Company Name: PepsiCo, Inc.
Public Availability Date: March 2, 2007
Document Sections:
INQUIRY LETTER
APPENDIX
INQUIRY LETTER
STAFF REPLY LETTER
[INQUIRY LETTER]
January 3, 2007
Securities and Exchange Commission
Division of Corporation Finance
Office of Chief Counsel
100 F Street, N.E.
Washington, D.C. 20549
Re: PepsiCo, Inc. Shareholder Proposal from Adrian Dominican Sisters and
Co-Filers
Ladies and Gentlemen:
Pursuant to Rule 14a-8(j) under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), PepsiCo, Inc. (the "Company" or "PepsiCo") hereby notifies
the Securities and Exchange Commission (the "SEC") of its intention to omit from
the Company's proxy materials (the "Proxy Materials") for its 2007 Annual
Shareholders' Meeting, the proposal and supporting statement submitted by Adrian
Dominican Sisters and co-filed by the Dominican Sisters of St. Mary of the
Springs, Columbus, OH, Dominican Sisters, Congregation of St. Mary, New Orleans,
LA, Dominican Sisters of Oxford, MI, Dominican Sisters of Great Bend, KS,
Benedictine Sisters of Mount St. Scholastica, Benedictine Sisters of Mt. Angel,
OR, Congregation of Benedictine Sisters, Boerne, TX, Congregation of Holy Cross,
Sisters of Mercy of the Americas, Sisters of Mercy of the St. Louis Regional
Community, Inc., Congregation of the Sisters of Charity of the Incarnate Word,
Sisters of St. Joseph of La Grange, School Sisters of Notre Dame Cooperative
Investment Fund and Basilian Fathers of Toronto (collectively, the "Proponent")
dated November 14, 2006 (the "Proposal") attached as Exhibit A.
Pursuant to Rule 14a-8(j)(2), six (6) copies of the Proposal and six (6) copies
of this letter are enclosed. By copy of this letter, the Company is also
notifying the Proponent of the Company's intention to omit the Proposal from its
2007 Proxy Materials for the reasons stated below. The Company presently intends
to file its Proxy Materials on or after March 26, 2007. Accordingly, pursuant to
Rule 14a-8(j), this letter is being submitted not less than 80 calendar days
before the Company files its Proxy Materials with the SEC.
The Proposal and Grounds for Omission
On November 20, 2006, the Company received a letter from the Proponent
containing the following Proposal:
"RESOLVED: Shareholders request that the Board of Directors adopt a policy to
identify and label all food products manufactured or sold by the company under
the company's brand names or private labels that may contain genetically
engineered (GE) ingredients."
The Company believes the Proposal may be omitted from its 2007 Proxy Materials
pursuant to: i) Rule 14a-8(i)(7), as the Proposal deals with a matter relating
to the Company's ordinary business operations (i.e. sale of particular products)
and (ii) Rule 14a-8(i)(3) and Rule 14a-9, as the Proposal is inherently vague
and indefinite under such rules.
1. The Proposal may be omitted because it deals with a matter relating to the
Company's ordinary business operations (i.e. sale of particular products).
Pursuant to Rule 14a-8(i)(7) of the Exchange Act, a shareholder proposal may be
omitted from a company's proxy materials if the proposal "deals with a matter
relating to the company's ordinary business operations." The general policy
underlying the "ordinary business" exclusion is the confinement of "the
resolution of ordinary business problems to management and the board of
directors, since it is impracticable for shareholders to decide how to solve
such problems at an annual shareholders meeting." This policy rests on two
central considerations. The first consideration is the subject matter of the
proposal, as "[c]ertain tasks are so fundamental to management's ability to run
a company on a day-to-day basis that they could not, as a practical matter, be
subject to direct shareholder oversight." The second consideration is "the
degree to which the proposal seeks to `micro-manage' the company by probing too
deeply into matters of a complex nature upon which shareholders, as a group,
would not be in a position to make an informed judgment." See Exchange Act
Release No. 34-40018 (May 21, 1998).
In a series of no-action letters, the Staff of the SEC Division of Corporation
Finance (the "Staff") has specifically concluded that shareholder proposals that
seek to affect a company's ability to select raw materials and ingredients for
particular products may properly be omitted from a company's proxy materials.
See Walgreen Co. (October 13, 2006) and Wal-Mart Stores, Inc. (March 24, 2006)
(each allowing exclusion of a shareholder proposal that requested identification
of toxic substances in products sold by the company).
Decisions concerning the selection of raw materials and ingredients to be used
in PepsiCo's food products are inherently based on complex business
considerations that are outside the knowledge and expertise of the shareholders.
These decisions are fundamental to management's ability to control the operation
of the Company. Similarly, the selection of raw material ingredients for
PepsiCo's food products within parameters established by the FDA and applicable
state and federal regulations are clearly matters relating to PepsiCo's ordinary
business operations. The Proposal seeks to involve shareholders in a fundamental
aspect of management's handling of the Company's business operations and seeks
to "micro-manage" the Company's decision-making with respect to selection of
ingredients and raw materials. See Borden, Inc. (January 16, 1990) (finding that
while the Proponent claimed that irradiated food was unsafe, the use of
irradiated food was related to ordinary business operations because it involved
the choice of processes and supplies used in the preparation of Borden's
products). The determination as to whether PepsiCo's policies are more stringent
than relevant statutory requirements in also a matter related to its ordinary
business operations. See Hormel Foods Corp. (November 19, 2002).
Therefore, the Company believes the Proposal may properly be excluded under Rule
14a-8(i)(7) as it seeks to restrain management's ability to run the Company on a
day-to-day basis and seeks to "micro-manage" the Company by addressing an area,
selection of raw materials and ingredients, where shareholders as a group would
not be in a position to make an informed judgment.
2. The Proposal may be omitted because it contravenes Rules 14a-8(i)(3) and Rule
14a-9 of the Exchange Act.
Rule 14a-8(i)(3) of the Exchange Act permits a company to omit from its proxy
materials a shareholder proposal, and any statements in support thereof, that is
"contrary to any of the Commission's proxy rules, including Rule 14a-9, which
prohibits materially false and misleading statements in proxy soliciting
materials."
In Staff Bulletin No. 14B (September 15, 2004), the Staff clarified situations
when it is appropriate for a company to seek concurrence with the determination
to exclude or modify a proposal or supporting statement in reliance on Rule
14a-8(i)(3). Specifically, Item B.4. of Staff Bulleting No. 14B states that it
is appropriate for a company to request exclusion or modification of: (i) a
proposal and a supporting statement that when read together are inherently vague
or indefinite such that neither the stockholders voting on the proposal nor the
company in implementing the proposal would be able to determine with any
reasonable certainty exactly what actions or measures the proposal requires,
(ii) substantial portions of a supporting statement that are irrelevant to
consideration of the subject matter of the proposal such that there is a strong
likelihood that a reasonable shareholder would be uncertain as to the matter on
which he is being asked to vote or (iii) a statement the company can objectively
demonstrate is materially false or misleading.
The Company believes that the Proposal may properly be excluded under Rule
14a-8(i)(3) because the Proposal is inherently vague and indefinite such that
neither the stockholders voting on the Proposal nor the Company in implementing
the Proposal would be able to determine with any reasonable certainty exactly
what actions or measures the Proposal requires.
Alternatively, if the Staff is unable to concur with the conclusion that the
entire Proposal should be excluded, we respectfully request that the Staff
recommend exclusion of the portions of the Proposal's supporting statement (the
"Supporting Statement") discussed below pursuant to Rules 14a-8(i)(3) and 14a-9
and Staff Bulletin No. 14B as (i) most of the statements in the Supporting
Statement are irrelevant to consideration of the subject matter of the Proposal
and create a strong likelihood that a reasonable shareholder would be uncertain
as to the matter on which he is being asked to vote and (ii) certain of the
statements in the Supporting Statement are materially misleading. The Staff has
granted exclusion of portions of supporting statements under Rules 14a-8(i)(3)
and 14a-9 in multiple instances where companies were faced with shareholder
proposals similar to this Proposal. See Wal-Mart Stores, Inc. (February 17,
2004); Sysco Corporation (August 12, 2003); Wal-Mart Stores, Inc. (March 14,
2003); Wal-Mart Stores, Inc. (April 2, 2001) (each involving proposals that
requested identification of genetically engineered products).
a. The Proposal and the Supporting Statement when read together are inherently
vague and indefinite
The Proposal and the Supporting Statement when read together are inherently
vague and indefinite such that neither the stockholders voting on the Proposal
nor the Company in implementing the Proposal would be able to determine with any
reasonable certainty exactly what actions or measures the Proposal requires.
While the Proposal's resolution deals with the labeling of PepsiCo food
products, a majority of the Supporting Statement addresses new and irrelevant
issues, primarily the impact of genetically engineered plants and wildlife on
the environment. This inconsistency makes the Proposal vague and indefinite
because the Supporting Statements ask stockholders to consider issues beyond
those stated in the Proposal's resolution. As a result, neither the stockholders
voting on the Proposal nor the Company in implementing the Proposal will be able
to determine with any reasonable certainty exactly what actions or measures the
Proposal requires.
Further, the Proposal's resolution itself is vague and indefinite in that it
asks shareholders to consider matters relating to "genetically engineered (GE)
ingredients" but does not provide any definition for this key concept in either
the resolution or the Supporting Statement. "Genetically engineered (GE)
ingredients" is a vague and ambiguous term. The average lay person is not likely
to be familiar with this term and without a definition and description of what
the Proponent means by the use of this term, the Proposal is likely to cause
confusion such that it will be difficult to determine with any reasonable
certainty exactly what actions or measures the Proposal addresses.
Therefore, due to the vague and uncertain nature of the Proposal's resolution
and Supporting Statement, we believe the Proposal may properly be excluded in
its entirety under Rules 14a-8(i)(3) and 14a-9.
b. Substantial portions of the Proposal's Supporting Statement are irrelevant to
consideration of the subject matter of the Proposal
Substantial portions of the Supporting Statement are irrelevant to consideration
of the subject matter of the Proposal such that there is a strong likelihood
that a reasonable shareholder would be uncertain as to the matter on which he is
being asked to vote.
The Supporting Statement contains fifteen (15) bullet points. At least eleven
(11) of these fifteen (15) bullet points are devoted to topics that have no
relevance to the subject matter of the Proposal, which is labeling of food
products manufactured or sold by PepsiCo. The Proponent's choice of irrelevant
subject matter in the Supporting Statement has the effect of changing the
implication of the Proposal from a question about PepsiCo's activities to a
referendum on whether a shareholder supports the concept of genetic engineering
and creates uncertainty as to the matter on which stockholders are being asked
to vote.
Bullet points seven, ten, eleven, twelve, thirteen, fourteen and fifteen deal
with the environmental and ecological impact of genetically engineered crops and
wildlife. It is unclear what relation these issues bear to labeling of PepsiCo
food products. Based on these bullet points, a reasonable shareholder might
believe he is being asked to vote on the environmental impact of genetic
engineering.
Bullet points four and six deal with regulation of international trade. It is
unclear what relation these issues bear to labeling of PepsiCo food products.
Based on these bullet points, a reasonable shareholder might believe he is being
asked to consider the issue of regulation of international import and export of
crops.
Bullet points eight and nine address the insufficiency of scientific
methodologies in identifying genetically engineered compositional changes. The
state of scientific research is not relevant to the subject matter of this
Proposal. Based on bullet points eight and nine, a reasonable shareholder might
believe he is being asked to vote on whether the state of scientific research
into genetic engineering is sufficient.
The overwhelming emphasis of the Supporting Statement on topics other than the
labeling of PepsiCo's food products is materially misleading and creates a
strong likelihood that a reasonable shareholder would be uncertain as to the
matter on which he is being asked to vote. As a result, the Company believes the
portions of the Supporting Statement referenced above may properly be excluded
from the Company's 2007 Proxy Materials pursuant to Rules 14a-8(i)(3) and 14a-9.
c. The Proposal's Supporting Statement includes statements that are materially
misleading
When taken together, bullet points two and three are materially misleading as
they imply that PepsiCo's products and ingredients may pose a health risk. These
bullet points may have the effect of misleading shareholders by implying that
PepsiCo products may contain genetically engineered ingredients and therefore,
PepsiCo products may cause fatal food allergies. These statements may have the
effect of scaring shareholders about the safety of PepsiCo products without
providing any factual substantiation for these claims.
The United States Food&Drug Administration (FDA) is responsible for the
evaluation of food safety. FDA regulations require food ingredients to be
labeled if they cause more than the normal range of allergens, nutrients or
toxins than what is found in the equivalent, conventional food. PepsiCo abides
by all relevant FDA regulations in the labeling of its food products.
Bullet points seven and fifteen address genetically engineered salmon. PepsiCo
does not sell or market salmon in the United States and therefore these
statements are materially misleading to a shareholder's consideration of
PepsiCo's food products.
Bullet points two, three, seven and fifteen are materially misleading and thus
may be may properly be excluded pursuant to Rules 14a-8(i)(3) and 14a-9.
Conclusion
The Company believes that the Proposal may be omitted from the Company's 2007
Proxy Materials pursuant to (i) Rule 14a-8(i)(7) because the Proposal deals with
the Company's ordinary business operations (i.e. sale of particular products)
and (ii) Rule 14a-8(i)(3) and 14a-9 because the Proposal is inherently vague and
indefinite.
Based on the foregoing, the Company respectfully requests the Staff's
concurrence with the Company's decision to omit the Proposal from its 2007 Proxy
Materials, and further requests that we be notified of this concurrence. We
would be happy to provide you with additional information and answer any
questions that you may have regarding this subject. Should you disagree with the
conclusions set forth in this letter, we respectfully request the opportunity to
confer with you prior to the determination of the Staff's final position. If you
have any questions about this matter, please contact the undersigned at
914-253-3623.
Please file-stamp and return one copy of this letter in the enclosed,
self-addressed stamped envelope.
Very truly yours,
/s/
Thomas H. Tamoney, Jr.
Vice President, Deputy General
Counsel and Assistant Secretary
Enclosures
cc: (Via Certified Mail/Return Receipt Requested)
Adrian Dominican Sisters
ATTN.: Margaret Weber
1257 East Siena Heights Drive
Adrian, Michigan 49221
[APPENDIX]
Label Products of Genetic Engineering 2007 - PepsiCo, Inc.
RESOLVED: Shareholders request that the Board of Directors adopt a policy to
identify and label all food products manufactured or sold by the company under
the company's brand names or private labels that may contain genetically
engineered (GE) ingredients.
Supporting Statement
The right to know is a fundamental principle of democratic societies and
market economics.
PepsiCo products contain corn, rice and soy, all of which potentially could be
the genetically engineered variety.
Millions suffer from mild to fatal food allergies. Without labeling, consumers
have no way of protecting themselves from hidden allergens.
Unapproved Liberty Link long-grain rice contaminated U.S. rice supplies,
prompting Japan to suspend imports of US Rice, and the European Commission to
require that rice imports be certified as free of unauthorized grain. (Reuters
8/28/06).
The global alliance Action by Churches Together took a stand in support of
"right to know" whether there are genetically engineered ingredients in the food
purchased or in the seeds sown. (ReliefWeb 6/28/06)
132 countries, parties to the Cartagena Protocol, have agreed to documentation
requirements for the export and import of genetically engineered organisms.
(Financial Times 3/29/06)
As of May 19, 2005, Alaska law requires that genetically engineered salmon be
labeled as such.
The National Academy of Sciences report, Genetically Modified Pest-Protected
Plants (4/2000) recommended development of improved methods for identifying
potential allergens in genetically engineered pest-protected plants.
The report Safety of Genetically Engineered Foods: Approaches to Assessing
Unintended Health Effects (National Academy of Sciences] 7/2004) states:...
"there remain sizable gaps in our ability to identify compositional changes that
result from genetic modification of organisms intended for food... (p.15)
Post-marketing surveillance has not been used to evaluate any of the GE crops
currently on the market (p. 153)
Between 2001-2004, approximately 15,000 hectares (150 square kilometers) in
four US states were planted with unapproved Bt10 com. (New Scientist 3/23/2005)
At least nine cargo shipments to Japan have contained the illegal variety.
(Reuters 8/23/2005)
Indicators that genetically engineered organisms may be harmful to humans,
animals, or the environment include:
August 10, 2006, Federal District Court ruled that USDA's permitting of
drug-producing genetically engineered crops in Hawaii violated the Endangered
Species Act and the National Environmental Policy Act.
Genetically engineered creeping bentgrass, not yet approved commercially,
escaped into wild as far as three miles from the test plot. (8/9/06)
Five major US agricultural weeds have developed resistance to glyphosate, the
herbicide used with genetically engineered Roundup Resistant crops. Addressing
this problem includes use of additional herbicides.
Research (Environmental Health Perspectives 6/2005) has shown that Roundup,
increasingly needed on Roundup Ready crops, is toxic to human placental cells at
concentrations lower than agricultural use.
There is concern among commercial fishermen about the consequences of
genetically modified fish, not yet commercially approved, on wild salmon. (AP
3/9/2005)
[INQUIRY LETTER]
February 14, 2007
Securities & Exchange Commission
100 F Street, NE
Washington, D.C. 20549
Att: Ted Yu, Esq.
Office of the Chief Counsel
Division of Corporation Finance
Via fax 202-772-9201
Re: Shareholder Proposal submitted to PepsiCo, Inc.
Dear Sir/Madam:
I have been asked by the Adrian Dominican Sisters, the Dominican Sisters of St.
Mary of the Springs, the Dominican Sisters (Congregation of St. Mary), the
Dominican Sisters of Oxford (Michigan), the Dominican Sisters of Great Bend
(Kansas), the Benedictine Sisters of Mount St. Scholastica, the Benedictine
Sisters of Mt. Angel (Oregon), the Congregation of Benedictine Sisters of Boerne
(Texas), the Sisters of Mercy of the Americas, the Sisters of Mercy of the St.
Louis Regional Community, Inc., the Basilian Fathers of Toronto, the
Congregation of the Holy Cross (Southern Province), the Congregation of the
Sisters of Charity of the Incarnate Word (Houston, TX), the School Sisters of
Notre Dame Cooperative Investment Fund and the Sisters of St. Joseph of La
Grange (Illinois) (hereinafter jointly referred to as the "Proponents"), each of
which is a beneficial owner of shares of common stock of PepsiCo, Inc.
(hereinafter referred to either as "Pepsi" or the "Company"), and who have
jointly submitted a shareholder proposal to Pepsi to respond to the letter dated
January 3, 2007, sent to the Securities & Exchange Commission by the Company, in
which Pepsi contends that the Proponents' shareholder proposal may be excluded
from the Company's year 2007 proxy statement by virtue of Rules 14a-8(i)(7) and
14a-8(i)(3).
I have reviewed the Proponents' shareholder proposal, as well as the aforesaid
letter sent by the Company, and based upon the foregoing, as well as upon a
review of Rule 14a-8, it is my opinion that the Proponents' shareholder proposal
must be included in Pepsi's year 2007 proxy statement and that it is not
excludable by virtue of either of the cited rules.
The Proponents' shareholder proposal requests Pepsi to so label all of its own
products that contain genetically engineered ingredients.
RULE 14a-8(i)(7)
We are surprised that the Company has totally failed to fully describe an
important aspect, with which it is quite familiar, of the ordinary business
exclusion. Unfortunately the Company has failed to discuss the Commission own
interpretation of the "ordinary business" exclusion of Rule 14a-8(i)(7), namely
that it is inapplicable if the proposal raises an important social policy issue.
See Release 34-40018 (proposals that relate to ordinary business matters but
that focus on "sufficiently significant policy issues ... would not be
considered excludable, because the proposals would transcend the day to day
business matters...."); See also, e.g., Staff Legal Bulletin No 14C (June 25,
2005).
We are also saddened that Pepsi has failed to recall that the Staff has
consistently held, beginning seven years ago with the denial of a no-action
letter request made by Pepsi itself, that shareholder proposals submitted to
food and beverage companies with respect to genetic engineering raise important
policy issues. PepsiCo, Inc. (January 24, 2000). See also Wal-Mart Stores, Inc.
(March 14, 2003); The Kroger Company (April 12, 2002); Sysco Corporation (August
30, 2000); The Kroger Company (April 12, 2000); The Quaker Oats Company (March
28, 2000); Safeway. Inc. (March 23, 2000); McDonald's Corporation (March 22,
2000); Kellogg Company (March 11, 2000); E.I. DuPont de Nemours and Company
(March 3, 2000); Bestfoods (February 14, 2000); Philip Morris Companies
(February 9, 2000). The Coca-Cola Company (February 7, 2000). The 2002 Kroger
proposal, for example, was worded substantially identically to the Proponents'
proposal. For a detailed statement why such proposals raise significant policy
issues, please see the letter from the undersigned on behalf of the proponents
of the year 2000 proposal submitted to PepsiCo.
Pepsi has provided no information whatsoever that would warrant a de novo review
of this long standing Staff opinion.
For the foregoing reasons, the Company has failed to carry its burden of proving
the applicability of Rule 14a-8(i)(7) to the Proponents' shareholder proposal.
RULE 14a-8(i)(3)
Pepsi's arguments with respect to Rule 14a-8(i)(3) are no stronger.
In The Kroger Company (April 12, 2002) the registrant made substantially the
same "vague and indefinite" argument with respect to an almost identical
proposal. The Staff rejected that argument, and we believe that Pepsi's argument
deserves a similar fate.
The four letters cited by the Company are inapposite. There is no probative
value to citations of no-action letters that exclude certain phrases when those
phrases do not appear in the Proponents' shareholder proposal (e.g. Wal-Mart
Stores, Inc. (March 14, 2003)) or that address dissimilar proposals that include
non-food products (Wal-Mart Stores, Inc. (April 2, 2001).
a.
We believe that Pepsi underestimates its shareholders and its board. Neither
group would be unable to determine with reasonable certainty what actions are
required by a simple request to label certain products.
Each of the bullets in the supporting statement is relevant to the proposed
action requested by the proposal. Bullets 1, 3, 4, 5, 6, 7, 8 and 9 each deals
either with labeling itself or with possible allergens that could be present in
unlabeled products. Bullet 2 states which ingredients used by the Company might
be genetically modified. The remaining six bullet points deal with potential
harm to consumers or to the environment, each of which has led to concerns about
genetically modified food and to consumer resistance to purchasing such food.
These concerns are quite relevant to the question of whether a shareholder
should support the proposal or the Board should implement it. They are not
irrelevant to the proposal and certainly not confusing.
In general, the Company is grasping at straws, but this is especially true with
respect to its contention that the term "genetically engineered ingredients" is
vague and ambiguous. The Staff has explicitly rejected an identical argument.
Wal-Mart Stores, Inc. (March 14, 2003). See also The Kroger Company (April 12,
2002); The Kroger Company (April 12, 2000); Safeway Inc. (March 23, 2000);
Kellogg Company (March 11, 2000); E.I. du Pont de Nemours and Company (March 2,
2000). No reason appears why the term should have become more ambiguous during
the course of its common usage in the years subsequent to these Staff decisions.
b.
The material in subsection "b" of the Company's letter appears to be a rehash of
the unconvincing arguments in made subsection "a" of its 14a-8(i)(3) argument.
The relevance of the bullets has been pointed out above in subsection "a" of
this letter. In passing, we fail to understand why a statute requiring labeling
of certain genetically engineered food (bullet 7) is not relevant to a request
that the Company label its own genetically engineered products. Nor is it
apparent why an international agreement requiring labeling of genetically
engineered foods (bullet 6) is not relevant to a request that the Company label
its own genetically engineered products. Finally, it beggars belief that bullets
8 and 9 would lead any rational person to believe that she or he was being asked
to vote on whether the "the state of scientific research into genetic
engineering is sufficient". The point is that persons may rationally be fearful
of whether there are, e.g., allergens in genetically engineered food products.
c.
With respect to bullet points 2, 3, 7 and 15, as stated in Staff Legal Bulletin
No. 14B (September 15, 2004), invocation of Rule 14a-8(i)(3) is inappropriate
when the objection is, like the Company's objection, merely that the assertion
might "be interpreted by shareholders in a manner that is unfavorable to the
company" and that any such inference should not be addressed via (i)(3), but
rather in the registrant's own statement in opposition.
For the foregoing reasons, Rule 14a-8(i)(3) is inapplicable to the Proponents'
shareholder proposal.
In conclusion, we request the Staff to inform the Company that the SEC proxy
rules require denial of the Company's no action request. We would appreciate
your telephoning the undersigned at 941-349-6164 with respect to any questions
in connection with this matter or if the staff wishes any further information.
Faxes can be received at the same number. Please also note that the undersigned
may be reached by mail or express delivery at the letterhead address (or via the
email address).
Very truly yours,
/s/
Paul M. Neuhauser
Attorney at Law
cc: Thomas H Tamoney, Jr., Esq.
Margaret Webber
Leslie Lowe
Fr Michael Hoolahan
[STAFF REPLY LETTER]
March 2, 2007
Response of the Office of Chief Counsel Division of Corporation Finance
Re: PepsiCo., Inc.
Incoming letter dated January 3, 2007
The proposal requests that the board adopt a policy to identify and label all
food products manufactured or sold by the company under the company's brand
names or private labels that may contain genetically engineered ingredients.
We are unable to concur in your view that PepsiCo may exclude the proposal under
rule 14a-8(i)(7). Accordingly, we do not believe that PepsiCo may omit the
proposal from its proxy materials in reliance on rule 14a-8(i)(7).
We are unable to concur in your view that PepsiCo may exclude the proposal or
portions of the supporting statement under rule 14a-8(i)(3). Accordingly, we do
not believe PepsiCo may omit the proposal or portions of the supporting
statement from its proxy materials in reliance on rule 14a-8(i)(3).
Sincerely,
/s/
Derek B. Swanson
Attorney Adviser
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