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EXHIBIT 10.2
EXECUTIVE EMPLOYMENT AGREEMENT
THIS
AGREEMENT made with effect as of the 28th day of September,
2005
BETWEEN:
COTT CORPORATION
(the "CORPORATION")
-and-
MARK BENADIBA
(the "EXECUTIVE")
WHEREAS the Corporation currently employs the Executive and the
Executive
wishes to continue to be employed by the Corporation.
AND
WHEREAS the Corporation and the Executive are parties to an amended
and
restated employment agreement dated October 15, 2003 and
counter-signed by the
Executive on October 23, 2003 (the "2003 Employment
Agreement").
AND
WHEREAS the Corporation and the Executive wish to terminate the
2003
Employment Agreement as of the Effective Date (as defined below),
and have
negotiated terms and conditions for a fixed-term period of
employment.
AND
WHEREAS the Corporation and the Executive have agreed to formalize
the
terms and conditions agreed between them which will, as of the
Effective Date,
govern the Executive's employment with the Corporation, all as set
out in this
Agreement, and which will amend, supersede and replace any previous
employment
agreement between the Corporation and the Executive (including,
without
limitation, the 2003 Employment Agreement).
NOW
THEREFORE in consideration of the mutual covenants and promises
set
forth herein and for other good and valuable consideration, the
receipt and
sufficiency of which are hereby acknowledged by each of the
Corporation and the
Executive, the parties hereby covenant and agree as follows:
ARTICLE I - DEFINITIONS AND INTERPRETATION
1.1 Definitions. For the purposes of this Agreement, the following
words and
phrases shall have the following meanings:
(a)
"AFFILIATE" has the
same meaning as given to such word in the
Securities Act (Ontario), as amended or replaced from time to
time.
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(b)
"AGREEMENT" means this
agreement, including any schedules hereto, as
amended, supplemented, or modified in writing from time to
time.
(c)
"BENEFITS" means those
benefits and perquisites as described in
Section 5.2 and in which the Executive is participating as at the
Date
of Termination
but, for greater certainty, excludes any share option,
share purchase, equity, profit-sharing, bonus, or other
incentive
plans or entitlements.
(d)
"BOARD" means the
Board of Directors of the Corporation.
(e)
"BUSINESS" means the
business of manufacturing, selling, or
distributing non-alcoholic beverages or any other line of
business
actively carried on by the Corporation or in the Corporation's
active
contemplation to the knowledge of the Executive as at the Date
of
Termination, including, without limitation, the business carried on
by
any Affiliate.
(f)
"COMPENSATION" shall
mean the aggregate of the Executive's annual base
salary and annual automobile allowance as at the Date of
Termination,
plus the Executive's target annual incentive bonus (such annual
incentive bonus being capped at 100%) but, for greater
certainty,
excludes any retention or extraordinary bonuses, share option,
share
purchase, equity, profit-sharing, or long-term incentive plans,
awards
or entitlements.
(g)
"CONFIDENTIAL
INFORMATION" means information disclosed or accessible
to the Executive or acquired by the Executive as a result of
his
employment with the Corporation and which is not in the public
domain
or otherwise required to be publicly disclosed by applicable law
and
includes, but is not limited to, information relating to the
Corporation's or any of its Affiliates' current, future or
proposed
products/services or development of new or improved
products/services,
marketing strategies, sales or business plans, the names and
information about the Corporation's past, present and
prospective
customers and clients, technical data, records, reports,
presentation
materials, interpretations, forecasts, test results, formulae,
projects, research data, personnel data, budgets, unpublished
financial statements, Innovations, and any other information
received
by the Corporation from third parties pursuant to an obligation
of
confidentiality.
(h)
"DATE OF TERMINATION"
means the date of cessation of the Executive's
employment without regard to any notice of termination, pay in lieu
of
notice of termination, severance or other damages and, for
greater
certainty, shall mean the earliest of the following dates:
(i) the expiry of the
Term;
(ii) the date of the Executive's death; or
(iii) the date set out in any written notice of
termination/resignation delivered by the Corporation or the
Executive to the other party.
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(i)
"EFFECTIVE DATE" means
the effective date of this Agreement as set
forth above, that is, September 28, 2005.
(j)
"INNOVATIONS" means
any:
(i) processes,
machines and compositions of matter;
(ii) inventions and improvements (whether or not protectable
under
patent laws);
(iii) techniques, ideas, concepts and programs;
(iv) works of authorship and information fixed in any tangible
medium,
including source code for software, (whether or not protectable
under copyright laws) and all moral rights therein;
(v) mask works or
integrated circuit topography;
(vi) trademarks,
trade names, trade dress and trade secrets and
know-how (whether or not protectable under trade secret laws);
(vii) other subject matter protectable under patent, copyright,
mask
work, trademark, trade secret or other similar laws; or
(viii) any derivative works, improvements, renewals,
extensions,
continuations, divisionals, continuations in part, or
continuing
patent applications relating to any Innovation.
(k)
"JUST CAUSE"
means:
(i) the wilful and
continued failure by the Executive substantially
to perform his duties with the Corporation (other than a
failure
resulting from his incapacity due to physical or mental
illness)
after a written demand for substantial performances delivered
to
the Executive by the Board, which demand specifically
identifies
the manner in which the Board believes that the Executive has
not
substantially performed his duties, and the Executive has
failed
to correct such failure to perform his duties within thirty
(30)
days after such written demand is delivered to him; or
(ii) the wilful engaging by the Executive in conduct that is
demonstrably and materially injurious to the Corporation,
monetarily or otherwise, provided that no act or failure to act
on the Executive's part shall be deemed "wilful" unless done,
or
omitted to be done, by the Executive not in good faith and
without reasonable belief that his action or omission was in
the
best interests of the Corporation
(l)
"SEVERANCE PERIOD"
shall mean the period commencing on the Date of
Termination and ending twenty-four (24) months thereafter.
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(m)
"TERRITORY" means:
(i) Canada;
(ii) every state or possession of the United States of America;
and
(iii) every country in which the Corporation or any of its
Affiliates
maintain an office and actively carry on the Business
ARTICLE II - TERM
2.1 Fixed Term. This Agreement shall commence on the Effective Date
and this
Agreement and the Executive's employment shall be for a maximum
fixed term of
three (3) years ending on September 27, 2008 (the "Term"), subject
to earlier
termination of the Executive's employment in accordance with
Article VI below.
At the end of the Term, this Agreement and the Executive's
employment are wholly
and automatically at an end without notice or further obligation by
the
Corporation to the Executive other than amounts or benefits earned
and accrued
by the Executive and payable by the Corporation up to such expiry
date. The
parties each acknowledge that there is no representation, warranty,
covenant or
commitment to renew or extend the Term or the Executive's
employment beyond the
expiry of the Term.
2.2 Consultancy: Notwithstanding Section 2.1 above, at the end of
the Term and
effective as of the day following up the expiry of the Term, the
Corporation and
the Executive shall enter into a consultancy agreement
substantially including
the terms and conditions and in the form attached as Schedule "A"
to this
Agreement.
ARTICLE III - EMPLOYMENT AND POSITION
3.1 Position. Subject to the terms and conditions set out in this
Agreement, the
Corporation hereby agrees to employ the Executive, and the
Executive hereby
agrees to serve the Corporation, in the position of Executive Vice
President, or
such other position as may be assigned to the Executive by the
Corporation's
President and Chief Executive Officer or the Board but provided
that such
position is of at least equivalent stature and level of
responsibilities within
the Corporation.
3.2 Executive's Covenant. The Executive represents and warrants to
the
Corporation that he is free to enter this Agreement and that he is
not subject
to any obligation or restriction (statutory, contractual, or at
common law)
which would prevent or interfere with the performance of all of his
obligations
hereunder.
3.3 Place of Employment. The Executive shall provide his duties and
services to
the Corporation at its office in Toronto, Ontario, or at such other
place or
places within the greater Toronto area as the Corporation may
determine from
time-to-time. The Executive's place, of employment will not be
moved outside of
the greater Toronto area without his consent. The Executive
acknowledges that,
in the ordinary course of business and in carrying out his duties
for the
Corporation, he will have customary business travel
obligations.
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ARTICLE IV - DUTIES
4.1 Full-Time. The Executive's position with Corporation is a
full-time one.
Therefore, throughout the duration of his employment, the Executive
shall devote
his full working time and attention to the business and affairs of
the
Corporation, acting in the best interests of the Corporation at all
times. The
Executive shall not, during his employment with the Corporation,
accept nor hold
any position as an officer, director, employee, consultant, or any
like position
for or on behalf of any entity without the prior written approval
of the
Corporation, which approval may be withheld in its sole
discretion.
4.2 Duties; Reporting. Reporting to and subject to the general
direction of the
Corporation's President and Chief Executive Officer or as may
otherwise be
designated by the Board (but provided that the Executive shall
always report to
the most senior management executive officer of the Corporation),
the Executive
shall perform such other duties and responsibilities consistent
with such
position as may be assigned to him by the Corporation's President
and Chief
Executive Officer or the Board from time-to-time. The Executive
shall perform
all duties in accordance with the charter documents and by-laws of
the
Corporation, the instructions of the Corporation's President and
Chief Executive
Officer and the Board, and all of the Corporation's policies and
codes of
conduct, rules and regulations in effect from time to time. In
addition to the
duties and responsibilities associated with his position, the
Executive shall
perform such other duties and responsibilities consistent with the
position as
may be assigned to him by the Corporation's President and Chief
Executive
Officer or the Board from time to time. The Corporation's President
and Chief
Executive Officer or the Board retain full authority to change the
Executive's
duties and responsibilities and reporting relationships (but
provided that the
Executive shall always report to the most senior management
executive officer of
the Corporation) and to assign new duties and responsibilities
provided that
such changes do not result in a diminution of the scope or dignity
of the
Executive's overall duties and responsibilities.
4.3 Compliance. Recognizing the Corporation's commitment to
achieving the
highest standards of openness and accountability, the Executive
shall raise, in
a prompt manner, any good faith concerns he has regarding the
conduct of the
Corporation's business or compliance with the Corporation's
financial, legal or
reporting obligations. Such good faith concerns should be brought
first to the
attention of the Corporation's President and Chief Executive
Officer or to the
Board.
ARTICLE V - COMPENSATION AND BENEFITS
5.1 Signing Bonus. As an inducement to the Executive to sign this
Agreement and
in full and final satisfaction of all of the Executive's payments,
benefits,
rights and entitlements due or payable under the 2003 Employment
Agreement, the
Corporation shall pay to the Executive a signing bonus of
$1,000,000.00, such
payment to be made on a lump sum basis within ten (10) business
days of the
execution of this Agreement by the Executive.
5.2 Base Salary. During his employment, the Corporation shall pay
the Executive
a base salary of $500,000.00 annually, paid in such instalments and
at such
times and in the same manner as the Corporation pays its other
senior executives
generally, but not less than monthly. The Executive's base salary
will be
reviewed annually by the Human Resources and
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Compensation Committee (or as may otherwise be delegated by the
Board) for
consideration of an increase, if appropriate, in its
discretion.
5.3 Benefits. During his employment, the Executive shall be
eligible to
participate in all benefits and all perquisites (including
medical,
prescription, dental, disability, life, AD&D and travel
insurance), provided by
the Corporation on the same basis as similarly situated senior
executives of the
Corporation employed in Canada, but excluding the Corporation's
President and
Chief Executive Officer, as such plans and policies may be amended
from
time-to-time. The Executive acknowledges and agrees that the
benefits and
perquisites made available to him (including group insurance) are
subject to
change in the Corporation's sole discretion, and further, any
entitlement of the
Executive is subject to and shall be governed by the terms and
conditions of any
written policies, plans, programs or contracts.
5.4 Automobile. During his employment, the Corporation shall pay to
the
Executive an annual automobile allowance in accordance with the
Corporation's
policy as it may be amended from time-to-time.
5.5 Vacation. For each year of employment during the Term, the
Executive shall
accrue vacation in accordance with the Corporation's vacation
policy for
management, currently five (5) weeks' paid vacation per calendar
year, such
vacation to extend for such periods and to be taken at such
intervals as shall
be appropriate and consistent with the proper performance of the
Executive's
duties and as agreed upon between the Executive and the
Corporation. To the
extent permitted by applicable law, accumulated vacation time or
pay may not be
carried forward except with the prior approval of the Board.
5.6 Annual Bonus Incentive. For each year of employment during the
Term, the
Executive shall be eligible for an annual bonus incentive with a
target bonus
award of $575,000.00 (at 100%), and a potential maximum award based
on exceeding
achievements of $1,150,000.00 (at 200%). The Executive's annual
bonus incentive
shall include the following components, terms and conditions:
(a)
Objectives (including
all performance thresholds, targets and maximum
goals) will be set annually by the Human Resources and
Compensation
Committee (or as may otherwise be delegated by the Board).
(b)
The level of
achievement of all objectives will be evaluated by the
Human Resources and Compensation Committee (or as may otherwise
be
delegated by the Board) as soon as possible following each
fiscal
year.
(c)
Subject to Sections
6.3 and 6.4 below, bonuses, if any, shall be
earned only upon completion of the relevant fiscal year of the
Corporation and shall be payable after completion of the
Corporation's
audited financial statements for such fiscal year.
5.7 Reimbursement of Expenses. Upon presentation of proper receipts
or other
proof of expenditure and subject to such reasonable guidelines or
limitations
provided by the Corporation from time to time, the Corporation
shall reimburse
the Executive for all reasonable and necessary expenses actually
incurred by the
Executive directly in connection with the business affairs of the
Corporation
and the performance of his duties hereunder. The Executive shall
comply with
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such reasonable limitations and reporting requirements with respect
to such
expenses as the Board may establish from time to time.
5.8 Continuation of Benefits. All benefits, stock options and
annual bonus
incentives to which the Executive was entitled immediately prior to
the
execution of this Agreement shall, unless otherwise replaced or set
out in this
Agreement, continue without loss or change as of the Effective
Date. For greater
certainty, all grants of stock options to the Executive shall be
governed by the
applicable plans and policies, specifically including and without
limitation,
the Restated 1986 Common Share Option Plan of the Corporation, as
they may be
amended from time-to-time.
5.9 No Other Entitlements. The Executive is not entitled to any
other payment,
benefit, perquisite, allowance or entitlement other than as
specifically set out
in this Agreement or as otherwise agreed to in writing and signed
by the
Corporation and the Executive.
ARTICLE VI - TERMINATION OF EMPLOYMENT
6.1 Early Termination. Notwithstanding any other provision in this
Agreement,
the Executive's employment may be terminated at any time as
follows:
(a)
Death. This Agreement
and the Executive's employment shall
automatically terminate upon the death of the Executive.
(b)
Just Cause. The
Corporation may terminate this Agreement and the
Executive's employment at any time forthwith for any Just
Cause.
(c)
Without Just Cause.
The Corporation may terminate this Agreement and
the Executive's employment at any time without Just Cause and for
any
reason or no reason whatsoever by providing written notice to
the
Executive specifying the effective Date of Termination (which may
be
forthwith).
(d)
Resignation. The
Executive may terminate this Agreement and his
employment at any time by providing written notice to the Board
specifying the effective date of termination (such date being not
less
than three (3) months and not more than six (6) months after the
date
of the Executive's written notice). The Corporation may elect to
deem
any date prior to the date specified in the notice as the Date
of
Termination.
6.2 Termination for Just Cause or Resignation. If this Agreement
and the
Executive's employment is terminated pursuant to subsections 6.1(b)
or 6.1(d)
above, then the Corporation shall pay to the Executive an amount
equal to the
base salary and vacation pay earned by and payable to the Executive
up to the
Date of Termination and the Executive shall have no entitlement to
any further
notice of termination, payment in lieu of notice of termination,
severance, or
any damages whatsoever. Participation in all bonus plans
(specifically including
all short and long term incentive plans) or other stock option,
equity, or
profit participation plans terminates immediately upon the Date of
Termination
and the Executive shall not be entitled to any additional bonus or
incentive
award, pro rata or otherwise, except as may have been owing to him
for the
Corporation's fiscal year immediately preceding the Date of
Termination.
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6.3 Termination by Reason of Death. If this Agreement and the
Executive's
employment is terminated pursuant to subsections 6.1(a) above, then
the
Corporation shall pay to the Executive an amount equal to the base
salary and
vacation pay earned by and payable to the Executive up to the Date
of
Termination and the Executive shall have no entitlement to any
further notice of
termination, payment in lieu of notice of termination, severance,
or any damages
whatsoever. Participation in all bonus plans (specifically
including all short
and long term incentive plans) or other stock option, equity, or
profit
participation plans terminates immediately upon the Date of
Termination, but the
Corporation shall pay to the Executive his bonus or incentive
entitlements (if
any) calculated pro rata for the period up to the Date of
Termination based on
achievement of the bonus incentive target to such date, such
payment(s) being
made immediately if the amount can be readily determined but, in
any event, no
later than thirty (30) days following the completion of the audited
financial
statements for the fiscal year in which the Date of Termination
occurs.
6.4 Termination Without Just Cause. If this Agreement and the
Executive's
employment is terminated by the Corporation without Just Cause
pursuant to
subsection 6.1(c) above, then the following provisions shall
apply:
(a)
The Corporation shall
pay to the Executive an amount equal to the base
salary, car allowance, and vacation pay earned by him and payable
to
him up to the Date of Termination.
(b)
Participation in all
bonus plans (specifically including all short and
long term incentive plans) stock option, equity, or profit
participation plans terminates immediately upon the Date of
Termination. However, the Corporation shall pay to the Executive
his
bonus (if any) calculated pro rata for the period up to the Date
of
Termination based on achievement of the annual bonus incentive
target
to such date, such payment(s) being made immediately if the amount
can
be readily determined but, in any event, not later than thirty
(30)
days following the completion of the audited financial statements
for
the fiscal year in which the Date of Termination occurs.
(c)
The Corporation shall
pay to the Executive, or as he may direct,
severance in an amount equivalent to two (2) times the
Compensation
(for greater certainty, such severance being no less than
Cdn.$2,150,000.00), payable in a lump sum within ten (10)
business
days following the Date of Termination.
(d)
To the extent that the
Corporation may do so legally and in compliance
with its plans and policies in existence from time to time, the
Corporation shall continue all Benefits for the Severance
Period,
provided that, if the Corporation cannot continue any
particular
Benefit, then the Corporation shall reimburse the Executive for
all
reasonable expenses incurred by him to replace such Benefit for
an
equivalent duration.
6.5 No Mitigation. The Executive shall not be required to mitigate
damages by
seeking other employment or otherwise, nor shall any amount
provided for under
this Agreement be reduced in any respect in the event that the
Executive shall
secure or not reasonably pursue alternative employment following
the termination
of the Executive's employment with the C
