EXHIBIT 10.17
AMENDMENT TO SUPPLY AGREEMENT BETWEEN CROWN CORK & SEAL
USA, INC. AND COTT CORPORATION
***Indicates that a portion of the exhibit has been omitted based on a request
for confidential treatment submitted to the Securities and Exchange Commission.
The omitted portions have been filed separately with the Commission.
December 23, 2004
COTT CORPORATION -- BEVERAGE CAN CONTRACT EXTENSION
Crown Cork & Seal USA, Inc. ("Crown"), is pleased to present to Cott Corporation
("Cott"), for consideration and approval, the following extension and
modification of the current can and end "Supply Agreement" executed November 11,
2003. In exchange for [***] agreement with the provisions of this extension and
modification, [***] agrees to [***] execution and delivery of this extension and
modification, whichever is later.
1. STRUCTURE - Extend current "Supply Agreement" with modifications outlined
below.
2. TERM - Add five (5) years to term - Jan. 1, 2007 through Dec. 31, 2011.
3. COMMITMENT - Subject to Section 4 below, 100 % global supply by Crown of
all Cott can & end requirements 355 ml & smaller - unless mutual agreement
otherwise. (All 8 oz. cans in North America will be supplied by Crown to
Cott under a separate contract dated June 18, 2004 for the period Jan. 1,
2005 through Dec. 31, 2009.)
4. Expansion - Effective January 1, 2005, in the event that Cott requires
cans and ends to be supplied into any country not supplied to Cott by
Crown on the date of this extension, Crown shall [***]
5. [***] UK AND SPAIN- Beginning January 1, 2007, by mutual agreement, the
parties will bring [***] UK and Spain [***]:
[***] [***]
[***] [***]
[***] [***]
[***] [***]
[***] [***]
[***] Cott shall make the payment within thirty (30) days after the
parties' determination of the amount to be paid.
6. ALUMINUM COSTS - Follow the aluminum program in the current contract
through [***] Beginning [***], price adjustments for ingot and aluminum
sheet conversion costs shall reflect the terms then available to Crown
through new contracts (yet to be negotiated) with its aluminum suppliers;
[***]
7. [***] PROGRAM - USA AND CANADA [***] - Continue current program - [***]
cans per year in USA and Canada in the aggregate (refer to side agreement
dated June 18, 2004). The [***] Program shall be extended for an
additional [***]. In no situation will Cott's [***], as a result of the
[***] Program, [***]
8. PRICE ADJUSTMENTS -- Continue current price adjustment provisions for
[***] changes through [***] as provided by the Supply Agreement.
Beginning [***], price adjustments for ingot and aluminum sheet conversion
costs shall reflect the provisions in Crown's future aluminum can/end
metal sourcing agreements (yet to be negotiated). The timing of price
adjustments for ingot and sheet conversion costs will depend on the new
metal sourcing agreements.
Beginning [***], North American, UK and Spain price adjustments (increases
or decreases) for [***] changes shall be implemented on [***] of each
contract year to reflect the following:
a) [***]
b) [***]
c) [***]
d) [***]
Price adjustments in UK and Spain beginning [***] shall be subject also to
the [***] mechanism provided in Section 5 above.
For each country outside North America, UK and Spain, beginning [***], the
parties will [***].
9. [***]
10. [***]
11. [***] -- Current sharing ratio is [***] Cott - [***] Crown [***].
Beginning January 1, 2005, the sharing ratio shall be changed to [***]
Cott - [***] Crown after [***]. This [***] sharing ratio shall not apply
to the [***] for any [***]. In the event that any [***] occur on or after
January 1, 2005, each party [***].
12. [***] - In the current agreement, [***]
This provision will be in effect only until January 1, 2005 and will not
apply thereafter.
13. FORCE MAJEURE - In the current agreement, Force majeure events are not
considered an excuse for Crown to miss shipments to Cott unless such event
shuts down at least [***] of Crown's manufacturing capability in that
region (USA and Canada is one region). Crown is obligated to reimburse
Cott for "all reasonable direct out-of-pocket losses, costs, damages, and
expenses" incurred by Cott due to Crown's failure to supply.
Beginning January 1, 2005, this provision will be changed to [***]. If a
force majeure event occurs, [***].
14. WHITE BASECOAT [***] -- Beginning July 1, 2005, the [***] for white
basecoated designs shall be [***] for both current and new designs. [***]
15. FREIGHT COSTS -- In order to minimize freight costs, beginning April 1,
2005, all shipments of can bodies to Cott filling locations and [***]
locations will be [***] pallets per load depending on trailer size, where
possible.
16. GRAPHICS -- Beginning January 1, 2006, Cott will be required to pay to
Crown a charge of [***] for the use of Crown's [***] equipment for the
purpose of [***] new [***]
(Signature page follows.)
If you are in agreement with the terms of this extension and modification of the
current Supply Contract as detailed above, please indicate your acceptance by
signing in the space provided below.
Very truly yours,
By: /s/ Frank J. Mechura
-----------------------------
Title: President
CROWN Cork & Seal USA, Inc.
Agreed and Accepted this ______ day of ___________ , 2004:
By: /s/ John K. Sheppard
-----------------------------
Title: President and CEO
By: /s/ Raymond P. Silcock
-----------------------------
Title: EVP & CFO
Cott Corporation
June 18, 2004
[***] PROGRAM
Cott Corporation
333 rue Avro
Pointe-Claire,
Quebec Canada H9R 5W3
CROWN Cork and Seal USA, Inc. ("Crown") is pleased to offer to Cott Corporation
("Cott") the following [***] Program (the "Program") covering [***] pursuant to
the Supply Agreement between Crown's parent (which contract has been assigned to
Crown) and Cott effective January 1, 2002 (the "Supply Agreement"), which
remains in full force and effect, unamended, except to the extent set forth in
this Agreement.
PROGRAM TERM
The term of the Program shall extend for [***]
BASE [***]
The base [***] for the Program shall be [***] This represents the [***]
[***]
In addition to any other [***] contained in the Supply Agreement, each year
during the term of the Program, [***]. For clarity, but without limiting the
generality of the foregoing, any [***] acquired locations or for [***] brands
where Crown is [***].
[***]
[***]
[***]
[***]
[***]
[***]
- [***]
- [***]
- [***]
- [***]
If you are in agreement with the provisions of this Program as set forth above,
please sign in the space provided below and return one original signed copy to
Crown.
CROWN CORK & SEAL USA, INC.
By: /s/ Tom Fischer
Name: Thomas T. Fischer
Title: Vice President Sales and Marketing
CROWN Beverage Packaging USA
AGREED AND ACCEPTED this
7 day of July, 2004:
COTT CORPORATION
By: /s/ I. Grimaldi
---------------
Name: Ivan Grimaldi
Title: V.P. Global Procurement
By: /s/ T. Dell'Aquila
------------------
Name: Tina Dell'Aquila
Title: VP, Controller & Assistant Secretary
CROWN Beverage Packaging USA [CROWN LOGO]
December 16, 2004
Mr. John Sheppard
President
Cott Corporation
333 Avro Avenue Quebec
Canada H9R 5W3
Subject: PRICING METHODOLOGY AMENDMENT
Dear Mr. Sheppard,
Please refer to the Supply Agreement for aluminum cans and ends between Cott
Corporation ("Cott") and Crown Cork & Seal Company, Inc. ("CCS") executed
November 11, 2003 (and since assigned by CCS to Crown Cork & Seal USA, Inc.
("Crown"), which is scheduled to expire on December 31, 2006 (as amended, the
"Supply Agreement).
Cott and Crown have agreed that Sections I(c), (e) and (f) of Schedule 3(a) of
the Supply Agreement shall be amended to read in their entirety as follows:
c) Ceiling Price - The adjustments for the [***] will be [***] based upon a
[***] based on [***].
e) This program shall be in effect for the period from [***] through at least
[***]. Supplier agrees that any Price changes made under this Agreement
based on Supplier's [***] shall reflect [***]. Such changes in [***] will
be subject to confirmation by Supplier's independent auditor (currently
PricewaterhouseCoopers). Buyer's [***] will [***].
f) [***] Costs
Prices will be changed to reflect verifiable changes in the [***]
component of the price Supplier pays to [***] Such changes in [***] will
be subject to confirmation by Supplier's independent auditor (currently
PricewaterhouseCoopers).
Please sign below to evidence your agreement with the terms of this letter.
Except as specifically set forth in this letter, the terms of the Supply
Agreement remain in full force.
Sincerely,
/s/ Tom Fischer
Thomas T. Fischer
Vice President Sales and Marketing
CROWN Beverage Packaging USA
Accepted and agreed this 23rd day of December, 2004:
COTT CORPORATION
By: /s/ John K. Sheppard
--------------------
Name: John K. Sheppard
Title: President and CEO
By: /s/ Raymond P. Silcock
----------------------
Name: Raymond P. Silcock
Title: Executive Vice President & Chief Financial Officer