Cott Corporation



 





Exhibit 10.2




Tuesday July 31, 2007




WITHOUT PREJUDICE




DELIVERED TO:




John Dennehy




Dear John




Re: Cott Corporation (“Cott”) — Termination of Employment



We are writing to notify you that your employment with Cott is hereby terminated without cause,
effective August 31st 2007.



Cott appreciates your contribution to the corporation and with a view to resolving all matters on
an amicable basis, has prepared the following severance arrangements:





	1.	 	Date of Termination




The effective date of termination of employment is August 31st, 2007 (the “Termination
Date”).





	2.	 	Accrued Salary and Vacation Pay




You will be paid your salary and accrued vacation pay to the Termination Date. These payments will
be less applicable statutory deductions and withholdings and paid in a lump-sum payment during the
next pay period immediately following the Termination Date.





	3.	 	Severance Payment and Out-Placement




As outlined in your Retention, Severance and Non-Competition Plan Agreement dated May 11, 2007 and
in the Amended and Restated Retention, Severance and Non-Competition Plan dated June 25, 2007
(Collectively, the “Retention Agreement”) we have agreed to pay you a lump-sum payment equal to 2
times your annual base salary, car allowance, bonus at target and a prorated bonus for the current
bonus year, as outlined below. You will receive these payments on the next pay run after your
Termination Date. Such payments will be made on the basis that you will continue to perform your
duties and our agreement to make such payments will be null and void if the reason for termination
is Cause or resignation without Good Reason (as such terms are defined in the Retention Agreement)
before the Termination Date.



The payment will be equal to $2,050,236 (less applicable withholdings), calculated as
follows;



Annual Base Salary ($386,250) + Car Allowance ($16,000) + Bonus @ Target ($386,250) + Replacement
Benefit Costs ($7,868 — for the Annual Executive Medical) Total $796,368



Multiple by 2 X = $1,592,736 + Plus Pro-rated Bonus @ Target equal to 8 months ($257,500)
and one off payment for relocation costs of $200,000 to equal the total of $2,050,236.




 









 







Your Performance Share Units (PSU) awards in 2006 and 2007 will be vested based on a pro rated
basis based on your target (100%) award, is 2/3 of the 2006 award at target and 1/3rd of
the 2007 award at target will be vested (totalling 43,710 PSU’s, in the aggregate), subject to, and
without any limitation to, any additional rights you may have under the Retention Agreement,
including without limitation, additional rights arising on a Change of Control during a Change of
Control Window (as such terms are defined in the Retention Agreement).Your pro rata entitlement
described above will be paid to you on the first pay period following August 31st 2007
as a cash payment based on the closing price of the Cott Stock on the TSX on your Termination Date
(subject to adjustment under the terms of the Retention Agreement arising on a Change in Control
during a Change of Control Window). Such amounts will be less applicable withholdings.



In addition, we will pay for the cost of the following outplacement services for a maximum of six
(6) months with Right Management Consultants: Executive Service. The outplacement services will
not be available to you after December 31, 2009.





	4.	 	Benefits




We confirm that the following benefits will continue for a period of 24 months following the
Termination Date or until alternative employment is secured that provides comparable benefits:
Extended Health Care, Dental and Vision, Basic Life and AD&D, Executive Life Insurance and
Executive Long Term Care Insurance. All other benefits will terminate effective August
31st 2007.





	5.	 	Expenses




To the extent that you have incurred any proper travel, entertainment or other business expenses,
you will be reimbursed in accordance with Cott’s policy. All expense reports must be submitted
within 30 days of your Termination Date.





	6.	 	Stock Options/Share Purchase Plan/DPSP/RSP




All of your rights with respect to vested stock options that you hold personally will continue
after the termination of your employment, subject to the provisions of the Cott’s Restated 1986
Common Share Option Plan as amended (the “Option Plan”), for 60 days following the Termination
Date, and thereafter such options shall be null and void.



All other rights under Cott’s share purchase plans (other than the PSU Plan under which your
entitlement shall be as described as above) and other long-term incentive plans, including, without
limitation, all rights to unvested shares under the 401k Plan and Employee Share Purchase Plan
shall terminate on the Termination Date in accordance with those plans. Rights under these plans
that have vested as of the Termination Date will continue in accordance with and subject to the
terms of the applicable plans.





	7.	 	No Other Payments




Other than as set out in Section 7 of the Retention Agreement, the payments and other entitlements
set out in this letter, including the attached schedules, constitute your complete entitlement and
Cott’s complete obligations whatsoever, including with respect to the cessation of your employment,
whether at common law, statute or contract. For greater certainty, we confirm that, other than as




2









 







set out in Section 7 of the Retention Agreement, you are not entitled to any further payment (including
any bonus payments), benefits, perquisites, allowances or entitlements earned or owing to you from
Cott pursuant to any employment or any other agreement, whether written or oral, whatsoever, all
having ceased on the Termination Date without further obligation from Cott. All amounts paid to
you pursuant to this letter shall be deemed to include all amounts owing pursuant to the Employment
Standards Act, 2000 and any applicable state wage payment or wage collection law, and such payments
represent a greater right or benefit than that required under the Employment Standards Act, 2000
and any applicable state wage payment or wage collection law.





	8.	 	Resignation & Release




You will resign as an officer and director of Cott (and any direct and indirect affiliates,
subsidiaries and associated companies) with effect as of the Termination Date. In this respect,
you agree to execute and deliver the Resignation Notice attached hereto as Schedule “1” and such
further documentation as may be required by Cott, in its sole discretion, in order to effect this
resignation. You agree to sign the Release Agreement in the form attached as Schedule “2” to this
letter, which is a condition precedent to you receiving any severance payments hereunder that are
in excess of payments required by statute.





	9.	 	Your Continuing Obligations






	 	(a)	 	You will continue to abide by all of the provisions of your Employment
Agreement through the Termination Date, and with all of the provisions of the
Retention Agreement through the Termination Date and thereafter following the
cessation of your employment in accordance with and subject to the terms of the
Retention Agreement and this letter agreement.
	 
	 	(b)	 	You are required to return to Cott within five (5) business days of the
Termination Date all of the property of Cott in your possession or in the possession
of your family or agents including, without limitation, wireless devices and
accessories, computer and office equipment, keys, passes, credit cards, customer
lists, sales materials, manuals, computer information, software and codes, files and
all documentation (and all copies thereof) dealing with the finances, operations and
activities of Cott, its clients, employees or suppliers.
	 
	 	(c)	 	You will maintain the severance arrangements as set out in this letter in the
strictest confidence and will not disclose them except to your immediate family, or to
the extent that such disclosure may be required by law, or to permit you to obtain tax
planning, legal or similar advice
	 
	 	(d)	 	You will agree to cooperate reasonably with Cott, and its legal advisors, at
Cott’s request, direction and reasonable cost, in connection with: (i) any Cott
business matters in which you were involved during your employment with Cott; or (ii)
any existing or potential claims, investigations, administrative proceedings, lawsuits
and other legal and business matters which arose during your employment involving
Cott; (iii) effecting routine administrative compliance with respect to any regulatory
requirements that were applicable to Cott during the period of your employment; and
(iv) completing any further documents required to give effect to the terms set out in
this letter with respect to which you have knowledge of the underlying facts.




3









 








	 	(e)	 	You agree to indemnify and hold harmless Cott and its Affiliates (as defined
in the Retention Agreement), together with its and their respective officers,
directors and employees, from and against any and all damages, taxes, penalties,
interest, expenses and any other costs imposed under, in connection with, or related
to Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), with
respect to payments and benefits provided pursuant to this letter agreement including,
but not limited to, any penalties associated with failure to report or failure to
withhold.






	10.	 	Taxes




All payments referred to in this letter will be less applicable withholdings and deductions, and
you shall be responsible for all tax liability resulting from your receipt of the payment and
benefits referred to in this letter, except (i) to the extent that Cott has withheld funds for
remittance to statutory authorities, and (ii) to the extent provided otherwise in your Retention
Agreement with respect to any Gross-Up Payment. For greater certainty, we confirm that Section 7
of the Retention Agreement provides for a Gross-Up Payment in connection with any excise tax
imposed under Section 4999 of the Code and not in connection with any tax, penalty or interest
imposed under (or in connection with) Section 409A of the Code. In no event are you entitled to
any payment from Cott with respect to any tax, penalty or interest imposed under (or in connection
with) Section 409A of the Code, and in no event shall any such tax, penalty or interest be taken
into account for purposes of determining the amount of any payment due under Section 7 of the
Retention Agreement.





	11.	 	General






	 	(a)	 	Entire Agreement:   The agreement confirmed by this letter and the
attached schedules constitutes the entire agreement between you and Cott with
reference to any of the matters herein provided or with reference to your employment
or office with Cott, or the cessation thereof. All promises, representations,
collateral agreements, offers and understandings not expressly incorporated in this
letter agreement are hereby superseded and have no further effect. For greater
certainty, your entitlement under Section 7 of the Retention Agreement is expressly
incorporated in this letter.
	 
	 	(b)	 	Severability:   The provisions of this letter agreement shall be
deemed severable, and the invalidity or unenforceability of any provision set out
herein shall not affect the validity or enforceability of the other provisions hereof,
all of which shall continue in accordance with their terms.
	 
	 	(c)	 	Full Understanding:   By signing this letter, you confirm that: (i)
you have had an adequate opportunity to read and consider the terms set out herein,
including the Release Agreement attached, and that you fully understand them and their
consequences; (ii) you have been advised, through this paragraph, to consult with
legal counsel and have obtained such legal or other advice as you consider advisable
with respect to this letter agreement, including attachments; (iii) you have
consulted with legal counsel regarding the application of Section 409A of the Code to
the payments and benefits provided pursuant to this letter agreement; (iv) you are
signing this letter voluntarily, without coercion, and without reliance on any
representation, express or implied, by Cott, or by any director, trustee, officer,
shareholder, employee or other representative of Cott; and (v) you have been
provided with the 45-day consideration period and seven-day revocation period
described in the attached Release Agreement.




4









 








	 	(d)	 	Arbitration:   In the event any dispute arises between you and Cott
with respect to the interpretation, effect or construction of any provisions of this
Agreement, either Cott or you may refer the matter to final and binding arbitration
without right of appeal, pursuant to the United States Federal Arbitration Act, as
applicable, for the disputed matters to be determined by an arbitrator that is to be
mutually agreed upon, upon written notice to the other, whereupon, subject to the
availability of such an arbitrator, the arbitration hearing will commence within 30
days of the said notice, without formality, with the costs of the arbitration to be
shared equally between the parties, subject to such order for costs as the arbitrator
may determine in his or her sole discretion. The arbitration shall be conducted
pursuant to the then-existing rules and regulations of the American Arbitration
Association to the extent not inconsistent with this letter agreement.
	 
	 	(e)	 	Currency:   All dollar amounts set forth or referred to in this letter
refer to US currency.
	 
	 	(f)	 	Governing Law:   To the extent the laws of the United States must
apply, the agreement confirmed by this letter shall be governed by the laws of the
State of Florida.





* * *



If this offer is acceptable to you once you have had an opportunity to review it, please sign the
acknowledgement below to confirm your acceptance of same and return to Sher Zaman at Queens Quay.



If you have any questions regarding the terms set out in this letter, please feel free to contact
myself or Sher Zaman.




Yours very truly,




COTT CORPORATION




Per:




/s/ Abilio Gonzalez




 






Enclosures:

1.   Schedule “1” — Resignation Notice

2.   Schedule “2” — Release Agreement




5









 








Acknowledgement and Acceptance



I acknowledge that I have been provided 45 days to review this letter and the attached Release
Agreement and Resignation Notice, which I acknowledge is a reasonable period of time, and seven
days thereafter to revoke the letter agreement and attached Release Agreement, if I so choose. I
also acknowledge that I have been advised, by this paragraph, and have had the opportunity to
obtain independent legal advice and that the only consideration for the attached Release Agreement
is as referred to in this letter and the Release Agreement. I confirm that no other promises or
representations of any kind have been made to me to cause me to sign this acknowledgement and
acceptance.



 




	 	 	 
	/s/  John Dennehy 

	 	August 8, 2007 

	John Dennehy
	 	Date






6









 






SCHEDULE “1”




RESIGNATION NOTICE





	TO: 	 	COTT CORPORATION
	 
	AND TO: 	 	ALL DIRECT AND INDIRECT AFFILIATES, SUBSIDIARIES AND
ASSOCIATED COMPANIES THEREOF
	 
	AND TO: 	 	ALL DIRECTORS THEREOF




 




I, John Dennehy confirm my resignation as a director and from all offices held by me of Cott
Corporation, including all direct and indirect affiliates, subsidiaries, and associated companies,
with effect as of August 31, 2007.




 

John Dennehy




7









 





SCHEDULE “2”




RELEASE AGREEMENT




     In consideration of the mutual promises, payments and benefits provided for in the annexed
Cott Corporation Retention Severance and Non Competition Plan and the letter dated July 31, 2007
to which this Release Agreement is a Schedule (collectively, the “Plan”), and the release from
John Dennehy (the “Employee”) set forth herein, Cott Corporation (the “Corporation”) and the
Employee agree to the terms of this Release Agreement. Capitalized terms used and not defined in
this Release Agreement shall have the meanings assigned thereto in the Plan.




     1.   The Employee acknowledges and agrees that the Corporation is under no obligation to offer
the Employee the payments and benefits set forth in the annexed Plan, unless the Employee consents
to the terms of this Release Agreement. The Employee further acknowledges that he/she is under no
obligation to consent to the terms of this Release Agreement and that the Employee has entered
into this agreement freely and voluntarily.




     2.   In consideration of the payment and benefits set forth in the annexed Plan and the
Corporation’s release set forth in paragraph 5, the Employee voluntarily, knowingly and willingly
releases and forever discharges the Corporation and its Affiliates, together with its and their
respective officers, directors, partners, shareholders, employees and agents, and each of its and
their predecessors, successors and assigns (collectively, “Releasees”), from any and all charges,
complaints, claims, promises, agreements, controversies, causes of action and demands of any nature
whatsoever that the Employee or his/her executors, administrators, successors or assigns ever had,
now have or hereafter can, shall or may have against the Releasees by reason of any matter, cause
or thing whatsoever arising prior to the time of signing of this Release Agreement by the Employee.
The release being provided by the Employee in this Release Agreement includes, but is not limited
to, any rights or claims relating in any way to the Employee’s employment relationship with the
Corporation or any its Affiliates, or the termination thereof, or under any statute, including, but
not limited to the Employment Standards Act, 2000, the Human Rights Code, the Workplace Safety and
Insurance Act re-employment provisions, the Occupational Health & Safety Act, the Pay Equity Act,
the Labour Relations Act, Title VII of the Civil Rights Act of 1964, the Age Discrimination in
Employment Act, as amended by the Older Workers’ Benefit Protection Act, the Family and Medical
Leave Act, and the Americans With Disabilities Act, or pursuant to any other applicable law or
legislation governing or related to his/her employment or other engagement with the Corporation. In
no event shall this Release apply to the Employee’s right, if any, to indemnification, under the
Employee’s employment agreement or otherwise, that is in effect on the date of this Release and, if
applicable, to the Corporation’s obligation to maintain in force reasonable director and officer
insurance in respect of such indemnification obligations.




     3.   The Employee acknowledges and agrees that he/she shall not, directly or indirectly, seek or
further be entitled to any personal recovery in any lawsuit or other claim against the Corporation
or any other Releasee based on any event arising out of the matters released in paragraph 2.



8









 






     4.   Nothing herein shall be deemed to release: (i) any of the Employee’s rights under the
Plan; or (ii) any of the vested benefits that the Employee has accrued prior to the date this
Release Agreement is executed by the Employee under the employee benefit plans and arrangements of
the Corporation or any of its Affiliates; or (iii) any claims that may arise after the date this
Release Agreement is executed.




     5.   In consideration of the Employee’s release set forth in paragraph 2, the Corporation
knowingly and willingly releases and forever discharges the Employee from any and all charges,
complaints, claims, promises, agreements, controversies, causes of action and demands of any
nature whatsoever that the Corporation now has or hereafter can, shall or may have against him/her
by reason of any matter, cause or thing whatsoever arising prior to the time of signing of this
Release Agreement by the Corporation, provided, however, that nothing herein is intended to
release any claim the Corporation may have against the Employee for any illegal conduct or
arising out of any illegal conduct.




     6.   The Employee acknowledges that he/she has carefully read and fully understands all of the
provisions and effects of the Plan and this Release Agreement. The Employee also acknowledges that
the Corporation, by this paragraph and elsewhere, has advised him/her to consult with an attorney
of his/her choice prior to signing this Release Agreement. The Employee represents that, to the
extent he/she desires, he/she has had the opportunity to review this Release Agreement with an
attorney of his/her choice.




     7.   The Employee acknowledges that he/she has been offered the opportunity to consider the
terms of the Letter Agreement and this Release Agreement for a period of at least forty-five (45)
days, although he/she may sign it sooner should he/she desire. The Employee further shall have
seven (7) additional days from the date of signing this Release Agreement to revoke his/her consent
hereto by notifying, in writing, the Chief People Officer of the Corporation. This Release
Agreement will not become effective until seven days after the date on which the Employee has
signed it without revocation.




     8.   The Employee acknowledges that, by the attached Exhibit 1, which is incorporated herein
by reference, the Corporation has informed him/her in writing of the time limits and eligibility
requirements applicable to the separation program; the category of employees eligible for the
program; and the job title and age of each employee selected or not selected for termination as a
result of the separation program.



Dated:




	 	 	 	 	 
	 	 
 	 
	 	Employee Name:





Cott Corporation

Per: 	 
	 	 
 
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 






9










 








     EXHIBIT 1



     The Corporation is undergoing a group termination program as a result of a restructuring of
the Cott Management Committee Group “CMC Group.”. The Letter Agreement and Release Agreement,
which together provide for additional severance benefits, will be offered to executives in the CMC
Group whose employment is terminated as a result of the restructuring. All CMC Group executives
who are being offered severance pay and other consideration must sign the Release Agreement and
return it to the General Counsel of the Corporation within forty-five (45) days after receiving
the Release Agreement. Once the Release Agreement is signed, the employee has seven (7) days to
revoke the Agreement.



     The following is a list of the job titles and ages of all employees within the CMC Group to
whom the Corporation is offering the Severance Program



	 	 	 
	Job Title
	 	Age
	 
	President North America
	 	46
	 
	Chief Legal and Corporate Development Officer
	 	49
	 
	VP Communications
	 	41






     The following is a listing of the ages and job titles of employees in the CMC Group
who were not selected for layoff and offered this Severance Package:



	 	 	 
	Job Title
	 	Age
	 
	Chief People Officer
	 	46
	 
	Chief Supply and Manufacturing Officer
	 	50
	 
	Chief Information and Shared Services Officer
	 	49
	 
	Chief Financial Officer
	 	51
	 
	President International
	 	49