Sincerely,JONES SODA CO.By: /s/ Mills BrownMills BrownChairman, Compensation and Governance Committee Confirmed and Agreed:/s/Jennifer L. CueJENNIFER L. CUEFinance ApprovalPFO: /s/ Carrie L. Traner8/6/2012Dated: August 6, 2012

Salary:

Your salary will be $96,000 per annum ($8,000 monthly), payable in regular installments in accordance with the Company’s normal payroll practices (subject to applicable withholdings and agreed-upon deductions).

Bonus:

Beginning with the Company’s 2013 fiscal year, you will be eligible for performance-based bonuses, in such amounts and based on such performance goals as determined by the Compensation and Governance Committee (“Committee”) (including such factors as revenue targets, achievement of annual budgets and other matters determined by the Committee).

Stock Options:

Effective on the date of this agreement, the Company will grant to you stock options for a total of 2,000,000 shares of common stock. The first stock option will be for 1,000,000 shares and will be fully vested upon grant, in recognition of your willingness to take a reduced cash salary compared to prior CEOs. The second stock option will be for an additional 1,000,000 shares, to vest over time subject to your continued employment, with 50% vesting on June 27, 2013 (the one-year anniversary of your start date) and the balance vesting on June 27, 2014 (the two-year anniversary of your start date). Your stock options will be subject to the terms and conditions of the 2011 Incentive Plan (“Plan”). The exercise price of your stock options will be equal to the fair market value of the Company’s common stock on the date of grant, as determined pursuant to the Plan. The date of grant will be the date that the stock options are approved by the Board. Your stock options will be documented by delivery to you of a stock option agreement specifying the terms and conditions of the options

Benefits:

Car Allowance:

$500.00 per month.

Cell Phone Allowance:

$150.00 per month.

401(k):

You will be eligible to participate in the Company’s 401(k) Plan after 90 days of employment.

Vacation:

4 weeks per annum

Location:

The Company acknowledges that you currently live in San Francisco and that you are not required to relocate to Seattle, Washington during the first year of employment. However, you acknowledge that you are expected to travel to and be in the Seattle office. The Company will reimburse your travel expense between San Francisco and Seattle, including reasonable car rental. Following June 2013, the Board may require you to move to Seattle as a condition to your continued employment. If you are required to move, the Company will reimburse up to $10,000 in moving and relocation expenses.

At Will Employment

Your employment with the Company will be “at will,” meaning that either you or the Company will be entitled to terminate your employment at any time and for any reason, with or without cause.

Severance:

Withholding:

The Company may withhold (or cause to be withheld) from any payment or benefit provided in this letter any taxes that are required to be withheld under any applicable law.

Section 409A:

The payments and benefits provided for in this letter are intended to be exempt from the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”) to the maximum extent possible, whether pursuant to the short-term deferral exception described in Treasury Regulation Section 1.409A-1(b)(4), the involuntary separation pay plan exception described in Treasury Regulation Section 1.409A-1(b)(9)(iii), or otherwise. To the extent Section 409A is applicable to such payments and benefits, the parties intend that this letter (and such payments and benefits) shall comply with the deferral, payout and other limitations and restrictions imposed under Section 409A and the regulations, rulings and other guidance issued thereunder. Notwithstanding any other provision of this letter to the contrary, this letter shall be interpreted, operated and administered in a manner consistent with such intentions. Without limiting the generality of the foregoing, and notwithstanding any other provision of this letter to the contrary, with respect to any payments and benefits under this letter to which Section 409A applies, all references in this letter to termination of your employment are intended to mean your “separation from service,” within the meaning of Section 409A(a)(2)(A)(i). In addition, if you are treated as a “specified employee,” within the meaning of Section 409A(a) (2)(B)(i), then to the extent necessary to avoid subjecting you to the imposition of any additional tax under Section 409A, amounts that would otherwise be payable under this letter during the six-month period immediately following your separation from service shall not be paid to you during such period, but shall instead be accumulated and paid to you (or, in the event of your death, to your estate) in a lump sum on the first business day following the earlier of (a) the date that is six months after your separation from service or (b) your death.