*No market exists for the Class B Common Stock, which is neither registered under Section 12 of the Act nor subject to Section 15(d) of the Act. The Class B Common Stock is convertible into Common Stock on a share-for-share basis at the option of the holder.

Indicate the number of shares outstanding of each of the registrant’sregistrant's classes of common stock, as of the latest practicable date.

Documents Incorporated by Reference

Table of Contents

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PART I

Introduction

Introduction

Coca-Cola Bottling Co. Consolidated, a Delaware corporation (together with its majority-owned subsidiaries, the “Company”“Company,” “we” or “us”), produces, markets and distributes nonalcoholic beverages, primarily products of The Coca-Cola Company, Atlanta, Georgia (“The Coca-Cola Company”), which include some of the most recognized and popular beverage brands in the world. The Company which was incorporated in 1980, and its predecessors have been in the nonalcoholic beverage manufacturing and distribution business since 1902. The Company isWe are the largest independent Coca-Cola bottler in the United States.

In

We hold various agreements under which we produce, distribute and market sparkling beverages of The Coca-Cola Company, still beverages of The Coca-Cola Company such as POWERade, vitaminwater, Minute Maid Juices To Go and Dasani water products, and various other products, including Dr Pepper, Sundrop and Monster Energy products. Historically, our operational footprint included markets located in North Carolina, South Carolina, south Alabama, south Georgia, central Tennessee, western Virginia and West Virginia (the “Legacy Territories”).

Since April 2013, as part of The Coca-Cola Company’s plans to refranchise a substantial portion of its North American bottling territories, the Company andwe have engaged in a series of transactions with The Coca-Cola Company signed a nonbinding letter of intent to expand the geographic regions served by the Company with the Company acquiring the rights to serve certain markets in Tennessee, Kentucky and Indiana previously served by Coca-Cola Refreshments, USA, Inc. (“CCR”), a wholly-owned subsidiary of The Coca-Cola Company, (individually an “Expansion Territory” and collectively,to expand our distribution operations significantly through the acquisition both of rights to serve additional distribution territories previously served by CCR (the “Expansion Territories”). Beginning in May 2014, the Company has entered into a series and of transactions with CCR (four of which have been completed and the remaining two of which are expected to be completed in Spring 2015) to allow the Company to take over serving therelated distribution assets (the “Distribution Expansion Territories.Transactions”). The Company’s rights to distribute and market beverage products of The Coca-Cola Company in the Expansion Territories (with limited exceptions) are governed exclusively by a Comprehensive Beverage Agreement (“CBA”)entered into at each closing for each Expansion TerritoryTerritories and are different from the rights the Company holdswe hold under agreements with The Coca-Cola Company to serve the markets located in North and South Carolina, South Alabama, South Georgia, Central Tennessee, Western Virginia and West Virginia the Legacy Territories.

The Company has previously served and is continuing to serve (individually, a “Legacy Territory” and collectively,acquired the “Legacy Territories”).

Thefollowing Expansion Territories and their actual or expected closing dates are as follows:of January 3, 2016:

As

In addition to expanding our distribution territory, in September 2015 and February 2016, we announced our intention to engage in a series of December 28, 2014,transactions with The Coca-Cola Company had aand CCR to purchase seven manufacturing facilities (the “Expansion Manufacturing Facilities”) and related assets (the “Manufacturing Facility Expansion Transactions” and, together with the Distribution Expansion Transactions, the “Expansion Transactions”).

As of January 3, 2016, The Coca-Cola Company owned approximately 34.8% interest in the Company’sof our outstanding Common Stock,common stock, representing approximately 5.0% of the total voting power of the Company’s Common Stockour common stock and Class B Common Stockcommon stock voting together as a single class. The Coca-Cola Company does not own any shares of our Class B Common Stock of the Company.common stock.  J. Frank Harrison, III, the Company’s Chief Executive Officer and Chairman of the Company’s Board and Chief Executive Officer,of Directors (the “Board”), currently owns or controls approximately 86% of the combined voting power of the Company’s outstanding Common Stockcommon stock and Class B Common Stock.common stock as of January 3, 2016.

GeneralBeverage Products

Nonalcoholic beverage products that we produce, market and distribute can be broken down into two categories:

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Sales of sparkling beverages were approximately 81%80%, 82%81% and 82% of total net sales for fiscal 2015 (“2015”), fiscal 2014 (“2014”), and fiscal 2013 (“2013”) and fiscal 2012 (“2012”), respectively. Sales of still beverages were approximately 19%20%, 18%19%, and 18% of total net sales for 2015, 2014 and 2013, and 2012, respectively.

The Company holds Cola Beverage Agreements and Allied Beverage Agreements under which it produces, distributes and markets, in certain regions comprising the Legacy Territories, sparkling beverages of TheCoca-Cola Company. The Company also holds Still Beverage Agreements under which it distributes and markets in certain regions comprising the Legacy Territories still beverages of The Coca-Cola Company such as POWERade, vitaminwater and Minute Maid Juices To Go and produces, distributes and markets Dasani water products. For those regions comprising the Expansion Territories (except the Lexington, Kentucky region), the Company has entered into or will enter into CBAs authorizing the Company to distribute and market in those regions both sparkling beverages and still beverages of The Coca-Cola Company.

The Company holds agreements to produce, distribute and market Dr Pepper in some of the regions comprising the Legacy Territories. The Company also distributes and markets various other products, including Monster Energy products and Sundrop, in one or more of the Company’s regions, including, in the case of Monster Energy products, some of the Expansion Territories, under agreements with the companies that hold and license the use of their trademarks for these beverages. In addition, the Company produces beverages for other Coca-Cola bottlers. In some instances, the Company distributes beverages in the Legacy Territories without a written agreement.

The Company’s principal sparkling beverage is Coca-Cola. In each of the last three fiscal years, sales of products bearing the      “Coca-Cola” or “Coke” trademark have accounted for more than half of the Company’sour bottle/can volume to retail customers. In total, products of The Coca-Cola Company accounted for approximately 87%, 88% and 88% of the Company’sour bottle/can volume to retail customers during 2015, 2014 and 2013, and 2012.respectively.  

The Company offers

We offer a range of flavors designed to meet the demands of the Company’sour consumers.  The main packaging materials for the Company’sour beverages are plastic bottles and aluminum cans. In addition, the Company provideswe provide restaurants and other immediate consumption outlets with fountain products (“post-mix”). Fountainor “post-mix” products. Post-mix products are dispensed through equipment that mixes the fountain syrup with carbonated or still water, enabling fountain retailers to sell finished products to consumers in cups or glasses.

The

Prior to August 2015, a subsidiary of the Company has alsohad developed certain beverage products which the Company, CCR and certain other Coca-Cola franchise bottlers marketed and distributed certain products which it owns.in the territories they served. These products includeincluded Tum-E Yummies, a vitamin-C enhanced flavored drink, and Fuel in a Bottle power shots. We sold this subsidiary to The Coca-Cola Company markets and sells these products nationally. CCR distributes Tum-E Yummies nationally. Certain otherCoca-Cola franchise bottlers alsoin August 2015, but we continue to distribute Tum-E Yummies in the regions theyterritories we serve. In the non-binding letter of intent the Company and The Coca-Cola Company signed in April 2013, the parties set forth their intent to agree on the terms of the future purchase by The Coca-Cola Company of the Company’s subsidiary that develops, sells and markets these branded products. The Company and The Coca-Cola Company are currently negotiating but have not reached final agreement on the terms of the proposed purchase agreement.

The following table sets forth some of the Company’sour most important products, including both products that both The Coca-Cola Company and other beverage companies have licensed to the Company and products that the Company owns.us.

Beverage Agreements for Legacy Territories

The Company holds

We hold a number of contracts with The Coca-Cola Company which entitle the Companyus to produce, market and distribute in the Company’s Legacy Territories The Coca-Cola Company’s nonalcoholic beverages in bottles, cans and five gallon pressurized pre-mix containers. The Company hasWe have similar arrangements for the Company’s Legacy Territories with Dr Pepper Snapple Group, Inc. and other beverage companies.companies for the Legacy Territories. For the Expansion Territories, acquired in 2014, the Company holds its rights to market and distribute The Coca-Cola Company’s nonalcoholic beverages under a CBA for each Expansion TerritoryComprehensive Beverage Agreements that doesdo not include the right to produce such beverages. Instead, the Company and CCR have entered into a Finished Goods Supply Agreement for each Expansion Territory pursuantThe beverage agreements pertaining to which the Company purchases from CCR substantially all of the Company’s requirements for The Coca-Cola Company’s nonalcoholic beverages and related products and for the cross-licensed brands the Company has the right to market and distribute in such Expansion Territory. The CBA and the Finished Goods Supply Agreement for the Expansion Territories are described below following the description of the contracts for the Legacy Territories under the heading “Beverage Agreements with The Coca-Cola Company for the Expansion Territories” and “Beverage Agreements with Other Licensors for the Expansion Territories.”

Cola and Allied Beverage Agreements with The Coca-Cola Company for the Legacy Territories.

The Company purchasesWe purchase concentrates from The Coca-Cola Company and produces, marketsproduce, market and distributesdistribute its principal sparkling beverages within itsin the Legacy Territories under two basic forms of beverage agreements with The Coca-Cola Company: (i) beverage agreements that cover sparkling beverages bearing the trademark “Coca-Cola” or “Coke” (the “Coca-Cola Trademark Beverages” and “Cola Beverage Agreements”), and (ii) beverage agreements that cover other sparkling beverages of The Coca-Cola Company (the “Allied Beverages” and “Allied Beverage Agreements”) (referred or collectively referred to collectively in this report as the “Cola and Allied Beverage Agreements”), although in some instances the Company distributes sparkling beverages without a written agreement.. The Company is a party to Cola Beverage Agreements and Allied Beverage Agreements for various specified Legacy Territories.

We also purchase as finished goods and distribute certain still beverages, such as sports drinks and juice drinks, from The Coca-Cola Company (or its designees or joint ventures), and produce, market and distribute Dasani water products, pursuant to the terms of marketing and distribution agreements applicable to the Legacy Territories (the “Still Beverage Agreements”).

Cola Beverage Agreements with The Coca-Cola Company for the Legacy Territories.

Exclusivity.

The Cola Beverage Agreements for the Legacy Territories provide that the Companywe will purchase itsour entire requirements of concentrates or syrups for Coca-Cola Trademark Beverages from TheCoca-Cola Company at prices, terms of payment, and other terms and conditions of supply determined from time-to-time by The Coca-Cola Company at its sole discretion. The Company may not produce, distribute,discretion and prohibit us from producing, distributing, or handlehandling cola products other than those of The Coca-Cola Company. The Company hasWe have the exclusive right to manufacture and distribute Coca-Cola Trademark Beverages for sale in authorized containers within itsin the Legacy Territories. The Coca-Cola Company may determine, at its sole discretion, what types of containers are authorized for use with products of The Coca-Cola Company.its products. The Company may not sell Coca-Cola Trademark Beverages outside itsof the Legacy Territories except by agreement with The Coca-Cola Company.

Company Obligations.    The Company is

We are obligated, among other things, to:

The Company isWe are required to meet annually with The Coca-Cola Company to present itsour marketing, management, and advertising plans for the Coca-Cola Trademark Beverages for the upcoming year, including financial plans showing that the Company haswe have the consolidated financial capacity to perform itsour duties and obligations to The Coca-Cola Company. The Coca-Cola Company may not unreasonably withhold approval of such plans. If the Company carrieswe carry out itsthese plans in all material respects, the Companywe will be deemed to have satisfied the Company’sour obligations to develop, stimulate, and satisfy fully the demand for the Coca-Cola Trademark Beverages and to maintain the requisite financial capacity for the period of time covered by the plan. Failure to carry out such plans in all material respects would constitute an event of default that, if not cured within 120 days of written notice of the failure, would give The Coca-Cola Company the right to terminate the Cola Beverage Agreements. If the Company, at any time failswe fail to carry out a plan in all material respects in any geographic segment of itsthe Legacy Territories, as defined by The Coca-Cola Company, and if such failure is not cured within six months of written notice of the failure, The Coca-Cola Company may reduce the territory covered by that Cola Beverage Agreement by eliminating the portion of the territory in which such failure has occurred.

The Coca-Cola Company has no obligation under the Cola Beverage Agreements to participate with the Companyus in expenditures for advertising and marketing. As it has in the past, The Coca-Cola Company may contribute to such expenditures and undertake independent advertising and marketing activities, as well as advertising and sales promotion programs which require mutual cooperation and financial support of the Company. The future levels of marketing funding support and promotional funds provided by The Coca-Cola Company may vary materially from the levels provided during the periods covered by the information included in this report.prior years.

Acquisition of Other Bottlers.

If the Company acquireswe acquire control, directly or indirectly, of any bottler of Coca-Cola Trademark Beverages, or any party controlling a bottler of Coca-Cola Trademark Beverages, the Companywe must cause the acquired bottler to amend its agreement for the Coca-Cola Trademark Beverages to conform to the terms of the Cola Beverage Agreements.

Term and Termination.    The Cola Beverage Agreements are perpetual, but they are subject to termination by The Coca-Cola Company upon the occurrence of an event of default by the Company. Events of default with respect to each Cola Beverage Agreement include:

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If any Cola Beverage Agreement is terminated because of an event of default, The Coca-Cola Company has the right to terminate all other Cola Beverage Agreements the Company holds.to which we are a party.

No Assignments.    The Company is

We are prohibited from assigning, transferring or pledging itsour Cola Beverage Agreements or any interest therein, whether voluntarily or by operation of law, without the prior consent of The Coca-Cola Company.

Allied Beverage Agreements with The Coca-Cola Company for the Legacy Territories.

The Allied Beverages are beverages of The Coca-Cola Company or its subsidiaries that are sparkling beverages, but not Coca-Cola Trademark Beverages.

The Allied Beverage Agreements contain provisions that are similar to those of the Cola Beverage Agreements with respect to the sale of beverages outside itsthe Legacy Territories, authorized containers, planning, quality control, transfer restrictions and related matters, but have certain significant differences from the Cola Beverage Agreements.

Exclusivity.  Under the Allied Beverage Agreements, the Company haswe have exclusive rights to distribute the Allied Beverages in authorized containers in specified Legacy Territories. LikeSimilar to the Cola Beverage Agreements, the Company haswe have advertising, marketing, and promotional obligations, but without restriction for most brands as to the marketing of products with similar flavors, as long as there is no manufacturing or handling of other products that would imitate, infringe upon, or cause confusion with, the products of The Coca-Cola Company. The Coca-Cola Company has the right to discontinue any or all Allied Beverages, and the Company has a right, but not an obligation, under the Allied Beverage Agreements to elect to market any new beverage introduced by The Coca-Cola Company under the trademarks covered by the respective Allied Beverage Agreements.

Term and Termination.    

Allied Beverage Agreements have a term of 10 years and are renewable by the Companyat our option for an additional 10 years at the end of each term. Renewal is at the Company’s option. The Company currently intendsWe intend to renew substantially all of the Allied Beverage Agreements as they expire. The Allied Beverage Agreements are subject to termination in the event of default by the Company. The Coca-Cola Company may terminate an Allied Beverage Agreement in the event of:

Supplementary Agreement Relating to Cola and Allied Beverage Agreements with The Coca-Cola Company for the Legacy Territories.

The Company and The Coca-Cola Company are also parties to a Letter Agreement (the “Supplementary Agreement”) that supplements or modifies some of the provisions of the Cola and Allied Beverage Agreements. The Supplementary Agreement provides that The Coca-Cola Company will:

The Supplementary Agreement also permits transfers of the Company’sour capital stock that would otherwise be limited by the Cola and Allied Beverage Agreements.

Impact of Territory Conversion Agreement on Cola and Allied Beverage Agreements

Nearly all of our Cola and Allied Beverage Agreements are subject to being amended, restated and converted into a Final CBA pursuant to the Territory Conversion Agreement described below, as disclosed in the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on September 28, 2015.

Pricing of Coca-Cola Trademark Beverages and Allied Beverages in the Legacy Territories.

Pursuant to the Cola and Allied Beverage Agreements, except as provided in the Supplementary Agreement and the Incidence Pricing Agreement (described below),in incidence-based pricing agreements, The Coca-Cola Company establishes the prices charged to the Company for concentrates of Coca-Cola Trademark Beverages and Allied Beverages. The Coca-Cola Company has no rights under the beverage agreements to establish the resale prices at which the Company sellswe sell its products.

Since 2008, however, the Company has been purchasingwe have purchased concentrate from The Coca-Cola Company for all sparkling beverages for which the Company purchaseswe purchase concentrate from The Coca-Cola Company under an incidence-based pricing arrangement and hashave not purchased concentrates at standard concentrate prices as was the Company’sour practice in prior years. During the two-year term of the currentour incidence-based pricing agreement that will endended on December 31, 2015, the pricing of such concentrate will continue to bewas governed by the incidence-based pricing model rather than the Cola and Allied Beverage Agreements for the Legacy Territories. Under the incidence-based pricing model, the concentrate price The Coca-Cola Company charges is impacted by a number of factors, including the incidence rate in effect, the Company’sour pricing and sales of finished products, the channels in which the finished products are sold and package mix. We expect to enter into a similar incidence-based pricing agreement with The Coca-Cola Company during fiscal 2016.

Still Beverage Agreements with The Coca-Cola Company for the Legacy Territories.

The Company purchases as finished goods and distributes certain still beverages, such as sports drinks and juice drinks, from The Coca-Cola Company, or its designees or joint ventures, and produces, markets and distributes Dasani water products, pursuant to the terms of marketing and distribution agreements applicable to the Legacy Territories (the “Still Beverage Agreements”). In some instances the Company distributes certain still beverages in the Legacy Territories without a written agreement.

The Still Beverage Agreements for the Legacy Territories contain provisions that are similar to the Cola and Allied Beverage Agreements with respect to authorized containers, planning, quality control, transfer restrictions and related matters, but have certain significantmaterial differences.

Exclusivity. Unlike the Cola and Allied Beverage Agreements, which grant the Companyus exclusivity in the distribution of the covered beverages in itsthe Legacy Territories, the Still Beverage Agreements grant exclusivity but permit The Coca-Cola Company to test-market the still beverage products in the Company’s Legacy Territories, subject to the Company’sour right of first refusal, and to sell the still beverages to commissaries

for delivery to retail outlets in the Company’s Legacy Territories where still beverages are consumed on-premises, such as restaurants. The Coca-Cola Company must pay the Companyus certain fees for lost volume, delivery, and taxes in the event of such commissary sales. Approved alternative route to market projects undertaken by the Company, The Coca-Cola Company, and other bottlers of Coca-Cola products would, in some instances, permit delivery of certain products of The Coca-Cola Company into the territories of almost all bottlers, in exchange for compensation in most circumstances, despite the terms of the beverage agreements making such territories exclusive. Also, under the Still Beverage Agreements for the Legacy Territories, the Companywe may not sell other beverages in the same product category.

Pricing.    

The Coca-Cola Company, at its sole discretion, establishes the prices the Companywe must pay for the still beverages purchased as finished goods or, in the case of Dasani, the concentrate or finished goods, but has agreed, under certain circumstances for some products, to give the benefit of more favorable pricing if such pricing is offered to other bottlers of Coca-Cola products.

Term.    

Each of the Still Beverage AgreementsAgreement for the Company’s Legacy Territories has a term of 10 or 15 years and is renewable by the Companyat our option for an additional 10 years at the end of each term. The Company currently intendsWe intend to renew substantially all of the Still Beverage Agreements as they expire.

Nearly all of our Still Beverage Agreements are subject to being amended, restated and converted into a Final CBA in the future pursuant to the Territory Conversion Agreement described below, as disclosed in our Current Report on Form 8-K filed with the SEC on September 28, 2015.

Other Beverage Agreements with The Coca-Cola Company.Company

The Company has

We have entered into a distribution agreement with Energy Brands, Inc. (“Energy Brands”), a wholly owned subsidiary of The Coca-Cola Company. Energy Brands, also known as glacéau, is a producer and distributor of branded enhanced water products including vitaminwater and smartwater (still beverage products), and fruitwater (a sparkling water drink). The agreement has a term of 10 years and will automatically renewrenews for succeeding 10-year terms, subject to a 12-month nonrenewal notification by the Company. The agreement covers most of the Company’s Legacy Territories, requires the Companyus to distribute Energy Brands enhanced water products exclusively, and permits Energy Brands to distribute the products in some channels within the Company’s Legacy Territories.

The Company

Nearly all of our agreements with Energy Brands are subject to being amended, restated and converted into a Final CBA in the future pursuant to the Territory Conversion Agreement described below, as disclosed in our Current Report on Form 8-K filed with the SEC on September 28, 2015.

We also sellssell Coca-Cola and other post-mix products of The Coca-Cola Company on a non-exclusive basis. The Coca-Cola Company establishes the prices charged to the Companyus for its post-mix products of The Coca-Cola Company.products. In addition, the Company produceswe produce some products for sale to other Coca-Cola bottlers and CCR. These sales have lower margins but allow the Companyus to achieve higher utilization of itsour production equipment and facilities.

The Company entered into an agreement with The Coca-Cola Company in 2008 regarding brand innovation and distribution collaboration. Under the agreement, the Company grants The Coca-Cola Company the option to purchase any nonalcoholic beverage brands owned by the Company. The option is exercisable as to each brand at a formula-based price during the two-year period that begins after that brand has achieved a specified level of net operating revenue or, if earlier, beginning five years after the introduction of that brand into the market with a minimum level of net operating revenue, with the exception that with respect to brands owned at the date of the letter agreement, the five-year period does not begin earlier than the date of the letter agreement. In the non-binding letter of intent the Company and The Coca-Cola Company signed in April 2013, the parties set forth their intent to agree on the terms of the future purchase by The Coca-Cola Company of the Company’s subsidiary that develops, sells and markets these nonalcoholic beverage brands owned by the Company. The Company and The Coca-Cola Company are currently negotiating, but have not reached final agreement on, the terms of the proposed purchase agreement.

Beverage Agreements with Other Licensors for the Legacy Territories.

The Company has

We have beverage agreements for the Legacy Territories with Dr Pepper Snapple Group, Inc. for Dr Pepper and Sundrop brands which are similar to those for the Cola and Allied Beverage Agreements for the Legacy Territories. These beverage agreements are perpetual in nature but may be terminated by the Companyus upon 90 daysdays’ notice. The price for syrup or concentrate is set by the beverage companies from time to time.

These beverage agreements also contain similar restrictions on the use of trademarks, approved bottles, cans and labels and sale of imitations or substitutes as well as termination for cause provisions. The CompanyWe also sellssell post-mix products of Dr Pepper Snapple Group, Inc.

The Company has been purchasing as finished goods and distributing certain Monster brand energy drink products since 2007 in portions of its Legacy Territories under

In 2015, we also signed a new distribution agreement with Monster Energy Company (“MEC”). The agreement contains provisions that are similarsubstantially expanded the territory where we have rights to the Cola and Allied Beverage Agreements with respect to pricing, promotion, planning, territory and trademark restrictions, transfer restrictions, and related matters as well as termination for cause provisions. The agreement has a 20 year term and will renew automatically. The agreement may be terminated without cause by either party. However, any such termination by MEC requires compensation in the form of severance payments to the Company. In December 2014, the Company entered into an agreement with The Coca-Cola Company (acting through its Coca-Cola North America Division) whereby The Coca-Cola Company has consented to the Company distributing Monster branddistribute energy drink products inoffered, packaged and/or marketed by Monster Energy Company under the primary brand name “Monster” so that portion ofit now includes the Company’s Legacy and Expansion Territories wheresame geographic territory the Company does not currently distribute them pursuant to a newservices for the distribution agreement the Company and MEC are currently negotiating. See Item 13. Certain Relationships and Related Transactions, and Director Independence in Part III of this Annual Report on Form 10-K for more information about the December 2014 agreement withbeverage products of The Coca-Cola Company and the proposed new Monster brand energy drink products distribution agreement.Company.

The territories covered by beverage agreements with other licensors for the Legacy Territories are not always aligned with the Legacy Territories covered by the Cola and Allied Beverage Agreements but are generally within those territory boundaries. Sales of beverages by the Company under these other agreements in the Legacy Territories represented approximately 12%13% of the Company’sour bottle/can volume to retail customers for each of 2015, 2014 2013 and 2012.2013.

The Expansion TerritoriesTransactions

Beginning in May 2014, the Company has entered intowe engaged in a series of transactions involving executionDistribution Territory Expansion Transactions with The Coca-Cola Company and CCR. Each of multiple CBAs under whichthe principal asset purchase agreements we entered into for Distribution Territory Expansion Transactions (the “Distribution Asset Purchase Agreements”) provided for us to (a) purchase from CCR has granted(i) certain rights relating to the distribution, promotion, marketing and sale of certain beverage brands not owned or licensed by The Coca-Cola Company exclusive distribution rights(“cross-licensed brands”) but then distributed by CCR in severalthe applicable portion of the Expansion Territories for brands owned by The Coca-Cola Company in exchange for the Company’s obligation to make quarterly sub-bottling payments on an ongoing basis to CCR. These Expansion Territories include Johnson City and Morristown, Tennessee, Knoxville, Tennessee, Cleveland and Cookeville, Tennessee and Louisville, Kentucky and Evansville, Indiana and the surrounding regions. Contemporaneous with the signing of each CBA, the Company also acquired CCR’s rights to distribute in each Expansion Territory beverage brands that are not owned by The Coca-Cola Company (the “cross-licensed brands”) and substantially all the(ii) certain assets of CCR related to the distribution, promotion, marketing and sale of both The Coca-Cola Company brands and cross-licensed brands then distributed by CCR in the applicable portion of the Expansion Territory. The Company did not acquire fromTerritories (collectively, “Transferred Assets”), and (b) assume certain liabilities and obligations of CCR any production assets or rightsrelating to produce beverages for distribution in anythe business acquired. At each of these Expansion Territories. Instead, with certain limited exceptions,the closings under the Distribution Asset Purchase Agreements, the Company, hasCCR and The Coca-Cola Company entered into a Finished Goods Supply Agreement withcomprehensive beverage agreement (“Initial CBA”) pursuant to which CCR to purchase finished beverage productsgranted us certain exclusive rights (“CBA Rights”) to distribute, promote, market and sell the Covered Beverages and Related Products distinguished by the Trademarks (as those terms are defined in the Initial CBAs) in the applicable portion of the Expansion Territories in exchange for us agreeing to make a quarterly sub-bottling payment to CCR on a continuing basis.

In April 2013, we entered into a non-binding letter of intent with The Coca-Cola Company (the “April 2013 LOI”) for the first Distribution Territory acquired. The CBAs,Expansion Transaction, which are described further below, have termscontemplated our acquisition of ten yearsCBA Rights and are renewable for successive additional termsTransferred Assets relating to distribution territories previously served by CCR in eastern Tennessee, central Kentucky and portions of ten years each unless earlier terminated as provided in such agreements.

To further implementIndiana (the “April 2013 LOI Territories”).  From May 2014 to May 2015, we completed the acquisition of the April 2013 letterLOI Territories from CCR in a series of intent, the Companyfive asset purchase transactions and CCR have entered into anone asset exchange agreement fortransaction (the “Asset Exchange Transaction”).  In the Lexington, Kentucky Expansion Territory. The Company has agreed to exchangeAsset Exchange Transaction, we exchanged certain of itsour assets relating to the marketing, promotion, distribution and sale of Coca-Cola and other beverage products in the region currentlyterritory previously served by the Company’sour facilities and equipment located in Jackson, Tennessee, (includingincluding the rights to produce such beverages)beverages in the Jackson, Tennessee territory, for certain assets of CCR’s assetsCCR relating to the marketing, promotion, distribution and sale of Coca-Cola and other beverage products in the region currentlyportion of the April 2013 LOI Territories previously served by CCR’s facilities and equipment located in Lexington, Kentucky, (includingincluding the rights to produce such beverages).beverages in the Lexington, Kentucky territory. Our rights with respect to the Lexington, Kentucky territory are governed by Cola and Allied Beverage Agreements, Still Beverage Agreements and other agreements similar to those we have with respect to the Legacy Territories.

In May 2015, we entered into a non-binding letter of intent with The Coca-Cola Company (the “May 2015 LOI”), which contemplated our acquisition from CCR, in two phases, of additional CBA Rights and CCR anticipateTransferred Assets relating to distribution territories that include the closingmajor markets of this asset exchange agreement will occur in Spring 2015.Baltimore, Maryland; Alexandria, Norfolk and Richmond, Virginia; the District of Columbia; Cincinnati, Columbus and Dayton, Ohio; and Indianapolis, Indiana.

The Company and CCR also anticipate the

In September 2015, we entered into an asset purchase agreement with CCR (the “September 2015 APA”) for the first phase of additional Distribution Territory Expansion Transactions contemplated by the May 2015 LOI for CBA Rights and Transferred Assets

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relating to the territory currentlydistribution territories served by CCR through its facilitiesin eastern and equipment located in Paducahnorthern Virginia, most of Delaware, the entire State of Maryland, the District of Columbia, and Pikeville, Kentucky

will close in Spring 2015. Whenparts of North Carolina, Pennsylvania and West Virginia. During 2015, we closed one Distribution Territory Expansion Transaction under the Paducah/Pikeville asset purchase transactionSeptember 2015 APA providing us with CBA Rights and the Jackson-for-Lexington exchange transaction are consummated, the expansion of the geographic regionsTransferred Assets relating to distribution territories previously served by CCR in Norfolk, Fredericksburg and Staunton, Virginia and Elizabeth City, North Carolina.  We are continuing to work towards a definitive agreement with CCR for the Companyremaining Distribution Territory Expansion Transactions contemplated by the nonbindingMay 2015 LOI for CBA Rights and Transferred Assets relating to distribution territories previously served by CCR in central and southern Ohio, northern Kentucky and parts of Indiana and Illinois.

In September 2015, we entered into a non-binding letter of intent the Company andwith The Coca-Cola Company signed(the “September 2015 LOI”) which contemplated our acquisition of six regional manufacturing facilities and related assets from CCR in April 2013 willtwo phases.

In October 2015, we entered into an asset purchase agreement with CCR (the “October 2015 APA”) for the first phase of Manufacturing Facility Expansion Transactions contemplated by the September 2015 LOI which provides for our acquisition of three regional manufacturing facilities located in Sandston, Virginia; Silver Springs, Maryland; and Baltimore, Maryland. We are continuing to work towards a definitive agreement with CCR for the remaining Manufacturing Facility Expansion Transactions contemplated by the September 2015 LOI, which includes three manufacturing facilities located in Indianapolis, Indiana; Portland, Indiana; and Cincinnati, Ohio.

As part of these Expansion Transactions, we have agreed, subject to certain limited exceptions, to refrain until January 1, 2020 from acquiring or developing any line of business inside or outside of our territories governed by a Comprehensive Beverage Agreement or similar agreement without the consent of The Coca-Cola Company, which consent may not be complete.unreasonably withheld.

Beverage Agreements with The Coca-Cola Company for the Expansion Territories

Comprehensive Beverage Agreements (CBAs)

Pursuant to separatethe Initial CBAs entered into at closing for each Expansion Territory transaction completed,among the Company, has been granted certain exclusive rights to distribute, promote, marketCCR and sell brands of The Coca-Cola Company and related products in such Expansion Territory. These brands include both sparkling and still beverages. Underat each CBA,of the Company willclosings under the Distribution Asset Purchase Agreements, we are obligated to make a quarterly sub-bottling paymentpayments to CCR based on sales of certain beverages and beverage products that are sold under the same trademarks that identify a continuing basis for the grant of exclusive rights to distribute, promote, market and sell brands of The Coca-Cola Company and related products in the applicable Expansion Territory.Covered Beverage, Related Product or certain cross-licensed brands. As of December 28, 2014, the CompanyJanuary 3, 2016, we had recorded a liability of $46.9$136.6 million to reflect the estimated fair value of the contingent consideration related to future sub-bottling payments. See Note 3 and Note 12 to the consolidated financial statements for additional information.

Other than the brands of The Coca-Cola Company and related products and expressly permitted existing cross-licensed brands sold in an Expansion Territory, each Initial CBA provides that the Companywe will not be permitted to produce, manufacture, prepare, package, distribute, sell, deal in or otherwise use or handle any beverages, beverage components or other beverage products in the Expansion Territory unless otherwise consented to by The Coca-Cola Company, subject to the terms of the Ancillary Business Letter described below.Company.

The Company’s Obligations. The Company is

We are obligated under the CBA,Initial CBAs to, among other things, to:

Term and Termination.EachEach Initial CBA has a term of ten years and is renewable by the Company indefinitelyautomatically renewed for successive additional terms of ten years each unless we give notice to terminate at least one year prior to the expiration of a ten year term. The Initial CBA is earlier terminated upon the occurrence of any of the following, among other, events.

Finished Goods Supply Agreements

The grant of exclusive rights pursuant to each CBA to distribute, promote, market and sell brands of The Coca-Cola Company and related products in the applicable Expansion Territory does not include the rightsublicensed to produce such beverage products. Instead, theus, or (ii) owned by or licensed to Monster Energy Company and CCR have entered into a Finished Goods Supply Agreement for each Expansion Territory pursuant toon which the Company will purchase from CCR substantially all of the Company’s requirements in the applicable Expansion Territory for brands ofwe pay, and The Coca-Cola Company receives, a facilitation fee.

Beverage Agreements with Other Licensors for the Expansion Territories

We have a regional master license agreement for the Expansion Territories with Dr Pepper Snapple Group, Inc. for Dr Pepper brands. This agreement is generally similar to our beverage agreements with Dr Pepper Snapple Group, Inc. for the Legacy Territories, but has a term of ten years, renewable at our option for an additional ten-year term. In addition, we also have the right under our new distribution agreement with Monster Energy Company to distribute energy drink products offered, packaged and/or marketed by Monster Energy Company under the primary brand name “Monster” within the Expansion Territories.

Product Supply Arrangements

We have historically had a production arrangement with CCR to buy and relatedsell finished products and expressly permitted existing cross-licensed brandsat cost. In the Distribution Territory Expansion Transactions, we have, with certain exceptions, agreed to continue purchasing finished beverage products from CCR’s manufacturing facilities that were then servicing customers in certain of the Expansion Territories at a cost-based price, subject to adjustment in accordance with theour current incidence-based pricing agreement that the Company entered into with The Coca-Cola Company described above, as applicable to the Expansion Territory. Under certain exceptions, the Companywe may produce finished goods itself for our own distribution in an Expansion Territory.

TerritoryThe Ancillary Business Letter.

The Company and

Regional Manufacturing Agreements with The Coca-Cola Company entered intofor the Ancillary Business Letter in May 2014 grantingExpansion Territories

In fiscal 2016, the Company certain advance waiversacquired an Expansion Manufacturing Facility in Sandston, Virginia pursuant to acquire or develop certain linesthe October 2015 APA. We are now authorized to manufacture beverages bearing trademarks of businessThe Coca-Cola Company using cold-fill technology at the Sandston, Virginia facility pursuant to an Initial Regional Manufacturing Agreement (“Initial RMA”). The Initial RMA refers to those beverages as “Authorized Covered Beverages.”  We anticipate entering into a similar Initial RMA at each subsequent closing under the October 2015 APA.  Subject to the right of The Coca-Cola Company to terminate the Initial RMA in the event of an uncured default by the Company, the Initial RMA has a term that continues for the duration of the term of our CBAs with The Coca-Cola Company and CCR. Other than Authorized Covered Beverages, certain cross-licensed brands that we are permitted to distribute under our CBAs, and certain other expressly permitted existing cross-licensed brands, the Initial RMA provides that we will not manufacture at the Expansion Territories involvingManufacturing Facilities any Beverages, Beverage Components (as such terms are defined in the preparation, distribution, sale, dealing in or otherwise using or handlingform of beverages, beverage componentsthe Initial RMA) or other beverage products that wouldunless otherwise consented to by The Coca-Cola Company.

Pursuant to its terms, each Initial RMA will be prohibitedamended, restated and converted into a final form of regional manufacturing agreement (“Final RMA”) concurrent with the conversion of our bottling agreements to the Final CBA under the CBAs. In connection with receiving such waiversTerritory Conversion Agreement.  Under the Final RMA, our aggregate business directly and in recognitionprimarily related to the manufacture of the substantial management timeAuthorized Covered Beverages, permitted third party beverage products and resources of the Company needed to complete the acquisitionother beverages and integration of the Expansion Territories, the Company has agreed that during the period beginning on May 23, 2014 and continuing until January 1, 2017 (the “Focus Period”) it will not acquire or develop any line of business inside or outside of the Expansion Territories without the consentbeverage products of The Coca-Cola Company (which consent cannotwill be unreasonably withheld). This restriction is subject to certain limited exceptions describedthe same agreed upon sale process provisions included in the Ancillary Business Letter. This restriction also may terminate sooner if either party provides noticeFinal CBA, including the need to the other (i) that it is terminating discussions regarding the Company receiving rights to any Expansion Territory contemplated by the April 13, 2013 letterobtain The Coca-Cola Company’s prior approval of intent or, (ii) if transactions for alla potential purchaser of the Expansion Territory transactions contemplated by such letter of intent have been consummated, that it does not intend to pursue any other transactions that would result in additional territory expansion by the Company. In exchange,manufacturing business. The Coca-Cola Company has agreedwill have the right to terminate the Final RMA in the Ancillary Business Letter that, following the Focus Period, certain typesevent of activities relating to the preparation, distribution, sale, dealing in or otherwise using or handling beverages, beverage components and other beverage products that would otherwise be prohibitedan uncured default by the CBAs for the Expansion Territoriesus. The Final RMA also will be permitted without its consent. As a result, following the Focus Period,subject to termination by The Coca-Cola Company’s consent (which cannot be unreasonably withheld) will only be required under the CBAs for the acquisition or development by the Company in the Expansion Territoriesevent of (i) any grocery, quick service restaurant,an uncured default by us under the Final CBA or convenienceunder the NPSG Governance Agreement (described below).

National Product Supply Governance Agreement

In connection with our expanded manufacturing operations and petroleum store business engagedrole in the salenational Coca-Cola product supply system, we entered into an agreement with The Coca-Cola Company and three other regional producing bottlers in October 2015 to form a national product supply group (the “NPSG Governance Agreement”).  The NPSG Governance Agreement establishes the framework for Coca-Cola system strategic infrastructure investment and divestment planning, network optimization of beverages, beverage componentsall plant to distribution center sourcing and new product/packaging infrastructure planning. Under the NPSG Governance Agreement, each of the other beverage products not permittedregional producing bottlers and the Company have agreed to make investments in our respective manufacturing assets and implement Coca-Cola system strategic investment opportunities that are approved by the CBAs (“Prohibited Beverages”), or (ii) any other line of business engaged in the preparation, distribution, sale, dealing in, using or handling of Prohibited Beverages in which all beverage activities in the aggregate constitute more than ten percent (10%)governing board of the net salesnational product supply group and consistent with the terms of such business.the NPSG Governance Agreement.

Markets Served and Production and Distribution Facilities

The CompanyWe currently holdshold bottling rights in itsthe Legacy Territories and Expansion Territories from The Coca-Cola Company covering the majority of North Carolina, South Carolina and West Virginia, and portions of Alabama, Mississippi, Tennessee, Kentucky, Illinois,

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Indiana, Virginia, Pennsylvania, Maryland, Georgia and Florida. The total population within the Company’sCompany's Legacy Territories and Expansion Territories completed as of December 28, 2014January 3, 2016 is 22.4approximately 32.8 million.

As of December 28, 2014, the CompanyJanuary 3, 2016, we currently operatesoperate in sevennine principal geographic markets. Certain information regarding each of these markets follows:

1. 1.North Carolina.Carolina. This region includes the majority of North Carolina, including Charlotte, Raleigh, Greensboro, Winston-Salem, High Point, Hickory, Asheville, Fayetteville, Wilmington, Elizabeth City and the surrounding areas. The region has a population of 9.4approximately 9.7 million. The Company hasWe have a production/distribution facility in Charlotte and 12 sales distribution facilities located throughout the region.

2. 2.South Carolina. This region includes the majority of South Carolina, including Charleston, Columbia, Greenville, Myrtle Beach and the surrounding areas. The region has a population of 3.8approximately 4.0 million. There are six6 sales distribution facilities located throughout the region.

3. 3.South AlabamaSouthern Alabama/Mississippi. This region includes a portion of southwestern Alabama, including Mobile and surrounding areas, and a portion of southeastern Mississippi. The region has a population of approximately 1.0 million. The Company hasWe have a production/distribution facility in Mobile and four4 sales distribution facilities are located throughout the region.

4. 4.South GeorgiaSouthern Georgia/ Florida. This region includes a small portion of eastern Alabama, a portion of southwestern Georgia, including Columbus and surrounding areas, and a portion of the Florida Panhandle. This region has a population of approximately 1.1 million. The Company has fourWe have 4 sales distribution facilities located throughout the region.

5. 5.Tennessee. This region includes a significant portion of central and eastern Tennessee, including Nashville, Johnson City, Morristown, and Knoxville, Cleveland, Cookeville and surrounding areas, a small portion of southern Kentucky and a small portion of northwest Alabama. The region has a population of 4.1approximately 4.4 million. The Company hasWe have a production/distribution facility in Nashville and six7 sales distribution facilities are located throughout the region. The region includes portions of the Company’s Legacy Territories and several Expansion Territories, including Johnson City, Morristown and Knoxville.Territories.

6. 6.Western Virginia. This region includes most of southwestern Virginia, including Roanoke and surrounding areas, a portion of the southern piedmont of Virginia, a portion of northeastern Tennessee and a portion of southeastern West Virginia. The region has a population of approximately 1.6 million. The Company hasWe have a production/distribution facility in Roanoke and four4 sales distribution facilities are located throughout the region.

7. 7.West Virginia. This region includes most of the state of West Virginia and a portion of southwestern Pennsylvania. The region has a population of approximately 1.4 million. The Company has eightWe have 8 sales distribution facilities located throughout the region.

Subsequent to December 28, 2014, the Company acquired additional distribution territories in Cookeville, and Cleveland, Tennessee,8. Kentucky. This region includes a significant portion of Kentucky, including Lexington, Louisville, Paducah, Pikeville, Kentucky and surrounding areas, a portion of southern Indiana, including Evansville, Indiana. These Expansion Territories serveand a portion of southeastern Illinois.  The region has a population of 3.1 million andapproximately 4.8 million.  We have a total of four5 sales distribution facilities.facilities located throughout the region, all which have been acquired in 2015.

9. Eastern Virginia. This region includes a significant portion of eastern and northern Virginia, including Norfolk, Staunton and Fredericksburg, Virginia and surrounding areas.  The region has a population of approximately 4.8 million.  We have 3 sales distribution facilities located throughout the regions, all which have been acquired in 2015.

In fiscal 2016, we acquired additional Expansion Territories in Easton and Salisbury, Maryland and Richmond and Yorktown, Virginia, as well as the Expansion Manufacturing Facility in Sandston, Virginia. We also entered into a non-binding letter of intent with The Coca-Cola Company isin February 2016 which contemplates our acquisition of additional CBA Rights and Transferred Assets relating to distribution territories currently served by CCR in northern Ohio and northern West Virginia and an additional Expansion Manufacturing Facility located in Twinsburg, Ohio.

We are a member of South Atlantic Canners, Inc. (“SAC”), a manufacturing cooperative located in Bishopville, South Carolina. All eight members of SAC are Coca-Cola bottlers and each member has equal voting rights. The Company receivesWe receive a fee for managing the day-to-day operations of SAC pursuant to a management agreement. Management fees earned from SAC were $1.9 million, $1.8 million and $1.6 million in 2015, 2014 and $1.5 million in 2014, 2013, and 2012, respectively. SAC’s bottling lines supply a portion of the Company’sour volume requirements for beverage products. The Company hasWe have a commitment with SAC that requires minimum annual purchases of 17.5 million cases of beverage products through June 2024. Purchases from SAC by the Company for finished products were $145 million, $132 million and $137 million in 2015, 2014 and $141 million in 2014, 2013, and 2012, respectively, or 28.3 million cases, 25.9 million cases 26.2 million cases and 27.526.2 million cases of finished product, respectively.

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Raw Materials

In addition to concentrates obtainedpurchased from The Coca-Cola Company and other beverage companies for use in itsour beverage manufacturing, the Companywe also purchasespurchase sweetener, carbon dioxide, plastic bottles, cans, closures and other packaging materials, as well as equipment for the production, distribution and marketing of nonalcoholic beverages.

The Company purchasesWe purchase substantially all of itsour plastic bottles (12-ounce, 16-ounce, 20-ounce, 24-ounce, half-liter, 1-liter, 1.25-liter, 2-liter, 253 ml and 300 ml sizes) from manufacturing plants owned and operated by Southeastern Container and Western Container, two entities owned by various Coca-Cola bottlers, including the Company. The CompanyWe currently obtainsobtain all of itsour aluminum cans (7.5-ounce, 12-ounce and 16-ounce sizes) from two domestic suppliers. None of the materials or supplies used by the Companywe use are currently in short supply.

Along with all the other Coca-Cola bottlers in the United States, the Company iswe are a member in Coca-Cola Bottlers’ Sales and Services Company, LLC (“CCBSS”), which was formed in 2003 for the purposes of facilitatingto facilitate various procurement functions and distributing certain specifiedthe distribution of beverage products of The Coca-Cola Company with the intention of enhancing the efficiency and competitiveness of the Coca-Cola bottling system in the United States. CCBSS negotiates the procurement for the majority of the Company’sour raw materials (excluding concentrate).

The Company is

We are exposed to price risk on commodities such as aluminum, corn, PET resin (a petroleum-based product), and fuel which affects the cost of raw materials used in the production of finished products. The CompanyWe both producesproduce and procuresprocure these finished products. Examples of the raw materials affected are aluminum cans and plastic bottles used for packaging and high fructose corn syrup used as a product ingredient. Further, the Company iswe are exposed to commodity price risk on oil, which impacts the Company’sour cost of fuel used in the movement and delivery of the Company’sour products. The Company participatesWe participate in commodity hedging and risk mitigation programs administered both by CCBSS and by the Company itself.Company. In addition, no limit is placed on the price The Coca-Cola Company and other beverage companies can charge for concentrate. However, under the Incidence Pricing Agreement, The Coca-Cola Company must give the Company at least 90 days written notice of a pricing change.

Customers and Marketing

The Company’sOur products are sold and distributed directly to retail stores and other outlets, including food markets, institutional accounts and vending machine outlets. During 2014,2015, approximately 68% of the Company’sour bottle/can volume to retail customers was sold for future consumption. The remaining bottle/can volume to retail customers of approximately 32% was sold for immediate consumption, primarily through dispensing machines owned either by the Company, retail outlets or third party vending companies. The Company’sIn 2015, our largest customer, Wal-Mart Stores, Inc., accounted for approximately 22% of the Company’sour total bottle/can volume to retail customers and theour second largest customer, Food Lion, LLC, accounted for approximately 9%7% of the Company’sour total bottle/can volume to retail customers. Wal-Mart Stores, Inc. and Food Lion, LLC accounted for approximately 15% and 6%5% of the Company’s total net sales, respectively. The loss of either Wal-Mart Stores, Inc. or Food Lion, LLC as customers could have a material adverse effect on the operating and financial results of the Company. All of the Company’sour beverage sales are to customers in the United States.

New product introductions, packaging changes and sales promotions have been the primary sales and marketing practices in the nonalcoholic beverage industry in recent years and have required and are expected to continue to require substantial expenditures. Brand introductions from the Company and The Coca-Cola Company in recent years include Tum-E Yummies, Fuel in a Bottle Energy Shot, Fuel in a Bottle Protein Shot, Coca-Cola Zero, Dasani flavors, Coca-Cola Life, Full Throttle and Gold Peak tea products. New packaging introductions include the 253 ml bottle, the 1.25-liter bottle, the 7.5-ounce sleek can, the 2-liter contour bottle for Coca-Cola products, and the 16-ounce bottle/24-ounce bottle package.

The Company sells itsWe sell our products primarily in nonrefillable bottles and cans, in varying proportions from market to market. For example, there may be as many as 23 different packages for Diet Coke within a single geographic area. Bottle/can volume to retail customers during 20142015 was approximately 44%54% bottles, 45% cans 55% bottles and 1% other containers.

Advertising in various media, primarily television and radio, is relied upon extensively in the marketing of the Company’sour products.  The Coca-Cola Company, Monster Energy Company and Dr Pepper Snapple Group, Inc. (collectively, the “Beverage Companies”) make substantial expenditures on advertising in the Company’s Legacy Territories and Expansion

Territories. The Company hasWe have also benefited from national advertising programs conducted by the Beverage Companies. In addition, the Company expendswe expend substantial funds on itsour own behalf for extensive local sales promotions of the Company’sour products. Historically, these expenses have been partially offset by marketing funding support the Beverage Companies provide to the Companyus in support of a variety of marketing programs, such as point-of-sale displays and merchandising programs. However,While the Beverage Companies are under no obligation to provide the Companyhave provided us with marketing funding support in the future.past, our bottling agreements generally do not obligate the Beverages Companies to do so.

The substantial outlays the Company makeswe make for marketing and merchandising programs are generally regarded as necessary to maintain or increase revenue, and any significant curtailment of marketing funding support provided by the Beverage Companies for marketing programs which benefit the Companyus could have a material adverse effect on theour operating and financial resultsresults.

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In addition to our marketing and merchandising programs, we believe a sustained and planned charitable giving program is an essential component of our success by supporting our brand through supporting the communities we serve.  Since 2009, we have given approximately $9.0 million to various donor advised charitable funds.   In March 2016, the Board approved a one-time special contribution of $4 million and an annual contribution of $2 million for 2016 in light of the Company.Company’s financial performance, expanded distribution territory footprint and future business prospects. The Company intends to continue its charitable contributions in future years subject to the Company’s financial performance and other business factors.

Seasonality

Sales of the Company’sour products are seasonal with the highest sales volume occurring in the second and third quarters. The Company has,We have, and believesbelieve CCR has, adequate production capacity to meet sales demand for sparkling and still beverages during these peak periods. See “Item 2. Properties” for information relating to utilization of the Company’sour production facilities. Sales volume can also be impacted by weather conditions.

Competition

The nonalcoholic beverage market is highly competitive. The Company’sOur competitors include bottlers and distributors of nationally advertised and marketed products and regionally advertised and marketed products, as well as bottlers and distributors of private label beverages in supermarket stores. The sparkling beverage market (including energy products) comprised 80%79% of the Company’sour bottle/can volume to retail customers in 2014.2015. In each region in which the Company operates,we operate, between 85%90% and 95% of sparkling beverage sales in bottles, cans and other containers are accounted for by the Company and its principal competitors, which in each region includes the local bottler of Pepsi-Cola and, in some regions, the local bottler of Dr Pepper, Royal Crown and/or 7-Up products.

The principal methods of competition in the nonalcoholic beverage industry are point-of-sale merchandising, new product introductions, new vending and dispensing equipment, packaging changes, pricing, price promotions, product quality, retail space management, customer service, frequency of distribution and advertising. The Company believes it isWe believe we are competitive in itsour territories with respect to these methods of competition.

Government Regulation

The production and marketing of beverages are subject to the rules and regulations of the United States Food and Drug Administration (“FDA”) and other federal, state and local health agencies. The FDA also regulates the labeling of containers under The Nutrition Labeling and Education Act of 1990. The Nutrition Facts label has not changed significantly since it was first introduced in 1994. In 2014, the FDA proposed two new rules that would result in major changes to nutrition labels on all food packages, including the packaging for the Company’sour products, that would, among other things, require those labels to display caloric counts in large type, reflect larger portion sizes and display on a separate line on the label the amount of sugars that are added to the product. The comment period on the two original proposed rules closed in August 2014. In 2015, the FDA issued a supplemental proposed rule that would, among other things, require declaration of the percent daily value for added sugars and change the current footnote on the Nutrition Facts label. The comment period on the supplemental proposed rule closed in October 2015. If these proposed rules are adopted by the FDA, the Company expectswe expect to have up to two years to put the required labeling changes into effect on the packaging for the products it manufactureswe manufacture and distributes.distribute.

As a manufacturer, distributor and seller of beverage products of The Coca-Cola Company and other soft drink manufacturers in exclusive territories, the Company iswe are subject to antitrust laws of general applicability. However, pursuant to the United States Soft Drink Interbrand Competition Act, soft drink bottlers such as the Company may have an exclusive right to manufacture, distribute and sell a soft drink product in a defined geographic territory if that soft drink product is in substantial and effective competition with other products of the same general class in the market. The Company believesWe believe such competition exists in each of the exclusive geographic territories in the United States in which the Company operates.

From time to time, legislation has been proposed in Congress and by certain state and local governments which would prohibit the sale of soft drink products in nonrefillable bottles and cans or require a mandatory deposit as a means of encouraging the return of such containers in an attempt to reduce solid waste and litter. The Company isWe are currently not impacted by this type of proposed legislation.

Soft drink and similar-type taxes have been in place in West Virginia and Tennessee for several years. Proposals have been introduced by members of Congress and certain state governments that would impose excise and other special taxes on certain beverages that the Company sells. The Companywe sell.  We cannot predict whether any such legislation will be enacted.

Most of the beverage products sold by the Company are classified as food or food products and are therefore eligible for purchase using supplemental nutrition assistance (“SNAP”) benefits by consumers purchasing them for home consumption. Some states and

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localities have proposed barring the use of SNAP benefits by recipients in their jurisdictions to purchase some of the products the Company manufactures.we manufacture. The United States Department of Agriculture rejected such a proposal by a major American city as recently as 2011. Energy drinks that have a nutrition factsNutrition Facts label are classified as food and are eligible for purchase for home consumption using SNAP benefits while energy drinks that are classified as a supplement by the FDA are not.

The Company has

We have experienced public policy challenges regarding the sale of soft drinks in schools, particularly elementary, middle and high schools. A number of states have regulations restricting the sale of soft drinks and other foods in schools. Many of these restrictions have existed for several years in connection with subsidized meal programs in schools. The focus has more recently turned to the growing health, nutrition and obesity concerns of today’s youth. Restrictive legislation, if widely enacted, could have an adverse impact on the Company’sour products, image and reputation.

Environmental Remediation

The Company doesWe do not currently have any material capital expenditure commitments for environmental compliance or environmental remediation for any of itsour properties. The Company doesWe do not believe compliance with federal, state and local provisions that have been enacted or adopted regarding the discharge of materials into the environment, or otherwise relating to the protection of the environment, will have a material effect on itsour capital expenditures, earnings or competitive position.

Employees

As of February 1, 2015, the CompanyJanuary 3, 2016, we had approximately 5,6007,600 full-time employees, of whom approximately 420500 were union members. The total number of employees, including part-time employees, was approximately 7,300.9,500. Approximately 6%5% of the Company’sour labor force is covered by collective bargaining agreements. Two collective bargaining agreements covering approximately 5% of the Company’s employees expired during 2014 and the Company entered into new agreements in 2014. One collective bargaining agreement covering approximately .3%25 of the Company’sour employees expired during 2015 and we entered into a new agreement in 2015. Three collective bargaining agreements covering approximately 65 of our employees will expire in 2015.fiscal 2016.

Exchange Act Reports

The Company makes available free of charge through the Company’s Internetour website,www.cokeconsolidated.com, the Company’s annual reportour Annual Report on Form 10-K, quarterly reportsQuarterly Reports on Form 10-Q, current reportsCurrent Reports on Form 8-K, proxy statement and all amendments to thosethese reports. These reports are available on our website as soon as reasonably practicable after such materials are electronically filed with, or furnished to, the SecuritiesSEC. The information provided on our website is not part of this report and Exchange Commission (SEC). is not incorporated herein by reference.

The SEC also maintains an Interneta website,www.sec.gov, which contains reports, proxy and information statements and other information filed electronically with the SEC. Any materials that the Company fileswe file with the SEC may also be read and copied at the SEC’s Public Reference Room, 100 F Street, N.E., Room 1580, Washington, D. C.DC 20549.

Information on the operations of the Public Reference Room is available by calling the SEC at 1-800-SEC-0330. The information provided on the Company’s website is not part of this report and is not incorporated herein by reference.

In addition to other information in this Form 10-K, the following risk factors should be considered carefully in evaluating the Company’s business. The Company’s business, financial condition or results of operations could be materially and adversely affected by any of these risks.

The Company may not be able to respond successfully to changes in the marketplace.

The Company operates in the highly competitive nonalcoholic beverage industry and faces strong competition from other general and specialty beverage companies. The Company’s response to continued and increased customer and competitor consolidations and marketplace competition may result in lower than expected net pricing of the Company’s products. The Company’s ability to gain or maintain the Company’s share of sales or gross margins may be limited by the actions of the Company’s competitors, which may have advantages in setting their prices due to lower raw material costs. Competitive pressures in the markets in which the Company operates may cause channel and product mix to shift away from more profitable channels and packages. If the Company is unable to maintain or increase volume in higher-margin products and in packages sold through higher-margin channels (e.g., immediate consumption), pricing and gross margins could be adversely affected. The Company’s efforts to improve pricing may result in lower than expected sales volume.

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Changes in how significant customers market or promote the Company’s products could reduce revenue.

The Company’s revenue is affected by how significant customers market or promote the Company’s products. Revenue has been negatively impacted by less aggressive price promotion by some retailers in the future consumption channels over the past several years. If the Company’s significant customers change the manner in which they market or promote the Company’s products, the Company’s revenue and profitability could be adversely impacted.

Changes in the Company’s top customer relationships could impact revenues and profitability.

The Company is exposed to risks resulting from several large customers that account for a significant portion of its bottle/can volume and revenue. The Company’s two largest customers accounted for approximately 31%29% of the Company’s 20142015 bottle/can volume to retail customers and approximately 21%20% of the Company’s total net sales. The loss of one or both of these customers could adversely affect the Company’s results of operations. These customers typically make purchase decisions based on a combination of price, product quality, consumer demand and customer service performance and generally do not enter into long-term contracts. In addition, these significant customers may re-evaluate or refine their business practices related to inventories, product displays, logistics or other aspects of the customer-supplier relationship. The Company’s results of operations could be adversely affected if revenue from one or more of these customers is significantly reduced or if the cost of complying with these customers’ demands is significant. If receivables from one or more of these customers become uncollectible, the Company’s results of operations may be adversely impacted.

Changes in public and consumer preferences related to nonalcoholic beverages could reduce demand for the Company’s products and reduce profitability.profitability.

The Company’s business depends substantially on consumer tastes and preferences that change in often unpredictable ways. The success of the Company’s business depends in large measure on working with the Beverage Companies to meet the changing preferences of the broad consumer market. Health and wellness trends throughout the marketplace have resulted in a shift from sugar sparkling beverages to diet sparkling beverages, tea, sports drinks, enhanced water and bottled water over the past several years. Failure to satisfy changing consumer preferences, particularly those of young people, could adversely affect the profitability of the Company’s business.

The Company’s sales can be impacted by the health and stability of the general economy.

Unfavorable changes in general economic conditions, such as a recession or economic slowdown in the geographic markets in which the Company does business, may have the temporary effect of reducing the demand

for certain of the Company’s products. For example, economic forces may cause consumers to shift away from purchasing higher-margin products and packages sold through immediate consumption and other highly profitable channels. Adverse economic conditions could also increase the likelihood of customer delinquencies and bankruptcies, which would increase the risk of uncollectibility of certain accounts. Each of these factors could adversely affect the Company’s revenue, price realization, gross margins and overall financial condition and operating results.

The inability of the Company to successfully integrate the operations ofacquired in the Expansion TerritoriesTransactions and in any future expansion territoriesExpansion Transactions into the Company’s existing operations and implement the new contractual arrangements for the Expansion TerritoriesTransactions could adversely affect the Company’s business, financial condition or results of operations.

The following poseCompany faces several potential risks relative to the Expansion Territories:Transactions including, without limitation, the Company’s ability to successfully combine the Company’s existing business with the distribution territories and manufacturing facilities acquired in the Expansion Territories,Transactions, including integrating production, distribution, sales and administrative support activities and information technology systems between the Company’s Legacy TerritoriesTerritory operations and the operations acquired in the Expansion Territories;Transactions; and the Company’s ability to successfully operate in the Expansion Territories:Territories and to operate the Expansion Manufacturing Facilities.  Other risks involve motivating, recruiting and retaining key employees; conforming standards, controls (including internal control over financial reporting, environmental compliance and health and safety compliance), procedures and policies and business cultures between the Company and the operations acquired in the Expansion Territories;Transactions; growing business with existing customers and attracting new customers; and other unanticipated problems and liabilities. The territory expansion transactions the Company has recently completed Expansion Transactions and any future expansion transactions also involve certain other financial and business risks, including that the Company might not realize a satisfactory return on the Company’s investment, that the Company’s assumptions regarding potential growth, synergies or cost savings could turn out to have been incorrect, or that the territory expansionstransactions divert key members of the Company’s management’s attention and the Company’s other available resources from ourits existing business in the Legacy Territories.

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Miscalculation of the Company’s need for infrastructure investment could impact the Company’s financial results in both the Company’s Legacy and Expansion Territories and any future expansion territories.

Projected requirements of the Company’s infrastructure investments in both the Company’s Legacy and Expansion Territories and any future expansion territories may differ from actual levels if the Company’s volume growth is not as the Company anticipates. The Company’s infrastructure investments are generally long-term in nature; therefore, it is possible that investments made today may not generate the returns expected by the Company due to future changes in the marketplace. Significant changes from the Company’s expected returns on cold drink equipment, fleet, technology and supply chain infrastructure investments could adversely affect the Company’s consolidated financial results.

The Company’s inability to meet requirements under its beverage agreements could result in the loss of distribution rights.

Approximately 88%87% of the Company’s bottle/can volume to retail customers in 20142015 consisted of products of The Coca-Cola Company, which is the sole supplier of these products or of the concentrates or syrups required to manufacture these products. The remaining 12%13% of the Company’s bottle/can volume to retail customers in 20142015 consisted of products of other beverage companies and the Company’s own products.companies. The Company must satisfy various requirements under its beverage agreements, including the new CBAs for the Expansion Territories, which include additional obligations the Company must perform. Failure to satisfy these requirements could result in the loss of distribution rights for the respective products under one or more of these beverage agreements. The occurrence of other events defined in these agreements could also result in the termination of one or more beverage agreements.

Material changesChanges in orthe inputs used to calculate the Company’s inabilityacquisition related contingent consideration liability could have a material adverse impact on the Company’s financial results.

The acquisition related contingent consideration liability consists of the estimated amounts due to satisfy,The Coca-Cola Company under the performance requirements for marketing funding support,Comprehensive Beverage Agreements over the remaining useful life of the related distribution rights intangible assets.  Changes in business conditions or decreasesother events could materially change both the projections of future cash flows and the discount rate used in the calculation of the fair value of contingent consideration under the Comprehensive Beverage Agreements.  These changes could materially impact the fair value of the related contingent consideration and could materially impact the amount of noncash expense (or income) recorded each reporting period.

Decreases from historic levels of marketing funding support could reduce the Company’s profitability.

Material changes in the performance requirements, or decreases in the levels of marketing funding support historically provided, under marketing programs with The Coca-Cola Company and other beverage companies, or the Company’s inability to meet the performance requirements for the anticipated levels of such marketing funding support payments, could adversely affect the Company’s profitability. The Coca-ColaWhile the Company and other beverage companies are under no obligation to continuedoes not believe there will be significant changes in the levels of marketing funding support atby the Beverage Companies, there can be no assurance that historic levels.levels will continue.

Changes in The Coca-Cola Company’s and other beverage companies’ levels of advertising, marketing spending and product innovation could reduce the Company’s sales volume.

The Coca-Cola Company’s and other beverage companies’ levels of advertising, marketing spending and product innovation directly impact the Company’s operations. While the Company does not believe there will be significant changes in the levels of marketing and advertising by the Beverage Companies, there can be no assurance that historic levels will continue. The Company’s volume growth will also continue to be dependent on product innovation by the Beverage Companies, especially The Coca-Cola Company. Decreases in marketing, advertising and product innovation by the Beverage Companies could adversely impact the profitability of the Company.

The inability of the Company’s aluminum can or plastic bottle suppliers to meet the Company’s purchase requirements could reduce the Company’s profitability.

The Company currently obtains all of its aluminum cans from two domestic suppliers and all of its plastic bottles from two domestic cooperatives. The inability of these aluminum can or plastic bottle suppliers to meet the Company’s requirements for containers could result in short-term shortages until alternative sources of supply can be located. The Company attempts to mitigate these risks by working closely with key suppliers and by purchasing business interruption insurance where appropriate. Failure of the aluminum can or plastic bottle suppliers to meet the Company’s purchase requirements could reduce the Company’s profitability.

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The inability of the Company to offset higher raw material costs with higher selling prices, increased bottle/can volume or reduced expenses could have an adverse impact on the Company’s profitability.

Raw material costs, including the costs for plastic bottles, aluminum cans and high fructose corn syrup, have been subject to significant price volatility in the past and may continue to be in the future. In addition, there are no limits on the prices The Coca-Cola Company and other beverage companies can charge for concentrate. If the Company cannot offset higher raw material costs with higher selling prices, increased sales volume or reductions in other costs, the Company’s profitability could be adversely affected.

The consolidation among suppliers of certain of the Company’s raw materials could have an adverse impact on the Company’s profitability.

In recent years, there has been consolidation among suppliers of certain of the Company’s raw materials. The reduction in the number of competitive sources of supply could have an adverse effect upon the Company’s ability to negotiate the lowest costs and, in light of the Company’s relatively small in-plant raw material inventory levels, has the potential for causing interruptions in the Company’s supply of raw materials.

The increasing reliance on purchased finished goods from external sources makes the Company subject to incremental risks that could have an adverse impact on the Company’s profitability.

TheAlthough the Company has become increasinglypurchased manufacturing assets and plans to continue to purchase additional manufacturing assets in the future, the Company remains reliant on purchased finished goods from external sources versus the Company’s internal production. As a result, the Company is subject to incremental risk including, but not limited to, product availability, price variability, and product quality and production capacity shortfalls for externally purchased finished goods. The Company’s operations in the Expansion Territories are more exposed to this risk

than the Company’s operations in the Legacy Territories because, with exceptions under which the Company may produce finished goods itself and for exceptions relating to Expansion Manufacturing Facilities acquired by the Company that have served the Expansion Territories, the Company is required under the CBAs for the Expansion Territories to purchase finished goods from CCR and other authorized external sources in accordance with the terms and conditions of the Finished Goods Supply Agreement entered into by the Company at the closing of each Expansion Territory transaction in quantities required to satisfy fully the demand for beverages and related products the Company is authorized under the CBAs to distribute in the Expansion Territory.

The Company’s participation in the National Product Supply Group (the “NPSG”) may create additional risk because we will not exercise sole decision making authority over national product supply system issues that affect the Company and other members of the NPSG Board may have different interests than we doSustained increases.                                                                                                                                                                          

Pursuant to the NPSG Governance Agreement, the Company has agreed to abide by decisions made by the NPSG governing board (the “NPSG Board”) that are made in accordance with the governance processes and principles outlined in the NPSG Governance Charter that is part of the NPSG Agreement.   Even though the Company will be a member of the NPSG Board, the Company will not exercise sole decision-making authority relating to the decisions of the NPSG Board, and the interests of other members of the NPSG Board may diverge from those of the Company.  These may include decisions made to benefit the Coca-Cola system as a whole but have a negative impact on the Company’s profitability, including decisions regarding strategic investment and divestment, optimal national product supply sourcing and new product or packaging infrastructure planning.

Increases in fuel prices or the inability of the Company to secure adequate supplies of fuel could have an adverse impact on the Company’s profitability.

The Company uses significant amounts of fuel in the distribution of its products. International or domestic geopolitical or other events could impact the supply and cost of fuel and could impact the timely delivery of the Company’s products to its customers. While the Company is working to reduce fuel consumption and manage the Company’s fuel costs, there can be no assurance that the Company will succeed in limiting the impact on the Company’s business or future cost increases. The Company may use derivative instruments to hedge some or all of the Company’s projected diesel fuel and gasoline purchases. These derivative instruments relate to fuel used in the Company’s delivery fleet and other vehicles. Sustained upward pressure in these costs could reduce the profitability of the Company’s operations.

Sustained increases in workers’ compensation, employment practices and vehicle accident claims costs could reduce the Company’s profitability.

The Company uses various insurance structures to manage its workers’ compensation, auto liability, medical and other insurable risks. These structures consist of retentions, deductibles, limits and a diverse group of insurers that serve to strategically transfer and mitigate the financial impact of losses. The Company uses commercial insurance for claims as a risk reduction strategy to minimize

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catastrophic losses. Losses are accrued using assumptions and procedures followed in the insurance industry, adjusted for company-specific history and expectations. Although the Company has actively sought to control increases in these costs, there can be no assurance that the Company will succeed in limiting future cost increases. SustainedContinued upward pressure in these costs could reduce the profitability of the Company’s operations.

Sustained increases in the cost of employee benefits could reduce the Company’s profitability.

The Company’s profitability is substantially affected by the cost of pension retirement benefits, postretirement medical benefits and current employees’ medical benefits. In recent years, the Company has experienced significant increases in these costs as a result of macro-economic factors beyond the Company’s control, including increases in health care costs, declines in investment returns on pension assets and changes in discount rates used to calculate pension and related liabilities. Although the Company has actively sought to control increases in these costs, there can be no assurance the Company will succeed in limiting future cost increases, and continued upward pressure in these costs could reduce the profitability of the Company’s operations.

Product safety and quality concerns, including concerns related to perceived artificiality of ingredients, could negatively affect the Company’s business.

The Company’s success depends in large part on its ability to maintain consumer confidence in the safety and quality of all its products. The Company has rigorous product safety and quality standards. However, if beverage products taken to market are or become contaminated or adulterated, the Company may be required to conduct costly product recalls and may become subject to product liability claims and negative publicity, which would cause its business to suffer. In addition, regulatory actions, activities by nongovernmental organizations and public debate and concerns about perceived negative safety and quality consequences of certain ingredients in the Company’s products, such as non-nutritive sweeteners, may erode consumers’ confidence in the safety and quality issues, whether or not justified, and could result in additional governmental regulations concerning the marketing and labeling of the Company’s products, negative publicity, or actual or threatened legal actions, all of which could damage the reputation of the Company’s products and may reduce demand for the Company’s products.

Cybersecurity risks - technology failures or cyberattacks on the Company’s systems could disrupt the Company’s operations and negatively impact the Company’s business.

The Company increasingly relies on information technology systems to process, transmit and store electronic information. For example, the Company’s production and distribution facilities, inventory management and driver handheld devices all utilize information technology to maximize efficiencies and minimize costs. Furthermore, a significant portion of the communication between personnel, customers and suppliers depends on information technology. Like most companies, the Company’s information technology systems may be vulnerable to interruption due to a variety of events beyond the Company’s control, including, but not limited to, natural disasters, terrorist attacks, telecommunications failures, computer viruses, hackers and other security issues. The Company may also experience difficulties integrating systems from Expansion Territories with those in its Legacy Territories. The Company has technology security initiatives and disaster recovery plans in place to mitigate the Company’s risk to these vulnerabilities, but these measures may not be adequate or implemented properly to ensure that the Company’s operations are not disrupted.

Changes in interest rates could adversely affect the profitability of the Company.

As of February 28, 2015, $153.0 million of2016, only the Company’s debt and capital lease obligations of $584.8 million were subject to changes in short-term interest rates. The Company’s $350$450 million revolving credit facility iswas subject to changes in short-term interest rates. On February 28, 2015,2016, the Company had $153.0$75.0 million of outstanding borrowings on the $350$450 million revolving credit facility. If interest rates increase in the future, it could increase the Company’s borrowing cost and it could reduceincrease, which could result in a reduction of the Company’s overall profitability. The Company’s pension and postretirement medical benefits costs are also subject to changes in interest rates. A decline in interest rates used to discount the Company’s pension and postretirement medical liabilities could increase the cost of these benefits and increase the overall liability.

The level of the Company’s debt could restrict the Company’s operating flexibility and limit the Company’s ability to incur additional debt to fund future needs.

As of February 28, 2015,2016, the Company had $584.8$753.6 million of debt and capital lease obligations. The Company’s level of debt requires the Company to dedicate a substantial portion of the Company’s future cash flows from operations to the payment of principal and interest, thereby reducing the funds available to the Company for other purposes. The Company’s debt can negatively impact the Company’s operations by (1) limiting the Company’s ability and/or increasing the cost to obtain funding for working capital, capital expenditures and other general corporate purposes,purpose, including funding the cash purchase price of future territory expansions; (2) increasing the Company’s vulnerability to economic downturns and adverse industry conditions by limiting the Company’s ability to react to changing economic and business conditions; and (3) exposing the Company to a risk that a significant decrease in cash flows from operations could make it difficult for the Company to meet the Company’s debt service requirements.

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The Company’s credit ratings could be negatively impacted by changes to The Coca-Cola Company’s credit ratings.

The Company’s credit rating could be significantly impacted by capital management activities of The Coca-Cola Company and/or changes in the credit ratings of The Coca-Cola Company. A lower credit rating could significantly increase the Company’s interest costs or could have an adverse effect on the Company’s ability to obtain additional financing at acceptable interest rates or to refinance existing debt.

Changes in legal contingencies could adversely impact the Company’s future profitability.

Changes from expectations for the resolution of outstanding legal claims and assessments could have a material adverse impact on the Company’s profitability and financial condition. In addition, the Company’s failure to abide by laws, orders or other legal commitments could subject the Company to fines, penalties or other damages.

Legislative changes that affect the Company’s distribution, packaging and products could reduce demand for the Company’s products or increase the Company’s costs.

The Company’s business model is dependent on the availability of the Company’s various products and packages in multiple channels and locations to better satisfy the needs of the Company’s customers and consumers. Laws that restrict the Company’s ability to distribute products in schools and other venues, as well as laws that require deposits for certain types of packages or those that limit the Company’s ability to design new packages or market certain packages, could negatively impact the financial results of the Company.

In addition, excise or other taxes imposed on the sale of certain of the Company’s products by the federal government and certain state and local governments could cause consumers to shift away from purchasing products of the Company. If enacted, such taxes could materially affect the Company’s business and financial results, particularly if they were enacted in a form that incorporated them into the shelf prices for the Company’s products.

Significant additional labeling or warning requirements may inhibit sales of affected products.

In 2014 and again in 2015, the FDA proposed major changes to the nutrition labels required on all packaged foods and beverages, including those for most of the Company’s products. If the proposed changes are adopted, the Company and its competitors will be required to make nutrition label updates, which include updating serving sizes, including information about total calories in a beverage product container and providing information about any added sugars or nutrients. If the pending FDA nutrition label changes proposed become final, they will increase the Company’s costs and could inhibit sales of one or more of the Company’s major products. The timeline for implementation of any final regulations adopted by the FDA regarding changes to required nutrition labels is currently expected to be a period of up to two years.

Changes in income tax laws and increases in income tax rates could have a material adverse impact on the Company’s financial results.

The Company is subject to income taxes within the United States. The Company’s annual income tax rate is based upon the Company’s income and the federal tax laws and the various state tax laws within the jurisdictions in which the Company operates. Increases in federal or state income tax rates and changes in federal or state tax laws could have a material adverse impact on the Company’s financial results.

Additional taxes resulting from tax audits could adversely impact the Company’s future profitability.

An assessment of additional taxes resulting from audits of the Company’s tax filings could have an adverse impact on the Company’s profitability, cash flows and financial condition.

Natural disasters and unfavorable weather could negatively impact the Company’s future profitability.

Natural disasters or unfavorable weather conditions in the geographic regions in which the Company does business could have an adverse impact on the Company’s revenue and profitability. Unusually cold or rainy weather during the summer months may have a temporary effect on the demand for the Company’s products and contribute to lower sales, which could adversely affect the Company’s profitability for such periods. Prolonged drought conditions in the geographic regions in which the Company does business could lead to restrictions on the use of water, which could adversely affect the Company’s ability to manufacture and distribute products and the Company’s cost to do so.

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Global climate change or legal, regulatory, or market responses to such change could adversely impact the Company’s future profitability.profitability.

There is some scientific sentiment that increased concentrations of carbon dioxide, methane and other greenhouse gases (“GHGs”) in the atmosphere may have been the dominant cause of observed warming of the earth’s climate system since the mid-20thmid-20^th century, and that continued emission of GHGs could cause further warming and long-lasting changes in components of the global climate system, potentially increasing the

likelihood of severe, pervasive and irreversible impacts for people and ecosystems. Changing weather patterns, along with the increased frequency or duration of extreme weather and climate events, such as an increase in the number of heavy precipitation events, could impact some of the Company’s facilities and the availability or increase the cost of key raw materials that the Company uses to produce its products. In addition, the sale of the Company’s products can be impacted by weather conditions and climate events.

Growing concern over the effects of climate change, including warming of the global climate system, has led to legislative and regulatory initiatives directed at limiting GHG emissions. For example, the United States Environmental Protection Agency (USEPA) has proposed regulations under the Clean Air Act to reduce GHG emissions from existing coal-fired power plants which are expected to become final in 2015, that would require each state to submit a plan specifying how it would reduce GHG emissions from existing coal-fired power plants located within its bordersborders. It is anticipated that when the states implement their plans they could lead to the eventual closing of many of these plants. These USEPA proposed regulations or future laws enacted or regulations adopted to limit GHG emissions that directly or indirectly affect the Company’s production, distribution, packaging, cost of raw materials, fuel, ingredients and water could all impact the Company’s business and financial results.

Issues surrounding labor relations could adversely impact the Company’s future profitability and/or its operating efficiency.

Approximately 6%5% of the Company’s employees are covered by collective bargaining agreements. The inability to renegotiate subsequent agreements on satisfactory terms and conditions could result in work interruptions or stoppages, which could have a material impact on the profitability of the Company. Also, the terms and conditions of existing or renegotiated agreements could increase costs, or otherwise affect the Company’s ability to fully implement operational changes to improve overall efficiency. TwoOne collective bargaining agreements covering approximately 5%25 of the Company’s employees expired during 20142015 and the Company entered into new agreements in 2014. One2015. Three collective bargaining agreement covering approximately .3%65 of the Company’s employees will expire during 2015.2016.

The Company’s ability to change distribution methods and business practices could be negatively affected by United States Coca-Cola bottler system disputes.disputes within the United States.

Litigation filed by some United StatesU.S. bottlers of Coca-Cola products indicates that disagreements may exist within the Coca-Cola bottler system concerning distribution methods and business practices. Although the litigation has been resolved, disagreements among various Coca-Cola bottlers could adversely affect the Company’s ability to fully implement its business plans in the future.

Obesity and other health concerns may reduce demand for some of the Company’s products.

Consumers, public health officials, public health advocates and government officials are becoming increasingly concerned about the public health consequences associated with obesity, particularly among young people. In The production and marketing of beverages are subject to the rules and regulations of the FDA and other federal, state and local health agencies. The FDA also regulates the labeling of containers under The Nutrition Labeling and Education Act of 1990. The Nutrition Facts label has not changed significantly since it was first introduced in 1994. In March 2014 and again in July 2015, the FDA proposed new rules that would result in major changes to nutrition labels on all food packages, including the packaging for the Company’s products, that would, among other things, require those labels to display caloric counts in large type, reflect larger portion sizes and display on a separate line on the label the amount of sugars that are added to the product. If these proposed rules are adopted by the FDA, the Company expects to have up to two years to put the required labeling changes into effect on the packaging for the products it manufactures and distributes. In addition, some researchers, health advocates and dietary guidelines are encouraging consumers to reduce the consumption of sugar, including sugar sparkling beverages. Increasing public concern about these issues, possible new taxes and governmental regulations concerning the production, marketing, labeling or availability of the Company’s beverages, and negative

publicity resulting from actual or threatened legal actions against the Company or other companies in the same industry relating to the marketing, labeling or sale of sugar sparkling beverages may reduce demand for these beverages, which could adversely affect the Company’s profitability.

The Company has experienced public policy challenges regarding the sale of soft drinks in schools, particularly elementary, middle and high schools.

A number of states have regulations restricting the sale of soft drinks and other foods in schools. Many of these restrictions have existed for several years in connection with subsidized meal programs in schools. The focus has more recently turned to the growing

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health, nutrition and obesity concerns of today’s youth. The impact of restrictive legislation, if widely enacted, could have an adverse impact on the Company’s products, image and reputation.

If the financing of any future territory or other acquisitions involves issuing additional equity securities, their issuance would be dilutive and could affect the market price of the Company’s Common Stock.

Acquisitions of the distribution and manufacturing assets of CCR in the Expansion Territory transactionsTransactions completed to date have been financed with available cash, public debt issuance, or by draws on our revolving credit facility. The Company may fund any future territorydistribution, manufacturing or other acquisition transactions through the use of existing cash, cash equivalents or investments, debt financing, including draws on the Company’s revolving credit facility, the issuance of equity securities, or a combination of the foregoing. Any future acquisitions of additional distribution, manufacturing or other assets that are financed in whole or in part by issuing additional shares of the Company’s Common Stock would be dilutive, which could affect the market price of our Common Stock.

Provisions in the Final CBA and the Final RMA with The Coca-Cola Company could delay or prevent a change in control of the Company, which could adversely affect the price of our Common Stock.

Provisions in the Final CBA and the Final RMA require the Company to obtain The Coca-Cola Company’s prior approval of a potential buyer of the Company’s Coca-Cola distribution or manufacturing related businesses, which could delay or prevent a change in control of the Company or the ability of the Company to sell such businesses. The Company annually can obtain a list of approved third party buyers from The Coca-Cola Company or, upon receipt of a third party offer to purchase the Company or its Coca-Cola related business, may seek approval of such buyer by The Coca-Cola Company. In addition, the Final CBA and the Final RMA contain a sale process provision that would apply if the Company notifies The Coca-Cola Company that it wishes to sell the distribution or manufacturing business to The Coca-Cola Company, which process includes default terms and conditions of sale and a third party valuation should the Company and The Coca-Cola Company choose to use them. The Final CBA and the Final RMA also include terms that would apply in the event The Coca-Cola Company terminates the Final CBA or the Final RMA following the Company’s default thereunder.

The concentration of the Company’s capital stock ownership with the Harrison family limits other stockholders’ ability to influence corporate matters.

Members of the Harrison family, including the Company’s Chairman and Chief Executive Officer, J. Frank Harrison, III, beneficially own shares of Common Stock and Class B Common Stock representing approximately 86% of the total voting power of the Company’s outstanding capital stock. In addition, three members of the Harrison family, including Mr. Harrison, serve on the Board of Directors of the Company. As a result, members of the Harrison family have the ability to exert substantial influence or actual control over the Company’s management and affairs and over substantially all matters requiring action by the Company’s stockholders. Additionally, as a result of the Harrison family’s significant beneficial ownership of the Company’s outstanding voting stock, the Company has relied on the “controlled company” exemption from certain corporate governance requirements of The NASDAQ Stock Market LLC. This concentration of ownership may have the effect of delaying or preventing a change in control otherwise favored by the Company’s other stockholders and could depress the stock price. It also limits other stockholders’ ability to influence corporate matters and, as a result, the Company may take actions that the Company’s other stockholders may not view as beneficial.

None.

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As of February 28, 2015,2016, the principal properties of the Company include its corporate headquarters, 45 production/distribution facilities and 4856 sales distribution centers. The Company owns 23 production/distribution facilities and 3645 sales distribution centers, and leases its corporate headquarters, 2 production/distribution facilities, 811 sales distribution centers and 34 additional storage warehouses.

The approximate percentage utilization of the Company’sCompany's production facilities is indicated below:

The Company currently has sufficient production capacity to meet its operational requirements. In addition to the production facilities noted above, the Company utilizes a portion of the production capacity at SAC, a cooperative located in Bishopville, South Carolina, that owns a 261,000 square foot production facility.

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The Company’s products are generally transported to sales distribution facilities for storage pending sale. The number of sales distribution facilities by market area as of February 28, 20152016 was as follows:

(1) Includes two sales distribution facilities acquired in the Expansion Territories on January 30, 2015.

(2) Includes two sales distribution facilities acquired in the Expansion Territories on February 27, 2015.

The Company’sCompany's facilities are all in good condition and are adequate for the Company’sCompany's operations as presently conducted.

The Company also operates approximately 1,9302,900 vehicles in the sale and distribution of the Company’s beverage products, of which approximately 1,2302,050 are route delivery trucks. In addition, the Company owns approximately 218,500283,400 beverage dispensing and vending machines for the sale of the Company’s products in the Company’s bottling territories.

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The Company is involved in various claims and legal proceedings which have arisen in the ordinary course of its business. Although it is difficult to predict the ultimate outcome of these claims and legal proceedings, management believes that the ultimate disposition of these matters will not have a material adverse effect on the financial condition, cash flows or results of operations of the Company. No material amount of loss in excess of recorded amounts is believed to be reasonably possible as a result of these claims and legal proceedings.

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Not applicable.

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Executive OfficersOfficers of the Company

The following is a list of names and ages of all the executive officers of the Company indicating all positions and offices with the Company held by each such person. All officers have served in their present capacities for the past five years except as otherwise stated.

J. FRANK HARRISON, III, age 60,61, is Chairman of the Board of Directors and Chief Executive Officer. Mr. Harrison, III was appointed Chairman of the Board of Directors in December 1996. Mr. Harrison, III served as Vice Chairman from November 1987 through December 1996 and was appointed as the Company’sCompany's Chief Executive Officer in May 1994. He was first employed by the Company in 1977 and has served as a Division Sales Manager and as a Vice President.

HENRY W. FLINT, age 60,61, is President and Chief Operating Officer, a position he has held since August 2012. He has served as a Director of the Company since April 2007. Previously, he was Vice Chairman of the Board of Directors of the Company, a position he held since April 2007. Previously, he was Executive Vice President and Assistant to the Chairman of the Company, a position to which he was appointed in July 2004. Prior to that, he was a Managing Partner at the law firm of Kennedy Covington Lobdell & Hickman, L.L.P. with which he was associated from 1980 to 2004.

WILLIAM B. ELMORE, age 59, is Vice Chairman of the Board of Directors, a position he has held since August 2012. Previously, he was President and Chief Operating Officer and a Director of the Company, positions he held since January 2001. Prior to January 2001, he was Vice President, Value Chain from July 1999 and Vice President, Business Systems from August 1998 to June 1999. He was Vice President, Treasurer from June 1996 to July 1998. He was Vice President, Regional Manager for the Virginia Division, West Virginia Division and Tennessee Division from August 1991 to May 1996.

WILLIAM J. BILLIARD, age 48,49, is Vice President, Chief Accounting Officer. His previous position of Vice President, Operations Finance and Chief Accounting Officer began in November 2010. He was first employed by the Company onin February 20, 2006 with the title of Vice President, Controller and Chief Accounting Officer. Before joining the Company, he was Senior Vice President, Interim Chief Financial Officer and Corporate Controller of Portrait Corporation of America, Inc., a portrait photography studio company, from September 2005 to January 2006 and Senior Vice President, Corporate Controller from August 2001 to September 2005. Prior to that, he served as Vice President, Chief Financial Officer of Tailored Management, a long-term staffing company, from August 2000 to August 2001. Portrait Corporation of America, Inc. filed a voluntary petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code in August 2006.

ROBERT G. CHAMBLESS, age 49,50, is Senior Vice President, Sales, Field Operations and Marketing, a position he has held since August 2010. Previously, he was Senior Vice President, Sales, a position he held since June 2008. He held the position of Vice President —- Franchise Sales from early 2003 to June 2008 and Region Sales Manager for our Southern Division between 2000 and 2003. He was Sales Manager in the Company’s Columbia, South Carolina branch between 1997 and 2000. He has served the Company in several other positions prior to this position and was first employed by the Company in 1986.

CLIFFORD M. DEAL, III, age 53,54, is Vice President and Treasurer, a position he has held since June 1999. Previously, he was Director of Compensation and Benefits from October 1997 to May 1999. He was Corporate Benefits Manager from December 1995 to September 1997 and was Manager of Tax Accounting from November 1993 to November 1995.

MORGAN H. EVERETTNORMAN C. GEORGE, age 59,34, is Vice President, BYB Brands, Inc., a wholly-owned subsidiaryposition she has held since January 2016. She has served as a Director of the Company that distributes and markets Tum-E Yummies and other products developed bysince May 2011.  Previously, she was Community Relations Director of the Company, a position he hasshe held since July 2006. PriorJanuary 2009.  She has served the Company in other positions prior to that, hethis position and was Senior Vice President, Chief Marketing and Customer Officer, a position he was appointed tofirst employed by the Company in September 2001. Prior to that, he was Vice President, Marketing and National Sales, a position he was appointed to in December 1999. Prior to that, he was Vice President, Corporate Sales, a position he had held since August 1998. Previously, he was Vice President, Sales for the Carolinas South Region, a position he held beginning in November 1991.2004.

JAMES E. HARRIS,age 52,53, is Senior Vice President, Shared Services and Chief Financial Officer, a position he has held since January 28, 2008. He served as a Director of the Company from August 2003 until January 25, 2008 and was a member of the Audit Committee and the Finance Committee. He served as Executive Vice President and Chief Financial Officer of MedCath Corporation, an operator of cardiovascular hospitals, from December 1999 to January 2008. From 1998 to 1999, he was Chief Financial Officer of Fresh Foods, Inc., a manufacturer of fully cooked food products. From 1987 to 1998, he served in several different officer positions with The Shelton Companies, Inc. He also served two years with Ernst & Young LLP as a senior accountant.

UMESH M. KASBEKAR, age 57,58, is Vice Chairman of the Board of Directors and Secretary of the Company, a position he has held since January 2016 and is Secretary of the Company, a position he has held since August 2012.  Previously he was Senior Vice President, Planning and Administration, a position he has held since January 1995. Prior to that, he was Vice President, Planning, a position he was appointed to in December 1988.

DAVID M. KATZ, age 46,47, is Senior Vice President, a position he has held since January 2013. Previously, he was Senior Vice President Midwest Region for Coca-Cola Refreshments (“CCR”) a position he began inheld since 2011. Prior to the formation of CCR, he was Vice President, Sales Operations for Coca-Cola Enterprises Inc.’s (“CCE”) East Business Unit. In 2008, he was promoted to President and Chief Executive Officer of Coca-Cola Bottlers’ Sales and Services Company, LLC. He began his Coca-Cola career in 1993 with CCE as a Logistics Consultant.

KIMBERLY A. KUO, age 45, is Senior Vice President of Public Affairs, Communications and Communities, a position she has held since January 2016.  Before joining the Company, she operated her own communications and marketing consulting firm, Sterling

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Strategies, from January 2014 to December 2015.  Prior to that, she served as Chief Marketing Officer at Baker and Taylor, a book and entertainment distributor from February 2009 to July 2013.  Prior to her experience at Baker and Taylor, she served in various communications and government affairs roles on Capitol Hill, in political campaigns, trade associations, and corporations.

LAUREN C. STEELE, age 60,61, is Senior Vice President, Corporate Affairs, a position to which he was appointed in March 2012. Prior to that, he was Vice President of Corporate Affairs, a position he had held since May 1989. He is responsible for governmental, media and community relations for the Company.

MICHAEL A. STRONG,age 61,62, is Senior Vice President, Employee Integration and Transition, a position he has held since December 2014. Prior to December 2014, he was Senior Vice President, Human Resources, a position to which he was appointed in March 2011. Previously, he was Vice President of Human Resources, a position to which he was appointed in December 2009. He was Region Sales Manager for the North Carolina West Region from December 2006 to November 2009. Prior to that, he served as Division Sales Manager and General Manager as well as other key sales related positions. He joined the Company in 1985 when the Company acquired Coca-Cola Bottling Company in Mobile, Alabama, where he began his career.

PART II

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PART II

The Company has two classes of common stock outstanding, Common Stock and Class B Common Stock. The Common Stock is traded on the NASDAQ Global Select Market under the symbol COKE. The table below sets forth for the periods indicated the high and low reported sales prices per share of Common Stock. There is no established public trading market for the Class B Common Stock. Shares of Class B Common Stock are convertible on a share-for-share basis into shares of Common Stock.

A quarterly dividend rate of $.25 per share on both Common Stock and Class B Common Stock was maintained throughout 20142015 and 2013.2014. Shares of Common Stock and Class B Common Stock have participated equally in dividends since 1994.

Pursuant to the Company’sCompany's certificate of incorporation, no cash dividend or dividend of property or stock other than stock of the Company, as specifically described in the certificate of incorporation, may be declared and paid on the Class B Common Stock unless an equal or greater dividend is declared and paid on the Common Stock.

The amount and frequency of future dividends will be determined by the Company’sCompany's Board of Directors in light of the earnings and financial condition of the Company at such time, and no assurance can be given that dividends will be declared or paid in the future.

The number of stockholders of record of the Common Stock and Class B Common Stock, as of February 27, 2015,March 4, 2016, was 2,5822,615 and 10, respectively.

On March 3, 20158, 2016 and March 4, 2014,3, 2015, the Compensation Committee determined that 40,000 shares of restricted Class B Common Stock, $1.00 par value, should be issued (pursuant to a Performance Unit Award Agreement approved in 2008) to J. Frank Harrison, III, in connection with his services in 20142015 and 20132014 as Chairman of the Board of Directors and Chief Executive Officer of the Company. As permitted under the terms of the Performance Unit Award Agreement, 19,080 and 19,100, respectively, of such shares were settled in cash to satisfy tax withholding obligations in connection with the vesting of the performance units related to both the 20142015 and 20132014 awards. The shares issued to Mr. Harrison, III were issued without registration under the Securities Act of 1933 (the “Securities Act”) in reliance on Section 4(2)4(a)(2) of the Securities Act.

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Presented below is a line graph comparing the yearly percentage change in the cumulative total return on the Company’s Common Stock to the cumulative total return of the Standard & Poor’s 500 Index and a peer group for the period commencing January 3, 20102, 2011 and ending December 28, 2014.January 3, 2016. The peer group is comprised of Dr Pepper Snapple Group, Inc., The Coca-Cola Company, Cott Corporation, National Beverage Corp. and PepsiCo, Inc.

The graph assumes that $100 was invested in the Company’s Common Stock, the Standard & Poor’s 500 Index and the peer group on January 3, 20102, 2011 and that all dividends were reinvested on a quarterly basis. Returns for the companies included in the peer group have been weighted on the basis of the total market capitalization for each company.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*

Among Coca-Cola Bottling Co. Consolidated, the S&P 500 Index, and a Peer Group

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