During the three months and year ended December 31, 2011, the Company recorded charges of $40 million and $119 million, respectively, associated with the integration of our German bottling and distribution operations as well as other restructuring initiatives outside the scope of our productivity initiatives and the integration of Coca-Cola Enterprises Inc.’s (“CCE”) former North America business. These restructuring charges were recorded in the line item other operating charges. See below for a discussion of our productivity and CCE integration initiatives.

Productivity and Reinvestment

During the three months and year ended December 31, 2012, the Company recorded charges of $93 million and $270 million, respectively, in the line item other operating charges related to our productivity and reinvestment program which was announced in February 2012. This program will further enable our efforts to strengthen our brands and reinvest our resources to drive long-term profitable growth. The first component of this program is a new global productivity initiative focused around four primary areas: global supply chain optimization; global marketing and innovation effectiveness; operating expense leverage and operational excellence; and data and information technology systems standardization.

The second component of our productivity and reinvestment program involves a new integration initiative in North America related to our acquisition of CCE’s former North America business. The Company has identified incremental synergies in North America, primarily in the area of our North American product supply operations, which will better enable us to serve our customers and consumers.

As a combined productivity and reinvestment program, the Company anticipates generating annualized savings of $550 million to $650 million which will be phased in over four years starting in 2012. We expect to begin fully realizing the annual benefits of these savings in 2015, the final year of the program.

Productivity Initiatives

During the three months and year ended December 31, 2012, the Company reversed charges of $1 million and $10 million, respectively, related to previously established accruals associated with our 2008-2011 productivity initiatives. These reversals were recorded in the line item other operating charges.

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