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Dear PepsiCo Board Member:

On May 2, PepsiCo, Inc. will be holding its annual shareholders' meeting and considering a proposal urging the adoption of recycling initiatives.

We respectfully ask that you to give this proposal your full consideration, for it would truly benefit the company.

Exciting new things are happening at PepsiCo, and we hope that one of these will be to bring the company into a position of environmental leadership within the beverage industry in a very visible way.

As proud PepsiCo shareholders and concerned citizens, we think it is of the utmost importance that PepsiCo be a leader specifically in promoting recycling and sustainable packaging practices.

We can think of nothing that would do more to capture the public's imagination, appeal to young people, and give PepsiCo an advantage over competitors than an environmental initiative that was sincere, effective, and powerful.

The environmental community would like PepsiCo to make a firm commitment to establish a system that achieves an 80% collection rate over five years, an easily achievable goal that is already being met in the ten U.S. states with container deposit systems.

As you may know, collection rates for both plastic and aluminum have been declining for six years, to the point where the collection rate for all containers (plastic, aluminum and glass) is less than 35% in non-bottle bill states, and a shocking 10% for plastic beverage containers in non-bottle bill states.

PepsiCo can also easily introduce on a nationwide basis a minimum 25% recycled plastic in PET beverage bottles, the level currently being used in most bottles of Gatorade.

If both of these initiatives are undertaken together, existing industries can utilize as feedstocks all collected plastic, glass and aluminum without market disruption. The impact on employment, tax revenues and wealth creation could be substantial and significant. And Pepsi could rightly take credit for this monumental achievement.

We hope that PepsiCo will make a public commitment to achieve 25% plastic recycled content and 80% collection for all containers in five years. But we also need to hear details of how the goals will be achieved, resources to be committed, and benchmarks of progress. We have heard commitments before that turned out to be empty promises.

It is also important that PepsiCo reverse its refusal to address the issue of aluminum can waste, which has an even greater negative impact than plastic. Indeed, each can has an energy content of a third of a can of gasoline; industry-wide, 45 billion of these cans were landfilled in the United States last year!

We understand there are many stakeholders involved in both increasing collection and recycled plastic content. But as a leader in this industry, Pepsi has an opportunity to use its enormous influence to shape a system that can achieve these goals.

An additional concern we have is PepsiCo's continued support of and active involvement in organizations fighting such initiatives, including Keep America Beautiful and the National Soft Drink Association. These groups are widely (and we believe justifiably) seen as having an anti-environmental mission, and are working to oppose laws and regulations to protect the environment, especially bottle deposits.

Moreover, we are concerned that the Coca-Cola Company, PepsiCo's main competitor, has already set goals for container recycling and recycled content plastic. In addition, while Coca-Cola uses recycled content plastic in at least five countries, it's our understanding that PepsiCo does not use recycled content plastic anywhere.

The investment community is looking to PepsiCo's current management for bold action. Some believe PepsiCo has seized the initiative on fronts such as 'New Age' and healthy beverages that appeal to young people. A rapid and strong commitment by PepsiCo to these pro-environmental policies could create a huge impact, and demonstrate that the company has the boldness and foresight to grasp the baton of leadership and carry it to victory.

We hope you will consider the recycling proposal and direct PepsiCo management to come up with exciting, innovative, conscientious policies that will benefit our company, our community, and our habitat on which we are all ultimately dependent.

Sincerely yours,

PepsiCo Shareholders
and
Concerned Organizations

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