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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED March 31, 2022
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM                     TO             

Commission file number 001-33829
kdp-20220331_g1.jpg
Keurig Dr Pepper Inc.
(Exact name of registrant as specified in its charter)
Delaware98-0517725
(State or other jurisdiction of incorporation or organization)(I.R.S. employer identification number)
53 South Avenue
Burlington, Massachusetts
01803
(Address of principal executive offices)
(781) 418-7000
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which registered
Common stockKDPThe Nasdaq Stock Market LLC
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes    No  ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes    No  ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer", "accelerated filer", "smaller reporting company", and "emerging growth company" in Rule 12b-2 of the Securities Exchange Act of 1934.
Large Accelerated Filer Accelerated Filer ☐ Non-Accelerated Filer ☐ Smaller Reporting Company Emerging Growth Company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of 1934). Yes      No    
As of April 26, 2022, there were 1,418,546,832 shares of the registrant's common stock, par value $0.01 per share, outstanding.



KEURIG DR PEPPER INC.
FORM 10-Q
TABLE OF CONTENTS
   Page
 
  
  
  
  
  
12
Investments in Unconsolidated Affiliates
 
 
 
 
 
 
s-i

KEURIG DR PEPPER INC.
MASTER GLOSSARY
TermDefinition
2019 KDP Term Loan$2 billion aggregate principal amount, with the ability to make voluntary and mandatory prepayments, which was originally due on February 8, 2023 and was fully repaid in 2021
2021 364-Day Credit AgreementThe Company's $1,500 million credit agreement, which was entered into on March 26, 2021 and was terminated on February 23, 2022
2022 Revolving Credit AgreementKDP’s $4 billion revolving credit agreement, which was executed in February 2022 and replaced the 2021 364-Day Credit Agreement and the KDP Revolver
A ShocA Shoc Beverage LLC, an equity method investment of KDP, or Adrenaline Shoc energy drinks
ABCThe American Bottling Company, a wholly-owned subsidiary of KDP
ABIAnheuser-Busch InBev SA/NV, the majority owner of Bedford with a 70% interest
Annual Report
Annual Report on Form 10-K for the year ended December 31, 2021
AOCIAccumulated other comprehensive income or loss
ASUAccounting Standards Update
BedfordBedford Systems, LLC, an equity method investment of KDP and the maker of Drinkworks
BodyArmorBA Sports Nutrition, LLC, a former equity method investment of KDP
bpsbasis points
CARES Act
U.S. Coronavirus Aid, Relief and Economic Security Act
CSDCarbonated soft drink
DIODays inventory outstanding
DPODays of payables outstanding
DPSDr Pepper Snapple Group, Inc.
DPS MergerThe combination of the business operations of Keurig and DPS that was consummated on July 9, 2018 through a reverse merger transaction, whereby a wholly-owned special purpose merger subsidiary of DPS merged with and into the direct parent of Keurig
DSDDirect Store Delivery, the operating segment whereby finished beverages are delivered directly to retailers
DSODays sales outstanding
EPSEarnings per share
Exchange ActSecurities Exchange Act of 1934, as amended
FFSFountain Foodservice, an operating segment of KDP which serves the fountain channel, such as restaurants
FASBFinancial Accounting Standards Board
FXForeign exchange
GoldmanGoldman Sachs & Co. LLC
IRiInformation Resources, Inc.
KDPKeurig Dr Pepper Inc.
KDP RevolverThe Company's $2,400 million revolving credit facility, which was entered into on February 28, 2018 and terminated on February 23, 2022.
KeurigKeurig Green Mountain, Inc., a wholly-owned subsidiary of KDP, and the brand of our brewers
LIBORLondon Interbank Offered Rate
NCBNon-carbonated beverage
NotesCollectively, the Company's senior unsecured notes
PETPolyethylene terephthalate, which is used to make the Company's plastic bottles
Proposition 65The State of California's Safe Drinking Water and Toxic Enforcement Act of 1986
RSURestricted share unit
RTDReady to drink
RVGResidual value guarantee
SECSecurities and Exchange Commission
SG&ASelling, general and administrative
SOFRSecured Overnight Financing Rate
U.S. GAAPAccounting principles generally accepted in the U.S.
Veyron SPEsSpecial purpose entities with the same sponsor, Veyron Global
VIEVariable interest entity
Vita CocoThe Vita Coco Company, Inc.
WDWarehouse Direct, the operating segment whereby finished beverages are shipped to retailer warehouses, and then delivered by the retailer through its own delivery system to its stores
s-ii

PART I - FINANCIAL INFORMATION
ITEM 1.Financial Statements (Unaudited)

KEURIG DR PEPPER INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
 First Quarter
(in millions, except per share data)20222021
Net sales$3,078 $2,902 
Cost of sales1,428 1,302 
Gross profit1,650 1,600 
Selling, general and administrative expenses1,018 961 
Gain on litigation settlement(299) 
Other operating income, net(35)(1)
Income from operations966 640 
Interest expense188 140 
Loss on early extinguishment of debt48 105 
Gain on sale of equity method investment(50) 
Impairment of investments and note receivable6  
Other expense (income), net9 (3)
Income before provision for income taxes765 398 
Provision for income taxes180 73 
Net income including non-controlling interest585 325 
Less: Net loss attributable to non-controlling interest  
Net income attributable to KDP$585 $325 
Earnings per common share:  
Basic$0.41 $0.23 
Diluted0.41 0.23 
Weighted average common shares outstanding:  
Basic1,418.2 1,409.2 
Diluted1,429.7 1,425.6 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

1

KEURIG DR PEPPER INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)
 First Quarter
(in millions)20222021
Net income including non-controlling interest$585 $325 
Other comprehensive income
Foreign currency translation adjustments99 16 
Net change in cash flow hedges, net of tax of $48 and $22, respectively
142 71 
Total other comprehensive income241 87 
Comprehensive income including non-controlling interest826 412 
Less: Comprehensive income attributable to non-controlling interest  
Comprehensive income attributable to KDP$826 $412 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

2

KEURIG DR PEPPER INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
 March 31,December 31,
(in millions, except share and per share data)20222021
Assets
Current assets:  
Cash and cash equivalents$592 $567 
Restricted cash and cash equivalents2 1 
Trade accounts receivable, net1,214 1,148 
Inventories1,045 894 
Prepaid expenses and other current assets637 447 
Total current assets3,490 3,057 
Property, plant and equipment, net2,436 2,494 
Investments in unconsolidated affiliates29 30 
Goodwill20,243 20,182 
Other intangible assets, net23,889 23,856 
Other non-current assets1,119 937 
Deferred tax assets38 42 
Total assets$51,244 $50,598 
Liabilities and Stockholders' Equity
Current liabilities:  
Accounts payable$4,510 $4,316 
Accrued expenses1,028 1,110 
Structured payables143 142 
Short-term borrowings and current portion of long-term obligations 304 
Other current liabilities767 613 
Total current liabilities6,448 6,485 
Long-term obligations11,584 11,578 
Deferred tax liabilities6,054 5,986 
Other non-current liabilities1,647 1,577 
Total liabilities25,733 25,626 
Commitments and contingencies
Stockholders' equity:  
Preferred stock, $0.01 par value, 15,000,000 shares authorized, no shares issued
  
Common stock, $0.01 par value, 2,000,000,000 shares authorized, 1,418,462,239 and 1,418,119,197 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively
14 14 
Additional paid-in capital21,764 21,785 
Retained earnings3,518 3,199 
Accumulated other comprehensive income (loss)215 (26)
Total stockholders' equity25,511 24,972 
Non-controlling interest  
Total equity25,511 24,972 
Total liabilities and equity$51,244 $50,598 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
3

KEURIG DR PEPPER INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
 First Quarter
(in millions)20222021
Operating activities:  
Net income attributable to KDP$585 $325 
Adjustments to reconcile net income to net cash provided by operating activities:  
Depreciation expense106 102 
Amortization of intangibles34 33 
Other amortization expense42 40 
Provision for sales returns12 19 
Deferred income taxes8 11 
Employee stock-based compensation expense(15)25 
Loss on early extinguishment of debt48 105 
Gain on sale of equity method investment(50) 
Gain on disposal of property, plant and equipment(38)(1)
Unrealized gain on foreign currency(11)(10)
Unrealized gain on derivatives (41)
Equity in loss of unconsolidated affiliates3  
Impairment on investments and note receivable of unconsolidated affiliate6  
Other, net13 15 
Changes in assets and liabilities:  
Trade accounts receivable(73)(37)
Inventories(147)(77)
Income taxes receivable and payables, net135 25 
Other current and non-current assets(284)(295)
Accounts payable and accrued expenses151 121 
Other current and non-current liabilities138 186 
Net change in operating assets and liabilities(80)(77)
Net cash provided by operating activities663 546 
Investing activities:  
Proceeds from sale of investment in unconsolidated affiliates50  
Purchases of property, plant and equipment(109)(95)
Proceeds from sales of property, plant and equipment78 7 
Purchases of intangibles(10)(12)
Issuance of related party note receivable(6) 
Investments in unconsolidated affiliates(3) 
Other, net3 1 
Net cash provided by (used in) investing activities$3 $(99)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
4

KEURIG DR PEPPER INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED, CONTINUED)
 First Quarter
(in millions)20222021
Financing activities:  
Proceeds from issuance of Notes
$ $2,150 
Repayments of Notes
(201)(1,845)
Proceeds from issuance of commercial paper 120 
Repayments of commercial paper(149)(120)
Repayments of 2019 KDP Term Loan
 (425)
Proceeds from structured payables38 35 
Repayments of structured payables(37)(41)
Cash dividends paid(265)(192)
Proceeds from issuance of common stock 140 
Tax withholdings related to net share settlements(5)(125)
Payments on finance leases(20)(15)
Other, net(5)(37)
Net cash used in financing activities(644)(355)
Cash, cash equivalents, and restricted cash and cash equivalents:  
Net change from operating, investing and financing activities22 92 
Effect of exchange rate changes4 2 
Beginning balance568 255 
Ending balance$594 $349 
Supplemental cash flow disclosures of non-cash investing activities:
Capital expenditures included in accounts payable and accrued expenses$139 $259 
Supplemental cash flow disclosures of non-cash financing activities:
Dividends declared but not yet paid266 232 
Supplemental cash flow disclosures:
Cash paid for interest27 29 
Cash paid for income taxes37 31 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
5

KEURIG DR PEPPER INC.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
(UNAUDITED)

 Common Stock IssuedAdditional
Paid-In Capital
Retained EarningsAccumulated Other Comprehensive Income (Loss)Total Stockholders' EquityNon-controlling InterestTotal
Equity
(in millions, except per share data)SharesAmount
Balance as of January 1, 20221,418.1 $14 $21,785 $3,199 $(26)$24,972 $ $24,972 
Net income   585  585  585 
Other comprehensive income    241 241  241 
Dividends declared, $0.1875 per share
   (266) (266) (266)
Shares issued under employee stock-based compensation plans and other0.4        
Tax withholdings related to net share settlements  (5)  (5) (5)
Stock-based compensation and stock options exercised  (16)  (16) (16)
Balance as of March 31, 2022
1,418.5 $14 $21,764 $3,518 $215 $25,511 $ $25,511 



 Common Stock IssuedAdditional
Paid-In Capital
Retained EarningsAccumulated Other Comprehensive Income (Loss)Total Stockholders' EquityNon-controlling InterestTotal Equity
(in millions, except per share data)SharesAmount
Balance as of January 1, 2021
1,407.3 $14 $21,677 $2,061 $77 $23,829 $1 $23,830 
Net income— — — 325 — 325 — 325 
Other comprehensive loss— — — — 87 87 — 87 
Dividends declared, $0.15 per share
— — — (212)— (212)— (212)
Issuance of common stock4.3 — 140 — — 140 — 140 
Shares issued under stock-based compensation plans and other5.7 — — — — — — — 
Tax withholdings related to net share settlements— — (125)— — (125)— (125)
Stock-based compensation and stock options exercised— — 26 — — 26 — 26 
Balance as of March 31, 2021
1,417.3 $14 $21,718 $2,174 $164 $24,070 $1 $24,071 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
6

KEURIG DR PEPPER INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

1. General
ORGANIZATION
References in this Quarterly Report on Form 10-Q to "KDP" or "the Company" refer to Keurig Dr Pepper Inc. and all entities included in the unaudited condensed consolidated financial statements. Definitions of terms used in this Quarterly Report on Form 10-Q are included within the Master Glossary.
This Quarterly Report on Form 10-Q refers to some of KDP's owned or licensed trademarks, trade names and service marks, which are referred to as the Company's brands. All of the product names included herein are either KDP registered trademarks or those of the Company's licensors.
BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete consolidated financial statements. In the opinion of management, all adjustments, consisting principally of normal recurring adjustments, considered necessary for a fair presentation have been included. These unaudited condensed consolidated financial statements should be read in conjunction with KDP's consolidated financial statements and accompanying notes included in the Company's Annual Report.
References to the "first quarter" indicate the Company's quarterly periods ended March 31, 2022 and 2021.
PRINCIPLES OF CONSOLIDATION
KDP consolidates all wholly owned subsidiaries.
The Company consolidates investments in companies in which it holds the majority interest. In these cases, the third party equity interest is referred to as non-controlling interest. Non-controlling interest is presented as a separate component within equity in the unaudited Condensed Consolidated Balance Sheets, and net income attributable to the non-controlling interest is presented separately in the unaudited Condensed Consolidated Statements of Income.
The Company would be required to consolidate VIEs for which KDP has been determined to be the primary beneficiary. To determine if KDP is the primary beneficiary, the Company assesses whether it has the power to direct the significant activities of the VIE and the obligation to absorb losses or receive benefits from the VIE that may be significant to the VIE. The Company has determined that it is not the primary beneficiary of any VIEs. However, future events may require the Company to consolidate VIEs if the Company becomes the primary beneficiary.
The Company uses the equity method to account for investments in companies if the investment provides KDP with the ability to exercise significant influence over operating and financial policies of the investee. Consolidated net income includes KDP's proportionate share of the net income or loss of these companies. Judgment regarding the level of influence over each equity method investment includes considering key factors such as ownership interest, representation on the board of directors or similar governing body, participation in policy-making decisions and material intercompany transactions.
KDP eliminates from its financial results all intercompany transactions between entities included in the unaudited condensed consolidated financial statements.
USE OF ESTIMATES
The process of preparing KDP's unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires the use of estimates and judgments that affect reported amounts. These estimates and judgments are based on historical experience, future expectations and other factors and assumptions the Company believes to be reasonable under the circumstances. These estimates and judgments are reviewed on an ongoing basis and are revised when necessary. Changes in estimates are recorded in the period of change. Actual amounts may differ from these estimates.
SIGNIFICANT ACCOUNTING POLICY CHANGES
Prior to January 1, 2022, the Company recorded forfeitures as incurred. Effective January 1, 2022, the Company changed its accounting policy election to record expense only for awards expected to vest. Estimated forfeiture rates are based on historical data and are periodically reassessed. The cumulative effect of this change in accounting policy was recorded effective January 1, 2022. The impact of forfeitures on stock-based compensation has historically been insignificant to the Company.
7

KEURIG DR PEPPER INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED, CONTINUED)
RECLASSIFICATIONS
KDP reclassified amounts in the unaudited condensed consolidated financial statements for the first quarter of 2021 in order to conform to current year presentation, as follows:
Statement of Cash Flows
(in millions)First Quarter
Current PresentationPrior Presentation2021
Proceeds from issuance of commercial paperNet payment of commercial paper$120 
Repayments of commercial paperNet payment of commercial paper(120)
Statement of Changes in Stockholders’ Equity
(in millions)First Quarter
Current PresentationPrior Presentation2021
Tax withholdings related to net share settlementsStock-based compensation and stock options exercised$(125)
Stock-based compensation and stock options exercisedStock-based compensation and stock options exercised26 
UNALLOCATED CORPORATE COST ALIGNMENT
Effective January 1, 2022, the Company updated its presentation of certain of KDP's unallocated corporate costs, primarily related to IT, to be aligned among the Company's segments and to more consistently reflect controllable costs at the segment level. Refer to Note 6 for current year presentation. The following table summarizes the revised and prior presentations of income from operations at the segment level:
(in millions)
First Quarter 2021
Segment Results – Income from operationsCurrent PresentationPrior Presentation
Coffee Systems$368 $336 
Packaged Beverages179 175 
Beverage Concentrates238 238 
Latin America Beverages22 22 
Unallocated corporate costs(167)(131)
Income from operations$640 $640 
2. Long-term Obligations and Borrowing Arrangements
The following table summarizes the Company's long-term obligations:
(in millions)March 31, 2022December 31, 2021
Notes
$11,584 $11,733 
Less: current portion of long-term obligations (155)
Long-term obligations$11,584 $11,578 
The following table summarizes the Company's short-term borrowings and current portion of long-term obligations:
(in millions)March 31, 2022December 31, 2021
Commercial paper notes$ $149 
Current portion of long-term obligations 155 
Short-term borrowings and current portion of long-term obligations$ $304 

8

KEURIG DR PEPPER INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED, CONTINUED)
SENIOR UNSECURED NOTES 
The Company's Notes consisted of the following:
(in millions, except %)
IssuanceMaturity DateRateMarch 31, 2022December 31, 2021
2023 Merger Notes(3)
May 25, 20234.057%$1,000 $1,000 
2023 NotesDecember 15, 20233.130%500 500 
2024 NotesMarch 15, 20240.750%1,150 1,150 
2025 Merger Notes(3)
May 25, 20254.417%1,000 1,000 
2025 NotesNovember 15, 20253.400%500 500 
2026 NotesSeptember 15, 20262.550%400 400 
2027 NotesJune 15, 20273.430%500 500 
2028 Merger Notes(3)
May 25, 20284.597%2,000 2,000 
2030 NotesMay 1, 20303.200%750 750 
2031 NotesMarch 15, 20312.250%500 500 
2038 Notes(1)
May 1, 20387.450% 125 
2038 Merger Notes(3)
May 25, 20384.985%500 500 
2045 NotesNovember 15, 20454.500%550 550 
2046 NotesDecember 15, 20464.420%400 400 
2048 Merger Notes(3)
May 25, 20485.085%750 750 
2050 NotesMay 1, 20503.800%750 750 
2051 NotesMarch 15, 20513.350%500 500 
Principal amount11,750 11,875 
Adjustment from principal amount to carrying amount(2)
(166)(142)
Carrying amount$11,584 $11,733 
(1)On January 24, 2022, KDP redeemed and retired the remainder of its 2038 Notes. The loss on early extinguishment of the 2038 Notes was approximately $45 million, comprised of the make-whole premium and the write-off of the associated unamortized fair value adjustment related to the DPS Merger.
(2)The carrying amount includes unamortized discounts, debt issuance costs and fair value adjustments related to the DPS Merger.
(3)Subsequent to March 31, 2022, KDP undertook a strategic refinancing and issued approximately $3 billion of Notes. The proceeds from the issuance were used to voluntarily prepay and retire several tranches of our existing Notes. Refer to Note 17 for additional information.
VARIABLE-RATE BORROWING ARRANGEMENTS
The following table summarizes information about the 2022 Revolving Credit Agreement:
(in millions)March 31, 2022December 31, 2021
IssuanceMaturity DateCapacityCarrying ValueCarrying Value
2022 Revolving Credit Agreement(1)
February 23, 2027$4,000 $ $ 
(1)The 2022 Revolving Credit Agreement has $200 million letters of credit available, none of which were utilized as of March 31, 2022.
On February 23, 2022, KDP terminated the 2021 364-Day Credit Agreement and the KDP Revolver. The loss on early extinguishment of these instruments was approximately $3 million, comprised of termination fees and the write-off of the associated deferred financing fees. There were no amounts drawn upon the 2021 364-Day Credit Agreement or the KDP Revolver prior to termination.
Also on February 23, 2022, KDP entered into the 2022 Revolving Credit Agreement among KDP, as borrower, the lenders from time to time party thereto and JPMorgan Chase, Bank, N.A., as administrative agent. The 2022 Revolving Credit Agreement provides for a $4 billion revolving credit facility, including a letter of credit sub-facility in an aggregate principal amount of up to $200 million. The Company incurred approximately $4 million in deferred financing fees related to the issuance. The 2022 Revolving Credit Agreement will mature in February 2027.
The 2022 Revolving Credit Agreement replaced the KDP Revolver and the 2021 364-Day Credit Agreement and the proceeds of the credit facility are intended to be used for working capital and for other general corporate purposes of KDP.
9

KEURIG DR PEPPER INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED, CONTINUED)
Borrowings under the 2022 Revolving Credit Agreement will bear interest at a rate per annum equal to, at KDP's option, an adjusted SOFR rate plus a margin of 0.875% to 1.500% or a base rate plus a margin of 0.000% to 0.500%, in each case, depending on the rating of certain index debt of KDP. The 2022 Revolving Credit Agreement contains customary representations and warranties for investment grade financings. The 2022 Revolving Credit Agreement also contains (i) certain customary affirmative covenants, including those that impose certain reporting and/or performance obligations on KDP and its subsidiaries, (ii) certain customary negative covenants that generally limit, subject to various exceptions, KDP and its subsidiaries from taking certain actions, including, without limitation, incurring liens, consummating certain fundamental changes and entering into transactions with affiliates, (iii) a financial covenant in the form of a minimum interest coverage ratio (as defined therein) of 3.25 to 1.00 and (iv) customary events of default (including a change of control) for financings of this type.
As of March 31, 2022, KDP was in compliance with its minimum interest coverage ratio relating to the 2022 Revolving Credit Agreement.
Commercial Paper Program
The following table provides information about the Company's borrowings under its commercial paper program:
First Quarter
(in millions, except %)20222021
Weighted average commercial paper borrowings$45 $22 
Weighted average borrowing rates0.30 %0.18 %
Letter of Credit Facility
In addition to the portion of the 2022 Revolving Credit Agreement reserved for issuance of letters of credit, KDP has an incremental letter of credit facility. Under this facility, $150 million is available for the issuance of letters of credit, $96 million of which was utilized as of March 31, 2022 and $54 million of which remains available for use.
FAIR VALUE DISCLOSURES
The fair value of KDP's commercial paper approximates the carrying value and are considered Level 2 within the fair value hierarchy.
The fair values of KDP's Notes are based on current market rates available to KDP and are considered Level 2 within the fair value hierarchy. The difference between the fair value and the carrying value represents the theoretical net premium or discount that would be paid or received to retire all the Notes and related unamortized costs to be incurred at such date. The fair value of KDP's Notes was $11,868 million and $13,078 million as of March 31, 2022 and December 31, 2021, respectively.
3. Goodwill and Other Intangible Assets
GOODWILL
Changes in the carrying amount of goodwill by reportable segment are as follows:
(in millions)Coffee SystemsPackaged BeveragesBeverage ConcentratesLatin America BeveragesTotal
Balance as of January 1, 2022$9,800 $5,319 $4,539 $524 $20,182 
Foreign currency translation31 8 5 17 61 
Balance as of March 31, 2022$9,831 $5,327 $4,544 $541 $20,243 
INTANGIBLE ASSETS OTHER THAN GOODWILL
The net carrying amounts of intangible assets other than goodwill with indefinite lives are as follows:
(in millions)March 31, 2022December 31, 2021
Brands(1)
$19,920 $19,865 
Trade names2,480 2,480 
Contractual arrangements123 123 
Distribution rights(2)
95 85 
Total$22,618 $22,553 
(1)The increase of $55 million in brands with indefinite lives was due to foreign currency translation during the first quarter of 2022.
(2)The Company executed three agreements to acquire distribution rights during the first quarter of 2022, which resulted in an increase of approximately $10 million.
10

KEURIG DR PEPPER INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED, CONTINUED)

The net carrying amounts of intangible assets other than goodwill with definite lives are as follows:
March 31, 2022December 31, 2021
(in millions) Gross AmountAccumulated AmortizationNet Amount Gross AmountAccumulated AmortizationNet Amount
Acquired technology$1,146 $(419)$727 $1,146 $(401)$745 
Customer relationships639 (178)461 638 (169)469 
Trade names128 (90)38 128 (86)