Annual Report and Accounts 2006

All the executive Directors invested their total AIP award in the Company's shares through the Bonus Share Retention Plan rather than taking it as cash.

In the following tables, references to CEC members mean the individuals who are members of the Chief Executive's Committee (our senior management) but who are not executive Directors. One CEC member left the Group in 2006 and two new members were appointed. Remuneration shown for the CEC includes remuneration paid to the CEC member who left the Group as part of his termination package. In 2006, there were a maximum of nine individuals at any one time who were members of the CEC but who were not executive Directors.

Directors' remuneration summary (table one)

	2006 £000	2005 £000
Total remuneration:
Fees as Directors	902	534
Salaries and other benefits (a)	3,198	3,493
Annual Incentive Plan/Bonus Share Retention Plan awards (b)	2,019	2,922
Gains on share plans	3,263	2,734
Pensions paid to former executive Directors	33	32

Notes

(a)	The highest paid Director was Todd Stitzer: £3,422,000 (2005: Sir John Sunderland: £3,441,000).
(b)	These amounts relate to the Annual Incentive Plan awards for each year. The total shown includes the service related match to be awarded under the Bonus Share Retention Plan to each Director based on the AIP award which they have invested and which will vest (normally) in three years' time. The performance related matching award is shown in table six.

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Executive Directors' and CEC members' remuneration (table two)

	Base salary £000	Allowances (a) £000	Other benefits (b) £000	AIP/ BSRP (c) £000	2006 total £000	2005 total £000
Ken Hanna	560	192	-	592	1,344	1,378
Bob Stack (d)	474	270	155	498	1,397	1,386
Todd Stitzer (d)	877	511	156	929	2,473	2,381
CEC members (f)	2,995	1,464	1,173	3,057	8,689	9,214

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Directors' and CEC members' gains on share plans (table three)

	LTIP awards earned in 2006 £000	Gains on exercise of share options £000	2006 total £000	2005 total £000
Ken Hanna	558	–	558	–
Bob Stack (d)	512	2	514	429
Todd Stitzer (d)	949	–	949	266
Sir John Sunderland (e)	594	648	1,242	2,039
CEC members (f)	1,862	1,108	2,970	660

Notes

(a)	The majority of the amount shown as Allowances for expatriate Directors (Bob Stack and Todd Stitzer) and expatriate CEC members relates to income tax payments. As taxation rates in the US are lower than in the UK, US tax payers are protected from a higher tax burden by means of a tax equalisation programme funded by the Company. Under this programme, we pay an amount equal to the incremental tax resulting from the assignment of individuals to the UK. This ensures that they are not penalised financially by accepting roles of an international nature which would result in higher taxation costs than would have been the case if they had remained in their home country. Due to the nature of taxation payments, some of the amounts shown are in respect of previous financial years. For all Directors and CEC members, Allowances include flexible benefits and car allowances. Ken Hanna's allowances include an amount equal to 30% of his base salary in lieu of a pension contribution.
(b)	Other benefits include company cars and, for expatriates, housing support and other allowances necessary to ensure that they are not penalised financially by accepting roles of an international nature which result in higher costs than would have been the case if they had remained in their home country.
(c)	The total AIP award shown was awarded in respect of 2006 performance and invested in the BSRP on 5 March 2007 by each eligible Director. View the AIP and BSRP. The amount shown includes the service related matching award to be awarded under the BSRP to each Director and the aggregate for CEC members. The performance related conditional matching awards are shown in table six.
(d)	Todd Stitzer's and Bob Stack's base salaries are calculated in US dollars as follows: Todd Stitzer - US$1,618,846; Bob Stack - US$874,038.
(e)	Sir John Sunderland was appointed as non-executive Chairman on 25 August 2005. Table three shows his gains in the year on share plans arising out of awards made whilst he was an executive Director. Sir John Sunderland had until 24 August 2006 to exercise his remaining share options following his retirement as an employee.
(f)	For all remuneration, the aggregate amounts shown for the CEC are only those amounts paid to individuals whilst they were CEC members. Other benefits for CEC members include payments made in connection with the cessation of employment.

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Non-executive Directors' fees and benefits (table four)

	Other benefits £000	Board fee £000	Fee for chairing a committee £000	2006 total £000	2005 total £000
Sanjiv Ahuja (a)	-	32	-	32	-
Wolfgang Berndt	-	51	-	51	46
Rick Braddock	-	76	8	84	82
Roger Carr	-	101	-	101	93
Lord Patten	-	51	-	51	24
Sir John Sunderland (b)	3	381	-	384	132
David Thompson	-	51	15	66	57
Rosemary Thorne	-	51	-	51	46
Raymond Viault (a)	-	24	-	24	-
Baroness Wilcox	-	51	10	61	54

Notes

(a)	Sanjiv Ahuja was appointed as a non-executive Director on 19 May 2006 and Raymond Viault was appointed as a non-executive Director on 1 September 2006.
(b)	Sir John Sunderland was appointed as non-executive Chairman on 25 August 2005. Table three shows his gains on share plans arising out of awards made whilst he was an executive Director. Other benefits relate to the provision of a car and chauffeur.
(c)	None of the non-executives (other than Sir John Sunderland) received any other emoluments during the 2006 financial year.

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Directors' and CEC members' interests in the Long-Term Incentive Plan (table five)

	Interest in shares at 1 January 2006 (or date of appointment if later) (a)	Interest in shares awarded in 2006 (b)	Shares vested (c)	Interest in shares lapsed (d)	Interest in shares as at 31 December 2006 (or date of resignation if earlier) (e)	Dividend Shares awarded and vesting (c)
Ken Hanna	328,875	164,028	95,520	42,714	354,669	7,438
Bob Stack	447,206	139,714	87,774	103,004	396,142	6,834
Todd Stitzer	740,900	260,484	162,567	158,263	680,554	12,659
Sir John Sunderland (f)	618,173	-	101,789	169,623	346,761	7,926
CEC members	1,648,231	652,082	318,980	324,147	1,657,186	24,836

Notes

(a)	Interests as at 1 January 2006 are potential interests shown at their maximum number in respect of the extended 2001-2003 and the 2002-2004 cycles, and the 2003-2005, 2004-2006 and 2005-2007 cycles.
(b)	The interests in shares awarded in 2006 relate to the 2006-2008 cycle. The mid-market price on 7 April 2006 when these awards were made was £5.61. View the criteria under which these awards would vest in full.
(c)	Shares vested on 4 March 2007 were in respect of the 2004-2006 cycle and include those deferred into trust for a further two years and (shown separately) shares which were awarded and vested in respect of dividends paid during the performance period, in accordance with ABI guidelines. The shares deferred into trust will only vest if the participant fulfils specified employment conditions during that time. If they do vest, a further award of shares will vest in respect of the dividends paid on these shares while they have been in trust, calculated on a similar basis. The mid-market price on 4 March 2007 was £5.41. On 5 March 2007, the following individuals disposed of ordinary shares which vested under the 2004-2006 cycle of the Company's Long Term Incentive Plan on 4 March 2007, the price received in each case being £5.28 per share: Sir John Sunderland - 109,715 shares; Bob Stack - 20,848 shares; Todd Stitzer - 38,614 shares.
(d)	All interests in shares in respect of the 2001-2003 cycle lapsed at the end of the financial year as did that part of the 2004-2006 cycle which did not vest.
(e)	Interests as at 31 December are potential interests shown at their maximum number in respect of the extended 2002-2004 and 2003-2005 cycles, and the 2005-2007 and 2006-2008 cycles. View the current status of each cycle. At the present time it is anticipated that no cycle will vest at maximum.
(f)	Sir John Sunderland's employment ceased on 24 August 2005 and consequently a proportion of his outstanding LTIP awards lapsed in accordance with the rules of the plan.
(g)	All awards are in shares. Qualifying conditions for the awards shown above have to be fulfilled by 31 December 2008 at the latest.

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Executive Directors' and CEC members' performance related interests in the Bonus Share Retention Plan (table six)

This table shows the maximum performance related matching award granted to each Director in respect of the investment made by the Director of his AIP award in the BSRP.

	Maximum performance related award in respect of 2004 and 2005	Maximum performance related award in respect of 2006(b)	Shares vested in 2006	Interest in shares lapsed in 2006	Total of maximum performance related awards in respect of 2004 to 2006(c)
Ken Hanna	106,439	45,768	–	–	152,207
Bob Stack	87,748	38,515	–	–	126,263
Todd Stitzer	160,566	71,809	–	–	232,375
CEC members	316,786	175,284	–	–	492,070

Notes

(a)	The monetary value of the service-related awards for the 2006-2008 cycle (in respect of 2005 AIP) and for the 2007-2009 cycle (in respect of 2006 AIP) is included in the AIP/BSRP awards shown in tables one and two. The interests shown in this table are performance related awards shown at their maximum number in respect of the 2005-2007, 2006-2008 and 2007-2009 cycles. Performance related matching awards are made in March in respect of the previous year's AIP investment (i.e. in March 2007 for 2006 AIP). Shares purchased by Directors for the 2007-2009 cycle using their AIP investment were acquired on 5 March 2007 at a price of £5.546 per share as follows: Ken Hanna - 76,280 shares, Bob Stack - 64,193 shares, Todd Stitzer - 119,681 shares. The service related awards for this cycle are: Ken Hanna - 30,512 shares, Bob Stack - 25,677 shares, Todd Stitzer - 47,872 shares.
(b)	The mid-market price on 4 March 2007 when these awards were made was £5.41. Qualifying conditions for these awards are set out on page 58.
(c)	All awards are in shares. Qualifying conditions for the awards shown above have to be fulfilled by 31 December 2009 at the latest.

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Executive Directors' pensions and retirement benefit arrangements (table seven)

	Accrued pension at 1 January 2007 £000	Increase in accrued pension during the year £000	Transfer value of accrued pension at 1 January 2007 £000	Transfer value of accrued pension at 1 January 2006 £000	Increase in accrued pension during the year (net of inflation) £000	Transfer value of the increase in accrued pension (net of inflation) less Directors' contributions £000	Transfer value of the increase in accrued pension (net of inflation) less Directors' contributions £000
US pension arrangements
Bob Stack	360	70	3,370	2,596	774	64	602
Todd Stitzer	737	189	6,337	4,506	1,831	179	1,535

Notes

(a)	The pension arrangements for Bob Stack and Todd Stitzer are made in US dollars and converted, for the purpose of this table only, at the rate of US$1.959 = £1.
(b)	Ken Hanna receives an amount equal to 30% of his base salary in lieu of a pension contribution.
(c)	The accrued pensions represent the amount of the deferred pension that would be payable from the member's normal retirement date on the basis of leaving service at the relevant date.
(d)	The transfer values have been calculated in accordance with the guidance note GN11: Retirement Benefit Schemes - Transfer values published by the Institute of Actuaries and Faculty of Actuaries, and by reference to investment market conditions at the relevant date. Under the Stock Exchange Listing Rules, the transfer value of the increase in accrued pension has been calculated using investment conditions at the date of retirement.
(e)	The aggregate amount set aside in 2006 to provide for pensions and post retirement medical benefits for the executive Directors and CEC members was £1.045m. This consists of approved pension arrangements of £0.728m, unapproved pension arrangements of £0.313m and post medical retirement benefits of £0.003m. Arrangements made in US dollars were converted at a rate of US$1.959 = £1.

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Directors' and CEC members' options over ordinary shares of 12.5p each (table eight)

Name of Director and Scheme	As at 1 January 2006 (or date of appoint- ment if later)	Exer-cised (e)	As at 31 December 2006 (or date of resig- nation if later)	Exercise price £	Market price at exercise date £	Gain made on exercise £000(i)	Exer-cisable from	to
Ken Hanna
SOP94 (a)	125,000	-	125,000	4.2475			27 Mar 2007	26 Mar 2014
SOP04 (b)	205,000	-	205,000	4.395			28 Aug 2007	27 Aug 2014
SOP04 (b)	200,000	-	200,000	5.255			2 Apr 2008	1 Apr 2015
SAYE (c)	4,699	-	4,699	3.5160			1 Feb 2010	31 Jul 2010
	534,699	-	534,699
Bob Stack
SOP94 (a)	250,000	-	250,000	4.09			2 Sep 2003	1 Sep 2010
SOP94 (a)	250,000	-	250,000	4.77			1 Sep 2004	31 Aug 2011
SOP94 (a)	250,000	-	250,000	4.825			24 Aug 2005	23 Aug 2012
SOP94 (a)	350,000	-	350,000	3.515			10 May 2006	9 May 2013
SOP04 (b)	177,000	-	177,000	4.395			28 Aug 2007	27 Aug 2014
SOP04 (b)	151,500	-	151,500	5.255			2 Apr 2008	1 Apr 2015
ESPP (d)	1,512	1,520	-	$6.613	5.37	2	17 Apr 2006	28 Apr 2006
	1,430,012	1,520	1,428,500			2
Todd Stitzer
SOP94 (a)	275,000	-	275,000	4.77			1 Sep 2004	31 Aug 2011
SOP94 (a)	300,000	-	300,000	4.825			24 Aug 2005	23 Aug 2012
SOP94 (a)	500,000	-	500,000	3.515			10 May 2006	9 May 2013
SOP04 (b)	327,000	-	327,000	4.395			28 Aug 2007	27 Aug 2014
SOP04 (b)	284,000	-	284,000	5.255			2 Apr 2008	1 Apr 2015
	1,686,000	-	1,686,000
Sir John Sunderland (g)
SOP94 (a)	200,000	200,000	-	4.77	5.85	216	1 Sep 2004	24 Aug 2006
SOP94 (a)	500,000	500,000	-	4.825	5.41-5.85	425	24 Aug 2005	24 Aug 2006
SAYE (c)	3,117	3,117	-	3.248	5.50	7	1 Feb 2006	31 July 2006
	703,117	703,117	-			648
CEC members	4,249,883	512,302	3,609,459	3.34	5.51	1,108	28 Sep 1999	25 Nov 2015

Notes

(a)	Share Option Plan 1994.
(b)	Share Option Plan 2004.
(c)	Savings-Related Share Option Scheme 1982.
(d)	US and Canada Employee Stock Purchase Plan 1994. Under the rules of this Plan, interest which accrues on the money saved can also be used to purchase shares at the option price.
(e)	No options lapsed during the year and no options were granted during the year in respect of Directors. 139,000 options lapsed when a CEC member left the Group and 10,878 options in all-employee plans were granted to CEC members.
(f)	No payment was made on the granting of any of these options.
(g)	Non-executive Directors are not granted share options. Sir John Sunderland had until 24 August 2006 to exercise his remaining share options following his retirement as an employee.
(h)	The market price of an ordinary share on 29 December 2006 (the last dealing day in the financial year) was £5.46. The highest and lowest market prices of an ordinary share in the year were £5.90 and £4.99 respectively.
(i)	Where some or all of the shares were sold immediately after the exercise of an option, the gain shown is the actual gain made by the Director or CEC member. If some or all of the shares were retained, the gain is a notional gain calculated using the market price on the date of exercise. When an option was exercised or shares were sold in parts on a number of different days in the year, the gain shown is the aggregate gain from all those exercises.

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Share ownership (table nine)

	As at 1 January 2006 (or date of appointment if later)	As at 31 December 2006 (or date of resignation if earlier)	As at 9 March 2007 (unaudited)
Sanjiv Ahuja (a)	877	2,287	3,693
Wolfgang Berndt	76,072	81,439	82,939
Rick Braddock	47,528	55,152	56,916
Roger Carr	38,423	47,368	49,755
Ken Hanna (b)(c)	378,143	499,260	678,552
Lord Patten	1,021	5,448	6,698
Bob Stack (c)	764,725	838,558	890,248
Todd Stitzer (c)	551,835	611,000	822,331
Sir John Sunderland (c)	938,658	939,075	939,075
David Thompson	39,825	45,610	47,201
Rosemary Thorne	4,564	9,035	10,285
Raymond Viault (a)	-	9,736	11,328
Baroness Wilcox (d)	27,343	33,291	N/A
CEC members (c) (e)	1,132,326	1,496,139	1,862,486

Notes

(a)	Sanjiv Ahuja was appointed as a non-executive Director on 19 May 2006 and Raymond Viault was appointed as a non-executive Director on 1 September 2006.
(b)	Ken Hanna's shareholding includes an award of 225,000 restricted shares, vesting in three tranches of 75,000 shares each in March 2007, 2008 and 2009 if he is still employed by the Company at that time.
(c)	Holdings of ordinary shares include shares awarded under the BSRP and the all-employee share incentive plan and LTIP shares held in trust. The following executive Directors sold shares which vested under the 2004-2006 BSRP cycle on 4 March 2007: Bob Stack 20,070 shares at a price of £5.28 per share; Todd Stitzer: 81,174 shares at a price of £5.28 per share.
(d)	Baroness Wilcox retired as a non-executive Director on 31 December 2006.
(e)	Shareholdings of CEC members also include restricted share awards, the release of which is dependent upon specified performance conditions.
(f)	To accurately reflect the share ownership for each Director, as shown in the Register of Directors' Interests (maintained under Section 325 of the Companies Act 1985), the holdings for each Director in tables eight and nine should be added together.

The following executive Directors had interests in the Common Stock of US$0.01 each of Dr Pepper/Seven Up Bottling Group, Inc (DPSUBG) (the holding company of the Group's American bottling operations) prior to the acquisition of all the shares in DPSUBG by a Group subsidiary on 2 May 2006:

Bob Stack	250
Todd Stitzer	2,500

These shares were purchased at the same price ($125 per share) as that paid for all the other shares in DPSUBG not already owned by the Group.

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