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Master Settlement Agreement Amendments

AMENDMENT TO THE MASTER SETTLEMENT AGREEMENT

AMENDMENT NO 2 TO MASTER SETTLEMENT AGREEMENT

AMENDMENT NO 3 TO MASTER SETTLEMENT AGREEMENT

AMENDMENT NO 4 TO MASTER SETTLEMENT AGREEMENT

AMENDMENT NO 5 TO MASTER SETTLEMENT AGREEMENT

AMENDMENT NO 6 TO MASTER SETTLEMENT AGREEMENT

AMENDMENT NO 7 TO MASTER SETTLEMENT AGREEMENT

AMENDMENT NO 8 TO MASTER SETTLEMENT AGREEMENT

AMENDMENT NO 9 TO MASTER SETTLEMENT AGREEMENT

AMENDMENT NO 10 TO MASTER SETTLEMENT AGREEMENT

AMENDMENT NO 11 TO MASTER SETTLEMENT AGREEMENT

AMENDMENT NO 12 TO MASTER SETTLEMENT AGREEMENT

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AMENDMENT TO THE MASTER SETTLEMENT AGREEMENT

Pursuant to Section XVIII(J) of the Master Settlement Agreement, the undersigned parties hereby agree that Section IX(i)(4)(A) of the Master Settlement Agreement is amended to read as follows:

"(A) became a signatory to this Agreement more than 90 days after the MSA Execution Date or"

 

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ADDENDUM TO THE

MASTER SETTLEMENT AGREEMENT

The undersigned Settling States and Participating Manufacturers hereby agree as follows:

1. A. Liggett Group Inc.

   B. Commonwealth Brands, Inc.

   C. Sante Fe Natural Tobacco Company, Inc.

   D. Crossline Distributors, Ltd.

   E. ITL (USA) Limited

   F. Japan Tobacco International U.S.A., Inc.

   G. King Maker Marketing, Inc.

   H. Lane Limited

   I. Lignum-2, Inc.

   J. LTD Corporation

   K. The Medallion Company, Inc.

   L. Point Marketing Inc.

   M. Port-O-Van

   N. Premier Marketing Incorporated

   O. P.T. Djarum

   P. Sherman’s 1400 Broadway N.Y.C. Ltd. [end page 1]*

   Q. Societe Nationale d’Exploitation Industrielle des Tobacs et Allumettes

   R. Tobacco Exporters International (USA) Ltd.

   S. Top Tobacco, L.P.

2. The MSA is hereby amended as set forth in the attached Amendments No. 2 through and including No. 15 11.
3. Revision of the MSA pursuant to subsection XVIII(b)(2) shall not be required by virtue of any of the amendments set forth herein.
4. All capitalized terms used in this Addendum and attached Amendments not otherwise defined have the meaning given such terms in the MSA.

IN WITNESS WHEREOF, each Settling State and each Participating Manufacturer, through their

fully authorized representatives, have agreed to this Addendum and Amendments.

 

PHILIP MORRIS INCORPORATED

By: /s/ Martin J. Barrington
Date: February 19, 1999

R. J. REYNOLDS TOBACCO COMPANY

By: /s/ Charles A. Blixt
Date: 2-15-99

BROWN & WILLIAMSON TOBACCO CORPORATION

By: /s/ F. A. Burke
Date: 2/17/1999

LORILLARD TOBACCO COMPANY

By: /s/ Ronald S. Milstein
Vice President, General Counsel
Date: 2/17/99

 

LIGGETT GROUP INC.

consenting only to Amendments 2, 3, 9 and 10 to the MSA.
By: /s/ Bennett S. LeBow_______
/by permission to Aaron H. Marks
Date: 2/21/99

COMMONWEALTH BRANDS, INC.

By: /s/ William Jay Hunter
Date: February 18, 1999

SANTA
SANTE FE NATURAL TOBACCO COMPANY, INC.

By: /s/ Bradford C. Berge
Date: February 15, 1999

CROSSLINE DISTRIBUTORS, LTD.

By: [no signature]
Date:

ITL (USA) LIMITED

By: /s/ Bill Rose
Date: Feb 15/99

JAPAN TOBACCO INTERNATIONAL U.S.A., INC.

By: /s/ Masayuki Hamada
Masayuki Hamada, President
Date: 2/16/99

KING MAKER MARKETING, INC.

By: /s/ Mark Finkle
Date: 2/12/99

LANE LIMITED

By: /s/ Robert S. Pless
Date: February 15, 1999

LIGNUM-2, INC.

By: /s/ Ken Irinaga
Date: 2/16/99

LTD CORPORATION

By: /s/ Bill Wills
Date: 2/12/99

THE MEDALLION COMPANY, INC.

By: /s/ Wayne Rice
Date: 2-15-99

POINT MARKETING INC.

By: [no signature]
Date:

PORT-O-VAN, INC.

By: [no signature]
Date:

PREMIER MARKETING INCORPORATED

By: /s/ Mark Dunham
Date: 2/15/99

P.T. DJARUM

By: /s/ Honley Harjo, Director
Date: February 15, 1999

SOCIETE NATIONALE d’EXPLOITATION INDUSTRIELLE
des TOBACS et ALLUMETTES

By: /s/ Jean Dominique Comolli
Date: February 17, 1999

SHERMAN’S 1400 BROADWAY N.Y.C., LTD.

By: /s/ Joel Sherman, Pres.
Date: 2/12/99

TOBACCO EXPORTERS INTERNATIONAL (USA) LTD.

By: /s/ Robert S. Pless
Date: February 15, 1999

TOP TOBACCO, L.P.

By: /s/ Seth I. Gold
Seth I. Gold, Executive Vice-President
Date: February 12, 1999

 

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AMENDMENT NO 2 TO MASTER SETTLEMENT AGREEMENT

Section XVIII(b)(2) of the Master Settlement Agreement is herby amended by deleting the sentence beginning with the word "The" on the second to last line of page 128 and ending with the word "Products" on the ninth line of page 129 (see attached).

Manufacturer in a manner other than as expressly provided for in this Agreement; or

(B) on or after October 1, 1998, on non-economic terms more favorable to such governmental plaintiff than the non-economic terms of this Agreement, and such Future Settlement Agreement includes terms that provide for the implementation of non-economic tobacco-related public health measures different from those contained in this Agreement, then this Agreement shall be revised with respect to such Participating Manufacturer to include terms comparable to such non-economic terms, unless a majority of the Settling States elects against such revision.

(2) If any Settling State resolves by settlement Claims against any Non-Participating Manufacturer after the MSA Execution Date comparable to any Released Claim, and such resolution includes overall terms that are more favorable to such Non-Participating Manufacturer than the terms of this Agreement (including, without limitation, any terms that relate to the marketing or distribution of Tobacco Products and any term that provides for a lower settlement cost on a per pack sold basis), then the overall terms of this Agreement will be revised so that the Original Participating Manufacturers will obtain, with respect to that Settling State, overall terms at least as relatively favorable (taking into account, among other things, all payments previously made by the Original Participating Manufacturers and the timing of any payments) as those obtained by such Non-Participating Manufacturer pursuant to such resolution of Claims. [ The foregoing shall include but not be limited: (a) to the treatment by any Settling State of a Future Affiliate, as that term is defined in agreements between any of the Settling States and Brooke Group Ltd., Liggett & Myers Inc. and/or Liggett Group, Inc. ("Liggett"), whether or not such Future Affiliate is merged with, or its operations combined with, Liggett or any Affiliate thereof; and (b) to any application of the terms of any such agreement (including any terms subsequently negotiated pursuant to any such agreement) to a brand of Cigarettes (or tobacco-related assets) as a result of the purchase by or sale to Liggett of such brand or assets or as a result of any combination of ownership among Liggett and any entity that manufactures Tobacco Products.] Provided, however, that revision of this Agreement pursuant to this subsection (2) shall not be required by virtue of the subsequent entry into this Agreement by a Tobacco Product Manufacturer that has not become a Participating Manufacturer as of the MSA Execution Date. Notwithstanding the provisions of subsect ion XVIII(j), the provisions of this subsection

XVIII(b)(2) may be waived by (and only by) unanimous agreement of the Original Participating Manufacturers.

(3) The parties agree that if any term of this Agreement is revised pursuant to subsection (b)(l) or (b)(2) above and the substance of such term before it was revised was also a term of the Consent Decree, each affected Settling State and each affected Participating Manufacturer shall jointly move the Court to amend the Consent Decree to conform the terms of the Consent Decree to the revised terms of the Agreement.

(4) If at any time any Settling State agrees to relieve, in any respect, any Participating Manufacturer’s obligation to make the payments as provided in this

 

AMENDMENT NO 3 TO MASTER SETTLEMENT AGREEMENT

Section XII(a)(4)(A) of the Master Settlement Agreement is hereby amended by deleting the parenthetical phrase beginning on the 16th line of page 111 and ending on the 19th line of page 111 stating: "(and such Released Party gives notice to the applicable Settling State within 30 days of the service of such claim-over (or within 30 days after the MSA Execution Date, whichever is later) and prior to entry into any settlement of such claim-over)" and adding in place of such parenthetical phrase the following parenthetical phrase: "(and such Released Party gives notice to the applicable Settling State at the end of the calendar quarter (the quarterly periods to end on February 20, May 20, August 20, and November 20 of each year) in which service of such claim-over is received (or within 30 days after the MSA Execution Date, whichever is later) and prior to entry into any settlement of such claim-over; provided, however, that service of any claims received within 15 days before the end of any quarterly period shall be deemed to have been received during the subsequent calendar quarter)"

Section XII(a)(4)(B) of the Master Settlement Agreement is hereby amended by deleting the parenthetical phrase beginning after the word "settlement" on the 10th line of page 112 and ending on the 14th line of page 112 before the work "judgment" stating: "(to the extent that such Released Party has given notice to the applicable Settling State within 30 days of the service of such claim-over (or within 30 days after the MSA Execution Date, whichever is later) and prior to entry into any settlement of such claim-over)," and adding in place of such parenthetical phrase the following parenthetical phrase: "(to the extent that such Released Party has given notice to the applicable Settling State at the end of the calendar quarter in which service of such claim-over is received (or within 30 days after the MSA Execution Date, whichever is later), the end of the quarterly periods and the date on which service is deemed to have been received being those set forth in section XII(a)(4)(A) (as amended by this amendment), and prior to entry into any settlement of such claim-over),"

Section XII(a)(8)(A) of the Master Settlement Agreement is hereby amended by deleting the parenthetical phrase beginning on the 19th line of page 114 and ending on the 22nd line of page 114 stating: "(and such Released Party gives notice to the applicable Settling State within 30 days of service of such claim-over (or within 30 days after the MSA Execution Date, whichever is later) and prior to entry into any settlement of such claim-over)" and adding in place of such parenthetical phrase the following parenthetical phrase: "(and such Released Party gives notice to the applicable Settling State at the end of the calendar quarter (the quarterly periods to end on February 20, May 20, August 20, and November 20 of each year) in which service of such claim-over is received (or within 30 days after the MSA Execution Date, whichever is later) and prior to entry into any settlement of such claim-over; provided, however, that service of any claims received within 15 days before the end of any quarterly period shall be deemed to have been received during the subsequent calendar quarter)"

Section XII(a)(8)(B) of the Master Settlement Agreement is hereby amended by deleting the parenthetical phrase beginning after the word "settlement" on the 15th line of page 115 and ending on the 18th line of page 115 stating: "(to the extent that such Released Party has given notice to the applicable Settling State within 30 days of the service of such claim-over (or within 30 days after the MSA Execution Date, whichever is later) and prior to entry into any settlement of such claim-over)" and adding in place of such parenthetical phrase the following parenthetical phrase: "(to the extent that such Released Party has given notice to the applicable Settling State at the end of the calendar quarter in which service of such claim-over is received (or within 30 days after the MSA Execution Date, whichever is later), the end of the quarterly periods and the date on which service is deemed to have been received being those set forth in section XII(a)(8)(A) (as amended by this amendment), and prior to entry into any settlement of such claim-over)"

Section XII(b) of the Master Settlement Agreement is hereby amended by deleting the first sentence of that section beginning with the word "If" on the 16th line of page 117 and ending with the word "State" on the last line of page 117 and adding in place of such sentence the following sentence: "If a Releasing Party (or any person or entity enumerated in section II(pp), without regard to the power of the Attorney General to release claims of such person or entity) nonetheless attempts to maintain a Released Claim against a Released Party, such Released Party shall give written notice of such potential claim to the Attorney General of the applicable Settling State at the end of the calendar quarter (the quarterly periods to end on February 20, May 20, August 20, and November 20 of each year) in which service of such claim is received (or within 30 days after the MSA Execution Date, whichever is later) (unless such potential claim is being maintained by such Settling State); provided, however, that service of any claims received within 15 days before the end of any quarterly period shall be deemed to have been received during the subsequent calendar quarter."

AMENDMENT # 4 TO MASTER SETTLEMENT AGREEMENT

Notwithstanding sections II(jj) and II(uu) of the Master Settlement Agreement ("MSA"), ITL (USA) Limited ("ITL (USA)") shall be considered to be a Tobacco Product Manufacturer and a Participating Manufacturer, and Imperial Tobacco Limited and Imasco Limited (collectively "Imperial") shall for purposes of the MSA not be considered to be a Tobacco Product Manufacturer at any time after the MSA Execution Date (and Imperial shall, for purposes of the Model Statute set forth in Exhibit T to the MSA only, be considered to be a Participating Manufacturer), provided that:

(1) ITL (USA) signs the MSA within 90 days after the MSA Execution Date and is bound by the MSA in all Settling States in which such Agreement binds Original Participating Manufacturers;

(2) Any Cigarettes manufactured by Imperial, or under trademarks owned by or licensed to Imperial, that Imperial intends to be sold in the States (collectively, "Imperial Cigarettes") are sold in the States only through one or more importer (collectively, "Imperial Importers") each of whom: (A) is a Participating Manufacturer; (B) will be responsible for the payments under the MSA with respect to the Imperial Cigarettes that it imports, is obligated to pay the taxes specified in subsection II(z) of the MSA on the Imperial Cigarettes that it imports, and is obligated to report the Imperial Cigarettes that it imports (if shipped in or to the fifty United States, the District of Columbia and Puerto Rico) as its shipments in the manner prescribed in subsection II(jj) of the MSA; (c) is obligated, after the date of this Amendment, not to import, sell or distribute Cigarettes manufactured (or purchased for resale in the States) by a Non-Participating Manufacturer; and (D) is either an Original Participating Manufacturer or a present or future Affiliate of Imperial (provided that, in calculating payment obligations under section of IX(I) of the MSA attributable to Imperial Cigarettes imported by a future Affiliate of Imperial that is itself a Subsequent Participating Manufacturer as of February 22, 1999 (other than preexisting brands of the future Affiliate itself), the 1997 and 1998 Market Shares (and 125 percent thereof) of such Affiliate shall be deemed to equal zero);

(3) Imperial fulfills the responsibilities and obligations set forth in paragraph 2(B) to the extent that an Imperial Importer fails to do so and Imperial undertakes good-faith efforts to enforce the obligation set forth in paragraph 2(C);

(4) Neither Imperial nor any other manufacturer of Imperial Cigarettes advertises or markets Imperial Cigarettes in the States;

(5) (A) The Supplemental Import and Distribution Agreement dated February 10, 1999 among ITL (USA), Imasco Limited and Imperial Tobacco Limited attached hereto as Exhibit A remains in full force and effect and the parties are in full compliance therewith (unless ITL (USA) ceases to import and does not import Imperial Cigarettes); and (B) Imperial enters into similar agreements with every Imperial Importer (except for ITL (USA) or an Imperial Importer that is an Original Participating Manufacturer) each of which agreements contains all of the substantive terms set forth in the Supplemental Import and Distribution Agreement attached hereto as Exhibit A, and the parties thereto are in full compliance with such terms (unless the Imperial Importer in question ceases to

[Initialed by "BR"]

import and does not import Imperial Cigarettes); provided, however, that it shall also be deemed to be full compliance with this paragraph (5) if Imperial (A) ceases to manufacture and does not manufacture Cigarettes that Imperial intends to be sold in the States; and (B) ceases to intend and does not intend that Cigarettes manufactured under trademarks owned by or licensed to Imperial be sold in the States;

(6) For purposes of sections IX(i) and IX(d)(l)(B) of the Master Settlement Agreement, ITL (USA)’s 1997 and 1998 Market Share: (A) shall not include cigarettes manufactured (or purchased for resale in the States) by any Non-Participating Manufacturer; and (B) shall include the Market Share for 1997 or 1998, whichever is in question, of Imperial, if any, with respect to brands of Imperial Cigarettes as to which ITL (USA) has exclusive import and distribution rights in the States with respect to the entire calendar year immediately preceding the year in which the calculation in question is being made (but only if and so long as the conditions specified in paragraphs (1)-(5) above are and continue to be met).

 

All capitalized terms not otherwise defined shall have the meaning given such terms in the Master Settlement Agreement, except that "Affiliate" shall mean: "a person who directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or control with, another person. Solely for purposes of this definition, the terms ‘owns,’ ‘is owned’ and ‘ownership’ mean ownership of an equity interest, or the equivalent thereof, of 50 percent or more, and the term ‘person’ means an individual, partnership, committee, association, corporation or any other organization of group of persons."

[Initialed by "BR"]

 

Dated: February 10, 1999
New York, N.Y.

ITL (USA) LIMITED

By: /s/ BILL ROSE
WILLIAM ROSE
VICE PRESIDENT

 

 

EXHIBIT A TO AMENDMENT TO MASTER SETTLEMENT AGREEMENT

SUPPLEMENTAL IMPORT AND DISTRIBUTION AGREEMENT

This Supplemental Import and Distribution Agreement dated February 10, 1999 made by and between Imperial Tobacco Limited, a company duly incorporated under the Canada Business Corporation Act with its principal office at 3810 St. Antoine Street West, Montreal, Quebec, Canada H4C 1B5, Montreal, Canada, and Imasco Limited, a company duly incorporated under the Canada Business Corporation Act with its principal office at 600 de Maisonneuve Blvd. West, 20th floor, Montreal, Quebec, H3A 3K7, Montreal, Canada (collectively, the "Manufacturer/Exporter"), as the first party and ITL (USA) Limited (the "Importer"), a company duly incorporated under the laws of the State of Delaware, U.S.A. with its principal office at Heritage on the Garden, 75 Park Plaza, Boston, Massachusetts 02116, as the second party.

 

WITNESSETH:

WHEREAS, the Manufacturer/Exporter is engaged in the business, among other things, of exporting from Canada and selling to persons in the territory of the U.S.A. Cigarettes manufactured by and under trademarks owned by or licensed to the Manufacturer/Exporter;

WHEREAS, the Importer maintains a marketing organization and markets cigarettes in the area defined below as the Territory;

WHEREAS, the Manufacturer/Exporter and the Importer desire to promote the sale of said Cigarettes in said Territory;

[Initialed by "RRS" "DRB" "BR"]

 

WHEREAS, the Manufacturer/Exporter and the Importer have previously entered into and currently conduct business pursuant to a Supply Agreement dated April 5, 1993 (the "Supply Agreement") providing that the Importer is the exclusive importer and distributor for effecting the import and distribution in said Territory of said Cigarettes under the brand names listed in Appendix A, and now wish to supplement the terms of said agreement in order to permit ITL (USA) to execute an amendment to the Master Settlement Agreement of November 23, 1998 (the "MSA") in order to become a Participating Manufacturer under that agreement (the "Amendment");

WHEREAS, the Manufacturer/Exporter desires to continue the appointment of the Importer on the terms and conditions set forth in the Supply Agreement (and as hereinafter set forth) as its exclusive importer and distributor for effecting the import and distribution of said Cigarettes under said brand names in the Territory;

WHEREAS, the Importer remains willing to act under such appointment as importer and distributor of said Cigarettes subject to terms and conditions; and

WHEREAS, the parties hereto intend that the Settling States and the Original Participating Manufacturers (as those terms are defined in the MSA) be deemed third-party beneficiaries of this Supplemental Import and Distribution Agreement.

Now, therefore, in consideration of the mutual covenants and acknowledgments herein made, the parties hereto agree that the following terms amend and control the terms of the Supply Agreement between the Importer and the Manufacturer/Exporter:

[Initialed by "RRS" "DRB" "BR"]

1. APPOINTMENT

The Manufacturer/Exporter hereby reaffirms its appointment of the Importer as its exclusive importer and distributor for sale in the territory of any state of the United States, the District of Columbia, the Commonwealth of Puerto Rico, Guam, the Virgin Islands, American Samoa and the Northern Marianas (the "Territory") of any and all Cigarettes (as such term is defined in the MSA) under any of the brand names listed in Appendix A which are and will be manufactured by the Manufacturer/Exporter or any licensee or Affiliate of the Manufacturer/Exporter and exported for intended sale in the Territory (and any other brand names as may be added from time to time, of which the Manufacturer/Exporter shall give notice to the Notice Parties as soon as reasonably practicable after their addition), subject to the terms and conditions appearing in this Agreement. The term "Affiliate" as used herein shall mean a person who directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or control with another person. Solely for purpose of this definition, the terms "owns", "is owned" and "ownership" mean ownership of any equity interest, or the equivalent thereof, of 50 percent or more, and the term "person" means an individual, partnership, committee, association, corporation or any other organization of group of persons.

 

2. EXCLUSIVITY

Subject to the provisions of section 4 below, the Manufacturer/Exporter shall not appoint any person other than the Importer as an additional importer and distributor for sale within the Territory of the Cigarettes described in section 1 above and shall not sell or distribute such Cigarettes in the Territory except through the Importer. The Manufacturer/Exporter shall not market or advertise such Cigarettes in the Territory.

[Initialed by "RRS" "DRB" "BR"]

3. COMPLIANCE WITH LAW

The Manufacturer/Exporter shall supply Cigarettes which comply with the requirements and applicable regulations effective in the Territory.

The Importer shall obtain all the governmental certification, license, permit or approval necessary to import and distribute Cigarettes in the Territory and shall sell the Cigarettes in the Territory in strict compliance with any and all laws, regulations and other requirements of federal, state, and local governments and their agencies. The Importer shall be responsible for the payments under the MSA with respect to the Cigarettes described in section 1 above, shall pay the taxes specified in subsection II(z) of the MSA on such Cigarettes, and shall report such Cigarettes (if shipped in or to the fifty United States, the District of Columbia and Puerto Rico) as its shipments in the manner prescribed in subsection II(jj) of the MSA.

4. DURATION AND TERMINATION

This Agreement shall be effective on the day and year first above written and shall continue for an initial period of two years. Thereafter this Agreement shall be automatically renewed upon the same terms and conditions, for successive additional terms of two years each, unless at least ninety (90) days prior to the expiration of the initial or renewal term, as the case may be, one party shall give the other party written notice of its desire to terminate this Agreement upon the expiration of the term then in effect; provided, however, that as long as the MSA remains in effect, this Agreement shall not be terminated by any party under this paragraph, any other paragraph hereof or any provision of the Supply Agreement unless the Manufacturer/Exporter has appointed another entity or entities meeting the requirements set forth in paragraph (2)(A)-(D) of the Amendment as importer(s) for the Territory of the Cigarettes

[Initialed by "RRS" "DRB" "BR"]

described in section 1 above pursuant to an agreement with like terms as this Agreement. Provided, however, that the Manufacturer/Exporter may terminate this Agreement without appointing a new importer if both Imperial Tobacco Limited and Imasco Limited cease to manufacture and do not manufacture Cigarettes that either company intends to be sold in the States, and cease to intend and does not intend that Cigarettes manufactured under trademarks owned by or licensed to either Imperial Tobacco Limited or Imasco Limited be sold in the States.

All capitalized terms not otherwise defined shall have the meaning given such terms in the MSA.

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement on the day and year first above written.

ITL (USA) Limited

By WILLIAM ROSE, VICE PRESIDENT
/s/ BILL ROSE

Imperial Tobacco Limited

By DONALD R. BROWN, PRESIDENT, CHAIRMAN AND CHIEF EXECUTIVE OFFICER
/s/ D. R. BROWN

Imasco Limited

By ROY SCHWARTZ, SENIOR VICE PRESIDENT
/s/ ROY R. SCHWARTZ

 

AMENDMENT TO SUPPLEMENTAL IMPORT AND DISTRIBUTION AGREEMENT DATED

FEBRUARY 10, 1999.

The Supplemental Import and Distribution Agreement entered into among ITL (USA) Limited, Imasco Limited, and Imperial Tobacco Limited dated February 10, 1999 is hereby amended so that Appendix A, being the list of brands distributed through ITL (USA) Limited, is replaced by the Appendix A-1attached hereto.

MONTREAL, February 19, 1999.

/s/ Bill Rose
ITL (USA) LIMITED

/s/ D.R. Brown
IMASCO LIMITED

/s/ D.R. Brown
IMPERIAL TOBACCO LIMITED

 

AMENDMENT # 5 TO MASTER SETTLEMENT AGREEMENT

Notwithstanding sections II(jj) and II(uu) of the Master Settlement Agreement, Japan Tobacco International, U.S.A. Inc. shall be considered to be a Tobacco Product Manufacturer and a Participating Manufacturer, and Japan Tobacco Inc. shall not be considered to be a Tobacco Product Manufacturer (and shall, for purposes of the Model Statute set forth in Exhibit T to the Master Settlement Agreement only, be considered to be a Participating Manufacturer), provided that:

(1) Japan Tobacco International U.S.A., Inc. signs the Master Settlement Agreement within 90 days after the MSA Execution Date and is bound by such Agreement in all Settling States in which such Agreement binds Original Participating Manufacturers;

(2) The agreement dated January 13, 1999 between Japan Tobacco Inc. and Japan Tobacco International Corp., on the one hand, and Japan Tobacco International U.S.A., Inc., on the other hand, attached hereto as Exhibit A remains in full force and effect and both parties thereto fully perform their obligations thereunder;

(3) Japan Tobacco International, U.S.A. Inc. does not, after the date of this agreement, import, sell or distribute cigarettes manufactured (or purchased for resale in the States) by a Non-Participating Manufacturer; and

(4) For purposes of sections IX(i) and IX(d)(1)(B) of the Master Settlement Agreement, Japan Tobacco International U.S.A., Inc.’s 1997 and 1998 Market Share: (A) shall not include cigarettes manufactured (or purchased for resale in the States) by any Non-Participating Manufacturer; and (B) shall include the Market Share for 1997 or 1998, whichever is in question, of Japan Tobacco Inc. (but only so long as the conditions specified in paragraphs (1)-(3) above are met).

All capitalized terms shall have the meaning given such terms in the Master Settlement Agreement.

 

Dated: February 5, 1999

New York, N.Y.

JAPAN TOBACCO INTERNATIONAL U.S.A., INC.

By: Name: /s/ Masayuki Hamada
Title: President

 

EXHIBIT A

[end Ex. A cover page]*

 

[begin page 1 of Ex. A]*

IMPORT AND DISTRIBUTION AGREEMENT

This Import and Distribution Agreement dated 13th day of January, 1999 made by and between JT International Corp. (the "Exporter"), a company duly incorporated according to the laws of Japan with its principal office at JT Building, 2-l Toranomon 2-chome, Minato-ku, Tokyo, Japan, and Japan Tobacco Inc. (the "Manufacturer"), a company duly incorporated according to the laws of Japan with its principal office at JT Building, 2-l Toranomon 2-chome, Minato-ku, Tokyo, Japan, jointly and severally, as the first party (the "Manufacturer/Exporter") and Japan Tobacco International U.S.A., Inc. ("the Importer"), a company duly incorporated according to the laws of the State of California, U.S.A. with its principle office at 2441 205th Street, Suite C-102, Torrance, CA 90501, U.S.A., as the second party.

WITNESSETH:

WHEREAS, the Exporter is exclusively engaged in the business, among other things, of exporting from Japan and selling to the territory of the U.S.A. all cigarettes manufactured by and under trademarks of the Manufacturer;

WHEREAS, the Importer maintains a market organization and markets cigarettes in the area as defined as the Territory below;

WHEREAS, the Manufacturer/Exporter and the Importer desire to promote the sale of said cigarettes in said Territory;

WHEREAS, the Manufacturer/Exporter desires to continue the appointment of the Importer on the terms and conditions hereinafter set forth as its exclusive importer and distributor for effecting the import and distribution of said cigarettes; and

WHEREAS, the Importer is willing to accept such appointment as exclusive importer and distributor of said cigarettes subject to such terms and conditions.

 

NOW, THEREFORE, in consideration of the mutual covenants and acknowledgments herein made the

parties hereto agree as follows:

1. IMPORTER

1.1 Appointment

The Manufacturer/Exporter hereby appoints the Importer as its exclusive importer and distributor for sale in the territory of any state of the United States, the District of Columbia, the Commonwealth of Puerto Rico, Guam, the Virgin Islands, American Samoa, and the Northern Marianas (the "Territory") of any and all Cigarettes (as such term is defined in the Master Settlement Agreement dated November 23, 1998 referred to hereinafter as the "MSA") which are and will be manufactured by the Manufacturer or any Affiliate thereof and exported for intended sale in the Territory, subject to the terms and conditions appearing in this Agreement. The term "Affiliate" as used herein shall mean a person who directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or control with, another person. Solely for purpose of this definition, the terms "owns", "is owned" and "ownership" mean ownership of an equity interest, or the equivalent thereof, of 50 percent or more, and the term "person" means an individual, partnership, committee, association, corporation or any other organization of group of persons.

1.2 Exclusivity

The Manufacturer/Exporter shall not appoint any person other than the Importer as an additional importer and distributor for sale of the Cigarettes within the Territory nor shall the Manufacturer/Exporter sell or distribute the Cigarettes in the Territory except through the Importer or market or advertise the Cigarettes in the Territory.

1.3 Sub-distributor/Sub-importer

The Importer may appoint sub-distributor(s) and/or sub-importer(s) without the prior written consent of the Manufacturer/Exporter. Such appointment shall not constitute any commitment by the Manufacturer/Exporter to any contractual relationship with the sub-distributor(s) and the sub-importer(s). The Importer shall keep the Manufacturer/Exporter informed as to the identities of all such the sub-distributor(s)

and sub-importer(s).

2. RELATIONS BETWEEN PARTIES

2.1 Legal relationship

The Importer shall conduct its business on its own account, at its own risk and in its own name and shall not act as an agent or legal representative of the Manufacturer/Exporter nor give any warranty or make or agree to any condition on behalf of the Manufacturer/Exporter nor incur any obligation or other commitment for or otherwise act in the same name of the Manufacturer/Exporter unless expressly authorized in writing by the Manufacturer/Exporter.

2.2 Report

To ensure the smooth operation of this Agreement and successful business arrangements between the parties, the Importer shall furnish the Manufacturer/Exporter, on a regular basis, reports showing the quantity of sale, retail price and stock of the Cigarettes and market condition in the Territory with supporting data.

3. NAME AND TRADEMARK

3.1 Trademark right

It is acknowledged by both parties hereto that the words "JT", "Japan Tobacco", "Japan Tobacco Inc." and "JT Inc." whether used as brand names or trade names as well as any of the trademarks under or in relation to which the Cigarettes are distributed and sold (the "Names and Marks"), shall be the property of the Manufacturer. Nothing herein contained shall be construed as transferring any patent, utility model, trademark, design or copyright in the Cigarettes or the Names and Marks; all such rights are expressly reserved to the true and lawful owners thereof. This Agreement shall not be construed to grant to the Importer the right of using the Names and Marks of their owners except for the purpose of advertising and selling the Cigarettes in the Territory. The Importer shall not register any of the Names and Marks without written consent by their owners under any circumstances.

3.2 Infringement by a third party

If the Importer has found that trademarks, copyrights or other intellectual property rights in terms of the Cigarettes or the Names and Marks are disputed or infringed upon by a third party, the Importer shall promptly inform the Manufacturer/Exporter thereof and assist the Manufacturer/Exporter to take steps necessary to protect its rights.

4. DISTRIBUTION

4.1 Manner of business

The Importer shall conduct its business in a manner that will reflect favorably at all times on the Manufacturer/Exporter, the Cigarettes and the good name, goodwill and reputation thereof, and shall avoid in every way any deceptive, misleading, unlawful or unethical practice that is or might be detrimental to the Manufacturer/Exporter or the Cigarettes.

4.2 Stocks

The Importer shall always carry in stock an adequate quantity of the Cigarettes to the extent commercially appropriate to actively promote demand for the Cigarettes within the Territory.

4.3 Information on sub-distributor(s)/sub-importer(s)

The Importer shall supply to Manufacturer/Exporter full names of sub-distributor(s) and/or sub-importer(s) appointed by the Importer within the Territory together with volume of the Cigarettes dealt with by each of such sub-distributor(s) and sub-importer(s) with such additional details as the Manufacturer/Exporter may reasonably request. All changes to the information so supplied shall be notified in writing by the Importer to the Manufacturer/Exporter as they occur.

5. COMPLIANCE WITH LAW

The Manufacturer/Exporter shall supply the Cigarettes which comply with the requirements or applicable regulations effective in the Territory. The Importer shall obtain all the governmental certification, license, permit or approval necessary to import and distribute the Cigarettes in Territory and shall sell the Cigarettes in the Territory in strict compliance with any and all laws, regulations and other requirements of federal, state, and local governments and their agencies. The Importer shall be responsible for the payments under the MSA with respect to the Cigarettes and shall pay the taxes specified in subsection II(z) of the MSA on the Cigarettes.

6. SALES CONTRACT

6.1 Individual contract

The Importer agrees to purchase the Cigarettes from the Manufacturer/Exporter under individual sales contracts to be agreed upon separately between the Importer and the Manufacturer/Exporter. The Manufacturer/Exporter may accept orders or not, at its option and discretion; provided, however, that such acceptance shall not be unreasonably withheld. The Manufacturer/Exporter will not be held liable for loss or damage caused by its non-acceptance of orders or by any delay in making delivery.

6.2 Prices

All orders from the Importer will be priced at the then current prices of the Manufacturer/Exporter as of the date of order placement. The Manufacturer/Exporter reserves the right to change its prices for the Cigarettes at any time. Provided, that price changes shall not apply to orders for the Cigarettes which have been accepted by the Manufacturer/Exporter.

6.3 Payment

Payment for prices from the Importer to the Manufacturer/Exporter shall be effected by a wire transfer of net cash to the bank account designated by the Manufacturer/Exporter.

6.4 Title

Title to each of the Cigarettes purchased by the Importer shall pass to the Importer in accordance with the terms of F.O.B. (Incoterms 1990) at the port of Tokyo or Yokohama, Japan.

7. DURATION AND TERMINATION

7.1 Duration

This Agreement shall be effective on the day and year first above written and shall continue for an initial period of two years. Thereafter this Agreement shall be automatically renewed upon the same terms and conditions, for successive additional terms of two years each, unless at least ninety (90) days prior to the expiration of the initial or renewal term, as the case may be, one party shall give the other party written notice of its desire to terminate this Agreement upon the expiration of the term then in effect; provided, however, that this Agreement shall not be terminated by either party under this paragraph or any other paragraph hereof unless Manufacturer/Exporter have appointed another signatory to the MSA as exclusive importer for the Territory pursuant to an agreement with like terms insofar as related to the MSA as long as the MSA remains in effect. It is hereby acknowledged that the Original Participating Manufacturers and the Settling States to the MSA are third party beneficiaries of this and any other provision herein relating to the MSA.

7.2 Termination

Each party may terminate without prejudice to any other remedies available to it, this Agreement by written notice given to the other party, effective immediately, in any one of the following events:

a) in the event the other party fails to cure the breach of one or more of its material obligations under the terms of this Agreement within 30 days after the receipt of a notice specifying the nature of the breach and requiring the other party to make it good; or

b) in the event the other party becomes insolvent or bankrupt, or has made an assignment for the benefit of its creditors, or a trustee or receiver of the other party is appointed for all or substantial part of its property, or petition for commencement of bankruptcy, reorganization, dissolution or other similar proceeding has been filed;

c) in the event any change in the substantial interest in the direct or indirect ownership of the other party by sale, transfer or relinquishment, voluntary or involuntary, by operation of law or otherwise, of such interest, which would impair the trustful relationship between the parties hereto.

7.3 Effect of Termination

Upon termination of the Agreement, the terminating party may at its option wholly or partly cancel or immediately fulfill any outstanding order. Neither the Manufacturer/Exporter nor the Importer is, by reason of the termination of this Agreement, liable to the others for compensation, reimbursement of damages on account of expenditures, investments or commitments made in connection therewith or in connection with the establishment, development or maintenance of the business or goodwill of the Manufacturer/Exporter or the Importer or on account of any other cause whatsoever, provided, however, that such termination does not affect the Importer’s obligation to pay in full for all the Cigarettes previously sold hereunder to the Importer. It is also explicitly agreed by both parties that should this Agreement be terminated by the written notice by one party upon the expiration of term in effect pursuant to paragraph 7.1 above, neither party shall claim any compensation, reimbursement of damages or otherwise any monetary nature against the other party for any reason except the payment for the price of the Cigarettes, if outstanding as of the date of the termination, which were delivered prior thereto.

8. GENERAL

8.1 Nonassignability

The Importer shall not assign this Agreement or any rights herein conferred on the Importer without the prior written consent of the Manufacturer/Exporter.

8.2 Secrecy

During the term of this Agreement and thereafter, the Importer and the Manufacturer/Exporter shall maintain in strict confidence any and all matters relating to the transactions covered by this Agreement unless authorized otherwise by the other party in writing.

8.3 Governing Law

This Agreement shall be deemed to be a contract made under and shall be governed solely by and construed in accordance with the laws of Japan.

8.4 Arbitration

All disputes, controversies, or differences which may arise among the parties hereto, in connection with this Agreement or for the breach thereof, shall be settled by arbitration in Tokyo, Japan in accordance with the rules of the Japan Commercial Arbitration Association. The award rendered by the arbitrators shall be final and binding upon the parties.

8.5 Entire Agreement

This Agreement contains the entire and only agreement by and among the Manufacturer/Exporter and the Importer with respect to the subject matter hereof.

8.6 Amendment

Except as provided in paragraph 6.2 above hereof no change, modification or amendment of this Agreement shall be binding upon the Manufacturer/Exporter or the Importer unless made in writing and signed by the Manufacturer/Exporter and the Importer.

8.7 Force Majeure

No party shall be responsible to the others for failure to conform to this Agreement for reasons beyond their control; including but not limited to force majeure such as strikes, labor disputes, floods, civil commotion, war, riot, act of God, governmental rules, laws or actions, fires, embargoes, quotas or other unavoidable causes.

8.8 Waiver

No delay or omission or failure to exercise any right or remedy provided for herein shall be deemed to be a waiver thereof or acquiescence in the event giving rise to such right or remedy.

8.9 Notice

Any notice given under this Agreement shall be made by prepaid registered airmail, cable, telex or fax to the address mentioned below or to such address as is notified in writing by the parties hereto. If any one of the parties changes its address, a written notice thereof shall be given to the other party. All notices by registered airmail shall be deemed to have been given on the tenth (10th) business day following the date of posting thereof. All notices by cable or telex, which shall become effective when it arrives at the addressee, shall be followed by a copy thereof sent by prepaid registered airmail:

To: Japan Tobacco Inc. and JT International Corp.
JT Building, 2-l Toranomon 2-chome, Minato-ku, Tokyo, Japan

To: Japan Tobacco International U.S.A., Inc.
2441 205th Street, Suite C-102, Torrance, [C]A 90501, U.S.A.

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement on the day and year first above written.

Japan Tobacco Inc.
By: /s/ Hidoshi Fujishiro
Hidoshi Fujishiro
Managing Director, Tobacco Business Planning

JT International Corp.
By: /s/ Toshio Kikuma
Toshio Kikuma
President

Japan Tobacco International U.S.A., Inc.
By: /s/ Masayuki Hamada
Masayuki Hamada
President

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AMENDMENT NO. 6 TO MASTER SETTLEMENT AGREEMENT

Tobacco Exporters International (USA) Ltd. ("TEI") hereby signs and executes the Master Settlement Agreement ("MSA").

In addition, notwithstanding sections II(jj) and II(uu) of the MSA, TEI shall have the rights specified in paragraph (4) below, and each of the companies specified in Exhibit A to this Amendment (collectively the "Foreign Manufacturers/Exporters") shall not be considered to be a Tobacco Product Manufacturer (and each Foreign Manufacturer/Exporter shall, for the purposes of the Model Statute set forth in Exhibit T to the MSA only, be considered to be a Participating Manufacturer), provided that:

(1) TEI signs the MSA within 90 days after the MSA Execution Date and is bound by such Agreement in all Settling States in which such Agreement binds Original Participating Manufacturers;

(2) On or before March 31, 1999, TEI enters into an agreement (an "Exclusive Distribution Agreement") with each of the Foreign Manufacturers/Exporters, such Exclusive Distribution Agreements remain in full force and effect, and all the parties to each respective Exclusive Distribution Agreement fully perform their obligations thereunder. Each Exclusive Distribution Agreement must contain the following terms:

(A) The Foreign Manufacturer/Exporter appoints TEI as its exclusive importer and distributor (other than as set forth in paragraph (D) below) for sale in the territory of any state of the United States, the District of Columbia, the Commonwealth of Puerto Rico, Guam, the Virgin Islands, American Samoa and the Northern Marianas (the "Territory") of any and all Cigarettes which are and will be manufactured by the Foreign Manufacturer/Exporter or any licensee or Affiliate of the Foreign Manufacturer/Exporter under trademarks owned by the Foreign Manufacturer/Exporter (or as to which trademarks the Foreign Manufacturer/Exporter has a manufacturing or license agreement with the trademark owner) and exported for intended sale in the Territory, subject to the terms and conditions appearing in the Exclusive Distribution Agreement (insofar as such terms and conditions are not inconsistent with paragraphs (A) through (F)). The term "Affiliate" as used herein shall mean a person who directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or control with, another person. Solely for the purpose of this definition, the terms "owns," "is owned" and "ownership" means ownership of an equity interest, or the equivalent thereof, of 50 percent or more, and the term "person" means an individual, partnership, committee, association, corporation or any other organization of group of persons.

(B) Other than as specified in paragraph (D) below, the Foreign Manufacturer/Exporter shall not appoint any person other than TEI as an additional importer and distributor for sale of the Cigarettes within the Territory, nor shall the Foreign Manufacturer/Exporter sell or distribute the Cigarettes in the Territory except through TEI or market or advertise the Cigarettes in the Territory.

(C) The Foreign Manufacturer/Exporter shall supply the Cigarettes, which shall comply with the requirements or applicable regulations effective in the Territory. TEI shall obtain all the governmental certification, license, permit or approval necessary to import and distribute the Cigarettes in the Territory and shall sell the Cigarettes in the Territory in strict compliance with any and all laws, regulations and other requirements of federal, state, and local governments and their agencies. TEI shall be responsible for the payments under the MSA with respect to the Cigarettes, shall pay the taxes specified in subsection II(z) of the MSA on the Cigarettes, and shall report the Cigarettes as its shipments in the manner prescribed in subsection II(mm) of the MSA.

(D) The Foreign Manufacturer/Exporter may sell brands of Cigarettes in the Territory through an importer other than TEI if such importer is an Original Participating Manufacturer that will be responsible for the payments under the MSA with respect to such Cigarettes as a result of the provisions of subsections II(mm) of the MSA and that pays the taxes specified in subsection II(z) on such Cigarettes, and provided that the Foreign Manufacturer/Exporter does not market or advertise such Cigarettes in the States.

(E) Each Exclusive Distribution Agreement between each Foreign Manufacturer/Exporter and TEI shall be effective on the date of execution of that agreement (which shall be on or before March 31, 1999) and shall not be terminated by either party to that agreement unless the Foreign Manufacturer/Exporter in question has appointed another signatory to the MSA as importer for the Territory as long as the MSA remains in effect.

(F) The Settling States and the Original Participating Manufacturers are third-party beneficiaries of each Exclusive Distribution Agreement.

(3) TEI does not, after the date TEI becomes a signatory to the MSA, import, sell or distribute Cigarettes manufactured (or purchased for resale in the States) by a Non-Participating Manufacturer;

(4) For purposes of sections IX(i) and IX(d)(1)(B) of the MSA, TEI’s 1997 and 1998 Market Share: (A) shall not include Cigarettes manufactured (or purchased for resale in the States) by any Non-Participating Manufacturer; and (B) shall include the Market Share for 1997 and 1998, whichever is in question, of each of the Foreign Manufacturers/Exporters, if any, with respect to brands of Cigarettes as to which TEI has exclusive import and distribution rights in the States with respect to the entire calendar year immediately preceding the year in which the calculation in question is being made (but only so long as the conditions specified in paragraphs (1)-(3) above for each Foreign Manufacturer/Exporter are met);

(6) Notwithstanding paragraph (4), if TEI becomes an Affiliate of an Original Participating Manufacturer, TEI assumes the payment obligations under the MSA of an Original Participating Manufacturer with respect to all Cigarettes shipped by TEI in or to the Territory.

All capitalized terms not otherwise defined shall have the meaning given such terms in the MSA.

Dated: February 11, 1999
New York, N.Y.

TOBACCO EXPORTERS INTERNATIONAL
(USA) LTD.

By: /s/ Robert S. Pless
Vice President and General Counsel

 

EXHIBIT A

Foreign Manufacturer: Foreign Exporter:

1. Rothmans of Pall Mall (International) Tobacco Exporters International Limited
Limited Oxford Road
Green Lane Industrial Estate Aylesbury
Spennymoor Bucks HP21 8SZ
Co. Durham DL 16 6YA England
England

2. Rothmans of Pall Mall (International) Tobacco Exporters International Limited
Limited Oxford Road
P.O. Box 41 Aylesbury
McMullen Road Bucks HP21 8SZ
Darlington England
C. Durham DL1 YS
England

3. Rothmans Manufacturing (The Tobacco Exporters International Limited
Netherlands) b.v. Oxford Road
Kerkstraat 27 Aylesbury
6901 AA Zevenaar Bucks HP21 8SZ
The Netherlands England

4. Rothmans, Benson & Hedges Inc. Rothmans, Benson & Hedges Inc.
1500 Don Mills Road 1500 Don Mills Road
North York North York
Ontario M3B 3L1 Ontario M3B 3L1
Canada Canada

5. Cigarette Company of Jamaica Limited Cigarette Company of Jamaica Limited
Twickenham Park Twickenham Park
P. O. Box 100 P. O. Box 100
Spanish Town Spanish Town
Jamaica W.I. Jamaica W.I.

 

AMENDMENT NO. 7 TO MASTER SETTLEMENT AGREEMENT

Lane Limited ("Lane") hereby signs and executes the Master Settlement Agreement ("MSA"). In addition, notwithstanding sections II(jj) and II(uu) of the MSA, Lane shall have the rights specified in paragraph (4) below, and the companies specified in Exhibit A to this Amendment (collectively the "Foreign Manufacturer/Exporter") shall not be considered to be a Tobacco Product Manufacturer (and the Foreign Manufacturer/Exporter shall, for the purposes of the Model Statute set forth in Exhibit T to the MSA only, be considered to be a Participating Manufacturer), provided that:

(1) Lane signs the MSA within 90 days after the MSA Execution Date and is bound by such Agreement in all Settling States in which such Agreement binds Original Participating Manufacturers;

(2) On or before March 31, 1999, Lane enters into an agreement (an "Exclusive Distribution Agreement") with the Foreign Manufacturer/Exporter, such Exclusive Distribution Agreement remains in full force and effect, and all the parties to the Exclusive Distribution Agreement fully perform their obligations thereunder. The Exclusive Distribution Agreement must contain the following terms:

(A) The Foreign Manufacturer/Exporter appoints Lane as its exclusive importer and distributor (other than as set forth in paragraph (D) below) for sale in the territory of any state of the United States, the District of Columbia, the Commonwealth of Puerto Rico, Guam, the Virgin Islands, American Samoa and the Northern Marianas (the "Territory") of any and all Cigarettes which are and will be manufactured by the Foreign Manufacturer/Exporter or any licensee or Affiliate of the Foreign Manufacturer/Exporter under trademarks owned by the Foreign Manufacturer/Exporter (or as to which trademarks the Foreign Manufacturer/Exporter has a manufacturing or license agreement with the trademark owner) and exported for intended sale in the Territory, subject to the terms and conditions appearing in the Exclusive Distribution Agreement (insofar as such terms and conditions are not inconsistent with paragraphs (A) through (F)). The term "Affiliate" as used herein shall mean a person who directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or control with, another person. Solely for the purpose of this definition, the terms "owns," "is owned" and "ownership" means ownership of an equity interest, or the equivalent thereof, of 50 percent or more, and the term "person" means an individual, partnership, committee, association, corporation or any other organization of group of persons.

(B) Other than as specified in paragraph (D) below, the Foreign Manufacturer/Exporter shall not appoint any person other than Lane as an additional importer and distributor for sale of the Cigarettes within the Territory, nor shall the Foreign Manufacturer/Exporter sell or distribute the Cigarettes in the Territory except through Lane or market or advertise the Cigarettes in the Territory.

(C) The Foreign Manufacturer/Exporter shall supply the Cigarettes, which shall comply with the requirements or applicable regulations effective in the Territory. Lane shall obtain all the governmental certification, license, permit or approval necessary to import and distribute the Cigarettes in the Territory and shall sell the Cigarettes in the Territory in strict compliance with any and all laws, regulations and other requirements of federal, state, and local governments and their agencies. Lane shall be responsible for the payments under the MSA with respect to the Cigarettes, shall pay the taxes specified in subsection II(z) of the MSA on the Cigarettes, and shall report the Cigarettes as its shipments in the manner prescribed in subsection II(mm) of the MSA.

(D) The Foreign Manufacturer/Exporter may sell brands of Cigarettes in the Territory through an importer other than Lane if such importer is an Original Participating Manufacturer that will be responsible for the payments under the MSA with respect to such Cigarettes as a result of the provisions of subsections II(mm) of the MSA and that pays the taxes specified in subsection II(z) on such Cigarettes, and provided that the Foreign Manufacturer/Exporter does not market or advertise such Cigarettes in the States.

(E) The Exclusive Distribution Agreement between the Foreign Manufacturer/Exporter and Lane shall be effective on the date of execution of that agreement (which shall be on or before March 31, 1999) and shall not be terminated by either party to that agreement unless the Foreign Manufacturer/Exporter has appointed another signatory to the MSA as importer for the Territory as long as the MSA remains in effect.

(F) The Settling States and the Original Participating Manufacturers are third-party beneficiaries of the Exclusive Distribution Agreement.

(5) Notwithstanding paragraph (4), if the Foreign Manufacturer/Exporter becomes an Affiliate of an Original Participating Manufacturer, Lane does not import the Cigarettes of such Foreign Manufacturer/Exporter unless Lane assumes the payment obligations under the MSA of an Original Participating Manufacturer with respect to all Cigarettes manufactured by (or under trademarks owned by or licensed to) the Foreign Manufacturer/Exporter and imported by Lane; and

(6) Notwithstanding paragraph (4), if Lane becomes an Affiliate of an Original Participating Manufacturer, Lane assumes the payment obligations under the MSA of an Original Participating Manufacturer with respect to all Cigarettes shipped by Lane in or to the Territory.

All capitalized terms not otherwise defined shall have the meaning given such terms in the MSA.

Dated: February 11, 1999
New York, N.Y.

LANE LIMITED

By: /s/ Robert S. Pless
Robert S. Pless
Assistant Secretary and General Counsel

 

EXHIBIT A

Foreign Manufacturer: Foreign Exporter:

1. Koninklijke Theodorus Rothmans International Tobacco Products
Niemeyer B. V. (Export) B. V.
43 Paterswoldseweg De Boelelaan 32
P. O. Box 41 1083 HJ Amsterdam
9700 AA Groningen The Netherlands
The Netherlands

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AMENDMENT NUMBER 8 TO MASTER SETTLEMENT AGREEMENT

WHEREAS, Lignum-2, Inc. ("Lignum") owns the trademark to a group of cigarette brands (the Rave brands) which are currently manufactured outside the United States and then imported by Lignum for sale in the United States. Lignum also imports and sells in the United States other brands (the Sampoerna brands) which are owned and manufactured by a foreign manufacturer, PT Hanjaya Mandala Sampoerna Tbk ("Sampoerna") and/or it subsidiaries. In practice, Lignum has been the exclusive importer and first purchaser for resale in the United States of Sampoerna brands; Lignum hereby signs and executes the Master Settlement Agreement ("MSA").

In addition, notwithstanding sections II(jj) and II(uu) of the MSA, Sampoerna shall not be considered to be a Tobacco Product Manufacturer (and shall, for the purposes of the Model Statute set forth in Exhibit T to the MSA only, be considered to be a Participating Manufacturer) and Lignum shall have the rights specified in paragraph (4) below, in the event that:

(1) Lignum signs the MSA within 90 days after the MSA Execution Date and is bound by such Agreement in all Settling States in which such Agreement binds Original Participating Manufacturers;

(2) On or before March 31, 1999, Lignum enters into an agreement with Sampoerna (an "Exclusive Distribution Agreement"), such Exclusive Distribution Agreement remains in full force and effect, and both parties thereto fully perform their obligations thereunder. The Exclusive Distribution Agreement must contain the following terms:

(A) Sampoerna appoints Lignum as its exclusive importer and distributor for sale in the territory of any state of the United States the District of Columbia, the Commonwealth of Puerto Rico, Guam, the Virgin Islands, American Samoa and the Northern Marianas (the "Territory") of any and all Cigarettes which are and will be manufactured by Sampoerna or any licensee or Affiliate of Sampoerna under trademarks owned by Sampoerna and exported for intended sale in the Territory, subject to the terms and conditions appearing in the Exclusive Distribution Agreement (so long as such terms and conditions are not inconsistent with paragraphs (A) through (E)). The term "Affiliate" as used herein shall mean a person who directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or control with, another person. Solely for the purpose of this definition, the terms "owns," "is owned" and "ownership" mean ownership of an equity interest, or the equivalent thereof, of 50 percent or more, and the term "person" means an individual, partnership, committee, association, corporation or any other organization of group of persons.

(B) Sampoerna shall not appoint any person other than Lignum as an additional importer and distributor for sale of the Cigarettes within the Territory, nor shall Sampoerna sell or distribute the Cigarettes in the Territory except through Lignum or market or advertise the Cigarettes in the Territory.

(C) Sampoerna shall supply the Cigarettes, which shall comply with the requirements or applicable regulations effective in the Territory. Lignum shall obtain all the governmental certification, license, permit or approval necessary to import and distribute the Cigarettes in the Territory and shall sell the Cigarettes in the Territory in strict compliance with any and all laws, regulations and other requirements of federal, state, and local governments and their agencies. Lignum shall be responsible for the payments under the MSA with respect to the Cigarettes, shall pay the taxes specified in subsection II(z) of the MSA on the Cigarettes, and shall report the Cigarettes as its shipments in the manner prescribed in subsection II(mm) of the MSA.

(D) The Exclusive Distribution Agreement between Sampoerna and Lignum shall be effective on the date of execution of that agreement (which shall be on or before March 31, 1999) and shall not be terminated by either party to the Exclusive Distribution Agreement as long as the MSA remains in effect unless (a) Sampoerna has appointed another signatory to the MSA as importer for the Territory, or (b) Sampoerna ceases manufacturing and exporting Cigarettes for sale in the Territory, and Sampoerna does not manufacture and export Cigarettes for sale in the Territory.

1. The Settling States and the Original Participating Manufacturers are third-party beneficiaries of the Exclusive Distribution Agreement.

(3) Lignum does not, after the date Lignum becomes a signatory to the MSA, import, sell or distribute Cigarettes manufactured (or purchased for resale in the States) by a Non-Participating Manufacturer; and

(4) For purposes of sections IX(i) and IX(d)(1)(B) of the MSA, Lignum’s 1997 and 1998 Market Share: (A) shall not include Cigarettes manufactured (or purchased for resale in the States) by any Non-Participating Manufacturer; and (B) shall include the Market Share for 1997 and 1998, whichever is in question, of Sampoerna (but only so long as the conditions specified in paragraphs (1)-(3) above are met).

All capitalized terms not otherwise defined shall have the meaning given such terms in the MSA.

 

Dated: February 11, 1999
San Leandro, California

LIGNUM-2, INC.

By: /s/ Kenneth J. Irinaga
Kenneth J. Irinaga
President

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AMENDMENT NO. 9

TO THE MASTER SETTLEMENT AGREEMENT

WHEREAS, Top Tobacco, L.P. ("Top Tobacco") desires to execute the Master Settlement Agreement ("MSA") among the Settling States and certain Tobacco Product Manufacturers, and the Settling States and such Tobacco Product Manufacturers desire that Top Tobacco execute the MSA;

WHEREAS, the MSA contains provisions necessitating the determination of Top Tobacco’s 1997 and 1998 Market Share;

WHEREAS, Top Tobacco manufactures "roll your own" tobacco, on which federal excise taxes were not collected in 1997 or 1998 and will not be collected in 1999;

WHEREAS, Top Tobacco has audited records of its volume of sales of Tobacco Products during 1997 and 1998 only on the basis of fiscal years beginning on November 1 running through October 31 of the subsequent year;

IT IS THEREFORE AGREED THAT,

Top Tobacco hereby signs and executes the Master Settlement Agreement subject to the following:

(a) For purposes of section IX(i) of the MSA, the greater of (1) Top Tobacco’s 1998 Market Share or (2) 125 percent of Top Tobacco’s 1997 Market Share shall be Top Tobacco’s 1998 Market Share. Top Tobacco’s 1998 Market Share shall be determined by dividing (and expressing as a percentage): (1) 125 percent of the audited number of individual Cigarettes sold by Top Tobacco in the fifty United States, the District of Columbia and Puerto Rico during Top Tobacco’s fiscal year 1997 (i.e., November 1, 1997 through October 31, 1998); by (2) the total number of individual Cigarettes sold in the fifty United States, the District of Columbia and Puerto Rico during calendar year 1998, as measured in the manner described in section II(z) of the MSA. For purposes of these calculations, and pursuant to section II(z) of the MSA, 0.09 ounces of "roll your own" tobacco shall constitute one individual Cigarette. Top Tobacco hereby represents and warrants that 125 percent of the audited number of individual Cigarettes sold by Top Tobacco in the fifty United States, the District of Columbia and Puerto Rico during Top Tobacco’s fiscal year 1997 does not exceed the number of individual Cigarettes sold by Top Tobacco in the fifty United States, the District of Columbia and Puerto Rico during calendar year 1998 (based on the best available information).

(b) For purposes of section IX(d)(1) of the MSA, Top Tobacco’s 1997 Market Share shall be determined by dividing (and expressing as a percentage): (1) the audited number of individual Cigarettes sold by Top Tobacco in the fifty United States, the District of Columbia and Puerto Rico during Top Tobacco’s fiscal year 1997 (i.e., November 1, 1997 through October 31, 1998); by (2) the total number of individual Cigarettes sold in the fifty United States, the District of Columbia and Puerto Rico during calendar year 1997, as measured in the manner described in section II(z) of the MSA. For purposes of these calculations, and pursuant to section II(z) of the MSA, 0.0325 ounces of "roll your own" tobacco shall constitute one individual Cigarette.

(c) Top Tobacco represents and warrants that it will obtain audited records of its sales of Tobacco Products during calendar year 1999. Top Tobacco’s 1999 Market Share shall be determined by dividing (and expressing as a percentage): (1) the audited number of individual Cigarettes sold by Top Tobacco in the fifty United States, the District of Columbia and Puerto Rico during calendar year 1999; by (2) the total number of individual Cigarettes sold in the fifty United States, the District of Columbia and Puerto Rico during calendar year 1999, as measured in the manner described in section II(z) of the MSA. Pursuant to section II(z) of the MSA: 0.09 ounces of "roll your own" tobacco shall constitute one individual Cigarette when performing these calculations for purposes of section IX(j) of the MSA; and 0.0325 ounces of "roll your own" tobacco shall constitute one individual Cigarette when performing these calculations for purposes of section IX(d)(1) of the MSA.

(d) Pursuant to section II(z) of the MSA, bulk sales of tobacco by Top Tobacco to another Tobacco Product Manufacturer that is to be used by such other Tobacco Product Manufacturer in manufacturing Cigarettes intended for sale to consumers (whether directly or through a retailer, distributor or other intermediary or intermediaries) will not be included either: (1) in the audited number of individual Cigarettes sold by Top Tobacco in the fifty United States, the District of Columbia and Puerto Rico during Top Tobacco’s fiscal year 1997 (i.e., November 1, 1997 through October 31, 1998); or (2) in calculating Top Tobacco’s Market Share for any year.

All capitalized terms not otherwise defined have the meaning given such terms in the MSA.

Dated: New York, New York
February 10, 1999

TOP TOBACCO, L.P.

/s/ Seth I. Gold
By: Seth I. Gold, Executive V.P.

AMENDMENT NO. 10 TO MASTER SETTLEMENT AGREEMENT

1. Notwithstanding section II(ii) of the Master Settlement Agreement ("MSA"), the term Outdoor Advertising does not mean the current signs on the outside of Sherman’s 1400 Broadway N.Y.C. Ltd.’s and/or its Affiliates’ ("Sherman’s 1400") retail establishment at 42nd Street and 5th Avenue in New York City ("Nat Sherman’s Retail Establishment"), or any replacement signs outside Nat Sherman’s Retail Establishment in so far as they are of a similar nature, size, and wording.

2. Notwithstanding sections II(i) of the MSA, neither the phrase "Nat Sherman" nor the phrase "Nat Sherman Tobacconist to the World" (collectively "Nat Sherman") shall be considered a Brand Name; provided however:

a. Sherman’s 1400 does not manufacture, make, market, distribute, offer, sell, license, or import any brand of Cigarettes that use "Nat Sherman" to identify that specific brand of Cigarettes as its brand name; and

b. nothing in this paragraph shall create an exception to the prohibitions contained in section III (a) of the MSA; and

c. nothing in this paragraph shall allow Sherman’s 1400 to engage in Outdoor Advertising except as provided in paragraph 1 above.

3. If in the future Sherman’s 1400 is sold or transferred to a person or entity outside of the Sherman family, or the name "Nat Sherman" is licensed to a person or entity outside of the Sherman family, then paragraph 2 above shall be inapplicable unless the size of the name "Nat Sherman" contained on any Tobacco Product package is less than the size of any other print on the package, but in no event shall the size of the name "Nat Sherman" be in excess of 5/16th of an inch in height.

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AMENDMENT NO. 11 TO MASTER SETTLEMENT AGREEMENT

King Maker Marketing, Inc., ("King Maker") hereby signs and executes the Master Settlement Agreement (AMSA@).

In addition, notwithstanding sections II(jj) and II(uu) of the MSA, King Maker shall have the rights specified in paragraph (4) below and ITC Limited, India ("ITC") shall not be considered to be a Tobacco Product Manufacturer (and ITC shall, for the purposes of the Model Statute set forth in Exhibit T to the MSA only, be considered to be a Participating Manufacturer), provided that:

(1) King Maker signs the MSA within 90 days after the MSA Execution Date and is bound by such Agreement in all Settling States in which such Agreement binds Original Participating Manufacturers;

(2) On or before March 31, 1999, King Maker enters into an agreement (an "Exclusive Distribution Agreement") with ITC, such Exclusive Distribution Agreement remains in full force and effect, and both parties to the Exclusive Distribution Agreement fully perform their obligations thereunder. The Exclusive Distribution Agreement must contain the following terms:

(A) ITC appoints King Maker as its exclusive importer and distributor for sale in the territory of any state of the United States, the District of Columbia, the Commonwealth of Puerto Rico, Guam, the Virgin Islands, American Samoa and the Northern Marianas (the "Territory") of any and all Cigarettes which are and will be manufactured by ITC or any licensee or Affiliate of ITC under trademarks owned by ITC and exported for intended sale in the Territory, subject to the terms and conditions appearing in the Exclusive Distribution Agreement (insofar as such terms and conditions are not inconsistent with paragraphs (A) through (E)). The term "Affiliate" as used herein shall mean a person who directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or control with, another person. Solely for the purpose of this definition, the terms "owns," "is owned" and "ownership" mean ownership of an equity interest, or the equivalent thereof, of 50 percent or more, and the term "person" means an individual, partnership, committee, association, corporation or any other organization of group of persons.

(B) ITC shall not appoint any person other than King Maker as an additional importer and distributor for sale of the Cigarettes within the Territory, nor shall ITC sell or distribute the Cigarettes in the Territory except through King Maker or market or advertise the Cigarettes in the Territory except through King Maker.

(C) ITC shall supply the Cigarettes, which shall comply with the requirements or applicable regulations effective in the Territory. King Maker shall obtain all the governmental certification, license, permit or approval necessary to import and distribute the Cigarettes in the Territory and shall sell the Cigarettes in the Territory in strict compliance with any and all laws, regulations and other requirements of federal, state, and local governments and their agencies. King Maker shall be responsible for the payments under the MSA with respect to the Cigarettes, shall pay the taxes specified in subsection II(z) of the MSA on the Cigarettes, and shall report the Cigarettes as its shipments in the manner prescribed in subsection II(mm) of the MSA.

(D) The Exclusive Distribution Agreement between ITC and King Maker shall be effective on the date of execution of that agreement (which shall be on or before March 31, 1999) and shall not be terminated by either party to that agreement as long as the MSA remains in effect unless (a) ITC has appointed another signatory to the MSA as importer for the Territory or (b) ITC ceases manufacturing and exporting Cigarettes bearing trademarks owned by ITC for sale in the Territory, and ITC does not manufacture and export Cigarettes bearing trademarks owned by ITC for sale in the Territory.

(E) The Settling States and the Original Participating Manufacturers are third-party beneficiaries of those provisions of the Exclusive Distribution Agreement relating to the MSA.

(3) King Maker does not, after the date King Maker becomes a signatory to the MSA, import, sell or distribute Cigarettes manufactured (or purchased for resale in the States) by a Non-Participating Manufacturer; and

(4) For purposes of sections IX(i) and IX(d)(1)(B) of the MSA, King Maker’s 1997 and 1998 Market Share: (A) shall not include Cigarettes manufactured (or purchased for resale in the States) by any Non-Participating Manufacturer; and (B) shall include the Market Share for 1997 and 1998, whichever is in question, of ITC, if any, with respect to brands of Cigarettes as to which King Maker has exclusive import and distribution rights in the States with respect to the entire calendar year immediately preceding the year in which the calculation in question is being made (but only so long as the conditions specified in paragraphs (1)-(3) above for ITC are met).

All capitalized terms not otherwise defined shall have the meaning given such terms in the MSA

 

Dated: February 11, 1999
New York, N.Y.

KING MAKER MARKETING, INC.

By: /s/ Mark Finkle
Mark Finkle
President

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AMENDMENT NO. 12 TO THE MASTER SETTLEMENT AGREEMENT

Section 5 of Exhibit U of the Master Settlement Agreement is hereby amended to read as follows:

Section 5

Within 45 days after receiving the itemized requests for funds from the Settling States, the Allocation Committee will prepare a preliminary decision allocating the Strategic Contribution Fund payments among the Settling States that submitted itemized requests for funds. All Allocation Committee decisions must be by majority vote. Each Settling State will have 45 days to submit comments on or objections to the draft decision. The Allocation Committee will issue a final decision allocating the Strategic Contribution Fund payments within 30 days. [end page]*

 

SIGNATURES OF THE SETTLING STATES
WERE AUTHORIZED BY THE ATTORNEYS
GENERAL AND AFFIXED BY NAAG WITH
RESPECT TO AMENDMENTS 12 AND 13
TOGETHER. SIGNATURES FOLLOW
AMENDMENT 13.

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This page last updated on 5-oct-01