 31, 2014,2015, we were not directly liable for the debt of any unconsolidated entity, and we did not have any retained or contingent interest in assets as defined above.
Our Company recognizes all derivatives as either assets or liabilities at fair value in our consolidated balance sheets. Refer to Note 5 of Notes to Consolidated Financial Statements.

64



As of December 31, 2014,2015, the Company had $7,677$8,340 million in lines of credit for general corporate purposes. These backup lines of credit expire at various times from 20152016 through 2019. There were no borrowings under these backup lines of credit during 2014.2015. These credit facilities are subject to normal banking terms and conditions. Some of the financial arrangements require compensating balances, none of which are presently significant to our Company.
Aggregate Contractual Obligations
As of December 31, 20142015, the Company's contractual obligations, including payments due by period, were as follows (in millions):
Payments Due by Period  
Payments Due by Period  
Total
 2015
 2016-2017
 2018-2019
 
2020 and
Thereafter

Total
 2016
 2017-2018
 2019-2020
 
2021 and
Thereafter

Short-term loans and notes payable:1
                  
Commercial paper borrowings$19,010
 $19,010
 $
 $
 $
$13,035
 $13,035
 $
 $
 $
Lines of credit and other short-term borrowings120
 120
 
 
 
95
 95
 
 
 
Current maturities of long-term debt2
3,529
 3,529
 
 
 
2,679
 2,679
 
 
 
Long-term debt, net of current maturities2
18,708
 
 4,085
 4,327
 10,296
28,150
 
 6,660
 6,232
 15,258
Estimated interest payments3
5,084
 473
 908
 675
 3,028
6,011
 553
 1,022
 899
 3,537
Accrued income taxes4
400
 400
 
 
 
331
 331
 
 
 
Purchase obligations5
15,295
 9,166
 1,028
 764
 4,337
16,365
 9,812
 1,303
 840
 4,410
Marketing obligations6
4,043
 2,143
 944
 438
 518
4,260
 2,302
 914
 546
 498
Lease obligations1,162
 269
 344
 217
 332
900
 212
 254
 172
 262
Held-for-sale obligations7
63
 28
 17
 10
 8
838
 675
 87
 40
 36
Total contractual obligations$67,414
 $35,138
 $7,326
 $6,431
 $18,519
$72,664
 $29,694
 $10,240
 $8,729
 $24,001
1 
Refer to Note 10 of Notes to Consolidated Financial Statements for information regarding short-term loans and notes payable. Upon payment of outstanding commercial paper, we typically issue new commercial paper. Lines of credit and other short-term borrowings are expected to fluctuate depending upon current liquidity needs, especially at international subsidiaries.
2 
Refer to Note 10 of Notes to Consolidated Financial Statements for information regarding long-term debt. We will consider several alternatives to settle this long-term debt, including the use of cash flows from operating activities, issuance of commercial paper or issuance of other long-term debt.
3 
We calculated estimated interest payments for our long-term debt based on the applicable rates and payment dates. For our variable rate debt, we have assumed the December 31, 20142015 rate for all years presented. We typically expect to settle such interest payments with cash flows from operating activities and/or short-term borrowings.
4 
Refer to Note 14 of Notes to Consolidated Financial Statements for information regarding income taxes. As of December 31, 2014,2015, the noncurrent portion of our income tax liability, including accrued interest and penalties related to unrecognized tax benefits, was $314$267 million, which was not included in the total above. At this time, the settlement period for the noncurrent portion of our income tax liability cannot be determined. In addition, any payments related to unrecognized tax benefits would be partially offset by reductions in payments in other jurisdictions.
5 
Purchase obligations include agreements to purchase goods or services that are enforceable and legally binding and that specify all significant terms, including long-term contractual obligations, open purchase orders, accounts payable and certain accrued liabilities. We expect to fund these obligations with cash flows from operating activities.
6 
We expect to fund these marketing obligations with cash flows from operating activities.
7 
Represents liabilities of the Company's North American territories, German bottling operations and South African bottling operations that are classified as held for sale.

67



The total accrued benefit liability for pension and other postretirement benefit plans recognized as of December 31, 2014,2015, was $2,683$2,619 million. Refer to Note 13 of Notes to Consolidated Financial Statements. This amount is impacted by, among other items, pension expense, funding levels, plan amendments, changes in plan demographics and assumptions, and the investment return on plan assets. Because the accrued liability does not represent expected liquidity needs, we did not include this amount in the contractual obligations table.
We generally expect to fund all future pension contributions with cash flows from operating activities. Our international pension plans are generally funded in accordance with local laws and income tax regulations.

65



As of December 31, 2014,2015, the projected benefit obligation of the U.S. qualified pension plans was $7,041$6,405 million, and the fair value of plan assets was $6,343$5,628 million. The projected benefit obligation of all pension plans other than the U.S. qualified pension plans was $3,305$2,754 million, and the fair value of all other pension plan assets was $2,559$2,061 million. The majority of this underfunding is attributable to an international pension plan for certain non-U.S. employees that is unfunded due to tax law restrictions, as well as certain unfunded U.S. nonqualified pension plans. These U.S. nonqualified pension plans provide, for certain associates, benefits that are not permitted to be funded through a qualified plan because of limits imposed by the Internal Revenue Code of 1986. The expected benefit payments for these unfunded pension plans are not included in the table above. However, we anticipate annual benefit payments for these unfunded pension plans to be approximately $73$72 million in 20152016 and remain near that level through 2027,2031, decreasing annually thereafter. Refer to Note 13 of Notes to Consolidated Financial Statements.
In 2015, we expectThe Company expects to contribute an additional $90$512 million to our internationalglobal pension plans, the majority of which will be allocated to our U.S. plans. Refer to Note 13 of Notes to Consolidated Financial Statements. We did not include our estimated contributions to our various plans in the table above.
In general, we are self-insured for large portions of many different types of claims; however, we do use commercial insurance above our self-insured retentions to reduce the Company's risk of catastrophic loss. Our reserves for the Company's self-insured losses are estimated through actuarial procedures of the insurance industry and by using industry assumptions, adjusted for our specific expectations based on our claim history. As of December 31, 2014,2015, our self-insurance reserves totaled $530$560 million. Refer to Note 11 of Notes to Consolidated Financial Statements. We did not include estimated payments related to our self-insurance reserves in the table above.
Deferred income tax liabilities as of December 31, 2014,2015 were $6,086$5,434 million. Refer to Note 14 of Notes to Consolidated Financial Statements. This amount is not included in the total contractual obligations table because we believe that presentation would not be meaningful. Deferred income tax liabilities are calculated based on temporary differences between the tax bases of assets and liabilities and their respective book bases, which will result in taxable amounts in future years when the liabilities are settled at their reported financial statement amounts. The results of these calculations do not have a direct connection with the amount of cash taxes to be paid in any future periods. As a result, scheduling deferred income tax liabilities as payments due by period could be misleading, because this scheduling would not relate to liquidity needs.
Additionally, as of December 31, 2014, the Company had entered into agreements related to the following future investing activities which are not included in the table above:
In May 2014, the Company entered into an agreement with Credit Suisse Capital LLC ("CS") to purchase additional shares of Keurig which would increase the Company's equity position to a 16 percent interest based on the total number of issued and outstanding shares of Keurig as of May 1, 2014. Under the agreement, the Company will purchase from CS, on a date selected by CS no later than February 2015, the lesser of (1) 6.5 million shares of Keurig or (2) the number of shares that shall cause our ownership to equal 16 percent. The purchase price per share will be the average of the daily volume-weighted average price per share from May 15, 2014, to the date selected by CS, as adjusted in certain circumstances specified in the agreement. CS will have exclusive ownership and control over any such shares until delivered to the Company. In February 2015, the Company purchased 6.4 million shares from CS under this agreement for a total purchase price of $830 million.
In August 2014, the Company and Monster entered into definitive agreements for a long-term strategic relationship in the global energy drink category. Upon closing of the related transactions, which is expected to take place in the second quarter of 2015, the Company will make a net cash payment of $2.15 billion to Monster. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information on these agreements.
In November 2014, Coca-Cola Amatil Limited ("Coca-Cola Amatil"), an equity method investee, and the Company announced they had reached an agreement under which the Company would invest $500 million for a 29 percent interest in PT Coca-Cola Bottling Indonesia, a subsidiary of Coca-Cola Amatil. This proposed investment is expected to close in mid to late 2015.


66



Foreign Exchange
Our international operations are subject to certain opportunities and risks, including currency fluctuations and governmental actions. We closely monitor our operations in each country and seek to adopt appropriate strategies that are responsive to changing economic and political environments, and to fluctuations in foreign currencies.

68



In 2014,2015, we used 7172 functional currencies. Due to the geographic diversity of our global operations, weakness in some of these currencies might be offset by strength in others. In 2015, 2014 2013 and 2012,2013, the weighted-average exchange rates for foreign currencies in which the Company conducted operations (all operating currencies), and for certain individual currencies, strengthened (weakened) against the U.S. dollar as follows:
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
All operating currencies(5)% (5)% (6)%(15)% (5)% (5)%
Brazilian real(10)% (9)% (14)%(27)% (10)% (9)%
Mexican peso(4) 4
 (7)(16) (4) 4
Australian dollar(7) (6) 
(17) (7) (6)
South African rand(12) (13) (12)(15) (12) (13)
British pound6
 (2) (1)(8) 6
 (2)
Euro1
 3
 (9)(17) 1
 3
Japanese yen(8) (18) 2
(14) (8) (18)
These percentages do not include the effects of our hedging activities and, therefore, do not reflect the actual impact of fluctuations in foreign currency exchange rates on our operating results. Our foreign currency management program is designed to mitigate, over time, a portion of the impact of exchange rate changes on our net income and earnings per share.
The total currency impactimpacts on net operating revenues, including the effect of our hedging activities, was a decreasewere decreases of 7 percent and 2 percent in both2015 and 2014, and 2013.respectively. The total currency impacts on income before income taxes, including the effect of our hedging activities, were decreases of 6 percent in 2015 and 9 percent in 2014 and 5 percent in 2013. Based on current spot rates and our existing hedge positions, we estimate that currency will have an unfavorable impact of 5 percent on net operating revenues and an unfavorable impact of 7 to 8 percent on income before income taxes for the full year of 2015. For the first quarter of 2015, we estimate that currency will have an unfavorable impact of 6 percent on net operating revenues and an unfavorable impact of 8 percent on income before income taxes.2014.
Foreign currency exchange gains and losses are primarily the result of the remeasurement of monetary assets and liabilities from certain currencies into functional currencies. The effects of the remeasurement of these assets and liabilities are partially offset by the impact of our economic hedging program for certain exposures on our consolidated balance sheets. Refer to Note 5 of Notes to Consolidated Financial Statements. Foreign currency exchange gains and losses are included as a component of other income (loss) — net in our consolidated financial statements. Refer to the heading "Operations Review — Other Income (Loss) — Net" above. The Company recorded foreign currency exchange gains of $149 million in 2015 and foreign currency losses of $569 million $162 million and $2$162 million in 2014 2013 and 2012,2013, respectively.
Hyperinflationary Economies
A hyperinflationary economy is one that has cumulative inflation of 100 percent or more over a three-year period. In accordance with accounting principles generally accepted in the United States, local subsidiaries in hyperinflationary economies are required to use the U.S. dollar as their functional currency and remeasure the monetary assets and liabilities not denominated in U.S. dollars using the rate applicable to conversion of a currency for purposes of dividend remittances. All exchange gains and losses resulting from remeasurement are recognized currently in income.
Venezuela has been designated as a hyperinflationary economy. In February 2013, the Venezuelan government devalued its currency to an official rate of exchange ("official rate") of 6.3 bolivars per U.S. dollar. At that time, the Company remeasured the net monetary assets of our Venezuelan subsidiary at the official rate. As a result of the devaluation, we recognized a loss of $140 million from remeasurement in the line item other income (loss) — net in our consolidated statement of income.
Beginning in the first quarter of 2014, the Venezuelan government recognized three legal exchange rates to convert bolivars to the U.S. dollar: 1)(1) the official rate of 6.3 bolivars per U.S. dollar; 2)(2) SICAD 1, which iswas available to foreign investments and designated industry sectors to exchange a limited volume of bolivars for U.S. dollars using a bid rate established at weekly auctions; and 3)(3) SICAD 2, which appliesapplied to transactions that dodid not qualify for either the official rate or SICAD 1. As of March 28, 2014, the three legal exchange rates were 6.3 (official rate), 10.8 (SICAD 1) and 50.9 (SICAD 2). We determined that the SICAD 1 rate was the most appropriate rate to use for remeasurement given our circumstances and estimates of the applicable

67



rate at which future transactions could be settled, including the payment of dividends. Therefore, as of March 28, 2014, we remeasured the net monetary assets of our Venezuelan subsidiary using an exchange rate of 10.8 bolivars per U.S. dollar, resulting in a charge of $226 million recorded in the line item other income (loss) — net in our consolidated statement of income.

69



In December 2014, due to the continued lack of liquidity and increasing economic uncertainty, the Company reevaluated the rate that should be used to remeasure the monetary assets and liabilities of our Venezuelan subsidiary. As of December 31, 2014, we determined that the SICAD 2 rate of 50 bolivars per U.S. dollar was the most appropriate legally available rate and remeasured the net monetary assets of our Venezuelan subsidiary, resulting in a charge of $146 million recorded in the line item other income (loss) — net in our consolidated statement of income.
In February 2015, the Venezuelan government replaced themerged SICAD 1 and SICAD 2 rate withinto a single mechanism called SICAD and introduced a new open market exchange rate system, SIMADI. As a result, of this change, management is currently evaluating which ofdetermined that the three legally available rates isSIMADI rate was the most appropriate to use for the remeasurement oflegally available rate and remeasured the net monetary assets of our Venezuelan subsidiary, resulting in a charge of $27 million recorded in the future. Our equity method investee that has bottling operationsline item other income (loss) — net in Venezuela is also evaluating whichour consolidated statement of these rates is the most appropriate to use for the remeasurement of the net monetary assets of their Venezuelan subsidiary in the future.income.
In addition to the foreign currency exchange exposure related to our Venezuelan subsidiary's net monetary assets, we also sell concentrate to our bottling partner in Venezuela from outside the country. These sales are denominated in U.S. dollars. During the yearyears ended December 31, 2015 and December 31, 2014, as a result of the continued lack of liquidity and our revised assessment of the U.S. dollar value we expect to realize upon the conversion of Venezuelan bolivars into U.S. dollars by our bottling partner to pay our concentrate sales receivables, we recorded a write-downwrite-downs of $56 million and $296 million, respectively, recorded in the line item other operating charges in our consolidated statementstatements of income.
We also have certain U.S. dollar denominated intangible assets associated with products sold in Venezuela. In January 2014, the Venezuelan government enacted a new law which imposes limits on profit margins earned in the country, reducing the Company's cash flows for as long as the law remains in effect. As a result of this law and the Company's revised expectations regarding the convertibility of the local currency, we recognized an impairment chargecharges of $55 million and $18 million, respectively, during the yearyears ended December 31, 2014,2015 and December 31, 2014. These charges were recorded in the line item other operating charges in our consolidated statementstatements of income. Further government regulation or changes in exchange rates could result in additional impairments
During the year ended December 31, 2015, the Company continued to use the SIMADI rate to remeasure the net monetary assets of these intangible assets.
our Venezuelan subsidiary. As of December 31, 2014,2015, the combined value of the net monetary assets of our Venezuelan subsidiary, the concentrate sales receivables from our bottling partner in Venezuela and the intangible assets associated with products sold in Venezuela was $180$100 million. Included in this combined value is $52$15 million of cash and cash equivalents. Despite the additional currency conversion mechanisms, the Company's ability to pay dividends from Venezuela is still restricted due to the low volume of U.S. dollars available for conversion. If
In February 2016, the bolivar devalues further,Venezuelan government devalued its currency and changed its official and most preferential exchange rate, which will continue to be used for purchases of certain essential goods, to 10 bolivars per U.S. dollar from 6.3. The Venezuelan government announced it would likelywill reduce its three-tier system of exchange rates to two tiers by eliminating the SICAD rate. Additionally, the government announced that the SIMADI rate will be allowed to float freely beginning at a rate of 203 bolivars per U.S. dollar. As a result, in ourthe Company recognizing additionalexpects to continue to record losses on foreign currency exchange, losses,may incur additional write-downs of receivables or impairment charges and will continue to record our proportionate share of any charges recorded by our equity method investee.investee that has operations in Venezuela.
Impact of Inflation and Changing Prices
Inflation affects the way we operate in many markets around the world. In general, we believe that, over time, we arewill be able to increase prices to counteract the majority of the inflationary effects of increasing costs and to generate sufficient cash flows to maintain our productive capability.

6870



Overview of Financial Position
The following table illustrates the change in the individual line items of the Company's consolidated balance sheet (in millions):
December 31,2014
 2013
 Increase (Decrease)
 Percent Change
2015
 2014
 Increase (Decrease)
 Percent Change
Cash and cash equivalents$8,958
 $10,414
 $(1,456) (14)%$7,309
 $8,958
 $(1,649) (18)%
Short-term investments9,052
 6,707
 2,345
 35
8,322
 9,052
 (730) (8)
Marketable securities3,665
 3,147
 518
 16
4,269
 3,665
 604
 16
Trade accounts receivable — net4,466
 4,873
 (407) (8)3,941
 4,466
 (525) (12)
Inventories3,100
 3,277
 (177) (5)2,902
 3,100
 (198) (6)
Prepaid expenses and other assets3,066
 2,886
 180
 6
2,752
 3,066
 (314) (10)
Assets held for sale679
 
 679
 100
3,900
 679
 3,221
 474
Equity method investments9,947
 10,393
 (446) (4)12,318
 9,947
 2,371
 24
Other investments3,678
 1,119
 2,559
 229
3,470
 3,678
 (208) (6)
Other assets4,407
 4,661
 (254) (5)4,207
 4,407
 (200) (5)
Property, plant and equipment — net14,633
 14,967
 (334) (2)12,571
 14,633
 (2,062) (14)
Trademarks with indefinite lives6,533
 6,744
 (211) (3)5,989
 6,533
 (544) (8)
Bottlers' franchise rights with indefinite lives6,689
 7,415
 (726) (10)6,000
 6,689
 (689) (10)
Goodwill12,100
 12,312
 (212) (2)11,289
 12,100
 (811) (7)
Other intangible assets1,050
 1,140
 (90) (8)854
 1,050
 (196) (19)
Total assets$92,023
 $90,055
 $1,968
 2 %$90,093
 $92,023
 $(1,930) (2)%
Accounts payable and accrued expenses$9,234
 $9,577
 $(343) (4)%$9,660
 $9,234
 $426
 5 %
Loans and notes payable19,130
 16,901
 2,229
 13
13,129
 19,130
 (6,001) (31)
Current maturities of long-term debt3,552
 1,024
 2,528
 247
2,677
 3,552
 (875) (25)
Accrued income taxes400
 309
 91
 29
331
 400
 (69) (17)
Liabilities held for sale58
 
 58
 100
1,133
 58
 1,075
 1,853
Long-term debt19,063
 19,154
 (91) 
28,407
 19,063
 9,344
 49
Other liabilities4,389
 3,498
 891
 25
4,301
 4,389
 (88) (2)
Deferred income taxes5,636
 6,152
 (516) (8)4,691
 5,636
 (945) (17)
Total liabilities$61,462
 $56,615
 $4,847
 9 %$64,329
 $61,462
 $2,867
 5 %
Net assets$30,561
 $33,440
 $(2,879)
1 
(9)%$25,764
 $30,561
 $(4,797)
1 
(16)%
1 
Includes a decrease in net assets of $2,382$3,959 million resulting from foreign currency translation adjustments in various balance sheet accounts.
The increases (decreases) in the individual line items in the table above includes the impact of the following transactionsare primarily attributable to North America refranchising and events:
Cash and cash equivalents, short-term investments and marketable securities increased $1,407 million, or 7 percent, as a combined group. This increase reflects the Company's overall cash management strategy. A majority of the Company's consolidated cash and cash equivalents, short-term investments and marketable securities are held by foreign subsidiaries.
Trade accounts receivable — net decreased $407 million, or 8 percent, primarily due to the write-down of concentrate sales receivables from ourGerman bottling partner in Venezuela.
Assets held for sale increased $679 million and liabilities held for sale increased $58 million due primarily to certain North American territories, our South African bottling operations and related investments, and the assets held by the Company's global energy drink business being classified as held for sale. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information on these transactions.information. Additionally, the increases (decreases) include the impact of the following:

69



OtherEquity method investments increased $2,559 million, or 229 percent, primarily due to the Company'sour investment in Keurig, which is accounted for as an available-for-sale security.Monster and a bottling partner in Indonesia, partially offset by the unfavorable impact of foreign currency exchange rate fluctuations. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information on this investment.information.
Loans and notes payable increased $2,229 million, or 13 percent, and current maturities of long-term debt increased $2,528 million, or 247 percent,Trademarks with indefinite lives decreased primarily due to the net issuancessale of commercial paper during 2014,our energy brands and the reclassification of long-term debt that is scheduled to mature within a year from the line item long-term debt.
Long-term debt decreased $91 million due to the reclassification of certain portionsdiscontinuation of the Company's long-term debt intoenergy products in the line item current maturities of long-term debt since it is scheduled to mature within a year, offset by the issuances of debt during the year ended December 31, 2014.
Other liabilities increased $891 million, or 25 percent, primarily due to the increase in pension plan liabilitiesglacéau portfolio as a result of a decrease in the weighted-average discount rate and unfavorable pension asset performance compared to our expected return during 2014, partially offset by current year contributions. Refer to Note 13 of Notes to Consolidated Financial Statements for additional information on the Company's pension plans.
Deferred income taxes decreased $516 million, or 8 percent, primarily due to the impact related to the net changes in the Company's U.S. pension plan assumptions as well as the impact of the refranchising of certain North American territories.Monster Transaction. Refer to Note 2 of Notes to Consolidated Financial Statements for additional information oninformation.
Loans and notes payable and current maturities of long-term debt decreased primarily due to the North America refranchisingpayments related to commercial paper and the retirement of $3,500 million of long-term debt during the year ended December 31, 2015.
Long-term debt increased primarily due to the issuances of Swiss franc-denominated, euro-denominated and U.S. dollar-denominated debt, partially offset by the early extinguishment of debt during the year ended December 31, 2015. Refer to Note 1310 of Notes to Consolidated Financial Statements for additional information on the Company's deferred income taxes.information.

71



ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Our Company uses derivative financial instruments primarily to reduce our exposure to adverse fluctuations in foreign currency exchange rates, interest rates, commodity prices and other market risks. We do not enter into derivative financial instruments for trading purposes. As a matter of policy, all of our derivative positions are used to reduce risk by hedging an underlying economic exposure. Because of the high correlation between the hedging instrument and the underlying exposure, fluctuations in the value of the instruments are generally offset by reciprocal changes in the value of the underlying exposure. The Company generally hedges anticipated exposures up to 36 months in advance; however, the majority of our derivative instruments expire within 24 months or less. Virtually all of our derivatives are straightforward over-the-counter instruments with liquid markets.
We monitor our exposure to financial market risks using several objective measurement systems, including a sensitivity analysis to measure our exposure to fluctuations in foreign currency exchange rates, interest rates and commodity prices. Refer to Note 5 of Notes to Consolidated Financial Statements for additional information about our hedging transactions and derivative financial instruments.
Foreign Currency Exchange Rates
We manage most of our foreign currency exposures on a consolidated basis, which allows us to net certain exposures and take advantage of any natural offsets. In 2014,2015, we used 7172 functional currencies and generated $26,235$23,934 million of our net operating revenues from operations outside the United States; therefore, weaknessweaknesses in one particular currencysome currencies might be offset by strengthstrengths in other currencies over time. We use derivative financial instruments to further reduce our net exposure to foreign currency fluctuations.
Our Company enters into forward exchange contracts and purchases currency options (principally euros and Japanese yen) and collars to hedge certain portions of forecasted cash flows denominated in foreign currencies. Additionally, we enter into forward exchange contracts to offset the earnings impact related to foreign currency fluctuations on certain monetary assets and liabilities. We also enter into forward exchange contracts as hedges of net investments in international operations.
The total notional values of our foreign currency derivatives were $23,553$18,060 million and $15,341$23,553 million as of December 31, 20142015 and 2013,2014, respectively. This total includes derivative instruments that are designated and qualify for hedge accounting as well as economic hedges. The fair value of the contracts that qualify for hedge accounting resulted in an asseta net unrealized gain of $996$692 million as of December 31, 2014.2015. At the end of 2014,2015, we estimate that a 10 percent weakening of the U.S. dollar would have eliminated the net unrealized gain and created an unrealized loss of $103$486 million. The fair value of the contracts that do not qualify for hedge accounting resulted in an asseta net unrealized gain of $221$278 million, and we estimate that a 10 percent weakening of the U.S. dollar would have increased ourdecreased the net gains by $304unrealized gain to $238 million.

70



Interest Rates
The Company is subject to interest rate volatility with regard to existing and future issuances of debt. We monitor our mix of fixed-rate and variable-rate debt as well as our mix of short-term debt versusand long-term debt. From time to time, we enter into interest rate swap agreements to manage our exposure to interest rate fluctuations.
Based on the Company's variable-rate debt and derivative instruments outstanding as of December 31, 2014,2015, a 1 percentage point increase in interest rates would have increased interest expense by $148$252 million in 2014.2015. However, this increase in interest expense would have been partially offset by the increase in interest income related to higher interest rates.
The Company is exposedsubject to interest rate risk related to its investments in highly liquid securities. These investments are primarily managed by external managers within the guidelines of the Company's investment policy. Our policy requires investments to be investment grade, with the primary objective of minimizing the potential risk of principal loss. In addition, our policy limits the amount of credit exposure to any one issuer. We estimate that a 1 percentage point increase in interest rates would result in a $57$52 million decrease in the fair market value of the portfolio.our portfolio of highly liquid securities.

72



Commodity Prices
The Company is subject to market risk with respect to commodity price fluctuations, principally related to our purchases of sweeteners, metals, juices, PET and fuels. We manage our exposure to commodity risks primarily through the use of supplier pricing agreements that enable us to establish the purchase prices for certain inputs that are used in our manufacturing and distribution business. We also use derivative financial instruments to manage our exposure to commodity risks at times. Certain of these derivatives do not qualify for hedge accounting, but they are effective economic hedges that help the Company mitigate the price risk associated with the purchases of materials used in our manufacturing processes and the fuel used to operate our extensive vehicle fleet.
Open commodity derivatives that qualify for hedge accounting had notional values of $9$8 million and $26$9 million as of December 31, 20142015 and 2013,2014, respectively. The fair value of the contracts that qualify for hedge accounting resulted in a liabilitynet unrealized gain of $1 million. The potential change in fair value of these commodity derivative instruments, assuming a 10 percent decrease in underlying commodity prices, would have resulted in a net unrealized loss of $2$1 million.
Open commodity derivatives that do not qualify for hedge accounting had notional values of $816$893 million and $1,441$816 million as of December 31, 20142015 and 2013,2014, respectively. The fair value of the contracts that do not qualify for hedge accounting resulted in a liabilitynet unrealized loss of $163$170 million. The potential change in fair value of these commodity derivative instruments, assuming a 10 percent decrease in underlying commodity prices, would have increased the net unrealized lossesloss to a loss of $205$226 million.

7173



ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
TABLE OF CONTENTS


7274



THE COCA-COLA COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
(In millions except per share data)      
NET OPERATING REVENUES$45,998
 $46,854
 $48,017
$44,294
 $45,998
 $46,854
Cost of goods sold17,889
 18,421
 19,053
17,482
 17,889
 18,421
GROSS PROFIT28,109
 28,433
 28,964
26,812
 28,109
 28,433
Selling, general and administrative expenses17,218
 17,310
 17,738
16,427
 17,218
 17,310
Other operating charges1,183
 895
 447
1,657
 1,183
 895
OPERATING INCOME9,708
 10,228
 10,779
8,728
 9,708
 10,228
Interest income594
 534
 471
613
 594
 534
Interest expense483
 463
 397
856
 483
 463
Equity income (loss) — net769
 602
 819
489
 769
 602
Other income (loss) — net(1,263) 576
 137
631
 (1,263) 576
INCOME BEFORE INCOME TAXES9,325
 11,477
 11,809
9,605
 9,325
 11,477
Income taxes2,201
 2,851
 2,723
2,239
 2,201
 2,851
CONSOLIDATED NET INCOME7,124
 8,626
 9,086
7,366
 7,124
 8,626
Less: Net income attributable to noncontrolling interests26
 42
 67
15
 26
 42
NET INCOME ATTRIBUTABLE TO SHAREOWNERS OF
THE COCA-COLA COMPANY
$7,098
 $8,584
 $9,019
$7,351
 $7,098
 $8,584
BASIC NET INCOME PER SHARE1
$1.62
 $1.94
 $2.00
$1.69
 $1.62
 $1.94
DILUTED NET INCOME PER SHARE1
$1.60
 $1.90
 $1.97
$1.67
 $1.60
 $1.90
AVERAGE SHARES OUTSTANDING4,387
 4,434
 4,504
4,352
 4,387
 4,434
Effect of dilutive securities63
 75
 80
53
 63
 75
AVERAGE SHARES OUTSTANDING ASSUMING DILUTION4,450
 4,509
 4,584
4,405
 4,450
 4,509
1 
Calculated based on net income attributable to shareowners of The Coca-Cola Company.
Refer to Notes to Consolidated Financial Statements.

7375



THE COCA-COLA COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Year Ended December 31,2014
 2013
 2012
(In millions)   
CONSOLIDATED NET INCOME$7,124
 $8,626
 $9,086
Other comprehensive income:     
Net foreign currency translation adjustment(2,382) (1,187) (182)
Net gain (loss) on derivatives357
 151
 99
Net unrealized gain (loss) on available-for-sale securities714
 (80) 178
Net change in pension and other benefit liabilities(1,039) 1,066
 (668)
TOTAL COMPREHENSIVE INCOME4,774
 8,576
 8,513
Less: Comprehensive income (loss) attributable to noncontrolling interests21
 39
 105
TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO
   SHAREOWNERS OF THE COCA-COLA COMPANY
$4,753
 $8,537
 $8,408
Refer to Notes to Consolidated Financial Statements.

74



THE COCA-COLA COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
December 31,2014
 2013
(In millions except par value)   
ASSETS   
CURRENT ASSETS   
Cash and cash equivalents$8,958
 $10,414
Short-term investments9,052
 6,707
TOTAL CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS18,010
 17,121
Marketable securities3,665
 3,147
Trade accounts receivable, less allowances of $331 and $61, respectively4,466
 4,873
Inventories3,100
 3,277
Prepaid expenses and other assets3,066
 2,886
Assets held for sale679
 
TOTAL CURRENT ASSETS32,986
 31,304
EQUITY METHOD INVESTMENTS9,947
 10,393
OTHER INVESTMENTS3,678
 1,119
OTHER ASSETS4,407
 4,661
PROPERTY, PLANT AND EQUIPMENT — net14,633
 14,967
TRADEMARKS WITH INDEFINITE LIVES6,533
 6,744
BOTTLERS' FRANCHISE RIGHTS WITH INDEFINITE LIVES6,689
 7,415
GOODWILL12,100
 12,312
OTHER INTANGIBLE ASSETS1,050
 1,140
TOTAL ASSETS$92,023
 $90,055
LIABILITIES AND EQUITY   
CURRENT LIABILITIES   
Accounts payable and accrued expenses$9,234
 $9,577
Loans and notes payable19,130
 16,901
Current maturities of long-term debt3,552
 1,024
Accrued income taxes400
 309
Liabilities held for sale58
 
TOTAL CURRENT LIABILITIES32,374
 27,811
LONG-TERM DEBT19,063
 19,154
OTHER LIABILITIES4,389
 3,498
DEFERRED INCOME TAXES5,636
 6,152
THE COCA-COLA COMPANY SHAREOWNERS' EQUITY   
          Common stock, $0.25 par value; Authorized — 11,200 shares;
               Issued — 7,040 and 7,040 shares, respectively
1,760
 1,760
Capital surplus13,154
 12,276
Reinvested earnings63,408
 61,660
Accumulated other comprehensive income (loss)(5,777) (3,432)
Treasury stock, at cost — 2,674 and 2,638 shares, respectively(42,225) (39,091)
EQUITY ATTRIBUTABLE TO SHAREOWNERS OF THE COCA-COLA COMPANY30,320
 33,173
EQUITY ATTRIBUTABLE TO NONCONTROLLING INTERESTS241
 267
TOTAL EQUITY30,561
 33,440
TOTAL LIABILITIES AND EQUITY$92,023
 $90,055
Refer to Notes to Consolidated Financial Statements.

75



THE COCA-COLA COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year Ended December 31,2014
 2013
 2012
(In millions)   
OPERATING ACTIVITIES     
Consolidated net income$7,124
 $8,626
 $9,086
Depreciation and amortization1,976
 1,977
 1,982
Stock-based compensation expense209
 227
 259
Deferred income taxes(40) 648
 632
Equity (income) loss — net of dividends(371) (201) (426)
Foreign currency adjustments415
 168
 (130)
Significant (gains) losses on sales of assets — net831
 (670) (98)
Other operating charges761
 465
 166
Other items149
 234
 254
Net change in operating assets and liabilities(439) (932) (1,080)
Net cash provided by operating activities10,615
 10,542
 10,645
INVESTING ACTIVITIES     
Purchases of investments(17,800) (14,782) (14,824)
Proceeds from disposals of investments12,986
 12,791
 7,791
Acquisitions of businesses, equity method investments and nonmarketable securities(389) (353) (1,486)
Proceeds from disposals of businesses, equity method investments and nonmarketable securities148
 872
 20
Purchases of property, plant and equipment(2,406) (2,550) (2,780)
Proceeds from disposals of property, plant and equipment223
 111
 143
Other investing activities(268) (303) (268)
Net cash provided by (used in) investing activities(7,506) (4,214) (11,404)
FINANCING ACTIVITIES     
Issuances of debt41,674
 43,425
 42,791
Payments of debt(36,962) (38,714) (38,573)
Issuances of stock1,532
 1,328
 1,489
Purchases of stock for treasury(4,162) (4,832) (4,559)
Dividends(5,350) (4,969) (4,595)
Other financing activities(363) 17
 100
Net cash provided by (used in) financing activities(3,631) (3,745) (3,347)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND
     CASH EQUIVALENTS
(934) (611) (255)
CASH AND CASH EQUIVALENTS     
Net increase (decrease) during the year(1,456) 1,972
 (4,361)
Balance at beginning of year10,414
 8,442
 12,803
Balance at end of year$8,958
 $10,414
 $8,442
Year Ended December 31,2015
 2014
 2013
(In millions)   
CONSOLIDATED NET INCOME$7,366
 $7,124
 $8,626
Other comprehensive income:     
Net foreign currency translation adjustment(3,959) (2,382) (1,187)
Net gain (loss) on derivatives142
 357
 151
Net unrealized gain (loss) on available-for-sale securities(684) 714
 (80)
Net change in pension and other benefit liabilities86
 (1,039) 1,066
TOTAL COMPREHENSIVE INCOME2,951
 4,774
 8,576
Less: Comprehensive income (loss) attributable to noncontrolling interests(3) 21
 39
TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO
   SHAREOWNERS OF THE COCA-COLA COMPANY
$2,954
 $4,753
 $8,537
Refer to Notes to Consolidated Financial Statements.

76



THE COCA-COLA COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREOWNERS' EQUITYBALANCE SHEETS
Year Ended December 31,2014
 2013
 2012
(In millions except per share data)   
EQUITY ATTRIBUTABLE TO SHAREOWNERS OF THE COCA-COLA COMPANY     
    NUMBER OF COMMON SHARES OUTSTANDING
     
Balance at beginning of year4,402
 4,469
 4,526
Purchases of treasury stock(98) (121) (121)
Treasury stock issued to employees related to stock compensation plans62
 54
 64
Balance at end of year4,366
 4,402
 4,469
    COMMON STOCK
$1,760
 $1,760
 $1,760
    CAPITAL SURPLUS
     
Balance at beginning of year12,276
 11,379
 10,332
Stock issued to employees related to stock compensation plans526
 569
 640
Tax benefit (charge) from stock compensation plans169
 144
 144
Stock-based compensation209
 227
 259
Other activities(26) (43) 4
Balance at end of year13,154
 12,276
 11,379
    REINVESTED EARNINGS
     
Balance at beginning of year61,660
 58,045
 53,621
Net income attributable to shareowners of The Coca-Cola Company7,098
 8,584
 9,019
Dividends (per share — $1.22, $1.12 and $1.02 in 2014, 2013 and 2012, respectively)(5,350) (4,969) (4,595)
Balance at end of year63,408
 61,660
 58,045
    ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
     
Balance at beginning of year(3,432) (3,385) (2,774)
Net other comprehensive income (loss)(2,345) (47) (611)
Balance at end of year(5,777) (3,432) (3,385)
    TREASURY STOCK
     
Balance at beginning of year(39,091) (35,009) (31,304)
Stock issued to employees related to stock compensation plans891
 745
 786
Purchases of treasury stock(4,025) (4,827) (4,491)
Balance at end of year(42,225) (39,091) (35,009)
TOTAL EQUITY ATTRIBUTABLE TO SHAREOWNERS OF
   THE COCA-COLA COMPANY
$30,320
 $33,173
 $32,790
EQUITY ATTRIBUTABLE TO NONCONTROLLING INTERESTS     
Balance at beginning of year$267
 $378
 $286
Net income attributable to noncontrolling interests26
 42
 67
Net foreign currency translation adjustment(5) (3) 38
Dividends paid to noncontrolling interests(25) (58) (48)
Acquisition of interests held by noncontrolling owners
 (34) (15)
Contributions by noncontrolling interests
 6
 
Business combinations(22) 25
 50
Deconsolidation of certain entities
 (89) 
TOTAL EQUITY ATTRIBUTABLE TO NONCONTROLLING INTERESTS$241
 $267
 $378
December 31,2015
 2014
(In millions except par value)   
ASSETS   
CURRENT ASSETS   
Cash and cash equivalents$7,309
 $8,958
Short-term investments8,322
 9,052
TOTAL CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS15,631
 18,010
Marketable securities4,269
 3,665
Trade accounts receivable, less allowances of $352 and $331, respectively3,941
 4,466
Inventories2,902
 3,100
Prepaid expenses and other assets2,752
 3,066
Assets held for sale3,900
 679
TOTAL CURRENT ASSETS33,395
 32,986
EQUITY METHOD INVESTMENTS12,318
 9,947
OTHER INVESTMENTS3,470
 3,678
OTHER ASSETS4,207
 4,407
PROPERTY, PLANT AND EQUIPMENT — net12,571
 14,633
TRADEMARKS WITH INDEFINITE LIVES5,989
 6,533
BOTTLERS' FRANCHISE RIGHTS WITH INDEFINITE LIVES6,000
 6,689
GOODWILL11,289
 12,100
OTHER INTANGIBLE ASSETS854
 1,050
TOTAL ASSETS$90,093
 $92,023
LIABILITIES AND EQUITY   
CURRENT LIABILITIES   
Accounts payable and accrued expenses$9,660
 $9,234
Loans and notes payable13,129
 19,130
Current maturities of long-term debt2,677
 3,552
Accrued income taxes331
 400
Liabilities held for sale1,133
 58
TOTAL CURRENT LIABILITIES26,930
 32,374
LONG-TERM DEBT28,407
 19,063
OTHER LIABILITIES4,301
 4,389
DEFERRED INCOME TAXES4,691
 5,636
THE COCA-COLA COMPANY SHAREOWNERS' EQUITY   
          Common stock, $0.25 par value; Authorized — 11,200 shares;
               Issued — 7,040 and 7,040 shares, respectively
1,760
 1,760
Capital surplus14,016
 13,154
Reinvested earnings65,018
 63,408
Accumulated other comprehensive income (loss)(10,174) (5,777)
Treasury stock, at cost — 2,716 and 2,674 shares, respectively(45,066) (42,225)
EQUITY ATTRIBUTABLE TO SHAREOWNERS OF THE COCA-COLA COMPANY25,554
 30,320
EQUITY ATTRIBUTABLE TO NONCONTROLLING INTERESTS210
 241
TOTAL EQUITY25,764
 30,561
TOTAL LIABILITIES AND EQUITY$90,093
 $92,023
Refer to Notes to Consolidated Financial Statements.

77



THE COCA-COLA COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year Ended December 31,2015
 2014
 2013
(In millions)   
OPERATING ACTIVITIES     
Consolidated net income$7,366
 $7,124
 $8,626
Depreciation and amortization1,970
 1,976
 1,977
Stock-based compensation expense236
 209
 227
Deferred income taxes73
 (40) 648
Equity (income) loss — net of dividends(122) (371) (201)
Foreign currency adjustments(137) 415
 168
Significant (gains) losses on sales of assets — net(374) 831
 (670)
Other operating charges929
 761
 465
Other items744
 149
 234
Net change in operating assets and liabilities(157) (439) (932)
Net cash provided by operating activities10,528
 10,615
 10,542
INVESTING ACTIVITIES     
Purchases of investments(15,831) (17,800) (14,782)
Proceeds from disposals of investments14,079
 12,986
 12,791
Acquisitions of businesses, equity method investments and nonmarketable securities(2,491) (389) (353)
Proceeds from disposals of businesses, equity method investments and nonmarketable securities565
 148
 872
Purchases of property, plant and equipment(2,553) (2,406) (2,550)
Proceeds from disposals of property, plant and equipment85
 223
 111
Other investing activities(40) (268) (303)
Net cash provided by (used in) investing activities(6,186) (7,506) (4,214)
FINANCING ACTIVITIES     
Issuances of debt40,434
 41,674
 43,425
Payments of debt(37,738) (36,962) (38,714)
Issuances of stock1,245
 1,532
 1,328
Purchases of stock for treasury(3,564) (4,162) (4,832)
Dividends(5,741) (5,350) (4,969)
Other financing activities251
 (363) 17
Net cash provided by (used in) financing activities(5,113) (3,631) (3,745)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND
     CASH EQUIVALENTS
(878) (934) (611)
CASH AND CASH EQUIVALENTS     
Net increase (decrease) during the year(1,649) (1,456) 1,972
Balance at beginning of year8,958
 10,414
 8,442
Balance at end of year$7,309
 $8,958
 $10,414
Refer to Notes to Consolidated Financial Statements.

78



THE COCA-COLA COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREOWNERS' EQUITY
Year Ended December 31,2015
 2014
 2013
(In millions except per share data)   
EQUITY ATTRIBUTABLE TO SHAREOWNERS OF THE COCA-COLA COMPANY     
    NUMBER OF COMMON SHARES OUTSTANDING
     
Balance at beginning of year4,366
 4,402
 4,469
Purchases of treasury stock(86) (98) (121)
Treasury stock issued to employees related to stock compensation plans44
 62
 54
Balance at end of year4,324
 4,366
 4,402
    COMMON STOCK
$1,760
 $1,760
 $1,760
    CAPITAL SURPLUS
     
Balance at beginning of year13,154
 12,276
 11,379
Stock issued to employees related to stock compensation plans532
 526
 569
Tax benefit (charge) from stock compensation plans94
 169
 144
Stock-based compensation236
 209
 227
Other activities
 (26) (43)
Balance at end of year14,016
 13,154
 12,276
    REINVESTED EARNINGS
     
Balance at beginning of year63,408
 61,660
 58,045
Net income attributable to shareowners of The Coca-Cola Company7,351
 7,098
 8,584
Dividends (per share — $1.32, $1.22 and $1.12 in 2015, 2014 and 2013, respectively)(5,741) (5,350) (4,969)
Balance at end of year65,018
 63,408
 61,660
    ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
     
Balance at beginning of year(5,777) (3,432) (3,385)
Net other comprehensive income (loss)(4,397) (2,345) (47)
Balance at end of year(10,174) (5,777) (3,432)
    TREASURY STOCK
     
Balance at beginning of year(42,225) (39,091) (35,009)
Stock issued to employees related to stock compensation plans696
 891
 745
Purchases of treasury stock(3,537) (4,025) (4,827)
Balance at end of year(45,066) (42,225) (39,091)
TOTAL EQUITY ATTRIBUTABLE TO SHAREOWNERS OF
   THE COCA-COLA COMPANY
$25,554
 $30,320
 $33,173
EQUITY ATTRIBUTABLE TO NONCONTROLLING INTERESTS     
Balance at beginning of year$241
 $267
 $378
Net income attributable to noncontrolling interests15
 26
 42
Net foreign currency translation adjustment(18) (5) (3)
Dividends paid to noncontrolling interests(31) (25) (58)
Acquisition of interests held by noncontrolling owners
 
 (34)
Contributions by noncontrolling interests
 
 6
Business combinations(3) (22) 25
Deconsolidation of certain entities
 
 (89)
Other activities6
 
 
TOTAL EQUITY ATTRIBUTABLE TO NONCONTROLLING INTERESTS$210
 $241
 $267
Refer to Notes to Consolidated Financial Statements.

79



THE COCA-COLA COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1: BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Description of Business
The Coca-Cola Company is the world's largest beverage company. We own or license and market more than 500 nonalcoholic beverage brands, primarily sparkling beverages but also a variety of still beverages such as waters, enhanced waters, juices and juice drinks, ready-to-drink teas and coffees, and energy and sports drinks. We own and market four of the world's top five nonalcoholic sparkling beverage brands: Coca-Cola, Diet Coke, Fanta and Sprite. Finished beverage products bearing our trademarks, sold in the United States since 1886, are now sold in more than 200 countries.
We make our branded beverage products available to consumers throughout the world through our network of Company-owned or -controlled bottling and distribution operations, as well as independent bottling partners, distributors, wholesalers and retailers — the world's largest beverage distribution system. Beverages bearing trademarks owned by or licensed to us account for more than 1.9 billion of the approximately 5758 billion servings of all beverages consumed worldwide every day.
Our Company markets, manufactures and sells:
beverage concentrates, sometimes referred to as "beverage bases," and syrups, including fountain syrups (we refer to this part of our business as our "concentrate business" or "concentrate operations"); and
finished sparkling and still beverages (we refer to this part of our business as our "finished product business" or "finished product operations").
Generally, finished product operations generate higher net operating revenues but lower gross profit margins than concentrate operations.
In our concentrate operations, we typically generate net operating revenues by selling concentrates and syrups to authorized bottling and canning operations (to which we typically refer as our "bottlers" or our "bottling partners"). Our bottling partners either combine the concentrates with sweeteners (depending on the product), still water and/or sparkling water, or combine the syrups with sparkling water to produce finished beverages. The finished beverages are packaged in authorized containers — such as cans and refillable and nonrefillable glass and plastic bottles — bearing our trademarks or trademarks licensed to us  and are then sold to retailers directly or, in some cases, through wholesalers or other bottlers. Outside the United States, we also sell concentrates for fountain beverages to our bottling partners who are typically authorized to manufacture fountain syrups, which they sell to fountain retailers such as restaurants and convenience stores which use the fountain syrups to produce beverages for immediate consumption, or to authorized fountain wholesalers who in turn sell and distribute the fountain syrups to fountain retailers.
Our finished product operations consist primarily of Company-owned or -controlled bottling, sales and distribution operations, including Coca-Cola Refreshments ("CCR")., our bottling and customer service organization for the United States and Canada. Our Company-owned or -controlled bottling, sales and distribution operations, other than CCR, are included in our Bottling Investments operating segment. CCR is included in our North America operating segment. Our finished product operations generate net operating revenues by selling sparkling beverages and a variety of still beverages, such as juices and juice drinks, energy and sports drinks, ready-to-drink teas and coffees, and certain water products, to retailers or to distributors, wholesalers and bottling partners who distribute them to retailers. In addition, in the United States, we manufacture fountain syrups and sell them to fountain retailers, such as restaurants and convenience stores who use the fountain syrups to produce beverages for immediate consumption, or to authorized fountain wholesalers or bottling partners who resell the fountain syrups to fountain retailers. In the United States, we authorize wholesalers to resell our fountain syrups through nonexclusive appointments that neither restrict us in setting the prices at which we sell fountain syrups to the wholesalers nor restrict the territories in which the wholesalers may resell in the United States.

80



Summary of Significant Accounting Policies
Basis of Presentation
Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States.States ("U.S. GAAP"). The preparation of our consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in our consolidated financial statements and accompanying notes. Although these estimates are based on our knowledge of current events and actions we may undertake in the future, actual results may ultimately differ from these estimates and assumptions.

78



Furthermore, when testing assets for impairment in future periods, if management uses different assumptions or if different conditions occur, impairment charges may result.
We use the equity method to account for investments in companies, if our investment provides us with the ability to exercise significant influence over operating and financial policies of the investee. Our consolidated net income includes our Company's proportionate share of the net income or loss of these companies. Our judgment regarding the level of influence over each equity method investment includes considering key factors such as our ownership interest, representation on the board of directors, participation in policy-making decisions and material intercompany transactions.
We eliminate from our financial results all significant intercompany transactions, including the intercompany transactions with consolidated variable interest entities ("VIEs") and the intercompany portion of transactions with equity method investees.
Principles of Consolidation
Our Company consolidates all entities that we control by ownership of a majority voting interest as well as VIEs for which our Company is the primary beneficiary. Generally, we consolidate only business enterprises that we control by ownership of a majority voting interest. However, there are situations in which consolidation is required even though the usual condition of consolidation (ownership of a majority voting interest) does not apply. Generally, this occurs when an entity holds an interest in another business enterprise that was achieved through arrangements that do not involve voting interests, which results in a disproportionate relationship between such entity's voting interests in, and its exposure to the economic risks and potential rewards of, the other business enterprise. This disproportionate relationship results in what is known as a variable interest, and the entity in which we have the variable interest is referred to as a "VIE." An enterprise must consolidate a VIE if it is determined to be the primary beneficiary of the VIE. The primary beneficiary has both (1) the power to direct the activities of the VIE that most significantly impact the entity's economic performance, and (2) the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE.
Our Company holds interests in certain VIEs, primarily bottling and container manufacturing operations, for which we were not determined to be the primary beneficiary. Our variable interests in these VIEs primarily relate to profit guarantees or subordinated financial support. Refer to Note 11. Although these financial arrangements resulted in our holding variable interests in these entities, they did not empower us to direct the activities of the VIEs that most significantly impact the VIEs' economic performance. Our Company's investments, plus any loans and guarantees, related to these VIEs totaled $2,274$2,687 million and $2,171$2,274 million as of December 31, 20142015 and 2013,2014, respectively, representing our maximum exposures to loss. The Company's investments, plus any loans and guarantees, related to these VIEs were not significant to the Company's consolidated financial statements.
In addition, our Company holds interests in certain VIEs, primarily bottling and container manufacturing operations, for which we were determined to be the primary beneficiary. As a result, we have consolidated these entities. Our Company's investments, plus any loans and guarantees, related to these VIEs totaled $266$221 million and $284$266 million as of December 31, 20142015 and 2013,2014, respectively, representing our maximum exposures to loss. The assets and liabilities of VIEs for which we are the primary beneficiary were not significant to the Company's consolidated financial statements.
Creditors of our VIEs do not have recourse against the general credit of the Company, regardless of whether they are accounted for as consolidated entities.
Assets and Liabilities Held for Sale
Our Company classifies long-lived assets or disposal groups to be sold as held for sale in the period in which all of the following criteria are met: management, having the authority to approve the action, commits to a plan to sell the asset or disposal group; the asset or disposal group is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets or disposal groups; an active program to locate a buyer and other actions required to complete the plan to sell the asset or disposal group have been initiated; the sale of the asset or disposal group is probable, and transfer of the asset or disposal group is expected to qualify for recognition as a completed sale within one year, except if events or circumstances beyond our control extend the period of time required to sell the asset or disposal group beyond one year; the asset or disposal group is being actively marketed for sale at a price that is reasonable in relation to its current fair

81



value; and actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.

79



We initially measure a long-lived asset or disposal group that is classified as held for sale at the lower of its carrying value or fair value less any costs to sell. Any loss resulting from this measurement is recognized in the period in which the held-for-sale criteria are met. Conversely, gains are not recognized on the sale of a long-lived asset or disposal group until the date of sale. We assess the fair value of a long-lived asset or disposal group less any costs to sell each reporting period it remains classified as held for sale and report any subsequent changes as an adjustment to the carrying value of the asset or disposal group, as long as the new carrying value does not exceed the carrying value of the asset at the time it was initially classified as held for sale.
Upon determining that a long-lived asset or disposal group meets the criteria to be classified as held for sale, the Company ceases depreciation and reports long-lived assets and/or the assets and liabilities of the disposal group, if material, in the line items assets held for sale and liabilities held for sale, respectively, in our consolidated balance sheet. Refer to Note 2.
Revenue Recognition
Our Company recognizes revenue when persuasive evidence of an arrangement exists, delivery of products has occurred, the sales price charged is fixed or determinable, and collectibility is reasonably assured. For our Company, this generally means that we recognize revenue when title to our products is transferred to our bottling partners, resellers or other customers. In particular, title usually transfers upon shipment to or receipt at our customers' locations, as determined by the specific sales terms of the transactions. Our sales terms do not allow for a right of return except for matters related to any manufacturing defects on our part.
Deductions from Revenue
Our customers can earn certain incentives including, but not limited to, cash discounts, funds for promotional and marketing activities, volume-based incentive programs and support for infrastructure programs. The costs associated with these incentives are included in deductions from revenue, a component of net operating revenues in our consolidated statements of income. For customer incentives that must be earned, management must make estimates related to the contractual terms, customer performance and sales volume to determine the total amounts earned and to be recorded in deductions from revenue. In making these estimates, management considers past results. The actual amounts ultimately paid may be different from our estimates.
In some situations, the Company may determine it to be advantageous to make advance payments to specific customers to fund certain marketing activities intended to generate profitable volume and/or invest in infrastructure programs with our bottlers that are directed at strengthening our bottling system and increasing unit case volume. The Company also makes advance payments to certain customers for distribution rights. The advance payments made to customers are initially capitalized and included in our consolidated balance sheets in prepaid expenses and other assets and noncurrent other assets, depending on the duration of the agreements. The assets are amortized over the applicable periods and included in deductions from revenue. The duration of these agreements typically ranges from 4range up to 10 years.
Amortization expense for infrastructure programs was $61 million, $72 million and $69 million in 2015, 2014 and $86 million in 2014, 2013, and 2012, respectively. The aggregate deductions from revenue recorded by the Company in relation to these programs, including amortization expense on infrastructure programs, were $6.8 billion, $7.0 billion and $6.9 billion in 2015, 2014 and $6.1 billion in 2014, 2013, and 2012, respectively.
Advertising Costs
Our Company expenses production costs of print, radio, television and other advertisements as of the first date the advertisements take place. All other marketing expenditures are expensed in the annual period in which the expenditure is incurred. Advertising costs included in the line item selling, general and administrative expenses in our consolidated statements of income were $3.5$4.0 billion, $3.3$3.5 billion and $3.3 billion in 2015, 2014 2013 and 2012,2013, respectively. As of December 31, 20142015 and 2013,2014, advertising and production costs of $228$207 million and $363$228 million, respectively, were primarily recorded in the line item prepaid expenses and other assets in our consolidated balance sheets.
For interim reporting purposes, we allocate our estimated full year marketing expenditures that benefit multiple interim periods to each of our interim reporting periods. We use the proportion of each interim period's actual unit case volume to the estimated full year unit case volume as the basis for the allocation. This methodology results in our marketing expenditures being recognized at a standard rate per unit case. At the end of each interim reporting period, we review our estimated full year unit case volume and our estimated full year marketing expenditures in order to evaluate if a change in estimate is necessary. The impact of any changes in these full year estimates is recognized in the interim period in which the change in estimate occurs. Our full year marketing expenditures are not impacted by this interim accounting policy.

8082



Shipping and Handling Costs
Shipping and handling costs related to the movement of finished goods from manufacturing locations to our sales distribution centers are included in the line item cost of goods sold in our consolidated statements of income. Shipping and handling costs incurred to move finished goods from our sales distribution centers to customer locations are included in the line item selling, general and administrative expenses in our consolidated statements of income. During the years ended December 31, 2015, 2014 2013 and 2012,2013, the Company recorded shipping and handling costs of $2.7$2.5 billion, $2.7 billion and $2.8$2.7 billion, respectively, in the line item selling, general and administrative expenses. Our customers do not pay us separately for shipping and handling costs related to finished goods.
Net Income Per Share
Basic net income per share is computed by dividing net income by the weighted-average number of common shares outstanding during the reporting period. Diluted net income per share is computed similarly to basic net income per share, except that it includes the potential dilution that could occur if dilutive securities were exercised. Approximately 27 million, 38 million 28 million and 3428 million stock option awards were excluded from the computations of diluted net income per share in 2015, 2014 2013 and 2012,2013, respectively, because the awards would have been antidilutive for the years presented.
Cash Equivalents
We classify time deposits and other investments that are highly liquid and have maturities of three months or less at the date of purchase as cash equivalents. We manage our exposure to counterparty credit risk through specific minimum credit standards, diversification of counterparties and procedures to monitor our credit risk concentrations.
Short-Term Investments
We classify time deposits and other investments that have maturities of greater than three months but less than one year as short-term investments.
Investments in Equity and Debt Securities
We use the equity method to account for our investments in equity securities if our investment gives us the ability to exercise significant influence over operating and financial policies of the investee. We include our proportionate share of earnings and/or losses of our equity method investees in equity income (loss) — net in our consolidated statements of income. The carrying value of our equity investments is reported in equity method investments in our consolidated balance sheets. Refer to Note 6.
We account for investments in companies that we do not control or account for under the equity method either at fair value or under the cost method, as applicable. Investments in equity securities, other than investments accounted for under the equity method, are carried at fair value if the fair value of the security is readily determinable. Equity investments carried at fair value are classified as either trading or available-for-sale securities with their cost basis determined by the specific identification method. Realized and unrealized gains and losses on trading securities and realized gains and losses on available-for-sale securities are included in other income (loss) — net in our consolidated statements of income. Unrealized gains and losses, net of deferred taxes, on available-for-sale securities are included in our consolidated balance sheets as a component of accumulated other comprehensive income (loss) ("AOCI"), except for the change in fair value attributable to the currency risk being hedged, if applicable, which is included in other income (loss) — net in our consolidated statements of income. Trading securities are reported as either marketable securities or other assets in our consolidated balance sheets. Securities classified as available-for-sale are reported as either marketable securities, other investments or other assets in our consolidated balance sheets, depending on the length of time we intend to hold the investment. Refer to Note 3.
Investments in equity securities that we do not control or account for under the equity method and do not have readily determinable fair values for are accounted for under the cost method. Cost method investments are originally recorded at cost, and we record dividend income when applicable dividends are declared. Cost method investments are reported as other investments in our consolidated balance sheets, and dividend income from cost method investments is reported in the line item other income (loss) — net in our consolidated statements of income.
Our investments in debt securities are carried at either amortized cost or fair value. Investments in debt securities that the Company has the positive intent and ability to hold to maturity are carried at amortized cost and classified as held-to-maturity. Investments in debt securities that are not classified as held-to-maturity are carried at fair value and classified as either trading or available-for-sale.

8183



Each reporting period we review all of our investments in equity and debt securities, except for those classified as trading, to determine whether a significant event or change in circumstances has occurred that may have an adverse effect on the fair value of each investment. When such events or changes occur, we evaluate the fair value compared to our cost basis in the investment. We also perform this evaluation every reporting period for each investment for which our cost basis exceeded the fair value in the prior period.value. The fair values of most of our investments in publicly traded companies are often readily available based on quoted market prices. For investments in nonpublicly traded companies, management's assessment of fair value is based on valuation methodologies including discounted cash flows, estimates of sales proceeds, and appraisals, as appropriate. We consider the assumptions that we believe hypothetical marketplace participants would use in evaluating estimated future cash flows when employing the discounted cash flow or estimates of sales proceeds valuation methodologies.
In the event the fair value of an investment declines below our cost basis, management determinesis required to determine if the decline in fair value is other than temporary. If management determines the decline is other than temporary, an impairment charge is recorded. Management's assessment as to the nature of a decline in fair value is based on, among other things, the length of time and the extent to which the market value has been less than our cost basis,basis; the financial condition and near-term prospects of the issuer,issuer; and our intent and ability to retain the investment for a period of time sufficient to allow for any anticipated recovery in market value.
Trade Accounts Receivable
We record trade accounts receivable at net realizable value. This value includes an appropriate allowance for estimated uncollectible accounts to reflect any loss anticipated on the trade accounts receivable balances and charged to the provision for doubtful accounts. We calculate this allowance based on our history of write-offs, the level of past-due accounts based on the contractual terms of the receivables, and our relationships with, and the economic status of, our bottling partners and customers. We believe our exposure to concentrations of credit risk is limited due to the diverse geographic areas covered by our operations. Activity in the allowance for doubtful accounts was as follows (in millions):
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
Balance at beginning of year$61
 $53
 $83
$331
 $61
 $53
Net charges to costs and expenses1
308
 30
 5
45
 308
 30
Write-offs(13) (14) (19)(10) (13) (14)
Other2
(25) (8) (16)(14) (25) (8)
Balance at end of year$331
 $61
 $53
$352
 $331
 $61
1 
The increase in 2014 was primarily related to concentrate sales receivables from our bottling partner in Venezuela. See Hyperinflationary Economies discussion below for additional information.
2 Other includes foreign currency translation and the impact of transferring certain assets to assets held for sale. See Note 2.
A significant portion of our net operating revenues and corresponding accounts receivable is derived from sales of our products in international markets. Refer to Note 19. We also generate a significant portion of our net operating revenues by selling concentrates and syrups to bottlers in which we have a noncontrolling interest, including Coca-Cola FEMSA, S.A.B. de C.V. ("Coca-Cola FEMSA"), Coca-Cola HBC AG ("Coca-Cola Hellenic"), and Coca-Cola Amatil Limitedİçecek A.Ş. ("Coca-Cola Amatil"İçecek"). Refer to Note 6.
Inventories
Inventories consist primarily of raw materials and packaging (which includes ingredients and supplies) and finished goods (which include concentrates and syrups in our concentrate operations and finished beverages in our finished product operations). Inventories are valued at the lower of cost or market. We determine cost on the basis of the average cost or first-in, first-out methods. Refer to Note 4.
Derivative Instruments
Our Company, when deemed appropriate, uses derivatives as a risk management tool to mitigate the potential impact of certain market risks. The primary market risks managed by the Company through the use of derivative instruments are foreign currency exchange rate risk, commodity price risk and interest rate risk. All derivatives are carried at fair value in our consolidated balance sheets in the following line items, as applicable: prepaid expenses and other assets; other assets; or accounts payable and accrued expenses; and other liabilities, as applicable.liabilities. The cash flow impact of the Company's derivative instruments is primarily included in our consolidated statements of cash flows in net cash provided by operating activities. Refer to Note 5.

8284



Property, Plant and Equipment
Property, plant and equipment are stated at cost. Repair and maintenance costs that do not improve service potential or extend economic life are expensed as incurred. Depreciation is recorded principally by the straight-line method over the estimated useful lives of our assets, which are reviewed periodically and generally have the following ranges: buildings and improvements: 40 years or less; and machinery, equipment and vehicle fleet: 20 years or less. Land is not depreciated, and construction in progress is not depreciated until ready for service. Leasehold improvements are amortized using the straight-line method over the shorter of the remaining lease term, including renewals that are deemed to be reasonably assured, or the estimated useful life of the improvement. Depreciation is not recorded during the period in which a long-lived asset or disposal group is classified as held for sale, even if the asset or disposal group continues to generate revenue during the period. Depreciation expense, including the depreciation expense of assets under capital lease, totaled $1,735 million, $1,716 million and $1,727 million in 2015, 2014 and $1,704 million in 2014, 2013, and 2012, respectively. Amortization expense for leasehold improvements totaled $18 million, $20 million and $16 million in 2015, 2014 and $19 million in 2014, 2013, and 2012, respectively.
Certain events or changes in circumstances may indicate that the recoverability of the carrying amount of property, plant and equipment should be assessed, including, among others, a significant decrease in market value, a significant change in the business climate in a particular market, or a current period operating or cash flow loss combined with historical losses or projected future losses. When such events or changes in circumstances are present, we estimate the future cash flows expected to result from the use of the asset or asset group and its eventual disposition. These estimated future cash flows are consistent with those we use in our internal planning. If the sum of the expected future cash flows (undiscounted and without interest charges) is less than the carrying amount, we recognize an impairment loss. The impairment loss recognized is the amount by which the carrying amount exceeds the fair value. We use a variety of methodologies to determine the fair value of property, plant and equipment, including appraisals and discounted cash flow models, which are consistent with the assumptions we believe hypothetical marketplace participants would use. Refer to Note 7.
Goodwill, Trademarks and Other Intangible Assets
We classify intangible assets into three categories: (1) intangible assets with definite lives subject to amortization, (2) intangible assets with indefinite lives not subject to amortization and (3) goodwill. We determine the useful lives of our identifiable intangible assets after considering the specific facts and circumstances related to each intangible asset. Factors we consider when determining useful lives include the contractual term of any agreement related to the asset, the historical performance of the asset, the Company's long-term strategy for using the asset, any laws or other local regulations which could impact the useful life of the asset, and other economic factors, including competition and specific market conditions. Intangible assets that are deemed to have definite lives are amortized, primarily on a straight-line basis, over their useful lives, generally ranging from 1 to 20 years. Refer to Note 8.
When facts and circumstances indicate that the carrying value of definite-lived intangible assets may not be recoverable, management assesses the recoverability of the carrying value by preparing estimates of sales volume and the resulting profit and cash flows. These estimated future cash flows are consistent with those we use in our internal planning. If the sum of the expected future cash flows (undiscounted and without interest charges) is less than the carrying amount, we recognize an impairment loss. The impairment loss recognized is the amount by which the carrying amount of the asset or asset group exceeds the fair value. We use a variety of methodologies to determine the fair value of these assets, including discounted cash flow models, which are consistent with the assumptions we believe hypothetical marketplace participants would use.
We test intangible assets determined to have indefinite useful lives, including trademarks, franchise rights and goodwill, for impairment annually, or more frequently if events or circumstances indicate that assets might be impaired. Our Company performs these annual impairment reviews as of the first day of our third fiscal quarter. We use a variety of methodologies in conducting impairment assessments of indefinite-lived intangible assets, including, but not limited to, discounted cash flow models, which are based on the assumptions we believe hypothetical marketplace participants would use. For indefinite-lived intangible assets, other than goodwill, if the carrying amount exceeds the fair value, an impairment charge is recognized in an amount equal to that excess.
The Company has the option to perform a qualitative assessment of indefinite-lived intangible assets, other than goodwill, prior to completing the impairment test described above. The Company must assess whether it is more likely than not that the fair value of the intangible asset is less than its carrying amount. If the Company concludes that this is the case, it must perform the testing described above. Otherwise, the Company does not need to perform any further assessment. During 2014,2015, the Company performed qualitative assessments on less than 1025 percent of our indefinite-lived intangible assets balance.

8385



We perform impairment tests of goodwill at our reporting unit level, which is one level below our operating segments. Our operating segments are primarily based on geographic responsibility, which is consistent with the way management runs our business. Our operating segments are subdivided into smaller geographic regions or territories that we sometimes refer to as "business units." These business units are also our reporting units. The Bottling Investments operating segment includes all Company-owned or consolidated bottling operations, regardless of geographic location, except for bottling operations managed by CCR, which are included in our North America operating segment. Generally, each Company-owned or consolidated bottling operation within our Bottling Investments operating segment is its own reporting unit. Goodwill is assigned to the reporting unit or units that benefit from the synergies arising from each business combination.
The goodwill impairment test consists of a two-step process, if necessary. The first step is to compare the fair value of a reporting unit to its carrying value, including goodwill. We typically use discounted cash flow models to determine the fair value of a reporting unit. The assumptions used in these models are consistent with those we believe hypothetical marketplace participants would use. If the fair value of the reporting unit is less than its carrying value, the second step of the impairment test must be performed in order to determine the amount of impairment loss, if any. The second step compares the implied fair value of the reporting unit's goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit's goodwill exceeds its implied fair value, an impairment charge is recognized in an amount equal to that excess. The loss recognized cannot exceed the carrying amount of goodwill.
The Company has the option to perform a qualitative assessment of goodwill prior to completing the two-step process described above to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill and other intangible assets. If the Company concludes that this is the case, it must perform the two-step process. Otherwise, the Company will forego the two-step process and does not need to perform any further testing. During 2014,2015, the Company performed qualitative assessments on less than 10 percent of our consolidated goodwill balance.
Impairment charges related to intangible assets are generally recorded in the line item other operating charges or, to the extent they relate to equity method investees, in the line item equity income (loss) — net in our consolidated statements of income.
Contingencies
Our Company is involved in various legal proceedings and tax matters. Due to their nature, such legal proceedings and tax matters involve inherent uncertainties including, but not limited to, court rulings, negotiations between affected parties and governmental actions. Management assesses the probability of loss for such contingencies and accrues a liability and/or discloses the relevant circumstances, as appropriate. Refer to Note 11.
Stock-Based Compensation
Our Company sponsors equity plans that provide for the grant of awards including stock option andoptions, restricted stock award plans.units, restricted stock and performance share units. The fair value of our stock option grants is estimated on the grant date using a Black-Scholes-Merton option-pricing model. The Company recognizes compensation expense on a straight-line basis over the period the grant is earned by the employee, generally four years.
The fair value of our restricted stock awardsunits, restricted stock and certain performance share units is the quoted market value of the Company's stock on the grant date less the present value of the expected dividends not received during the relevant holding period. For certain restricted stock awardsperformance share units granted beginning in 2014, the Company includes a relative total shareowner return ("TSR") modifier to determine the number of restricted shares or share units earned at the end of the performance period. For these awards, the number of restricted shares or share units earned based on the certified achievement of the predefined performance criteria will be reduced or increased if total shareowner return over the performance period relative to a predefined compensation comparator group of companies falls outside of a defined range. The fair value of performance share units that include the TSR modifier is determined using a Monte Carlo valuation model.
In the period it becomes probable that the minimum performance criteria specified in the restricted stockperformance share award plan will be achieved, we recognize expense for the proportionate share of the total fair value of the award related to the vesting period that has already lapsed. The remaining fair value of the award is expensed on a straight-line basis over the balance of the vesting period. In the event the Company determines it is no longer probable that we will achieve the minimum performance criteria specified in the plan, we reverse all of the previously recognized compensation expense in the period such a determination is made. Refer to Note 12.
Pension and Other Postretirement Benefit Plans
Our Company sponsors and/or contributes to pension and postretirement health care and life insurance benefit plans covering substantially all U.S. employees. We also sponsor nonqualified, unfunded defined benefit pension plans for certain associates and participate in multi-employer pension plans in the United States. In addition, our Company and its subsidiaries have various pension plans and other forms of postretirement arrangements outside the United States. Refer to Note 13.

8486



Income Taxes
Income tax expense includes United States, state, local and international income taxes, plus a provision for U.S. taxes on undistributed earnings of foreign subsidiaries not deemed to be indefinitely reinvested. Deferred tax assets and liabilities are recognized for the tax consequences of temporary differences between the financial reporting basis and the tax basis of existing assets and liabilities. The tax rate used to determine the deferred tax assets and liabilities is the enacted tax rate for the year and manner in which the differences are expected to reverse. Valuation allowances are recorded to reduce deferred tax assets to the amount that will more likely than not be realized. The Company records taxes that are collected from customers and remitted to governmental authorities on a net basis in our consolidated statements of income.
The Company is involved in various tax matters, with respect to some of which the outcome is uncertain. We establish reserves to remove some or all of the tax benefit of any of our tax positions at the time we determine that it becomes uncertain based upon one of the following conditions: (1) the tax position is not "more likely than not" to be sustained, (2) the tax position is "more likely than not" to be sustained, but for a lesser amount, or (3) the tax position is "more likely than not" to be sustained, but not in the financial period in which the tax position was originally taken. For purposes of evaluating whether or not a tax position is uncertain, (1) we presume the tax position will be examined by the relevant taxing authority that has full knowledge of all relevant information; (2) the technical merits of a tax position are derived from authorities such as legislation and statutes, legislative intent, regulations, rulings and case law and their applicability to the facts and circumstances of the tax position; and (3) each tax position is evaluated without consideration of the possibility of offset or aggregation with other tax positions taken. A number of years may elapse before a particular uncertain tax position is audited and finally resolved or when a tax assessment is raised. The number of years subject to tax assessments varies depending on the tax jurisdiction. The tax benefit that has been previously reserved because of a failure to meet the "more likely than not" recognition threshold would be recognized in our income tax expense in the first interim period when the uncertainty disappears under any one of the following conditions: (1) the tax position is "more likely than not" to be sustained, (2) the tax position, amount, and/or timing is ultimately settled through negotiation or litigation, or (3) the statute of limitations for the tax position has expired. Refer to Note 11 and Note 14.
Translation and Remeasurement
We translate the assets and liabilities of our foreign subsidiaries from their respective functional currencies to U.S. dollars at the appropriate spot rates as of the balance sheet date. Generally, our foreign subsidiaries use the local currency as their functional currency. Changes in the carrying value of these assets and liabilities attributable to fluctuations in spot rates are recognized in foreign currency translation adjustment, a component of AOCI. Refer to Note 15. Income statement accounts are translated using the monthly average exchange rates during the year.
Monetary assets and liabilities denominated in a currency that is different from a reporting entity's functional currency must first be remeasured from the applicable currency to the legal entity's functional currency. The effect of this remeasurement process is recognized in the line item other income (loss) — net in our consolidated statements of income and is partially offset by the impact of our economic hedging program for certain exposures on our consolidated balance sheets. Refer to Note 5.
Hyperinflationary Economies
A hyperinflationary economy is one that has cumulative inflation of 100 percent or more over a three-year period. In accordance with accounting principles generally accepted in the United States,U.S. GAAP, local subsidiaries in hyperinflationary economies are required to use the U.S. dollar as their functional currency and remeasure the monetary assets and liabilities not denominated in U.S. dollars using the rate applicable to conversion of a currency for purposes of dividend remittances. All exchange gains and losses resulting from remeasurement are recognized currently in income.
Venezuela has been designated as a hyperinflationary economy. In February 2013, the Venezuelan government devalued its currency to an official rate of exchange ("official rate") of 6.3 bolivars per U.S. dollar. At that time, the Company remeasured the net monetary assets of our Venezuelan subsidiary at the official rate. As a result of the devaluation, we recognized a loss of $140 million from remeasurement in the line item other income (loss) — net in our consolidated statement of income.
Beginning in the first quarter of 2014, the Venezuelan government recognized three legal exchange rates to convert bolivars to the U.S. dollar: 1)(1) the official rate of 6.3 bolivars per U.S. dollar; 2)(2) SICAD 1, which iswas available to foreign investments and designated industry sectors to exchange a limited volume of bolivars for U.S. dollars using a bid rate established at weekly auctions; and 3)(3) SICAD 2, which appliesapplied to transactions that dodid not qualify for either the official rate or SICAD 1. As of March 28, 2014, the three legal exchange rates were 6.3 (official rate), 10.8 (SICAD 1) and 50.9 (SICAD 2). We determined that the SICAD 1 rate was the most appropriate rate to use for remeasurement given our circumstances and estimates of the applicable rate at which future transactions could be settled, including the payment of dividends. Therefore, as of March 28, 2014, we remeasured the net monetary assets of our Venezuelan subsidiary using an exchange rate of 10.8 bolivars per U.S.

87



dollar, resulting in a charge of $226 million recorded in the line item other income (loss) — net in our consolidated statement of income.

85



In December 2014, due to the continued lack of liquidity and increasing economic uncertainty, the Company reevaluated the rate that should be used to remeasure the monetary assets and liabilities of our Venezuelan subsidiary. As of December 31, 2014, we determined that the SICAD 2 rate of 50 bolivars per U.S. dollar was the most appropriate legally available rate and remeasured the net monetary assets of our Venezuelan subsidiary, resulting in a charge of $146 million recorded in the line item other income (loss) — net in our consolidated statement of income.
In February 2015, the Venezuelan government merged SICAD 1 and SICAD 2 into a single mechanism called SICAD and introduced a new open market exchange rate system, SIMADI. As a result, management determined that the SIMADI rate was the most appropriate legally available rate and remeasured the net monetary assets of our Venezuelan subsidiary, resulting in a charge of $27 million recorded in the line item other income (loss) — net in our consolidated statement of income.
In addition to the foreign currency exchange exposure related to our Venezuelan subsidiary's net monetary assets, we also sell concentrate to our bottling partner in Venezuela from outside the country. These sales are denominated in U.S. dollars. During the yearyears ended December 31, 2015 and December 31, 2014, as a result of the continued lack of liquidity and our revised assessment of the U.S. dollar value we expect to realize upon the conversion of Venezuelan bolivars into U.S. dollars by our bottling partner to pay our concentrate sales receivables, we recorded a write-downwrite-downs of $56 million and $296 million, respectively, recorded in the line item other operating charges in our consolidated statementstatements of income.
We also have certain U.S. dollar denominated intangible assets associated with products sold in Venezuela. In January 2014, the Venezuelan government enacted a new law which imposes limits on profit margins earned in the country, reducing the Company's cash flows for as long as the law remains in effect. As a result of this law and the Company's revised expectations regarding the convertibility of the local currency, we recognized an impairment chargecharges of $55 million and $18 million, respectively, during the yearyears ended December 31, 2014,2015 and December 31, 2014. These charges were recorded in the line item other operating charges in our consolidated statementstatements of income. Further government regulation or changes in exchange rates could result in additional impairments
During the year ended December 31, 2015, the Company continued to use the SIMADI rate to remeasure the net monetary assets of these intangible assets.
our Venezuelan subsidiary. As of December 31, 2014,2015, the combined value of the net monetary assets of our Venezuelan subsidiary, the concentrate sales receivables from our bottling partner in Venezuela and the intangible assets associated with products sold in Venezuela was $180$100 million. Included in this combined value is $52$15 million of cash and cash equivalents. Despite the additional currency conversion mechanisms, the Company's ability to pay dividends from Venezuela is still restricted due to the low volume of U.S. dollars available for conversion. If
In February 2016, the bolivar devalues further,Venezuelan government devalued its currency and changed its official and most preferential exchange rate, which will continue to be used for purchases of certain essential goods, to 10 bolivars per U.S. dollar from 6.3. The Venezuelan government announced it would likelywill reduce its three-tier system of exchange rates to two tiers by eliminating the SICAD rate. Additionally, the government announced that the SIMADI rate will be allowed to float freely beginning at a rate of 203 bolivars per U.S. dollar. As a result, in ourthe Company recognizing additionalexpects to continue to record losses on foreign currency exchange, losses,may incur additional write-downs of receivables or impairment charges and will continue to record our proportionate share of any charges recorded by our equity method investee.investee that has operations in Venezuela.
Recently Issued Accounting Guidance
In AprilMay 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. Under ASU 2014-08, only disposals representing a strategic shift in operations should be presented as discontinued operations. Those strategic shifts should have a major effect on the organization's operations and financial results. Additionally, ASU 2014-08 requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income and expenses of discontinued operations. ASU 2014-08 is effective for fiscal and interim periods beginning on or after December 15, 2014. The impact on our consolidated financial statements will depend on the facts and circumstances of any specific future transactions.
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, which will replace most existing revenue recognition guidance in U.S. Generally Accepted Accounting PrinciplesGAAP and is intended to improve and converge with international standards the financial reporting requirements for revenue from contracts with customers. The core principle of ASU 2014-09 is that an entity should recognize revenue for the transfer of goods or services equal to the amount that it expects to be entitled to receive for those goods or services. ASU 2014-09 also requires additional disclosures about the nature, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments. ASU 2014-09 allows for both retrospective and prospective methods of adoption and iswill be effective for periodsthe Company beginning after December 15, 2016.January 1, 2018. The Company is currently evaluating the impact that the adoption of ASU 2014-09 will have on our consolidated financial statements.
In February 2015, the FASB issued ASU 2015-02, Amendments to the Consolidation Analysis, which changes the guidance for evaluating whether to consolidate certain legal entities. Specifically, the amendments modify the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities. Additionally, the amendments eliminate the presumption that a general partner should consolidate a limited partnership and affect the consolidation analysis of reporting entities that are involved with VIEs, particularly those that have fee arrangements and related party relationships. ASU 2015-02 will be effective for the Company beginning January 1, 2016. Companies have an option of using either a full retrospective or modified retrospective adoption approach. The Company does not believe that the adoption of ASU 2015-02 will have a material impact on the Company's financial position, results of operations or cash flows.

8688



In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs, which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability. The standard will be effective for the Company beginning January 1, 2016 and will be applied retrospectively. The Company expects that the only impact of the adoption of ASU 2015-03 on our consolidated financial statements will be the change in balance sheet presentation of our debt issuance costs.

In April 2015, the FASB issued ASU 2015-07, Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent). This amendment removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share. This guidance will be effective for the Company beginning January 1, 2016. The Company expects that the implementation of this amendment will impact the Company's notes to the consolidated financial statements but will not have an effect on the Company's financial position or results of operations.
In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. The amendments in this update simplify the presentation of deferred income taxes and require that deferred tax liabilities and assets be classified as noncurrent in a consolidated statement of financial position. These amendments may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. The amendments will be effective for the Company beginning January 1, 2017. Earlier application is permitted for all entities as of the beginning of an interim or annual reporting period.
NOTE 2: ACQUISITIONS AND DIVESTITURES
Acquisitions
During 2015, our Company's acquisitions of businesses, equity method investments and nonmarketable securities totaled $2,491 million, which primarily related to our strategic partnership with Monster Beverage Corporation ("Monster") and an investment in a bottling partner in Indonesia that is accounted for under the equity method of accounting. The bottling partner in Indonesia is a subsidiary of Coca-Cola Amatil Limited, an equity method investee. We also acquired the remaining outstanding shares of a bottling partner in South Africa ("South African bottler"), which was previously accounted for as an equity method investment. We remeasured our previously held equity interest in the South African bottler to fair value upon the close of the transaction and recorded a loss on the remeasurement of $19 million during the year ended December 31, 2015. This bottler will be included in the Coca-Cola Beverages Africa Limited transaction discussed further below.
During 2014, our Company's acquisitions of businesses, equity method investments and nonmarketable securities totaled $389 million and primarily included a joint investment with one of our bottling partners in a dairy company in Ecuador, which is accounted for under the equity method of accounting.
During 2013, our Company's acquisitions of businesses, equity method investments and nonmarketable securities totaled $353 million, which primarily included our acquisition of the majority of the remaining outstanding shares of Fresh Trading Ltd. ("innocent") and a majority interest in bottling operations in Myanmar. The Company previously accounted for our investment in innocent under the equity method of accounting. We remeasured our equity interest in innocent to fair value upon the close of the transaction. The resulting gain on the remeasurement was not significant to our consolidated financial statements.
Monster Beverage Corporation
On August 14, 2014, the Company and Monster entered into definitive agreements for a long-term strategic relationship in the global energy drink category. The transaction contemplated under these agreements ("Monster Transaction") closed on June 12, 2015. As a result of the Monster Transaction, (1) the Company purchased newly issued shares of Monster common stock representing approximately 17 percent of the outstanding shares of Monster common stock (after giving effect to the new issuance); (2) the Company sold its global energy drink business (including NOS, Full Throttle, Burn, Mother, Play and Power Play, and Relentless) to Monster, and the Company acquired Monster's non-energy drink business (including Hansen's Natural Sodas, Peace Tea, Hubert's Lemonade and Hansen's Juice Products); and (3) the parties amended their distribution coordination agreements to expand distribution of Monster products into additional territories pursuant to long-term agreements with the Company's existing network of Company-owned or -controlled bottling operations and distribution partners. The Coca-Cola system also became Monster's preferred global distribution partner. The Company made a net cash payment of $2,150 million to Monster, of which $125 million is being held in escrow, subject to release upon achievement of milestones relating to the transfer of Monster's domestic distribution rights to our distribution network.

89



The Monster Transaction consisted of multiple elements including the purchase of common stock, the acquisition and divestiture of businesses and the expansion of distribution territories. When consideration transferred is not solely in the form of cash, measurement is based on either the cost to the acquiring entity (the fair value of the assets given) or the fair value of the assets acquired, whichever is more clearly evident and, thus, more reliably measurable. As the majority of the consideration transferred was cash, we believe the fair value of the consideration transferred is more reliably measurable. The consideration transferred consists of $2,150 million of cash (including $125 million in escrow) and the fair value of our global energy business of $2,046 million, which we determined using discounted cash flow analyses, resulting in total consideration transferred of $4,196 million. As such, we have allocated the total consideration transferred to the individual assets and business acquired based on a relative fair value basis, using the closing date fair values of each element, as follows (in millions):
 June 12, 2015
Equity investment in Monster$3,066
Expansion of distribution territories1,035
Monster non-energy drink business95
Total assets and business acquired$4,196

In addition to our ownership interest in Monster's outstanding common stock, the Company is represented by two directors on Monster's 10 member Board of Directors. Based on our equity ownership percentage, the significance that our expanded distribution and coordination agreements have on Monster's operations, and our representation on Monster's Board of Directors, the Company is accounting for its interest in Monster as an equity method investment.
As a result of the Monster Transaction, the North America Coca-Cola system obtained the right to distribute Monster products in territories for which it was not previously the authorized distributor ("expanded territories"). These distribution rights are governed by an agreement with an initial term of 20 years, after which it will continue to remain in effect unless otherwise terminated by either party and there are no future costs of renewal. As such, these rights were determined to be indefinite-lived intangible assets and are classified in the line item bottlers' franchise rights with indefinite lives in our consolidated balance sheet. CCR is the distributor in the majority of the expanded territories. The remainder of the territories are serviced by independent bottling partners. Of the $1,035 million allocated to the expanded distribution rights, the Company derecognized $341 million related to the expanded territories serviced by the independent bottling partners upon the close of the transaction. As consideration for these rights, the Company received an up-front payment of $28 million related to these territories, and we will receive a payment per case on all future sales made by these independent bottlers for the duration of the distribution agreements. As these payments are dependent on future sales, they are a form of contingent consideration. We elected to account for this consideration in the same manner as the contingent consideration to be received in the North America refranchising, discussed below. This resulted in a net loss of $313 million recorded in the line item other income (loss) — net in our consolidated statement of income during the year ended December 31, 2015.
During 2012,the year ended December 31, 2015, the Company recognized a gain of $1,715 million on the sale of our Company'sglobal energy drink business, primarily due to the difference in the recorded carrying value of the assets transferred, including an allocated portion of goodwill, compared to the value of the total assets and business acquired. After considering the loss resulting from the derecognition of the expanded territory rights serviced by the independent bottling partners, the net gain recognized on the Monster Transaction was $1,403 million, which was recorded in the line item other income (loss) — net in our consolidated statement of income. Additionally, under the terms of the Monster Transaction, we were required to discontinue selling energy products under certain trademarks, including one trademark in the glacéau portfolio. The Company recognized an impairment charge of $380 million upon closing, primarily related to the discontinuation of the energy products in the glacéau portfolio, which was recorded in the line item other operating charges in our consolidated statement of income.
During the year ended December 31, 2015, based on the relative fair values of the total assets and business acquired, $1,620 million of the $2,150 million cash payment made was classified in the line item acquisitions of businesses, equity method investments and nonmarketable securities totaled $1,486 million. These payments were primarily related to the following:in our investmentsconsolidated statement of cash flows. The remaining $530 million was classified in the existing beverage businessline item other investing activities in our consolidated statement of Aujan Industries Company J.S.C. ("Aujan"), one of the largest independent beverage companies in the Middle East; our investment in Mikuni Coca-Cola Bottling Co., Ltd. ("Mikuni"), a bottling partner located in Japan; our acquisition of Sacramento Coca-Cola Bottling Co., Inc. ("Sacramento bottler"); and our acquisition of bottling operations in Vietnam, Cambodia and Guatemala. The Company's investment in Mikuni was accounted for under the equity method of accounting prior to 2013, when this investment was merged with three other bottlers to form Coca-Cola East Japan Bottling Company, Ltd. ("CCEJ"). Refer to Note 17 for details on this transaction. The Company paid $820 million during 2012 under its definitive agreement with Aujan in exchange for an ownership interest of 50 percent in the entity that holds the rights in certain territories to brands produced and distributed by Aujan and an ownership interest of 49 percent in Aujan's bottling and distribution operations in certain territories. The Company's investments in Aujan are being accounted for under the equity method of accounting.cash flows.

90



Keurig Green Mountain, Coffee Roasters, Inc.
In February 2014, the Company and Green Mountain Coffee Roasters, Inc., now known aspurchased newly issued shares in Keurig Green Mountain, Inc. ("Keurig"), entered into a 10-year global strategic agreement to collaborate on the development and introduction of the Company’s global brand portfolio for use in Keurig’s forthcoming Keurig KoldTM at-home beverage system. Under the agreement, the companies will cooperate to bring the Keurig KoldTM beverage system to consumers around the world, and Keurig will be the Company's exclusive partner for the production and sale of our branded single-serve, pod-based cold beverages. Together we will also explore future opportunities to collaborate on the Keurig® platform. In an effort to align long-term interests, we also entered into an agreement to purchase a 10 percent equity position in Keurig, and on February 27, 2014, the Company purchased the newly issued shares in Keurig for approximately $1,265 million, including transaction costs of $14 million.
In May 2014, the Company purchased additional shares of Keurig in the market for $302 million, which represented an additional 2 percent equity position in Keurig. We account for the investment in Keurig as an available-for-sale security, which is included in the line item other investments in our consolidated balance sheet. These purchases were included in the line item purchases of investments in our consolidated statement of cash flows.
Subsequent to these purchases, the Company entered into an agreement with Credit Suisse Capital LLC ("CS") to purchase additional shares of Keurig which would increase the Company's equity position to a 16 percent interest based on the total number of issued and outstanding shares of Keurig as of May 1, 2014. Under the agreement, the Company willwas to purchase from CS, on a date selected by CS no later than February 2015, the lesser of (1) 6.5 million shares of Keurig or (2) the number of shares that shall cause our ownership to equal 16 percent. The purchase price per share will bewas the average of the daily volume-weighted average price per share from May 15, 2014, to the date selected by CS, as adjusted in certain circumstances specified in the agreement. CS will havehad exclusive ownership and control over any such shares until delivered to the Company. ThisIn February 2015, the Company purchased 6.4 million shares from CS under this agreement with CS qualifiesfor a total purchase price of $830 million. As this agreement qualified as a derivative, andwe recognized a loss of $58 million in the changesline item other income (loss) — net in its fair value are immediatelyour consolidated statement of income during the year ended December 31, 2015. The Company recognized into earnings.a cumulative loss of $47 million in the line item other income (loss) — net in our consolidated statement of income over the term of the agreement.
Coca-Cola Erfrischungsgetränke AGWe account for the investment in Keurig as an available-for-sale security, which is included in the line item other investments in our consolidated balance sheet. These purchases of the shares were included in the line item purchases of investments in our consolidated statement of cash flows, net of any related derivative impact.
German Bottling Operations
In conjunction with the Company's acquisition of 18 German bottling and distribution operations in 2007, the former owners received put options to sell their respective shares in Coca-Cola Erfrischungsgetränke AG ("CCEAG")the operations back to the Company in January 2014. TheDuring the year ended December 31, 2014, the Company paid $503 million to purchase these shares, which was included in the line item other financing activities in our consolidated statement of cash flows, resulting in 100 percent ownership of CCEAG.our German bottling operations.

87



Divestitures
During 2015, proceeds from disposals of businesses, equity method investments and nonmarketable securities totaled $565 million, which included proceeds from the refranchising of certain of our territories in North America and proceeds from the sale of a 10 percent interest in a Brazilian bottling partner as a result of the majority owners exercising their right to acquire additional shares from us.
During 2014, proceeds from disposals of businesses, equity method investments and nonmarketable securities totaled $148 million, which primarily represented the proceeds from the refranchising of certain of our territories in North America.
During 2013, proceeds from disposals of businesses, equity method investments and nonmarketable securities totaled $872 million. These proceeds primarily included the sale of a majority ownership interest in our previously consolidated bottling operations in the Philippines ("Philippine bottling operations"), and separately, the deconsolidation of our bottling operations in Brazil ("Brazilian bottling operations").
North America Refranchising
In conjunction with implementing a new beverage partnership model in North America, the Company refranchised territories that were previously managed by CCR to certain of our unconsolidated bottling partners. These territories generally border these bottlers' existing territories, allowing each bottler to better service local customers and provide more efficient execution. Through the execution ofBy entering into comprehensive beverage agreements ("CBAs") with each of the bottlers, we granted certain exclusive territory rights for the distribution, promotion, marketing and sale of Company-owned and licensed beverage products as defined by the CBA. UnderIn some cases, the arrangementCompany has entered into, or agreed to enter into, manufacturing agreements that authorize certain bottlers that have executed a CBA to manufacture certain beverage products. If a bottler has not entered into a specific manufacturing agreement, then under the CBA for these territories, CCR retains the rights to produce these beverage products and the bottlers will purchase from CCR (or other Company-authorized manufacturing bottlers) substantially all of the related finished products needed in order to service the customers in these territories.

91



Each CBA generally has a term of 10 years and is renewable, in most cases by the bottler and in some cases by the Company, indefinitely for successive additional terms of 10 years each. Under the CBA, the bottlers will make ongoing quarterly payments to CCRthe Company based on their future gross profit in thesethe refranchised territories throughout the term of the CBA, including renewals, in exchange for the grant of the exclusive territory rights.
Contemporaneously with the grant of these rights, the Company sold the distribution assets, certain working capital items, and the exclusive rights to distribute certain beverage brands not owned by the Company, but distributed by CCR, in each of these territories to the respective bottlers in exchange for cash. These rights include, where applicable, the recently acquired Monster distribution rights discussed above. During the yearyears ended December 31, 2015 and December 31, 2014, cash proceeds from these sales totaled $362 million and $143 million, which includedrespectively. Included in the cash proceeds offor the years ended December 31, 2015 and December 31, 2014 was $83 million and $42 million, respectively, from Coca-Cola Bottling Co. Consolidated, an equity method investee. Under the applicable accounting guidance, we were required to derecognize all of the tangible assets sold as well as the intangible assets transferred, including distribution rights, customer relationships and an allocated portion of goodwill related to these territories.
Additionally, in September 2015, the Company announced the formation of a new National Product Supply System ("NPSS") which will facilitate optimal operation of the U.S. product supply system. Under the NPSS, the Company and several of its existing independent producing bottlers will administer key national product supply activities for these bottlers, which currently represent approximately 95 percent of the U.S. produced volume. As part of the NPSS, it is anticipated that each of these bottlers will acquire certain production facilities from CCR in exchange for cash, subject to the parties reaching definitive agreements. The transition of these production facilities is anticipated to take place by the end of 2017.
We recognized a noncash losslosses of $305$1,006 million and $799 million during the yearyears ended December 31, 2015 and December 31, 2014, respectively. These losses primarily related to the derecognition of the intangible assets transferred which wasor reclassified as held for sale, and were included in the line item other income (loss) — net in our consolidated statements of income. See further discussion of assets and liabilities held for sale below. We expect to recover the value of the intangible assets transferred to the bottlers under the CBAs through the future quarterly payments; however, as the payments for the territory rights are dependent on the bottlers' future gross profit in these territories, they are considered a form of contingent consideration.
There is diversity in practice as it relates to the accounting for contingent consideration by the seller. The seller can account for the future contingent payments received as a gain contingency, recognizing the amounts in the income statement only after the related contingencies are resolved and the gain is realized, which in this arrangement will be quarterly as the bottlers earn gross profit in the transferred territories. Alternatively, the seller can record a receivable for the contingent consideration at fair value on the date of sale and record any future differences between the payments received and this receivable in the income statement as they occur. We elected the gain contingency treatment since the quarterly payments will be received throughout the terms of the CBAs, including all subsequent renewals, regardless of the cumulative amount received as compared to the value of the intangible assets transferred.
Philippine Bottling Operations
On December 13, 2012,January 25, 2013, the Company and Coca-Cola FEMSA executedsold a share purchase agreement for the sale of a majority ownership51 percent interest in our Philippine bottling operations. As of December 31, 2012, our Philippine bottling operations met the criteria to be classified as held for sale, and we were required to record their assets and liabilities at the lower of carrying value or fair value less any costs to sell based on the agreed-upon purchase price. Accordingly, we recorded a total loss of $107 million, primarily during the fourth quarter of 2012, in the line item other income (loss) — net in our consolidated statement of income.
This transaction was completed on January 25, 2013.Coca-Cola FEMSA, an equity method investee. The Company now accounts for our remaining 49 percent ownership interest in the Philippine bottling operations under the equity method of accounting. As a result of this transaction, we remeasured our remaining investment in the Philippine bottling operations to fair value taking into consideration the sale price of the majority ownership interest. Coca-Cola FEMSA has an option to purchase our remaining ownership interest in the Philippine bottling operations at any time during the seven years following closing based on the initial purchase price plus a defined return. Coca-Cola FEMSA also has an option exercisable during the sixth year after closing to sell its ownership interest back to the Company at a price not to exceed the initial purchase price.

8892



Brazilian Bottling Operations
On December 17, 2012,July 3, 2013, the Company entered into an agreement with several parties to combinecombined our Brazilian bottling operations with an independent bottler in Brazil in a transaction involving a disposition of shares for cash and an exchange of shares for a 44 percent minority ownership interest in the newly combined entity, which was recorded at fair value. As of December 31, 2012, our Brazilian bottling operations met the criteria to be classified as held for sale, but we were not required to record their assets and liabilities at fair value less any costs to sell because their fair value exceeded our carrying value. This transaction was completed on July 3, 2013, andcombination resulted in the deconsolidation of our Brazilian bottling operations. TheAs a result of this transaction, the Company recognized a gain of $615 million as a resultin the line item other income (loss) — net in our consolidated statement of this transaction.income during the year ended December 31, 2013.
The owners of the majority interest have the option to acquire up to 24 percent of the new entity's outstanding shares from us at any time for a period of six years beginning December 31, 2013, based on an agreed-upon formula. In December 2014, the Company received notification that the owners of the majority interest had exercised their option to acquire from us a 10 percent interest in the entity's outstanding shares. During the year ended December 31, 2014, we recorded aan estimated loss of $32 million as a result of the exercise price being lower than our carrying value. The transaction closed in January 2015, and the Company recorded an additional loss of $6 million during the year ended December 31, 2015, calculated based on the final option price. As a result of thethis transaction, which closed in January 2015, the Company's ownership was reduced to 34 percent of the entity’s outstanding shares. The owners of the majority interest have a remaining option to acquire an additional 14 percent interest of the entity’sentity's outstanding shares at any time through December 31, 2019, based on an agreed-upon formula.
Assets and Liabilities Held for Sale
North America Refranchising
As of December 31, 2014,2015, the Company had entered into agreements to refranchise additional territories in North America. These territories met the criteria to be classified as held for sale,sale. Additionally, to the extent that the parties have reached definitive agreements related to the transfer of production assets in conjunction with the new NPSS, and the related transfer is anticipated to close within a year, the related assets also met the criteria to be classified as held for sale. As such, we were required to record theirthe related assets and liabilities at the lower of carrying value or fair value less any costs to sell based on the agreed-upon sale price. The Company recognized a noncash loss of $494 million during the year ended December 31, 2014 as a result of writing down the assets to their fair value less costs to sell, which was included in the line item other income (loss) — net in our consolidated statement of income. This loss was primarily related to the anticipated derecognition of the intangible assets to be transferred, which we expect to recover under the CBAs through the future quarterly payments. The Company expects these transactions to close at various times throughout 2016.
Coca-Cola European Partners
In August 2015, the Company entered into an agreement to merge our German bottling operations with Coca-Cola Enterprises, Inc. ("CCE") and Coca-Cola Iberian Partners SA ("CCIP") to create Coca-Cola European Partners ("CCEP"). At closing, the Company will own 18 percent of CCEP, which we anticipate accounting for as an equity method investment based on our equity ownership percentage, our representation on CCEP's Board of Directors and other governance rights. The Boards of Directors of the Company, CCE and CCIP have approved the transaction. The proposed merger is subject to approval by the endCCE's shareowners, receipt of regulatory clearances and other customary conditions. The merger is expected to close in the second quarter of 2016. As a result of this agreement, our German bottling operations met the criteria to be classified as held for sale as of December 31, 2015. We were not required to record the related assets and liabilities at fair value less any costs to sell because their fair value exceeded our carrying value.
Coca-Cola Beverages Africa Limited
In November 2014, the Company, SAB Miller plc, and Gutsche Family Investments announcedentered into an agreement to combine the bottling operations of theireach of the parties' nonalcoholic ready-to-drink beverage businesses in Southern and East Africa. Upon completion of the proposed merger, the Company will have an ownership of 11 percent in the bottler which will be called Coca-Cola Beverages Africa Limited. The Company will also acquire or license several brands in exchange for cash as a result of the transaction. As of December 31, 2014,2015, our South African bottling operations and related equity method investments met the criteria to be classified as held for sale, but we were not required to record these assets and liabilities at fair value less any costs to sell because their fair value exceeded our carrying value. The Company expects the transaction to close in the second halfquarter of 2015,2016, subject to regulatory approval. Based on the proposed governance structure, the Company expects to account for its resulting interest in the new entity as an equity method investment.
Monster Beverage Corporation
In August 2014, the Company and Monster Beverage Corporation ("Monster") entered into definitive agreements for a long-term strategic relationship in the global energy drink category. Subject to the terms and conditions of the agreements, upon the closing of the transactions (1) the Company will acquire newly issued shares of Monster common stock representing approximately 16.7 percent of the outstanding shares of Monster common stock (after giving effect to the new issuance) and will be represented by two directors on Monster's Board of Directors; (2) the Company will transfer its global energy drink business (including NOS, Full Throttle, Burn, Mother, Nalu, Play and Power Play, and Relentless) to Monster, and Monster will transfer its non-energy drink business (including Hansen's Natural Sodas, Peace Tea, Hubert's Lemonade and Hansen's Juice Products) to the Company; and (3) the parties will amend their current distribution coordination agreements with Monster to expand distribution of Monster products into additional territories pursuant to long-term agreements with the Company's existing network of Company-owned or -controlled bottling operations and bottling and distribution partners. Upon closing, the Company will make a net cash payment of $2.15 billion to Monster. The closing of the transaction is subject to customary closing conditions, including the receipt of regulatory approvals, and is expected to take place in the second quarter of 2015. Based on our anticipated representation on Monster's Board of Directors, the Company expects to account for its resulting interest in Monster as an equity method investment. As of December 31, 2014, the assets held by the Company's global energy drink business met the criteria to be held for sale, however, we were not required to record the assets at their fair value less any costs to sell because their fair value exceeded our carrying value.

8993



The following table presents information related to the major classes of assets and liabilities that were classified as held for sale in our consolidated balance sheet (in millions):
December 31, 2014
December 31, 2015
 December 31, 2014
 
Cash, cash equivalents and short-term investments$30
$143
 $30
 
Trade accounts receivable, less allowances100
485
 100
 
Inventories54
276
 54
 
Prepaid expenses and other assets7
83
 7
 
Equity method investments141
92
 141
 
Other assets3
25
 3
 
Property, plant and equipment — net303
2,021
 303
 
Bottlers' franchise rights with indefinite lives410
1,020
 410
 
Trademarks43

 43
 
Goodwill46
333
 46
 
Other intangible assets36
115
 36
 
Allowance for reduction of assets held for sale(494)(693) (494) 
Total assets$679
$3,900
1 
$679
3 
Accounts payable and accrued expenses$48
$712
 $48
 
Current maturities of long-term debt12
 
 
Accrued income taxes4
 
 
Long-term debt74
 
 
Other liabilities6
79
 6
 
Deferred income taxes4
252
 4
 
Total liabilities$58
$1,133
2 
$58
4 
1
Consists of total assets relating to CCEP of $2,894 million, North America refranchising of $589 million, Coca-Cola Beverages Africa Limited of $398 million and other assets held for sale of $19 million, which are included in the Europe, North America, Eurasia and Africa, Bottling Investments and Corporate operating segments.
2
Consists of total liabilities relating to CCEP of $924 million, North America refranchising of $123 million and Coca-Cola Beverages Africa Limited of $86 million, which are included in the Europe, North America, Eurasia and Africa, and Bottling Investments operating segments.
3
Consists of total assets relating to North America refranchising of $223 million, Coca-Cola Beverages Africa Limited of $333 million, the Monster Transaction of $43 million and other assets held for sale of $80 million, which are included in the North America, Eurasia and Africa, Bottling Investments and Corporate operating segments.
4
Consists of total liabilities relating to North America refranchising of $22 million and Coca-Cola Beverages Africa Limited of $36 million, which are included in the North America, Eurasia and Africa, and Bottling Investments operating segments.
Included inWe determined that the amounts above are total assets relating to North America refranchising of $223 million, Coca-Cola Beverages Africa Limited of $333 million, the pending Monster transaction of $43 million, and other assets held for sale of $80 million, and areoperations included in the North America, Eurasia and Africa, Bottling Investments and Corporate operating segments. We determined that these operationstable above did not meet the criteria to be classified as discontinued operations primarily due tounder the continued significant involvement we will have in these operations following each transaction.applicable guidance.

94



NOTE 3: INVESTMENTS
Investments in debt and marketable securities, other than investments accounted for under the equity method, are classified as trading, available-for-sale or held-to-maturity. Our marketable equity investments are classified as either trading or available-for-sale with their cost basis determined by the specific identification method. Our investments in debt securities are carried at either amortized cost or fair value. Investments in debt securities that the Company has the positive intent and ability to hold to maturity are carried at amortized cost and classified as held-to-maturity. Investments in debt securities that are not classified as held-to-maturity are carried at fair value and classified as either trading or available-for-sale. Realized and unrealized gains and losses on trading securities and realized gains and losses on available-for-sale securities are included in net income. Unrealized gains and losses, net of deferred taxes, on available-for-sale securities are included in our consolidated balance sheets as a component of AOCI, except for the change in fair value attributable to the currency risk being hedged. Refer to Note 5 for additional information related to the Company's fair value hedges of available-for-sale securities.
Trading Securities
As of December 31, 20142015 and 2013,2014, our trading securities had a fair value of $409$322 million and $372$409 million, respectively, and consisted primarily of equity securities. The Company had net unrealized gains on trading securities of $19 million, $40 million $12 million, and $19$12 million as of December 31, 2015, 2014 2013 and 2012,2013, respectively.
The Company's trading securities were included in the following line items in our consolidated balance sheets (in millions):
December 31,2014
 2013
2015
 2014
Marketable securities$315
 $286
$229
 $315
Other assets94
 86
93
 94
Total trading securities$409
 $372
$322
 $409

90



Available-for-Sale and Held-to-Maturity Securities
As of December 31, 20142015 and 2013,2014, the Company did not have any held-to-maturity securities. Available-for-sale securities consisted of the following (in millions):
  
Gross Unrealized  
 Estimated Fair Value  
Gross Unrealized  
 Estimated Fair Value
Cost Gains Losses Cost Gains Losses 
2015       
Available-for-sale securities:1
       
Equity securities$3,573
 $485
 $(84) $3,974
Debt securities4,593
 64
 (25) 4,632
Total$8,166
 $549
 $(109) $8,606
2014              
Available-for-sale securities:1
              
Equity securities$2,687
 $1,463
 $(29) $4,121
$2,687
 $1,463
 $(29) $4,121
Debt securities3,796
 68
 (106)
2 
3,758
3,796
 68
 (106)
2 
3,758
$6,483
 $1,531
 $(135) $7,879
2013       
Available-for-sale securities:1
       
Equity securities$1,097
 $373
 $(17) $1,453
Debt securities3,388
 24
 (23) 3,389
$4,485
 $397
 $(40) $4,842
Total$6,483
 $1,531
 $(135) $7,879
1 
Refer to Note 16 for additional information related to the estimated fair value.
2 Includes $101 million recognized in the consolidated income statement line item other income (loss) — net during the year ended December 31, 2014. The amount was primarily offset by changes in the fair value of foreign currency contracts designated as fair value hedges. Refer to Note 5 for additional information.
The sale and/or maturity of available-for-sale securities resulted in the following activity (in millions):
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
Gross gains$38
 $12
 $41
$103
 $38
 $12
Gross losses(21) (24) (35)(42) (21) (24)
Proceeds4,157
 4,212
 5,036
4,043
 4,157
 4,212

95



In 20142015 and 2013,2014, the Company had investments classified as available-for-sale securities in which our cost basis exceeded the fair value of our investment. Management assessed each of these investments on an individual basis to determine if the decline in fair value was other than temporary. Management's assessment as to the nature of a decline in fair value is based on, among other things, the length of time and the extent to which the market value has been less than our cost basis; the financial condition and near-term prospects of the issuer; and our intent and ability to retain the investment for a period of time sufficient to allow for any anticipated recovery in market value. As a result of these assessments, management determined that the decline in fair value of these investments was not other than temporary and did not record any impairment charges.
The Company uses insurance captives to reinsure group annuity insurance contracts that cover the pension obligations of certain of our European and Canadian pension plans. In accordance with local insurance regulations, our insurance captive is required to meet and maintain minimum solvency capital requirements. The Company elected to invest its solvency capital in a portfolio of available-for-sale securities, which have been classified in the line item other assets in our consolidated balance sheets because the assets are not available to satisfy our current obligations. As of December 31, 2014,2015 and December 31, 2013,2014, the Company's available-for-sale securities included solvency capital funds of $836$804 million and $667$836 million, respectively.
InAs of December 31, 2015 and 2014, and 2013, the Company did not have any held-to-maturity securities. The Company's available-for-sale securities were included in the following line items in our consolidated balance sheets (in millions):
December 31,2014
 2013
2015
 2014
Cash and cash equivalents$43
 $245
$361
 $43
Marketable securities3,350
 2,861
4,040
 3,350
Other investments3,512
 958
3,280
 3,512
Other assets974
 778
925
 974
$7,879
 $4,842
Total$8,606
 $7,879

91



The contractual maturities of these investments as of December 31, 2014,2015 were as follows (in millions):
Available-for-Sale Securities  
Available-for-Sale Securities  
Cost
 Fair Value
Cost
 Fair Value
Within 1 year$1,589
 $1,489
$2,496
 $2,496
After 1 year through 5 years1,709
 1,747
1,709
 1,728
After 5 years through 10 years118
 130
111
 122
After 10 years380
 392
277
 286
Equity securities2,687
 4,121
3,573
 3,974
$6,483
 $7,879
Total$8,166
 $8,606
The Company expects that actual maturities may differ from the contractual maturities above because borrowers have the right to call or prepay certain obligations.
Cost Method Investments
Cost method investments are initially recorded at cost, and we record dividend income when applicable dividends are declared. Cost method investments are reported as other investments in our consolidated balance sheets, and dividend income from cost method investments is reported in other income (loss) — net in our consolidated statements of income. We review all of our cost method investments quarterly to determine if impairment indicators are present; however, we are not required to determine the fair value of these investments unless impairment indicators exist. When impairment indicators exist, we generally use discounted cash flow analyses to determine the fair value. We estimate that the fair values of our cost method investments approximated or exceeded their carrying values as of December 31, 20142015 and 2013.2014. Our cost method investments had a carrying value of $166$190 million and $162$166 million as of December 31, 2015 and 2014, and 2013, respectively.

96



NOTE 4: INVENTORIES
Inventories consist primarily of raw materials and packaging (which includes ingredients and supplies) and finished goods (which include concentrates and syrups in our concentrate operations and finished beverages in our finished product operations). Inventories are valued at the lower of cost or market. We determine cost on the basis of the average cost or first-in, first-out methods. Inventories consisted of the following (in millions):
December 31,2014
 2013
2015
 2014
Raw materials and packaging$1,615
 $1,692
$1,564
 $1,615
Finished goods1,134
 1,240
1,032
 1,134
Other351
 345
306
 351
Total inventories$3,100
 $3,277
$2,902
 $3,100
NOTE 5: HEDGING TRANSACTIONS AND DERIVATIVE FINANCIAL INSTRUMENTS
The Company is directly and indirectly affected by changes in certain market conditions. These changes in market conditions may adversely impact the Company's financial performance and are referred to as "market risks." Our Company, whenWhen deemed appropriate, our Company uses derivatives as a risk management tool to mitigate the potential impact of certain market risks. The primary market risks managed by the Company through the use of derivative and non-derivative financial instruments are foreign currency exchange rate risk, commodity price risk and interest rate risk.
The Company uses various types of derivative instruments including, but not limited to, forward contracts, commodity futures contracts, option contracts, collars and swaps. Forward contracts and commodity futures contracts are agreements to buy or sell a quantity of a currency or commodity at a predetermined future date, and at a predetermined rate or price. An option contract is an agreement that conveys the purchaser the right, but not the obligation, to buy or sell a quantity of a currency or commodity at a predetermined rate or price during a period or at a time in the future. A collar is a strategy that uses a combination of options to limit the range of possible positive or negative returns on an underlying asset or liability to a specific range, or to protect expected future cash flows. To do this, an investor simultaneously buys a put option and sells (writes) a call option, or alternatively buys a call option and sells (writes) a put option. A swap agreement is a contract between two parties to exchange cash flows based on specified underlying notional amounts, assets and/or indices. We do not enter into derivative financial instruments for trading purposes. The Company may also designate certain non-derivative instruments, such as our foreign-denominated debt, in hedging relationships.
All derivatives are carried at fair value in our consolidated balance sheets in the following line items, as applicable: prepaid expenses and other assets; other assets; accounts payable and accrued expenses; and other liabilities. The carrying values of the

92



derivatives reflect the impact of legally enforceable master netting agreements and cash collateral held or placed with the same counterparties, as applicable. These master netting agreements allow the Company to net settle positive and negative positions (assets and liabilities) arising from different transactions with the same counterparty.
The accounting for gains and losses that result from changes in the fair values of derivative instruments depends on whether the derivatives have been designated and qualify as hedging instruments and the type of hedging relationships. Derivatives can be designated as fair value hedges, cash flow hedges or hedges of net investments in foreign operations. The changes in the fair values of derivatives that have been designated and qualify for fair value hedge accounting are recorded in the same line item in our consolidated statements of income as the changes in the fair values of the hedged items attributable to the risk being hedged. The changes in the fair values of derivatives that have been designated and qualify as cash flow hedges or hedges of net investments in foreign operations are recorded in AOCI and are reclassified into the line item in our consolidated statement of income in which the hedged items are recorded in the same period the hedged items affect earnings. Due to the high degree of effectiveness between the hedging instruments and the underlying exposures being hedged, fluctuations in the value of the derivative instruments are generally offset by changes in the fair values or cash flows of the underlying exposures being hedged. The changes in the fair values of derivatives that were not designated and/or did not qualify as hedging instruments are immediately recognized into earnings.

97



For derivatives that will be accounted for as hedging instruments, the Company formally designates and documents, at inception, the financial instrument as a hedge of a specific underlying exposure, the risk management objective and the strategy for undertaking the hedge transaction. In addition, the Company formally assesses, both at the inception and at least quarterly thereafter, whether the financial instruments used in hedging transactions are effective at offsetting changes in either the fair values or cash flows of the related underlying exposures. Any ineffective portion of a financial instrument's change in fair value is immediately recognized into earnings.
The Company determines the fair values of its derivatives based on quoted market prices or pricing models using current market rates. Refer to Note 16. The notional amounts of the derivative financial instruments do not necessarily represent amounts exchanged by the parties and, therefore, are not a direct measure of our exposure to the financial risks described above. The amounts exchanged are calculated by reference to the notional amounts and by other terms of the derivatives, such as interest rates, foreign currency exchange rates, commodity rates or other financial indices. The Company does not view the fair values of its derivatives in isolation but rather in relation to the fair values or cash flows of the underlying hedged transactions or other exposures. Virtually all of our derivatives are straightforward over-the-counter instruments with liquid markets.
The following table presents the fair values of the Company's derivative instruments that were designated and qualified as part of a hedging relationship (in millions):
  
Fair Value1,2
  
Fair Value1,2
Derivatives Designated as Hedging Instruments
Balance Sheet Location1
 December 31,
2014

 December 31,
2013

Balance Sheet Location1
 December 31,
2015

 December 31,
2014

Assets:          
Foreign currency contractsPrepaid expenses and other assets $923
 $211
Prepaid expenses and other assets $572
 $923
Foreign currency contractsOther assets 346
 109
Other assets 246
 346
Commodity contractsPrepaid expenses and other assets 
 1
Prepaid expenses and other assets 1
 
Interest rate contractsPrepaid expenses and other assets 14
 
Prepaid expenses and other assets 20
 14
Interest rate contractsOther assets 146
 283
Other assets 62
 146
Total assets  $1,429
 $604
  $901
 $1,429
Liabilities:          
Foreign currency contractsAccounts payable and accrued expenses $24
 $84
Accounts payable and accrued expenses $51
 $24
Foreign currency contractsOther liabilities 249
 40
Other liabilities 75
 249
Commodity contractsAccounts payable and accrued expenses 1
 1
Accounts payable and accrued expenses 
 1
Interest rate contractsAccounts payable and accrued expenses 11
 
Accounts payable and accrued expenses 53
 11
Interest rate contractsOther liabilities 35
 
Other liabilities 231
 35
Total liabilities  $320
 $125
  $410
 $320
1 
All of the Company's derivative instruments are carried at fair value in our consolidated balance sheets after considering the impact of legally enforceable master netting agreements and cash collateral held or placed with the same counterparties, as applicable. Current disclosure requirements mandate that derivatives must also be disclosed without reflecting the impact of master netting agreements and cash collateral. Refer to Note 16 for the net presentation of the Company's derivative instruments.
2 
Refer to Note 16 for additional information related to the estimated fair value.

9398



The following table presents the fair values of the Company's derivative instruments that were not designated as hedging instruments (in millions):
  
Fair Value1,2
  
Fair Value1,2
Derivatives Not Designated as Hedging Instruments
Balance Sheet Location1
 December 31,
2014

 December 31,
2013

Balance Sheet Location1
 December 31,
2015

 December 31,
2014

Assets:          
Foreign currency contractsPrepaid expenses and other assets $44
 $21
Prepaid expenses and other assets $105
 $44
Foreign currency contractsOther assets 231
 171
Other assets 241
 231
Commodity contractsPrepaid expenses and other assets 9
 33
Prepaid expenses and other assets 2
 9
Commodity contractsOther assets 1
 1
Other assets 1
 1
Other derivative instrumentsPrepaid expenses and other assets 14
 9
Prepaid expenses and other assets 17
 14
Other derivative instrumentsOther assets 2
 
Other assets 3
 2
Total assets  $301
 $235
  $369
 $301
Liabilities:          
Foreign currency contractsAccounts payable and accrued expenses $33
 $24
Accounts payable and accrued expenses $59
 $33
Foreign currency contractsOther liabilities 21
 
Other liabilities 9
 21
Commodity contractsAccounts payable and accrued expenses 156
 23
Accounts payable and accrued expenses 154
 156
Commodity contractsOther liabilities 17
 
Other liabilities 19
 17
Interest rate contractsOther liabilities 2
 3
Other liabilities 1
 2
Other derivative instrumentsAccounts payable and accrued expenses 11
 
Accounts payable and accrued expenses 5
 11
Other derivative instrumentsOther liabilities 2
 
Total liabilities  $240
 $50
  $249
 $240
1 
All of the Company's derivative instruments are carried at fair value in our consolidated balance sheets after considering the impact of legally enforceable master netting agreements and cash collateral held or placed with the same counterparties, as applicable. Current disclosure requirements mandate that derivatives must also be disclosed without reflecting the impact of master netting agreements and cash collateral. Refer to Note 16 for the net presentation of the Company's derivative instruments.
2 
Refer to Note 16 for additional information related to the estimated fair value.
Credit Risk Associated with Derivatives
We have established strict counterparty credit guidelines and enter into transactions only with financial institutions of investment grade or better. We monitor counterparty exposures regularly and review any downgrade in credit rating immediately. If a downgrade in the credit rating of a counterparty were to occur, we have provisions requiring collateral in the form of U.S. government securities for substantially all of our transactions. To mitigate presettlement risk, minimum credit standards become more stringent as the duration of the derivative financial instrument increases. In addition, the Company's master netting agreements reduce credit risk by permitting the Company to net settle for transactions with the same counterparty. To minimize the concentration of credit risk, we enter into derivative transactions with a portfolio of financial institutions. Based on these factors, we consider the risk of counterparty default to be minimal.
Cash Flow Hedging Strategy
The Company uses cash flow hedges to minimize the variability in cash flows of assets or liabilities or forecasted transactions caused by fluctuations in foreign currency exchange rates, commodity prices or interest rates. The changes in the fair values of derivatives designated as cash flow hedges are recorded in AOCI and are reclassified into the line item in our consolidated statement of income in which the hedged items are recorded in the same period the hedged items affect earnings. The changes in fair values of hedges that are determined to be ineffective are immediately reclassified from AOCI into earnings. During the years ended December 31, 2014, 2013 and 2012, the Company did not record any gains or losses into earnings as a result of the discontinuance of cash flow hedges due to forecasted transactions that were no longer expected to occur. The maximum length of time for which the Company hedges its exposure to the variability in future cash flows is typically three years.

9499



The Company maintains a foreign currency cash flow hedging program to reduce the risk that our eventual U.S. dollar net cash inflows from sales outside the United States and U.S. dollar net cash outflows from procurement activities will be adversely affected by changes in foreign currency exchange rates. We enter into forward contracts and purchase foreign currency options (principally euros and Japanese yen) and collars to hedge certain portions of forecasted cash flows denominated in foreign currencies. When the U.S. dollar strengthens against the foreign currencies, the decline in the present value of future foreign currency cash flows is partially offset by gains in the fair value of the derivative instruments. Conversely, when the U.S. dollar weakens, the increase in the present value of future foreign currency cash flows is partially offset by losses in the fair value of the derivative instruments. The total notional values of derivatives that have been designated and qualify for the Company's foreign currency cash flow hedging program were $13,224$10,383 million and $8,450$13,224 million as of December 31, 20142015 and 2013,2014, respectively.
During the year ended December 31, 2014, theThe Company entered intouses cross-currency swaps to hedge the changes in the cash flows of certain of its euro-denominatedforeign currency denominated debt due to changes in euroforeign currency exchange rates. These swaps have been designated as cash flow hedges. TheFor this hedging program, the Company records the change in carrying value of the euro-denominatedforeign currency denominated debt due to changes in exchange rates into earnings each period in the line item other income (loss) — net in our consolidated statement of income.period. The changes in fair value of the cross-currency swap derivatives are recorded intoin AOCI with an immediate reclassification into earnings for the change in fair value attributable to fluctuations in the euroforeign currency exchange rates. These swaps havehad a notional amount of $2,590 million as of December 31, 2014. During the year ended December 31, 2015, the Company discontinued the cash flow hedge relationships related to these swaps. Upon discontinuance, the Company recognized a loss of $92 million in other comprehensive income, which will be reclassified from AOCI into interest expense over the remaining life of the debt, a weighted-average period of approximately 10 years. The Company did not discontinue any cash flow hedging relationships during the years ended December 31, 2014. and 2013. During the year ended December 31, 2015, the Company entered into new cross-currency swaps, which had a notional value of $566 million as of December 31, 2015.
The Company has entered into commodity futures contracts and other derivative instruments on various commodities to mitigate the price risk associated with forecasted purchases of materials used in our manufacturing process. TheThese derivative instruments have been designated and qualify as part of the Company's commodity cash flow hedging program. The objective of this hedging program is to reduce the variability of cash flows associated with future purchases of certain commodities. The total notional values of derivatives that have been designated and qualify for this program were $98 million and $269 million as of December 31, 20142015 and 20132014, respectively.
Our Company monitors our mix of short-term debt and long-term debt regularly. From time to time, we manage our risk to interest rate fluctuations through the use of derivative financial instruments. The Company has entered into interest rate swap agreements and has designated these instruments as part of the Company's interest rate cash flow hedging program. The objective of this hedging program is to mitigate the risk of adverse changes in benchmark interest rates on the Company's future interest payments. The total notional values of these interest rate swap agreements that were designated and qualified for the Company's interest rate cash flow hedging program were $4,328$3,328 million and $1,8284,328 million as of December 31, 20142015 and 20132014, respectively.

95100



The following table presents the pretax impact that changes in the fair values of derivatives designated as cash flow hedges had on AOCI and earnings during the years ended December 31, 2015, 2014 2013 and 20122013 (in millions):
Gain (Loss)
Recognized
in Other
Comprehensive
Income ("OCI")

 
Location of Gain (Loss)
Recognized in Income1
 
Gain (Loss)
Reclassified from
AOCI into Income
(Effective Portion)

 
Gain (Loss)
Recognized in Income
(Ineffective Portion and
Amount Excluded from
Effectiveness Testing)

 
Gain (Loss)
Recognized
in Other
Comprehensive
Income ("OCI")

 
Location of Gain (Loss)
Recognized in Income1
 
Gain (Loss)
Reclassified from
AOCI into Income
(Effective Portion)

 
Gain (Loss)
Recognized in Income
(Ineffective Portion and
Amount Excluded from
Effectiveness Testing)

 
2015        
Foreign currency contracts$949
 Net operating revenues $618
 $12
 
Foreign currency contracts60
 Cost of goods sold 62
 
2 
Foreign currency contracts18
 Interest expense (9) 
 
Foreign currency contracts(38) Other income (loss) — net (40) 
 
Interest rate contracts(153) Interest expense (3) 1
 
Commodity contracts(1) Cost of goods sold (3) 
 
Total$835
 $625
 $13
 
2014              
Foreign currency contracts$973
 Net operating revenues $121
 $
2 
$973
 Net operating revenues $121
 $
2 
Foreign currency contracts50
 Cost of goods sold 34
 
2 
50
 Cost of goods sold 34
 
2 
Foreign currency contracts(218) Other income (loss) — net (108) 
 (218) Other income (loss) — net (108) 
 
Interest rate contracts(180) Interest expense 
 
 (180) Interest expense 
 
 
Commodity contracts
 Cost of goods sold 3
 
 
 Cost of goods sold 3
 
 
Total$625
 $50
 $
 $625
   $50
 $
 
2013            
Foreign currency contracts$218
 Net operating revenues $149
 $1
 $218
 Net operating revenues $149
 $1
 
Foreign currency contracts52
 Cost of goods sold 32
 
2 
52
 Cost of goods sold 32
 
2 
Interest rate contracts169
 Interest expense (12) (3) 169
 Interest expense (12) (3) 
Commodity contracts2
 Cost of goods sold (2) 
 2
 Cost of goods sold (2) 
 
Total$441
   $167
 $(2) $441
 $167
 $(2) 
2012      
Foreign currency contracts$59
 Net operating revenues $(46) $2
 
Foreign currency contracts34
 Cost of goods sold (23) 
 
Interest rate contracts1
 Interest expense (12) 
2 
Commodity contracts(4) Cost of goods sold (1) 
 
Total$90
 $(82) $2
 
1 
The Company records gains and losses reclassified from AOCI ininto income for the effective portion and ineffective portion, if any, to the same line items in our consolidated statements of income.
2 
Includes a de minimis amount of ineffectiveness in the hedging relationship.
As of December 31, 20142015, the Company estimates that it will reclassify into earnings during the next 12 months gains of approximately $416697 million from the pretax amount recorded in AOCI as the anticipated cash flows occur.
Fair Value Hedging Strategy
The Company uses interest rate swap agreements designated as fair value hedges to minimize exposure to changes in the fair value of fixed-rate debt that results from fluctuations in benchmark interest rates. The Company also uses cross-currency interest rate swaps to hedge the changes in the fair value of foreign currency denominated debt relating to changes in foreign currency exchange rates and benchmark interest rates. The changes in fair values of derivatives designated as fair value hedges and the offsetting changes in fair values of the hedged items are recognized in earnings. The ineffective portions of these hedges are immediately recognized into earnings. As of December 31, 20142015, such adjustments increasedhad cumulatively decreased the carrying value of our long-term debt by $3486 million. Refer to Note 10. When a derivative is no longer designated as a fair value hedge for any reason, including termination and maturity, the remaining unamortized difference between the carrying value of the hedged item at that time and the parface value of the hedged item is amortized to earnings over the remaining life of the hedged item, or immediately if the hedged item has matured. The changes in fair values of hedges that are determined to be ineffective are immediately recognized into earnings. The total notional values of derivatives that related to our fair value hedges of this type were $6,6007,963 million and $5,6006,600 million as of December 31, 20142015 and 20132014, respectively.

96101



The Company also uses fair value hedges to minimize exposure to changes in the fair value of certain available-for-sale securities from fluctuations in foreign currency exchange rates. The changes in fair values of derivatives designated as fair value hedges and the offsetting changes in fair values of the hedged items due to changes in foreign currency exchange rates are recognized in earnings. The changesAs a result, any difference is reflected in fair values of hedges that are determined to be ineffective are immediately recognized into earnings.earnings as ineffectiveness. The total notional values of derivatives that related to our fair value hedges of this type were $1,358$2,159 million and $996$1,358 million as of December 31, 20142015 and 2013,2014, respectively.
The following table summarizes the pretax impact that changes in the fair values of derivatives designated as fair value hedges had on earnings during the years ended December 31, 2015, 2014 2013 and 20122013 (in millions):
Hedging Instruments and Hedged Items
Location of Gain (Loss)
Recognized in Income
Gain (Loss)
Recognized in Income1

Location of Gain (Loss)
Recognized in Income
Gain (Loss)
Recognized in Income1

2015  
Interest rate contractsInterest expense$(172)
Fixed-rate debtInterest expense169
Net impact to interest expense $(3)
Foreign currency contractsOther income (loss) — net$110
Available-for-sale securitiesOther income (loss) — net(131)
Net impact to other income (loss) — net $(21)
Net impact of fair value hedging instruments $(24)
2014    
Interest rate contractsInterest expense$18
Interest expense$18
Fixed-rate debtInterest expense11
Interest expense11
Net impact to interest expense $29
 $29
Foreign currency contractsOther income (loss) — net$132
Other income (loss) — net$132
Available-for-sale securitiesOther income (loss) — net(165)Other income (loss) — net(165)
Net impact to other income (loss) — net $(33) $(33)
Net impact of fair value hedging instruments $(4) $(4)
2013    
Interest rate contractsInterest expense$(193)Interest expense$(193)
Fixed-rate debtInterest expense240
Interest expense240
Net impact to interest expense $47
 $47
Foreign currency contractsOther income (loss) — net$24
Other income (loss) — net$24
Available-for-sale securitiesOther income (loss) — net(48)Other income (loss) — net(48)
Net impact to other income (loss) — net $(24) $(24)
Net impact of fair value hedging instruments $23
 $23
2012  
Interest rate contractsInterest expense$89
Fixed-rate debtInterest expense(42)
Net impact to interest expense $47
Foreign currency contractsOther income (loss) — net$42
Available-for-sale securitiesOther income (loss) — net(46)
Net impact to other income (loss) — net $(4)
Net impact of fair value hedging instruments $43
1 The net impacts represent the ineffective portions of the hedge relationships and the amounts excluded from the assessment of hedge effectiveness.
Hedges of Net Investments in Foreign Operations Strategy
The Company uses forward contracts and non-derivative financial instruments to protect the value of our investments in a number of foreign subsidiaries. During the year ended December 31, 2015, the Company designated a portion of its euro-denominated debt as a hedge of a net investment in our European operations. The change in the carrying value of the designated portion of the euro-denominated debt due to changes in foreign currency exchange rates is recorded in net foreign currency translation adjustment, a component of AOCI. For derivative instruments that are designated and qualify as hedges of net investments in foreign operations, the changes in fair values of the derivative instruments are recognized in net foreign currency translation gain (loss), a component of AOCI,adjustment, to offset the changes in the values of the net investments being hedged. Any ineffective portions of net investment hedges are reclassified from AOCI into earnings during the period of change. The total notional values of derivatives under this hedging program were $2,047 million and $2,024 million as of December 31, 2014 and 2013, respectively.

97102



The following table presentssummarizes the notional values and pretax impact thatof changes in the fair values of derivativesinstruments designated as net investment hedges had on AOCI during the years ended December 31, 2014, 2013 and 2012 (in millions):
Gain (Loss)
Recognized in OCI  
Notional Amount Gain (Loss) Recognized in OCI
Year Ended December 31,2014
 2013
 2012
as of December 31, Year Ended December 31,
2015
2014
 2015
2014
2013
Foreign currency contracts$80
 $61
 $(61)$1,347
$2,047
 $661
$80
$61
Foreign currency denominated debt10,912

 (24)

Total$12,259
$2,047
 $637
$80
$61
The Company did not reclassify any deferred gains or losses related to net investment hedges from AOCI to earnings during the years ended December 31, 2015, 2014 2013 and 2012.2013. In addition, the Company did not have any ineffectiveness related to net investment hedges during the years ended December 31, 2015, 2014 2013 and 2012.2013. The cash inflows and outflows associated with the Company's derivative contracts designated as net investment hedges are classified in the line item other investing activities in our consolidated statements of cash flows.
Economic (Non-Designated) Hedging Strategy
In addition to derivative instruments that are designated and qualify for hedge accounting, the Company also uses certain derivatives as economic hedges of foreign currency, interest rate and commodity exposure. Although these derivatives were not designated and/or did not qualify for hedge accounting, they are effective economic hedges. The changes in fair value of economic hedges are immediately recognized into earnings.
The Company uses foreign currency economic hedges to offset the earnings impact that fluctuations in foreign currency exchange rates have on certain monetary assets and liabilities denominated in nonfunctional currencies. The changes in fair value of economic hedges used to offset thethose monetary assets and liabilities are immediately recognized into earnings in the line item other income (loss) — net in our consolidated statements of income. In addition, we use foreign currency economic hedges to minimize the variability in cash flows associated with changesfluctuations in foreign currency exchange rates. The changes in fair valuevalues of economic hedges used to offset the variability in U.S. dollar net cash flows are recognized into earnings in the line items net operating revenues andor cost of goods sold in our consolidated statements of income.income, as applicable. The total notional values of derivatives related to our foreign currency economic hedges were $4,334$3,605 million and $3,871$4,334 million as of December 31, 20142015 and 2013,2014, respectively.
The Company also uses certain derivatives as economic hedges to mitigate the price risk associated with the purchase of materials used in the manufacturing process and for vehicle fuel. The changes in fair values of these economic hedges are immediately recognized into earnings in the line items net operating revenues, cost of goods sold, and selling, general and administrative expenses in our consolidated statements of income, as applicable. The total notional values of derivatives related to our economic hedges of this type were $816$893 million and $1,441$816 million as of December 31, 20142015 and 2013,2014, respectively.
The following table presents the pretax impact that changes in the fair values of derivatives not designated as hedging instruments had on earnings during the years ended December 31, 2015, 2014 2013 and 20122013 (in millions):
  Gains (Losses)
Derivatives Not Designated
as Hedging Instruments
Location of Gains (Losses)
Recognized in Income
 Year Ended December 31,
Location of Gain (Loss)
Recognized in Income
 Year Ended December 31,
2014
 2013
 2012
2015
 2014
 2013
Foreign currency contractsNet operating revenues $(6) $5
 $(7)Net operating revenues $41
 $(6) $5
Foreign currency contractsOther income (loss) — net (85) 162
 24
Other income (loss) — net (92) (85) 162
Foreign currency contractsCost of goods sold 
 2
 
Cost of goods sold 3
 
 2
Commodity contractsNet operating revenues (48) 5
 4
Net operating revenues (16) (48) 5
Commodity contractsCost of goods sold (8) (122) (110)Cost of goods sold (209) (8) (122)
Commodity contractsSelling, general and administrative expenses (79) 7
 9
Selling, general and administrative expenses (25) (79) 7
Interest rate swapsInterest expense 
 (3) 
Interest rate contractsInterest expense 
 
 (3)
Other derivative instrumentsSelling, general and administrative expenses 24
 55
 18
Selling, general and administrative expenses 1
 24
 55
Other derivative instrumentsOther income (loss) — net 39
 
 
Other income (loss) — net (37) 39
 
Total  $(163) $111
 $(62)  $(334) $(163) $111

98103



NOTE 6: EQUITY METHOD INVESTMENTS
Our consolidated net income includes our Company's proportionate share of the net income or loss of our equity method investees. When we record our proportionate share of net income, it increases equity income (loss) — net in our consolidated statements of income and our carrying value in that investment. Conversely, when we record our proportionate share of a net loss, it decreases equity income (loss) — net in our consolidated statements of income and our carrying value in that investment. The Company's proportionate share of the net income or loss of our equity method investees includes significant operating and nonoperating items recorded by our equity method investees. These items can have a significant impact on the amount of equity income (loss) — net in our consolidated statements of income and our carrying value in those investments. Refer to Note 17 for additional information related to significant operating and nonoperating items recorded by our equity method investees. The carrying values of our equity method investments are also impacted by our proportionate share of items impacting the equity investee's AOCI.
We eliminate from our financial results all significant intercompany transactions, including the intercompany portion of transactions with equity method investees.
The Company's equity method investments include our ownership interests in Coca-Cola FEMSA, Coca-Cola Hellenic, Coca-Cola Amatil Limited and Coca-Cola Amatil.Monster. As of December 31, 2014,2015, we owned approximately 28 percent, 2324 percent, 29 percent and 2917 percent, respectively, of these companies' outstanding shares. As of December 31, 2014,2015, our investment in our equity method investees in the aggregate exceeded our proportionate share of the net assets of these equity method investees by $1,671$4,306 million. This difference is not amortized.
A summary of financial information for our equity method investees in the aggregate is as follows (in millions):
Year Ended December 31,2014
 2013
 2012
Year Ended December 31,1
2015
 2014
 2013
Net operating revenues$52,627
 $53,038
 $47,087
$47,498
 $52,627
 $53,038
Cost of goods sold31,810
 32,377
 28,821
28,749
 31,810
 32,377
Gross profit$20,817
 $20,661
 $18,266
$18,749
 $20,817
 $20,661
Operating income$4,489
 $4,380
 $4,605
$4,483
 $4,489
 $4,380
Consolidated net income$2,440
 $2,364
 $2,993
$2,299
 $2,440
 $2,364
Less: Net income attributable to noncontrolling interests74
 62
 89
65
 74
 62
Net income attributable to common shareowners$2,366
 $2,302
 $2,904
$2,234
 $2,366
 $2,302
Equity income (loss) — net$769
 $602
 $819
$489
 $769
 $602
1 The financial information represents the results of the equity method investees during the Company's period of ownership.
December 31,2014
 2013
2015
 2014
Current assets$16,184
 $19,229
$17,524
 $16,184
Noncurrent assets40,080
 40,427
36,498
 40,080
Total assets$56,264
 $59,656
$54,022
 $56,264
Current liabilities$12,477
 $14,386
$11,820
 $12,477
Noncurrent liabilities16,657
 17,779
14,467
 16,657
Total liabilities$29,134
 $32,165
$26,287
 $29,134
Equity attributable to shareowners of investees$26,363
 $26,668
$26,854
 $26,363
Equity attributable to noncontrolling interests767
 823
881
 767
Total equity$27,130
 $27,491
$27,735
 $27,130
Company equity investment$9,947
 $10,393
$12,318
 $9,947
Net sales to equity method investees, the majority of which are located outside the United States, were $8,984 million, $10,063 million and $9,178 million in 2015, 2014 and $7,082 million in 2014, 2013, and 2012, respectively. Total payments, primarily marketing, made to equity method investees were $1,380 million, $1,605 million and $1,807 million in 2015, 2014 and $1,587 million in 2014, 2013, and 2012, respectively. In addition, purchases of finishedbeverage products from equity method investees were $1,131 million, $381 million and $415 million in 2015, 2014 and $392 million2013, respectively. The increase in 2014, 2013 and 2012, respectively.purchases of beverage products in 2015 is primarily due to purchases from Monster. Refer to Note 2 for additional information.

104



If valued at the December 31, 20142015 quoted closing prices of shares actively traded on stock markets, the value of our equity method investments in publicly traded bottlers would have exceeded our carrying value by $5,443$7,225 million.

99



Net Receivables and Dividends from Equity Method Investees
Total net receivables due from equity method investees were $1,4481,399 million and $1,3081,448 million as of December 31, 20142015 and 20132014, respectively. The total amount of dividends received from equity method investees was $398367 million, $401398 million and $393401 million for the years ended December 31, 20142015, 20132014 and 20122013, respectively. Dividends received included a $35 million special dividend from Coca-Cola Hellenic during 2012. We classifiedThe amount of consolidated reinvested earnings that represents undistributed earnings of investments accounted for under the receiptequity method as of the special dividend in cash flows from operating activities because our cumulative equity in earnings from Coca-Cola Hellenic exceeded the cumulative distributions received; therefore, the dividends were deemed to be a return on our investment and not a return of our investment.December 31, 2015 was $3,389 million.
NOTE 7: PROPERTY, PLANT AND EQUIPMENT
The following table summarizes our property, plant and equipment (in millions):
December 31,2014
 2013
2015
 2014
Land$972
 $1,011
$717
 $972
Buildings and improvements5,539
 5,605
4,914
 5,541
Machinery, equipment and vehicle fleet18,225
 17,551
16,723
 18,745
Construction in progress522
 865
$25,258
 $25,032
$22,354
 $25,258
Less accumulated depreciation10,625
 10,065
9,783
 10,625
Property, plant and equipment — net$14,633
 $14,967
$12,571
 $14,633
NOTE 8: INTANGIBLE ASSETS
Indefinite-Lived Intangible Assets
The following table summarizes information related to indefinite-lived intangible assets (in millions):
December 31,2014
 2013
2015
 2014
Trademarks1
$6,533
 $6,744
$5,989
 $6,533
Bottlers' franchise rights2,3
6,689
 7,415
6,000
 6,689
Goodwill12,100
 12,312
11,289
 12,100
Other170
 171
164
 170
Indefinite-lived intangible assets$25,492
 $26,642
$23,442
 $25,492
1 The decrease in 20142015 was primarily due to the resultsale of changes in brand strategies causing certain trademarks to become definite-lived, the transfer of the Company'sour energy brands to assets held for sale and the effect of translation adjustments. This decrease was partially offset by the finalization of purchase accountingMonster, an impairment charge recorded related to the Company's consolidationdiscontinuation of innocentthe energy products in 2013.the glacéau portfolio as a result of the Monster Transaction and the impairment of a Venezuelan trademark primarily due to changes in exchange rates as a result of the establishment of the new open market exchange system. Refer to Note 2 for additional information.information on the Monster Transaction and Note 1 for additional information on the Venezuela currency change.
2 
The decrease in 20142015 was primarily related to North America refranchising.refranchising and the transfer of intangible assets to assets held for sale as a result of our entering into an agreement to merge our German bottling operations to form CCEP. These decreases were partially offset by the acquisition of the Company's rights to distribute Monster products in expanded territories as a result of the Monster Transaction. The carrying value of these rights as of December 31, 2015 was $640 million. These distribution rights are governed by an agreement with an initial term of 20 years, after which it will continue to remain in effect unless otherwise terminated by either party and there are no future costs of renewal. The Company anticipates that these assets will be used indefinitely. Refer to Note 2 for additional information.
3 The Company has agreements with Dr Pepper Snapple Group, Inc. ("DPSG") to distribute Dr Pepper trademark brands in the United States, Canada Dry in the Northeastern United States, and Canada Dry and C' Plus in Canada. As of December 31, 2014,2015, the agreements have remaining terms of 1615 years, with automatic 20-year renewal periods unless otherwise terminated under the terms of the agreements and there are no significant costs to renew the agreements. The Company anticipates using thethat these assets will be used indefinitely. The distribution rights acquired from DPSG are the only significant indefinite-lived intangible assets subject to renewal or extension arrangements. The carrying values of these rights as of December 31, 2015 and 2014, and 2013, were $784$652 million and $865$784 million, respectively. The decrease is related to North America refranchising. Refer to Note 2 for additional information.

100105



The following table provides information related to the carrying value of our goodwill by operating segment (in millions):
Eurasia &
Africa

 Europe
 
Latin
America

 
North
America

 Asia Pacific
 
Bottling
Investments

 Total
Eurasia &
Africa

 Europe
 
Latin
America

 
North
America

 Asia Pacific
 
Bottling
Investments

 Total
2013             
Balance as of January 1$34
 $691
 $168
 $10,577
 $123
 $662
 $12,255
Effect of foreign currency translation(3) 29
 (12) 
 (6) 10
 18
Acquisitions1
5
 102
 
 
 
 20
 127
Adjustments related to the finalization
of purchase accounting1

 
 
 (4) 
 (1) (5)
Impairment2

 
 
 
 
 (82) (82)
Divestitures, deconsolidations and other
 
 
 (1) 
 
 (1)
Balance as of December 31$36
 $822
 $156
 $10,572
 $117
 $609
 $12,312
2014                          
Balance as of January 1$36
 $822
 $156
 $10,572
 $117
 $609
 $12,312
$36
 $822
 $156
 $10,572
 $117
 $609
 $12,312
Effect of foreign currency translation(2) (60) (9) 
 (2) (26) (99)(2) (60) (9) 
 (2) (26) (99)
Acquisitions1

 
 
 11
 16
 3
 30

 
 
 11
 16
 3
 30
Adjustments related to the finalization
of purchase accounting1
(4) (43) 
 
 
 (14) (61)(4) (43) 
 
 
 (14) (61)
Divestitures, deconsolidations and other1
(3) 
 
 (79) 
 
 (82)(3) 
 
 (79) 
 
 (82)
Balance as of December 31$27
 $719
 $147
 $10,504
 $131
 $572
 $12,100
$27
 $719
 $147
 $10,504
 $131
 $572
 $12,100
2015             
Balance as of January 1$27
 $719
 $147
 $10,504
 $131
 $572
 $12,100
Effect of foreign currency translation(7) (98) (24) 
 2
 (37) (164)
Acquisitions1

 
 
 27
 
 
 27
Adjustments related to the finalization
of purchase accounting1

 
 
 
 
 4
 4
Impairment
 
 
 
 
 (4) (4)
Divestitures, deconsolidations and other1,2

 (3) 
 (390) 
 (281) (674)
Balance as of December 31$20
 $618
 $123
 $10,141
 $133
 $254
 $11,289
1
Refer to Note 2 for information related to the Company's acquisitions and divestitures.
2
The decrease in 2015 for the North America operating segment was primarily due to the derecognition of goodwill as a result of the sale of our energy business to Monster and North America refranchising. The 2015 decrease in the Bottling Investments segment was primarily due to the transfer of our German bottling operations to assets held for sale as a result of the Company entering into an agreement to merge the operations to form CCEP. Refer to Note 172 for additional information related to the Company's impairment of goodwill.on these transactions.
Definite-Lived Intangible Assets
The following table summarizes information related to definite-lived intangible assets (in millions):
December 31, 2014 December 31, 2013December 31, 2015 December 31, 2014
Gross Carrying Amount
Accumulated Amortization
Net
 Gross Carrying Amount
Accumulated Amortization
Net
Gross Carrying Amount
Accumulated Amortization
Net
 Gross Carrying Amount
Accumulated Amortization
Net
Customer relationships1
$597
$(229)$368
 $642
$(202)$440
$493
$(199)$294
 $597
$(229)$368
Bottlers' franchise rights1
664
(375)289
 722
(317)405
604
(412)192
 664
(375)289
Trademarks2
222
(39)183
 105
(26)79
Trademarks211
(44)167
 222
(39)183
Other96
(56)40
 128
(83)45
97
(60)37
 96
(56)40
Total$1,579
$(699)$880
 $1,597
$(628)$969
$1,405
$(715)$690
 $1,579
$(699)$880
1 
The decrease in 20142015 was primarily due to the derecognition of intangible assets as a result of the North America refranchising.refranchising and the transfer of our German bottling operations to assets held for sale as a result of the Company entering into an agreement to merge the operations to form CCEP. Refer to Note 2 for additional information.
2
The increase in 2014 was the result of changes in brand strategies causing certain indefinite-lived trademarks to become definite-lived.

106



Total amortization expense for intangible assets subject to amortization was $156 million, $168 million and $165 million in 2015, 2014 and $173 million in 2014, 2013, and 2012, respectively.
Based on the carrying value of definite-lived intangible assets as of December 31, 2014,2015, we estimate our amortization expense for the next five years will be as follows (in millions):
 
Amortization
Expense

 
Amortization
Expense

2015 $156
2016 149
 $149
2017 121
 113
2018 61
 60
2019 59
 57
2020 52

101



NOTE 9: ACCOUNTS PAYABLE AND ACCRUED EXPENSES
Accounts payable and accrued expenses consisted of the following (in millions):
December 31,2014
 2013
2015
 2014
Accrued marketing$2,103
 $2,407
$2,186
 $2,103
Other accrued expenses3,182
 3,515
3,173
 3,182
Trade accounts payable2,089
 1,933
2,795
 2,089
Accrued compensation997
 933
936
 997
Sales, payroll and other taxes511
 450
444
 511
Container deposits352
 339
126
 352
Accounts payable and accrued expenses$9,234
 $9,577
$9,660
 $9,234
NOTE 10: DEBT AND BORROWING ARRANGEMENTS
Short-Term Borrowings
Loans and notes payable consist primarily of commercial paper issued in the United States. As of December 31, 20142015 and 2013,2014, we had $19,010$13,035 million and $16,853$19,010 million, respectively, in outstanding commercial paper borrowings. Our weighted-average interest rates for commercial paper outstanding were approximately 0.20.5 percent and 0.2 percent per year as of December 31, 20142015 and 2013,2014, respectively.
In addition, we had $8,723$9,771 million in lines of credit and other short-term credit facilities as of December 31, 2014.2015. The Company's total lines of credit included $120$95 million that was outstanding and primarily related to our international operations.
Included in the credit facilities discussed above, the Company had $7,677$8,340 million in lines of credit for general corporate purposes. These backup lines of credit expire at various times from 20152016 through 2019. There were no borrowings under these backup lines of credit during 2014.2015. These credit facilities are subject to normal banking terms and conditions. Some of the financial arrangements require compensating balances, none of which is presently significant to our Company.

107



Long-Term Debt
During 2015, the Company issued SFr1,325 million, €8,500 million and $4,000 million of long-term debt. The general terms of the notes issued are as follows:
SFr200 million total principal amount of notes due October 2, 2017, at a fixed interest rate of 0.00 percent;
SFr550 million total principal amount of notes due December 22, 2022, at a fixed interest rate of 0.25 percent;
SFr575 million total principal amount of notes due October 2, 2028, at a fixed interest rate of 1.00 percent;
€2,000 million total principal amount of notes due March 9, 2017, at a variable interest rate equal to the three-month Euro Interbank Offered Rate ("EURIBOR") plus 0.15 percent;
€2,000 million total principal amount of notes due September 9, 2019, at a variable interest rate equal to the three-month EURIBOR plus 0.23 percent;
€1,500 million total principal amount of notes due March 9, 2023, at a fixed interest rate of 0.75 percent;
€1,500 million total principal amount of notes due March 9, 2027, at a fixed interest rate of 1.125 percent;
€1,500 million total principal amount of notes due March 9, 2035, at a fixed interest rate of 1.625 percent;
$750 million total principal amount of notes due October 27, 2017, at a fixed interest rate of 0.875 percent;
$1,500 million total principal amount of notes due October 27, 2020, at a fixed interest rate of 1.875 percent; and
$1,750 million total principal amount of notes due October 27, 2025, at a fixed interest rate of 2.875 percent.
During 2015, the Company retired $3,500 million of long-term debt upon maturity. The Company also extinguished $2,039 million of long-term debt prior to maturity, incurring associated charges of $320 million recorded in the line item interest expense in our consolidated statement of income. These charges included the difference between the reacquisition price and the net carrying amount of the debt extinguished, including the impact of the related fair value hedging relationship. The general terms of the notes that were extinguished were as follows:
$1,148 million total principal amount of notes due November 15, 2017, at a fixed interest rate of 5.35 percent; and
$891 million total principal amount of notes due March 15, 2019, at a fixed interest rate of 4.875 percent.
During 2014, the Company issued $3,537 million of long-term debt. The general terms of the notes issued are as follows:
$1,000 million total principal amount of notes due September 1, 2015, at a variable interest rate equal to the three-month London Interbank Offered Rate ("LIBOR") plus 0.01 percent;
$1,015 million total principal amount of euro notes due September 22, 2022, at a fixed interest rate of 1.125 percent; and
$1,522 million total principal amount of euro notes due September 22, 2026, at a fixed interest rate of 1.875 percent.
During 2014, the Company retired $1,000 million of long-term debt upon maturity.
During 2013, the Company issued $7,500 million of long-term debt. The general terms of the notes issued are as follows:
$500 million total principal amount of notes due March 5, 2015, at a variable interest rate equal to the three-month LIBOR minus 0.02 percent;
$500 million total principal amount of notes due November 1, 2016, at a variable interest rate equal to the three-month LIBOR plus 0.10 percent;
$500 million total principal amount of notes due November 1, 2016, at a fixed interest rate of 0.75 percent;
$1,250 million total principal amount of notes due April 1, 2018, at a fixed interest rate of 1.15 percent;
$1,250 million total principal amount of notes due November 1, 2018, at a fixed interest rate of 1.65 percent;
$1,250 million total principal amount of notes due November 1, 2020, at a fixed interest rate of 2.45 percent;
$750 million total principal amount of notes due April 1, 2023, at a fixed interest rate of 2.50 percent; and
$1,500 million total principal amount of notes due November 1, 2023, at a fixed interest rate of 3.20 percent.

102108



During 2013, the Company retired $1,250 million of debt upon maturity. The Company also extinguished $2,154 million of long-term debt prior to maturity, incurring associated extinguishment charges of $50 million. The general terms of the notes that were extinguished were:
$225 million total principal amount of notes due August 15, 2013, at a fixed interest rate of 5.0 percent;
$675 million total principal amount of notes due March 3, 2014, at a fixed interest rate of 7.375 percent;
$900 million total principal amount of notes due March 15, 2014, at a fixed interest rate of 3.625 percent; and
$354 million total principal amount of notes due March 1, 2015, at a fixed interest rate of 4.25 percent.
During 2012, the Company retired $1,250 million of long-term notes upon maturity and issued $2,750 million of long-term debt. The general terms of the notes issued are as follows:
$1,000 million total principal amount of notes due March 14, 2014, at a variable interest rate equal to the three-month LIBOR minus 0.05 percent;
$1,000 million total principal amount of notes due March 13, 2015, at a fixed interest rate of 0.75 percent; and
$750 million total principal amount of notes due March 14, 2018, at a fixed interest rate of 1.65 percent.
The Company's long-term debt consisted of the following (in millions, except average rate data):
December 31, 2014 December 31, 2013December 31, 2015 December 31, 2014
Amount
 
Average
Rate 1

 Amount
 
Average
Rate1

Amount
 
Average
Rate 1

 Amount
 
Average
Rate1

U.S. dollar notes due 2015–2093$17,433
 1.8% $17,427
 1.8%
U.S. dollar notes due 2016–2093$15,899
 2.1% $17,433
 1.8%
U.S. dollar debentures due 2017–20982,157
 3.9
 2,191
 3.9
2,122
 3.9
 2,157
 3.9
U.S. dollar zero coupon notes due 20202
143
 8.4
 138
 8.4
148
 8.4
 143
 8.4
Euro notes due 2022 and 20263
2,468
 3.7
 
 
Euro notes due 2017–20273
11,364
 0.6
 2,468
 3.7
Swiss franc notes due 2017–20283
1,291
 0.9
 
 
Other, due through 20984
380
 4.0
 370
 4.0
307
 4.2
 380
 4.0
Fair value adjustment5
34
 N/A
 52
 N/A
(47) N/A
 34
 N/A
Total6,7
$22,615
 2.2% $20,178
 2.2%$31,084
 1.7% $22,615
 2.2%
Less current portion3,552
  
 1,024
  
2,677
  
 3,552
  
Long-term debt$19,063
  
 $19,154
  
$28,407
  
 $19,063
  
1 
These rates represent the weighted-average effective interest rate on the balances outstanding as of year end, as adjusted for the effects of interest rate swap agreements, cross currency swap agreements and fair value adjustments, if applicable. Refer to Note 5 for a more detailed discussion on interest rate management.
2 
This amount is shown net of unamortized discounts of $28$23 million and $33$28 million as of December 31, 20142015 and 2013,2014, respectively.
3 
This amount includes adjustments recorded due to changes in foreign currency exchange rates.
4 
As of December 31, 2014,2015, the amount shown includes $199$156 million of debt instruments that are due through 2031.
5 
Amount represents changes in fair value due to changes in benchmark interest rates. Refer to Note 5 for additional information about our fair value hedging strategy.
6 
As of December 31, 20142015 and 2013,2014, the fair value of our long-term debt, including the current portion, was $23,411$31,308 million and $20,352$23,411 million, respectively. The fair value of our long-term debt is estimated based on quoted prices for those or similar instruments.
7 
The above notes and debentures include various restrictions, none of which is presently significant to our Company.
The carrying value of the Company's long-term debt included fair value adjustments related to the debt assumed from Coca-Cola Enterprises Inc.'s ("Old CCE") former North America business in 2010 of $464411 million and $514464 million as of December 31, 20142015 and 20132014, respectively. These fair value adjustments are being amortized over the number of years remaining until the underlying debt matures. As of December 31, 20142015, the weighted-average maturity of the assumed debt to which these fair value adjustments relate was approximately 20 years. The amortization of these fair value adjustments will be a reduction of interest expense in future periods, which will typically result in our interest expense being less than the actual interest paid to service the debt.
Total interest paid was $498515 million, $498 million and $574498 million in 20142015, 20132014 and 20122013, respectively.

103



Maturities of long-term debt for the five years succeeding December 31, 20142015, are as follows (in millions):
Maturities of
Long-Term Debt

Maturities of
Long-Term Debt

2015$3,552
20162,689
$2,677
20171,363
3,368
20183,308
3,302
20191,004
2,294
20203,927

109



NOTE 11: COMMITMENTS AND CONTINGENCIES
Guarantees
As of December 31, 20142015, we were contingently liable for guarantees of indebtedness owed by third parties of $565572 million, of which $155263 million was related to VIEs. Refer to Note 1 for additional information related to the Company's maximum exposure to loss due to our involvement with VIEs. Our guarantees are primarily related to third-party customers, bottlers, vendors and container manufacturing operations and have arisen through the normal course of business. These guarantees have various terms, and none of these guarantees was individually significant. The amount represents the maximum potential future payments that we could be required to make under the guarantees; however, we do not consider it probable that we will be required to satisfy these guarantees.
We believe our exposure to concentrations of credit risk is limited due to the diverse geographic areas covered by our operations.
Legal Contingencies
The Company is involved in various legal proceedings. We establish reserves for specific legal proceedings when we determine that the likelihood of an unfavorable outcome is probable and the amount of loss can be reasonably estimated. Management has also identified certain other legal matters where we believe an unfavorable outcome is reasonably possible and/or for which no estimate of possible losses can be made. Management believes that the total liabilities to the Company that may arise as a result of currently pending legal proceedings will not have a material adverse effect on the Company taken as a whole.
Indemnifications
At the time we acquire or divest our interest in an entity, we sometimes agree to indemnify the seller or buyer for specific contingent liabilities. Management believes that any liability to the Company that may arise as a result of any such indemnification agreements will not have a material adverse effect on the Company taken as a whole.
Tax Audits
The Company is involved in various tax matters, with respect to some of which the outcome is uncertain. These audits may result in the assessment of additional taxes that are subsequently resolved with authorities or potentially through the courts. Refer to Note 14.
On September 17, 2015, the Company received a Statutory Notice of Deficiency ("Notice") from the Internal Revenue Service ("IRS") for the tax years 2007 through 2009, after a five-year audit. In the Notice, the IRS claims that the Company's United States taxable income should be increased by an amount that creates a potential additional federal income tax liability of approximately $3.3 billion for the period, plus interest. No penalties were asserted in the Notice; however, the IRS has since taken the position that it is not precluded from asserting penalties and notified the Company that it may do so. The disputed amounts largely relate to a transfer pricing matter involving the appropriate amount of taxable income the Company should report in the United States in connection with its licensing of intangible property to certain related foreign licensees regarding the manufacturing, distribution, sale, marketing and promotion of products in overseas markets.
The Company has followed the same transfer pricing methodology for these licenses since the methodology was agreed with the IRS in a 1996 closing agreement that applied back to 1987. The closing agreement provides prospective penalty protection as long as the Company follows the prescribed methodology and material facts and circumstances and relevant Federal tax law have not changed. On February 11, 2016, the IRS notified the Company, without further explanation, that the IRS has determined that material facts and circumstances and relevant Federal tax law have changed and that it may assert penalties. The Company does not agree with this determination. The Company's compliance with the closing agreement was audited and confirmed by the IRS in five successive audit cycles covering the subsequent 11 years through 2006, with the last audit concluding as recently as 2009.
The Notice represents a repudiation of the methodology previously adopted in the 1996 closing agreement. The IRS designated the matter for litigation on October 15, 2015. Therefore, the Company will be prevented from pursuing any administrative settlement at IRS Appeals or under the IRS Advance Pricing and Mutual Agreement Program.

110



The Company firmly believes that the IRS' claims are without merit and plans to pursue all available administrative and judicial remedies necessary to resolve this matter. To that end, the Company filed a petition in the U.S. Tax Court on December 14, 2015. The Company intends to vigorously defend its position and is confident in its ability to prevail on the merits. The Company regularly assesses the likelihood of adverse outcomes resulting from examinations such as this to determine the adequacy of its tax reserves. The Company believes that the final adjudication of this matter will not have a material impact on its consolidated financial position, results of operations or cash flows and that it has adequate tax reserves for all tax matters. However, the ultimate outcome of disputes of this nature is uncertain, and if the IRS were to prevail on its assertions, the additional tax, interest, and any potential penalties could have a material adverse impact on the Company's financial position, results of operations or cash flows.
Risk Management Programs
The Company has numerous global insurance programs in place to help protect the Company from the risk of loss. In general, we are self-insured for large portions of many different types of claims; however, we do use commercial insurance above our self-insured retentions to reduce the Company's risk of catastrophic loss. Our reserves for the Company's self-insured losses are estimated through actuarial procedures of the insurance industry and by using industry assumptions, adjusted for our specific expectations based on our claim history. The Company's self-insurance reserves totaled $530560 million and $537530 million as of December 31, 20142015 and 20132014, respectively.
Workforce (Unaudited)
We refer to our employees as "associates." As of December 31, 20142015, our Company had approximately 129,200123,200 associates, of which approximately 65,30060,900 associates were located in the United States. Our Company, through its divisions and subsidiaries, is a party to numerous collective bargaining agreements. As of December 31, 20142015, approximately 18,00017,500 associates, excluding seasonal hires, in North America were covered by collective bargaining agreements. These agreements typically have terms of three years to five years years.. We currently expect that we will be able to renegotiate such agreements on satisfactory terms when they expire. The Company believes that its relations with its associates are generally satisfactory.

104



Operating Leases
The following table summarizes our minimum lease payments under noncancelable operating leases with initial or remaining lease terms in excess of one year as of December 31, 20142015 (in millions):
Year Ended December 31,Operating Lease Payments
Operating Lease Payments
2015$230
2016161
$171
2017128
109
201898
89
201971
68
202059
Thereafter277
220
Total minimum operating lease payments1
$965
$716
1 
Income associated with sublease arrangements is not significant.
NOTE 12: STOCKSTOCK-BASED COMPENSATION PLANS
Our Company grants stock options and restricted stock awards under its stock-based compensation plans to certain employees of the Company. Total stock-based compensation expense was $236 million, $209 million and $227 million in 2015, 2014 and $259 million in 2014, 2013, and 2012, respectively, and was included as a component of selling, general and administrative expenses in our consolidated statements of income. The total income tax benefit recognized in our consolidated statements of income related to stock-based compensation arrangementsawards under these plans was $65 million, $57 million and $62 million in 2015, 2014 and $72 million2013, respectively. Beginning in 2014, 2013 and 2012, respectively.2015, certain employees who had previously been eligible for long-term equity awards received long-term performance cash awards. Employees who receive these performance cash awards do not receive equity awards as part of the long-term incentive program.
As of December 31, 2014,2015, we had $437$319 million of total unrecognized compensation cost related to nonvested share-basedstock-based compensation arrangementsawards granted under our plans. This cost is expected to be recognized over a weighted-average period of 2.21.8 years as stock-based compensation expense. This expected cost does not include the impact of any future stock-based compensation awards.

111



The Coca-Cola Company 2014 Equity Plan (the "2014("2014 Equity Plan") was approved by shareowners in April 2014. Under the 2014 Equity Plan, a maximum of 500 million shares of our common stock was approved to be issued, through the grant of equity awards, to certain employees. As of December 31, 2014, no grants have been made under theThe 2014 Equity Plan.Plan allows for grants of stock options, performance share units, restricted stock units, restricted stock and other specified award types including cash awards with performance-based vesting criteria. Beginning in 2015, the 2014 Equity Plan will bewas the primary plan in use for equity awards and performance cash awards. There were no grants made from the 2014 Equity Plan prior to 2015. As of December 31, 2015, there were 471.6 million shares available to be granted under the 2014 Equity Plan. In addition to the 2014 Equity Plan, there were 2.7 million shares available to be granted under stock option plans approved by shareowners in 1999 and 2008 and 0.2 million shares available to be granted under a restricted stock award plan approved by shareowners in 1989.
Stock Option PlansAwards
Stock options have generally been granted with an exercise price equal to the Company's stock price on the date of grant. The fair value of our stockeach option grantsaward is estimated using a Black-Scholes-Merton option-pricing model and is amortized over the vesting period, generally four years. The fair value of each option award is estimated on the grant date using a Black-Scholes-Merton option-pricing model.
The weighted-average fair value of options granted during the past three years and the weighted-average assumptions used in the Black-Scholes-Merton option-pricing model for such grants were as follows:
2014
 2013
 2012
2015
 2014
 2013
Fair value of options at grant date$3.91
 $3.73
 $3.80
$4.38
 $3.91
 $3.73
Dividend yield1
2.7% 2.8% 2.7%3.1% 2.7% 2.8%
Expected volatility2
16.0% 17.0% 18.0%16.0% 16.0% 17.0%
Risk-free interest rate3
1.6% 0.9% 1.0%1.8% 1.6% 0.9%
Expected term of the option4
5 years
 5 years
 5 years
6 years
 5 years
 5 years
1 
The dividend yield is the calculated yield on the Company's stock at the time of the grant.
2 
Expected volatility is based on implied volatilities from traded options on the Company's stock, historical volatility of the Company's stock and other factors.
3 
The risk-free interest rate for the period matching the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of the grant.
4 
The expected term of the option represents the period of time that options granted are expected to be outstanding and is derived by analyzing historical exercise behavior.

105



Generally, stock options granted from 1999 through July 2003 expire 15 years from the date of grant and stock options granted in December 2003 and thereafter expire 10 years years from the date of grant. The shares of common stock to be issued and/or sold under theupon exercise of stock option plansoptions are made available from either authorized and unissued Company common stock or from the Company's treasury shares. In 2007, the Company began issuing common stock under these plans from the Company's treasury shares.
In addition to the 2014 Equity Plan discussed above, the Company had the following stock option plans as of December 31, 2014:
The Coca-Cola Company 1999 Stock Option Plan (the "1999 Option Plan") was approved by shareowners in April 1999. Under the 1999 Option Plan, a maximum of 240 million shares of our common stock was approved to be issued, through the grant of stock options, to certain officers and employees.
The Coca-Cola Company 2002 Stock Option Plan (the "2002 Option Plan") was approved by shareowners in April 2002. An amendment to the 2002 Option Plan which permitted the issuance of stock appreciation rights was approved by shareowners in April 2003. Under the 2002 Option Plan, a maximum of 240 million shares of our common stock was approved to be issued, through the grant of stock options or stock appreciation rights, to certain officers and employees. No stock appreciation rights have been issued under the 2002 Option Plan as of December 31, 2014. There are no longer any shares available for grant from the 2002 Option Plan.
The Coca-Cola Company 2008 Stock Option Plan (the "2008 Option Plan") was approved by shareowners in April 2008. Under the 2008 Option Plan, a maximum of 280 million shares of our common stock was approved to be issued, through the grant of stock options, to certain officers and employees.
As a result of our acquisition of CCE's former North America business, the Company assumed certain stock-based compensation plans previously sponsored by CCE. The assumed Coca-Cola Enterprises Inc. 2001 Stock Option Plan, Coca-Cola Enterprises Inc. 2004 Stock Award Plan and Coca-Cola Enterprises Inc. 2007 Incentive Award Plan previously sponsored by CCE have approximately 1.4 million shares outstanding after conversion of CCE common stock into our common stock. The Company has not granted any equity awards from the assumed plans since the acquisition, and as of December 31, 2014, no shares remain available for grant.
As of December 31, 2014, there were 2.7 million shares available to be granted under the 1999 Option Plan and 2008 Option Plan. Options to purchase common stock under these plans have generally been granted at the fair market value of the Company's stock at the date of grant.
Stock option activity for all stock option plans for the year ended December 31, 2014,2015, was as follows:
 
Shares
(In millions)

 
Weighted-Average
Exercise Price

 
Weighted-Average
Remaining
Contractual Life
 
Aggregate
Intrinsic Value
(In millions)

Outstanding on January 1, 2014305
 $29.42
    
Granted68
 37.24
    
Exercised(58) 26.12
    
Forfeited/expired(10) 35.03
    
Outstanding on December 31, 20141
305
 $31.60
 6.07 years $3,241
Expected to vest at December 31, 2014300
 $31.51
 6.03 years $3,216
Exercisable on December 31, 2014173
 $27.85
 4.35 years $2,480
 
Shares
(In millions)

 
Weighted-Average
Exercise Price

 
Weighted-Average
Remaining
Contractual Life
 
Aggregate
Intrinsic Value
(In millions)

Outstanding on January 1, 2015305
 $31.60
    
Granted13
 41.89
    
Exercised(44) 28.31
    
Forfeited/expired(8) 36.53
    
Outstanding on December 31, 20151
266
 $32.51
 5.55 years $2,786
Expected to vest264
 $32.45
 5.53 years $2,775
Exercisable on December 31, 2015178
 $29.92
 4.43 years $2,317
1 
Includes 1.41.0 million stock option replacement awards in connection with our acquisition of Old CCE's former North America business in 2010. These options had a weighted-average exercise price of $16.6216.26 and generally vest over 3 years and expire 10 years from the original date of grant.

112



The total intrinsic value of the options exercised was $594 million, $894 million and $815 million in 2015, 2014 and $780 million in 2014, 2013, and 2012, respectively. The total shares exercised were 44 million, 58 million and 53 million in 2015, 2014 and 61 million in 2014, 2013, and 2012, respectively.
Restricted Stock Award Plans
Under The Coca-Cola Company 1989 Restricted Stock Award Plan and The Coca-Cola Company 1983 Restricted Stock Award Plan (the "Restricted Stock Award Plans"), 80 million and 48 million shares of restricted common stock, respectively, were originally available to be granted to certain officers and key employees of our Company. As of December 31, 2014, 0.2 million shares remain available for grant under the Restricted Stock Award Plans. The Company issues restricted stock to employees as a result of performance share unit awards, time-based awards and performance-based awards.

106



For awards prior to January 1, 2008, under the 1983 Restricted Stock Award Plan, participants are reimbursed by our Company for income taxes imposed on the award, but not for taxes generated by the reimbursement payment. The 1983 Restricted Stock Award Plan has been amended to eliminate this tax reimbursement for awards after January 1, 2008. The shares are subject to certain transfer restrictions and may be forfeited if a participant leaves our Company for reasons other than retirement, disability or death, absent a change in control of our Company.
Performance Share Unit Awards
In 2003, the Company established a program to grant performance share units under The Coca-Cola Company 1989 Restricted Stock Award Plan to executives. In 2008, the Company expanded the program to award a mix of stock options and performance share units to a broader group of eligible employees. Performance share units under The Coca-Cola Company 1989 Restricted Stock Award Plan require achievement of certain performance criteria, which are predefined by the Compensation Committee of the Board of Directors at the time of grant. The primary performance criteriacriterion used is compound annual growth in economic profit over a predefined performance period, which is generally three years. The compound annual growthEconomic profit is our net operating profit after tax less the cost of the capital used in economicour business. Beginning in 2015, the Company added net operating revenues as an additional performance criterion. Economic profit which isand net operating revenues are adjusted for certain items, iswhich are approved and certified by the Audit Committee of the Board of Directors. The purpose of these adjustments is to ensure a consistent year to yearyear-to-year comparison of the specific performance criteria. Economic profit is our net operating profit after tax less the cost of the capital used in our business. In the event the certified results equal the predefined performance criteria, the Company will grant the number of restricted shares or share units equal to the target award in the underlying performance share unit agreements.award. In the event the certified results exceed the predefined performance criteria, additional restricted shares or share units up to the maximum award maywill be granted. In the event the certified results fall below the predefined performance criteria, a reduced number of restricted shares or share units maywill be granted. If the certified results fall below the threshold award performance level, no restricted shares or share units will be granted. The restricted shares orperformance share units granted under this program are then generally subject to a holding period of one year before the restricted shares or share units are released. For performance share units granted before 2008, this holding period was generally two years. For performance share units granted in 2008 and after, this holding period is generally one year. Restrictions on such shares or share units lapse at the end of the holding period.
Performance share units generally do not pay dividends or allow voting rights during the performance period.rights. For awards granted prior to 2011, participants generally are entitled to dividends or dividend equivalents once the performance criteria have been certified and the restricted shares or share units have been issued. For awards granted in 2011 and later, participants generally are entitled to receive dividends or dividend equivalents once the shares have been released. Accordingly, the fair value of the performance share units is the quoted market value of the Company stock on the grant date less the present value of the expected dividends not received during the relevant period. For certainmost performance share units granted beginning in 2014, the Company includes a relative TSR modifier to determine the number of restricted shares or share units earned at the end of the performance period. For these awards, the number of restricted shares or share units earned based on the certified achievement of the predefined performance criteria will be reduced or increased if total shareowner return over the performance period relative to a predefined compensation comparator group of companies falls outside of a defined range. The fair value of performance share units that include the TSR modifier is determined using a Monte Carlo valuation model. For the remaining awards that do not include the TSR modifier, the fair value of the performance share units is the quoted market value of the Company stock on the grant date less the present value of the expected dividends not received during the relevant period.
In the period it becomes probable that the minimum performance criteria specified in the plan will be achieved, we recognize expense for the proportionate share of the total fair value of the performance share units related to the vesting period that has already lapsed for the shares expected to vest and be released. The remaining fair value of the shares expected to vest and be released is expensed on a straight-line basis over the balance of the vesting period. In the event the Company determines it is no longer probable that we will achieve the minimum performance criteria specified in the plan, we reverse all of the previously recognized compensation expense in the period such a determination is made.
Performance share units are generally settled in stock, except for certain circumstances such as death or disability, in which case former employees or their beneficiaries are provided a cash equivalent payment. As of December 31, 2014,2015, performance share units of 6,017,000, 5,608,0005,115,000, 5,306,000 and 5,801,0001,775,000 were outstanding for the 2012–2014, 2013–2015, 2014–2016 and 2014–20162015–2017 performance periods, respectively, based on the target award amounts in the performance share unit agreements.

107



The following table summarizes information about performance share units based on the target award amounts in the performance share unit agreements:
 
Share Units
(In thousands)

 
Weighted-Average
Grant Date
Fair Value

Outstanding on January 1, 201417,974
 $30.41
Granted6,117
 32.33
Paid in cash equivalent(5) 30.59
Canceled/forfeited(6,660) 29.11
Outstanding on December 31, 20141
17,426
 $31.59
 
Performance Share Units
(In thousands)

 
Weighted-Average
Grant Date
Fair Value

Outstanding on January 1, 201517,426
 $31.59
Granted1
1,857
 37.99
Canceled/forfeited(7,087) 30.32
Outstanding on December 31, 20152
12,196
 $33.30
1
Includes 70 percent of the total 2015 award. The remaining 30 percent of the 2015 award contained metrics that cannot be fully defined until 2017; therefore, these awards are not considered granted until all of the metrics are established.
2 
The outstanding performance share units as of December 31, 2014,2015, at the threshold award and maximum award levels were 8.75.0 million and 26.120.9 million, respectively.

113



The weighted-average grant date fair value of performance share units granted was $37.99 in 2015, $32.33 in 2014 and $32.67 in 2013 and $29.952013. The Company did not convert any performance share units into cash equivalent payments in 2012.2015. The Company converted performance share units of 5,403 in 2014 and 54,999 in 2013 and 16,267 in 2012 to cash equivalent payments of $0.2 million $1.8 million and $0.6$1.8 million, respectively, to former employees who were ineligible for restricted stock grantsor their beneficiaries due to certain events such as death or disability.
The following table summarizes information about nonvestedperformance share units that were previously converted to restricted stock andor restricted stock units:
 
Restricted Stock and Stock Units
(In thousands)

 
Weighted-Average
Grant Date
Fair Value1

Nonvested on January 1, 20142
7,014
 $25.17
Vested and released(6,774) 25.17
Canceled/forfeited(110) 25.17
Nonvested on December 31, 20142
130
 $25.17
 
Restricted Stock and Restricted Stock Units
(In thousands)

 
Weighted-Average
Grant Date
Fair Value1

Nonvested on January 1, 20152
130
 $25.17
Vested and released(130) 25.17
Nonvested on December 31, 2015
 $
1 
The weighted-average grant date fair value is based on the fair values of the performance share units granted.
2 
The nonvested restricted stock and stock units as of January 1, 2014, and December 31, 2014,2015 are presented at the performance share units' certified award level.
The total intrinsic value of restricted shares that were vested and released was $2555 million, $16255 million and $14816 million in 20142015, 20132014 and 20122013, respectively. The total restricted share units vested and released in 20142015 were 6,773,934130,017 at the certified award level. In 20132014 and 20122013, the total restricted share units vested and released were 405,9636,773,934 and 4,301,732405,963, respectively.
Replacement performance share unit awards issued by the Company in connection with our acquisition of CCE's former North America business are not included in the tables or discussions above and were originally granted under the Coca-Cola Enterprises Inc. 2007 Incentive Award Plan. These awards were converted into equivalent share units of the Company's common stock on the acquisition date and entitle the participant to dividend equivalents (which vest, in some cases, only if the restricted share units vest), but not the right to vote. Accordingly, the fair value of these units was the quoted value of the Company's stock at the grant date.
On the acquisition date, the Company issued 3.3 million replacement performance share unit awards at target with a weighted-average grant date price of $29.56 per share that were either projected to pay out at, or previously certified at, a payout rate of 200 percent. In accordance with accounting principles generally accepted in the United States, the portion of the fair value of the replacement awards related to services provided prior to the acquisition was included in the total purchase price. The portion of the fair value associated with future service was recognized as expense in the fourth quarter of 2010. The Company released shares with an intrinsic value of $5 million and $22 million in 2013 and 2012, respectively. As of December 31, 2014, the Company had no remaining outstanding replacement performance share units.

108



Time-Based and Performance-Based Restricted Stock and Restricted Stock Unit Awards
The Coca-Cola Company 1989 Restricted Stock Award Plan allows forPrior to the grant ofrelease date, time-based and performance-based restricted stock and restricted stock units. The performance-based restricted awards are released only uponunits granted from the achievement of specific measurable performance criteria. These awards2014 Equity Plan do not pay dividends duringor have voting rights and will be forfeited in the performance period. Ifevent of the performance targetsrecipient's termination of employment, except for reasons such as death or disability. Certain other time-based restricted stock awards entitled participants to vote and receive dividends, while for time-based restricted stock units, participants may receive payment of dividend equivalents but are not met, the awards will be canceled. In the period it becomes probable that the performance criteria will be achieved, we recognize expense for the proportionate share of the totalallowed to vote. The fair value of the shares expected to vestrestricted stock and be released related to the vesting period that has already lapsed. The remaining fair value of the sharesrestricted stock units expected to vest and be released is expensed on a straight-line basis over the balance of the vesting period.
For time-based and performance-based restricted stock awards, participants are entitled to vote and receive dividends on the restricted shares. The Company also awards time-based and performance-based restricted stock units for which participants may receive payments of dividend equivalents but are not entitled to vote. As of December 31, 2014,2015, the Company had outstanding nonvested time-based and performance-based restricted stock, awards, including restricted stock units, of 571,399 and 57,200, respectively. Time-based and performance-based restricted stock awards were941,205, most of which do not significant to our consolidated financial statements.
In 2010, the Company issued time-based restricted stock replacement awards, including restricted stock units, in connection with our acquisition of CCE's former North America business. These awards were converted into equivalent shares of the Company's common stock. These restricted share awards entitle the participant to dividend equivalents (which vest, in some cases, only if the restricted share unit vests), but not the right to vote. As of December 31, 2014, the Company had no outstanding nonvested time-based restricted stock replacement awards, including restricted stock units.pay dividends or have voting rights.
NOTE 13: PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS
Our Company sponsors and/or contributes to pension and postretirement health care and life insurance benefit plans covering substantially all U.S. employees. We also sponsor nonqualified, unfunded defined benefit pension plans for certain associates. In addition, our Company and its subsidiaries have various pension plans and other forms of postretirement arrangements outside the United States.
We refer to the funded defined benefit pension plan in the United States that is not associated with collective bargaining organizations as the "primary U.S. plan." As of December 31, 2014,2015, the primary U.S. plan represented 5859 percent and 6162 percent of the Company's consolidated projected benefit obligation and pension assets, respectively.
In December 2013, the Company modified The Coca-Cola Company Retiree Health Plan. Effective January 1, 2015, the current prescription drug plan will be replaced by a Company-sponsored Medicare Part D Plan. The change reduced the accumulated postretirement benefit obligation of the plan by approximately $71 million. The Coca-Cola Refreshments Welfare Plan for Retirees will not be impacted by this change because of variations in the design of the plan.

109114



Obligations and Funded Status
The following table sets forth the changes in benefit obligations and the fair value of plan assets for our benefit plans (in millions):
Pension Benefits  
 
Other Benefits  
Pension Benefits  
 
Other Benefits  
2014
 2013
 2014
 2013
Year Ended December 31,2015
 2014
 2015
 2014
Benefit obligation at beginning of year1
$8,845
 $9,693
 $946
 $1,104
$10,346
 $8,845
 $1,006
 $946
Service cost261
 280
 26
 36
265
 261
 27
 26
Interest cost406
 378
 43
 42
379
 406
 37
 43
Foreign currency exchange rate changes(183) (69) (4) (2)(309) (183) (14) (4)
Amendments
 (1) (31) (73)6
 
 (10) (31)
Actuarial loss (gain)1,519
 (899) 88
 (91)(479) 1,519
 (54) 88
Benefits paid2
(522) (538) (62) (77)(353) (522) (59) (62)
Business combinations4
 
 
 
1
 4
 
 
Settlements(7) (9) (1) 
Divestitures3
(218) 
 
 
Settlements4
(499) (7) 
 (1)
Special termination benefits5
 2
 
 
21
 5
 2
 
Other18
 8
 1
 7
(1) 18
 5
 1
Benefit obligation at end of year1
$10,346
 $8,845
 $1,006
 $946
$9,159
 $10,346
 $940
 $1,006
Fair value of plan assets at beginning of year$8,746
 $7,584
 $243
 $202
$8,902
 $8,746
 $246
 $243
Actual return on plan assets574
 1,043
 2
 40
(44) 574
 (3) 2
Employer contributions214
 639
 
 
121
 214
 
 
Foreign currency exchange rate changes(203) (43) 
 
(322) (203) 
 
Benefits paid(435) (474) (3) (2)(270) (435) (3) (3)
Settlements(1) (5) 
 
Divestitures3
(206) 
 
 
Settlements4
(486) (1) 
 
Other7
 2
 4
 3
(6) 7
 5
 4
Fair value of plan assets at end of year$8,902
 $8,746
 $246
 $243
$7,689
 $8,902
 $245
 $246
Net liability recognized$(1,444) $(99) $(760) $(703)$(1,470) $(1,444) $(695) $(760)
1 
For pension benefit plans, the benefit obligation is the projected benefit obligation. For other benefit plans, the benefit obligation is the accumulated postretirement benefit obligation. The accumulated benefit obligation for our pension plans was $10,028$8,868 million and $8,523$10,028 million as of December 31, 20142015 and 2013,2014, respectively.
2 
Benefits paid to pension plan participants during 2015 and 2014 and 2013 included $87$83 million and $64$87 million, respectively, in payments related to unfunded pension plans that were paid from Company assets. Benefits paid to participants of other benefit plans during 2015 and 2014 and 2013 included $59$56 million and $75$59 million, respectively, that were paid from Company assets.
3
Divestitures are primarily related to the transfer of assets and liabilities associated with the Company's consolidated German bottling operations to assets held for sale and liabilities held for sale as of December 31, 2015. Refer to Note 2 for additional information.
4
Settlements are primarily related to the Company's productivity, restructuring and integration initiatives. Refer to Note 18.
Pension and other benefit amounts recognized in our consolidated balance sheets are as follows (in millions):
Pension Benefits  
 
Other Benefits  
Pension Benefits  
 
Other Benefits  
December 31,2014
 2013
 2014
 2013
2015
 2014
 2015
 2014
Noncurrent asset$479
 $1,067
 $
 $
$454
 $479
 $
 $
Current liability(78) (76) (20) (21)(72) (78) (21) (20)
Long-term liability(1,845) (1,090) (740) (682)(1,852) (1,845) (674) (740)
Net liability recognized$(1,444) $(99) $(760) $(703)$(1,470) $(1,444) $(695) $(760)

115



Certain of our pension plans have projected benefit obligations in excess of the fair value of plan assets. For these plans, the projected benefit obligations and the fair value of plan assets were as follows (in millions):
December 31,2014
 2013
2015
 2014
Projected benefit obligation$8,753
 $1,521
$7,767
 $8,753
Fair value of plan assets6,854
 374
5,865
 6,854

110



Certain of our pension plans have accumulated benefit obligations in excess of the fair value of plan assets. For these plans, the accumulated benefit obligations and the fair value of plan assets were as follows (in millions):
December 31,2014
 2013
2015
 2014
Accumulated benefit obligation$8,501
 $1,446
$7,537
 $8,501
Fair value of plan assets6,820
 351
5,846
 6,820
Pension Plan Assets
The following table presents total assets for our U.S. and non-U.S. pension plans (in millions):
U.S. Plans  
 
Non-U.S. Plans  
U.S. Plans  
 
Non-U.S. Plans  
December 31,2014
 2013
 2014
 2013
2015
 2014
 2015
 2014
Cash and cash equivalents$186
 $240
 $75
 $274
$222
 $186
 $54
 $75
Equity securities:              
U.S.-based companies1,274
 1,422
 542
 280
1,118
 1,274
 445
 542
International-based companies558
 698
 505
 586
398
 558
 419
 505
Fixed-income securities:              
Government bonds455
 464
 411
 304
442
 455
 295
 411
Corporate bonds and debt securities1,379
 1,369
 187
 137
1,037
 1,379
 136
 187
Mutual, pooled and commingled funds1
863
 1,134
 400
 453
713
 863
 410
 400
Hedge funds/limited partnerships756
 526
 43
 17
723
 756
 41
 43
Real estate391
 245
 17
 6
462
 391
 2
 17
Other481
 245
 379
 346
513
 481
 259
 379
Total pension plan assets2
$6,343
 $6,343
 $2,559
 $2,403
$5,628
 $6,343
 $2,061
 $2,559
1 
Mutual, pooled and commingled funds include investments in equity securities, fixed-income securities and combinations of both. There are a significant number of mutual, pooled and commingled funds from which investors can choose. The selection of the type of fund is dictated by the specific investment objectives and needs of a given plan. These objectives and needs vary greatly between plans.
2 
Fair value disclosures related to our pension assets are included in Note 16. Fair value disclosures include, but are not limited to, the levels within the fair value hierarchy in which the fair value measurements in their entirety fall; a reconciliation of the beginning and ending balances of Level 3 assets; and information about the valuation techniques and inputs used to measure the fair value of our pension assets.

116



Investment Strategy for U.S. Pension Plans
The Company utilizes the services of investment managers to actively manage the assets of our U.S. pension plans. We have established asset allocation targets and investment guidelines with each investment manager. Our asset allocation targets promote optimal expected return and volatility characteristics given the long-term time horizon for fulfilling the obligations of the plan. Selection of the targeted asset allocation for U.S. plan assets was based upon a review of the expected return and risk characteristics of each asset class, as well as the correlation of returns among asset classes. During 2012, the Company revised the asset allocation targets and restructured the investment manager composition to further diversify investment risk and reduce volatility while maintaining our long-term return objectives. Our revised target allocation is a mix of 42 percent equity investments, 30 percent fixed-income investments and 28 percent alternative investments. We believe this target allocation will enable us to achieve the following long-term investment objectives:
(1)optimize the long-term return on plan assets at an acceptable level of risk;
(2)maintain a broad diversification across asset classes and among investment managers; and
(3)maintain careful control of the risk level within each asset class.
The guidelines that have been established with each investment manager provide parameters within which the investment managers agree to operate, including criteria that determine eligible and ineligible securities, diversification requirements and credit quality standards, where applicable. Unless exceptions have been approved, investment managers are prohibited from buying or selling commodities, futures or option contracts, as well as from short selling of securities. Additionally, investment managers agree to obtain written approval for deviations from stated investment style or guidelines. As of December 31, 2014,2015, no investment manager was responsible for more than 108 percent of total U.S. plan assets.

111



Our target allocation of 42 percent equity investments is composed of 60 percent global equities, 16 percent emerging market equities and 24 percent domestic small- and mid-cap equities. Optimal returns through our investments in global equities are achieved through security selection as well as country and sector diversification. Investments in the common stock of our Company accounted for approximately 56 percent of our total global equities allocation and approximately 23 percent of total U.S. plan assets. Our investments in global equities are intended to provide diversified exposure to both U.S. and non-U.S. equity markets. Our investments in both emerging market equities and domestic small- and mid-cap equities are expected tomay experience largerlarge swings in their market value on a periodic basis. Our investments in these asset classes are selected based on capital appreciation potential.
Our target allocation of 30 percent fixed-income investments is composed of 33 percent long-duration bonds and 67 percent with multi-strategy alternative credit managers. Long-duration bonds are intended to provide a stable rate of return through investments in high-quality publicly traded debt securities. Our investments in long-duration bonds are diversified in order to mitigate duration and credit exposure. Multi-strategy alternative credit managers invest in a combination of high-yield bonds, bank loans, structured credit and emerging market debt. These investments are in lower-rated and non-rated debt securities, which generally produce higher returns compared to long-duration bonds and also help to diversify our overall fixed-income portfolio.
In addition to equity investments and fixed-income investments, we have a target allocation of 28 percent in alternative investments. These alternative investments include hedge funds, reinsurance, private equity limited partnerships, leveraged buyout funds, international venture capital partnerships and real estate. The objective of investing in alternative investments is to provide a higher rate of return than that available from publicly traded equity securities. These investments are inherently illiquid and require a long-term perspective in evaluating investment performance.
Investment Strategy for Non-U.S. Pension Plans
As of December 31, 2014,2015, the long-term target allocation for 5971 percent of our international subsidiaries' plan assets, primarily certain of our European and Canadian plans, is 6661 percent equity securities; 2325 percent fixed-income securities; and 1114 percent other investments. The actual allocation for the remaining 4129 percent of the Company's international subsidiaries' plan assets consisted of 3456 percent mutual, pooled and commingled funds; 101 percent equity securities; 133 percent fixed-income securities; and 4340 percent other investments. The investment strategies of our international subsidiaries differ greatly, and in some instances are influenced by local law. None of our pension plans outside the United States is individually significant for separate disclosure.

117



Other Postretirement Benefit Plan Assets
Plan assets associated with other postretirement benefits primarily represent funding of one of the U.S. postretirement benefit plans through a U.S. Voluntary Employee Beneficiary Association ("VEBA"), a tax-qualified trust. The VEBA assets remain segregated from the U.S. pension master trust and are primarily invested in liquid assets due to the level and timing of expected future benefit payments.
The following table presents total assets for our other postretirement benefit plans (in millions):
December 31,2014
 2013
2015
 2014
Cash and cash equivalents$10
 $10
$8
 $10
Equity securities:      
U.S.-based companies114
 112
116
 114
International-based companies7
 8
6
 7
Fixed-income securities:      
Government bonds79
 79
80
 79
Corporate bonds and debt securities9
 9
8
 9
Mutual, pooled and commingled funds16
 18
15
 16
Hedge funds/limited partnerships5
 3
5
 5
Real estate3
 2
3
 3
Other3
 2
4
 3
Total other postretirement benefit plan assets1
$246
 $243
$245
 $246
1 
Fair value disclosures related to our other postretirement benefit plan assets are included in Note 16. Fair value disclosures include, but are not limited to, the levels within the fair value hierarchy in which the fair value measurements in their entirety fall; a reconciliation of the beginning and ending balances of Level 3 assets;fall and information about the valuation techniques and inputs used to measure the fair value of our other postretirement benefit plan assets.

112



Components of Net Periodic Benefit Cost
Net periodic benefit cost for our pension and other postretirement benefit plans consisted of the following (in millions):
Pension Benefits  
 
Other Benefits  
Pension Benefits  
 
Other Benefits  
Year Ended December 31,2014
 2013
 2012
 2014
 2013
 2012
2015
 2014
 2013
 2015
 2014
 2013
Service cost$261
 $280
 $291
 $26
 $36
 $34
$265
 $261
 $280
 $27
 $26
 $36
Interest cost406
 378
 388
 43
 42
 43
379
 406
 378
 37
 43
 42
Expected return on plan assets1
(713) (659) (573) (11) (9) (8)(705) (713) (659) (11) (11) (9)
Amortization of prior service cost (credit)(2) (2) (2) (17) (10) (52)(2) (2) (2) (19) (17) (10)
Amortization of actuarial loss73
 197
 137
 2
 13
 6
Amortization of actuarial loss2
199
 73
 197
 10
 2
 13
Net periodic benefit cost$25
 $194
 $241
 $43
 $72
 $23
$136
 $25
 $194
 $44
 $43
 $72
Settlement charge4
 1
 3
 
 
 
Curtailment charge
 
 6
 
 
 
Special termination benefits2
5
 2
 1
 
 
 
Settlement charge3
149
 4
 1
 
 
 
Special termination benefits3
20
 5
 2
 2
 
 
Total cost recognized in statements of income$34
 $197
 $251
 $43
 $72
 $23
$305
 $34
 $197
 $46
 $43
 $72
1 
The Company has elected to use the actual fair value of plan assets as the market-related value of assets in the determination of the expected return on plan assets.
2 
Actuarial gains and losses are amortized using a corridor approach. The gain/loss corridor is equal to 10 percent of the greater of the pension benefit obligation and the market-related value of assets. Gains and losses in excess of the corridor are generally amortized over the average future working lifetime of the pension plan participants.
3
The settlement charge and special termination benefits were primarily related to the Company's productivity, restructuring and integration initiatives. Refer to Note 18 for additional information related to our productivity, restructuring and integration initiatives.18.

118



The following table sets forth the changes in AOCI for our benefit plans (in millions, pretax):
Pension Benefits  
 
Other Benefits  
Pension Benefits  
 
Other Benefits  
2014
 2013
 2014
 2013
Beginning balance in AOCI$(1,537) $(3,032) $13
 $(186)
Year Ended December 31,2015
 2014
 2015
 2014
Balance in AOCI at beginning of year$(3,069) $(1,537) $(67) $13
Recognized prior service cost (credit)(2) (2) (17) (10)(2) (2) (19) (17)
Recognized net actuarial loss (gain)77
 198
 2
 13
348
 77
 10
 2
Prior service credit (cost) arising in current year
 1
 31
 73
(6) 
 10
 31
Net actuarial (loss) gain arising in current year(1,658) 1,283
 (97) 122
(270) (1,658) 40
 (97)
Foreign currency translation gain (loss)51
 15
 1
 1
92
 51
 
 1
Ending balance in AOCI$(3,069) $(1,537) $(67) $13
Balance in AOCI at end of year$(2,907) $(3,069) $(26) $(67)
The following table sets forth amounts in AOCI for our benefit plans (in millions, pretax):
Pension Benefits  
 
Other Benefits  
Pension Benefits  
 
Other Benefits  
December 31,2014
 2013
 2014
 2013
2015
 2014
 2015
 2014
Prior service credit (cost)$10
 $12
 $100
 $86
$3
 $10
 $93
 $100
Net actuarial loss(3,079) (1,549) (167) (73)(2,910) (3,079) (119) (167)
Ending balance in AOCI$(3,069) $(1,537) $(67) $13
Balance in AOCI at end of year$(2,907) $(3,069) $(26) $(67)
Amounts in AOCI expected to be recognized as components of net periodic pension cost in 20152016 are as follows (in millions, pretax):
Pension Benefits Other BenefitsPension Benefits Other Benefits
Amortization of prior service cost (credit)$(2) $(19)$(2) $(19)
Amortization of actuarial loss203
 10
181
 7
$201
 $(9)
Total$179
 $(12)

113



Assumptions
Certain weighted-average assumptions used in computing the benefit obligations are as follows:
Pension Benefits  
 
Other Benefits  
Pension Benefits  
 
Other Benefits  
December 31,2014
 2013
 2014
 2013
2015
 2014
 2015
 2014
Discount rate3.75% 4.75% 3.75% 4.75%4.25% 3.75% 4.25% 3.75%
Rate of increase in compensation levels3.50% 3.50% N/A
 N/A
3.50% 3.50% N/A
 N/A


119



Certain weighted-average assumptions used in computing net periodic benefit cost are as follows:
Pension Benefits  
 
Other Benefits  
Pension Benefits  
 
Other Benefits  
Year Ended December 31,2014
 2013
 2012
 2014
 2013
 2012
2015
 2014
 2013
 2015
 2014
 2013
Discount rate4.75% 4.00% 4.75% 4.75% 4.00% 4.75%3.75% 4.75% 4.00% 3.75% 4.75% 4.00%
Rate of increase in compensation levels3.50% 3.50% 3.25% N/A
 N/A
 N/A
3.50% 3.50% 3.50% N/A
 N/A
 N/A
Expected long-term rate of return on plan assets8.25% 8.25% 8.25% 4.75% 4.75% 4.75%8.25% 8.25% 8.25% 4.75% 4.75% 4.75%
The expected long-term rate of return assumption for U.S. pension plan assets is based upon the target asset allocation and is determined using forward-looking assumptions in the context of historical returns and volatilities for each asset class, as well as correlations among asset classes. We evaluate the rate of return assumption on an annual basis. The expected long-term rate of return assumption used in computing 20142015 net periodic pension cost for the U.S. plans was 8.5 percent. As of December 31, 2014,2015, the 5-year, 10-year and 15-year annualized return on plan assets for the primary U.S. plan was 10.46.7 percent, 6.35.4 percent and 5.55.7 percent, respectively. The annualized return since inception was 10.910.6 percent.
The assumed health care cost trend rates are as follows:
December 31,2014
 2013
2015
 2014
Health care cost trend rate assumed for next year7.50% 8.00%7.00% 7.50%
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)5.00% 5.00%5.00% 5.00%
Year that the rate reaches the ultimate trend rate2020
 2020
2021
 2020
The Company's U.S. postretirement benefit plans are primarily defined dollar benefit plans that limit the effects of medical inflation because the plans have established dollar limits for determining our contributions. As a result, the effect of a 1 percentage point change in the assumed health care cost trend rate would not be significant to the Company.
The discount rate assumptions used to account for pension and other postretirement benefit plans reflect the rates at which the benefit obligations could be effectively settled. Rates for each of our U.S. and certain non-U.S. plans at December 31, 2014,2015, were determined using a cash flow matching technique whereby the rates of a yield curve, developed from high-quality debt securities, were applied to the benefit obligations to determine the appropriate discount rate. For ourother non-U.S. plans, we base the discount rate on comparable indices within each of the countries. The rate of compensation increase assumption is determined by the Company based upon annual reviews. We review external data and our own historical trends for health care costs to determine the health care cost trend rate assumptions.
Effective January 1, 2016, for benefit plans using the yield curve approach, the Company changed the method used to calculate the service cost and interest cost components of net periodic benefit costs for pension and other postretirement benefit plans and will measure these costs by applying the specific spot rates along the yield curve to the plans' projected cash flows. The Company believes the new approach provides a more precise measurement of service and interest costs by improving the correlation between projected cash flows and the corresponding spot yield curve rates. The change does not affect the measurement of the Company's pension and other postretirement benefit obligations for those plans and is accounted for as a change in accounting estimate, which is applied prospectively.
Cash Flows
Our estimated future benefit payments for funded and unfunded plans are as follows (in millions):
Year Ended December 31,2015
 2016
 2017
 2018
 2019
 2020-2024
2016
 2017
 2018
 2019
 2020
 2021–2025
Pension benefit payments$494
 $518
 $551
 $560
 $584
 $3,137
$521
 $504
 $533
 $551
 $570
 $3,065
Other benefit payments1
61
 65
 67
 67
 68
 343
61
 63
 64
 65
 67
 332
Total estimated benefit payments$555
 $583
 $618
 $627
 $652
 $3,480
$582
 $567
 $597
 $616
 $637
 $3,397
1 
The expected benefit payments for our other postretirement benefit plans are net of estimated federal subsidies expected to be received under the Medicare Prescription Drug, Improvement and Modernization Act of 2003. Federal subsidies are estimated to be approximately $5 million for the period 2015–2019, and $4 million for the period 2020–2024.2016–2020, and $3 million for the period 2021–2025.

114



The Company anticipates making pension contributions in 20152016 of approximately $90$512 million, allthe majority of which will be allocated to our internationalU.S. plans. The majority of these contributions are discretionary.

120



Defined Contribution Plans
Our Company sponsors qualified defined contribution plans covering substantially all U.S. employees. Under the largest U.S. defined contribution plan, we match participants' contributions up to a maximum of 3.5 percent of compensation, subject to certain limitations. Company costs related to the U.S. plans were $9294 million, $9792 million and $9397 million in 20142015, 20132014 and 20122013, respectively. We also sponsor defined contribution plans in certain locations outside the United States. Company costs associated with those plans were $3635 million, $3236 million and $2932 million in 20142015, 20132014 and 20122013, respectively.
Multi-Employer Plans
As a result of our acquisition of Old CCE's former North America business during the fourth quarter of 2010, the Company now participates in various multi-employer pension plans in the United States. Multi-employer pension plans are designed to cover employees from multiple employers and are typically established under collective bargaining agreements. These plans allow multiple employers to pool their pension resources and realize efficiencies associated with the daily administration of the plan.
Multi-employer plans are generally governed by a board of trustees composed of management and labor representatives and are funded through employer contributions.
The Company's expense for U.S. multi-employer pension plans totaled $40 million, $38 million and $37 million in 2015, 2014 and $31 million in 2014, 2013, and 2012, respectively. The plans we currently participate in have contractual arrangements that extend into 2019.2020. If, in the future, we choose to withdraw from any of the multi-employer pension plans in which we currently participate, we would need to record the appropriate withdrawal liabilities at that time.
NOTE 14: INCOME TAXES
Income before income taxes consisted of the following (in millions):
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
United States$1,567
 $2,451
 $3,526
$1,801
 $1,567
 $2,451
International7,758
 9,026
 8,283
7,804
 7,758
 9,026
Total$9,325
 $11,477
 $11,809
$9,605
 $9,325
 $11,477
Income tax expense consisted of the following for the years ended December 31, 2015, 2014 2013 and 20122013 (in millions):
United States
 State and Local
 International
 Total
United States
 State and Local
 International
 Total
2015       
Current$711
 $69
 $1,386
 $2,166
Deferred120
 45
 (92) 73
2014              
Current$867
 $81
 $1,293
 $2,241
$867
 $81
 $1,293
 $2,241
Deferred(97) (21) 78
 (40)(97) (21) 78
 (40)
2013              
Current$713
 $102
 $1,388
 $2,203
$713
 $102
 $1,388
 $2,203
Deferred305
 38
 305
 648
305
 38
 305
 648
2012       
Current$602
 $74
 $1,415
 $2,091
Deferred936
 33
 (337) 632
We made income tax payments of $2,357 million, $1,926 million and $2,162 million in 2015, 2014 and $981 million in 2014, 2013, and 2012, respectively.

115121



A reconciliation of the statutory U.S. federal tax rate and our effective tax rate is as follows:
Year Ended December 31,2014
 2013
 2012
 2015
 2014
 2013
 
Statutory U.S. federal tax rate35.0 % 35.0 % 35.0 % 35.0 % 35.0 % 35.0 % 
State and local income taxes — net of federal benefit1.0
 1.0
 1.1
 1.2
 1.0
 1.0
 
Earnings in jurisdictions taxed at rates different from the statutory U.S. federal rate(11.5)
1,2 
(10.3)
5,6,7 
(9.5)
10,11 
(12.7)
1 
(11.5)
6,7 
(10.3)
10,11,12 
Reversal of valuation allowances
 
 (2.4)
12 
Equity income or loss(2.2) (1.4)
8 
(2.0) (1.7)
2 
(2.2) (1.4)
13 
Other operating charges2.9
3,4 
1.2
9 
0.4
13 
1.2
3,4 
2.9
8,9 
1.2
14 
Other — net(1.6) (0.7) 0.5
 0.3
5 
(1.6) (0.7) 
Effective tax rate23.6 % 24.8 % 23.1 % 23.3 % 23.6 % 24.8 % 
1 
Includes a pretax charge of $27 million (or a 0.1 percent impact on our effective tax rate) due to the remeasurement of the net monetary assets of our local Venezuelan subsidiary into U.S. dollars using the SIMADI exchange rate. Refer to Note 1 and Note 17.
2
Includes a tax benefit of $5 million on a pretax charge of $87 million (or a 0.3 percent impact on our effective tax rate) related to our proportionate share of unusual or infrequent items recorded by our equity method investees. Refer to Note 17.
3
Includes a tax benefit of $45 million on a pretax charge of $225 million (or a 0.3 percent impact on our effective tax rate) primarily due to an impairment of a Venezuelan trademark, a write-down of receivables from our bottling partner in Venezuela, a cash contribution to The Coca-Cola Foundation and charges associated with ongoing tax litigation. Refer to Note 1 and Note 17.
4
Includes a tax benefit of $259 million on pretax charges of $983 million (or a 0.9 percent impact on our effective tax rate) primarily related to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 18.
5
Includes tax expense of $150 million on pretax income of $77 million (or a 1.3 percent impact on our effective rate) primarily due to the gain related to the Monster Transaction, offset by charges related to the refranchising of certain territories in North America and charges associated with the early extinguishment of long-term debt. Refer to Note 2 and Note 17.
6
Includes tax expense of $6 million tax expense on a pretax net charge of $372 million (or a 1.5 percent impact on our effective tax rate) due to the remeasurement of the net monetary assets of our local Venezuelan subsidiary into U.S. dollars using the SICAD 2 exchange rate. Refer to Note 1.
27 
Includes a tax expense of $18 million (or a 0.2 percent impact on our effective tax rate) related to amounts required to be recorded for changes to our uncertain tax positions, including interest and penalties, in various international jurisdictions.
38 
Includes a tax expense of $55 million on a pretax charge of $352 million (or a 1.9 percent impact on our effective tax rate) primarily due to an impairment of a Venezuelan trademark, a write-down the Company recorded on the concentrate sales receivables from our bottling partner in Venezuela, a charge associated with certain of the Company's fixed assets, and as a result of the restructuring and transition of the Company's Russian juice operations to an existing joint venture with an unconsolidated bottling partner. Refer to Note 1 and Note 17.
49 
Includes a tax benefit of $191 million on pretax charges of $809 million (or a 1 percent impact on our effective tax rate) primarily related to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 18.
510 
Includes a tax benefit of $26 million (or a 0.2 percent impact on our effective tax rate) related to amounts required to be recorded for changes to our uncertain tax positions, including interest and penalties, in various international jurisdictions.
611 
Includes a tax expense of $279 million on pretax net gains of $501 million (or a 0.9 percent impact on our effective tax rate) related to the deconsolidation of our Brazilian bottling operations upon their combination with an independent bottler and a loss due to the merger of four of the Company's Japanese bottling partners. Refer to Note 2 and Note 17.
712 
Includes a tax expense of $3 million (or a 0.5 percent impact on our effective tax rate) related to a charge of $149 million due to the devaluation of the Venezuelan bolivar. Refer to Note 19.
813 
Includes ana tax benefit of $8 million tax benefit on a pretax charge of $159 million (or a 0.4 percent impact on our effective tax rate) related to our proportionate share of unusual or infrequent items recorded by our equity method investees. Refer to Note 17.
914 
Includes a tax benefit of $175 million on pretax charges of $877 million (or a 1.2 percent impact on our effective tax rate) primarily related to impairment charges recorded on certain of the Company's intangible assets and charges related to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 17 and Note 18.
10
Includes a tax expense of $133 million (or a 1.1 percent impact on our effective tax rate) related to amounts required to be recorded for changes to our uncertain tax positions, including interest and penalties, in various international jurisdictions.
11
Includes a tax expense of $57 million on pretax net gains of $76 million (or a 0.3 percent impact on our effective tax rate) related to the following: a gain recognized as a result of the merger of Embotelladora Andina S.A. ("Andina") and Embotelladoras Coca-Cola Polar S.A. ("Polar"); a gain recognized as a result of Coca-Cola FEMSA, an equity method investee, issuing additional shares of its own stock at a per share amount greater than the carrying value of the Company's per share investment; the loss recognized on the then pending sale of a majority ownership interest in our consolidated Philippine bottling operations to Coca-Cola FEMSA; and the expense recorded for the premium the Company paid over the publicly traded market price to acquire an ownership interest in Mikuni. Refer to Note 17.
12
Relates to a net tax benefit of $283 million associated with the reversal of valuation allowances in certain of the Company's foreign jurisdictions.
13
Includes a tax benefit of $95 million on pretax charges of $416 million (or a 0.4 percent impact on our effective tax rate) primarily related to the Company's productivity and reinvestment program as well as other restructuring initiatives; the refinement of previously established accruals related to the Company's 2008–2011 productivity initiatives; and the refinement of previously established accruals related to the Company's integration of CCE's former North America business. Refer to Note 18.

116122



Our effective tax rate reflects the tax benefits of having significant operations outside the United States, which are generally taxed at rates lower than the U.S. statutory rate of 3535.0 percent. As a result of employment actions and capital investments made by the Company, certain tax jurisdictions provide income tax incentive grants, including Brazil, Costa Rica, Singapore and Swaziland. The terms of these grants expire from 2016 to 2023. We anticipate that we will be able to extend or renew the grants in these locations. Tax incentive grants favorably impacted our income tax expense by $265223 million, $279265 million and $280279 million for the years ended December 31, 20142015, 20132014 and 20122013, respectively. In addition, our effective tax rate reflects the benefits of having significant earnings generated in investments accounted for under the equity method of accounting, which are generally taxed at rates lower than the U.S. statutory rate.
The Company or one of its subsidiaries files income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. U.S. tax authorities have completed their federal income tax examinations for all years prior to 20052007. With respect to state and local jurisdictions and countries outside the United States, with limited exceptions, the Company and its subsidiaries are no longer subject to income tax audits for years before 20022006. For U.S. federal and state tax purposes, the net operating losses and tax credit carryovers acquired in connection with our acquisition of Old CCE's former North America business that were generated between the years of 1990 through 2010 are subject to adjustments until the year in which they are actually utilized is no longer subject to examination. Although the outcome of tax audits is always uncertain, the Company believes that adequate amounts of tax, including interest and penalties, have been provided for any adjustments that are expected to result from those years.
On September 17, 2015, the Company received a Notice from the IRS for the tax years 2007 through 2009, after a five-year audit. Refer to Note 11.
As of December 31, 2014,2015, the gross amount of unrecognized tax benefits was $211$168 million. If the Company were to prevail on all uncertain tax positions, the net effect would be a benefit to the Company's effective tax rate of $173$148 million, exclusive of any benefits related to interest and penalties. The remaining $38$20 million, which was recorded as a deferred tax asset, primarily represents tax benefits that would be received in different tax jurisdictions in the event the Company did not prevail on all uncertain tax positions.
A reconciliation of the changes in the gross balanceamount of unrecognized tax benefit amountsbenefits is as follows (in millions):
Year Ended December 31,2014
 2013
 2012
Beginning balance of unrecognized tax benefits$230
 $302
 $320
Increases related to prior period tax positions13
 1
 69
Decreases related to prior period tax positions(2) (7) (15)
Increases related to current period tax positions11
 8
 23
Decreases related to settlements with taxing authorities(5) (4) (45)
Reductions as a result of a lapse of the applicable statute of limitations(32) (59) (36)
Increases (decreases) from effects of foreign currency exchange rates(4) (11) (14)
Ending balance of unrecognized tax benefits$211
 $230
 $302
Year Ended December 31,2015
 2014
 2013
Beginning balance of unrecognized tax benefits$211
 $230
 $302
Increase related to prior period tax positions4
 13
 1
Decrease related to prior period tax positions(9) (2) (7)
Increase related to current period tax positions5
 11
 8
Decrease related to settlements with taxing authorities(5) (5) (4)
Decrease due to lapse of the applicable statute of limitations(23) (32) (59)
Increase (decrease) due to effect of foreign currency exchange rate changes(15) (4) (11)
Ending balance of unrecognized tax benefits$168
 $211
 $230
The Company recognizes accrued interest and penalties related to unrecognized tax benefits in income tax expense. The Company had $111 million, $113 million $105 million and $113$105 million in interest and penalties related to unrecognized tax benefits accrued as of December 31, 2015, 2014 2013 and 2012,2013, respectively. Of these amounts, $8 million of expense and $8 million of benefit and $33 million of expense were recognized through income tax expense in 2014 2013 and 2012,2013, respectively. For the year ended December 31, 2015, an insignificant amount of interest and penalties were recognized through income tax expense. If the Company were to prevail on all uncertain tax positions, the reversal of this accrual would also be a benefit to the Company's effective tax rate.
It is expected that the amount of unrecognized tax benefits will change in the next 12 months; however, we do not expect the change to have a significant impact on our consolidated statements of income or consolidated balance sheets. These changes may be the result of settlements of ongoing audits, statute of limitations expiring or final settlements in transfer pricing matters that are the subject of litigation. At this time, an estimate of the range of the reasonably possible outcomes cannot be made.

123



As of December 31, 2014,2015, undistributed earnings of the Company's foreign subsidiaries amounted to $33.3$31.9 billion. Those earnings are considered to be indefinitely reinvested and, accordingly, no U.S. federal and state income taxes have been provided thereon. Upon distribution of those earnings in the form of dividends or otherwise, the Company would be subject to both U.S. income taxes (subject to an adjustment for foreign tax credits) and withholding taxes payable to the various foreign countries. Determination of the amount of unrecognized deferred U.S. income tax liability is not practicable because of the complexities associated with its hypothetical calculation; however, unrecognized foreign tax credits would be available to reduce a portion of the U.S. tax liability.

117



The tax effects of temporary differences and carryforwards that give rise to deferred tax assets and liabilities consist of the following (in millions):
December 31,2014
 2013
 2015
 2014
Deferred tax assets:       
Property, plant and equipment$96
 $102
 $192
 $96
Trademarks and other intangible assets68
 63
 68
 68
Equity method investments (including foreign currency translation adjustment)462
 243
 694
 462
Derivative financial instruments134
 50
 161
 134
Other liabilities1,082
 1,102
 1,056
 1,082
Benefit plans1,673
 1,237
 1,541
 1,673
Net operating/capital loss carryforwards729
 790
 413
 729
Other196
 225
 175
 196
Gross deferred tax assets$4,440
 $3,812
 $4,300
 $4,440
Valuation allowances(649) (586) (477) (649)
Total deferred tax assets1,2
$3,791
 $3,226
 $3,823
 $3,791
Deferred tax liabilities:       
Property, plant and equipment$(2,342) $(2,417) $(1,887) $(2,342)
Trademarks and other intangible assets(4,020) (4,192) (3,422) (4,020)
Equity method investments (including foreign currency translation adjustment)(1,038) (1,070) (1,441) (1,038)
Derivative financial instruments(457) (147) (687) (457)
Other liabilities(110) (69) (216) (110)
Benefit plans(487) (473) (367) (487)
Other(944) (810) (726) (944)
Total deferred tax liabilities3
$(9,398) $(9,178) $(8,746) $(9,398)
Net deferred tax liabilities$(5,607) $(5,952) $(4,923) $(5,607)
1 
Noncurrent deferred tax assets of $319$360 million and $328$319 million were included in the line item other assets in our consolidated balance sheets as of December 31, 20142015 and 2013,2014, respectively.
2 
Current deferred tax assets of $160$151 million and $211$160 million were included in the line item prepaid expenses and other assets in our consolidated balance sheets as of December 31, 20142015 and 2013,2014, respectively.
3 
Current deferred tax liabilities of $450$743 million and $339$450 million were included in the line item accounts payable and accrued expenses in our consolidated balance sheets as of December 31, 20142015 and 2013,2014, respectively.
As of December 31, 20142015 and 2013,2014, we had $643$62 million and $198 million, respectively, of net deferred tax assets and $643 million of net deferred tax liabilities, respectively, located in countries outside the United States.
As of December 31, 2014,2015, we had $6,408$4,419 million of loss carryforwards available to reduce future taxable income. Loss carryforwards of $497$356 million must be utilized within the next five years, and the remainder can be utilized over a period greater than five years.

124



An analysis of our deferred tax asset valuation allowances is as follows (in millions):
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
Balance at beginning of year$586
 $487
 $859
$649
 $586
 $487
Additions104
 169
 126
42
 104
 169
Decrease due to transfer to assets held for sale
 
 (146)(163) 
 
Deductions(41) (70) (352)(51) (41) (70)
Balance at end of year$649
 $586
 $487
$477
 $649
 $586
The Company's deferred tax asset valuation allowances are primarily the result of uncertainties regarding the future realization of recorded tax benefits on tax loss carryforwards from operations in various jurisdictions. These valuation allowances were primarily related to deferred tax assets generated from net operating losses. Current evidence does not suggest we will realize sufficient taxable income of the appropriate character within the carryforward period to allow us to realize these deferred tax benefits. If we were to identify and implement tax planning strategies to recover these deferred tax assets or generate sufficient income of the appropriate character in these jurisdictions in the future, it could lead to the reversal of these valuation

118



allowances and a reduction of income tax expense. The Company believes that it will generate sufficient future taxable income to realize the tax benefits related to the remaining net deferred tax assets in our consolidated balance sheets.
In 2015, the Company recognized a net decrease of $172 million in its valuation allowances. As a result of our German bottling operations meeting the criteria to be classified as held for sale, the Company was required to present the related assets and liabilities as separate line items in our consolidated balance sheets. In addition, the changes in net operating losses during the normal course of business and changes in deferred tax assets and related valuation allowances on certain equity investments also contributed to a decrease in the valuation allowances. These decreases were partially offset by an increase in the valuation allowances primarily due to the impact of currency devaluations in Venezuela on certain receivables.
In 2014, the Company recognized a net increase of $63 million in its valuation allowances. This increase was primarily due to the increase in net operating losses during the normal course of business operations and due to the remeasurement of the net monetary assets of our local Venezuelan subsidiary into U.S. dollars using the SICAD 2 exchange rate. The Company recognized a reduction in the valuation allowances primarily due to changes in deferred tax assets and related valuation allowances on certain equity investments and decreases in net operating losses during the normal course of business operations.
In 2013, the Company recognized a net increase of $99 million in its valuation allowances. This increase was primarily due to the addition of a deferred tax asset and related valuation allowance on certain equity method investments and increases in net operating losses during the normal course of business operations. In addition, the Company recognized a reduction in the valuation allowances primarily due to the reversal of a deferred tax asset and related valuation allowance on certain equity method investments.
In 2012, the Company recognized a net decrease of $372 million in its valuation allowances. This decrease was primarily related to the reversal of valuation allowances in several foreign jurisdictions. As a result of considering recent significant positive evidence, including, among other items, a consistent pattern of earnings in the past three years, as well as business plans showing continued profitability, it was determined that a valuation allowance was no longer required for certain deferred tax assets primarily recorded on net operating losses in foreign jurisdictions. This decrease was also partially due to a transfer of a valuation allowance into assets held for sale as required by accounting principles generally accepted in the United States upon execution of the share purchase agreement for the sale of a majority interest in our consolidated Philippine bottling operations. Refer to Note 1 for additional information on the Company's accounting policy related to assets and liabilities held for sale. Refer to Note 2 for additional information on the Company's Philippine bottling operations. In addition, the Company recognized an increase in its valuation allowances primarily due to the addition of a deferred tax asset and related valuation allowance on certain equity method investments and increases in net operating losses during the normal course of business operations.
NOTE 15: OTHER COMPREHENSIVE INCOME
AOCI attributable to shareowners of The Coca-Cola Company is separately presented on our consolidated balance sheets as a component of The Coca-Cola Company's shareowners' equity, which also includes our proportionate share of equity method investees' AOCI. Other comprehensive income (loss) ("OCI") attributable to noncontrolling interests is allocated to, and included in, our balance sheets as part of the line item equity attributable to noncontrolling interests.
AOCI attributable to shareowners of The Coca-Cola Company consisted of the following (in millions):
December 31,2014
 2013
2015
 2014
Foreign currency translation adjustment$(5,226) $(2,849)$(9,167) $(5,226)
Accumulated derivative net gains (losses)554
 197
696
 554
Unrealized net gains (losses) on available-for-sale securities972
 258
288
 972
Adjustments to pension and other benefit liabilities(2,077) (1,038)(1,991) (2,077)
Accumulated other comprehensive income (loss)$(5,777) $(3,432)$(10,174) $(5,777)

119125



The following table summarizes the allocation of total comprehensive income between shareowners of The Coca-Cola Company and noncontrolling interests (in millions):
Year Ended December 31, 2014Year Ended December 31, 2015
Shareowners of
The Coca-Cola Company

Noncontrolling
Interests

Total
Shareowners of
The Coca-Cola Company

Noncontrolling
Interests

Total
Consolidated net income$7,098
$26
$7,124
$7,351
$15
$7,366
Other comprehensive income:  
Net foreign currency translation adjustment(2,377)(5)(2,382)(3,941)(18)(3,959)
Net gain (loss) on derivatives1
357

357
142

142
Net unrealized gain (loss) on available-for-sale securities2
714

714
(684)
(684)
Net change in pension and other benefit liabilities3
(1,039)
(1,039)86

86
Total comprehensive income$4,753
$21
$4,774
$2,954
$(3)$2,951
1
Refer to Note 5 for additional information related to the net gain or loss on derivative instruments designated and qualifying as cash flow hedging instruments.
2
Refer to Note 3 for information related to the net unrealized gain or loss on available-for-sale securities.
3 
Refer to Note 13 for additional information related to the Company's pension and other postretirement benefit liabilities.
OCI attributable to shareowners of The Coca-Cola Company, including our proportionate share of equity method investees' OCI, for the years ended December 31, 2015, 2014 2013 and 2012,2013, is as follows (in millions):
Before-Tax Amount
 Income Tax
 After-Tax Amount
Before-Tax Amount
 Income Tax
 After-Tax Amount
2014     
2015     
Foreign currency translation adjustments:          
Translation adjustment arising in the period$(2,560) $183
 $(2,377)
Translation adjustment arising during the year$(4,626) $243
 $(4,383)
Reclassification adjustments recognized in net income63
 (14) 49
Unrealized gains (losses) on net investment hedges arising during the year637
 (244) 393
Net foreign currency translation adjustment(2,560) 183
 (2,377)(3,926) (15) (3,941)
Derivatives:          
Unrealized gains (losses) arising during the year620
 (231) 389
853
 (314) 539
Reclassification adjustments recognized in net income(50) 18
 (32)(638) 241
 (397)
Net gain (loss) on derivatives1
570
 (213) 357
215
 (73) 142
Available-for-sale securities:          
Unrealized gains (losses) arising during the year1,139
 (412) 727
(973) 328
 (645)
Reclassification adjustments recognized in net income(17) 4
 (13)(61) 22
 (39)
Net change in unrealized gain (loss) on available-for-sale securities2
1,122
 (408) 714
(1,034) 350
 (684)
Pension and other benefit liabilities:          
Net pension and other benefits arising during the year(1,666) 588
 (1,078)(169) 43
 (126)
Reclassification adjustments recognized in net income60
 (21) 39
337
 (125) 212
Net change in pension and other benefit liabilities3
(1,606) 567
 (1,039)168
 (82) 86
Other comprehensive income (loss) attributable to The Coca-Cola Company$(2,474) $129
 $(2,345)$(4,577) $180
 $(4,397)
1 
Refer to Note 5 for additional information related to the net gain or loss on derivative instruments designated and qualifying as cash flow hedging instruments.
2 
Includes reclassification adjustments related to divestitures of certain available-for-sale securities. Refer to Note 3 for additional information related to these divestitures.
3 
Refer to Note 13 for additional information related to the Company's pension and other postretirement benefit liabilities.

120126



Before-Tax Amount
 Income Tax
 After-Tax Amount
Before-Tax Amount
 Income Tax
 After-Tax Amount
2013     
2014     
Foreign currency translation adjustments:          
Translation adjustment arising in the period$(1,046) $56
 $(990)
Reclassification adjustments recognized in net income(194) 
 (194)
Translation adjustment arising during the year$(2,560) $183
 $(2,377)
Net foreign currency translation adjustment(1,240) 56
 (1,184)(2,560) 183
 (2,377)
Derivatives:          
Unrealized gains (losses) arising during the year425
 (173) 252
620
 (231) 389
Reclassification adjustments recognized in net income(167) 66
 (101)(50) 18
 (32)
Net gain (loss) on derivatives1
258
 (107) 151
570
 (213) 357
Available-for-sale securities:          
Unrealized gains (losses) arising during the year(134) 42
 (92)1,139
 (412) 727
Reclassification adjustments recognized in net income12
 
 12
(17) 4
 (13)
Net change in unrealized gain (loss) on available-for-sale securities2
(122) 42
 (80)1,122
 (408) 714
Pension and other benefit liabilities:          
Net pension and other benefits arising during the year1,490
 (550) 940
(1,666) 588
 (1,078)
Reclassification adjustments recognized in net income198
 (72) 126
60
 (21) 39
Net change in pension and other benefit liabilities3
1,688
 (622) 1,066
(1,606) 567
 (1,039)
Other comprehensive income (loss) attributable to The Coca-Cola Company$584
 $(631) $(47)$(2,474) $129
 $(2,345)
1 
Refer to Note 5 for additional information related to the net gain or loss on derivative instruments designated and qualifying as cash flow hedging instruments.
2 
Includes reclassification adjustments related to divestitures of certain available-for-sale securities. Refer to Note 3 for additional information related to these divestitures.
3 
Refer to Note 13 for additional information related to the Company's pension and other postretirement benefit liabilities.
Before-Tax Amount
 Income Tax
 After-Tax Amount
Before-Tax Amount
 Income Tax
 After-Tax Amount
2012     
2013     
Foreign currency translation adjustments:     
Translation adjustment arising during the year$(1,046) $56
 $(990)
Reclassification adjustments recognized in net income(194) 
 (194)
Net foreign currency translation adjustment$(219) $(1) $(220)(1,240) 56
 (1,184)
Derivatives:          
Unrealized gains (losses) arising during the year77
 (29) 48
425
 (173) 252
Reclassification adjustments recognized in net income82
 (31) 51
(167) 66
 (101)
Net gain (loss) on derivatives1
159
 (60) 99
258
 (107) 151
Available-for-sale securities:          
Unrealized gains (losses) arising during the year248
 (64) 184
(134) 42
 (92)
Reclassification adjustments recognized in net income(6) 
 (6)12
 
 12
Net change in unrealized gain (loss) on available-for-sale securities2
242
 (64) 178
(122) 42
 (80)
Pension and other benefit liabilities:          
Net pension and other benefits arising during the year(1,132) 405
 (727)1,490
 (550) 940
Reclassification adjustments recognized in net income92
 (33) 59
198
 (72) 126
Net change in pension and other benefit liabilities3
(1,040) 372
 (668)1,688
 (622) 1,066
Other comprehensive income (loss) attributable to The Coca-Cola Company$(858) $247
 $(611)$584
 $(631) $(47)
1 
Refer to Note 5 for additional information related to the net gain or loss on derivative instruments designated and qualifying as cash flow hedging instruments.
2 
Includes reclassification adjustments related to divestitures of certain available-for-sale securities. Refer to Note 3 for additional information related to these divestitures.
3 
Refer to Note 13 for additional information related to the Company's pension and other postretirement benefit liabilities.

121127



The following table presents the amounts and line items in our consolidated statements of income where adjustments reclassified from AOCI into income were recorded during the year ended December 31, 20142015 (in millions):
Description of AOCI ComponentFinancial Statement Line Item
Amount Reclassified from
AOCI into Income

 Financial Statement Line Item
Amount Reclassified from
AOCI into Income

Foreign currency translation adjustments:  
Divestitures, deconsolidations and otherOther income (loss) — net$63
Income before income taxes$63
Income taxes(14)
Consolidated net income$49
Derivatives:     
Foreign currency contractsNet operating revenues$(121) Net operating revenues$(630)
Foreign currency and commodity contractsCost of goods sold(37) Cost of goods sold(59)
Foreign currency contractsOther income (loss) — net108
 Other income (loss) — net40
Foreign currency and interest rate contractsInterest expense11
Income before income taxes$(50) Income before income taxes$(638)
Income taxes18
 Income taxes241
Consolidated net income$(32) Consolidated net income$(397)
Available-for-sale securities:     
Sale of securitiesOther income (loss) — net$(17) Other income (loss) — net$(61)
Income before income taxes$(17) Income before income taxes$(61)
Income taxes4
 Income taxes22
Consolidated net income$(13) Consolidated net income$(39)
Pension and other benefit liabilities:     
Amortization of net actuarial loss*$79
 
Amortization of prior service cost (credit)*(19) 
Recognized net actuarial loss (gain)*$358
Recognized prior service cost (credit)*(21)
Income before income taxes$60
 Income before income taxes$337
Income taxes(21) Income taxes(125)
Consolidated net income$39
 Consolidated net income$212
*This component of AOCI is included in the Company's computation of net periodic benefit cost and is not reclassified out of AOCI into a single line item in our consolidated statements of income in its entirety. Refer to Note 13 for additional information.
NOTE 16: FAIR VALUE MEASUREMENTS
Accounting principles generally accepted in the United States define fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. Additionally, the inputs used to measure fair value are prioritized based on a three-level hierarchy. This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:
Level 1 — Quoted prices in active markets for identical assets or liabilities.
Level 2 — Observable inputs other than quoted prices included in Level 1. We value assets and liabilities included in this level using dealer and broker quotations, certain pricing models, bid prices, quoted prices for similar assets and liabilities in active markets, or other inputs that are observable or can be corroborated by observable market data.
Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

122128



Recurring Fair Value Measurements
In accordance with accounting principles generally accepted in the United States, certain assets and liabilities are required to be recorded at fair value on a recurring basis. For our Company, the only assets and liabilities that are adjusted to fair value on a recurring basis are investments in equity and debt securities classified as trading or available-for-sale and derivative financial instruments. Additionally, the Company adjusts the carrying value of certain long-term debt as a result of the Company's fair value hedging strategy.
Investments in Trading and Available-for-Sale Securities
The fair values of our investments in trading and available-for-sale securities using quoted market prices from daily exchange traded markets are based on the closing price as of the balance sheet date and are classified as Level 1. The fair values of our investments in trading and available-for-sale securities classified as Level 2 are priced using quoted market prices for similar instruments or nonbinding market prices that are corroborated by observable market data. Inputs into these valuation techniques include actual trade data, benchmark yields, broker/dealer quotes and other similar data. These inputs are obtained from quoted market prices, independent pricing vendors or other sources.
Derivative Financial Instruments
The fair values of our futures contracts are primarily determined using quoted contract prices on futures exchange markets. The fair values of these instruments are based on the closing contract price as of the balance sheet date and are classified as Level 1.
The fair values of our derivative instruments other than futures are determined using standard valuation models. The significant inputs used in these models are readily available in public markets, or can be derived from observable market transactions, and therefore have been classified as Level 2. Inputs used in these standard valuation models for derivative instruments other than futures include the applicable exchange rates, forward rates, interest rates, discount rates and commodity prices. The standard valuation model for options also uses implied volatility as an additional input. The discount rates are based on the historical U.S. Deposit or U.S. Treasury rates, and the implied volatility specific to options is based on quoted rates from financial institutions.
Included in the fair value of derivative instruments is an adjustment for nonperformance risk. The adjustment is based on current credit default swap ("CDS") rates applied to each contract, by counterparty. We use our counterparty's CDS rate when we are in an asset position and our own CDS rate when we are in a liability position. The adjustment for nonperformance risk did not have a significant impact on the estimated fair value of our derivative instruments.
The following tables summarize those assets and liabilities measured at fair value on a recurring basis (in millions):
 December 31, 2015 
 Level 1
 Level 2
 Level 3
 
Netting
Adjustment1

 
Fair Value
Measurements

 
Assets:          
Trading securities2
$183
 $135
 $4
 $
 $322
 
Available-for-sale securities2
3,913
 4,574
 119
3 

 8,606
 
     Derivatives4
2
 1,268
 
 (638)
5 
632
7 
Total assets$4,098
 $5,977
 $123
 $(638) $9,560
 
Liabilities:          
    Derivatives4
$24
 $635
 $
 $(488)
6 
$171
7 
Total liabilities$24
 $635
 $
 $(488) $171
 
1
Amounts represent the impact of legally enforceable master netting agreements that allow the Company to settle net positive and negative positions and also cash collateral held or placed with the same counterparties. There are no amounts subject to legally enforceable master netting agreements that management has chosen not to offset or that do not meet the offsetting requirements. Refer to Note 5.
2
Refer to Note 3 for additional information related to the composition of our trading securities and available-for-sale securities.
3
Primarily related to long-term debt securities that mature in 2018.
4
Refer to Note 5 for additional information related to the composition of our derivative portfolio.
5
The Company is obligated to return $184 million in cash collateral it has netted against its derivative position.
6
The Company has the right to reclaim $17 million in cash collateral it has netted against its derivative position.
7
The Company's derivative financial instruments are recorded at fair value in our consolidated balance sheet as follows: $79 million in the line item prepaid expenses and other assets; $553 million in the line item other assets; and $171 million in the line item other liabilities. Refer to Note 5 for additional information related to the composition of our derivative portfolio.

129



 December 31, 2014 
 Level 1
 Level 2
 Level 3
 
Netting
Adjustment1

 
Fair Value
Measurements

 
Assets:          
Trading securities2
$228
 $177
 $4
 $
 $409
 
Available-for-sale securities2
4,116
 3,627
 136
3 

 7,879
 
     Derivatives4
9
 1,721
 
 (437) 1,293
5 
Total assets$4,353
 $5,525
 $140
 $(437) $9,581
 
Liabilities:          
    Derivatives4
$2
 $558
 $
 $(437) $123
5 
Total liabilities$2
 $558
 $
 $(437) $123
 
1 
Amounts represent the impact of legally enforceable master netting agreements that allow the Company to settle net positive and negative positions and also cash collateral held or placed with the same counterparties. There are no amounts subject to legally enforceable master netting agreements that management has chosen not to offset or that do not meet the offsetting requirements. Refer to Note 5.
2 
Refer to Note 3 for additional information related to the composition of our trading securities and available-for-sale securities.
3 
Primarily related to long-term debt securities that mature in 2018.
4 
Refer to Note 5 for additional information related to the composition of our derivative portfolio.
5 
The Company's derivative financial instruments are recorded at fair value in our consolidated balance sheet as follows: $567 million in the line item prepaid expenses and other assets; $726 million in the line item other assets; $14 million in the line item accounts payable and accrued expenses; and $109 million in the line item other liabilities. Refer to Note 5 for additional information related to the composition of our derivative portfolio.

123



 December 31, 2013 
 Level 1
 Level 2
 Level 3
 
Netting
Adjustment1

 
Fair Value
Measurements

 
Assets:          
Trading securities2
$206
 $163
 $3
 $
 $372
 
Available-for-sale securities2
1,453
 3,281
 108
3 

 4,842
 
     Derivatives4
17
 822
 
 (150) 689
5 
Total assets$1,676
 $4,266
 $111
 $(150) $5,903
 
Liabilities:          
    Derivatives4
$10
 $165
 $
 $(151) $24
5 
Total liabilities$10
 $165
 $
 $(151) $24
 
1
Amounts represent the impact of legally enforceable master netting agreements that allow the Company to settle net positive and negative positions and also cash collateral held or placed with the same counterparties. There are no amounts subject to legally enforceable master netting agreements that management has chosen not to offset or that do not meet the offsetting requirements. Refer to Note 5.
2
Refer to Note 3 for additional information related to the composition of our trading securities and available-for-sale securities.
3
Primarily related to long-term debt securities that mature in 2018.
4
Refer to Note 5 for additional information related to the composition of our derivative portfolio.
5
The Company's derivative financial instruments are recorded at fair value in our consolidated balance sheet as follows: $129 million in the line item prepaid expenses and other assets; $560 million in the line item other assets; $12 million in the line item accounts payable and accrued expenses; and $12 million in the line item other liabilities. Refer to Note 5 for additional information related to the composition of our derivative portfolio.
Gross realized and unrealized gains and losses on Level 3 assets and liabilities were not significant for the years ended December 31, 20142015 and 2013.2014.
The Company recognizes transfers between levels within the hierarchy as of the beginning of the reporting period. Gross transfers between levels within the hierarchy were not significant for the years ended December 31, 20142015 and 2013.2014.
Nonrecurring Fair Value Measurements
In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company records assets and liabilities at fair value on a nonrecurring basis as required by accounting principles generally accepted in the United States. Generally, assets are recorded at fair value on a nonrecurring basis as a result of impairment charges.

124130



AssetsThe gains or losses on assets measured at fair value on a nonrecurring basis forare summarized in the years ended December 31, 2014 and 2013, are summarizedtable below (in millions):
Gains (Losses)   Gains (Losses)   
December 31,2014
 2013
 2015
 2014
 
Assets held for sale$(494)
1 
$
 
Assets held for sale1
$(980) $(494) 
Intangible assets(18)
2 
(195)
2 
(473)
2 
(18)
2 
Exchange of investment in equity securities
 (114)
4 
Investment in formerly unconsolidated subsidiary(19)
3 

 
Valuation of shares in equity method investee(32)
3 
139
3 
(6)
4 
(32)
4 
Total$(544) $(170) $(1,478) $(544) 
1 
As of December 31, 2014, theThe Company had entered into agreementsis required to refranchise additional territories in North America. These operations met the criteria to be classified asrecord assets and liabilities that are held for sale in our consolidated balance sheet as of December 31, 2014, and we were required to record their assets and liabilities at the lower of carrying value or fair value less any costs to sell based on the agreed-upon sale price. These charges primarily related to refranchising activities in North America. The Company recognized a noncash loss of $494 million during the year ended December 31, 2014 as a result of writing down the assets to their fair value less costs to sell. The loss wascharges were calculated based on Level 3 inputs. Refer to Note 2.
2 
The Company recognized losses of $473 million and $18 million and $195 million during the years ended December 31, 20142015 and 2013,2014, respectively, due to impairment charges on certain intangible assets. The charges incurred during 2015 included $418 million of impairment charges primarily due to the discontinuation of the energy products in the glacéau portfolio as a result of the Monster Transaction and a $55 million impairment charge on a Venezuelan trademark. The charges were primarily determined by comparing the fair value of the assets to the current carrying value. The fair value of the assets was derived using discounted cash flow analyses based on Level 3 inputs. Refer to Note 1, Note 2 and Note 17.
3 
The Company recognized a loss of $19 million on our previously held investment in a South African bottler, which had been accounted for under the equity method of accounting prior to our acquisition of the bottler in February 2015. U.S. GAAP requires the acquirer to remeasure its previously held noncontrolling equity interest in the acquired entity to fair value as of the acquisition date and recognize any gains or losses in earnings. The Company remeasured our equity interest in the South African bottler based on Level 3 inputs. Refer to Note 2.
4
In 2014, the Company recognized aan estimated loss of $32 millionas a result of the owners of the majority interest in certaina Brazilian bottling operationsentity exercising their option to acquire from us a 10 percent interest in the entity's outstanding shares. The exercise price was lower than our carrying value. ThisThe transaction closed in January 2015, and the Company recorded an additional loss wasof $6 million during the year ended December 31, 2015, calculated based on the final option price. These losses were determined using Level 3 inputs. In 2013, the Company recognized a gain of $139 million as a result of Coca-Cola FEMSA, an equity method investee, issuing additional shares of its own stock at a per share amount greater than the carrying value of the Company's per share investment. Accordingly, the Company is required to treat this type of transaction as if the Company had sold a proportionate share of its investment in Coca-Cola FEMSA. This gain was determined using Level 1 inputs. Refer to Note 17.
4
The Company recognized a net loss of $114 million on the exchange of shares it previously owned in certain equity method investees for shares in the newly formed entity CCEJ. CCEJ is also an equity method investee. The net loss represents the difference between the carrying value of the shares the Company relinquished2 and the fair value of the CCEJ shares received as a result of the transaction. The net loss and the initial carrying value of the Company's investment were calculated based on Level 1 inputs. Refer to Note 17.
Fair Value Measurements for Pension and Other Postretirement Benefit Plans
The fair value hierarchy discussed above is not only applicable to assets and liabilities that are included in our consolidated balance sheets but is also applied to certain other assets that indirectly impact our consolidated financial statements. For example, our Company sponsors and/or contributes to a number of pension and other postretirement benefit plans. Assets contributed by the Company become the property of the individual plans. Even though the Company no longer has control over these assets, we are indirectly impacted by subsequent fair value adjustments to these assets. The actual return on these assets impacts the Company's future net periodic benefit cost, as well as amounts recognized in our consolidated balance sheets. Refer to Note 13. The Company uses the fair value hierarchy to measure the fair value of assets held by our various pension and other postretirement benefit plans.

125131



Pension Plan Assets
The following table summarizes the levels within the fair value hierarchy for our pension plan assets as of December 31, 20142015 and 20132014 (in millions):
December 31, 2014 December 31, 2013December 31, 2015 December 31, 2014
Level 1
 Level 2
 Level 3
 Total
 Level 1
 Level 2
 Level 3
 Total
Level 1
 Level 2
 Level 3
 Total
 Level 1
 Level 2
 Level 3
 Total
Cash and cash equivalents$161
 $100
 $
 $261
 $331
 $183
 $
 $514
$128
 $148
 $
 $276
 $161
 $100
 $
 $261
Equity securities:                              
U.S.-based companies1,793
 6
 17
 1,816
 1,680
 7
 15
 1,702
1,562
 
 1
 1,563
 1,793
 6
 17
 1,816
International-based companies1,050
 13
 
 1,063
 1,271
 13
 
 1,284
802
 5
 10
 817
 1,050
 13
 
 1,063
Fixed-income securities:                              
Government bonds
 863
 3
 866
 
 719
 49
 768

 736
 1
 737
 
 863
 3
 866
Corporate bonds and debt securities
 1,533
 33
 1,566
 
 1,466
 40
 1,506

 1,171
 2
 1,173
 
 1,533
 33
 1,566
Mutual, pooled and commingled funds98
 1,134
 31
 1,263
 56
 1,531
 
 1,587
77
 1,046
 
 1,123
 98
 1,134
 31
 1,263
Hedge funds/limited partnerships
 215
 584
 799
 
 190
 353
 543

 205
 559
 764
 
 215
 584
 799
Real estate
 16
 392
 408
 
 
 251
 251

 
 464
 464
 
 16
 392
 408
Other
 14
 846
1 
860
 
 7
 584
1 
591

 15
 757
1 
772
 
 14
 846
1 
860
Total$3,102
 $3,894
 $1,906
 $8,902
 $3,338
 $4,116
 $1,292
 $8,746
$2,569
 $3,326
 $1,794
 $7,689
 $3,102
 $3,894
 $1,906
 $8,902
1 
Includes purchased annuity contracts and insurance-linked securities.
The following table provides a reconciliation of the beginning and ending balance of Level 3 assets for our U.S. and non-U.S. pension plans for the years ended December 31, 20142015 and 20132014 (in millions):
Fixed-Income Securities
 
Hedge
Funds/Limited
Partnerships

 Real Estate
 
Equity
Securities

 
Mutual,
Pooled and
Commingled
Funds

 Other
 Total
Fixed-Income Securities
 
Hedge
Funds/Limited
Partnerships

 Real Estate
 
Equity
Securities

 
Mutual,
Pooled and
Commingled
Funds

 Other
 Total
2013             
Balance at beginning of year$
 $400
 $257
 $14
 $
 $510
 $1,181
Actual return on plan assets:             
Related to assets still held at the reporting date(4) (6) 13
 
 
 39
 42
Related to assets sold during the year(2) 24
 6
 
 
 
 28
Purchases, sales and settlements — net95
 14
 (24) 1
 
 193
 279
Transfers in or out of Level 3 — net
 (78) 
 
 
 (172) (250)
Foreign currency translation
 (1) (1) 
 
 14
 12
Balance at end of year$89
 $353
 $251
 $15
 $
 $584
1 
$1,292
2014                          
Balance at beginning of year$89
 $353
 $251
 $15
 $
 $584
 $1,292
$89
 $353
 $251
 $15
 $
 $584
 $1,292
Actual return on plan assets:                          
Related to assets still held at the reporting date17
 (17) 29
 1
 
 50
 80
17
 (17) 29
 1
 
 50
 80
Related to assets sold during the year(2) 42
 7
 
 
 
 47
(2) 42
 7
 
 
 
 47
Purchases, sales and settlements — net(41) 198
 106
 1
 31
 241
 536
(41) 198
 106
 1
 31
 241
 536
Transfers in or out of Level 3 — net(27) 9
 
 
 
 
 (18)(27) 9
 
 
 
 
 (18)
Foreign currency translation
 (1) (1) 
 
 (29) (31)
 (1) (1) 
 
 (29) (31)
Balance at end of year$36
 $584
 $392
 $17
 $31
 $846
1 
$1,906
$36
 $584
 $392
 $17
 $31
 $846
1 
$1,906
2015             
Balance at beginning of year$36
 $584
 $392
 $17
 $31
 $846
 $1,906
Actual return on plan assets:             
Related to assets still held at the reporting date1
 (14) 32
 (6) 
 42
 55
Related to assets sold during the year(4) 45
 6
 
 
 
 47
Purchases, sales and settlements — net(6) (74) 32
 
 (2) (76)
2 
(126)
Transfers in or out of Level 3 — net(24) 21
 2
 
 (29) (3) (33)
Foreign currency translation
 (3) 
 
 
 (52) (55)
Balance at end of year$3
 $559
 $464
 $11
 $
 $757
1 
$1,794
1 
Includes purchased annuity contracts and insurance-linked securities.
2
Includes the transfer of assets associated with the Company's consolidated German bottling operations to assets held for sale and liabilities held for sale as of December 31, 2015. Refer to Note 2 for additional information.

126132



Other Postretirement Benefit Plan Assets
The following table summarizes the levels within the fair value hierarchy for our other postretirement benefit plan assets as of December 31, 20142015 and 20132014 (in millions):
December 31, 2014 December 31, 2013December 31, 2015 December 31, 2014
Level 1
 Level 2
 
Level 3 1

 Total
 Level 1
 Level 2
 
Level 3 1

 Total
Level 1
 Level 2
 
Level 3 1

 Total
 Level 1
 Level 2
 
Level 3 1

 Total
Cash and cash equivalents$9
 $1
 $
 $10
 $
 $10
 $
 $10
$1
 $7
 $
 $8
 $9
 $1
 $
 $10
Equity securities:                              
U.S.-based companies114
 
 
 114
 112
 
 
 112
116
 
 
 116
 114
 
 
 114
International-based companies7
 
 
 7
 8
 
 
 8
6
 
 
 6
 7
 
 
 7
Fixed-income securities:                              
Government bonds76
 3
 
 79
 76
 3
 
 79
77
 3
 
 80
 76
 3
 
 79
Corporate bonds and debt securities
 9
 
 9
 
 9
 
 9

 8
 
 8
 
 9
 
 9
Mutual, pooled and commingled funds10
 6
 
 16
 11
 7
 
 18
10
 5
 
 15
 10
 6
 
 16
Hedge funds/limited partnerships
 1
 4
 5
 
 1
 2
 3

 1
 4
 5
 
 1
 4
 5
Real estate
 
 3
 3
 
 
 2
 2

 
 3
 3
 
 
 3
 3
Other
 
 3
 3
 
 
 2
 2

 
 4
 4
 
 
 3
 3
Total$216
 $20
 $10
 $246
 $207
 $30
 $6
 $243
$210
 $24
 $11
 $245
 $216
 $20
 $10
 $246
1 
Level 3 assets are not a significant portion of other postretirement benefit plan assets.
Other Fair Value Disclosures
The carrying amounts of cash and cash equivalents; short-term investments; receivables; accounts payable and accrued expenses; and loans and notes payable approximate their fair values because of the relatively short-term maturities of these financial instruments.
The fair value of our long-term debt is estimated using Level 2 inputs based on quoted prices for those instruments. Where quoted prices are not available, fair value is estimated using discounted cash flows and market-based expectations for interest rates, credit risk and the contractual terms of the debt instruments. As of December 31, 2015, the carrying amount and fair value of our long-term debt, including the current portion, were $31,084 million and $31,308 million, respectively. As of December 31, 2014, the carrying amount and fair value of our long-term debt, including the current portion, were $22,615 million and $23,411 million, respectively. As of December 31, 2013, the carrying amount and fair value of our long-term debt, including the current portion, were $20,178 million and $20,352 million, respectively.
NOTE 17: SIGNIFICANT OPERATING AND NONOPERATING ITEMS
Other Operating Charges
In 2015, the Company incurred other operating charges of $1,657 million. These charges primarily consisted of $691 million due to the Company's productivity and reinvestment program and $292 million due to the integration of our German bottling operations. In addition, the Company recorded impairment charges of $418 million primarily due to the discontinuation of the energy products in the glacéau portfolio as a result of the Monster Transaction and incurred a charge of $100 million due to a cash contribution we made to The Coca-Cola Foundation. The Company also incurred a charge of $111 million due to the write-down of receivables from our bottling partner in Venezuela and an impairment of a Venezuelan trademark primarily due to changes in exchange rates as a result of the establishment of the new open market exchange system. Refer to Note 18 for additional information on the Company's productivity, integration and restructuring initiatives. Refer to Note 2 for additional information on the Monster Transaction. Refer to Note 1 for additional information on the Venezuelan currency change. Refer to Note 19 for the impact these charges had on our operating segments.

133



In 2014, the Company incurred other operating charges of $1,183 million. These charges primarily consisted of $601$601 million due to the Company's productivity and reinvestment program and $208$208 million due to the integration of our German bottling and distribution operations. In addition, the Company incurred a charge of $314 million due to a write-down we recorded related to our concentrate sales receivables from our bottling partner in Venezuela and an impairment of a Venezuelan trademark primarily due to changes in exchange rates. The write-down was recorded as a result of our revised assessment of the U.S. dollar value we expect to realize upon thelimited government-approved exchange rate conversion of the Venezuelan bolivar into U.S. dollars by our bottling partner to pay our concentrate sales receivables.mechanisms. The Company also recorded a loss of $36$36 million as a result of the restructuring and transition of the Company's Russian juice operations to an existing joint venture with an unconsolidated bottling partner. Refer to Note 18 for additional information on our productivity and reinvestment program as well as the Company's other productivity, integration and restructuring initiatives. Refer to Note 1 for additional information on the Venezuelan currency change. Refer to Note 19 for the impact these charges had on our operating segments.
In 2013, the Company incurred other operating charges of $895 million, which primarily consisted of $494$494 million associated with the Company's productivity and reinvestment program; $195 million due to the impairment of certain intangible assets described below; $188 million due to the Company's other restructuring and integration initiatives; and $22 million due to charges associated with certain of the Company's fixed assets. Refer to Note 18 for additional information on our productivity and reinvestment program as well as the Company's other productivity, integration and restructuring initiatives. Refer to Note 19 for the impact these charges had on our operating segments.

127



During the year ended December 31, 2013, the Company recorded charges of $195 million related to certain intangible assets. These charges included $113 million related to the impairment of trademarks recorded in our Bottling Investments and Asia Pacific operating segments. These impairments were primarily due to a strategic decision to phase out certain local-market value brands, which resulted in a change in the expected useful life of the intangible assets. The charges were determined by comparing the fair value of the trademarks, derived using discounted cash flow analyses, to the current carrying value. Additionally, the remaining charge of $82 million was related to goodwill recorded in our Bottling Investments operating segment. This charge was primarily the result of management's revised outlook on market conditions and volume performance.
Other Nonoperating Items
Interest Expense
In 2012,During the year ended December 31, 2015, the Company incurred other operatingrecorded charges of $447 million, which primarily consisted of $270 million associated with the Company's productivity and reinvestment program; $163 million related to the Company's other restructuring and integration initiatives; $20$320 million due to changes in the Company's ready-to-drink tea strategy as a resultearly extinguishment of our U.S. license agreement with Nestlé S.A. ("Nestlé") terminating at the end of 2012; and $8 million due to costs associated with the Company detecting carbendazim in orange juice imported from Brazil for distribution in the United States.certain long-term debt. These charges were partially offset by reversalsincluded the difference between the reacquisition price and the net carrying amount of $10 million associated with the refinementdebt extinguished, including the impact of previously established accrualsthe related to the Company's 2008–2011 productivity initiatives as well as reversals of $6 million associated with the refinement of previously established accruals related to the Company's integration of CCE's former North America business.fair value hedging relationship. Refer to Note 1810 for additional information on our productivity and reinvestment program as well as the Company's other productivity, integration and restructuring initiatives. Refer to Note 19 for the impact these chargesthis charge had on our operating segments.
Other Nonoperating Items
Equity Income (Loss) — Net
The Company recorded net charges of $18$87 million, $18 million and $159 million and a net gain of $8 million in equity income (loss) — net during the years ended December 31, 20142015, 20132014 and 20122013, respectively. These amounts primarily represent the Company's proportionate share of unusual or infrequent items recorded by certain of our equity method investees. Refer to Note 19 for the impact these charges had on our operating segments.
Other Income (Loss) — Net
In 2012,2015, the Company also recorded a net gain of $1,403 million as a result of the Monster Transaction and charges of $1,006 million due to the refranchising of certain territories in North America. In addition, the Company recognized a foreign currency exchange gain of $300 million associated with our foreign-denominated debt partially offset by a charge of $11$27 million due to the remeasurement of the net monetary assets of our Venezuelan subsidiary using the SIMADI exchange rate. Refer to Note 2 for additional information related to changesthe Monster Transaction and North America refranchising. Refer to Note 1 for additional information related to the charge due to the remeasurement in the structure of Beverage Partners Worldwide ("BPW"), our 50/50 joint venture with Nestlé in the ready-to-drink tea category. These changes resulted in the joint venture focusing its geographic scope primarily on Europe and Canada. The Company accounts for our investment in BPW under the equity method of accounting.
Venezuela. Refer to Note 19 for the impact these items had on our operating segments.
Other Income (Loss) — Net
In 2014, the Company recorded charges of $799 million due to the refranchising of certain territories in North America. The Company also incurred a charge of $372 million due to the remeasurement of the net monetary assets of our Venezuelan subsidiary using the SICAD 2 exchange rate. Refer to Note 2 for more information related to the North America refranchising, Note 1 for more information related to the charge due to the remeasurement in Venezuela and Note 19 for the impact these charges had on our operating segments.

134



In 2013, the Company recorded a gain of $615 million due to the deconsolidation of our Brazilian bottling operations as a result of their combination with an independent bottling partner. Subsequent to this transaction, the Company accounts for our investment in the newly combined Brazilian bottling operations under the equity method of accounting. The owners of the majority interest received the option to acquire from us up to 24 percent of the new entity's outstanding shares at any time for a period of six years beginning December 31, 2013. In December 2014, the Company received notification that the owners of the majority interest had exercised their option to acquire from us a 10 percent interest in the entity's outstanding shares. During the year ended December 31, 2014, we recorded aan estimated loss of $32 million as a result of the exercise price being lower than our carrying value. The transaction closed in January 2015, and the Company recorded an additional loss of $6 million during the year ended December 31, 2015, based on the final option price. Refer to Note 2 for additional information on this transaction. Refer to Note 19 for the impact these items had on our operating segments.
Effective July 1, 2013, four of the Company's Japanese bottling partners merged as CCEJ,Coca-Cola East Japan Bottling Company, Ltd. ("CCEJ"), a publicly traded entity, through a share exchange. The terms of the agreement included the issuance of new shares of one of the publicly traded bottlers in exchange for 100 percent of the outstanding shares of the remaining three bottlers according to an agreed-upon share exchange ratio. As a result, the Company recorded a net charge of $114 million for those investments in which the Company's carrying value was greater than the fair value of the shares received. Refer to Note 19 for the impact this loss had on our operating segments.
In 2013, the Company recorded a charge of $140 million due to the Venezuelan government announcing a currency devaluation. As a result of this devaluation, the Company remeasured the net monetary assets related to its operations in Venezuela. Refer to Note 19 for the impact this charge had on our operating segments. The Company also recognized a gain of $139 million due to Coca-Cola FEMSA issuing additional shares of its own stock at a per share amount greater than the carrying value of the Company's per share investment. Accordingly, the Company is required to treat this type of transaction as

128



if the Company sold a proportionate share of its investment in Coca-Cola FEMSA. Refer to Note 16 for additional information on the measurement of the gain and Note 19 for the impact this gain had on our operating segments.
In 2012, the Company recognized a gain of $185 million as a result of the merger of Andina and Polar, with Andina being the acquiring company. Prior to this transaction, the Company held an investment in Andina that we accounted for as an available-for-sale security as well as an investment in Polar that we accounted for under the equity method of accounting. The merger of the two companies was a noncash transaction that resulted in Polar shareholders exchanging their existing Polar shares for newly issued shares of Andina at a specified exchange rate. As a result, the Company now holds an investment in Andina that we account for as an equity method investment. Refer to Note 19 for the impact this gain had on our operating segments.
On December 13, 2012, the Company and Coca-Cola FEMSA executed a share purchase agreement for the sale of a majority ownership interest in our consolidated Philippine bottling operations. This transaction was completed on January 25, 2013. As a result of this agreement, the Company was required to classify our Philippine bottling operations as held for sale in our consolidated balance sheet as of December 31, 2012. We also recognized a loss of $108 million during the year ended December 31, 2012, based on the agreed-upon sale price and related transaction costs. Refer to Note 19 for the impact this loss had on our operating segments.
The Company also recognized a gain of $92 million in 2012 as a result of Coca-Cola FEMSA issuing additional shares of its own stock at a per share amount greater than the carrying value of the Company's investment. Accordingly, the Company is required to treat this type of transaction as if we sold a proportionate share of our investment in Coca-Cola FEMSA. Refer to Note 19 for the impact this gain had on our operating segments.
During the year ended December 31, 2012, the Company recorded a charge of $82 million due to the acquisition of an ownership interest in Mikuni for which we paid a premium over the publicly traded market price. Although the Company paid this premium to obtain specific rights that have an economic and strategic value to the Company, they do not qualify as an asset and were recorded as expense on the acquisition date. For the impact that this charge had on our operating segments, refer to Note 19. The Company accounted for our investment in Mikuni under the equity method of accounting prior to the merger of the four bottlers into CCEJ discussed above.
The Company also recognized charges of $16 million during the year ended December 31, 2012, due to other-than-temporary declines in the fair values of certain cost method investments. Refer to Note 19 for the impact these charges had on our operating segments.
NOTE 18: PRODUCTIVITY, INTEGRATION AND RESTRUCTURING INITIATIVES
Productivity and Reinvestment
In February 2012, the Company announced a four-year productivity and reinvestment program which is designed to assist us in strengtheningfurther enable our efforts to strengthen our brands and reinvestingreinvest our resources to drive long-term profitable growth. This program is focused on the following initiatives: global supply chain optimization; global marketing and innovation effectiveness; operating expense leverage and operational excellence; data and information technology systems standardization; and furtherthe integration of Old CCE's former North America business.American bottling operations.
In February 2014, the Company announced the expansion of our productivity and reinvestment program to drive incremental productivity by 2016 that will primarily be redirected into increased media investments. Our incremental productivity goal consists of two relatively equal components. First, we will expand savings through global supply chain optimization, data and information technology systems standardization, and resource and cost reallocation. Second, we will increase the effectiveness of our marketing investments by transforming our marketing and commercial model to redeploy resources into more consumer-facing marketing investments to accelerate growth.
In October 2014, the Company announced that we arewere further expanding our productivity and reinvestment program and extending it through 2019. The expansion of the productivity initiatives will focus on four key areas: restructuring the Company's global supply chain, including manufacturing in North America; implementing zero-based budgetingwork, an evolution of zero-based budget principles, across the organization; streamlining and simplifying the Company's operating model; and further driving increased discipline and efficiency in direct marketing investments.
The Company has incurred total pretax expenses of $1,365$2,056 million related to this program since it commenced. These expenses were recorded in the line item other operating charges in our consolidated statement of income. Refer to Note 19 for the impact these charges had on our operating segments. Outside services reported in the table below primarily relate to expenses in connection with legal, outplacement and consulting activities. Other direct costs reported in the table below include, among other items, internal and external costs associated with the development, communication, administration and implementation of these initiatives; accelerated depreciation on certain fixed assets; contract termination fees; and relocation costs.

129135



The following table summarizes the balance of accrued expenses related to these productivity and reinvestment initiatives and the changes in the accrued amounts since the commencement of the plan (in millions):
Severance Pay
and Benefits

 Outside Services
 
Other
Direct Costs

 Total
Severance Pay
and Benefits

 Outside Services
 
Other
Direct Costs

 Total
2012       
Costs incurred$21
 $61
 $188
 $270
Payments(8) (55) (167) (230)
Noncash and exchange(1) 
 (13) (14)
Accrued balance as of December 31$12
 $6
 $8
 $26
2013              
Accrued balance as of January 1$12
 $6
 $8
 $26
Costs incurred$188
 $59
 $247
 $494
188
 59
 247
 494
Payments(113) (59) (209) (381)(113) (59) (209) (381)
Noncash and exchange1
 
 (28) (27)1
 
 (28) (27)
Accrued balance as of December 31$88
 $6
 $18
 $112
$88
 $6
 $18
 $112
2014              
Costs incurred$277
 $77
 $247
 $601
$277
 $77
 $247
 $601
Payments(103) (79) (220) (402)(103) (79) (220) (402)
Noncash and exchange(2) 
 (24) (26)(2) 
 (24) (26)
Accrued balance as of December 31$260
 $4
 $21
 $285
$260
 $4
 $21
 $285
2015       
Costs incurred$269
 $56
 $366
 $691
Payments(200) (47) (265) (512)
Noncash and exchange(185)
1 
(5) (70) (260)
Accrued balance as of December 31$144
 $8
 $52
 $204
1 Includes pension settlement charges. Refer to Note 13.
Integration Initiatives
Integration of Our German Bottling and Distribution Operations
In 2008, the Company began an integration initiative related to the 18our German bottling and distribution operations acquired in 2007. The Company incurred $292 million, $208 million $187 million and $148$187 million of expenses related to this initiative in 2015, 2014 2013 and 2012,2013, respectively, and has incurred total pretax expenses of $835$1,127 million related to this initiative since it commenced. These expenses were recorded in the line item other operating charges in our consolidated statements of income and impacted the Bottling Investments operating segment. The expenses recorded in connection with these integration activities have been primarily due to involuntary terminations. The Company had $101$122 million and $127$101 million accrued related to these integration costs as of December 31, 20142015 and 2013,2014, respectively.
The Company is currently reviewing other restructuring opportunities within the German bottling and distribution operations, which if implemented will result in additional charges in future periods. However, as of December 31, 2014,2015, the Company had not finalized any additional plans.
NOTE 19: OPERATING SEGMENTS
As of December 31, 2014,2015, our organizational structure consisted of the following operating segments: Eurasia and Africa; Europe; Latin America; North America; Asia Pacific; Bottling Investments; and Corporate.

136



Segment Products and Services
The business of our Company is nonalcoholic beverages. With the exception of North America, our geographic operating segments (Eurasia and Africa; Europe; Latin America; North America; and Asia Pacific) derive a majority of their revenues from the manufacture and sale of beverage concentrates and syrups and, in some cases, the sale of finished beverages. The North America operating segment derives the majority of its revenues from the sale of finished beverages. Our Bottling Investments operating segment is composed of our Company-owned or consolidated bottling operations outside of North America, regardless of the geographic location of the bottler, and equity income from the majority of our equity method investments. Company-owned or consolidated bottling operations derive the majority of their revenues from the sale of finished beverages. Generally, bottling and finished product operations produce higher net operating revenues but lower gross profit margins compared to concentrate and syrup operations.

130



The following table sets forth the percentage of total net operating revenues related to concentrate operations and finished product operations:
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
Concentrate operations1
38% 38% 38%37% 38% 38%
Finished product operations2
62

62
 62
63

62
 62
Net operating revenues100% 100% 100%
Total100% 100% 100%
1 
Includes concentrates sold by the Company to authorized bottling partners for the manufacture of fountain syrups. The bottlers then typically sell the fountain syrups to wholesalers or directly to fountain retailers.
2 
Includes fountain syrups manufactured by the Company, including consolidated bottling operations, and sold to fountain retailers or to authorized fountain wholesalers or bottling partners who resell the fountain syrups to fountain retailers.
Method of Determining Segment Income or Loss
Management evaluates the performance of our operating segments separately to individually monitor the different factors affecting financial performance. Our Company manages income taxes and certain treasury-related items, such as interest income and expense, on a global basis within the Corporate operating segment. We evaluate segment performance based on income or loss before income taxes.
Geographic Data
The following table provides information related to our net operating revenues (in millions):
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
United States$19,763
 $19,820
 $19,732
$20,360
 $19,763
 $19,820
International26,235
 27,034
 28,285
23,934
 26,235
 27,034
Net operating revenues$45,998
 $46,854
 $48,017
$44,294
 $45,998
 $46,854
The following table provides information related to our property, plant and equipment — net (in millions):
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
United States$8,683
 $8,841
 $8,509
$8,266
 $8,683
 $8,841
International5,950
 6,126
 5,967
4,305
 5,950
 6,126
Property, plant and equipment — net$14,633
 $14,967
 $14,476
$12,571
 $14,633
 $14,967

131137



Information about our Company's operations by operating segment as of and for the years ended December 31, 2015, 2014 2013 and 2012,2013, is as follows (in millions):
Eurasia &
Africa

 Europe
 
Latin
America

 
North
America

 Asia Pacific
 
Bottling
Investments

 Corporate
 Eliminations
 Consolidated
Eurasia &
Africa

 Europe
 
Latin
America

 
North
America

 Asia Pacific
 
Bottling
Investments

 Corporate
 Eliminations
 Consolidated
2015                 
Net operating revenues:                 
Third party$2,423
 $4,543
 $3,999
 $21,784
 $4,707

$6,682
 $156
 $
 $44,294
Intersegment36
 585
 75
 18
 545
 49
 10
 (1,318) 
Total net revenues2,459
 5,128
 4,074
 21,802
 5,252
 6,731
 166
 (1,318) 44,294
Operating income (loss)987
 2,888
 2,169
 2,490
 2,189
 
 (1,995) 
 8,728
Interest income
 
 
 9
 
 
 604
 
 613
Interest expense
 
 
 
 
 
 856
 
 856
Depreciation and amortization44
 59
 41
 1,217
 85
 367
 157
 
 1,970
Equity income (loss) — net14
 25
 (7) (17) 9
 425
 40
 
 489
Income (loss) before income taxes1,004
 2,919
 2,164
 1,475
 2,207
 454
 (618) 
 9,605
Identifiable operating assets1
1,148
 3,008
2 
1,627
 32,042
 1,639
 7,042
2 
27,799
 
 74,305
Investments3
1,061
 77
 657
 118
 158
 8,073
 5,644
 
 15,788
Capital expenditures19
 35
 70
 1,341
 81
 735
 272
 
 2,553
2014                                  
Net operating revenues:                                  
Third party$2,730
 $4,844
 $4,597
 $21,462
 $5,257

$6,972
 $136
 $
 $45,998
$2,730
 $4,844
 $4,597
 $21,462
 $5,257
 $6,972
 $136
 $
 $45,998
Intersegment
 692
 60
 17
 489
 67
 
 (1,325) 

 692
 60
 17
 489
 67
 
 (1,325) 
Total net revenues2,730
 5,536
 4,657
 21,479
 5,746
 7,039
 136
 (1,325) 45,998
2,730
 5,536
 4,657
 21,479
 5,746
 7,039
 136
 (1,325) 45,998
Operating income (loss)1,084
 2,852
 2,316
 2,447
 2,448
 9
 (1,448) 
 9,708
1,084
 2,852
 2,316
 2,447
 2,448
 9
 (1,448) 
 9,708
Interest income
 
 
 
 
 
 594
 
 594

 
 
 
 
 
 594
 
 594
Interest expense
 
 
 
 
 
 483
 
 483

 
 
 
 
 
 483
 
 483
Depreciation and amortization47
 75
 56
 1,195
 96
 315
 192
 
 1,976
47
 75
 56
 1,195
 96
 315
 192
 
 1,976
Equity income (loss) — net35
 31
 10
 (16) 12
 691
 6
 
 769
35
 31
 10
 (16) 12
 691
 6
 
 769
Income (loss) before income taxes1,125
 2,892
 2,319
 1,633
 2,464
 715
 (1,823) 
 9,325
1,125
 2,892
 2,319
 1,633
 2,464
 715
 (1,823) 
 9,325
Identifiable operating assets1
1,298
 3,358
2 
2,426
 33,066
 1,793
 6,975
2 
29,482
 
 78,398
1,298
 3,358
2 
2,426
 33,066
 1,793
 6,975
2 
29,482
 
 78,398
Investments3
1,081
 90
 757
 48
 157
 8,781
 2,711
 
 13,625
1,081
 90
 757
 48
 157
 8,781
 2,711
 
 13,625
Capital expenditures30
 54
 55
 1,293
 76
 628
 270
 
 2,406
30
 54
 55
 1,293
 76
 628
 270
 
 2,406
2013                                  
Net operating revenues:                                  
Third party$2,763
 $4,645
 $4,748
 $21,574
 $5,372
 $7,598
 $154
 $
 $46,854
$2,763
 $4,645
 $4,748
 $21,574
 $5,372
 $7,598
 $154
 $
 $46,854
Intersegment
 689
 191
 16
 497
 78
 
 (1,471) 

 689
 191
 16
 497
 78
 
 (1,471) 
Total net revenues2,763
 5,334
 4,939
 21,590
 5,869
 7,676
 154
 (1,471) 46,854
2,763
 5,334
 4,939
 21,590
 5,869
 7,676
 154
 (1,471) 46,854
Operating income (loss)1,087
 2,859
 2,908
 2,432
 2,478
 115
 (1,651) 
 10,228
1,087
 2,859
 2,908
 2,432
 2,478
 115
 (1,651) 
 10,228
Interest income
 
 
 
 
 
 534
 
 534

 
 
 
 
 
 534
 
 534
Interest expense
 
 
 
 
 
 463
 
 463

 
 
 
 
 
 463
 
 463
Depreciation and amortization42
 86
 58
 1,192
 130
 335
 134
 
 1,977
42
 86
 58
 1,192
 130
 335
 134
 
 1,977
Equity income (loss) — net22
 24
 13
 2
 19
 524
 (2) 
 602
22
 24
 13
 2
 19
 524
 (2) 
 602
Income (loss) before income taxes1,109
 2,923
 2,920
 2,434
 2,494
 679
 (1,082) 
 11,477
1,109
 2,923
 2,920
 2,434
 2,494
 679
 (1,082) 
 11,477
Identifiable operating assets1
1,273
 3,713
2 
2,918
 33,964
 1,922
 7,011
2 
27,742
 
 78,543
1,273
 3,713
2 
2,918
 33,964
 1,922
 7,011
2 
27,742
 
 78,543
Investments3
1,157
 106
 545
 49
 143
 9,424
 88
 
 11,512
1,157
 106
 545
 49
 143
 9,424
 88
 
 11,512
Capital expenditures40
 34
 63
 1,374
 117
 643
 279
 
 2,550
40
 34
 63
 1,374
 117
 643
 279
 
 2,550
2012                 
Net operating revenues:                 
Third party$2,697
 $4,481
 $4,560
 $21,665
 $5,680
 $8,807
 $127
 $
 $48,017
Intersegment
 642
 271
 15
 628
 88
 
 (1,644) 
Total net revenues2,697
 5,123
 4,831
 21,680
 6,308
 8,895
 127
 (1,644) 48,017
Operating income (loss)1,078
 2,960
 2,879
 2,597
 2,516
 140
 (1,391) 
 10,779
Interest income
 
 
 
 
 
 471
 
 471
Interest expense
 
 
 
 
 
 397
 
 397
Depreciation and amortization33
 100
 70
 1,083
 119
 406
 171
 
 1,982
Equity income (loss) — net20
 45
 4
 13
 2
 732
 3
 
 819
Income (loss) before income taxes1,101
 3,015
 2,882
 2,624
 2,523
 904
 (1,240) 
 11,809
Identifiable operating assets1
1,299
 2,976
2 
2,759
 34,114
 2,163
 9,648
2 
22,767
 
 75,726
Investments3
1,155
 271
 539
 39
 127
 8,253
 64
 
 10,448
Capital expenditures51
 30
 88
 1,447
 107
 867
 190
 
 2,780
1 
Principally cash and cash equivalents, short-term investments, marketable securities, trade accounts receivable, inventories, goodwill, trademarks and other intangible assets, and property, plant and equipment — net.
2 
Property, plant and equipment — net in Germany represented 10 percent of consolidated property, plant and equipment — net in 2015, 10 percent in 2014 and 11 percent in 20132013. The 2015 amount includes property, plant and 10 percent in 2012.equipment — net classified as held for sale.
3 
Principally equity method investments available-for-sale securities and nonmarketableother investments in bottling companies.

132138



In 2015, the results of our operating segments were impacted by the following items:
Operating income (loss) and income (loss) before income taxes were reduced by $16 million for Eurasia and Africa, $7 million for Latin America, $384 million for North America, $2 million for Asia Pacific, $353 million for Bottling Investments and $246 million for Corporate due to the Company's productivity and reinvestment program as well as other restructuring initiatives. Operating income (loss) and income (loss) before income taxes were increased by $25 million for Europe due to the refinement of previously established accruals related to the Company's productivity and reinvestment program. Refer to Note 18.
Operating income (loss) and income (loss) before income taxes were reduced by $418 million for Corporate primarily due to an impairment charge primarily related to the discontinuation of the energy products in the glacéau portfolio as a result of the Monster Transaction. Refer to Note 2 and Note 17.
Operating income (loss) and income (loss) before income taxes were reduced by $100 million for Corporate as a result of a cash contribution to The Coca-Cola Foundation. Refer to Note 17.
Income (loss) before income taxes was increased by $1,403 million for Corporate as a result of the Monster Transaction. Refer to Note 2 and Note 17.
Income (loss) before income taxes was reduced by $1,006 million for North America due to the refranchising of certain territories in North America. Refer to Note 2 and Note 17.
Income (loss) before income taxes was reduced by $320 million for Corporate due to charges the Company recognized on the early extinguishment of certain long-term debt. Refer to Note 10 and Note 17.
Income (loss) before income taxes was reduced by $33 million for Latin America and $105 million for Corporate due to the remeasurement of the net monetary assets of our local Venezuelan subsidiary into U.S. dollars using the SIMADI exchange rate, an impairment of a Venezuelan trademark, and a write-down the Company recorded on receivables from our bottling partner in Venezuela. Refer to Note 1 and Note 17.
Income (loss) before income taxes was reduced by $19 million for Corporate as a result of the remeasurement of our previously held equity interest in a South African bottler to fair value upon our acquisition of the bottling operations. Refer to Note 2.
Income (loss) before income taxes was reduced by $6 million for Corporate as a result of a Brazilian bottling entity's majority interest owners exercising their option to acquire from us an additional equity interest at an exercise price less than that of our carrying value. Refer to Note 2 and Note 17.
Income (loss) before income taxes was increased by $3 million for Eurasia and Africa and reduced by $7 million for Europe and $83 million for Bottling Investments due to the Company's proportionate share of unusual or infrequent items recorded by certain of our equity method investees. Refer to Note 17.
In 2014, the results of our operating segments were impacted by the following items:
Operating income (loss) and income (loss) before income taxes were reduced by $26 million for Eurasia and Africa, $111 million for Europe, $20 million for Latin America, $281 million for North America, $36 million for Asia Pacific, $211 million for Bottling Investments and $124 million for Corporate due to charges related to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 18.
Operating income (loss) and income (loss) before income taxes were reduced by $42 million for Bottling Investments as a result of the restructuring and transition of the Company's Russian juice operations to an existing joint venture with an unconsolidated bottling partner. Refer to Note 17.
Income (loss) before income taxes was reduced by $2 million for Europe and $16 million for Bottling Investments due to the Company's proportionate share of unusual or infrequent items recorded by certain of our equity method investees. Refer to Note 17.
Income (loss) before income taxes was reduced by $799 million for North America due to the refranchising of certain territories. Refer to Note 2 and Note 17.
Income (loss) before income taxes was reduced by $275 million for Latin America and $411 million for Corporate due to the remeasurement of the net monetary assets of our local Venezuelan subsidiary into U.S. dollars using the SICAD 2 exchange rate, an impairment of a Venezuelan trademark, and a write-down the Company recorded on the concentrate sales receivables from our bottling partner in Venezuela. Refer to Note 1 and Note 17.

139



Income (loss) before income taxes was increased by $25 million for Bottling Investments due to the elimination of intercompany profits resulting from a write-down we recorded on the concentrate sales receivables from our bottling partner in Venezuela, an equity method investee, partially offset by our proportionate share of their remeasurement loss. Refer to Note 1.
Income (loss) before income taxes was reduced by $32 million for Corporate as a result of a Brazilian bottling entity's majority interest owners exercising their option to acquire from us an additional equity interest at an exercise price less than that of our carrying value. Refer to Note 2 and Note 17.
In 2013, the results of our operating segments were impacted by the following items:
Operating income (loss) and income (loss) before income taxes were reduced by $2 million for Eurasia and Africa, $57 million for Europe, $282 million for North America, $26 million for Asia Pacific, $194 million for Bottling Investments and $121 million for Corporate due to charges related to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 18.
Operating income (loss) and income (loss) before income taxes were reduced by $195 million for Corporate due to impairment charges recorded on certain of the Company's intangible assets. Refer to Note 8 and Note 17.
Operating income (loss) and income (loss) before income taxes were reduced by $22 million for Asia Pacific due to charges associated with certain of the Company's fixed assets. Refer to Note 17.
Income (loss) before income taxes was increased by $615 million for Corporate due to a gain the Company recognized on the deconsolidation of our Brazilian bottling operations as a result of their combination with an independent bottling partner. Refer to Note 2.17.
Income (loss) before income taxes was reduced by $9 million for Bottling Investments and $140 million for Corporate due to the devaluation of the Venezuelan bolivar, including our proportionate share of the charge incurred by an equity method investee that has operations in Venezuela. Refer to Note 1 and Note 17.
Income (loss) before income taxes was reduced by a net $114 million for Corporate due to the merger of four of the Company's Japanese bottling partners in which we held equity method investments prior to their merger into CCEJ. Refer to Note 2 and Note 17.
Income (loss) before income taxes was increased by $139 million for Corporate due to a gain the Company recognized as a result of Coca-Cola FEMSA issuing additional shares of its own stock during the year at a per share amount greater than the carrying value of the Company's per share investment. Refer to Note 16 and Note 17.
Income (loss) before income taxes was reduced by a net $159 million for Bottling Investments due to the Company’s proportionate share of unusual or infrequent items recorded by certain of our equity method investees. Refer to Note 17.

133



Income (loss) before income taxes was reduced by $53 million for Corporate due to charges the Company recognized on the early extinguishment of certain long-term debt, including the hedge accounting adjustments reclassified from accumulated other comprehensive income to earnings. Refer to Note 10.
In 2012, the results of our operating segments were impacted by the following items:
Operating income (loss) and income (loss) before income taxes were reduced by $1 million for Europe, $227 million for North America, $3 million for Asia Pacific, $164 million for Bottling Investments and $38 million for Corporate due to charges related to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 18.
Operating income (loss) and income (loss) before income taxes were reduced by $21 million for North America due to costs associated with the Company detecting residues of carbendazim, a fungicide that is not registered in the United States for use on citrus products, in orange juice imported from Brazil for distribution in the United States. As a result, the Company began purchasing additional supplies of Florida orange juice at a higher cost than Brazilian orange juice. Refer to Note 17.
Operating income (loss) and income (loss) before income taxes were reduced by $20 million for North America due to changes in the Company's ready-to-drink tea strategy as a result of our U.S. license agreement with Nestlé that terminated at the end of 2012. Refer to Note 17.
Equity income (loss) — net and income (loss) before income taxes were increased by $8 million for Bottling Investments due to the Company’s proportionate share of unusual or infrequent items recorded by certain of our equity method investees. Refer to Note 17.
Income (loss) before income taxes was increased by $185 million for Corporate due to the gain the Company recognized as a result of the merger of Andina and Polar. Refer to Note 17.
Income (loss) before income taxes was reduced by $108 million for Corporate due to the loss the Company recognized on the pending sale of a majority ownership interest in our Philippine bottling operations to Coca-Cola FEMSA, which was completed in January 2013. As of December 31, 2012, the assets and liabilities associated with our Philippine bottling operations were classified as held for sale in our consolidated balance sheets. Refer to Note 17.
Income (loss) before income taxes was increased by $92 million for Corporate due to a gain the Company recognized as a result of Coca-Cola FEMSA issuing additional shares of its own stock during the year at a per share amount greater than the carrying amount of the Company's per share investment. Refer to Note 17.
Income (loss) before income taxes was reduced by $82 million for Corporate due to the Company acquiring an ownership interest in Mikuni for which we paid a premium over the publicly traded market price. This premium was expensed on the acquisition date. Refer to Note 17.
Income (loss) before income taxes was reduced by $16 million for Corporate due to other-than-temporary declines in the fair values of certain cost method investments. Refer to Note 16 and Note 17.
Income (loss) before income taxes was reduced by $1 million for Eurasia and Africa, $4 million for Europe, $2 million for Latin America and $4 million for Asia Pacific due to changes in the structure of BPW, our 50/50 joint venture with Nestlé in the ready-to-drink tea category. Refer to Note 17.
NOTE 20: NET CHANGE IN OPERATING ASSETS AND LIABILITIES
Net cash provided by (used in) operating activities attributable to the net change in operating assets and liabilities is composed of the following (in millions):
Year Ended December 31,2014
 2013
 2012
2015
 2014
 2013
(Increase) decrease in trade accounts receivable$(253) $28
 $(33)$(212) $(253) $28
(Increase) decrease in inventories35
 (105) (286)(250) 35
 (105)
(Increase) decrease in prepaid expenses and other assets194
 (163) (29)123
 194
 (163)
Increase (decrease) in accounts payable and accrued expenses(250) (158) (556)1,004
 (250) (158)
Increase (decrease) in accrued taxes151
 22
 770
(306) 151
 22
Increase (decrease) in other liabilities(316) (556) (946)(516) (316) (556)
Net change in operating assets and liabilities$(439) $(932) $(1,080)$(157) $(439) $(932)

134140



NOTE 21: SUBSEQUENT EVENT
In February 2016, additional territories in North America met the criteria to be classified as held for sale. Therefore, we are required to record the related assets and liabilities at the lower of carrying value or fair value less any costs to sell based on the estimated sale price, which will result in a noncash loss of $296 million in 2016. This loss is primarily related to the write-down of intangible assets due to the accounting treatment for the contingent consideration that will be received in exchange for the grant of the exclusive territory rights. The Company expects these territories to be refranchised at various times throughout 2016. Refer to Note 2 for additional information about North America refranchising.
The following table presents information related to the major classes of assets and liabilities related to these additional territories, which were included in the North America operating segment (in millions):
  
Inventories$4
Prepaid expenses and other assets1
Property, plant and equipment — net62
Bottlers' franchise rights with indefinite lives273
Goodwill10
Other intangible assets13
Allowance for reduction of assets held for sale(296)
Total assets$67
Accounts payable and accrued expenses$1
Other liabilities1
Deferred income taxes19
Total liabilities$21

141



REPORT OF MANAGEMENT
Management's Responsibility for the Financial Statements
Management of the Company is responsible for the preparation and integrity of the consolidated financial statements appearing in our annual reportAnnual Report on Form 10-K. The financial statements were prepared in conformity with generally accepted accounting principles appropriate in the circumstances and, accordingly, include certain amounts based on our best judgments and estimates. Financial information in this annual reportAnnual Report on Form 10-K is consistent with that in the financial statements.
Management of the Company is responsible for establishing and maintaining a system of internal controls and procedures to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the consolidated financial statements. Our internal control system is supported by a program of internal audits and appropriate reviews by management, written policies and guidelines, careful selection and training of qualified personnel, and a written Code of Business Conduct adopted by our Company's Board of Directors, applicable to all officers and employees of our Company and subsidiaries. In addition, our Company's Board of Directors adopted a written Code of Business Conduct for Non-Employee Directors which reflects the same principles and values as our Code of Business Conduct for officers and employees but focuses on matters of relevance to non-employee Directors.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements and, even when determined to be effective, can only provide reasonable assurance with respect to financial statement preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Management's Report on Internal Control Over Financial Reporting
Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended ("Exchange Act"). Management assessed the effectiveness of the Company's internal control over financial reporting as of December 31, 2014.2015. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (2013 Framework) ("COSO") in Internal Control — Integrated Framework. Based on this assessment, management believes that the Company maintained effective internal control over financial reporting as of December 31, 2014.2015.
The Company's independent auditors, Ernst & Young LLP, a registered public accounting firm, are appointed by the Audit Committee of the Company's Board of Directors, subject to ratification by our Company's shareowners. Ernst & Young LLP has audited and reported on the consolidated financial statements of The Coca-Cola Company and subsidiaries and the Company's internal control over financial reporting. The reports of the independent auditors are contained in this annual report.

135142



Audit Committee's Responsibility
The Audit Committee of our Company's Board of Directors, composed solely of Directors who are independent in accordance with the requirements of the New York Stock Exchange listing standards, the Exchange Act, and the Company's Corporate Governance Guidelines, meets with the independent auditors, management and internal auditors periodically to discuss internal controls and auditing and financial reporting matters. The Audit Committee reviews with the independent auditors the scope and results of the audit effort. The Audit Committee also meets periodically with the independent auditors and the chief internal auditor without management present to ensure that the independent auditors and the chief internal auditor have free access to the Audit Committee. Our Audit Committee's Report can be found in the Company's 20152016 Proxy Statement.
 
Muhtar Kent Larry M. MarkKathy N. Waller
Chairman of the Board of Directors
and Chief Executive Officer and President
February 25, 20152016
 
Vice President and Controller
February 25, 2015
Kathy N. WallerMark Randazza
Executive Vice President
and Chief Financial Officer
February 25, 20152016
James R. QuinceyLarry M. Mark
President and Chief Operating Officer
February 25, 2016
Vice President and Controller
February 25, 2016
Mark Randazza
 Vice President and Assistant Controller
February 25, 20152016

136143



Report of Independent Registered Public Accounting Firm

Board of Directors and Shareowners
The Coca-Cola Company
We have audited the accompanying consolidated balance sheets of The Coca-Cola Company and subsidiaries as of December 31, 20142015 and 20132014, and the related consolidated statements of income, comprehensive income, shareowners' equity, and cash flows for each of the three years in the period ended December 31, 20142015. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of The Coca-Cola Company and subsidiaries at December 31, 20142015 and 20132014, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 20142015, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), The Coca-Cola Company and subsidiaries' internal control over financial reporting as of December 31, 20142015, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 Framework) and our report dated February 25, 20152016 expressed an unqualified opinion thereon.
                            
                                

Atlanta, Georgia
February 25, 20152016

137144



Report of Independent Registered Public Accounting Firm
on Internal Control Over Financial Reporting

Board of Directors and Shareowners
The Coca-Cola Company
We have audited The Coca-Cola Company and subsidiaries' internal control over financial reporting as of December 31, 20142015, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 Framework) (the COSO criteria). The Coca-Cola Company and subsidiaries' management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management's Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company's internal control over financial reporting based on our audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
In our opinion, The Coca-Cola Company and subsidiaries maintained, in all material respects, effective internal control over financial reporting as of December 31, 20142015, based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of The Coca-Cola Company and subsidiaries as of December 31, 20142015 and 20132014, and the related consolidated statements of income, comprehensive income, shareowners' equity, and cash flows for each of the three years in the period ended December 31, 20142015, and our report dated February 25, 20152016 expressed an unqualified opinion thereon.

                                
                                            
Atlanta, Georgia
February 25, 20152016

138145



Quarterly Data (Unaudited)
First
Quarter

 
Second
Quarter

 
Third
Quarter

 
Fourth
Quarter

 Full Year
 
First
Quarter

 
Second
Quarter

 
Third
Quarter

 
Fourth
Quarter

 Full Year
 
(In millions except per share data)                    
2015          
Net operating revenues$10,711
 $12,156
 $11,427
 $10,000
 $44,294
 
Gross profit6,608
 7,408
 6,850
 5,946
 26,812
 
Net income attributable to shareowners of
The Coca-Cola Company
1,557
 3,108
 1,449
 1,237
 7,351
 
Basic net income per share$0.36
 $0.71
 $0.33
 $0.29
 $1.69
 
Diluted net income per share$0.35
 $0.71
 $0.33
 $0.28
 $1.67
 
2014                    
Net operating revenues$10,576
 $12,574
 $11,976
 $10,872
 $45,998
 $10,576
 $12,574
 $11,976
 $10,872
 $45,998
 
Gross profit6,493
 7,755
 7,346
 6,515
 28,109
 6,493
 7,755
 7,346
 6,515
 28,109
 
Net income attributable to shareowners of
The Coca-Cola Company
1,619
 2,595
 2,114
 770
 7,098
 1,619
 2,595
 2,114
 770
 7,098
 
Basic net income per share$0.37
 $0.59
 $0.48
 $0.18
 $1.62
 $0.37
 $0.59
 $0.48
 $0.18
 $1.62
 
Diluted net income per share$0.36
 $0.58
 $0.48
 $0.17
 $1.60
1 
$0.36
 $0.58
 $0.48
 $0.17
 $1.60
1 
2013          
Net operating revenues$11,035
 $12,749
 $12,030
 $11,040
 $46,854
 
Gross profit6,711
 7,760
 7,237
 6,725
 28,433
 
Net income attributable to shareowners of
The Coca-Cola Company
1,751
 2,676
 2,447
 1,710
 8,584
 
Basic net income per share$0.39
 $0.60
 $0.55
 $0.39
 $1.94
1 
Diluted net income per share$0.39
 $0.59
 $0.54
 $0.38
 $1.90
 
1 
The sum of the quarterly net income per share amounts dodoes not agree to the full year net income per share amounts. We calculate net income per share based on the weighted-average number of outstanding shares during the reporting period. The average number of shares fluctuates throughout the year and can therefore produce a full year result that does not agree to the sum of the individual quarters.
Our first quarter, second quarter and third quarter reporting periods end on the Friday closest to the last day of the applicable quarterly calendar period. Our fourth quarter and fiscal year end on December 31 regardless of the day of the week on which December 31 falls.

The Company’sCompany's first quarter 2015 results were impacted by six additional shipping days compared to the first quarter of 2014. Furthermore, the Company recorded the following transactions which impacted results:
Charge of $320 million due to the early extinguishment of debt. Refer to Note 10 and Note 17.
Charges of $135 million due to the remeasurement of the net monetary assets of our local Venezuelan subsidiary into U.S. dollars using the SIMADI exchange rate, an impairment of a Venezuelan trademark and a write-down the Company recorded on receivables from our bottling partner in Venezuela. Refer to Note 1 and Note 17.
Charges of $125 million due to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 17 and Note 18.
Charges of $73 million due to the Company's proportionate share of unusual or infrequent items recorded by certain of our equity method investees. Refer to Note 17.
Charge of $21 million due to the refranchising of certain territories in North America. Refer to Note 2 and Note 17.
In the second quarter of 2015, the Company recorded the following transactions which impacted results:
Benefit of $1,402 million as a result of the Monster Transaction. Refer to Note 2 and Note 17.
Charge of $380 million due to an impairment primarily related to the discontinuation of the energy products in the glacéau portfolio as a result of the Monster Transaction. Refer to Note 2 and Note 17.
Charges of $186 million due to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 17 and Note 18.
Charge of $100 million as a result of a cash contribution to The Coca-Cola Foundation. Refer to Note 17.
Charge of $12 million due to the refranchising of certain territories in North America. Refer to Note 2 and Note 17.

146



In the third quarter of 2015, the Company recorded the following transactions which impacted results:
Charge of $794 million due to the refranchising of certain territories in North America. Refer to Note 2 and Note 17.
Charges of $216 million due to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 17 and Note 18.
Charge of $38 million related to an impairment on a trademark in the glacéau portfolio, primarily as a result of foreign currency exchange rate fluctuations that impacted the fair value of the asset. Refer to Note 2 and Note 17.
Charge of $3 million related to an impairment charge on a Venezuelan trademark. Refer to Note 1.
The Company's fourth quarter 2015 results were impacted by six fewer shipping days compared to the fourth quarter of 2014. Furthermore, the Company recorded the following transactions which impacted results:
Charges of $456 million due to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 17 and Note 18.
Charge of $179 million due to the refranchising of certain territories in North America. Refer to Note 2 and Note 17.
Benefit of $1 million as a result of the Monster Transaction. Refer to Note 2 and Note 17.
The Company's first quarter 2014 results were impacted by one less shipping day compared to the first quarter of 2013. Furthermore, the Company recorded the following transactions which impacted results:
Charges of $75$247 million for North America, $7due to the devaluation of the Venezuelan bolivar, including our proportionate share of the charge incurred by an equity method investee that has operations in Venezuela. Refer to Note 1 and Note 17.
Charges of $128 million for Asia Pacific, $42 million for Bottling Investments and $4 million for Corporate due to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 17 and Note 18.
Charges of $21 million for Bottling Investments and $226 million for Corporate due to the devaluation of the Venezuelan bolivar, including our proportionate share of the charge incurred by an equity method investee which has operations in Venezuela. Refer to Note 17 and Note 18.
Net charge of $6 million for Bottling Investments due to the Company’s proportionate share of unusual or infrequent items recorded by certain of our equity method investees. Refer to Note 17.
Net tax charge of $5 million related to amounts required to be recorded for changes to our uncertain tax positions, including interest and penalties. Refer to Note 14.
In the second quarter of 2014, the Company recorded the following transactions which impacted results:
Charges of $58$155 million for North America, $1 million for Asia Pacific, $66 million for Bottling Investments and $30 million for Corporate due to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 17 and Note 18.
Charge of $25$140 million for Bottling Investments as a resultdue to the refranchising of the restructuring and transition of the Company's Russian juice operations to an existing joint venture with an unconsolidated bottling partner.certain territories in North America. Refer to Note 2 and Note 17.
Charge of $21 million for Corporate as a result of a write-down of receivables related to sales of concentrate to our bottling partner in Venezuela due to limited government-approved exchange rate conversion mechanisms. Refer to Note 17.
Charge of $140 million for North America primarily due to the derecognition of intangible assets as a result of refranchising certain territories. Refer to Note 21 and Note 17.

139



Net charge of $6 million for Bottling Investments due to the Company’s proportionate share of unusual or infrequent items recorded by certain of our equity method investees. Refer to Note 17.
Net tax charge of $26 million related to amounts required to be recorded for changes to our uncertain tax positions, including interest and penalties. Refer to Note 14.
In the third quarter of 2014, the Company recorded the following transactions which impacted results:
Charge of $270 million due to the refranchising of certain territories in North America. Refer to Note 2 and Note 17.
Charges of $1$118 million for Eurasia and Africa, $2 million for Europe, $59 million for North America, $2 million for Asia Pacific, $34 million for Bottling Investments and $20 million for Corporate due to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 17 and Note 18.
Charge of $7 million for Bottling Investments as a result of the restructuring and transition of theThe Company's Russian juice operations to an existing joint venture with an unconsolidated bottling partner. Refer to Note 17.
Charge of $270 million for North America primarily due to the refranchising of certain territories. Refer to Note 2 and Note 17.
Net charge of $8 million for Bottling Investments due to the Company's proportionate share of unusual or infrequent items recorded by certain of our equity method investees. Refer to Note 17.
Net tax benefit of $29 million related to prior year audit settlements and amounts required to be recorded for changes to our uncertain tax positions, including interest and penalties. Refer to Note 14.
The Company’s fourth quarter 2014 results were impacted by one additional shipping day compared to the fourth quarter of 2013. Furthermore, the Company recorded the following transactions which impacted results:
Charges of $25$408 million for Eurasia and Africa, $109 million for Europe, $20 million for Latin America, $89 million for North America, $26 million for Asia Pacific, $69 million for Bottling Investments and $70 million for Corporate due to charges related to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 17 and Note 18.
Charge of $10 million for Bottling Investments as a result of the restructuring and transition of the Company's Russian juice operations to an existing joint venture with an unconsolidated bottling partner. Refer to Note 17.
Charge of $389 million for North America due to the refranchising of certain territories.territories in North America. Refer to Note 2 and Note 17.
Charge of $275 million due to the write-down of concentrate sales receivables from our bottling partner in Venezuela. Refer to Note 1 and Note 17.
Charge of $164 million for Corporate due to the remeasurement of the net monetary assets of our local Venezuelan subsidiary into U.S. dollars using the SICAD 2 exchange rate, and for the impairment of a Venezuelan trademark. Refer to Note 1 and Note 17.
Charge of $275 million for Latin America due to the write-down of concentrate sales receivables from our bottling partner in Venezuela. Refer to Note 1 and Note 17.
Benefit of $46 million for Bottling Investments due to the elimination of intercompany profits resulting from a write-down the Company recorded on the concentrate sales receivables from our bottling partner in Venezuela, an equity method investee. Refer to Note 1 and Note 17.
Charge of $32 million for Corporate as a result of a Brazilian bottling entity's majority interest owners exercising their option to acquire from us an additional equity interest at an exercise price less than that of our carrying value. Refer to Note 17.
Net tax charge of $5 million related to amounts required to be recorded for changes to our uncertain tax positions, including interest and penalties. Refer to Note 14.
The Company’s first quarter 2013 results were impacted by two fewer shipping days compared to the first quarter of 2012. Furthermore, the Company recorded the following transactions which impacted results:
Charges of $2 million for Eurasia and Africa, $82 million for North America, $8 million for Asia Pacific, $21 million for Bottling Investments and $10 million for Corporate due to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 17 and Note 18.
Charges of $9 million for Bottling Investments and $140 million for Corporate due to the devaluation of the Venezuelan bolivar, including our proportionate share of the charge incurred by an equity method investee that has operations in Venezuela. Refer to Note 1 and Note 17.

140147



Net charge of $30 million for Bottling Investments due to the Company’s proportionate share of unusual or infrequent items recorded by certain of our equity method investees. Refer to Note 17.
In the second quarter of 2013, the Company recorded the following transactions which impacted results:
Charges of $6 million for Europe, $55 million for North America, $6 million for Asia Pacific, $20 million for Bottling Investments and $46 million for Corporate due to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 17 and Note 18.
Charge of $144 million for Corporate due to a loss related to the then pending merger of four of the Company's Japanese bottling partners. Refer to Note 17.
Benefit of $139 million for Corporate due to a gain the Company recognized as a result of Coca-Cola FEMSA issuing additional shares of its own stock during the period at a per share amount greater than the carrying value of the Company's per share investment. Refer to Note 17.
Charge of $23 million for Corporate due to the early extinguishment of certain long-term debt. Refer to Note 10.
In the third quarter of 2013, the Company recorded the following transactions which impacted results:
Charges of $1 million for Europe, $53 million for North America, $2 million for Asia Pacific, $45 million for Bottling Investments and $41 million for Corporate due to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 17 and Note 18.
Charge of $190 million for Corporate due to impairment charges recorded on certain of the Company's intangible assets. Refer to Note 16 and Note 17.
Benefit of $615 million for Corporate due to a gain the Company recognized on the deconsolidation of our Brazilian bottling operations as a result of their combination with an independent bottling partner. Refer to Note 2 and Note 17.
Benefit of $30 million for Corporate due to a gain recognized on the merger of four of the Company's Japanese bottling partners in which we held equity method investments prior to their merger. Refer to Note 16 and Note 17.
Charge of $11 million for Asia Pacific due to certain of the Company's fixed assets. Refer to Note 7 and Note 17.
Net benefit of $8 million for Bottling Investments due to the Company's proportionate share of unusual or infrequent items recorded by certain of our equity method investees. Refer to Note 17.
Net tax benefit of $20 million related to amounts required to be recorded for changes to our uncertain tax positions, including interest and penalties. Refer to Note 14.
The Company’s fourth quarter 2013 results were impacted by one additional shipping day compared to the fourth quarter of 2012. Furthermore, the Company recorded the following transactions which impacted results:
Charges of $50 million for Europe, $92 million for North America, $10 million for Asia Pacific, $108 million for Bottling Investments and $24 million for Corporate due to charges related to the Company's productivity and reinvestment program as well as other restructuring initiatives. Refer to Note 17 and Note 18.
Charge of $5 million for Corporate due to impairment charges recorded on certain of the Company's intangible assets. Refer to Note 16 and Note 17.
Charge of $11 million for Asia Pacific due to charges associated with certain of the Company's fixed assets. Refer to Note 7 and Note 17.
Net charge of $134 million for Bottling Investments due to the Company's proportionate share of unusual or infrequent items recorded by certain of our equity method investees. Refer to Note 17.
Charge of $27 million for Corporate due to the early extinguishment of certain long-term debt. Refer to Note 10.
Net tax benefit of $15 million related to amounts required to be recorded for changes to our uncertain tax positions, including interest and penalties. Refer to Note 14.


141



ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
Not applicable.
ITEM 9A.  CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
The Company, under the supervision and with the participation of its management, including the Chief Executive Officer and the Chief Financial Officer, evaluated the effectiveness of the design and operation of the Company's "disclosure controls and procedures" (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange("Exchange Act")) as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that the Company's disclosure controls and procedures were effective as of December 31, 20142015.
Report of Management on Internal Control Over Financial Reporting and Attestation Report of Independent Registered Public Accounting Firm
The report of management on our internal control over financial reporting as of December 31, 20142015 and the attestation report of our independent registered public accounting firm on our internal control over financial reporting are set forth in Part II, "Item 8. Financial Statements and Supplementary Data" in this report.
Changes in Internal Control Over Financial Reporting
There have been no changes in the Company's internal control over financial reporting during the quarter ended December 31, 20142015 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.
ITEM 9B.  OTHER INFORMATION
Not applicable.
PART III
ITEM 10.  DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The information regarding Director Nominations under the subheading "Item 1-Election of Directors" under the principal heading "Governance," the information under the subheading "2015 Director Nominees" under the principal heading "Governance," the information regarding the Codes of Business Conduct under the subheading "Additional Governance Features" under the principal heading "Governance," the information under the subheading "Section 16(a) Beneficial Ownership Reporting Compliance" under the principal heading "Share Ownership" and the information regarding the Audit Committee under the subheading "Board and Committee Governance" under the principal heading "Governance" in the Company's 20152016 Proxy Statement is incorporated herein by reference. See Item X in Part I of this report for information regarding executive officers of the Company.
ITEM 11.  EXECUTIVE COMPENSATION
The information under the subheading "Director Compensation" under the principal heading "Governance" and the information under the subheadings "Compensation Discussion and Analysis," "Report of the Compensation Committee," "Compensation Committee Interlocks and Insider Participation," "Compensation Tables," "Payments on Termination or Change in Control" and "Summary of Plans" under the principal heading "Compensation" in the Company's 20152016 Proxy Statement is incorporated herein by reference.
ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The information under the subheading "Equity Compensation Plan Information" under the principal heading "Compensation" and the information under the subheading "Ownership of Equity Securities of the Company" under the principal heading "Share Ownership" in the Company's 20152016 Proxy Statement is incorporated herein by reference.


142148



ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The information under the subheading "Director Independence and Related Person Transactions" under the principal heading
"Governance" in the Company's 20152016 Proxy Statement is incorporated herein by reference.
ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information regarding Audit Fees, Audit-Related Fees, Tax Fees, All Other Fees and Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors under the subheading "Item 3 – Ratification of the Appointment of Ernst & Young LLP as Independent Auditors" under the principal heading "Audit Matters" in the Company's 20152016 Proxy Statement is incorporated herein by reference.
PART IV
ITEM 15.  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a)The following documents are filed as part of this report:
1.Financial Statements:
Consolidated Statements of Income — Years ended December 31, 20142015, 20132014 and 20122013.
Consolidated Statements of Comprehensive Income — Years ended December 31, 20142015, 20132014 and 20122013.
Consolidated Balance Sheets — December 31, 20142015 and 20132014.
Consolidated Statements of Cash Flows — Years ended December 31, 20142015, 20132014 and 20122013.
Consolidated Statements of Shareowners' Equity — Years ended December 31, 20142015, 20132014 and 20122013.
Notes to Consolidated Financial Statements.
Report of Independent Registered Public Accounting Firm.
Report of Independent Registered Public Accounting Firm on Internal Control Over Financial Reporting.
2.Financial Statement Schedules:
The schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission ("SEC") are not required under the related instructions or are inapplicable and, therefore, have been omitted.
3.Exhibits
In reviewing the agreements included as exhibits to this report, please remember they are included to provide you with information regarding their terms and are not intended to provide any other factual or disclosure information about the Company or the other parties to the agreements. The agreements contain representations, warranties, covenants and conditions by or of each of the parties to the applicable agreement. These representations, warranties, covenants and conditions have been made solely for the benefit of the other parties to the applicable agreement and:
should not in all instances be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate;
may have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement;
may apply standards of materiality in a way that is different from what may be viewed as material to you or other investors; and
were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and are subject to more recent developments.
Accordingly, these representations and warranties may not describe the actual state of affairs as of the date they were made or at any other time. Additional information about the Company may be found elsewhere in this report and the Company's other public filings, which are available without charge through the SEC's website at http://www.sec.gov.

143149



Exhibit No.
(With regard to applicable cross-references in the list of exhibits below, the Company's Current, Quarterly and Annual Reports are filed with the Securities and Exchange Commission (the "SEC"("SEC") under File No. 001-02217; and Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Current, Quarterly and Annual Reports are filed with the SEC under File No. 01-09300).
3.1 Certificate of Incorporation of the Company, including Amendment of Certificate of Incorporation, dated July 27, 2012 — incorporated herein by reference to Exhibit 3.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 28, 2012.
3.2 By-Laws of the Company, as amended and restated through April 25, 2013September 2, 2015 — incorporated herein by reference to Exhibit 3.1 of the Company's Current Report on Form 8-K filed on April 26, 2013.September 3, 2015.
4.1 As permitted by the rules of the SEC, the Company has not filed certain instruments defining the rights of holders of long-term debt of the Company or consolidated subsidiaries under which the total amount of securities authorized does not exceed 10 percent of the total assets of the Company and its consolidated subsidiaries. The Company agrees to furnish to the SEC, upon request, a copy of any omitted instrument.
4.2 Amended and Restated Indenture, dated as of April 26, 1988, between the Company and Deutsche Bank Trust Company Americas, as successor to Bankers Trust Company, as trustee — incorporated herein by reference to Exhibit 4.1 to the Company's Registration Statement on Form S-3 (Registration No. 33-50743) filed on October 25, 1993.
4.3 First Supplemental Indenture, dated as of February 24, 1992, to Amended and Restated Indenture, dated as of April 26, 1988, between the Company and Deutsche Bank Trust Company Americas, as successor to Bankers Trust Company, as trustee — incorporated herein by reference to Exhibit 4.2 to the Company's Registration Statement on Form S-3 (Registration No. 33-50743) filed on October 25, 1993.
4.4 Second Supplemental Indenture, dated as of November 1, 2007, to Amended and Restated Indenture, dated as of April 26, 1988, as amended, between the Company and Deutsche Bank Trust Company Americas, as successor to Bankers Trust Company, as trustee — incorporated herein by reference to Exhibit 4.3 to the Company's Current Report on Form 8-K filed on March 5, 2009.
4.5 Form of Note for 5.350% Notes due November 15, 2017 — incorporated herein by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K filed on October 31, 2007.
4.6 Form of Note for 4.875% Notes due March 15, 2019 — incorporated herein by reference to Exhibit 4.5 to the Company's Current Report on Form 8-K filed on March 5, 2009.
4.7 Form of Note for 1.500% Notes due November 15, 2015 — incorporated herein by reference to Exhibit 4.6 to the Company's Current Report on Form 8-K filed on November 18, 2010.
4.8Form of Note for 3.150% Notes due November 15, 2020 — incorporated herein by reference to Exhibit 4.7 to the Company's Current Report on Form 8-K filed on November 18, 2010.
4.94.8 Form of Exchange and Registration Rights Agreement among the Company, the representatives of the initial purchasers of the Notes and the other parties named therein — incorporated herein by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K filed on August 8, 2011.
4.104.9 Form of Note for 1.80% Notes due September 1, 2016 — incorporated herein by reference to Exhibit 4.13 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2011.
4.114.10 Form of Note for 3.30% Notes due September 1, 2021 — incorporated herein by reference to Exhibit 4.14 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2011.
4.12Form of Note for 0.750% Notes due March 13, 2015 — incorporated herein by reference to Exhibit 4.5 to the Company's Current Report on Form 8-K filed on March 14, 2012.
4.134.11 Form of Note for 1.650% Notes due March 14, 2018 — incorporated herein by reference to Exhibit 4.6 to the Company's Current Report on Form 8-K filed on March 14, 2012.
4.14Form of Note for Floating Rate Notes due 2015 — incorporated herein by reference to Exhibit 4.4 to the Company's Current Report on Form 8-K filed on March 5, 2013.
4.154.12 Form of Note for 1.150% Notes due 2018 — incorporated herein by reference to Exhibit 4.5 to the Company's Current Report on Form 8-K filed on March 5, 2013.
4.164.13 Form of Note for 2.500% Notes due 2023 — incorporated herein by reference to Exhibit 4.6 to the Company's Current Report on Form 8-K filed on March 5, 2013.
4.174.14 Form of Note for Floating Rate Notes due 2016 — incorporated herein by reference to Exhibit 4.4 to the Company's Current Report on Form 8-K filed on November 1, 2013.
4.184.15 Form of Note for 0.750% Notes due 2016 — incorporated herein by reference to Exhibit 4.5 to the Company's Current Report on Form 8-K filed on November 1, 2013.

144



4.194.16 Form of Note for 1.650% Notes due 2018 — incorporated herein by reference to Exhibit 4.6 to the Company's Current Report on Form 8-K filed on November 1, 2013.
4.204.17 Form of Note for 2.450% Notes due 2020 — incorporated herein by reference to Exhibit 4.7 to the Company's Current Report on Form 8-K filed on November 1, 2013.
4.214.18 Form of Note for 3.200% Notes due 2023 — incorporated herein by reference to Exhibit 4.8 to the Company's Current Report on Form 8-K filed on November 1, 2013.

150



4.22
4.19 Form of Note for Floating Rate Notes due 2015 — incorporated herein by reference to Exhibit 4.4 to the Company's Current Report on Form 8-K filed on March 7, 2014.
4.20Form of Note for 1.875% Notes due 2026 — incorporated herein by reference to Exhibit 4.4 to the Company's Current Report on Form 8-A filed on September 19, 2014.
4.21Form of Note for 1.125% Notes due 2022 — incorporated herein by reference to Exhibit 4.5 to the Company's Current Report on Form 8-A filed on September 19, 2014.
4.22Form of Note for Floating Rate Notes due 2017 — incorporated herein by reference to Exhibit 4.4 to the Company's Registration Statement on Form 8-A filed on March 6, 2015.
4.23 Form of Note for 1.124%Floating Rate Notes due 20222019 — incorporated herein by reference to Exhibit 4.5 to the Company's Registration Statement on Form 8-A filed on March 6, 2015.
4.24Form of Note for 0.75% Notes due 2023 — incorporated herein by reference to Exhibit 4.6 to the Company's Registration Statement on Form 8-A filed on March 6, 2015.
4.25Form of Note for 1.125% Notes due 2027 — incorporated herein by reference to Exhibit 4.7 to the Company's Registration Statement on Form 8-A filed on March 6, 2015.
4.26Form of Note for 1.625% Notes due 2035 — incorporated herein by reference to Exhibit 4.8 to the Company's Registration Statement on Form 8-A filed on March 6, 2015.
4.27Form of Note for 0.875% Notes due 2017 — incorporated herein by reference to Exhibit 4.4 to the Company's Current Report on Form 8-K filed on September 19, 2014.October 27, 2015.
4.244.28 Form of Note for 1.875% Notes due 20262020 — incorporated herein by reference to Exhibit 4.5 to the Company's Current Report on Form 8-K filed on September 19, 2014.October 27, 2015.
4.29Form of Note for 2.875% Notes due 2025 — incorporated herein by reference to Exhibit 4.6 to the Company's Current Report on Form 8-K filed on October 27, 2015.
10.1 Performance Incentive Plan of the Company, as amended and restated as of February 16, 2011 — incorporated herein by reference to Exhibit 10.7 to the Company's Current Report on Form 8-K filed on February 17, 2011.*
10.2 The Coca-Cola Company 1999 Stock Option Plan, as amended and restated through February 20, 2013 (the "1999 Stock Option Plan") — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on February 20, 2013.*
10.2.1 Form of Stock Option Agreement in connection with the 1999 Stock Option Plan — incorporated herein by reference to Exhibit 99.1 to the Company's Current Report on Form 8-K filed on February 14, 2007.*
10.2.2 Form of Stock Option Agreement in connection with the 1999 Stock Option Plan, as adopted December 12, 2007 — incorporated herein by reference to Exhibit 10.8 to the Company's Current Report on Form 8-K filed on February 21, 2008.*
10.2.3 Form of Stock Option Agreement in connection with the 1999 Stock Option Plan, as adopted February 18, 2009 — incorporated herein by reference to Exhibit 10.5 to the Company's Current Report on Form 8-K filed on February 18, 2009.*
10.3 The Coca-Cola Company 2002 Stock Option Plan, amended and restated through February 18, 2009 (the "2002 Stock Option Plan") — incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on February 18, 2009.*
10.3.1 Form of Stock Option Agreement in connection with the 2002 Stock Option Plan, as amended — incorporated herein by reference to Exhibit 99.1 to the Company's Current Report on Form 8-K filed on December 8, 2004.*
10.3.2 Form of Stock Option Agreement in connection with the 2002 Stock Option Plan, as adopted December 12, 2007 — incorporated herein by reference to Exhibit 10.9 to the Company's Current Report on Form 8-K filed on February 21, 2008.*
10.3.3 Form of Stock Option Agreement in connection with the 2002 Stock Option Plan, as adopted February 18, 2009 — incorporated herein by reference to Exhibit 10.6 to the Company's Current Report on Form 8-K filed on February 18, 2009.*
10.4 The Coca-Cola Company 2008 Stock Option Plan, as amended and restated, effective February 20, 2013 (the "2008 Stock Option Plan") — incorporated herein by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on February 20, 2013.*
10.4.1 Form of Stock Option Agreement for grants under the 2008 Stock Option Plan — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on July 16, 2008.*
10.4.2 Form of Stock Option Agreement for grants under the 2008 Stock Option Plan, as adopted February 18, 2009 — incorporated herein by reference to Exhibit 10.7 to the Company's Current Report on Form 8-K filed on February 18, 2009.*

151



10.4.3 Form of Stock Option Agreement for grants under the 2008 Stock Option Plan, as adopted February 19, 2014 —2014— incorporated herein by reference to Exhibit 10.4 to the Company's Current Report on Form 8-K filed on February 19, 2014.*
10.5 The Coca-Cola Company 1983 Restricted Stock Award Plan, as amended and restated through February 16, 2011 (the "1983 Restricted Stock Award Plan") — incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on February 17, 2011.*
10.6 The Coca-Cola Company 1989 Restricted Stock Award Plan, as amended and restated through February 19, 2014 (the "1989 Restricted Stock Award Plan") — incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on February 19, 2014.*

145



10.6.1 Form of Restricted Stock Agreement in connection with the 1989 Restricted Stock Award Plan, as adopted February 17, 2010 — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on February 18, 2010.*
10.6.2 Form of Restricted Stock Agreement (Performance Share Unit Agreement) in connection with the 1989 Restricted Stock Award Plan, as adopted February 17, 2010 — incorporated herein by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on February 18, 2010.*
10.6.3 Form of Restricted Stock Agreement (Performance Share Unit Agreement) for France in connection with the 1989 Restricted Stock Award Plan, as adopted February 17, 2010 — incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on February 18, 2010.*
10.6.4 Form of Restricted Stock Agreement (Performance Share Unit Agreement) in connection with the 1989 Restricted Stock Award Plan, as adopted February 16, 2011 — incorporated herein by reference to Exhibit 10.5 to the Company's Current Report on Form 8-K filed on February 17, 2011.*
10.6.5 Form of Restricted Stock Agreement (Performance Share Unit Agreement) for France in connection with the 1989 Restricted Stock Award Plan, as adopted February 16, 2011 — incorporated herein by reference to Exhibit 10.6 to the Company's Current Report on Form 8-K filed on February 17, 2011.*
10.6.6 Form of Restricted Stock Unit Agreement in connection with the 1989 Restricted Stock Award Plan, as adopted February 15, 2012 — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on February 15, 2012.*
10.6.7 Form of Restricted Stock Unit Agreement in connection with the 1989 Restricted Stock Award Plan, as adopted February 15, 2012 — incorporated herein by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on February 15, 2012.*
10.6.8 Form of Restricted Stock Unit Agreement in connection with the 1989 Restricted Stock Award Plan, as adopted February 15, 2012 — incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on February 15, 2012.*
10.6.9 Form of Restricted Stock Unit Agreement in connection with the 1989 Restricted Stock Award Plan, as adopted February 15, 2012 — incorporated herein by reference to Exhibit 10.4 to the Company's Current Report on Form 8-K filed on February 15, 2012.*
10.6.10 Form of Restricted Stock Agreement (Performance Share Unit Agreement) in connection with the 1989 Restricted Stock Award Plan, as adopted February 15, 2012 — incorporated herein by reference to Exhibit 10.5 to the Company's Current Report on Form 8-K filed on February 15, 2012.*
10.6.11 Form of Restricted Stock Agreement (Performance Share Unit Agreement) for France in connection with the 1989 Restricted Stock Award Plan, as adopted February 15, 2012 — incorporated herein by reference to Exhibit 10.6 to the Company's Current Report on Form 8-K filed on February 15, 2012.*
10.6.12 Form of Restricted Stock Agreement (Performance Share Unit Agreement) in connection with the 1989 Restricted Stock Award Plan, as adopted February 20, 2013 — incorporated herein by reference to Exhibit 10.4 to the Company's Current Report on Form 8-K filed on February 20, 2013.*
10.6.13 Form of Restricted Stock Agreement (Performance Share Unit Agreement) in connection with the 1989 Restricted Stock Award Plan, as adopted February 20, 2013 — incorporated herein by reference to Exhibit 10.5 to the Company's Current Report on Form 8-K filed on February 20, 2013.*
10.6.14 Form of Restricted Stock Unit Agreement in connection with the 1989 Restricted Stock Award Plan, as adopted February 20, 2013 — incorporated herein by reference to Exhibit 10.6 to the Company's Current Report on Form 8-K filed on February 20, 2013.*
10.6.15 Form of Restricted Stock Unit Agreement in connection with the 1989 Restricted Stock Award Plan, as adopted February 20, 2013 — incorporated herein by reference to Exhibit 10.7 to the Company's Current Report on Form 8-K filed on February 20, 2013.*
10.6.16 Form of Restricted Stock Agreement (Performance Share Unit Agreement) in connection with the 1989 Restricted Stock Award Plan, as adopted February 19, 2014 — incorporated herein by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on February 19, 2014.*

152



10.6.17 Form of Restricted Stock Unit Agreement in connection with the 1989 Restricted Stock Award Plan, as adopted February 19, 2014 — incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on February 19, 2014.*
10.7 The Coca-Cola Company 2014 Equity Plan (the "2014 Equity Plan") — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on April 23, 2014.*
10.7.1Form of Performance Share Agreement for grants under the 2014 Equity Plan, as adopted February 18, 2015 — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on February 18, 2015.*
10.7.2Form of Performance Share Agreement alternate for grants under the 2014 Equity Plan, as adopted February 18, 2015 — incorporated herein by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on February 18, 2015.*
10.7.3Form of Stock Option Agreement for grants under the 2014 Equity Plan, as adopted February 18, 2015 — incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on February 18, 2015.*
10.7.4Form of Restricted Stock Unit Agreement for grants under the 2014 Equity Plan, as adopted February 18, 2015 — incorporated herein by reference to Exhibit 10.4 to the Company's Current Report on Form 8-K filed on February 18, 2015.*
10.8 The Coca-Cola Company Compensation Deferral & Investment Program of the Company, as amended (the "Compensation Deferral & Investment Program"), including Amendment Number Four, dated November 28, 1995 — incorporated herein by reference to Exhibit 10.13 to the Company's Annual Report on Form 10-K for the year ended December 31, 1995.*

146



10.8.1 Amendment Number Five to the Compensation Deferral & Investment Program, effective as of January 1, 1998 — incorporated herein by reference to Exhibit 10.8.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 1997.*
10.8.2 Amendment Number Six to the Compensation Deferral & Investment Program, dated as of January 12, 2004, effective January 1, 2004 — incorporated herein by reference to Exhibit 10.9.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 2003.*
10.9 The Coca-Cola Company Supplemental Pension Plan, Amended and Restated Effectiveeffective January 1, 2010 (the "Supplemental Pension Plan") — incorporated herein by reference to Exhibit 10.10.6 to the Company's Annual Report on Form 10-K for the year ended December 31, 2009.*
10.9.1 Amendment One to the Supplemental Pension Plan, effective December 31, 2012, dated December 6, 2012 — incorporated herein by reference to Exhibit 10.10.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.*
10.9.2 Amendment Two to the Supplemental Pension Plan, effective April 1, 2013, dated March 19, 2013 — incorporated herein by reference to Exhibit 10.10 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 29, 2013.*
10.10 The Coca-Cola Company Supplemental 401(k) Plan (f/k/a the Supplemental Thrift Plan of the Company), Amended and Restated Effective January 1, 2012, dated December 14, 2011 — incorporated herein by reference to Exhibit 10.11 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.*
10.11 The Coca-Cola Company Supplemental Cash Balance Plan, effective January 1, 2012 (the "Supplemental Cash Balance Plan") — incorporated herein by reference to Exhibit 10.12 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.*
10.11.1 Amendment One to the Supplemental Cash Balance Plan, dated December 6, 2012 — incorporated herein by reference to Exhibit 10.12.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.*
10.11.2Amendment Two to the Supplemental Cash Balance Plan, dated June 15, 2015 — incorporated herein by reference to Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q for the quarter ended July 3, 2015.*
10.12 The Coca-Cola Company Directors' Plan, amended and restated on December 13, 2012, effective January 1, 2013 — incorporated herein by reference to Exhibit 10.13 to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.*
10.13 Deferred Compensation Plan of the Company, as amended and restated December 8, 2010 — incorporated herein by reference to Exhibit 10.16 to the Company's Annual Report on Form 10-K for the year ended December 31, 2010.*
10.14 The Coca-Cola Export Corporation Employee Share Plan, effective as of March 13, 2002 — incorporated herein by reference to Exhibit 10.31 to the Company's Annual Report on Form 10-K for the year ended December 31, 2002.*

153



10.15 The Coca-Cola Company Benefits Plan for Members of the Board of Directors, as amended and restated through April 14, 2004 (the "Benefits Plan for Members of the Board of Directors") — incorporated herein by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2004.*
10.15.1 Amendment Number One to the Benefits Plan for Members of the Board of Directors, dated December 16, 2005 — incorporated herein by reference to Exhibit 10.31.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2005.*
10.16 Employment Agreement, dated as of February 20, 2003, between the Company and José Octavio Reyes — incorporated herein by reference to Exhibit 10.43 to the Company's Annual Report on Form 10-K for the year ended December 31, 2004.*
10.16.1Letter, dated September 13, 2012, between Servicios Integrados de Administración y Alta Gerencia, S de R.L. de C.V. and José Octavio Reyes — incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on September 14, 2012.*
10.16.2Modification of Conditions, Termination Agreement and Release, dated September 13, 2012, between Servicios Integrados de Administración y Alta Gerencia, S de R.L. de C.V. and José Octavio Reyes — incorporated herein by reference to Exhibit 10.4 to the Company's Current Report on Form 8-K filed on September 14, 2012.*
10.17The Coca-Cola Company Severance Pay Plan, As Amended and Restated, Effective January 1, 2012, dated December 14, 2011 — incorporated herein by reference to Exhibit 10.22 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.*
10.1810.17 Order Instituting Cease-and-Desist Proceedings, Making Findings and Imposing a Cease-and-Desist Order Pursuant to Section 8A of the Securities Act of 1933 and Section 21C of the Securities Exchange Act of 1934 — incorporated herein by reference to Exhibit 99.299.3 to the Company's Current Report on Form 8-K filed on April 18, 2005.

147



10.1910.18 Offer of Settlement of The Coca-Cola Company — incorporated herein by reference to Exhibit 99.2 to the Company's Current Report on Form 8-K filed on April 18, 2005.
10.2010.19 Share Purchase Agreement among Coca-Cola South Asia Holdings, Inc. and San Miguel Corporation, San Miguel Beverages (L) Pte Limited and San Miguel Holdings Limited in connection with the Company's purchase of Coca-Cola Bottlers Philippines, Inc., dated December 23, 2006 — incorporated herein by reference to Exhibit 99.1 to the Company's Current Report on Form 8-K filed on December 29, 2006.
10.2110.20 Cooperation Agreement between Coca-Cola South Asia Holdings, Inc. and San Miguel Corporation in connection with the Company's purchase of Coca-Cola Bottlers Philippines, Inc., dated December 23, 2006 — incorporated herein by reference to Exhibit 99.2 to the Company's Current Report on Form 8-K filed on December 29, 2006.
10.2210.21 Offer Letter, dated July 20, 2007, from the Company to Joseph V. Tripodi, including Agreement on Confidentiality, Non-Competition and Non-Solicitation, dated July 20, 2007 — incorporated herein by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 28, 2007.*
10.22.110.21.1 Agreement between the Company and Joseph V. Tripodi, dated December 15, 2008 — incorporated herein by reference to Exhibit 10.47.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2008.*
10.22.210.21.2 Separation Agreement and Full and Complete Release and Agreement on Competition, Trade Secrets and Confidentiality between The Coca-Cola Company and Joseph V. Tripodi, dated December 5, 2014.*
10.2310.22 Letter, dated July 17, 2008, to Muhtar Kent — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on July 21, 2008.*
10.2410.23 Letter of Understanding between the Company and Ceree Eberly, dated October 26, 2009, including Agreement on Confidentiality, Non-Competition and Non-Solicitation, dated November 1, 2009 — incorporated herein by reference to Exhibit 10.47 to the Company's Annual Report on Form 10-K for the year ended December 31, 2009.*
10.2510.24 The Coca-Cola Export Corporation Overseas Retirement Plan, as amended and restated, effective October 1, 2007 — incorporated herein by reference to Exhibit 10.55 to the Company's Annual Report on Form 10-K for the year ended December 31, 2008.*
10.25.110.24.1 Amendment Number One to The Coca-Cola Export Corporation Overseas Retirement Plan, as Amended and Restated, Effective October 1, 2007, dated September 29, 2011 — incorporated herein by reference to Exhibit 10.34.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.*
10.25.210.24.2 Amendment Number Two to The Coca-Cola Export Corporation Overseas Retirement Plan, as Amended and Restated, Effective October 1, 2007, dated November 14, 2011 — incorporated herein by reference to Exhibit 10.34.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.*
10.25.310.24.3 Amendment Number Three to The Coca-Cola Export Corporation Overseas Retirement Plan, as Amended and Restated, Effective October 1, 2007, dated September 27, 2012 — incorporated herein by reference to Exhibit 10.11 to the Company's Quarterly Report on Form 10-Q filed on September 28, 2012.*
10.2610.25 The Coca-Cola Export Corporation International Thrift Plan, as Amended and Restated, Effective January 1, 2011 — incorporated herein by reference to Exhibit 10.8 to the Company's Quarterly Report on Form 10-Q for the quarter ended April 1, 2011.*
10.26.110.25.1 Amendment Number One to The Coca-Cola Export Corporation International Thrift Plan, as Amended and Restated, Effective January 1, 2011, dated September 20, 2011 — incorporated herein by reference to Exhibit 10.35.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.* 

154



10.26.2
10.25.2 Amendment Number Two to The Coca-Cola Export Corporation International Thrift Plan, as Amended and Restated, Effective January 1, 2011, dated September 27, 2012 — incorporated herein by reference to Exhibit 10.10 to the Company's Quarterly Report on Form 10-Q filed on September 28, 2012.*
10.26The Coca-Cola Export Corporation Mobile Employees Retirement Plan, effective January 1, 2012.*
10.27 Letter Agreement, dated as of June 7, 2010, between The Coca-Cola Company and Dr Pepper Seven-Up, Inc. — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on June 7, 2010.
10.28 Coca-Cola Enterprises Inc. 2001 Stock Option Plan — incorporated herein by reference to Exhibit 99.4 to the Company's Registration Statement on Form S-8 (Registration No. 333-169722) filed on October 1, 2010.*
10.29 Coca-Cola Enterprises Inc. 2004 Stock Award Plan — incorporated herein by reference to Exhibit 99.5 to the Company's Registration Statement on Form S-8 (Registration No. 333-169722) filed on October 1, 2010.*
10.30 Coca-Cola Enterprises Inc. 2007 Incentive Award Plan — incorporated herein by reference to Exhibit 99.6 to the Company's Registration Statement on Form S-8 (Registration No. 333-169722) filed on October 1, 2010.*

148



10.30.1 Form of 2007 Stock Option Agreement (Senior Officers) under the Coca-Cola Enterprises Inc. 2007 Incentive Award Plan — incorporated herein by reference to Exhibit 10.32 to Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Annual Report on Form 10-K for the year ended December 31, 2007.*
10.30.2 Form of Stock Option Agreement (Chief Executive Officer and Senior Officers) under the Coca-Cola Enterprises Inc. 2007 Incentive Award Plan for Awards after October 29, 2008 — incorporated herein by reference to Exhibit 10.16.4 to Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Annual Report on Form 10-K for the year ended December 31, 2008.*
10.30.3 Form of 2007 Restricted Stock Unit Agreement (Senior Officers) under the Coca-Cola Enterprises Inc. 2007 Incentive Award Plan — incorporated herein by reference to Exhibit 10.16.7 to Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Annual Report on Form 10-K for the year ended December 31, 2008.*
10.30.4 Form of 2007 Performance Share Unit Agreement (Senior Officers) under the Coca-Cola Enterprises Inc. 2007 Incentive Award Plan — incorporated herein by reference to Exhibit 10.16.10 to Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Annual Report on Form 10-K for the year ended December 31, 2008.*
10.30.5 Form of Performance Share Unit Agreement (Chief Executive Officer and Senior Officers) under the Coca-Cola Enterprises Inc. 2007 Incentive Award Plan for Awards after October 29, 2008 — incorporated herein by reference to Exhibit 10.16.12 to Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Annual Report on Form 10-K for the year ended December 31, 2008.*
10.31 Coca-Cola Refreshments USA, Inc. Supplemental Matched Employee Savings and Investment Plan (Amended and Restated Effective January 1, 2010) — incorporated herein by reference to Exhibit 10.2 to Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Annual Report on Form 10-K for the year ended December 31, 2009.*
10.31.1 First Amendment to the Coca-Cola Refreshments USA, Inc. Supplemental Matched Employee Savings and Investment Plan (Amended and Restated Effective January 1, 2010), dated September 24, 2010 — incorporated herein by reference to Exhibit 10.45.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2010.*
10.31.2 Second Amendment to the Coca-Cola Refreshments USA, Inc. Supplemental Matched Employee Savings and Investment Plan (Amended and Restated Effective January 1, 2010), dated November 3, 2010 — incorporated herein by reference to Exhibit 10.45.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 2010.*
10.31.3 Third Amendment to the Coca-Cola Refreshments USA, Inc. Supplemental Matched Employee Savings and Investment Plan, Effective January 1, 2010, dated February 15, 2011 — incorporated herein by reference to Exhibit 10.45.4 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.*
10.31.4 Fourth Amendment to the Coca-Cola Refreshments USA, Inc. Supplemental Matched Employee Savings and Investment Plan, effective December 31, 2011, dated December 14, 2011 — incorporated herein by reference to Exhibit 10.45.5 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.*
10.32 Coca-Cola Refreshments Executive Pension Plan, dated December 13, 2010 (Amended and Restated, Effective January 1, 2011) — incorporated herein by reference to Exhibit 10.46 to the Company's Annual Report on Form 10-K for the year ended December 31, 2010.*
10.32.1 Amendment Number One to the Coca-Cola Refreshments Executive Pension Plan (Amended and Restated, Effective January 1, 2011), dated as of July 14, 2011—2011 — incorporated herein by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2011.*

155



10.32.2Amendment Number Two to the Coca-Cola Refreshments Executive Pension Plan, effective December 31, 2011, dated December 14, 2011 — incorporated herein by reference to Exhibit 10.46.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.*
10.33Amendment to certain Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Employee Benefit Plans and Equity Plans, effective December 6, 2010 — incorporated herein by reference to Exhibit 10.49 to the Company's Annual Report on Form 10-K for the year ended December 31, 2010.*
10.34Letter, dated September 11, 2012, from the Company to Ahmet Bozer — incorporated herein by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on September 14, 2012.*
10.34.1Separation Agreement and Full and Complete Release and Agreement on Competition, Trade Secrets and Confidentiality between The Coca-Cola Company and Ahmet Bozer, dated August 12, 2015 — incorporated herein by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on August 13, 2015.*
10.35Letter, dated September 11, 2012, from the Company to Brian Smith — incorporated herein by reference to Exhibit 10.5 to the Company's Current Report on Form 8-K filed on September 14, 2012.*
10.36Letter, dated September 11, 2012, from the Company to J. Alexander Douglas, Jr. — incorporated herein by reference to Exhibit 10.6 to the Company's Current Report on Form 8-K filed on September 14, 2012.*
10.37Letter, dated September 11, 2012, from the Company to Nathan Kalumbu — incorporated herein by reference to Exhibit 10.8 to the Company's Current Report on Form 8-K filed on September 14, 2012.*
10.38Coca-Cola Refreshments Supplemental Pension Plan (Amended and Restated Effective January 1, 2011), dated December 13, 2010 — incorporated herein by reference to Exhibit 10.7 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 30, 2012.*
10.38.1Amendment Number One to the Coca-Cola Refreshments Supplemental Pension Plan, dated December 14, 2011 — incorporated herein by reference to Exhibit 10.8 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 30, 2012.*
10.38.2Amendment Two to the Coca-Cola Refreshments Supplemental Pension Plan, dated December 6, 2012 — incorporated herein by reference to Exhibit 10.59.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.*
10.38.3Amendment Three to the Coca-Cola Refreshments Supplemental Pension Plan, adopted March 19, 2013 — incorporated herein by reference to Exhibit 10.8 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 29, 2013.*
10.38.4Amendment Four to the Coca-Cola Refreshments Supplemental Pension Plan, dated June 15, 2015 — incorporated herein by reference to Exhibit 10.5 to the Company's Quarterly Report on Form 10-Q for the quarter ended July 3, 2015.*
10.39Coca-Cola Refreshments Severance Pay Plan for Exempt Employees, effective as of January 1, 2012 — incorporated herein by reference to Exhibit 10.60.1 to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.*
10.39.1Amendment One to the Coca-Cola Refreshments Severance Pay Plan for Exempt Employees, effective January 1, 2012, dated May 24, 2012 — incorporated herein by reference to Exhibit 10.60.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.*
10.39.2Amendment Two to the Coca-Cola Refreshments Severance Pay Plan for Exempt Employees, dated December 6, 2012 — incorporated herein by reference to Exhibit 10.60.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.*
10.39.3Amendment Three to the Coca-Cola Refreshments Severance Pay Plan for Exempt Employees, adopted March 19, 2013 — incorporated herein by reference to Exhibit 10.9 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 29, 2013.*
10.40Letter, dated December 16, 2013, from the Company to Irial Finan — incorporated herein by reference to Exhibit 10.46 to the Company's Annual Report on Form 10-K for the year ended December 31, 2013.*
10.40.1Letter, dated April 29, 2015, from the Company to Irial Finan — incorporated herein by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q filed on July 29, 2015.*
10.41Letter, dated April 24, 2014, from the Company to Kathy N. Waller — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on April 25, 2014.*
10.42Letter, dated October 15, 2014, from the Company to Atul Singh — incorporated herein by reference to Exhibit 10.46 to the Company's Annual Report on Form 10-K for the year ended December 31, 2014.*
10.43Letter, dated December 16, 2014, from the Company to Marcos de Quinto — incorporated herein by reference to Exhibit 10.47 to the Company's Annual Report on Form 10-K for the year ended December 31, 2014.*

156



10.44Letter, dated February 12, 2015, from the Company to Ed Hays — incorporated herein by reference to Exhibit 10.5 to the Company's Quarterly Report on Form 10-Q filed on April 30, 2015.*
10.45Letter, dated April 29, 2015, from the Company to Julie Hamilton — incorporated herein by reference to Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q filed on July 29, 2015.*
10.46Letter, dated August 12, 2015, from the Company to James Quincey — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on August 13, 2015.*
10.47Separation Agreement and Full and Complete Release and Agreement on Competition, Trade Secrets and Confidentiality between The Coca-Cola Company and Alex Cummings, dated December 23, 2015.*
10.48Letter, dated October 14, 2015, from the Company to Bernhard Goepelt.*
12.1Computation of Ratios of Earnings to Fixed Charges for the years ended December 31, 2015, 2014, 2013, 2012 and 2011.
21.1List of subsidiaries of the Company as of December 31, 2015.
23.1Consent of Independent Registered Public Accounting Firm.
24.1Powers of Attorney of Officers and Directors signing this report.
31.1Rule 13a-14(a)/15d-14(a) Certification, executed by Muhtar Kent, Chairman of the Board of Directors and Chief Executive Officer of The Coca-Cola Company.
31.2Rule 13a-14(a)/15d-14(a) Certification, executed by Kathy N. Waller, Executive Vice President and Chief Financial Officer of The Coca-Cola Company.
32.1Certifications required by Rule 13a-14(b) or Rule 15d-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350), executed by Muhtar Kent, Chairman of the Board of Directors and Chief Executive Officer of The Coca-Cola Company and by Kathy N. Waller, Executive Vice President and Chief Financial Officer of The Coca-Cola Company.
101
The following financial information from The Coca-Cola Company's Annual Report on Form 10-K for the year ended December 31, 2015, formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Statements of Income for the years ended December 31, 2015, 2014 and 2013, (ii) Consolidated Statements of Comprehensive Income for the years ended December 31, 2015, 2014 and 2013, (iii) Consolidated Balance Sheets as of December 31, 2015 and 2014, (iv) Consolidated Statements of Cash Flows for the years ended December 31, 2015, 2014 and 2013, (v) Consolidated Statements of Shareowners' Equity for the years ended December 31, 2015, 2014 and 2013 and (vi) the Notes to Consolidated Financial Statements.



*
Management contracts and compensatory plans and arrangements required to be filed as exhibits pursuant to Item 15(b) of Form 10-K.

157



SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
THE COCA-COLA COMPANY
(Registrant)
By:/s/ MUHTAR KENT
Muhtar Kent
Chairman of the Board of Directors
and Chief Executive Officer
Date:February 25, 2016

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
/s/ MUHTAR KENT/s/ KATHY N. WALLER
Muhtar Kent
Chairman of the Board of Directors,
Chief Executive Officer and a Director
(Principal Executive Officer)
Kathy N. Waller
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
February 25, 2016February 25, 2016
/s/ LARRY M. MARK/s/ MARK RANDAZZA
Larry M. Mark
Vice President and Controller
(As Principal Accounting Officer)
Mark Randazza
Vice President and Assistant Controller
(On behalf of the Registrant)
February 25, 2016February 25, 2016
**
Herbert A. Allen
Director
Howard G. Buffett
Director
February 25, 2016February 25, 2016
**
Ronald W. Allen
Director
Richard M. Daley
Director
February 25, 2016February 25, 2016
**
Marc Bolland
Director
Barry Diller
Director
February 25, 2016February 25, 2016
**
Ana Botín
Director
Helene D. Gayle
Director
February 25, 2016February 25, 2016

158



**
Evan G. Greenberg
Director
Maria Elena Lagomasino
Director
February 25, 2016February 25, 2016
**
Alexis M. Herman
Director
Sam Nunn
Director
February 25, 2016February 25, 2016
**
Robert A. Kotick
Director
David B. Weinberg
Director
February 25, 2016February 25, 2016


*By:/s/ GLORIA K. BOWDEN
Gloria K. Bowden
Attorney-in-fact
February 25, 2016

159



EXHIBIT INDEX
Exhibit No.
(With regard to applicable cross-references in the list of exhibits below, the Company's Current, Quarterly and Annual Reports are filed with the Securities and Exchange Commission ("SEC") under File No. 001-02217; and Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Current, Quarterly and Annual Reports are filed with the SEC under File No. 01-09300).
3.1Certificate of Incorporation of the Company, including Amendment of Certificate of Incorporation, dated July 27, 2012 — incorporated herein by reference to Exhibit 3.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 28, 2012.
3.2By-Laws of the Company, as amended and restated through September 2, 2015 — incorporated herein by reference to Exhibit 3.1 of the Company's Current Report on Form 8-K filed on September 3, 2015.
4.1As permitted by the rules of the SEC, the Company has not filed certain instruments defining the rights of holders of long-term debt of the Company or consolidated subsidiaries under which the total amount of securities authorized does not exceed 10 percent of the total assets of the Company and its consolidated subsidiaries. The Company agrees to furnish to the SEC, upon request, a copy of any omitted instrument.
4.2Amended and Restated Indenture, dated as of April 26, 1988, between the Company and Deutsche Bank Trust Company Americas, as successor to Bankers Trust Company, as trustee — incorporated herein by reference to Exhibit 4.1 to the Company's Registration Statement on Form S-3 (Registration No. 33-50743) filed on October 25, 1993.
4.3First Supplemental Indenture, dated as of February 24, 1992, to Amended and Restated Indenture, dated as of April 26, 1988, between the Company and Deutsche Bank Trust Company Americas, as successor to Bankers Trust Company, as trustee — incorporated herein by reference to Exhibit 4.2 to the Company's Registration Statement on Form S-3 (Registration No. 33-50743) filed on October 25, 1993.
4.4Second Supplemental Indenture, dated as of November 1, 2007, to Amended and Restated Indenture, dated as of April 26, 1988, as amended, between the Company and Deutsche Bank Trust Company Americas, as successor to Bankers Trust Company, as trustee — incorporated herein by reference to Exhibit 4.3 to the Company's Current Report on Form 8-K filed on March 5, 2009.
4.5Form of Note for 5.350% Notes due November 15, 2017 — incorporated herein by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K filed on October 31, 2007.
4.6Form of Note for 4.875% Notes due March 15, 2019 — incorporated herein by reference to Exhibit 4.5 to the Company's Current Report on Form 8-K filed on March 5, 2009.
4.7Form of Note for 3.150% Notes due November 15, 2020 — incorporated herein by reference to Exhibit 4.7 to the Company's Current Report on Form 8-K filed on November 18, 2010.
4.8Form of Exchange and Registration Rights Agreement among the Company, the representatives of the initial purchasers of the Notes and the other parties named therein — incorporated herein by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K filed on August 8, 2011.
4.9Form of Note for 1.80% Notes due September 1, 2016 — incorporated herein by reference to Exhibit 4.13 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2011.
4.10Form of Note for 3.30% Notes due September 1, 2021 — incorporated herein by reference to Exhibit 4.14 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2011.
4.11Form of Note for 1.650% Notes due March 14, 2018 — incorporated herein by reference to Exhibit 4.6 to the Company's Current Report on Form 8-K filed on March 14, 2012.
4.12Form of Note for 1.150% Notes due 2018 — incorporated herein by reference to Exhibit 4.5 to the Company's Current Report on Form 8-K filed on March 5, 2013.
4.13Form of Note for 2.500% Notes due 2023 — incorporated herein by reference to Exhibit 4.6 to the Company's Current Report on Form 8-K filed on March 5, 2013.
4.14Form of Note for Floating Rate Notes due 2016 — incorporated herein by reference to Exhibit 4.4 to the Company's Current Report on Form 8-K filed on November 1, 2013.
4.15Form of Note for 0.750% Notes due 2016 — incorporated herein by reference to Exhibit 4.5 to the Company's Current Report on Form 8-K filed on November 1, 2013.
4.16Form of Note for 1.650% Notes due 2018 — incorporated herein by reference to Exhibit 4.6 to the Company's Current Report on Form 8-K filed on November 1, 2013.
4.17Form of Note for 2.450% Notes due 2020 — incorporated herein by reference to Exhibit 4.7 to the Company's Current Report on Form 8-K filed on November 1, 2013.
4.18Form of Note for 3.200% Notes due 2023 — incorporated herein by reference to Exhibit 4.8 to the Company's Current Report on Form 8-K filed on November 1, 2013.

160



4.19Form of Note for Floating Rate Notes due 2015 — incorporated herein by reference to Exhibit 4.4 to the Company's Current Report on Form 8-K filed on March 7, 2014.
4.20Form of Note for 1.875% Notes due 2026 — incorporated herein by reference to Exhibit 4.4 to the Company's Current Report on Form 8-A filed on September 19, 2014.
4.21Form of Note for 1.125% Notes due 2022 — incorporated herein by reference to Exhibit 4.5 to the Company's Current Report on Form 8-A filed on September 19, 2014.
4.22Form of Note for Floating Rate Notes due 2017 — incorporated herein by reference to Exhibit 4.4 to the Company's Registration Statement on Form 8-A filed on March 6, 2015.
4.23Form of Note for Floating Rate Notes due 2019 — incorporated herein by reference to Exhibit 4.5 to the Company's Registration Statement on Form 8-A filed on March 6, 2015.
4.24Form of Note for 0.75% Notes due 2023 — incorporated herein by reference to Exhibit 4.6 to the Company's Registration Statement on Form 8-A filed on March 6, 2015.
4.25Form of Note for 1.125% Notes due 2027 — incorporated herein by reference to Exhibit 4.7 to the Company's Registration Statement on Form 8-A filed on March 6, 2015.
4.26Form of Note for 1.625% Notes due 2035 — incorporated herein by reference to Exhibit 4.8 to the Company's Registration Statement on Form 8-A filed on March 6, 2015.
4.27Form of Note for 0.875% Notes due 2017 — incorporated herein by reference to Exhibit 4.4 to the Company's Current Report on Form 8-K filed on October 27, 2015.
4.28Form of Note for 1.875% Notes due 2020 — incorporated herein by reference to Exhibit 4.5 to the Company's Current Report on Form 8-K filed on October 27, 2015.
4.29Form of Note for 2.875% Notes due 2025 — incorporated herein by reference to Exhibit 4.6 to the Company's Current Report on Form 8-K filed on October 27, 2015.
10.1Performance Incentive Plan of the Company, as amended and restated as of February 16, 2011 — incorporated herein by reference to Exhibit 10.7 to the Company's Current Report on Form 8-K filed on February 17, 2011.*
10.2The Coca-Cola Company 1999 Stock Option Plan, as amended and restated through February 20, 2013 (the "1999 Stock Option Plan") — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on February 20, 2013.*
10.2.1Form of Stock Option Agreement in connection with the 1999 Stock Option Plan — incorporated herein by reference to Exhibit 99.1 to the Company's Current Report on Form 8-K filed on February 14, 2007.*
10.2.2Form of Stock Option Agreement in connection with the 1999 Stock Option Plan, as adopted December 12, 2007 — incorporated herein by reference to Exhibit 10.8 to the Company's Current Report on Form 8-K filed on February 21, 2008.*
10.2.3Form of Stock Option Agreement in connection with the 1999 Stock Option Plan, as adopted February 18, 2009 — incorporated herein by reference to Exhibit 10.5 to the Company's Current Report on Form 8-K filed on February 18, 2009.*
10.3The Coca-Cola Company 2002 Stock Option Plan, amended and restated through February 18, 2009 (the "2002 Stock Option Plan") — incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on February 18, 2009.*
10.3.1Form of Stock Option Agreement in connection with the 2002 Stock Option Plan, as amended — incorporated herein by reference to Exhibit 99.1 to the Company's Current Report on Form 8-K filed on December 8, 2004.*
10.3.2Form of Stock Option Agreement in connection with the 2002 Stock Option Plan, as adopted December 12, 2007 — incorporated herein by reference to Exhibit 10.9 to the Company's Current Report on Form 8-K filed on February 21, 2008.*
10.3.3Form of Stock Option Agreement in connection with the 2002 Stock Option Plan, as adopted February 18, 2009 — incorporated herein by reference to Exhibit 10.6 to the Company's Current Report on Form 8-K filed on February 18, 2009.*
10.4The Coca-Cola Company 2008 Stock Option Plan, as amended and restated, effective February 20, 2013 (the "2008 Stock Option Plan") — incorporated herein by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on February 20, 2013.*
10.4.1Form of Stock Option Agreement for grants under the 2008 Stock Option Plan — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on July 16, 2008.*
10.4.2Form of Stock Option Agreement for grants under the 2008 Stock Option Plan, as adopted February 18, 2009 — incorporated herein by reference to Exhibit 10.7 to the Company's Current Report on Form 8-K filed on February 18, 2009.*

161



10.4.3Form of Stock Option Agreement for grants under the 2008 Stock Option Plan, as adopted February 19, 2014— incorporated herein by reference to Exhibit 10.4 to the Company's Current Report on Form 8-K filed on February 19, 2014.*
10.5The Coca-Cola Company 1983 Restricted Stock Award Plan, as amended and restated through February 16, 2011 (the "1983 Restricted Stock Award Plan") — incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on February 17, 2011.*
10.6The Coca-Cola Company 1989 Restricted Stock Award Plan, as amended and restated through February 19, 2014 (the "1989 Restricted Stock Award Plan") — incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on February 19, 2014.*
10.6.1Form of Restricted Stock Agreement in connection with the 1989 Restricted Stock Award Plan, as adopted February 17, 2010 — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on February 18, 2010.*
10.6.2Form of Restricted Stock Agreement (Performance Share Unit Agreement) in connection with the 1989 Restricted Stock Award Plan, as adopted February 17, 2010 — incorporated herein by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on February 18, 2010.*
10.6.3Form of Restricted Stock Agreement (Performance Share Unit Agreement) for France in connection with the 1989 Restricted Stock Award Plan, as adopted February 17, 2010 — incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on February 18, 2010.*
10.6.4Form of Restricted Stock Agreement (Performance Share Unit Agreement) in connection with the 1989 Restricted Stock Award Plan, as adopted February 16, 2011 — incorporated herein by reference to Exhibit 10.5 to the Company's Current Report on Form 8-K filed on February 17, 2011.*
10.6.5Form of Restricted Stock Agreement (Performance Share Unit Agreement) for France in connection with the 1989 Restricted Stock Award Plan, as adopted February 16, 2011 — incorporated herein by reference to Exhibit 10.6 to the Company's Current Report on Form 8-K filed on February 17, 2011.*
10.6.6Form of Restricted Stock Unit Agreement in connection with the 1989 Restricted Stock Award Plan, as adopted February 15, 2012 — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on February 15, 2012.*
10.6.7Form of Restricted Stock Unit Agreement in connection with the 1989 Restricted Stock Award Plan, as adopted February 15, 2012 — incorporated herein by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on February 15, 2012.*
10.6.8Form of Restricted Stock Unit Agreement in connection with the 1989 Restricted Stock Award Plan, as adopted February 15, 2012 — incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on February 15, 2012.*
10.6.9Form of Restricted Stock Unit Agreement in connection with the 1989 Restricted Stock Award Plan, as adopted February 15, 2012 — incorporated herein by reference to Exhibit 10.4 to the Company's Current Report on Form 8-K filed on February 15, 2012.*
10.6.10Form of Restricted Stock Agreement (Performance Share Unit Agreement) in connection with the 1989 Restricted Stock Award Plan, as adopted February 15, 2012 — incorporated herein by reference to Exhibit 10.5 to the Company's Current Report on Form 8-K filed on February 15, 2012.*
10.6.11Form of Restricted Stock Agreement (Performance Share Unit Agreement) for France in connection with the 1989 Restricted Stock Award Plan, as adopted February 15, 2012 — incorporated herein by reference to Exhibit 10.6 to the Company's Current Report on Form 8-K filed on February 15, 2012.*
10.6.12Form of Restricted Stock Agreement (Performance Share Unit Agreement) in connection with the 1989 Restricted Stock Award Plan, as adopted February 20, 2013 — incorporated herein by reference to Exhibit 10.4 to the Company's Current Report on Form 8-K filed on February 20, 2013.*
10.6.13Form of Restricted Stock Agreement (Performance Share Unit Agreement) in connection with the 1989 Restricted Stock Award Plan, as adopted February 20, 2013 — incorporated herein by reference to Exhibit 10.5 to the Company's Current Report on Form 8-K filed on February 20, 2013.*
10.6.14Form of Restricted Stock Unit Agreement in connection with the 1989 Restricted Stock Award Plan, as adopted February 20, 2013 — incorporated herein by reference to Exhibit 10.6 to the Company's Current Report on Form 8-K filed on February 20, 2013.*
10.6.15Form of Restricted Stock Unit Agreement in connection with the 1989 Restricted Stock Award Plan, as adopted February 20, 2013 — incorporated herein by reference to Exhibit 10.7 to the Company's Current Report on Form 8-K filed on February 20, 2013.*
10.6.16Form of Restricted Stock Agreement (Performance Share Unit Agreement) in connection with the 1989 Restricted Stock Award Plan, as adopted February 19, 2014 — incorporated herein by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on February 19, 2014.*
10.6.17Form of Restricted Stock Unit Agreement in connection with the 1989 Restricted Stock Award Plan, as adopted February 19, 2014 — incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on February 19, 2014.*

162



10.7The Coca-Cola Company 2014 Equity Plan (the "2014 Equity Plan") — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on April 23, 2014.*
10.7.1Form of Performance Share Agreement for grants under the 2014 Equity Plan, as adopted February 18, 2015 — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on February 18, 2015.*
10.7.2Form of Performance Share Agreement alternate for grants under the 2014 Equity Plan, as adopted February 18, 2015 — incorporated herein by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on February 18, 2015.*
10.7.3Form of Stock Option Agreement for grants under the 2014 Equity Plan, as adopted February 18, 2015 — incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on February 18, 2015.*
10.7.4Form of Restricted Stock Unit Agreement for grants under the 2014 Equity Plan, as adopted February 18, 2015 — incorporated herein by reference to Exhibit 10.4 to the Company's Current Report on Form 8-K filed on February 18, 2015.*
10.8The Coca-Cola Company Compensation Deferral & Investment Program of the Company, as amended (the "Compensation Deferral & Investment Program"), including Amendment Number Four, dated November 28, 1995 — incorporated herein by reference to Exhibit 10.13 to the Company's Annual Report on Form 10-K for the year ended December 31, 1995.*
10.8.1Amendment Number Five to the Compensation Deferral & Investment Program, effective as of January 1, 1998 — incorporated herein by reference to Exhibit 10.8.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 1997.*
10.8.2Amendment Number Six to the Compensation Deferral & Investment Program, dated as of January 12, 2004, effective January 1, 2004 — incorporated herein by reference to Exhibit 10.9.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 2003.*
10.9The Coca-Cola Company Supplemental Pension Plan, Amended and Restated effective January 1, 2010 (the "Supplemental Pension Plan") — incorporated herein by reference to Exhibit 10.10.6 to the Company's Annual Report on Form 10-K for the year ended December 31, 2009.*
10.9.1Amendment One to the Supplemental Pension Plan, effective December 31, 2012, dated December 6, 2012 — incorporated herein by reference to Exhibit 10.10.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.*
10.9.2Amendment Two to the Supplemental Pension Plan, effective April 1, 2013, dated March 19, 2013 — incorporated herein by reference to Exhibit 10.10 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 29, 2013.*
10.10The Coca-Cola Company Supplemental 401(k) Plan (f/k/a the Supplemental Thrift Plan of the Company), Amended and Restated Effective January 1, 2012, dated December 14, 2011 — incorporated herein by reference to Exhibit 10.11 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.*
10.11The Coca-Cola Company Supplemental Cash Balance Plan, effective January 1, 2012 (the "Supplemental Cash Balance Plan") — incorporated herein by reference to Exhibit 10.12 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.*
10.11.1Amendment One to the Supplemental Cash Balance Plan, dated December 6, 2012 — incorporated herein by reference to Exhibit 10.12.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.*
10.11.2Amendment Two to the Supplemental Cash Balance Plan, dated June 15, 2015 — incorporated herein by reference to Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q for the quarter ended July 3, 2015.*
10.12The Coca-Cola Company Directors' Plan, amended and restated on December 13, 2012, effective January 1, 2013 — incorporated herein by reference to Exhibit 10.13 to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.*
10.13Deferred Compensation Plan of the Company, as amended and restated December 8, 2010 — incorporated herein by reference to Exhibit 10.16 to the Company's Annual Report on Form 10-K for the year ended December 31, 2010.*
10.14The Coca-Cola Export Corporation Employee Share Plan, effective as of March 13, 2002 — incorporated herein by reference to Exhibit 10.31 to the Company's Annual Report on Form 10-K for the year ended December 31, 2002.*
10.15The Coca-Cola Company Benefits Plan for Members of the Board of Directors, as amended and restated through April 14, 2004 (the "Benefits Plan for Members of the Board of Directors") — incorporated herein by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2004.*

163



10.15.1Amendment Number One to the Benefits Plan for Members of the Board of Directors, dated December 16, 2005 — incorporated herein by reference to Exhibit 10.31.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2005.*
10.16The Coca-Cola Company Severance Pay Plan, As Amended and Restated, Effective January 1, 2012, dated December 14, 2011 — incorporated herein by reference to Exhibit 10.22 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.*
10.17Order Instituting Cease-and-Desist Proceedings, Making Findings and Imposing a Cease-and-Desist Order Pursuant to Section 8A of the Securities Act of 1933 and Section 21C of the Securities Exchange Act of 1934 — incorporated herein by reference to Exhibit 99.3 to the Company's Current Report on Form 8-K filed on April 18, 2005.
10.18Offer of Settlement of The Coca-Cola Company — incorporated herein by reference to Exhibit 99.2 to the Company's Current Report on Form 8-K filed on April 18, 2005.
10.19Share Purchase Agreement among Coca-Cola South Asia Holdings, Inc. and San Miguel Corporation, San Miguel Beverages (L) Pte Limited and San Miguel Holdings Limited in connection with the Company's purchase of Coca-Cola Bottlers Philippines, Inc., dated December 23, 2006 — incorporated herein by reference to Exhibit 99.1 to the Company's Current Report on Form 8-K filed on December 29, 2006.
10.20Cooperation Agreement between Coca-Cola South Asia Holdings, Inc. and San Miguel Corporation in connection with the Company's purchase of Coca-Cola Bottlers Philippines, Inc., dated December 23, 2006 — incorporated herein by reference to Exhibit 99.2 to the Company's Current Report on Form 8-K filed on December 29, 2006.
10.21Offer Letter, dated July 20, 2007, from the Company to Joseph V. Tripodi, including Agreement on Confidentiality, Non-Competition and Non-Solicitation, dated July 20, 2007 — incorporated herein by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 28, 2007.*
10.21.1Agreement between the Company and Joseph V. Tripodi, dated December 15, 2008 — incorporated herein by reference to Exhibit 10.47.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2008.*
10.21.2Separation Agreement and Full and Complete Release and Agreement on Competition, Trade Secrets and Confidentiality between The Coca-Cola Company and Joseph V. Tripodi, dated December 5, 2014.*
10.22Letter, dated July 17, 2008, to Muhtar Kent — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on July 21, 2008.*
10.23Letter of Understanding between the Company and Ceree Eberly, dated October 26, 2009, including Agreement on Confidentiality, Non-Competition and Non-Solicitation, dated November 1, 2009 — incorporated herein by reference to Exhibit 10.47 to the Company's Annual Report on Form 10-K for the year ended December 31, 2009.*
10.24The Coca-Cola Export Corporation Overseas Retirement Plan, as amended and restated, effective October 1, 2007 — incorporated herein by reference to Exhibit 10.55 to the Company's Annual Report on Form 10-K for the year ended December 31, 2008.*
10.24.1Amendment Number One to The Coca-Cola Export Corporation Overseas Retirement Plan, as Amended and Restated, Effective October 1, 2007, dated September 29, 2011 — incorporated herein by reference to Exhibit 10.34.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.*
10.24.2Amendment Number Two to The Coca-Cola Export Corporation Overseas Retirement Plan, as Amended and Restated, Effective October 1, 2007, dated November 14, 2011 — incorporated herein by reference to Exhibit 10.34.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.*
10.24.3Amendment Number Three to The Coca-Cola Export Corporation Overseas Retirement Plan, as Amended and Restated, Effective October 1, 2007, dated September 27, 2012 — incorporated herein by reference to Exhibit 10.11 to the Company's Quarterly Report on Form 10-Q filed on September 28, 2012.*
10.25The Coca-Cola Export Corporation International Thrift Plan, as Amended and Restated, Effective January 1, 2011 — incorporated herein by reference to Exhibit 10.8 to the Company's Quarterly Report on Form 10-Q for the quarter ended April 1, 2011.*
10.25.1Amendment Number One to The Coca-Cola Export Corporation International Thrift Plan, as Amended and Restated, Effective January 1, 2011, dated September 20, 2011 — incorporated herein by reference to Exhibit 10.35.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.* 
10.25.2Amendment Number Two to The Coca-Cola Export Corporation International Thrift Plan, as Amended and Restated, Effective January 1, 2011, dated September 27, 2012 — incorporated herein by reference to Exhibit 10.10 to the Company's Quarterly Report on Form 10-Q filed on September 28, 2012.*
10.26The Coca-Cola Export Corporation Mobile Employees Retirement Plan, effective January 1, 2012.*
10.27Letter Agreement, dated as of June 7, 2010, between The Coca-Cola Company and Dr Pepper Seven-Up, Inc. — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on June 7, 2010.

164



10.28Coca-Cola Enterprises Inc. 2001 Stock Option Plan — incorporated herein by reference to Exhibit 99.4 to the Company's Registration Statement on Form S-8 (Registration No. 333-169722) filed on October 1, 2010.*
10.29Coca-Cola Enterprises Inc. 2004 Stock Award Plan — incorporated herein by reference to Exhibit 99.5 to the Company's Registration Statement on Form S-8 (Registration No. 333-169722) filed on October 1, 2010.*
10.30Coca-Cola Enterprises Inc. 2007 Incentive Award Plan — incorporated herein by reference to Exhibit 99.6 to the Company's Registration Statement on Form S-8 (Registration No. 333-169722) filed on October 1, 2010.*
10.30.1Form of 2007 Stock Option Agreement (Senior Officers) under the Coca-Cola Enterprises Inc. 2007 Incentive Award Plan — incorporated herein by reference to Exhibit 10.32 to Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Annual Report on Form 10-K for the year ended December 31, 2007.*
10.30.2Form of Stock Option Agreement (Chief Executive Officer and Senior Officers) under the Coca-Cola Enterprises Inc. 2007 Incentive Award Plan for Awards after October 29, 2008 — incorporated herein by reference to Exhibit 10.16.4 to Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Annual Report on Form 10-K for the year ended December 31, 2008.*
10.30.3Form of 2007 Restricted Stock Unit Agreement (Senior Officers) under the Coca-Cola Enterprises Inc. 2007 Incentive Award Plan — incorporated herein by reference to Exhibit 10.16.7 to Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Annual Report on Form 10-K for the year ended December 31, 2008.*
10.30.4Form of 2007 Performance Share Unit Agreement (Senior Officers) under the Coca-Cola Enterprises Inc. 2007 Incentive Award Plan — incorporated herein by reference to Exhibit 10.16.10 to Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Annual Report on Form 10-K for the year ended December 31, 2008.*
10.30.5Form of Performance Share Unit Agreement (Chief Executive Officer and Senior Officers) under the Coca-Cola Enterprises Inc. 2007 Incentive Award Plan for Awards after October 29, 2008 — incorporated herein by reference to Exhibit 10.16.12 to Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Annual Report on Form 10-K for the year ended December 31, 2008.*
10.31Coca-Cola Refreshments USA, Inc. Supplemental Matched Employee Savings and Investment Plan (Amended and Restated Effective January 1, 2010) — incorporated herein by reference to Exhibit 10.2 to Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Annual Report on Form 10-K for the year ended December 31, 2009.*
10.31.1First Amendment to the Coca-Cola Refreshments USA, Inc. Supplemental Matched Employee Savings and Investment Plan (Amended and Restated Effective January 1, 2010), dated September 24, 2010 — incorporated herein by reference to Exhibit 10.45.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2010.*
10.31.2Second Amendment to the Coca-Cola Refreshments USA, Inc. Supplemental Matched Employee Savings and Investment Plan (Amended and Restated Effective January 1, 2010), dated November 3, 2010 — incorporated herein by reference to Exhibit 10.45.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 2010.*
10.31.3Third Amendment to the Coca-Cola Refreshments USA, Inc. Supplemental Matched Employee Savings and Investment Plan, Effective January 1, 2010, dated February 15, 2011 — incorporated herein by reference to Exhibit 10.45.4 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.*
10.31.4Fourth Amendment to the Coca-Cola Refreshments USA, Inc. Supplemental Matched Employee Savings and Investment Plan, effective December 31, 2011, dated December 14, 2011 — incorporated herein by reference to Exhibit 10.45.5 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.*
10.32Coca-Cola Refreshments Executive Pension Plan, dated December 13, 2010 (Amended and Restated, Effective January 1, 2011) — incorporated herein by reference to Exhibit 10.46 to the Company's Annual Report on Form 10-K for the year ended December 31, 2010.*
10.32.1Amendment Number One to the Coca-Cola Refreshments Executive Pension Plan (Amended and Restated, Effective January 1, 2011), dated as of July 14, 2011 — incorporated herein by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2011.*
10.32.2 Amendment Number Two to the Coca-Cola Refreshments Executive Pension Plan, effective December 31, 2011, dated December 14, 2011 — incorporated herein by reference to Exhibit 10.46.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 2011.*
10.33 Amendment to certain Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Employee Benefit Plans and Equity Plans, effective December 6, 2010 — incorporated herein by reference to Exhibit 10.49 to the Company's Annual Report on Form 10-K for the year ended December 31, 2010.*
10.34 Offer Letter, dated October 21, 2010, from the Company to Steven A. Cahillane, including Agreement on Confidentiality, Non-Competition and Non-Solicitation, dated November 10, 2010 — incorporated herein by reference to Exhibit 10.50 to the Company's Annual Report on Form 10-K for the year ended December 31, 2010.*
10.34.1Letter, dated September 11, 2012, from the Company to Steven A. Cahillane — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on September 14, 2012.*

149



10.34.2Separation Agreement and Full and Complete Release and Agreement on Competition, Trade Secrets and Confidentiality between The Coca-Cola Company and Steven A. Cahillane, dated effective January 21, 2014 — incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 24, 2014.*
10.35Offer Letter, dated January 5, 2011, from the Company to Guy Wollaert, including Agreement on Confidentiality, Non-Competition and Non-Solicitation, dated June 23, 2008 — incorporated herein by reference to Exhibit 10.9 to the Company's Quarterly Report on Form 10-Q for the quarter ended April 1, 2011.*
10.36Letter, dated September 11, 2012, from the Company to Ahmet Bozer — incorporated herein by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on September 14, 2012.*

165



10.37
10.34.1Separation Agreement and Full and Complete Release and Agreement on Competition, Trade Secrets and Confidentiality between The Coca-Cola Company and Ahmet Bozer, dated August 12, 2015 — incorporated herein by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on August 13, 2015.*
10.35 Letter, dated September 11, 2012, from the Company to Brian Smith — incorporated herein by reference to Exhibit 10.5 to the Company's Current Report on Form 8-K filed on September 14, 2012.*
10.3810.36 Letter, dated September 11, 2012, from the Company to J. Alexander Douglas, Jr. — incorporated herein by reference to Exhibit 10.6 to the Company's Current Report on Form 8-K filed on September 14, 2012.*
10.3910.37 Letter, dated September 11, 2012, from the Company to Nathan Kalumbu — incorporated herein by reference to Exhibit 10.8 to the Company's Current Report on Form 8-K filed on September 14, 2012.*
10.40Letter, dated September 11, 2012, from the Company to James Quincey — incorporated herein by reference to Exhibit 10.9 to the Company's Current Report on Form 8-K filed on September 14, 2012.*
10.40.1Service Agreement between Beverage Services Limited and James Robert Quincey, dated November 14, 2012 — incorporated herein by reference to Exhibit 10.57.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.*
10.4110.38 Coca-Cola Refreshments Supplemental Pension Plan (Amended and Restated Effective January 1, 2011), dated December 13, 2010 — incorporated herein by reference to Exhibit 10.7 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 30, 2012.*
10.41.110.38.1 Amendment Number One to the Coca-Cola Refreshments Supplemental Pension Plan, dated December 14, 2011 — incorporated herein by reference to Exhibit 10.8 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 30, 2012.*
10.41.210.38.2 Amendment Two to the Coca-Cola Refreshments Supplemental Pension Plan, dated December 6, 2012 — incorporated herein by reference to Exhibit 10.59.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.*
10.41.310.38.3 Amendment Three to the Coca-Cola Refreshments Supplemental Pension Plan, adopted March 19, 2013 — incorporated herein by reference to Exhibit 10.8 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 29, 2013.*
10.4210.38.4Amendment Four to the Coca-Cola Refreshments Supplemental Pension Plan, dated June 15, 2015 — incorporated herein by reference to Exhibit 10.5 to the Company's Quarterly Report on Form 10-Q for the quarter ended July 3, 2015.*
10.39 Coca-Cola Refreshments Severance Pay Plan for Exempt Employees, effective as of January 1, 2012 — incorporated herein by reference to Exhibit 10.60.1 to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.*
10.42.110.39.1 Amendment One to the Coca-Cola Refreshments Severance Pay Plan for Exempt Employees, effective January 1, 2012, dated May 24, 2012 — incorporated herein by reference to Exhibit 10.60.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.*
10.42.210.39.2 Amendment Two to the Coca-Cola Refreshments Severance Pay Plan for Exempt Employees, dated December 6, 2012 — incorporated herein by reference to Exhibit 10.60.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 2012.*
10.42.310.39.3 Amendment Three to the Coca-Cola Refreshments Severance Pay Plan for Exempt Employees, adopted March 19, 2013 — incorporated herein by reference to Exhibit 10.9 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 29, 2013.*
10.43The Coca-Cola Company Severance Pay Plan for Certain Legacy CCNA Employees, effective as of January 1, 2013*
10.43.1Amendment One to The Coca-Cola Severance Pay Plan for Certain Legacy CCNA Employees, effective February 28, 2014, dated September 22, 2014*
10.4410.40 Letter, dated December 16, 2013, from the Company to Irial Finan — incorporated herein by reference to Exhibit 10.46 to the Company's Annual Report on Form 10-K for the year ended December 31, 2013.*
10.4510.40.1Letter, dated April 29, 2015, from the Company to Irial Finan — incorporated herein by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q filed on July 29, 2015.*
10.41 Letter, dated April 24, 2014, from the Company to Kathy N. Waller — incorporated herein by reference to Exhibit 10.1 to the Company's QuarterlyCurrent Report on Form 8-K filed on April 25, 2014.*
10.4610.42 Letter, dated October 15, 2014, from the Company to Atul Singh.Singh — incorporated herein by reference to Exhibit 10.46 to the Company's Annual Report on Form 10-K for the year ended December 31, 2014.*
10.4710.43 Letter, dated December 16, 2014, from the Company to Marcos de Quinto.Quinto — incorporated herein by reference to Exhibit 10.47 to the Company's Annual Report on Form 10-K for the year ended December 31, 2014.*
10.44Letter, dated February 12, 2015, from the Company to Ed Hays — incorporated herein by reference to Exhibit 10.5 to the Company's Quarterly Report on Form 10-Q filed on April 30, 2015.*
10.45Letter, dated April 29, 2015, from the Company to Julie Hamilton — incorporated herein by reference to Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q filed on July 29, 2015.*
10.46Letter, dated August 12, 2015, from the Company to James Quincey — incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on August 13, 2015.*
10.47Separation Agreement and Full and Complete Release and Agreement on Competition, Trade Secrets and Confidentiality between The Coca-Cola Company and Alex Cummings, dated December 23, 2015.*
10.48Letter, dated October 14, 2015, from the Company to Bernhard Goepelt.*

150166



12.1 Computation of Ratios of Earnings to Fixed Charges for the years ended December 31, 2015, 2014, 2013, 2012 2011 and 2010.2011.
21.1 List of subsidiaries of the Company as of December 31, 2014.2015.
23.1 Consent of Independent Registered Public Accounting Firm.
24.1 Powers of Attorney of Officers and Directors signing this report.
31.1 Rule 13a-14(a)/15d-14(a) Certification, executed by Muhtar Kent, Chairman of the Board of Directors and Chief Executive Officer and President of The Coca-Cola Company.
31.2 Rule 13a-14(a)/15d-14(a) Certification, executed by Kathy N. Waller, Executive Vice President and Chief Financial Officer of The Coca-Cola Company.
32.1 Certifications required by Rule 13a-14(b) or Rule 15d-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350), executed by Muhtar Kent, Chairman of the Board of Directors and Chief Executive Officer and President of The Coca-Cola Company and by Kathy N. Waller, Executive Vice President and Chief Financial Officer of The Coca-Cola Company.
101 
The following financial information from The Coca-Cola Company's Annual Report on Form 10-K for the year ended December 31, 2014,2015, formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Statements of Income for the years ended December 31, 2015, 2014 2013 and 2012,2013, (ii) Consolidated Statements of Comprehensive Income for the years ended December 31, 2015, 2014 2013 and 2012,2013, (iii) Consolidated Balance Sheets as of December 31, 20142015 and 2013,2014, (iv) Consolidated Statements of Cash Flows for the years ended December 31, 2015, 2014 2013 and 2012,2013, (v) Consolidated Statements of Shareowners' Equity for the years ended December 31, 2015, 2014 2013 and 20122013 and (vi) the Notes to Consolidated Financial Statements.



* 
Management contracts and compensatory plans and arrangements required to be filed as exhibits pursuant to Item 15(b) of this report.Form 10-K.

151



SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
THE COCA-COLA COMPANY
(Registrant)
By:/s/ MUHTAR KENT
Muhtar Kent
Chairman of the Board of Directors,
Chief Executive Officer and President
Date:February 25, 2015

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
/s/ MUHTAR KENT/s/ KATHY N. WALLER
Muhtar Kent
Chairman of the Board of Directors,
Chief Executive Officer,
President and a Director
(Principal Executive Officer)
Kathy N. Waller
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
February 25, 2015February 25, 2015
/s/ LARRY M. MARK/s/ MARK RANDAZZA
Larry M. Mark
Vice President and Controller
(As Principal Accounting Officer)
Mark Randazza
Vice President and Assistant Controller
(On behalf of the Registrant)
February 25, 2015February 25, 2015
**
Herbert A. Allen
Director
Richard M. Daley
Director
February 25, 2015February 25, 2015
**
Ronald W. Allen
Director
Barry Diller
Director
February 25, 2015February 25, 2015
**
Marc Bolland
Director
Helene D. Gayle
Director
February 25, 2015February 25, 2015
**
Ana Botín
Director
Evan G. Greenberg
Director
February 25, 2015February 25, 2015

152167



**
Howard G. Buffett
Director
Sam Nunn
Director
February 25, 2015February 25, 2015
**
Alexis M. Herman
Director
James D. Robinson III
Director
February 25, 2015February 25, 2015
**
Robert A. Kotick
Director
Peter V. Ueberroth
Director
February 25, 2015February 25, 2015
**
Maria Elena Lagomasino
Director
David B. Weinberg
Director
February 25, 2015February 25, 2015


*By:/s/ GLORIA K. BOWDEN
Gloria K. Bowden
Attorney-in-fact
February 25, 2015

153