tag:blogger.com,1999:blog-88124984770035832622024-02-20T15:44:10.725-08:00SettlementSettlementhttp://www.blogger.com/profile/07780234485860161985noreply@blogger.comBlogger7125tag:blogger.com,1999:blog-8812498477003583262.post-45761038344230155272007-10-24T07:00:00.000-07:002007-10-24T07:05:20.219-07:00LIGGETT SETTLEMENT WITH 5 INITIAL SETTLING STATESATTORNEYS GENERAL<br />SETTLEMENT AGREEMENT<br />WITH BROOKE GROUP LTD. and<br />LIGGETT GROUP, INC.<br />March 15, 1996<br />This SETTLEMENT AGREEMENT is entered into this 15th day of March, 1996 by and among the State of West Virginia, State of Florida, State of Mississippi, Commonwealth of Massachusetts, and State of Louisiana (collectively, "Plaintiffs"), and Brooke Group Ltd. ("Brooke Group"), a Delaware corporation, and Liggett Group, Inc. ("Liggett"), a Delaware corporation.<br />RECITALS<br />WHEREAS,<br />A On or about May 23, 1994, the State of Mississippi, by and through its Attorney General, Mike Moore, brought an action entitled Moore v. The American Tobacco Co. et al., CN 94-1429, Chancery Court of Jackson County, Mississippi, against, among others, the American Tobacco Company, Inc., R.J. Reynolds Tobacco Company, Brown & Williamson Tobacco Corporation, Philip Morris, Inc., Liggett & Myers, Inc., Lorillard Tobacco Company, Inc. and United States Tobacco Company and their various parent and related companies ("Defendants"), asserting claims for, among other things, expenses allegedly arising from tobacco-related matters and injunctive relief concerning sales of cigarettes to minors (the "Mississippi Action").<br />B. On or about September 20, 1994, the State of West Virginia, by and through its Attorney General Darrell V. McGraw, Jr., brought an action entitled McGraw v. The American Tobacco Co. et al., 94-C-1707, Circuit Court of Kanawha County, West Virginia, against, among others, the Defendants asserting similar claims (the "West Virginia Action").<br />C. On or about February 21, 1995, the State of Florida, by and through its Attorney General Robert Butterworth, brought an action entitled The State of Florida, Lawton M. Chiles, Jr., Individually and as Governor of the State of Florida, Department of Business and Professional Regulation, and the Agency for Health Care Administration v. The American Tobacco Co. et al., CN 95-1466, Fifteenth Judicial Circuit, Palm Beach County, Florida, against, among others, the Defendants asserting similar claims (the "Florida Action").<br />D. On or about December 19, 1995, the Commonwealth of Massachusetts, by and through its Attorney General Scott Harshbarger, brought an action entitled Commonwealth of Massachusetts v. Philip Morris, Inc. et al., Civil No. 95-7378, Massachusetts Superior Court, against, among others, the Defendants asserting similar claims (the "Massachusetts Action").<br />E. On or about March 13, 1995, the State of Louisiana, by and through its Attorney General Richard P. Ieyoub, brought an action entitled Richard P. Ieyoub, Attorney General ex rel., State of Louisiana v. The American Tobacco Company, et al., Civil No. 96-1209, 14th Judicial District Court, Parish of Caleasieu, State of Louisiana, against, among others, the Defendants asserting similar claims (the "Louisiana Action").<br />F. Other States are reportedly planning to bring or are considering bringing actions similar to the above-mentioned actions.<br />G. On or about March 12, 1996, Brooke Group, Liggett and the plaintiffs in an action entitled Dianne Castano et al. v. The American Tobacco Company, Inc. et al., Civil No. 94-1044, United States District Court for the Eastern District of Louisiana ("Castano"), entered into a national class settlement, subject to, among other things, court approval, with respect to a putative class of allegedly nicotine-dependent smokers and their families.<br />H. Brooke Group and Liggett have denied, and continue to deny, each and all of the claims and contentions alleged by the plaintiffs in each and all of the above-mentioned actions, and have denied, and continue to deny, any wrongdoing or legal liability of any kind.<br />I. Plaintiffs and Brooke Group and Liggett recognize and support the public interest in preventing smoking by, or promotion of smoking to, children and adolescents.<br />J. The Food and Drug Administration ("FDA") has proposed certain new regulations purportedly concerning the sale and distribution of nicotine-containing cigarettes and smokeless tobacco products to children and adolescents.<br />K. Brooke Group and Liggett recognize and acknowledge that defending the continued prosecution of Castano (or a similar putative class action) against them through trial and appeals would require considerable resources and expense and would entail uncertainty and risk. Brooke Group and Liggett have determined that the settlement, in accordance with this Agreement, of the claims in Castano against them will be beneficial to Brooke Group and Liggett.<br />L. The Settling States and the Attorneys General recognize and acknowledge that the continued prosecution of the Attorneys General Actions against Brooke Group and Liggett through trial and appeals would require considerable time and expense and would entail uncertainty, risk and delay. The Settling States and the Attorneys General have determined that the settlement, in accordance with this Agreement, of the claims in Attorneys General have determined that the settlement, in accordance with this Agreement, of the claims in the Attorney General Actions against Brooke Group and Liggett will be beneficial to their respective States.<br />NOW, THEREFORE, in consideration of the foregoing and of the promises and covenants set forth in this Agreement, the undersigned Attorneys General, on their own behalf and on behalf of their respective States, and Brooke Group and Liggett hereby stipulate and agree that the Attorney General Actions shall be settled as against Brooke Group, Liggett and upon such Future Affiliate becoming bound by this Agreement, a Future Affiliate (as defined hereinbelow) of Liggett or Brooke Group and that all claims asserted in the Attorney General Actions against Brooke Group, Liggett and such Future Affiliate shall be dismissed, all on the terms contained herein, as follows:<br />1. Definitions.<br />As used in and solely for the purposes of this Agreement, the following terms shall have the following respective meanings:<br />"Affiliate" means a Present Affiliate or a Future Affiliate.<br />"Agreement" means this Settlement Agreement.<br />"Attorney General Actions" means the Mississippi Action, the West Virginia Action, the Florida Action, the Massachusetts Action, and the Louisiana Action or any similar action commenced by or on behalf of the other States against the Defendants.<br />"Attorney General Settlement Fund" means the fund established as provided in Section 5 of this Agreement.<br />"Attorney General Settlement Fund Board" or "Attorney General Board" and "Attorney General Board Document" mean, respectively, the entity to be established as provided in Section 5 of this Agreement and the document or documents that the Attorneys General of the Settling States shall enter into by which the Attorneys General of the Settling States, or their respective urban consumers issued by the Bureau of Labor Statistics of the U.S. Department of Labor increases or decreases for the relevant period. The beginning index figure shall be the consumer price index for March 1996.<br />"Initial Settling States" means the States of Mississippi, West Virginia, Florida, the Commonwealth of Massachusetts, Louisiana, and the respective Attorneys General thereof.<br />"Liggett" means Liggett Group, Inc., and Liggett & Myers, Inc.<br />"Market Share" means, with respect to a Defendant and a specified year, the domestic market share in that year of all such Defendant's tobacco products, as determined by The Maxwell Consumer Report published by Wheat First Butcher Singer or a comparable successor report.<br />"Medicaid Population" means, with respect to a Settling State and a specified date, the Medicaid population of such Settling State as reported by the most recent United States Census.<br />"Non-settling Defendant" means each of the American Tobacco Co., Lorillard Tobacco Company., Philip Morris Inc., R.J. Reynolds Tobacco Company, Brown & Williamson Tobacco Corp., and United States Tobacco Co., unless and until it becomes a Settling Defendant, as hereinafter defined.<br />"Parties" means the Plaintiffs, Brooke Group, Liggett and any other Settling Defendant, as hereinafter defined, if, as and when it becomes bound by this Agreement.<br />"Present Affiliate" means, with respect to a specified corporation, another corporation, partnership or other entity which as of the date of this Agreement, directly or indirectly, controls, is controlled by, or is under common control with, such specified corporation.<br />"Present Value" means, with respect to a specified amount or amounts, the present value of such amount or amounts as calculated using a discount rate equal to the yield on 10-year Treasury Notes as reported in the Wall Street Journal at the time of such calculation.<br />"Pretax Income," with respect to a specified Settling Defendant other than Liggett, means, for a specified year, the operating income (or equivalent designation) from Domestic Tobacco Operations of the Settling Defendant and its Present Affiliates, on a consolidated basis, for the Settling Defendant's most recent fiscal year, as reported in filings to the United States Securities and Exchange Commission or, if there is no such filing, as reported by the Settling Defendant's independent outside auditors. For purposes of the consolidation intended hereby, interest expenses on parent company debt and parent company corporate and other expenses, less amortization of parent company acquisition goodwill, shall be allocated pro rata to all operating units according to operating income. If GAAP changes in any material respect during the term of this Agreement so that the benefits anticipated by the parties (in light of GAAP applicable on the date of this Agreement), an appropriate adjustment shall be made to the formulas and calculations hereunder to achieve the parties' expectations as of the date hereof.<br />"Pretax Income," with respect to Liggett, means for a specified year, the "Income before Income Taxes" as determined in accordance with generally accepted accounting principles (:GAAP") of Liggett for its most recent fiscal year, as reported in filings to the United Securities and Exchange Commission or, if there is no such filing, as reported by Liggett's independent outside auditors. If GAAP changes in any material respect during the term of this Agreement so that the benefits anticipated by the parties (in light of GAAP applicable on the date of this Agreement), an appropriate adjustment shall be made to the formulas and calculations hereunder to achieve the parties' expectations as of the date hereof.<br />"Proposed Rule" means the regulations proposed by the FDA concerning the sale and distribution of cigarettes and other products, dated August 9, 1995, published at 21 C.F.R. Parts 801, 803, 804 and 897, and bearing document number 95N-0253.<br />"Settling Defendants" means Brooke Group, Liggett and, if, as, and when it joins in this Agreement, one Future Affiliate; provided that in the event of any corporate restructuring, reorganization or spinoff involving any Settling Defendant, only the entity or entities which, after such reorganization or spinoff, retains the Domestic Tobacco Operations of such Settling Defendant shall thereafter be treated as the Settling Defendant for purposes of the payment obligations of Section 6 of this Agreement.<br />"Settling Defendants' Counsel" means the law firm of Kasowitz, Benson, Torres & Friedman L.L.P.<br />"Settling States" means the Initial Settling States and Subsequent Settling States, if any.<br />"Smoking Claims Expense" means, with respect to a specified year, the aggregate amount of the out-of-pocket expenses paid during that year by a Settling Defendant for the payment of legal fees and costs, including attorneys' fees and any settlements (other than payments made pursuant to the Castano settlement) or judgments, in connection with litigation arising from smoking-related claims other than the Attorney General Actions, (or other civil cases filed on or before January 1, 1996).<br />"Subsequent Settling States" means States other than the Initial Settling States which commence an Attorney General Action and which become bound by this Agreement pursuant to Section 3.1 hereof prior to six months from the date of this Agreement (unless such six-month period is extended or reopened at the option of the Settling Defendants).<br />2. Settlement Purposes Only.<br />2.1. This Agreement is for settlement purposes only, and neither the fact of, or any provision contained in this Agreement nor any action taken hereunder shall constitute, be construed as, or be admissible in evidence as, any admission of the validity of any claim, any argument or any fact alleged or which could have been alleged by Plaintiffs as to their standing or as to any jurisdictional, constitutional or any other legal or factual issue in any Attorney General Action or alleged or which could have been alleged in any other action or proceeding of any kind or of any wrongdoing, fault, violation of law, or liability of any kind on the part of any of the Settling Defendants or any admission by any of them of any claim or allegation made or which could have been made in any Attorney General Action or in any other action or proceeding of any kind, or as an admission by any of the Plaintiffs of the validity of any fact or defense asserted against them in any Attorney General Action or in any other action or proceeding of any kind.<br />2.2. Nothing contained in this Agreement shall constitute or be construed as any admission of the validity of the FDA's assertion of jurisdiction over cigarettes or any other product.<br />3. Parties.<br />3.1. This Agreement shall be binding, in accordance with the terms hereof, upon Brooke Group, Liggett and the Future Affiliate and the Initial Settling States and each Subsequent Settling State upon its execution of a copy of this Agreement; provided that the payment obligations of this Agreement shall be binding only upon the Affiliates of such Settling Defendants which are engaged in Domestic Tobacco Operations.<br />3.2 The Settling States shall not seek to enjoin a spinoff or like disposition of the stock of Nabisco Holdings, Inc. by RJR Nabisco Holdings Corp. in the event that a slate of nominees proposed by Brooke Group for election to the RJR Nabisco Holdings Corp. Board of Directors is elected.<br />4. Advertising Limitations.<br />4.1. Each Settling Defendant, promptly after the later of the Settlement Date and the date said Settling Defendant becomes bound by this Agreement, shall (i) withdraw its objections and opposition to the Proposed Rule and to the assertion of jurisdiction by the FDA for the sole purpose of promulgating the Proposed Rule with respect to all Defendants; (ii) file pleadings or other documents necessary to effectuate such withdrawal; and (ii) withdraw as a party from litigation against state officials in the Settling States related to the tobacco litigation. By withdrawing said opposition and objections, Settling Defendants do not and shall not be deemed to consent to or acknowledge such jurisdiction and do not and shall not be deemed to waive or abandon said opposition and objections in the event this Agreement is terminated. Each Settling Defendant, notwithstanding the foregoing, may object to or oppose the Proposed Rule to the extent that compliance is impractical or excessively expensive. If, prior to the Proposed Rule taking final nonappealable effect as to the tobacco industry generally, the FDA asserts that it has acquired or can or should acquire jurisdiction to promulgate or enforce the Proposed Rule as to a Settling Defendant by virtue of its entry into or compliance with this Agreement, then, in such event, this Section 4 and its subparts shall be null and void ab initio in their entirety.<br />4.2. Each Settling Defendant shall follow and abide by the provisions of the Proposed Rule, insofar as they pertain solely to such Settling Defendant's Domestic Tobacco Operations, as set forth in, and modified by, paragraphs 4.2.1 to 4.2.9 hereof until a final determination is reached respecting the Proposed Rule, at which time the Settling Defendants will be bound by the Rule only insofar as, and to the extent that, the Rule becomes an enforceable obligation binding upon all of the Settling Defendants and non-settling Defendants.<br />4.2.1. Proposed Rule § 897.16(a), but only to the extent that such section applies to a trade or brand name of a non-tobacco product which is in use in the United States and has a demonstrated or likely appeal to minors; provided that in any dispute hereunder, the Settling Defendant shall have the burden to show compliance with this Subsection in binding arbitration.<br />4.2.2. Proposed Rule § 897.16 (b), as proposed.<br />4.2.3. Proposed Rule § 897.16 (d), except to the extent free samples are distributed under circumstances where no minors are present or likely to be present.<br />4.2.4. Proposed Rule § 897.30 (a), as proposed.<br />4.2.5. Proposed Rule § 897.30 (b), but only to the extent that such section applies to billboards within 1,000 feet of a clearly marked and state-licensed elementary or secondary school or a clearly marked, outdoor, municipal or other government-operated public playground for children.<br />4.2.6. Proposed Rule § 897.32 (a), except that the requirements of such section will be applicable only to a publication whose regular readers aged less than eighteen years constitute 15% or more of the publication's total regular readership; provided that for those publications in which the Settling Defendants currently advertise which exceed the 15% limitation, Settling Defendants will, through incremental reduction, meet the requirements of this section within a period of five ( 5) years.<br />4.2.7. Proposed Rule § 897.34 (a), to the extent such section applies to clothing or outerwear or to any items or services, other than clothing or outerwear, which have not prior to the date of this Agreement been marketed, licensed, distributed or sold, and which are more likely to appeal to minors than to adults; provided that such section does not apply to any clothing, outerwear, items or services customarily marketed, licensed, distributed or sold at the site and at the time of events permissible under section 4.2.9 of this Agreement.<br />4.2.8. Proposed Rule § 897.34(b), to the extent that gifts or items distributable or redeemable pursuant to this rule are more likely to appeal to minors than to adults.<br />4.2.9. Proposed Rule § 897.34(c), except that such section will be applicable only to an athletic, musical, artistic or other social or cultural event whose past patrons or attendees aged less than eighteen years constitute 15% or more of the event's total past patronage or attendance; provided that this section does not apply to any events that Settling Defendants have sponsored, conducted, engaged or participated in within the last ten years.<br />4.3. Notwithstanding anything to the contrary in the Proposed Rule or in this Agreement, each such Settling Defendant will commence compliance with Section 4.2 of this Agreement, according priority as to compliance to the Initial Settling States and then to Subsequently Settling States as soon as reasonably practicable; provided that such Settling Defendant may limit its compliance to the extent, if any, necessary to ensure that the net annual out-of-pocket cost to the Settling Defendant of such compliance not exceed $1 million; and provided further that such Settling Defendant shall not be obl-igated pursuant hereto to breach pre-existing legal obligations, if any, it may have with respect to the matters covered by Section 4.2 (and shall use its reasonable best efforts to minimize the degree to which any such obligations would impede its full compliance therewith). For purposes of this paragraph, the phrase "net annual out-of-pocket cost" means the excess of (a) the additional out-of-pocket expenditures incurred during a particular year by a particular Settling Defendant in complying with the matters specified in Section 4.2, over (b) savings, if any, in out-of-pocket expenditures realized during such year by such Settling Defendant directly from the implementation of the matters covered by Section 4.2.<br />4.4. If, when and to the extent that the Proposed Rule, in whole or in part, becomes an enforceable legal obligation binding upon all of the Defendants, each Settling Defendant will comply therewith.<br />4.5. As promptly as reasonably practicable after becoming bound by this Agreement, each Settling Defendant shall eliminate cartoon characters, such as "Joe Camel", from all of its advertising and promotional materials and activities with respect to tobacco products.<br />4.6 Each Settling Defendant other than Brooke Group and Liggett shall contribute to a fund to be administered by the Attorneys General of the Settling States, the amount of $250,000 per year, per Initial Settling State, for a period of three years from the date such Settling Defendant becomes bound by this Agreement for the purposes of monitoring the point-of-sale advertising amounts, types, locations, and proximity to schools, in the Initial Settling States.<br />5. Attorney General Settlement Fund<br />5.1 All amounts due and owing by Settling Defendants under this Agreement shall be paid when due into the Attorney General Settlement Fund to be administered, allocated and distributed by the Attorney General Board to Settling States in accordance with this Agreement and the Attorney General Board Document; it being understood that payments shall be first applied by each Settling States to compensate state health care programs bearing the greatest percentage of state taxpayer contribution.<br />5.2 Settling Defendants shall have no interest in or responsibility for allocations or distributions from the Attorney General Settlement Fund and do not guarantee any earnings or insure against any losses from any portion of the Attorney General Settlement Fund assets that may be maintained or administered as provided in Section 5.1 above.<br />5.3 Liggett shall pay into the Attorney General Settlement Fund (a) for the benefit of the Initial Settling States, an initial amount equal to five million dollars ($5,000,000), of which one million dollars ($1,000,000) shall be payable within five business days of the date of this Agreement and the remaining four million dollars ($4,000,000) shall be paid in equal annual installments, indexed and adjusted for Inflation, over the following nine years during the term of this Agreement (except that any then remaining unpaid amount under this Section 5.3 (a) shall be due and payable within sixty (60) days of the date (i) a Future Affiliate becomes bound by this Agreement or (ii) Liggett defaults on any of its payment obligations under this Agreement) and (b) in each year beginning in the second year during the term of this Agreement (i) for the benefit of the Initial Settling States, an annual amount equal to 2.5% of Liggett's Pretax Income and (ii) for the benefit of each Subsequent Settling State, if any, an annual amount equal to the product of (A) the ratio that the Medicaid Population of such Subsequent Settling State then bears to a total Medicaid Population of ten million (10,000,000) reduced by the Medicaid Population of the Initial Settling States and (B) 5% of Liggett's Pretax Income; provided, however, that in no event shall the aggregate amount to be paid under clause (b)(ii) of this Section 5.3 ever exceed 5% of Liggett's Pretax Income. The Attorney General Board shall make all decisions regarding payments to the Settling States hereunder.<br />5.4. The Future Affiliate shall, within sixty (60) days of the date such Settling Defendant becomes bound by this Agreement, (a) pay into the Attorney General Settlement Fund, for the benefit of the Initial Settling States, an aggregate amount equal to one hundred thirty five million dollars ($135,000,000), and (b) make available an amount up to twenty five million dollars ($25,000,000) to be paid at the direction of the Attorneys General Board to Subsequent Settling States in connection with their joining this Agreement.<br />5.5 The Future Affiliate shall, commencing one year after the date such Settling Defendant becomes bound by this Agreement and on each anniversary of such date during the term of this Agreement, pay into the Attorney General Settlement Fund (a) for the benefit of the Initial Settling States, an amount equal to 2.5% of such Settling Defendant's Pretax Income, provided that the amounts payable under this Section 5.5(a) shall not be less than thirty million dollars ($30,000,000) per year (except as otherwise provided herein), indexed and adjusted for Inflation, and (b) for the benefit of each Subsequent Settling State, if any, an annual amount equal to the product of (i) the ratio that the Medicaid Population of such Subsequent Settling State then bears to a total Medicaid Population of ten million ($10,000,000) reduced by the Medicaid Population of the Initial Settling States and (ii) 5% of the Settling Defendant's Pretax Income; provided, however, that in no event shall the aggregate amount to be paid under clause (b)(ii) of this Section 5.5 ever exceed 5% of Liggett's Pretax Income in the aggregate.<br />5.6 With respect to each Settling State, in the event of the entry of any final non-appealable monetary judgment in such Settling State's Attorney General Action (other than by way of settlement) against any one or more of the Non-Settling Defendants, then each Settling Defendant shall have the right to reduce the payments it is obligated to make pursuant to this Agreement to the extent necessary to make (i) the then Present Value of all amounts theretofore paid and thereafter payable to that Settling State pursuant to this Agreement by any Settling Defendant per percentage point of the then Market Share of such Settling Defendant no more than seventy-five percent (75%) of (ii) the then Present Value of the dollar amount of such judgment per percentage point of the then Market Share of each such Non-Settling Defendant; provided that such Settling Defendant give written notice of such reduction and the method of calculating such reduction to the Settling State's Attorney General as soon as practicable after the entry of judgment; and provided further that to the extent any such reduction would reduce the Settling Defendant's annual payment to less than $30 million, indexed and increased for Inflation such Settling Defendant shall have the right to reduce payments it is obligated to make under this Agreement only to the extent necessary to make the quotients in Sections 5.6(i) and (ii) equal.<br />For purposes of this Section 5.6, computations based on future payments due any of the Initial Settling States shall be based on the minimum payments in Sections 5.3 and 5.5, indexed and increased for inflation at 5% per annum (computations based on future payments due any Subsequent Settling States shall assume, solely for this purpose, that each such state would be entitled to a payment proportional to the total minimum payments due the Initial States (as so indexed and increased above), adjusted solely for relative size of Medicaid Population.<br />5.7. Each Settling Defendant shall, during the term of this Agreement, have the right to a credit against amounts due in each year pursuant to this Agreement in an amount equal to fifty percent (50%) of the difference between (a) such Settling Defendant's Smoking Claims Expense in the prior year and (b) such Settling Defendant s Smoking Claims Expense for the twelve months prior to the date of this Agreement; provided that the amount of such credit shall not be greater than ten percent of the amounts that would otherwise be due from such Settling Defendant in such year; provided further that each Settling Defendant shall have the right to terminate this Agreement with respect to that Settling Defendant in the event that the amount of such difference is greater than twenty-five percent (25%) of the amount so due from such Settling Defendant in such year; and provided further that such credit shall not apply to the extent that it would render the amounts payable under Section 5.5 less than thirty million dollars ($30,000,000) per year.<br />5.8. With respect to each Settling Defendant, in each year beginning with the second year such Settling Defendant becomes bound by this Agreement, the annual payment amount due under Sections 5.3 and 5.5 of this Agreement from such Settling Defendant shall be decreased in proportion to any decrease, and (only if there shall have been a prior such decrease) increased in proportion to any increase, in such Settling Defendant's Market Share from the prior year; provided, however, that (a) such annual payment amount shall not be so decreased to the extent, if any, that such annual payment amount in such year is decreased as a result of a decrease in such Settling Defendant's Pretax Income and (b) such annual payment amount shall never be increased such that the aggregate amount of any such increases exceeds the aggregate amount of any such decreases (and in no event more than the maximum amount set forth in Sections 5.3, 5.4 and 5.5 hereof).<br />5.9. Insofar as the Castano Settlement Agreement is terminated (and no settlement contemplated by Section 11.2 thereof is entered into in any putative class action subsequent to Castano), the Castano CTCIR research fund contemplated by Section 6.4(b) of the Castano Settlement Agreement shall be administered by the Attorney General Board. At the time a Future Affiliate or other entity becomes bound by this Agreement and the Castano Settlement Agreement to the extent the CTCIR Research Fund is not funded under the Castano Settlement Agreement, that $10 million shall be paid into the Attorney General Settlement Fund and used for the same or similar purposes set forth in the Castano Settlement Agreement. If at any time under the terms of the Castano Settlement Agreement the funds with regard to the CTCIR Research Fund are due and payable, all future funds shall be paid under the Castano Settlement Agreement. But if a lapse in the obligation occurs under Castano, the funds shall be paid under this Agreement.<br />5.10. If the Brooke Group or Liggett fails to consummate a merger or other transaction with a Non-Settling Defendant which results in the creation or acquisition of a Future Affiliate within three years of the date of the execution of this Agreement, Liggett shall pay into the Attorney General Settlement Fund $5 million for distribution to each of the Initial Settling States on an equal share basis.<br />5.11. No Non-Settling Defendant may become a future Affiliate if after the date of this Agreement that Non-Settling Defendant has by spinoff, sale, or other transaction substantially changed its Domestic Tobacco Operations so as to result in a material reduction in Market Share caused by such voluntary corporate action. No Settling Defendant shall sell, dispose or transfer any of its cigarette brands or business without first causing the acquiror, on behalf of itself and its successors, to be bound by all of the obligations of a Settling Defendant hereunder as to such transferred brand or business. <br /><br /><br /><SPAN style="DISPLAY: none"><br />Anahtar kelimeler<br />act settlement<br />case settlement<br />money settlement<br />selling settlement<br />settlement cases<br />settlement court<br />settlement law<br />settlement lawsuit<br />settlement litigation<br />tax settlement<br />taxes settlement<br />tobacco settlement<br />virginia settlement<br />against settlement<br />canadian settlement<br />cigarette settlement<br />government settlement<br />history of settlement<br />kentucky settlement<br />lawsuits settlement<br />liggett cigarette<br />liggett cigarettes<br />liggett company<br />liggett tobacco<br />market settlement<br />minors settlement<br />policy settlement<br />revenue settlement<br />settlement judge<br />settlement laws<br />smoking settlement<br />tabacco settlement<br />imperial settlement<br />liggett lawsuit<br />tobaco settlement<br />tobbaco settlement<br /><br />Anahtar kelimeler<br />hulya avsar sex<br />hulya sex<br />hülya avşar sex<br />hülya sex<br />hulya avsar sex com<br />hulya avsar sex filmi<br />hulya avsar sex video<br />hulya kocyigit sex<br />hulya kocyigit sex video<br />hülya avsar sex<br />hülya avşarın sex<br />hülya kocyigit sex<br />hülya koçyiğit sex<br />hulya avsar sex filimi<br />hulya avsar sex filimleri<br />hulya avsar sex films<br />hulya avsar sex tape<br /><br />Anahtar kelimeler<br />gulben ergen sex<br />gulben sex<br />gülben ergen sex<br />gülben sex<br />gulben ergen sex filmi<br />gulben ergen sex kaseti<br />gulben ergen sex tape<br />gulben ergen sex video<br />gulben ergen sex videosu<br />gülben ergen sex tape<br />gülben ergen sex video<br />gülben ergenin sex<br />gulben ergen sex videos<br />gulben ergenin sex filmi<br />Anahtar kelimeler<br />animals sex<br />sex animal<br />anal sex animal<br />dog sex animal<br />female sex animal<br />girl sex animal<br />hard sex animal<br />hardcore sex animal<br />having sex with animal<br />human sex animal<br />man sex animal<br />mature sex animal<br />sex animal cartoon<br />sex animal clip<br />sex animal clips<br />sex animal farm<br />sex animal fuck<br />sex animal girls<br />sex animal horse<br />sex animal lovers<br />sex animal movies<br />sex animal pic<br />sex animal stories<br />sex animal teen<br />sex porn animal<br />sexanimal<br />sexanimal com<br />story sex animal<br />woman sex animal<br />women sex animal<br />www sexanimal<br />www sexanimal com<br />xxx sex animal<br />animal sexanimal<br />asian sex animal<br />sex animal brazil<br />sex animal mpeg<br />sex animal pig<br />sex animal pussy<br />sex beast animal<br />sexanimal movie<br />sexanimal sex<br />sexanimal video<br />teens sex animal<br />young sex animal<br />sexanimal frri<br />sexanimal images<br />www sexanimal com brl<br /><br /><br /><br /><br /><br /></span>Settlementhttp://www.blogger.com/profile/07780234485860161985noreply@blogger.com0tag:blogger.com,1999:blog-8812498477003583262.post-73820908233944866392007-10-24T06:56:00.000-07:002007-10-24T07:00:06.638-07:00ADDENDUM TO INITIAL STATES SETTLEMENT AGREEMENTADDENDUM TO INITIAL STATES SETTLEMENT AGREEMENT <a name="E7E1"></a><br />This ADDENDUM TO INITIAL STATES SETTLEMENT AGREEMENT is entered into this ____ day of March, 1997 by and among the State of West Virginia, State of Florida, State of Mississippi, Commonwealth of Massachusetts, and State of Louisiana (collectively, "Initial States") and Brooke Group Ltd., a Delaware corporation ("Brooke Group), Liggett & Myers, Inc., a Delaware corporation ("Myers), and Liggett Group, Inc., a Delaware corporation (which with Myers, is hereinafter referred to as "Liggett). <a name="E7E1"></a><br />WHEREAS, <a name="E7E1"></a><br />A. On March 15, 1996, the State of West Virginia, the State of Florida, the State of Mississippi, the Commonwealth of Massachusetts, and the State of Louisiana, and Liggett and Brooke Group entered into a settlement (the "Initial Settlement") of the Actions brought by the foregoing States, pursuant to which Liggett agreed to make certain payments, comply with certain proposed regulations restriction the marketing and sale of cigarettes to minors and to offer certain cooperation in connection with the prosecution of such Actions against other Defendants, all in accordance with the terms of the Initial Settlement, a copy of which is annexed hereto as Appendix A. <a name="E7E1"></a><br />B. On March 20th, 1997, eighteen States and Liggett and Brooke Group entered into a settlement (the "New Settlement") of the Actions brought by such eighteen states, pursuant to which Liggett agreed, among other things, to extend additional cooperation in connection with the prosecution of Attorneys General Actions against other Defendants than Liggett agreed to in the Initial Settlement and such other States agreed to exercise best efforts to ensure that the financial terms of any Global Settlement, legislative or otherwise, are no more onerous on, or less favorable to Brooke Group and Liggett than those set forth in the New Agreement, a copy of which is annexed hereto ass Appendix B. <a name="E7E1"></a><br />C. The Initial Settling States and Liggett and Brooke Group wish to expand upon the Initial Settlement, through this Addendum to Settlement Agreement to provide for additional cooperation by the Settling Defendants with the Initial Settling States, and to provide Settling Defendants with assurances that the Initial Settling States will seek to ensure that any Global Settlement provide for financial terms for Liggett that reflect appropriate recognition of Liggett’s cooperative efforts. <a name="E7E1"></a><br />NOW THEREFORE, in consideration of the foregoing and of the promises set forth in this Addendum to Settlement Agreement, the undersigned Attorneys General, on their own behalf and on behalf of their respective States, and Liggett and Brooke Group hereby stipulate and agree that the Initial Settlement shall be changed and amended as follows: <a name="E7E1"></a><br />1. With respect to each of the Initial Settling States defined in the Agreement of March 15, 1996 and March 1997 Brooke Group and Liggett, upon execution of this Amendment to the March 15, 1996 Agreement, shall cooperate in and facilitate reasonable third party discovery from Brooke Group and Liggett in connection with any Attorney Generals Action, provided that such information disclosed or provided by Brooke Group and/or Liggett is not disclosed to any third parties except as required by law, including non-settling Attorneys General. <a name="E7E1"></a><br />2. The March 15, 1996 Agreement shall be deemed amended to expressly include the following provisions from the March 1997 Attorneys General Settlement Agreement. <a name="E7E1"></a><br />§4.1 <a name="E7E1"></a><br />§4.2 <a name="E7E1"></a><br />§4.3.1, §4.3.2, §4.3.3, §4.3.4 <a name="E7E1"></a><br />§4.5 to the extent this provision increases the required compliance with FDA Rules. <a name="E7E1"></a><br />§4.8 <a name="E7E1"></a><br />§5 <a name="E7E1"></a><br />3. The following sections shall be deleted from the March 15, 1996 Agreement or Amended as set forth below: <a name="E7E1"></a><br />§4.1 is deleted <a name="E7E1"></a><br />§4.4 is replaced by §4.7 of the March 1997 agreement. <a name="E7E1"></a><br />§4.5 is amended by supplementing it with §4.8 of the March 1997 agreement to the extent the provision of §4.8 of the March 1997 agreement require greater compliance with FDA Rules. <a name="E7E1"></a><br />4. Section 4 of the March 15, 1996 agreement shall in all other respects remain in full force and effect. <a name="E7E1"></a><br />5. Section 5.7 is to be deleted from the March 1996 Agreement. <a name="E7E1"></a><br />6. Section 8.2 of the 1996 agreement shall be amended to substitute the words "Non-Settling Tobacco Companies" for the current word "Defendants". <a name="E7E1"></a><br />7. Section 16.12 of the 1996 Agreement will be retained for the continuing jurisdiction of the court over documents produced under this Agreement as amended.<br />IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and date first written above.<br /><a name="E7E2"></a><br />STATE OF MISSISSIPPI <a name="E7E2"></a>By Mike Moore Attorney General<br /><a name="E7E2"></a><br />STATE OF LOUISIANA By Richard P. Ieyoub Attorney General<br /><a name="E7E2"></a><br />STATE OF WEST VIRGINIABy Darrell V. McGraw <a name="E7E2"></a>Attorney general<br /><a name="E7E2"></a><br />BROOKE GROUP LTD. By Bennett S. LeBow<br /><a name="E7E2"></a><br />STATE OF FLORIDA By Robert Butterworth <a name="E7E2"></a>Attorney General<br /><a name="E7E2"></a><br />LIGGETT GROUP, INC. <a name="E7E2"></a>By Bennett S. LeBow<br /><br /><br /><SPAN style="DISPLAY: none"><br />Anahtar kelimeler<br />investor state dispute settlement<br />new york state settlement<br />state class action<br />state settlement<br />state settlement agreement<br />state tax settlement<br />state tobacco settlement<br />states settlement<br />tobacco settlement states<br />washington state class action<br />washington state settlement<br />1998 multi state tobacco settlement<br />1998 state tobacco settlement<br />all state class action<br />ameriquest multi state settlement<br />amicable settlement of limits with the state of georgia<br />dry settlement states<br />list of wet settlement states<br />member report report settlement state<br />multi state settlement agreement<br />multi state tobacco settlement<br />new york state class action<br />new york state tobacco settlement<br />november 1998 multi state tobacco settlement<br />settlement and present state of kentucke<br />settlement in washington state<br />settlement of investment disputes between states<br />settlement pattern in kabba kogi state<br />settlement state state<br />state court class action<br />state street settlement<br />survey of state class action law<br />the november 1998 multi state tobacco settlement<br />tri state settlement<br />two state settlement<br />virginia state settlement<br />west virginia state settlement<br />wet settlement state<br />wet settlement states<br />Anahtar kelimeler<br />america states<br />debt settlement<br />government states<br />payment settlement<br />america settlement<br />american settlement<br />american states<br />bankruptcy settlement<br />california settlement<br />canada settlement<br />credit card settlement<br />credit settlement<br />divorce settlement<br />federal states<br />florida settlement<br />florida states<br />india states<br />insurance settlement<br />international settlement<br />life settlement<br />maryland settlement<br />mortgage settlement<br />new england states<br />north carolina states<br />pennsylvania states<br />property settlement<br />settlement law<br />states in india<br />states of india<br />states rights<br />tax settlement<br />texas settlement<br />texas states<br />tobacco settlement<br />virginia settlement<br />virginia states<br />13 colonies settlement<br />against settlement<br />cigarette settlement<br />civil settlement<br />colonial settlement<br />consumer settlement<br />debts settlement<br />disputes settlement<br />georgia settlement<br />history of settlement<br />india settlement<br />marriage settlement<br />massachusetts settlement<br />new england settlement<br />north carolina settlement<br />ontario settlement<br />pennsylvania settlement<br />separation settlement<br />settlement colonies<br />settlement colony<br />settlement fraud<br />settlement judge<br />settlement laws<br />settlements states<br />smoking settlement<br />spouse settlement<br />states complaints<br />wto settlement<br 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having sex with horse<br />www horsesex com<br />man died after having sex with a horse<br />trailers of women having sex with horses com<br />Anahtar kelimeler<br />dog sex<br />horse lovers<br />animal horsesex<br />equestrian sex<br />equine lovers<br />equine sex<br />girl horsesex<br />horse fuk<br />horseback sex<br />horses lovers<br />horsesex blog<br />horsesex clips<br />horsesex dvd<br />horsesex galleries<br />horsesex gallery<br />horsesex girls<br />horsesex lover<br />horsesex movie<br />horsesex mpegs<br />horsesex mpg<br />horsesex nl<br />horsesex pics<br />horsesex picture<br />horsesex pictures<br />horsesex stories<br />horsesex trailers<br />horsesex video<br />horsesex with<br />stable sex<br />horsesex xom<br /><br /><br /><br /><br /><br /><br /><br /></span>Settlementhttp://www.blogger.com/profile/07780234485860161985noreply@blogger.com0tag:blogger.com,1999:blog-8812498477003583262.post-6795677421309573072007-10-24T06:53:00.000-07:002007-10-24T06:56:04.875-07:00LIGGETT SETTLEMENTATTORNEYS GENERAL SETTLEMENT AGREEMENT<br />This SETTLEMENT AGREEMENT is entered into this 20th day of March, 1997 by and among the States listed in Appendix A hereto (collectively, "Plaintiffs") and Brooke Group Ltd., a Delaware corporation ("Brooke Group"), Liggett & Myers Inc., a Delaware corporation ("Myers"), and Liggett Group, Inc., a Delaware corporation (which, with Myers, is hereinafter referred to as Liggett).<br />RECITALS<br />WHEREAS,<br />A. The Plaintiffs, by and through their respective Attorneys General (the "Attorneys General"), have brought [or are contemplating bringing] civil actions ("Actions") in various jurisdictions across the nation ("Actions") against, among others, the American Tobacco Company, Inc., BAT industries, PLC, British American Tobacco Company, R.J. Reynolds Tobacco Company, Brown & Williamson Tobacco Corporation, Philip Morris, Inc., Liggett & Myers, Inc., Lorillard Tobacco Company, Inc., and United States Tobacco Company and their various parent and related companies ("Defendants"), asserting claims for, among other things, expenses allegedly arising from tobacco-related matters and injunctive relief concerning sales of cigarettes to minors.<br />B. Because of the importance of the agreements and undertakings by Liggett and Brooke Group herein to the goals of the Plaintiffs and the Attorneys General, including the prosecution of the Actions against non-settling defendants, Plaintiffs have agreed to extend financial settlement terms to Liggett and Brooke Group which will not be offered to any other defendants, all as set forth in this settlement agreement.<br />C. On March 15, 1996, the Commonwealth of Massachusetts, the State of Florida, the State of Louisiana, the State of Mississippi and the State of West Virginia and the Liggett and Brooke Group entered into a settlement (the Initial Settlement") of the Actions brought by the foregoing States, pursuant to which Liggett agreed to make certain payments, comply with certain proposed regulations restricting the marketing and sale of cigarettes to minors and to offer certain cooperation in connection with the prosecutions of such Actions against the other Defendants; all in accordance with the terms of the Initial Settlement, a copy of which is annexed hereto as Appendix B.<br />D. The Attorneys General, the Initial Settling States and Liggett and Brooke Group wish to expand upon the Initial Settlement, through this Settlement Agreement to cover all of the Actions and to provide for, among other things, significantly greater cooperation by the Settling Defendants with the Attorneys General, all in accordance with the terms of this Settlement Agreement.<br />E. The Attorneys General acknowledge and agree that this Settlement Agreement, including the cooperation provisions thereof, are important to the prosecutions of their Actions against the non-settling Defendants.<br />F. The Attorneys General and Liggett and Brooke Group recognize and support the public interest in preventing smoking by, or promotion of smoking to, children and adolescents.<br />G. Liggett and Brooke Group have denied, and continue to deny any wrongdoing or any legal liability of any kind in all of the above-mentioned actions.<br />H. The settling States and the Attorneys General recognize and acknowledge that the cooperation being provided is valuable to the continued prosecution of the claims against the tobacco industry. Further, the Settling States and the Attorneys General acknowledge that the change in warning labels provided for in this Settlement Agreement is a step towards properly informing consumers more fully of the truth about cigarettes and the consequences of smoking, as is the statement by Liggett also provided for herein.<br />NOW, THEREFORE, in consideration of the foregoing and of the promises and covenants set forth in this Agreement, the undersigned Attorneys General, on their own behalf and on behalf of their respective States, and the Liggett and Brooke Group hereby stipulate and agree that the Attorney General Actions shall be settled as against the Liggett and Brooke Group, and that all claims asserted in the Attorney General Actions against Liggett and Brooke Group shall be dismissed, all on the terms contained herein, as follows:<br />1. Definitions.<br />As used in and solely for the purposes of this Agreement, in addition to terms defined elsewhere in the Agreement, the following terms shall have the following respective meanings:<br />"Affiliate": means a Present Affiliate or a Future Affiliate.<br />"Agreement" means this Settlement Agreement.<br />"Arbitrator" means the person or persons agreed to by the Settling States and the Settlement Class, and/or their counsel, or appointed by the Class Action Court of the Multidistrict Litigation Panel, as the case may be, to make decisions regarding allocations of the Settlement Fund between the Settling States and the Settlement Class, and to resolve disputes of the Oversight Committee. With respect to the Settlement Fund, in the event that the Settling States and the Settlement Class, and/or their respective counsel, cannot agree on an allocation of the Settlement Fund between the Settling States and the Settlement Class, the Settling States and the Settlement Class will petition the Court for appointment of an arbitrator. In so doing, the parties do not consent, nor should it be inferred, that the Multidistrict Litigation Panel has jurisdiction over any of the parties.<br />"Attorneys General" means those State Attorneys General or other parties who have brought Attorney General Actions.<br />"Attorney General Actions" or "Actions" means the actions listed in Appendix A hereto, including those actions brought on behalf of the State as taxpayer actions.<br />"Attorney General Settlement Fund Board" or "Attorney General Board" means, the entity established pursuant to Section 5 of the Initial Settlement.<br />"Brooke Group" means Brooke Group, Ltd. and its Present Affiliates other than Liggett.<br />"Cigarette" means any product including components, accessories, or parts which is intended to be burned under ordinary conditions of use and consists of: (1) any roll of tobacco wrapped in paper or in any substance not containing tobacco; or (2) any roll of tobacco wrapped in any substances containing tobacco which, because of its appearance, the type of tobacco used in the filler, or its packaging and labeling, is likely to be offered to, or purchased by, consumers as described in subparagraph (1).<br />"Cigarette Pack" means a unity of twenty Cigarettes or one ounce of Tobacco Snuff, or any other similar method of delivery to consumers.<br />"Cost Per Cigarette Pack" means, with respect to a Tobacco Company, the aggregate costs incurred by such Tobacco Company under a Global Settlement during the specified year, divided by the number of Cigarette Packs manufactured by such Tobacco Company during such year, as determined by The Maxwell Consumer Report published by Wheat First Butcher Singer of a similar or successor report.<br />"Defendants" means The American Tobacco Company, Inc., BAT Industries, PLC., British American Tobacco Company, R.J. Reynolds Tobacco Company, Brown & Williamson Tobacco Corporation, Philip Morris, Inc., Liggett & Myers, Inc., Lorillard Tobacco Company, Inc., and United States Tobacco Company and their various parent and related companies.<br />"Domestic Tobacco Operations" means the manufacture and/or sale of cigarettes and any other tobacco products in the United States, its territories, its possessions and the Commonwealth of Puerto Rico.<br />"FDA Rule" means the regulations promulgated by the FDA on August 28, 1996 concerning the sale and distribution of cigarettes and other products at 60 Fed. Reg. 44396, to be codified at 21 C.F.R. Parts 801, 803, 804, 807, 820, and 827.<br />"Future Affiliate" means any one entity, other than an entity with a Market Share greater than 30% as of the date of this Agreement, which is a Non-settling Tobacco Company (including any successor to or assignee of its assets) if such entity or an Affiliate of such entity with the prior written approval of Brooke Group, subsequent to the date, and during the term, of this Agreement but prior to the fourth anniversary of the date of execution of this Settlement Agreement: (I) directly or indirectly acquires or is acquired by Liggett of Brooke Group; (ii) directly or indirectly acquires all or substantially all of the stock or assets of the Liggett or Brooke Group; (iii) all or substantially all of whose stock or assets are directly or indirectly acquired by Liggett of Brooke Group; or ((iv) directly or indirectly merges with Liggett or Brooke Group.<br />"Future Affiliate Transaction" means a transaction, or series of transactions, by which an entity becomes a Future Affiliate.<br />"Global Settlement" means any national disposition, settlement, Agreement or other arrangement, such as "Tobacco Claims Legislation", by way of legislation, executive order, regulation, taxation, levy, fine, class Action settlement, court order or otherwise, of smoking-related litigation, in direct or indirect connection with one or more Tobacco Companies receive the benefit of a limitation of, or total or partial immunity from, liability to plaintiffs for the types of claims released under the terms of this Agreement.<br />"Initial Settlement" means the settlement agreement entered into by the initial Settling States and the Settling Defendants on March 15, 1996.<br />"Initial Settling States" means the States of Mississippi, West Virginia, Florida, and Louisiana, the Commonwealth of Massachusetts, and the respective Attorneys General thereof.<br />"Liggett" means Liggett Group, Inc. and Liggett & Myers, Inc.<br />"Mandatory Class Settlement Agreement" of "Mandatory Class Agreement" means the Agreement entered into on or about March 20, 1997 between Brook Group and Liggett and a nationwide class.<br />"Mandatory Class Final Order and Judgment" or "Mandatory Class Final Approval" means the order to be entered by the Settlement Court with respect to Liggett and its Present Affiliates, approving the Mandatory Settlement Agreement without material alterations, as fair, adequate and reasonable under Rule 23 of the Federal Rules of Civil Procedure, confirming the Mandatory Settlement Class certification under Rule 23 thereof, and making such other findings and determinations as the Settlement Court deems necessary and appropriate to effectuate the terms of the Mandatory Class Agreement and to exercise its continuing and exclusive jurisdiction over the enforcement and administration of all terms of the Mandatory Class Agreement.<br />"Mandatory Settlement Class" means the Settlement Class defined in the Mandatory Class Agreement.<br />"Mandatory Class Settlement Date" means the date on which all of the following shall have occurred: (a) the entry of the Mandatory Class Final Order and Judgment without material modification, and (b) the achievement of the finality for the Mandatory Class Final Order and Judgment by virtue of that order having become final and non-appealable through (i) the expiration of all appropriate appeal periods without an appeal having been filed; (ii) final affirmance of the Mandatory Class Final Order and Judgment on appeal or final dismissal or denial of all such appeals, including petitions for review, rehearing or certiorari; or (iii) final disposition of any proceedings, including any appeals, resulting from any appeal from the entry of the Mandatory Class Final Order and Judgment.<br />"Market Share" means, with respect to a Defendant and a specified year, the Domestic Tobacco Operations market share in that year of all of such Defendant's cigarettes and other tobacco products, as determined by The Maxwell Consumer Report published by Wheat First Butcher Singer or a similar or successor report.<br />"Medicaid Population" means, with respect to a Settling State and a specified data, the Medicaid population of such Settling State as reported by the most recent United States Census.<br />"National" means actually covering or potentially covering (whether by block grants to states, localities or other governmental entities or otherwise) the United States or the United States and one or more of its territories, possessions and the Commonwealth of Puerto Rico.<br />"Non-settling Tobacco Companies" means each of The American Tobacco Co., Lorillard Tobacco Co., Philip Morris Inc., R.J. Reynolds Tobacco Co., Brown & Williamson Tobacco Corp., and United States Tobacco Co., unless and until it becomes a Future Affiliate, as herein defined.<br />"Other Settlement" means settlement of an action which is not a Global Settlement.<br />"Oversight Committee" means a committee, made up of no less than nine (9) individuals, to oversee the cooperation provided by Settling Defendants under Section 4.3.1 and 4.3.2 hereof. The committee shall have not less than 75% of its composition from representation of the Attorneys General.<br />"Parent," with respect to Liggett means Brooke Group, and with respect to any other specified corporation or entity, means another corporation, partnership or other entity which directly or indirectly controls such specified corporation or entity.<br />"Parties" means the Plaintiffs and Brooke Group and Liggett.<br />"Population" means, with respect to a geographic area, the population of that area as reported in the most recent census conducted by the United States Bureau of the Census.<br />"Present Affiliate" means, with respect to a specified corporation or entity, another corporation, partnership or other entity which as of the date of this Agreement, directly or indirectly, controls, is controlled by, or is under common control with, such specified corporation or entity including any and all Parents, subsidiaries, and/or sister corporations or entities of such specified corporation or entity.<br />"Present Value" means, with respect to a specified amount or amounts, the present value of such amount or amounts as calculated using a discount rate equal to the yield on 10-year Treasury Notes as reported in the Wall Street Journal at the time of such calculation; provided that where such amount or amounts are not otherwise determinable, the amount or amounts to be present-valued shall be deemed to be the average for the most recent three years.<br />"Pretax Income," with respect to Liggett, means for a specified year, the "Income before Income Taxes" as determined in accordance with generally accepted accounting principles ("GAAP") of Liggett for its most recent fiscal year, as reported in filings to the United States Securities and Exchange Commission or, if there is no such filing, as reported by Liggett's independent outside auditors. If GAAP changes in any material respect during the term of this Agreement so that the benefits anticipated by the parties (in light of GAAP applicable on the date of this Agreement), an appropriate adjustment shall be made to the formulas and calculations hereunder to achieve the parties' expectations as of the date hereof.<br />"Protective Order" or "Stipulation Regarding Liggett Documents" means, with respect to privileged documents produced by a Settling Defendant in an Attorney General Action, an order in that Action: (a) protecting the confidentiality of such documents; (b) providing that such documents may be used only in that Attorney General Action and, to the extent permitted by law, only under seal; (c) providing that, to the extent such documents are or may be subject to the attorney/client privilege or the attorney work product doctrine, such production or use of the documents does not constitute a waiver of such privilege, doctrine or protection with respect to any party other than the Attorney General to whom the documents are produced subject to the order. The provisions of the order shall not apply to documents claimed to be privileged but which are determined by the court in any Action or by the Settlement Court not to be privileged for reasons other than waiver due to production pursuant to this Agreement.<br />"Settlement Class" means the settlement class provided for in the Mandatory Class Agreement.<br />"Settlement Class Counsel" means the firms listed as Settlement Class Counsel in Section 25.8 of the Mandatory Class Settlement Agreement.<br />"Settlement Fund" means the fund established in accordance with the terms of Section 6 of this Agreement, which shall be established in a reputable bank or other financial institution, to provide a secure and interest-bearing fund, and which shall be jointly controlled by the Settling States and the Mandatory Settlement Class.<br />"Settling Defendants" means Brooke Group and/or Liggett.<br />"Settling Defendants' Counsel" means the law firm of Kasowitz, Benson, Torras & Friedman L.L.P.<br />"Settling States" means the States listed in Appendix A hereto and Subsequent Settling States, if any.<br />"Smokers" means all persons who, prior to or during the term of this Agreement, have smoked Cigarettes or have used other tobacco products and have suffered or claim to have suffered Injury as a consequence thereof.<br />"Subsequent Settling States" means States other than the States listed in Appendix A hereto which commence an Attorney General Action and which execute this Agreement within six months from the date of this Agreement (unless such six-month period is extended or reopened at the option of the Settling Defendants).<br />"Tobacco Companies" means Defendants.<br />"Tobacco Snuff" means any cut, ground, powdered, or leaf tobacco that is intended to be placed in the oral cavity.<br />2. Settlement Purposes Only.<br />This Agreement is for settlement purposes only, and neither the fact of, or any provision contained in, this Agreement nor any action taken hereunder shall constitute, be construed as, or be admissible in evidence against the Settling Defendants as, any admissible of the validity of any claim, any argument or any fact alleged or which could have been alleged by Plaintiffs as to their standing or as to any jurisdictional, constitutional or any other legal or factual issue in any Attorney General Action or alleged or which could have been alleged in any other action or proceeding of any kind or of any wrongdoing, fault, violation of law, or liability or any kind on the part of the Settling Defendants or any admission by them of any claim or allegation made or which could have been made in any Attorney General Action or in any other action or proceeding of any kind, or as an admission by any of the Plaintiffs of the validity of any fact or defense asserted against them in any Attorney General Action or in any other action or proceeding of any kind.<br />3. Parties.<br />3.1 This Agreement shall be binding, in accordance with the terms hereof, upon Brooke Group, Liggett and the Settling States; provided that, notwithstanding anything else contained in this Agreement, the payment obligations of this Agreement shall be binding only upon Liggett.<br />3.2 No Settling Defendant shall sell, use, dispose or transfer substantially all of its cigarette brands or businesses without first causing the acquirer, on behalf of itself and its successors, to be bound by all of the obligations of a Settling Defendant pursuant to Sections 4.2 and 4.4 through 4.8 hereunder as to such transferred brands or businesses; provided that this Section 3.2 shall not apply to the extent such sale, disposition or transfer is required by the Federal Trade Commission, Department of Justice, State Attorney General or court order.<br />4. Public Statement; Cooperation; Advertising Limitations.<br />4.1 Upon execution of this Settlement Agreement, Liggett shall, by and through its Director, Bennett S. LeBow, issue a public statement substantially in the following form and substance:<br />I am, and have been for a number of years, a Director of Liggett Group Inc., a manufacturer of cigarettes. Cigarettes were identified as a cause of lung cancer and other diseases as early as 1950. I, personally, am not a scientist. But, like all of you, I am aware of the many reports concerning the ill-effects of cigarette smoking. We at Liggett know and acknowledge that, as the Surgeon General and respected medical researchers have found, cigarette smoking causes health problems, including lung cancer, heart and vascular disease and emphysema. We at Liggett also know and acknowledge that, as the Surgeon General, the Food and Drug Administration and respected medical researchers have found, nicotine is addictive.<br />Liggett will continue to engage in the legal activity of selling cigarettes to adults, but will endeavor to ensure that these adult smokers are aware of the health risks and addictive nature of smoking. As part of our efforts, we will do the following:<br />1. In accordance with a court-approved settlement, Liggett will set up a fund to compensate equitably those who claim to have been injured by our products.<br />2. Liggett will add a prominent warning to each of our packages of cigarettes and all of our cigarette advertising stating that "Smoking is Addictive."<br />3. Liggett supports and will not challenge Food and Drug Administration regulations concerning the sale and distribution of nicotine-containing cigarettes and smokeless tobacco products to children and adolescents. Accordingly, Liggett has agreed to comply with many of these regulations even before they apply to the tobacco industry generally.<br />4. Liggett has instructed its advertising and marketing people to scrupulously avoid any and all advertising or marketing which would appeal to children or adolescents. Liggett acknowledges that the tobacco industry markets to "youth," which means those under 18 years of age, and not just those 18-24 years of age. Liggett condemns this practice and will not market to children. Liggett agrees that if it sees industry advertisements which in its view are aimed at children, it will bring this to the attention of the Attorneys General.<br />5. In accordance with our settlement agreements, Liggett agrees to fully cooperate with the Attorneys General and Settlement Class Counsel in their lawsuits against the other tobacco companies. To that end, Liggett will make available to the Attorneys General, Settlement Class Counsel and other parties with whom we have settled all relevant documents and information, including documents subject to Liggett's own attorney-client privileges and work product protections, and will assist those parties in obtaining prompt court adjudication of the rest of the industry's joint privilege claims.<br />4.2 As promptly as reasonably practicable, but no later than six months after execution of this Settlement Agreement, Settling Defendants shall cause to be printed boldly, on all of the Cigarette packages and in all of their Cigarette advertising, in addition to the warnings mandated under the Federal Cigarette Labeling and Advertising Act, as amended 15 U.S.C. § 1331 et seq., the statement that cigarette smoking is addictive. To the extent any Settling Defendant manufactures and sells other tobacco products, a similar warning shall be placed on such product.<br />4.3.1. With respect to each Settling State, upon execution of this Agreement, each Settling Defendant shall:<br />(1) cooperate with such Attorney General, and the attorneys representing such Attorney General, in that such Settling Defendants will take no steps to impede or frustrate these counsels' civil investigations into, or civil prosecutions of, any of the Non-settling Tobacco Companies in these actions, so as to secure the just, speedy and inexpensive determination of all such smoking-related claims against said non-settling persons and entities;<br />(2) cooperate in and facilitate reasonable non-party discovery from Settling Defendants in connection with such Attorney General Action;<br />(3) actively assist the attorneys representing the Attorneys General in identifying and locating any and all persons known to such Settling Defendant to have documents or information that is discoverable in such proceedings, to actively assist said counsel in interviewing and obtaining documents and information from all such persons, and to encourage such person to cooperate with the Attorneys General; and shall actively assist counsel in interpreting documents relating to litigation against Non-settling Tobacco Companies; and<br />(4) insofar as such Settling Defendant has or obtains any material information concerning any fraudulent or illegal conduct on the part of any parties, including Non-settling Tobacco Companies, their agents, or their co-defendants designed to frustrate or defeat the claims of the plaintiffs against such parties, companies, agents or co-defendants, or which have the effect of unlawfully suppressing evidence relevant to smoking claims, disclose such information to the appropriate judicial and regulatory agencies.<br />4.3.2. With respect to each Settling State, subject to, and promptly after, the entry of a Protective Order or a Stipulation Regarding Liggett Documents by the court in which the respective Attorney General Action is pending or the Settlement Court, each Settling Defendant shall:<br />(1) promptly provide all documents and information that are relevant to the subject matter of the Actions or which are likely to lead to admissible evidence in connection with the claims asserted in any of the Actions, subject to the provisions of Section 4.3.2(2) hereof;<br />(2) waive any and all applicable attorney-client privileges and work product protections with respect to such documents and information. Such waiver shall not extend to (a) documents and information not relevant to the subject matter of the Actions or not likely to lead to admissible evidence in connection with claims asserted in any of the Actions or (b) documents subject to a joint defense or other privilege or protection which Settling Defendants cannot legally waive unilaterally, except that the waiver by the Settling Defendant shall apply, to the extent permitted by law, to its own joint defenses or other privileges. To the extent that a Settling Defendant has a good faith belief, or one or more Non-settling Tobacco Companies claims, that documents to be provided pursuant to Section 4.3.2(1) hereof may be subject to a joint defense or other privilege (or a claim of such privilege) of one or more of the Non-settling Tobacco Companies, such documents shall be deposited under seal for in camera inspection by the Settlement Court or a court in which a Settling State's Attorney General Action is pending, together with a statement to such court that such Settling Defendant has concerns as to whether some or all of such documents should be protected from discovery, and the Parties agree to request that such court shall retain jurisdiction to resolve that issue. Liggett will participate in proceedings, including by way of court appearances or declarations, concerning issues of whether such documents are discoverable;<br />(3) offer their employees, and any and all other individuals over whom they have control, and help locate former employees, to provide witness interviews of such employees and to testify, in depositions and at trial; it being understood and agreed that Liggett will waive and hereby does waive any and all applicable confidentiality agreements to the extent such confidentiality agreements would restrict testimony under this Agreement, if any, to which such witnesses may be subject; and<br />(4) demand from its past or current national legal counsel all documents and information obtained by them in the course of representation of any Settling Defendant which in any way relates to the cooperation required in paragraphs 4.3.1(1) - 4.3.2(3) above, which should be provided to the Settling States as provided under this paragraph.<br />4.3.3. With respect to the cooperation set forth in subsections 4.3.1 and 4.3.2 above, the Attorneys General and Settlement Class Counsel shall appoint, on a yearly basis, an Oversight Committee, to oversee such cooperation so that it fairly assist them and minimizes the burden on a Settling Defendant. All requests for cooperation will be first made to the Oversight Committee. The Oversight Committee shall coordinate such requests giving due regard to the legitimate needs of the litigants requesting cooperation and the burden on the Settling Defendant. Nothing in this Agreement shall waive or alter the rights of the Attorneys General to obtain discovery of Liggett as required by a court order or case management order in any Attorneys General Action, provided that no order is sought that is inconsistent with this Agreement.<br />4.3.4. In the event the Oversight Committee cannot agree on the sharing of cooperation by litigants, any member of the Committee may seek resolution by an Arbitrator. In the event that the Oversight Committee cannot agree on the selection of an Arbitrator, the Oversight Committee will petition the Multidistrict Litigation Panel for appointment of an Arbitrator. In the event any Settling Defendant, absent good cause, does not provide requested cooperation as promptly as reasonably practicable, after receiving written notice from the Committee of such request, (1) the Committee may seek relief from an Arbitrator, and (2) the Committee, upon notice to the Settling Defendant, may petition an Arbitrator for specific performance of such requested cooperation.<br />4.4 Each Settling Defendant, promptly after becoming bound by this Agreement, shall consent to jurisdiction by the FDA for the sole purpose of promulgating the FDA Rule with respect to all Tobacco Companies. Further, each Settling Defendant, promptly after execution of this Agreement, shall endorse, support and assist in attempts by the FDA to have the FDA Rule become enforceable. Such efforts shall include, if and as reasonably requested by the Attorneys General, filing appropriate amicus briefs and other court papers in litigation relating to the FDA Rule.<br />4.5 Each Settling Defendant shall follow and abide by the provisions of the FDA Rule, insofar as they pertain solely to such Settling Defendant's Domestic Tobacco Operations, as set forth in, and modified by, paragraphs 4.5.1 - 4.5.4 hereof until a final determination is reached respecting the FDA Rule at which time the Settling Defendant will be bound by the FDA Rule only insofar as, and to the extent that, the FDA Rule becomes an enforceable obligation binding upon all of the Tobacco Companies.<br />4.5.1. FDA Rule § 897.16(b), as proposed.<br />4.5.2. FDA Rule § 897.16(d), as proposed.<br />4.5.3. FDA Rule § 897.30(a), as proposed.<br />4.5.4. FDA Rule § 897.30(b), but only to the extent that such section applies to billboards within 1,000 feet of a clearly marked public or private elementary or secondary school or a clearly marked, outdoor, municipal or other government-operated public playground for children.<br />4.6 Notwithstanding anything to the contrary in the Proposed Rule or in this Agreement, Liggett will commence compliance with Section 4.5 of this Agreement as soon as reasonably practicable, according priority as to compliance to the States listed in Appendix A hereto and then to Subsequent Settling States; provided that Liggett may limit its compliance to the extent, if any, necessary to ensure that the net annual out-of-pocket cost to Liggett of such compliance not exceed $1 million; and provided further that Liggett shall not be obligated pursuant hereto to breach pre-existing legal obligations, if any, it may have with respect to the matters covered by Section 4.5 (and shall use its reasonable best efforts to minimize the degree to which any such obligations would impede its full compliance therewith). For purposes of this paragraph, the phrase "net annual out-of-pocket costs" means the excess of (a) the additional out-of-pocket expenditures incurred during a particular year by Liggett in complying with the matters specified in Section 4.5, over (b) savings, if any, in out-of-pocket expenditures realized during such year by Liggett directly from the implementation of the matters covered by Section 4.5.<br />4.7. If, when and to the extent the FDA Rule, in whole or in part, becomes an enforceable legal obligation binding upon all of the Defendants, each Settling Defendant will comply therewith, without consideration of any limits or exceptions herein. If the FDA Rule does not so become such a legal obligation, Liggett shall, during the duration of this Agreement, continue to comply with Section 4.5.<br />4.8. Each Settling Defendant shall not use cartoon characters, such as "Joe Camel," in any of its advertising and promotional materials and activities with respect to tobacco products. No Settling Defendant shall enter into any new contract for advertising and promotion with respect to tobacco products using any such cartoon characters after the date the Settling Defendants become bound by this Agreement.<br />4.9. Each Settling Defendant may, after becoming bound by this Settlement Agreement, continue in the lawful manufacture, advertising and/or sale of tobacco products. This Settlement Agreement does not in any way abrogate or restrict the authority or ability of the Attorneys General to enforce future compliance with the laws of their respective States.<br />5. Global Settlement.<br />5.1 Effective upon the execution hereof, the Attorneys General and their respective counsel, each agree (a) to exercise best efforts to ensure that the financial terms, financial obligations or financial conditions of any Global Settlement are no more onerous on, or less favorable to, Brooke Group and Liggett than the financial terms, financial obligations or financial conditions of this Settlement Agreement, and (b) to issue a public statement substantially in the following form and substance:<br />The historic settlements entered into by Liggett, whereby Liggett has agreed, among other things, to provide full cooperation to twenty-two Attorneys General and to consent to FDA regulation of tobacco marketing, are a major advance in our efforts to prevent smoking by children and adolescents and to ensure that the tobacco industry markets its products lawfully. Accordingly, the undersigned Attorneys General will use their best efforts in Congress and elsewhere to ensure that any such industry-wide resolution provide for financial terms for Liggett that reflect appropriate recognition of Liggett's cooperative efforts.<br />5.2. In the event there is a Global Settlement at any time which contains financial terms, financial obligations or financial conditions as to Brooke Group and Liggett which are more onerous on, or less favorable to, Brooke Group and Liggett than those of this Settlement Agreement, then, in addition to and not in derogation of any other rights or remedies Brooke Group and Liggett may have, Brooke Group and Liggett shall have the right, at their option to withdraw from further performance of this Agreement.<br />6. Settlement Fund.<br />6.1. Except as may otherwise be provided herein, all amounts due and owing by each Settling Defendant under this Agreement shall be paid when due into the Settlement Fund to be allocated and distributed to Settlement Class members and Settling States in accordance with this and the Mandatory Class Settlement Agreement. In the event that the Settling States and Settlement Class Counsel cannot agree to an equitable allocation of the Settlement Fund between the Settling States and the Settlement Class, the Settling States and Settlement Class Counsel shall seek to agree on the selection of an Arbitrator to determine such allocation. In the event that the Settling States and Settlement Class Counsel cannot agree on the selection of an Arbitrator, the Settling States and Settlement Class Counsel will petition the Class Action Court to determine such allocation; it being understood that some portion of the Settlement Fund will be allocated to counter-market advertising.<br />6.2. Settling Defendants shall have no interest in or responsibility for allocations or distributions from the Settlement Fund and do not guarantee any earnings or insure against any losses from any portion of the Settlement Fund assets that may be maintained or administered as provided in Section 6.1 above.<br />6.3. Subject to the terms of this Agreement, Liggett shall make the following payments:<br />6.3.1. An initial payment of $25 million due 120 days from the date of a Future Affiliate Transaction; and<br />6.3.2. Subject to the provisions of Sections 6.6 - 6.12, payments, each equivalent to 25% of Liggett's Pretax Income, due 120 days after the end of each fiscal year of Liggett. The first payment shall be made with respect to the first full fiscal year commencing after the date of this Settlement Agreement.<br />6.4. Liggett shall pay the reasonable and necessary expenses of the administration, allocation, and distribution of the Settlement Fund; provided that Liggett shall not be obligation to pay more than $1 million in any year for such expenses.<br />6.5. Since the Settling Defendants are providing historic and valuable cooperation and other considerations under this Agreement and the Mandatory Class Agreement, the amounts payable hereunder to the Settlement Fund shall represent the maximum amounts payable to the Settlement Fund under this Agreement and the Mandatory Class Agreement.<br />6.6. With respect to each Settling State, in the event of the entry of any final non-appealable monetary judgment in such Settling State's Attorney General Action (other than by way of settlement) against any one or more of the Non-settling Tobacco Companies, then the Settling Defendants shall have the right to reduce the payments they are obligated to make pursuant to this Agreement to the extent necessary to make (i) the then Present Value of all amounts theretofore paid and thereafter payable to that Settling State pursuant to this Agreement by the Settling Defendants (such amounts being calculated for purposes of this Section 6.6 by multiplying (a) the total amount of the Settlement Fund allocated to all of the Settling States in that year by (b) a quotient equal to the Medicaid Population of such Settling State in that year divided by the total Medicaid Population of all Settling States) per percentage point of the then Market Share of such Settling Defendant no more than seventy-five percent (75%) of (ii) the then Present Value of the dollar amount of such judgment per percentage point of the then Market Share of each such Non-settling Tobacco Company; [ Example : For purposes of this example of Section 6.6, assume: Liggett has a 2% Market Share ( i.e. , 2 points). A Non-settling Tobacco Company has an 8% Market Share ( i.e. , 8 points), and in 1998 has a final judgment entered against it in an Attorney General Action that requires payments by such Non-settling Tobacco Company with a then Present Value of $20 million. The Present Value of the amount allocable by Liggett to the Settling State in 1998 is $5 million. Result: In 1998, Liggett would be permitted to reduce its future payments to the extent necessary to make the Present Value of its past and future payments $3.75 million -- i.e. , no more than 75% of the Present Value of the judgment, all as adjusted for relative Market Share. The calculation would be as follows: Present Value of Liggett payment/2 points = .75 x judgment/8 points Present Value of Liggett payments = .75 x $20 million/4 = $3,750,000 Thus, the larger the judgment, the less the reduction. Under this example, if the judgment is $26,670,000 or more, there would be no reduction.] provided that such Settling Defendant give written notice of such reduction and the method of calculating such reduction to the Settling State's Attorney General as soon as practicable after the entry of the judgment.<br />6.7. In each year beginning with the second year after execution of this Agreement, the annual payment amount due under Section 6.3.2 of this Agreement from a Settling Defendant shall be decreased in proportion to any decrease and (only if there shall have been a prior such decrease) increase in proportion to any increase, in such Settling Defendant's Market Share from the prior year; provided, however, that (a) such annual payment amount shall not be so decreased to the extent, if any, that such annual payment amount in such year is decreased as a result of a decrease in such Settling Defendant's Pretax Income and (b) such annual payment amount shall never be increased such that the aggregate amount of any such increases exceeds that the aggregate amount of any such increases exceeds the aggregate amount of any such decreases. [ Example : For purposes of this example of Section 6.7, assume: Liggett's Pretax Income is $11 million each year, thus making Liggett's obligation under the settlement $2,750,000 per year. Liggett's Market Share drops from 2% in 1996 and 1997 to 1.75% in 1998, but recovers to 1.9% in 1999, and then back to 2.0% in 2000. Reduction: In 1998, Liggett's amount due will be reduced by $343,750 to $2,406,250. Since Liggett's Market Share fell by .25 points or 12.5%, its payments would be reduced by 12.5% or $343,750 [$2,750,000 x .125]. Recapture of Market Share: In 1999, Liggett's payments will climb commensurate to its increase of .15 in Market Share (1.75 to 1.9%) to $2,612,500 [$2,406,250 + ($2,406,250 x .15/1.75)]. In 2000, Liggett's payment would again increase commensurate to its increase of .1 in Market Share to $2,750,000 [$2,612,500 + ($2,612,500 x .1/1.90)]. Liggett would not be entitled to a "double reduction" for a decrease in both Pretax Income and Market Share. Thus, if Liggett's .25 point drop in Market Share in 1998 were accompanied by a drop in Pretax Income between 1997 and 1998 from $11 million to $8 million, there would be no Market Share reduction, as Liggett's payment obligations (25% of Pretax Income) would have already fallen from $2,750,000 to $2,000,000.]<br />6.8. In the event of a Global Settlement, the Settling Defendants shall have the right to reduce the aggregate payments due from Liggett in each year pursuant to this Agreement so that such aggregate payments shall be no more than the lesser of (A) on a Cost Per Cigarette Pack basis, one-third of the lowest Cost Per Cigarette Pack due in such year from the Non-settling Tobacco Companies under such Global Settlement and (B) on a percentage of Pretax Income basis, one-third of the lowest percentage of Pretax Income due in such year from the Non-settling Tobacco Companies under such Global Settlement (such percentage to be computed as if the payments due from such companies were included in revenues and earnings).<br />6.9. Liggett shall receive as a credit against any and all amounts due hereunder, any and all amounts it is required to pay under a Global Settlement.<br />6.10. In the event that one or more States elect to opt out of the Mandatory Settlement Class and action(s) are brought against any Settling Defendants on behalf of such State(s), the annual payment amount due under Sections 6.3.2 of this Agreement from a Settling Defendant shall be reduced by an amount equal to the product of (i) the ratio that the Medicaid Population of the States that elect to opt out of the Mandatory Settlement Class then bears to the total Medicaid Population and (ii) 20% of Liggett's Pretax Income.<br />6.11. Insofar as the Mandatory Class Settlement Agreement is not approved or is otherwise terminated, the Settlement Fund shall be administered solely thereafter by the Attorney General Board for the benefit of the Settling States, and the percentage of Liggett's Pretax Income payable under Section 6.3.2 shall, in the event there is no Global Settlement, be reduced to an amount equal to the product of (i) the ratio that the Medicaid Population of the Settling States then bears to the total Medicaid Population and (ii) 20% of Liggett's Pretax Income.<br />6.12. Any allocations set forth in this Section 6 among the Settling States and the Settlement Class are solely for the purposes of making the calculations set forth in this Section 6 and are in no way binding upon or evidence for the allocations of payments from the Settlement Fund to any recipients thereof.<br />6.13. Settling Defendants agree not to take any action the primary purpose of which is to reduce Liggett's payment obligations under this Agreement.<br />7. Release.<br />7.1 Upon the date each Settling State becomes bound by this Agreement, for good and sufficient consideration as described herein, each Settling State and each Attorney General thereof shall for the duration or term of this Agreement (whichever is shorter) be deemed to and hereby does release, dismiss and discharge each and every civil claim, right, and cause of action (including, without limitation, all claims for damages, restitution, medical monitoring, or any other legal or equitable relief), known or unknown, asserted or unasserted, direct or indirect, which they had, now have or may hereafter have against each Settling Defendant (including its past and present parents, subsidiaries, present affiliates, employees, directors and shareholders, but only in such capacities, vis-à-vis, each such Settling Defendant, and downstream distribution entities of Settling Defendant, but only to the extent that such downstream distribution entitles would have cross-claims against Settling Defendant), but does not in any fashion release any Non-settling Tobacco Companies or other defendants in any Attorney General Action except as provided for in Section 17 hereof, (i) which was asserted in that State's Attorney General Action, and/or (ii) which was not asserted in said Action but which is smoking-related or otherwise arises out of, or concerns, the acts, facts, transaction, occurrences, representations, or omissions set forth, alleged, referred to or otherwise embraced in the complaint of that Settling State's Attorney General Action.<br />Upon the date each Settling State becomes bound by this Agreement, for good and sufficient consideration as described herein, each such Settling Defendant shall for the duration or term of this Agreement (whichever is shorter) be deemed to and hereby does release, dismiss and discharge each and every claim, right, and cause of action (including, without limitation, all claims for damages, restitution, fees, expenses, or any other legal or equitable relief), whether known or unknown, asserted or unasserted, which they had, now have or may hereafter have as of the effective date of this Agreement against each such Settling State, its public officials and employees in connection with, arising out of or related to the acts, facts, transactions, occurrences, representations, or omissions set forth, alleged or referred to or otherwise embraced in the complaints of the Settling States' Attorney General Actions.<br />Provided, however, as follows:<br />1) If this Agreement expires upon completion of its full term, these releases set forth in this Section 7.1 shall continue and apply in full force and effect with respect to all released claims which accrued or shall accrue prior to, through and including the date of such expiration, such that such claims shall be forever released, but only as to such claims through and including such date; if this Agreement terminates for any reason prior to its full term, these releases shall be of no further force and effect and Settling Defendants shall be entitled to a credit to the extent otherwise provided in this Agreement against all claims covered by the release for the full amount paid by such Settling Defendants hereunder.<br />2) Except as specifically provided herein, these releases set forth in this Section 7.1 do not pertain or apply to any other existing or potential party in any present or future Attorney General Action.<br />3) These releases set forth in this Section 7.1 do not in any way release from claims which may asserted by a releaser involving conduct unrelated to the manufacture and/or sale of tobacco products.<br />4) With respect to the claims of any county, municipality or subdivision within a Settling State that, as of the date of this agreement, has brought an action against Settling Defendants separate and apart from the action brought against Settling Defendants by the Settling State encompassing such county, municipality or subdivision, these releases set forth in this Section 7.1 do not release the claims of such county, municipality or subdivision except for the exclusively State share of the Medicaid funds claimed in any such action.<br />5) The provisions of this Section 7.1 apply to all States except the State of Connecticut. With respect to the State of Connecticut only, the claims described herein as having been released shall not be released and shall remain in existence; provided, however, that the State of Connecticut and the Attorney General of Connecticut shall, upon entering into this agreement, covenant not to bring or prosecute any suit or action with respect to such claims against each Settling Defendant, and the beneficiaries of this covenant shall be the same beneficiaries of the release provided by all other States pursuant to § 7.1. It is expressly understood that this covenant is not intended to and does not release or affect any claims that the State of Connecticut has or may have against any other persons or entities, and in particular is not intended to and does not release or affect any claims that the State of Connecticut has asserted or may assert against any Non-settling Tobacco Companies or any other defendants in its Attorney General Action.<br />7.2 Except as specifically provided herein, nothing in this Agreement shall prejudice or in any way interfere with the rights of Settling States or Settling Defendants to pursue any or all of their rights and remedies against Non-settling Tobacco Companies or other parties not released hereunder.<br />7.3. With respect to the State of Maryland, this Section 7 is deemed to include the additional statements set forth in Sections 11.5 and 11.6.<br />8. Exclusive Remedy; Dismissal of Action; Jurisdiction of Court.<br />8.1. Except as otherwise provided in this Agreement, this Agreement shall be the sole and exclusive remedy for any and all claims of Settling States released hereby against the Settling Defendants, and upon the date a Settling State becomes bound by this Agreement, each such Settling State shall be barred from initiating, asserting, or prosecuting any claims released hereby against each such Settling Defendant.<br />8.2. Promptly after each Settling State becomes bound by this Agreement, each such Settling State shall dismiss without prejudice its corresponding Attorney General Action as against such Settling Defendant, or if defendants have not yet responded to a complaint, the Settling State may amend the complaint to delete the Settling Defendant from the Action.<br />8.3. Promptly after the date each Settling State becomes bound by this Agreement, each such Settling Defendant shall withdraw without prejudice from any action brought against any Settling State with respect to claims released hereby.<br />9. Term.<br />9.1. Unless earlier terminated in accordance with the provisions of this Agreement, the duration of this Agreement shall be twenty-five (25) years from the date of this Agreement; provided that in the event of a Global Settlement, the duration of this Agreement shall be equal to the duration of the Global Settlement.<br />9.2. Each Settling Defendant shall have the right to terminate this Agreement with respect to that Settling Defendant and with respect to the Settling State in which there is a full and final dismissal on the merits as to any of the Non-settling Tobacco Companies in that Settling State's Attorney General Action; provided that in the event of any such termination, the payments due from such Settling Defendant pursuant to this Agreement shall be thereafter reduced by an amount equal to the product of (a) the total amount of the Settlement Fund allocated to all of the Settling States at the time of such dismissal and (b) a quotient equal to the Medicaid Population of such Settling State at the time of such dismissal divided by the total Medicaid Population of all Settling States at the time of such dismissal); provided further that any and all payments made pursuant to this Agreement prior to any such termination by such Settling Defendant shall be retained by the Settlement Fund. The Attorneys General shall provide the Settling Defendant with the information necessary to determine the amount referred to in subpart (a) hereof. Termination under this section does not in any fashion reduce Settling Defendants' obligations in any other Attorney General Actions.<br />9.3. Each Settling Defendant shall have the right at any time during the term of this Agreement to terminate this Agreement with respect to such Settling Defendant in the even that, in its sole and exclusive discretion, it determines that too many states have opted out of the Mandatory Settlement Class and have not resolved such cases with respect to the Settling Defendant by becoming bound by this Agreement in accordance with the terms hereof; provided that such Settling Defendant give written notice of such termination to the Attorneys General of the Settling States and provided further that any and all payments due up to the date of such termination made pursuant to this Agreement prior to the giving of such notice by such Settling Defendant must be exercised no later than sixty days after the date that Settling Defendants determine how many states have opted out of the Mandatory Settlement Class.<br />9.4. In the event of a termination of this Agreement with respect to any Settling State, such Settling Defendant shall be entitled to offset any payments made to such Settling State prior thereto against any judgments thereafter obtained by such Settling State against such Settling Defendant in an Attorney General Action.<br />9.5. If any Settling Defendant subsequently withdraws from this Agreement, or this Agreement, for whatever reason, is terminated other than by reason of expiration of its term, then the applicable statue of limitations or any similar time requirement for a Settling State or a terminating Settling Defendant to file a claim that would otherwise be released hereunder against, or by any Settling Defendant shall be tolled from the date such Settling State became bound by this Agreement until the later of the time permitted by applicable law or for one year from the date of such termination with the effect that the parties shall be in the same position as they were at the time the Settling State filed its original Attorney General action with respect to the statute of limitations.<br />9.6. Except as may be otherwise specifically provided in this Agreement, a termination by a Settling Defendant hereunder shall have the effect of rendering this Agreement as having no force or effect whatsoever, null and void ab initio, and not admissible as evidence for any purpose in any pending or future litigation in any jurisdiction. However, a termination shall not affect any prior cooperation or require the return of any document produced to a Settling State pursuant to this Agreement.<br />10. Continuing Enforceability<br />Unless earlier terminated, as to the Settling States, this Agreement and each provision of or obligation arising from this Agreement shall continue and remain fully executory and enforceable if a Settling Defendant institutes or is subject to the institution against it of any proceeding or voluntary case under title 11, United States Code, or other proceeding seeking to adjudicate it insolvent or seeking liquidation, winding up, reorganization, arrangement adjustment, protection, relief or composition of it or its debts under any law relating to bankruptcy, insolvency or reorganization or relief or protection of debtors or other proceeding seeking the entry of an order for relief or the appointment of a receiver, trustee, custodian or other similar official for it or for any part of its property (each, a "Bankruptcy Proceeding"). The Settling States acknowledge and agree that Brooke Group has the right but not the obligation to cure and to perform any and all obligations of Liggett under this Agreement notwithstanding the occurrence and continuation of any Bankruptcy Proceeding with respect to Liggett; provided, however, that until such time as Liggett decides whether to reject or assume this Agreement, Brooke Group shall have the obligation to pay the annual installments as provided in Section 6.3.2 hereof, and so long as the Brooke Group is paying all amounts due hereunder and so such payments are voidable, then the Settling States waive any and all rights they may have not to accept such cure or performance in any Bankruptcy Proceeding.<br />11. Entry of Good Faith Bar Order on Contribution and Indemnity Claims<br />11.1. It is the intent of the parties that the payments to be made by Liggett with respect to the Attorneys General Actions settled hereby, be limited to those payments set forth in this Settlement Agreement and that the Settling Defendants not be responsible for any payments relating to any contribution or indemnity claim asserted, or to be asserted, by any non-settling defendant that may arise from any such Attorneys General Actions. It is further the intent of the parties to this Agreement that in Minnesota and Wisconsin the release of the Settling Defendants and any rights of non-settling defendants to contribution or indemnity shall be construed as a Pierringer release, as used in Pierringer v. Roger, 21 Wisc. 2d 182, 124 N.W.2d 106 (1963); Frey v. Snelgrove, 269 N.W.2d 918 (Minn. 1978). In order to effectuate such intent, the parties agree as follows in this Section 11.<br />11.2. Subject to, and as promptly as reasonably practicable, under applicable law, the Parties shall request that the respective courts in the Attorney General Actions enter orders barring and prohibiting the commencement and prosecution of any claim or action by any non-settling defendant against any Settling Defendant, including but not limited to any contribution, indemnity, and/or subrogation claim seeking reimbursement for payments made or to be made to any Settling State for claims settled under this Agreement. Settling Defendants shall be entitled to dismissal with prejudice of any non-settling defendants’ claims against them which violate or are inconsistent with this bar, if granted.<br />11.3. The Settling States shall not seek to collect any amount on any judgment against a son-settling defendant to the extent, and only to the extent, that such non-settling defendant has a right under applicable law of contribution or indemnification against the Settling Defendants. This section will not apply to any agreement or understanding, known or unknown, written or otherwise, with any non-settling defendant or any other party that entitles any non-settling defendant to indemnity or contribution from Brooke Group or Liggett.<br />11.4. Should a Settling State receive a final monetary judgment against a non-settling defendant which then results in the non-settling defendant being legally entitled to require a Settling Defendant to make payment toward that judgment, the Settling States shall seek Court approval to reduce the judgment by an amount sufficient to result in the Settling Defendant having non obligation toward the judgment.<br />11.5. The provisions of Sections 11.1 – 11.4 apply to all States except for the State of Maryland. With respect to the State of Maryland only, the State of Maryland shall, upon entering into this Agreement, execute a release of Settling Defendants which shall state, among other things provide for in this Agreement: "In the event of a verdict against non-settling defendants in this Action, and in the event that with respect to such verdict, any settling defendant is adjudicated a joint tortfeasor in any manner in this Action, there shall be a judgment reduction from such verdict accounting for the status of Settling Defendants as a joint tortfeasor in the amount of $ [the Present Value of Settling Defendants’ total aggregate payments allocable to the State of Maryland as calculated pursuant to provisions of the Attorneys General Settlement Agreement]. It is the intention of the parties that this Release provide for a pro tanto reduction of any damages recoverable against all other tortfeasors in this action, and only if Settling Defendants, or any of them, are adjudicated a joint tortfeasor. This Release does not provide, and shall not be construed to provide, for a reduction, to the extent of the pro rate share of Settling Defendants, or any of them, of the damages recoverable in this action against all other tortfeasors. If a judgment reduction occurs on a pro tanto basis as provided in this Release and if a non-settling joint tortfeasor pays more than its pro rata share of the judgment, that tortfeasor shall receive that portion of any future payment made thereafter by Settling Defendants in accordance with the Attorneys General Settlement Agreement that is (1) beyond the amount of the pro tanto setoff provided for in this Release, and (2) attributable to that part of claims against that joint tortfeasor for which Settling Defendants are jointly and severally liable."<br />11.6. With respect to State of Maryland only, the Attorney General of Maryland shall cause a competent appraiser to make a calculation of Present Value of Settling Defendants’ total aggregate payments allocable to the State of Maryland as provided for under this Settlement Agreement, which valuation is referenced and bracketed in Section 11.4 hereof. Such calculation of Present Value of payment allocable to the State of Maryland under this Agreement shall be the amount stated in the bracketed portion of the language quoted in Section 11.4 above.<br />12. Tax Status of Settlement Fund<br />12.1. The Settlement Fund created under this Agreement will be established and maintained as a Qualified Settlement Fund ("QSF") in accordance with Section 468B of the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder. Any Settling Defendant shall be permitted, in its discretion, and at its own cost, to seek a private letter ruling from the Internal Revenue Service ("IRS") regarding the tax status of the Settlement Fund. The parties agree to negotiate in good faith any changes to the Agreement which may be necessary to obtain IRS approval of the Settlement Fund as a QSF.<br />12.2. Representatives of the Settling States and the Settlement Class will be appointed to act as administrator of the Settlement Fund. As administrator, such representatives will undertake the following actions in accordance with the regulations under IRC section 468B: (a) apply for the tax identification number required for the Attorney General Settlement Fund; (b) file, or cause to be filed, all tax returns the Settlement Fund is required to file under federal of state laws; (c) pay from the Settlement Fund all taxes that are imposed upon the Settlement Fund by federal or state laws; and (d) file, or cause to be filed, tax elections available to the Settlement Fund, including a request for a prompt assessment under IRC sec. 6501(d), if and when the administrator deems it appropriate to do so.<br />12.3. The Settling Defendants, as transferors of the Settlement Fund shall prepare and file the information statements concerning their settlement payments to the Settlement Fund as required to be provided to the IRS pursuant to the regulations under IRC section 468B.<br />13. Effect of a Default of Settling Defendant<br />In the event a Settling Defendant fails to make a payment due and owing under the terms of this Agreement, or is in default of this Agreement in any other respects, Plaintiffs’ Counsel shall so notify the defaulting Settling Defendant, which shall then be given 60 calendar days to "cure" the default. If the defaulting Settling Defendant does not "cure" the default in the time provided in this Section 13, Plaintiffs’ Counsel may apply to the Court for relief, in addition to any other remedies it may have hereunder.<br />14. Representations and Warranties.<br />14.1. Each Settling Defendant represents and warrants that it (i) has all requisite corporate power and authority to execute, deliver and perform this Agreement and to consummate the transactions contemplated hereby; (ii) the execution, delivery and performance by such Settling Defendant of this Agreement and the consummation by it of the actions contemplated herein have been duly authorized by all necessary corporate action on the part of such Settling Defendant; (iii) the Agreement has been duly executed and authorized by such Settling State and constitutes its legal, valid and binding obligation.<br />15. Arbitration<br />In the event that the Parties are unable to agree, after good faith efforts, as to the determination or calculation for any applicable year of Market Share or Pretax Income hereunder, such determination or calculation shall be submitted to binding arbitration in accordance with the rules of the American Arbitration Association.<br />16. Most Favored Nation<br />16.1. It is the intent of the parties hereto that the Settling Defendants enjoy a preferred position with respect to Non-Settling Tobacco Companies, in recognition of the Settling Defendants’ willingness to enter into this agreement. Accordingly, it is generally contemplated that settlements which involve all Settling States and a Non-Settling Tobacco Company (a "Group Other Settlement") or involving one Settling State and a Non-Settling Tobacco Company (a "Single State Other Settlement") shall meet certain minimum requirements in terms of the initial, periodic or lump sum payments to be made by the Non-Settling Tobacco Company (each a "Benchmark Figure"). The recital of these Benchmark Figures herein is solely for the purposes of insuring that the Settling Defendants enjoy a preferred position with respect to Non-Settling Tobacco Companies and is not intended in any way to reflect the value of the Settling States claims against Non-Settling Tobacco Companies, and nothing in this Agreement is intended to reflect the value of those claims. For purposes of this Section 16, a settlement involving a Non-Settling Tobacco Company and some, but not all, Settling States shall be deemed a Single Other Settlement, and the preferred position of the Settling Defendant shall be governed by Subsections 16.1.3 and 16.1.4 hereof, and determined on a state-by-state basis.<br />16.1.1. In the case of a Group Other Settlement which includes and initial payment such as that provided for in Section 6.3.1 hereof, the Benchmark Figure shall be that figure which represents three times the Present Value of the initial payment made hereunder, adjusted for the Market Share at the time of such payment. Thus, if at the time of the initial payment hereunder, the Settling Defendant had a market share of 2 percent and made a payment the Present Value of which has a market share of 10 percent the Benchmark Figure for the initial payment actually provided for in such Group Other Settlement is less than the Benchmark Figure, the Settling defendant shall receive a credit in like amount, up to the amount of the present value of the initial payment made hereunder, against all future payment obligations hereunder.<br />16.1.2. In the case of a (i) Group Other Settlement which included only a lump sum or periodic payments, and (ii) with respect to the periodic payments included in a Group Other Settlement which also includes an initial payment, the Benchmark figure shall be that amount which constitutes three times the Present Value of all amounts paid or payable by the Settling Defendant hereunder (excluding, if the Group Other Settlement contains an initial payment, the initial payment hereunder), assuming, in the case of future payments, no increase or decrease in Market Share but assuming Inflation in revenues, all adjusted for Market Share. Thus, if the Present Value of a Settling Defendant's payments made or to be made hereunder is $60 million and such Settling Defendant enjoys a Market Share of 2%, the Benchmark Figure for a non-settling defendant which at the time of a Group Other Settlement enjoys a Market Share of 15% would be $1,350 million. Similarly, the Benchmark Figure for a Non-Settling Defendant which at the time of a Group Other Settlement enjoys a Market Share of 5% would be $450 million. To the extent that the Present Value of the lump sum or periodic payments to be made under a Group Other Settlement is less than the Benchmark Figure, the Settling Defendant shall receive a credit in like amount, up to the amount of any remaining payment obligations hereunder.<br />16.1.3. In the case of a Single State Other Settlement which includes an initial payment such as that provided for in Section 6.3.2 hereof, the Benchmark Figure shall be that figure which represents three times the Present Value of the initial payment made hereunder to such Settling State, adjusted for Market Share at the time of such payment, computer in accordance with Section 16.1.1. To the extent that the initial payment actually provided for in such Single State Other Settlement is less than the Benchmark Figure, the Settling Defendant shall receive a credit in like amount, up to the amount of the present value of the initial payment made to the Settling State hereunder, against all future payment obligations to the Settling State hereunder.<br />16.1.4. In the case of a Single Other Settlement which includes only a lump sum or periodic payments, and with respect to the periodic payments included in a Single State Other Settlement which also includes an initial payment, the Benchmark Figure shall be that amount which constitutes three times the Present Value of all amounts paid or payable by the Settling Defendant to the Settling State hereunder (excluding, if the Single State Other Settlement contains an initial payment, the Initial Payment hereunder), assuming, in the case of future payments, no increase or decrease in Market Share, computed as set forth in Section 16.1.2. To the extent that the Present Value of the lump sum or periodic payments to be made under a Single State Other Settlement is less than the Benchmark Figure, the Settling Defendant shall receive a credit in like amount, up to the amount of any remaining payment obligations to the Settling State hereunder.<br />16.1.5. Solely for the purpose of Section 16.1, the payments due to each of the Settling States in a year shall be deemed be equivalent to the product of (a) 10% of the Settling Defendant's Pretax Income and (b) a quotient equal to the Medicaid Population of the Settling State divided by the total Medicaid Population of all Settling States.<br />16.1.6. The Benchmark Figure set forth in Sections 16.1.1 - 16.1.4 does not reflect in any fashion the Settling States' views as to an appropriate settlement or resolution with any Non-Settling Tobacco Company.<br />16.2. Except as provided in Section 16.1 hereof, in the event that, subsequent to the date of this Agreement, any settlement of any Settling State's Attorney General Action is reached with any non-settling defendant which is not a Party hereto and such settlement is on any terms more favorable to such non-settling defendant than are the terms of this Agreement to a Settling Defendant, such Settling Defendant shall each have the right to replace or modify any or all of the terms of this Agreement with, or add to this Agreement, any or all such more favorable terms.<br />16.3. In the event that, subsequent to the date of this Agreement, any of the Settling Defendants enters into a settlement agreement with any State other than a Settling State on terms (relating to the then Present Value of amounts payable under such settlement agreement, compliance with the Proposed Rule or cooperation) that are more favorable to the State than those contained herein (as adjusted for relative Medicaid Population), the Settling States shall have the right with respect to such Settling Defendant to replace or modify any or all of the terms of this Agreement with, or add to this Agreement, any or all such more favorable terms (adjusted for relative Medicaid Populations).<br />17. Future Affiliate<br />17.1 The terms of this Agreement shall not be binding upon or applicable to a Future Affiliate of the Settling Defendants, except as provided for in this Section 17.<br />17.2 (a) In the event of a Future Affiliate Transaction, the Settling States shall not seek to enjoin or otherwise challenge a spinoff or like disposition of the stock or assets of any Affiliate of the Future Affiliate which is not engaged in Domestic Tobacco Operations. The Settling States reserve the right to seek to enjoin such a spinoff in the event that such spinoff or like disposition is sought by someone other than Brooke Group or a Future Affiliate or an Affiliate of a Future Affiliate.<br />(b) In the event of and after a Future Affiliate Transaction: (i) the Settling States each release (pursuant to, mutatis mutandis, Section 7.1 hereof), and covenant not to bring suit for any claim so released against any Affiliate of the Future Affiliate, other than the Affiliate engaged in Domestic Tobacco Operations; and (ii) if prior to the Future Affiliate Transaction, a Settling State shall have obtained a verdict or judgment in its Attorney General Action, against an Affiliate (including the Parent) of the Future Affiliate, other than against the Affiliate engaged in Domestic Tobacco Operations, such Settling State shall not seek to enforce such verdict or judgment against any such Affiliate other than the Affiliate engaged in Domestic Tobacco Operations.<br />17.3. In the event a Settling State obtains a verdict or judgment against a Non-settling Tobacco Company in an Attorney General Action, and a Settling Defendant commences a proxy contest or similar action seeking control of such Non-settling Tobacco Company or an Affiliate thereof, then such Non-settling Tobacco Company or an Affiliate thereof will not be required to post a bond in order to stay enforcement of such verdict or judgment, and such Settling State will not seek to enforce such verdict or judgment against such Non-settling Tobacco Company or such Affiliate, for a period of the earlier of (i) one year from the commencement of such proxy contest or action, and (ii) completion or resolution of the proxy or merger vote.<br />17.4. In the even that subsequent to a Future Affiliate Transaction, and in conformity with § 17.2(b) hereof, a Settling State obtains a verdict or judgment against a Future Affiliate in an Attorney General Action, such Future Affiliate will not be required to post a bond in order to stay enforcement of such verdict or judgment, and such Settling State will not seek to enforce such judgment against such Future Affiliate or an Affiliate of such Future Affiliate until the verdict or judgment becomes final and non-appealable.<br />17.5. Prior to a Future Affiliate Transaction, Settling Defendants shall not enter into any agreement with any prospective Future Affiliate which diminishes or impairs the prospective Future Affiliate's assets, other than in the established and/or ordinary course of business of such prospective Future Affiliate from diminishing or impairing such assets. In the event of a Future Affiliate Transaction, Settling States reserve all of their rights to prevent the Future affiliate from diminishing or impairing the Future Affiliate's Tobacco assets, other than in the established and/or ordinary course of business of such Future Affiliate.<br />17.6. With respect to subsections 17.1 - 17.5 above, nothing in these provisions, or elsewhere in this Agreement, limits the authority of the Attorneys General to challenge any transaction which they reasonably believe is in violation of federal or state antitrust law.<br />17.7. In the event of a Future Affiliate Transaction after which Liggett remains as a separate entity such that Liggett's Pretax Income is readily calculable, Section 6.3.2 hereof shall remain in effect with respect to Pretax Income solely attributable to such separate entity. In the event of a Future Affiliate Transaction, Settling Defendants and the Attorneys General and their respective counsel, each agree to exercise best efforts to negotiate in good faith a payment schedule to replace that set forth in Section 6.3.2. Nothing in this Section 17.7 affects in any way Liggett's payment obligations under Section 6.3.1 hereof.<br />17.8. Promptly after a Future Affiliate Transaction, a Future Affiliate shall abide by Sections 4.4 - 4.7 hereof.<br />17.9. Promptly after a Future Affiliate Transaction, Settling Defendants and the Attorneys General and their respective counsel, each agree to exercise best efforts to negotiate in good faith a settlement of all Attorney General Actions against a Future Affiliate's Domestic Tobacco Operations.<br />17.9. As promptly as reasonably practicable after a Future Affiliate Transaction, a Future Affiliate shall agree to eliminate cartoon characters such as "Joe Camel," from all of its advertising and promotional materials and activities with respect to tobacco products.<br />18. Miscellaneous<br />18.1 All terms of this Agreement and/or obligations created thereby shall be deemed to include a covenant of good faith and fair dealing on behalf of all parties.<br />18.2. Brooke Group shall provide to the Settling States at the time of execution of this Agreement, an opinion in form satisfactory to the Settling States from legal counsel for the Brooke Group as to the due execution of the Settlement Agreement by the Brooke Group and Liggett and its enforceability against the Brooke Group and Liggett and such other matters contemplated by Section 14.1 (other than the "agreements" referenced in clause (iv)).<br />18.3. In the event that a termination occurs pursuant to any sections of this Agreement, no Settling State shall be required to return any payment.<br />18.4. Subject to the provisions of Section 18 herein, this Agreement, including all Appendices attached hereto, if any, shall constitute the entire Agreement among the parties with regard to the subject of this Agreement and shall supersede any previous agreement and understandings between the Parties with respect to the subject matter of this Agreement. This Agreement may not be changed, modified, or amended except in writing signed by all Parties.<br />18.5. With respect to each Settling State, this Agreement shall be construed under and governed by the laws of such State applied without regard to its laws applicable to choice of law.<br />18.6. This Agreement may be executed by the Parties in one or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.<br />18.7. Any judgment by a court that any provision of this Agreement, as applied to any party or to any circumstance, is invalid or unenforceable shall in no way affect any other provision of this Agreement or the application thereof in any other circumstance, and such provision so adjudged invalid or unenforceable shall be enforced to the maximum extent permitted by law.<br />18.8. This Agreement shall be binding upon and inure to the benefit of the Settling States, the Settling Defendants, and their representatives, heirs, successors, and assigns.<br />18.9. Nothing in this Agreement shall be construed to subject any Settling Defendant's parent or affiliated company to the obligations or liabilities of that Settling Defendant.<br />18.10. The headings of the Sections of this Agreement are included for convenience only and shall not be deemed to constitute part of this Agreement or to affect its construction.<br />18.11. Any notice, request, instruction, or application for Court orders sought in connection with this Agreement or other document to be given by any Party to any other Party shall be in writing and delivered personally or sent by registered or certified mail, postage prepaid, if to the Settling Defendants to the attention of each Settling Defendant's respective representative and to Plaintiffs' Counsel on behalf of the Settling States.<br />18.12. References to or use of a singular noun or pronoun in this Agreement shall include the plural, unless the context implies otherwise.<br />IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and date first written above.<br />BROOKE GROUP LTD<br />By Bennett S. LeBow<br />LIGGETT GROUP, INC.<br />By Bennett S. LeBow<br />Signed, 3/20/97<br />KASOWITZ, BENSON, TORRES & FRIEDMAN<br />Marc E. Kasowitz<br />Signed, 3/20/97<br />Attorneys for BROOKE GROUP LTD. and LIGGETT GROUP, INC.<br />STATE OF ARIZONA<br />Grant Woods, Attorney General<br />Signed, 3/20/97<br />STATE OF CONNECTICUT<br />Richard Blumenthal, Attorney General<br />Signed, 3/20/97<br />STATE OF HAWAII<br />Margery Bronster, Attorney General<br />Signed, 3/20/97<br />STATE OF ILLINOIS<br />Jim Ryan, Attorney General<br />Signed, 3/20/97<br />STATE OF INDIANA<br />Jeffrey Modisett, Attorney General<br />Signed, 3/20/97<br />STATE OF IOWA<br />Tom Miller, Attorney General<br />Signed, 3/20/97<br />STATE OF KANSAS<br />Carla Stovall, Attorney General<br />Signed, 3/20/97<br />STATE OF MARYLAND<br />J. Joseph Curran, Attorney General<br />Signed, 3/20/97<br />STATE OF MICHIGAN<br />Frank Kelley, Attorney General<br />Signed, 3/20/97<br />STATE OF MINNESOTA<br />Hubert H. Humphrey, III, Attorney General<br />Signed, 3/20/97<br />STATE OF NEW JERSEY<br />Peter Verniero, Attorney General,<br />Signed, 3/20/97<br />STATE OF NEW YORK<br />Dennis Vacco, Attorney General<br />Signed, 3/20/97<br />STATE OF OKLAHOMA<br />Drew Edmondson, Attorney General<br />Signed, 3/20/97<br />STATE OF TEXAS<br />Dan Morales, Attorney General<br />Signed, 3/20/97<br />STATE OF UTAH<br />Jan Graham, Attorney General<br />Signed, 3/20/97<br />STATE OF WASHINGTON<br />Christine Gregoire, Attorney General<br />Signed, 3/20/97<br />STATE OF WISCONSIN<br />Jim Doyle, Attorney General<br />Signed, 3/20/97<br /><SPAN style="DISPLAY: none"><br /><br />Anahtar kelimeler<br />act settlement<br />case settlement<br />money settlement<br />selling settlement<br />settlement cases<br />settlement court<br />settlement law<br />settlement lawsuit<br />settlement litigation<br />tax settlement<br />taxes settlement<br />tobacco settlement<br />virginia settlement<br />against settlement<br 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settlement procedures act<br />the real estate settlement procedures act respa<br />tobacco settlement act<br />trust and settlement variation act<br />unfair claim settlement practices act<br />virginia wet settlement act<br />what is the act of settlement<br />Anahtar kelimeler<br />debt settlement<br />1986 act<br />act contrition<br />act government<br />act legislation<br />act mortgage<br />act parliament<br />act supremacy<br />australia settlement<br />credit settlement<br />employment act<br />insurance settlement<br />settlement law<br />tax settlement<br />1559 settlement<br />act settlements<br />act uniformity<br />alberta settlement<br />elizabeth settlement<br />nsw settlement<br />ontario settlement<br />settlement acts<br /><br /><br /><br /><br /></span>Settlementhttp://www.blogger.com/profile/07780234485860161985noreply@blogger.com0tag:blogger.com,1999:blog-8812498477003583262.post-1168599696639623012007-10-24T06:50:00.000-07:002007-10-24T06:53:02.129-07:00PROPOSED RESOLUTIONPROPOSED RESOLUTION<br /><a name="PREAMBLE"></a>PREAMBLE<br />This legislation would mandate a total reformation and restructuring of how tobacco products are manufactured, marketed and distributed in this country. The nation can thereby see real and swift progress in preventing underage use of tobacco, addressing the adverse health effects of tobacco use and changing the corporate culture of the tobacco industry.<br />The Food and Drug Administration ("FDA") and other public health authorities view the use of tobacco products by our nation's children as a "pediatric disease" of epic and worsening proportions that results in new generations of tobacco dependent children and adults. There is also a consensus within the scientific and medical communities that tobacco products are inherently dangerous and cause cancer, heart disease and other serious adverse health effects.<br />The FDA and other health authorities have concluded that virtually all new users of tobacco products are under legal age. President Clinton, the FDA, the Federal Trade Commission ("FTC"), state Attorneys General and public health authorities all believe that tobacco advertising and marketing contribute significantly to the use of nicotine-containing tobacco products by adolescents. These officials have concluded that because past efforts to restrict advertising and marketing have failed to curb adolescent tobacco use, sweeping new restrictions on the sale, promotion and distribution of such products are needed.<br />Until now, federal and state governments have lacked many of the legal means and resources they need to address the societal problems caused by the use of tobacco products. These officials have been armed only with crude regulatory tools which they view as inadequate to achieve the public health objectives with which they are charged.<br />This legislation greatly strengthens both the federal and state governments' regulatory arsenal and furnishes them with additional resources needed to address a public health problem that affects millions of Americans, including most importantly underage tobacco use. Further, it is contemplated that certain of the obligations of the tobacco companies will be implemented by a binding, enforceable contractual protocol.<br />The legislation reaffirms individuals' right of access to the courts, to civil trial by jury and to full compensatory damages. Resolution through the Act of potential punitive damages liability of the tobacco industry for past conduct is only made in the context of the comprehensive settlement proposed by the legislation. It is not intended to have precedential effect, nor does it express any position adverse to the imposition of punitive damages in general or as applied to any other specific industry, case, controversy or product and does not provide any authority whatsoever regarding the propriety of punitive damages.<br />Among other things, the new regime would:<br />-- Confirm FDA's authority to regulate tobacco products under the Food, Drug and Cosmetic Act, making FDA not only the preeminent regulatory agency with respect to the manufacture, marketing and distribution of tobacco products but also requiring the tobacco industry to fund FDA's oversight out of ongoing payments by the manufacturers pursuant to the new regime ("Industry Payments").<br />-- Go beyond FDA's current regulations to ban all outdoor tobacco advertising and to eliminate cartoon characters and human figures, such as Joe Camel and the Marlboro Man, two tobacco icons which the public health community has long assailed as advertising appealing to our nation's youth.<br />-- Impose and provide funding out of the Industry Payments for an aggressive federal enforcement program, including a State-administered retail licensing system, to stop minors from obtaining tobacco products, while in no way preventing the States from enacting additional measures.<br />-- Ensure that the FDA and the States have the regulatory flexibility to address issues of particular concern to public health officials, such as youth tobacco usage and tobacco dependence.<br />-- Subject the tobacco industry to severe financial surcharges in the event underage tobacco use does not decline radically over the next decade.<br />-- Empower the federal government to set national standards controlling the manufacturing of tobacco products and the ingredients used in such products.<br />-- Provide new and flexible regulatory enforcement powers to ensure that the tobacco industry works to develop and introduce less-hazardous tobacco products," including, among other things, vesting FDA with the power to regulate the levels of nicotine in tobacco products.<br />-- Require the manufacturers of tobacco products to disclose all previously non-public internal laboratory research and all new internal laboratory research generated in the future relating to the health effects or safety of their products.<br />-- Establish a minimum federal standard with tough restrictions on smoking in public places with enforcement funding from the Industry Payments, while preserving the authority of state and local governments to enact even more severe standards.<br />Authorize and fund from Industry Payments a $500 million annual, national education-oriented counter-advertising and tobacco control campaign seeking to discourage the initiation of tobacco use by children and adolescents and to encourage current tobacco product users to quit use of the products.<br />-- Authorize and fund from Industry Payments the annual payment to all States of significant, ongoing financial compensation to fund health benefits program expenditures and to establish and fund a tobacco products liability judgments and settlement fund.<br />-- Authorize and fund from Industry Payments a nationwide program, administered through State governments and the private sector, of smoking cessation.<br />The sale of tobacco products to adults would remain legal but subject to restrictive measures to ensure that they are not sold to underage purchasers. These measures respond directly to concerns voiced by federal and state public health officials, the public health community and the public at large that the tobacco industry should be subject to the strictest scrutiny and regulatory oversight. This statute imposes regulatory controls, including civil and criminal penalties, equal to, and in many respects exceeding, those imposed on other regulated industries. Further, it imposes on tobacco manufacturers the obligation to provide funding from Industry Payments for an array of public health initiatives.<br />The sale, distribution, marketing, advertising and use of tobacco products are activities substantially affecting interstate commerce. Such products are sold, marketed, advertised and distributed in interstate commerce on a nationwide basis, and have a substantial effect on the nation's economy. The sale, distribution, marketing, advertising and use of such products are also activities substantially affecting interstate commerce by virtue of the health care and other costs that federal and State governmental authorities have attributed to usage of tobacco products.<br />Various civil actions are pending in state and federal courts arising from the use, marketing or sale of tobacco products. Among these actions are cases brought by some 40 state Attorneys General, cases brought by certain cities and counties, the Commonwealth of Puerto Rico, and other third-party payor cases seeking to recover monies spent treating tobacco-related diseases and for the protection of minors and consumers. Also pending in courts throughout the United States are various private putative class action lawsuits brought on behalf of individuals claiming to be dependent upon and injured by tobacco products. Additionally, a multitude of individual suits have been filed against the tobacco products manufacturers and/or their distributors, trade associations, law firms and consultants.<br />All of these civil actions are complex, slow-moving, expensive and burdensome, not only for the litigants but also for the nation's state and federal judiciaries. Moreover, none of those litigation's has to date resulted in the collection of any monies to compensate smokers or third-party payors. Only national legislation offers the prospect of a swift, fair, equitable and consistent result that would serve the public interest by (1) ensuring that a portion of the costs of treatment for diseases and adverse health effects linked to the use of tobacco products is borne by the manufacturers of these products, and (2) restricting nationwide the sale, distribution, marketing and advertising of tobacco products to persons of legal age. The unique position occupied by tobacco in the nation's history and economy, the magnitude of actual and potential tobacco-related litigation, the need to avoid the cost, expense, uncertainty and inconsistency associated with such protracted litigation, the need to limit the sale, distribution, marketing and advertising of tobacco products to persons of legal age, and the need to educate the public, especially young people, of the health effects of using tobacco products all dictate that it would be in the public interest to enact this legislation to facilitate a resolution of the matters described.<br />Public health authorities believe that the societal benefits of this legislation, in human and economic terms, would be vast. In particular, FDA has found that reducing underage tobacco use by 50% "would prevent well over 60,000 early deaths." FDA has estimated that the monetary value of its present regulations will be worth up to $43 billion per year in reduced medical costs, improved productivity and the benefit of avoiding the premature death of loved ones. This statute, which extends far beyond anything FDA has previously proposed or attempted, can be expected to produce human and economic benefits many times greater than such existing regulations.<br />As part of this settlement, the tobacco companies recognize the historic changes that will be occurring to their business. They will fully comply with increased federal regulation, focus intense efforts on dramatic reductions in youth access and youth tobacco usage, recognize that the regulatory scheme encourages the development of products with reduced risk and acknowledge the predominant public health positions associated with the use of tobacco products.<br />[Source/precedent: FDA Rule]<br /><a name="toc"></a>Contents<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#PREAMBLE">Preamble</a><br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#TitleI">Title I</a>: Reformation of the Tobacco Industry<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#Ia">A</a>. Restrictions on Marketing and Advertising<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#Ib">B.</a> Warnings, Labeling and Packaging<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#Ic">C.</a> Restrictions on Access to Tobacco Products<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#Id">D.</a> Licensing of Retail Tobacco Product Sellers<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#Ie">E.</a> Regulation of Tobacco Product Development and Manufacturing<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#If">F.</a> Non-tobacco Ingredients<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#Ig">G.</a> Compliance and Corporate Culture<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#Ih">H.</a> Effective Dates<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#TITLEII">Title II:</a> "Look Back" Provisions/State Enforcement Incentives<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#TITLEIII:">Title III:</a> Penalties and Enforcement; Consent Decrees; Non-Participating Companies<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#IIIa">A. </a>Penalties and Enforcement<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#IIIb">B.</a> Consent Decrees<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#IIIc">C.</a> Non-participating Companies<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#TitleIV:">Title IV:</a> Nationwide Standards to Minimize Involuntary Exposure to Environmental Tobacco Smoke<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#TITLEV:">Title V:</a> Scope and Effect<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#Va">A. </a>Scope of FDA Authority <a href="http://stic.neu.edu/settlement/6-20-settle.htm#Vb">B. </a>State Authority<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#TITLEVI:">Title VI: </a>Programs/Funding<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#VIa">A. </a>Up Front Commitment<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#VIb">B. </a>Base Annual Payments<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#VIc">C.</a> Applicability<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#VId">D.</a> Tax Treatment<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#TITLEVII:">Title VII:</a> Public Health Funds From Tobacco Settlement As Recommended by The Attorneys General For Consideration by the President and the Congress<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#TITLEVIII:">Title VIII:</a> Civil Liability<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#VIIIa">A. </a>General<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#VIIIb">B. </a>Provisions as to Civil Liability for Past Conduct<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#VIIIc">C. </a>Provisions as to Civil Liability for Future Conduct<br /><a href="http://stic.neu.edu/c:/Netscape/Server/stic/settlement/6-20-settle.htm#TITLEIX:">Title IX: </a>Board Approval<br />Appendices:<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#AppendixI">Appendix I: </a>Warnings in Advertisements<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#AppendixII">Appendix II:</a> Retail Tobacco Product Seller Penalties<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#AppendixIII">Appendix III:</a> Application to Indian Tribes<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#AppendixIV">Appendix IV:</a> Industry Associations<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#AppendixV">Appendix V:</a> "Look Back"<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#Appendix">Appendix VI:</a> State Enforcement Incentives<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#AppendixVII">Appendix VII: </a>Restrictions on Point of Sale Advertising<br /><a href="http://stic.neu.edu/settlement/6-20-settle.htm#AppendixVIII">Appendix VIII:</a> Public Disclosure of Past and Future Tobacco Industry Documents and Health Research<br /><a name="TitleI"></a>TITLE I: Reformation Of The Tobacco Industry<br />Title I of the legislation would incorporate and expand upon FDA's recent regulation of nicotine-containing tobacco products.<br />The following rules would apply to all tobacco products sold in the U.S. (including all its territories and possessions, as well as duty-free shops within U.S. borders). The new regime would be allowed to operate as described below for five years. FDA would have authority to make revisions even within this period under extraordinary circumstances. Thereafter, the FDA would be authorized to review and revise the rules under applicable Agency procedures.<br /><a name="Ia"></a>A. Restrictions on Marketing and Advertising<br />The advertising and marketing of tobacco products would be drastically curtailed, including in ways that exceed the FDA rule as originally promulgated and in ways that have previously been challenged on First Amendment grounds. As in the FDA rule the new regime would:<br />-- Prohibit the use of non-tobacco brand names as brand names of tobacco products except for tobacco products in existence as of January 1,1995 (897.16(a)) (The citations in this and in the next section are to Part 897 of the FDA's tobacco regulations, 61 Fed. Reg. 44396 (August 28, 1996).<br />-- Restrict tobacco product advertising to FDA specified media (897.30(a)(1 )-(2))<br />-- Restrict permissible tobacco product advertising to black text on a white background except for advertising in adult-only facilities and in adult publications (897.32(a)-(b))<br />-- Require cigarette and smokeless tobacco product advertisements to carry the FDA-mandated statement of intended use ("Nicotine Delivery Device") (897.32(c))<br />-- Ban all non-tobacco merchandise, including caps, jackets or bags bearing the name, logo or selling message of a tobacco brand (897.34(a)).<br />-- Ban offers of non-tobacco items or gifts based on proof of purchase of tobacco products (897.34(b))<br />-- Ban sponsorships, including concerts and sporting events, in the name, logo or selling message of a tobacco brand (897.34(c))<br />Further, building on and going beyond the FDA rule, the new regime would:<br />-- Ban the use of human images and cartoon characters - thereby eliminating Joe Camel and the Marlboro Man - in all tobacco advertising and on tobacco product packages<br />-- Ban all outdoor tobacco product advertising, including in enclosed stadia as well as brand advertising directed outside from a retail establishment (modifies 897.30(a)(1) and extends 897.30(b))<br />-- Prohibit tobacco product advertising on the Internet unless designed to be inaccessible in or from the United States<br />-- Establish nationwide restrictions in non adult-only facilities on point of sale advertising with a view toward minimizing the impact of such advertising on minors. These provisions, which are detailed in Appendix VII, restrict point of sale advertising that was otherwise permitted in retail establishments by the FDA rule.<br />-- Ban direct and indirect payments for tobacco product placement in movies, television programs and video games<br />-- Prohibit direct and indirect payments to "glamorize" tobacco use in media appealing to minors, including recorded and live performances of music -- Without limiting the FDA's normal rulemaking authority in this area, require that the use, in both existing and future brand styles, of words currently employed as product descriptors (e.g., "light" or "low tar") be accompanied by a mandatory disclaimer in advertisements (e.g., "Brand X not shown to be less hazardous than other cigarettes"); exemplars of all new advertising and tobacco products labeling shall be submitted to FDA concurrently with their introduction into the marketplace for FDA's ongoing review.<br />[Source/precedent: FDA Rule; 21 C.F.R. 101.70]<br /><a name="Ib"></a>B. Warnings, Labeling and Packaging<br />The federally-mandated warning labels on cigarettes were last changed in 1984. Since then a number of countries, including Canada and members of the European Union, have imposed new warning labels. Further, the Federal Trade Commission's methodology to measure the "tar" and nicotine yields of cigarettes has been criticized as producing misleading information.<br />1. The legislation, through amendments to the Federal Cigarette Labeling and Advertising Act and the Comprehensive Smokeless Tobacco Health Education Act, would mandate new rotating warnings, to be introduced concurrently into the distribution chain on all tobacco product packages and cartons, and to be rotated quarterly in all advertisements. For cigarettes, the warnings would be:<br />-- "WARNING: Cigarettes are addictive"<br />-- "WARNING: Tobacco smoke can harm your children"<br />-- "WARNING: Cigarettes cause fatal lung disease"<br />-- "WARNING: Cigarettes cause cancer"<br />-- "WARNING: Cigarettes cause strokes and heart disease"<br />-- "WARNING: Smoking during pregnancy can harm your baby"<br />-- "WARNING: Smoking can kill you"<br />-- "WARNING: Tobacco smoke causes fatal lung disease in non-smokers"<br />-- "WARNING: Quitting smoking now greatly reduces serious risks to your health"<br />For smokeless tobacco products, the warnings would be:<br />-- "WARNING: This product can cause mouth cancer"<br />-- "WARNING: This product can cause gum disease and tooth loss"<br />-- "WARNING: This product is not a safe alternative to cigarettes"<br />--"WARNING: Smokeless tobacco is addictive"<br />For cigarettes, the warnings would occupy 25% of the front panel of the package (including packs and cartons) and would appear on the upper portion thereof. The legislation would contain a grandfather provision for existing brands with flip-top boxes comprising less than 25% of the front panel. For smokeless tobacco products, the warnings would appear on the principal display panel (e.g., a band around the can for moist smokeless tobacco products) and would occupy 25% of the display panel. The warnings would be printed in line with current Canadian standards (e.g., 17 point type with appropriate adjustments depending on length of required text) and in an alternating black on white and white on black format. The size and placement of warnings in advertisements would follow the requirements set forth in the existing United Kingdom standards. As described in Appendix I, the warning text and, where relevant, "tar" and nicotine (or other constituent) yield information would occupy 20% of press advertisements.<br />Cigarette and smokeless tobacco product packages would also carry the FDA mandated statement of intended use ("Nicotine Delivery Device") on the side of pack.<br />2. The FDA would be required to promulgate a rule governing the testing, reporting and disclosure of tobacco smoke constituents that the Agency determines the public should be informed of to protect public health, including, but not limited to "tar," nicotine and carbon monoxide. This authority would be transferred from the FTC and would include the authority to require label and advertising disclosures relating to "tar" and nicotine, as well as disclosures by other means relating to other constituents.<br />[Source/precedent: Canadian warning regulations; FDA Rule; FDCA, 21 U.S.C. Sec. 360h, with conforming amendment in light of FCLAA]<br />C. <a name="Ic"></a>Restrictions on Access to Tobacco Products<br />Preventing youth access to tobacco products is a major objective of this legislation and the FDA Rule. Without preventing state and local governments from imposing stricter measures, the legislation would incorporate every access restriction of the FDA Rule, and more. As in the FDA Rule, the legislation would:<br />-- Set a minimum age of 18 to purchase tobacco products (897.14(a))<br />-- Require retailers to check photo identification of anyone under 27 (897.1 4(b)( 1 )-(2))<br />-- Establish the basic requirement of face-to-face transactions for all sales of tobacco products (897.14(c))<br />-- Ban the sale of tobacco products from opened packages (897.14(d))<br />-- Establish a minimum package size of 20 cigarettes (897.16(b))<br />-- Impose retailer compliance obligations to ensure that all self-service displays, advertising, labeling and other items conform with all applicable requirements (897.14(e))<br />-- Ban the sampling of tobacco products (897.16(d))<br />-- Ban the distribution of tobacco products through the mail, including redemption of coupons, except for sales subject to proof of age, with a review after 2 years by FDA to determine if minors are obtaining tobacco products through the mail (goes beyond 897.16(c)(2)(i))<br />Building on and going beyond the FDA Rule, the legislation would:<br />-- Ban all sales of tobacco products through vending machines (goes beyond 897.16(c)(2)(ii))<br />-- Ban self-service displays of tobacco products except in adult-only facilities. In all other retail outlets, tobacco products must be placed out of reach of consumers (i.e., behind the counter or under lock-and-key) or, if on the counter, not visible or accessible to consumers (goes beyond (897.1 6(c)(2)(ii))<br />[Source/precedent: FDA Rule]<br /><a name="Id"></a>D. Licensing of Retail Tobacco Product Sellers<br />The legislation would mandate minimum federal standards for a retail licensing program that the federal government and state and local authorities would enforce through funding provided by the Industry Payments. Any entity that sells directly to consumers - whether a manufacturer, wholesaler, importer, distributor or retailer -would require a license.<br />Elements of the licensing program would include:<br />-- Mandating compliance with the Act as a condition to obtain and hold a license<br />-- Penalties for violations (See Appendix II)<br />-- Suspension or revocation of licenses (on a site-by-site basis) for certain violations (see Appendix II)<br />-- A requirement that distribution of tobacco products for resale to consumers be made only to licensed entities<br />-- Licensing fees to cover the administrative costs of issuing state licenses (all other costs covered as noted above)<br />-- Comparable federal licensing programs (with federal enforcement) for military facilities, U.S. government installations abroad, and other U.S. territories and possessions not otherwise under the jurisdiction of the States (including duty-free shops within U.S. borders)<br />-- Comparable licensing programs to govern tobacco product sales on Indian lands (see Appendix III)<br />(Source/precedent: Various state laws governing sales of tobacco products and alcoholic beverages)<br /><a name="Ie"></a>E. Regulation of Tobacco Product Development and Manufacturing<br />This legislation, for the first time, would impose a regulatory regime to govern the development and manufacturing of cigarettes and smokeless tobacco products, including FDA approval of the ingredients used in such products and imposition of standards for reducing the level of certain constituents, including nicotine.<br />Elements of the regulatory regime would include:<br />1. Tobacco products shall have the same definition as contained in the FDA Rule. Jurisdiction shall also cover Roll Your Own, Little Cigars, Fine Cut, etc.<br />2. Tobacco will continue to be categorized as a "drug" and a "device" under the Food, Drug and Cosmetic Act ("FDCA"). The Agency's authority to regulate the products as restricted medical devices" will be explicitly recognized and tobacco products will be classified as a new subcategory of a Class II device pursuant to 21 U.S.C. section 360c. FDCA shall apply to these products as provided by the Act and the amendments to FDCA contained herein.<br />3. The Class II classification shall permit FDA to require product modification of tobacco products, including the regulation of nicotine content, and shall provide that the sale of tobacco products to adults in the form that conforms to Performance Standards established for tobacco products pursuant to Section 514 ("Section 514") of the FDCA (21 U.S.C. Section 360d) shall be permitted notwithstanding 21 U.S.C. Sections 360f, 352(j) and 360h(e)<br />4. Reduced Risks Products<br />Products sold that an objective, reasonable consumer would believe pose less of a health risk:<br />-- Tobacco product manufacturers will be barred from making claims that could reasonably be interpreted to state or imply a reduced health risk unless the manufacturer demonstrates to FDA that the product scientifically does in fact "significantly reduce the risk to health" from ordinary tobacco products. Currently employed product descriptors such as "light" and "low tar" will be regulated as described in 1(A) above.<br />-- FDA would have to approve all health claims (direct or implied), as well as the content and placement of any such claims in advertisements, to prevent the public from being misled and to prevent the advertisement from being used to expand, or prevent the contraction of, the marketplace.<br />-- For "less hazardous tobacco products," FDA will be authorized to permit scientifically-based specific health claims and to permit exceptions to the advertising restrictions that apply to other products if FDA determines that such advertising would reduce harm and promote the public health. The FDA will promulgate a rule to govern how these determinations will be made.<br />-- The manufacturers will be required to notify FDA of any technology that they develop or acquire and that reduces the risk from tobacco products and, for a commercially reasonable fee, to cross license all such technology, but only to those companies also covered by the same obligations. Procedural protections will be built in to resolve license fee disputes, if the private parties cannot agree among themselves first. If the technology reported to the FDA is in the early development stages, the manufacturer will be provided confidentiality protection during the development process.<br />-- The Agency shall also have the authority to mandate the introduction of "less hazardous tobacco products" that are technologically feasible, after a formal rule making subject to the Administrative Procedures Act ("APA"), with the right of judicial review. In doing so, the Agency shall have the authority to mandate that a manufacturer subject to this Act who owns such technology (at such manufacturer's election) either introduce such products, or, at a commercially reasonable market rate, license such technology to a manufacturer who agrees to bring the technology to market in a reasonable time frame. In the event that no manufacturer or licensee introduces such "less hazardous tobacco products," within a reasonable time frame set by FDA, then the U.S. Public Health Service may produce either itself, or through a licensing arrangement, any such product.<br />-- The goal of any rule mandating the introduction into the marketplace of "less hazardous tobacco products" for which the technology exists is to guarantee that a mechanism exists to ensure that products which appear to hold out the hope of reducing risk are actually tested and made available in the marketplace and not held back.<br />5. Performance Standards<br />To further the public health, to promote the production of "reduced risk" tobacco products, and to minimize the harm to consumers of tobacco products by insuring that the best available, feasible safety technology becomes the industry standard, FDA will have the authority to promulgate Performance Standards pursuant to Section 514 that require the modification of tobacco products to reduce the harm caused by those products (including the components that produce drug dependence), provided that the standard shall not require the prohibition on the sale to adults of traditional tobacco products in the basic form as described in the August 28, 1996 FDA Rule at 61 Fed. Reg. at 44616 (to be codified at 21 C.F.R. Section 897.3).<br />Specifically:<br />A. For a period of no fewer than twelve years following the effective date of the Act, the product Performance Standards will be governed by the following: The Agency shall be permitted to adopt performance standards that require the modification of existing tobacco products, including the gradual reduction, but not the elimination, of nicotine yields, and the possible elimination of other constituents or other harmful components of the tobacco product, based upon a finding that the modification: (a) will result in a significant reduction of the health risks associated with such products to consumers thereof, (b) is technologically feasible, and (c) will not result in the creation of a significant demand for contraband or other tobacco products that do not meet the product safety standard. In determining the risk of the demand for a market in contraband products, the FDA shall take into account the number of dependent tobacco product users and the availability, or lack thereof, of alternative products then on the market and such other factors as the Agency may deem relevant.<br />The authority to require such product modification can be exercised upon a showing of "substantial evidence," based upon an administrative record developed through a formal rule making subject to the Administrative Procedures Act, with the right of judicial review, and any such modification shall be subject to the current procedures of the Regulatory Reform Act of 1996 to provide time and a process for Congress to intervene should it so choose. In the event a party subsequently files a petition seeking an administrative review of whether a modification has, in fact, resulted in the creation of a significant demand for contraband or other tobacco products that do not meet the safety standard and FDA denies the petition, the petitioner shall have the right to seek judicial review of the denial of the petition.<br />Additionally:<br />-- Within one year of the effective date of this Act, the FDA shall establish a Scientific Advisory Committee to examine and determine the effects of the alteration of nicotine yield levels and to examine and determine whether there is a threshold level below which nicotine yields do not produce drug dependence and, if so, to determine that level, and also review any other safety, dependence or health issue so designated by FDA.<br />-- Separate from and without detracting from the Agency's authority under the requirements of the Section 514 Performance Standard noted above, effective three years from the date of enactment of this Act, no cigarette shall be sold in the United States which exceeds a 12 mg "tar" yield, using the testing methodology now being used by the Federal Trade Commission.<br />B. After the initial twelve year period, the Agency will be permitted to set product safety standards that go beyond the standards it is authorized to set pursuant to the above noted provisions and, if it does so, any such product Performance Standards shall be governed by the following: The Agency will be permitted to require the alteration of tobacco products then being marketed, including the elimination of nicotine and the elimination of other constituents or other demonstrated harmful components of the tobacco product, (the elimination of nicotine or other harmful constituent shall not be deemed to violate the prohibition on the sale of traditional tobacco products to adults, even if it results in a reduction of the number of the consumers who use the tobacco products then remaining on the market), based upon a finding that: (a) the safety standard will result in a significant overall reduction of the health risks to tobacco consumers as a group, (this includes the reduction in harm which will result from decreased drug dependence from the reduction and/or elimination of nicotine from (a) those who continue to use tobacco products, but less often, and (b) those who stop using tobacco products), (b) the modification is technologically feasible, and (c) the modification will not result in the creation of a significant demand for contraband or other tobacco products that do not meet the safety standard. In determining the overall health benefit of a change, the Agency shall consider the number of dependent tobacco users then in existence, the availability and demonstrated market acceptance of alternate products then on the market, and the effectiveness of smoking cessation techniques and devices then on the market and such other factors as the Agency may deem relevant.<br />Given the significance of such an action, the Agency will be permitted to require the elimination of nicotine or take such other action that would have an effect comparable to the elimination of nicotine based upon a "preponderance of the evidence" pursuant to, at a manufacturer's election, a Part 12 hearing, or notice and comment rule making, with a right of judicial review. Any such action shall be phased in, and no such phase-in shall begin in less than two years, to permit time for a meaningful Congressional review pursuant to the current procedures of the Regulatory Reform Act of 1996. In the event a party subsequently files a petition seeking an administrative review of whether a modification has, in fact, resulted in the creation of a significant demand for contraband or other tobacco products that do not meet the safety standard and the FDA denies the petition, the petitioner shall have the right to seek judicial review of the denial of the petition. In any judicial review, the deference accorded to the Agency's findings shall depend upon the extent to which the matter at issue is then within the Agency's field of expertise.<br />6. Manufacturing Oversight<br />The legislation would subject tobacco product manufacturers to good manufacturing practice standards ("GMPs") comparable to those applicable to medical device manufacturers, food companies and other FDA regulated industries, but tailored specifically to tobacco products. In this regard there would be:<br />-- Implementation of a quality control system (e.g., to prevent contamination) -- Inspection of tobacco product materials (e.g., to ensure compliance with quality standards) -- Requirements for proper handling of finished product -- Tolerances for pesticide chemical residues in or on commodities in the possession of the manufacturer; existing EPA authority and oversight is retained -- Inspection authority comparable to FDA's authority over other FDA regulated products, including the ability to enter manufacturing plants and demand certain records -- Record keeping and reporting requirements<br />Tobacco farmers will face no greater regulatory burden than the producers of other raw products regulated by the federal government.<br />[Source/precedent: FDA Rule; FDCA, 21 U.S.C. Sections 346a; 360]<br />7. Access to Company Information<br />-- The Act would ensure that previously non-public or confidential the files of the tobacco industry - including internal documents - are disclosed to FDA, private litigants The details of the arrangement are set forth in documents from health research and the public. Appendix VI II.<br />-- Any subpoena authority FDA has with respect to manufacturers of medical devices generally would also apply to tobacco product manufacturers.<br /><a name="If"></a>F. Non-tobacco Ingredients<br />Currently, at the federal level, tobacco manufacturers are required only to submit aggregated ingredient information (not by brand or company) to HHS for monitoring and review. Nor do tobacco products manufacturers currently disclose to consumers ingredients information for each of the tobacco products they sell.<br />The legislation would supersede the current often-criticized federal ingredient law and confirm FDA's authority to evaluate all additives in tobacco products. No non-tobacco ingredient could be used in manufacturing tobacco products unless the manufacturer can demonstrate that such ingredient is not harmful under the intended conditions of use. Further, the legislation would require the manufacturers to disclose to FDA the ingredients and the amounts thereof in each brand. In addition, it would require manufacturers to disclose ingredient information to the public under regulations comparable to what current federal law requires for food products, reflecting the intended conditions of use.<br />Under this proposed legislation:<br />-- Manufacturers would be required to provide FDA on a confidential basis a list of all ingredients, substances and compounds (other than tobacco, water or reconstituted tobacco sheet made wholly from tobacco) which are added by the manufacturer to the tobacco, paper or filter of the tobacco product by brand and by quantity in each brand. For each such item, the manufacturer would identify whether or not it believes that the item would be exempt from public disclosure under the legislation.<br />-- Manufacturers would be required to submit, within 5 years of the enactment of the Act, for each ingredient currently added to the tobacco product, a safety assessment, based on the best available evidence, that there is a reasonable certainty in the minds of competent scientists that the ingredient (up to a specified amount) is not harmful under the intended conditions of use. FDA shall promulgate applicable regulations within 12 months.<br />-- Within a statutory time assessment(s) in accordance within 90 days, FDA shall period FDA must review with the applicable standard; approve or disapprove an ingredient's safety, and if FDA takes no action, the ingredient is deemed approved. FDA may also challenge any manufacturer's assertion that an ingredient would be exempt from disclosure to consumers under applicable regulations comparable to what current federal law requires for food products.<br />-- New ingredients or use of current ingredients beyond the specified maximum amount are subject to a comparable process prior to use.<br />-- FDA would be required to protect as strictly confidential ingredient information not otherwise subject to public disclosure. If not subject to such disclosure, this information will be treated as trade secrets under federal law, exempt from FOIA requests and protected by procedures which shall include the designation of an agent who will store it in a locked cabinet, maintain a record of any person who has access to the information and require a written confidentiality commitment from any such person.<br />-- Manufacturers would be required to disclose to the public ingredients information pursuant to regulations comparable to what current federal law requires for food products. During an initial 5 year period, each ingredient that would be exempt from disclosure under the food regime would be presumed not to be subject to disclosure unless FDA disproves its safety. However, manufacturers would be required to disclose all ingredients which they have been compelled to publicly disclose with respect to a particular brand in order to comply with a statute or regulation (e.g., MA Ch 94 §307B).<br />-- Manufacturers would be required to have procedures for the selection, testing, purchase, storage and use of ingredients.<br />The Act would:<br />-Provide for record keeping regarding ingredients<br />-Allow FDA access to such records, with protection of proprietary information<br />[Source/precedent: MA Chapter 94, §307B; 21 C.F.R. §§101.4, 101.105, and 101.170; 18 U.S.C. §1905; 5 U.S.C. §552(b)(4); MA proposed reg. 105 C.M.R. §660.200(G)]<br /><a name="Ig"></a>G. Compliance and Corporate Culture.<br />A key element in achieving the Act's goals will be forcing a fundamental change in the way the tobacco industry does business. Accordingly, the Act will provide for means to ensure that the industry will not only comply with the letter of the law but will also have powerful incentives to prevent underage usage of tobacco products and to strive to develop and market less hazardous tobacco products.<br />First manufacturers would be required to create plans, with an annual review and update, to:<br />-- Ensure compliance with all applicable laws and regulations<br />-- Identify ways to achieve the goals of reduced youth access to and incidence of underage consumption of tobacco products and provide internal incentives for doing so<br />-- Provide internal incentives to develop products with reduced risk<br />Second, with a special emphasis on laws and regulations that make it unlawful to sell tobacco products to underage persons and other laws directed at the issue of underage tobacco use, the manufacturers must implement compliance programs that include, at a minimum, the following elements:<br />-- Compliance standards and procedures to be followed by employees and agents that are reasonably capable of reducing the prospect of violations<br />-- Assignment to specific individual(s) within high-level personnel of the organization of overall responsibility to oversee compliance with the relevant standards and procedures, especially in regard to preventing underage tobacco use<br />-- Use of due care not to delegate substantial discretionary authority to individuals who the organization knows, or should have known through the exercise of due diligence, had a propensity to disregard corporate policy<br />-- Steps to communicate relevant standards and procedures to all employees and other agents (including lobbyists), e.g., by requiring participation in training programs or by disseminating publications that explain in a practical manner what is required<br />-- Internal audits, hotlines and other measures to promote compliance<br />-- Appropriate disciplinary mechanisms and measures (e.g., discipline of employees who violate marketing restrictions)<br />-- Reasonable steps to respond appropriately to a violation and to prevent further similar violations<br />Furthermore, the Act would provide "whistleblowers" in the tobacco industry with the maximum protection available under current federal statutes.<br />Beyond compliance with the letter of the law, manufacturers would be required to take affirmative steps in furtherance of the spirit of the new regime, including:<br />-- Promulgating corporate principles that express and explain the company's commitment to compliance, reductions of underage tobacco use, and development of reduced risk tobacco products<br />-- Designating a specific individual within high-level personnel of the organization with appropriate responsibility and authority to promote efforts to attain these new standards<br />-- Providing reports to shareholders on compliance as well as progress toward meeting these new standards<br />Manufacturers would also be required to work with retail organizations on compliance, including retailer compliance checks and financial incentives for compliance.<br />Third, each tobacco manufacturer would require all contract lobbyists (and any other third-parties who may engage in lobbying activities on behalf of a manufacturer) to agree that they will not support or oppose any state or federal legislation, or seek or oppose any governmental action on any matter, without the manufacturer's express authorization. Manufacturers would also require anyone lobbying on their behalf to agree in writing that a) they are aware of and will fully comply with all applicable laws and regulations; b) they have reviewed and will fully comply with the Act as it applies to them; c) they have reviewed and will fully comply with the Consent Decree as it applies to them; and d) they have reviewed and will fully abide by the manufacturer's business conduct policies and any other policies and commitments as they apply, especially those related to prevention of youth tobacco usage.<br />Fourth, within ninety days after the Act's effective date, the Tobacco Institute and the Council for Tobacco Research, U.S.A. would be dissolved and disbanded. Tobacco product manufacturers would be permitted to form new trade associations only in accordance with strict procedures and federal oversight designed to ensure compliance with antitrust and other applicable laws. (See Appendix IV)<br />Finally, companies would be subject to fines and penalties (including "Scarlet Letter" advertising) for breaching their obligations vis-a'-vis the development, implementation and enforcement of compliance plans and corporate principles. These penalties shall follow the scheme set forth in the Clean Air Act, up to $25,000 per day per violation with a total not to exceed $200,000. In addition, each manufacturer's employees shall be directed to report to that manufacturer's compliance officer any known or alleged violations of this Act by retailers or distributors. In accordance with procedures established by FDA, the compliance officer shall be required to furnish all such reports to FDA for reference to appropriate federal or state enforcement authorities. The manufacturer shall be subject to fines or penalties in the event its compliance officer fails to furnish any such reports to FDA.<br />[Source/precedent: Federal Organizational Sentencing Guidelines; various federal consent decrees; various corporate environmental programs]<br /><a name="Ih"></a>H. Effective Dates<br />Many of the foregoing requirements relating to the reformation of the tobacco industry will become effective shortly after the Act is signed by the President; including the following categories of new rules, which will be implemented on the dates indicated:<br />Category / Effective Dates on Final Passage<br />Retail Product Displays / 9 months<br />Retail signage / 5 months<br />Advertising / 9 months<br />Package Labeling / 1/3 in 90 days<br />1/3 in 120 days<br />1/3 in 180 days<br />Sponsorships / 12/31/98<br />Vending machines / 12 months<br />Sampling / 3 months<br />GMPs / 24 months in accordance with rulemaking, whichever is later<br />Corporate compliance / 12 month<br />Face-to-face transactions / 3 months<br />Ban on sales of open packs / 3 months<br />20 cigarettes per pack minimum / 3 months<br />Puerto Rico pack size / 12 months<br /><a name="TITLEII"></a>TITLE II: "Look Back" Provisions/State Enforcement incentives<br />A central aim of this legislation is to achieve dramatic and immediate reductions in the number of underage consumers of tobacco products. The legislation accordingly contains a "look-back" provision giving tobacco product manufacturers significant economic incentives to take every possible step to ensure that the advertising, marketing and distribution requirements of this Act are met, and imposing substantial surcharges on the manufacturers in the event that underage tobacco-use reduction targets are not achieved.<br />The "look-back" provision sets targets for the dramatic reduction of current levels of underage tobacco use (as measured by the University of Michigan's National High School Drug Use Survey "Monitoring the Future"). Underage use of cigarette products must decline by at least 30% from estimated levels over the last decade by the fifth year after the legislation takes effect, by at least 50% from estimated levels over the last decade by the seventh year after the legislation takes effect, by at least 60% from estimated levels over the last decade by the tenth year after the legislation takes effect, and remain at such reduced levels or below thereafter. (These required reductions amount to even steeper declines from current levels of underage smoking.) Underage use of smokeless tobacco products must decline by at least 25% from current levels by the fifth year after the legislation takes effect, by at least 35% from current levels by the seventh year after the legislation takes effect, by at least 45% from current levels by the tenth year after the legislation takes effect, and remain at such reduced levels or below thereafter. FDA will annually assess the prevalence of underage tobacco use (based on the methodology employed by the University of Michigan survey) to determine whether these targets have been met.<br />If a target has not been met, FDA will impose a mandatory surcharge on the relevant industry (cigarette or smokeless tobacco) based upon an approximation of the present value of the profit the industry would earn over the lives of all underage users in excess of the target (subject to an annual cap of $2 billion for the cigarette industry (adjusted each year for inflation) and a comparably derived cap for the smokeless tobacco industry). Tobacco product manufacturers could receive a partial abatement of this surcharge (up to 75%) only if they could thereafter prove to FDA that they had fully complied with the Act, had taken all reasonably available measures to reduce youth tobacco use and had not taken any action to undermine the achievement of the required reductions.<br />A fuller description is provided in Appendix V.<br />In addition, the proposed Act goes well beyond the provisions of the Synar Amendment's "no tobacco sales to minors" law and related regulations, 42 U.S.C. § 300X-26, and the Final Rule promulgated thereunder, which became effective February 20,1996 (61 Fed. Reg., June 19,1996). The proposed Act requires the several States to undertake significant enforcement steps designed to dramatically reduce the incidence of youth smoking, and youth access to tobacco products. These enforcement obligations are funded by Industry Payments. Each state must maintain specific levels of enforcement effort, or the state risks the loss of a significant portion of the health care program funds otherwise payable to the state under the Act. Amounts withheld from states not doing an adequate enforcement job will be reallocated to states with a superior "no sales to minors" enforcement record. No state will be held responsible for sales to underage consumers outside that state's jurisdiction.<br />The details of these state enforcement incentives are set forth in Appendix VI.<br /><a name="TITLEIII:"></a>TITLE III: Penalties and Enforcement; Consent Decrees; Non-Participating Companies <br /><br /><SPAN style="DISPLAY: none"><br /><br />Anahtar kelimeler<br />proposed amendment<br />proposed amendments<br />proposed bills<br />proposed laws<br />proposed legislation<br />constitutional amendment proposed<br />proposed ammendments<br />proposed article<br />proposed bill<br />proposed bill of rights<br />proposed constitution<br />proposed constitutional amendments<br />proposed issue<br />proposed law<br />proposed legislature<br />proposed resolutions<br />proposed rights<br />proposed states<br />proposed us constitution<br />proposed admendments<br />Anahtar kelimeler<br />dog sex<br />a dog having sex<br />anal dog sex<br />animal dog sex<br />dog and girl sex<br />dog 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dog<br />girl having sex with dog<br />girls and dog sex<br />girls having sex with a dog<br />girls having sex with dog<br />guide to dog sex<br />had sex with my dog<br />hardcore dog sex<br />have sex with my dog<br />have sex with your dog<br />hector dog sex<br />horse and dog sex<br />hot dog sex<br />how to have sex with a dog<br />how to have sex with a female dog<br />how to have sex with dog<br />how to have sex with your dog<br />i had sex with my dog<br />i have sex with my dog<br />japanese dog sex<br />man and dog sex<br />man has sex with dog<br />man having sex with a dog<br />man having sex with dog<br />man on dog sex<br />men having sex with dogs<br />real dog sex<br />sex and the city dog<br />sex with a female dog<br />sex with dead dog<br />sex with dog stories<br />sex with dog video<br />sex with dog videos<br />sex with the dog<br />sex with your dog<br />sexdog com<br />snoop dog sex<br />watch dog sex<br />watch dog sex offender<br />watch dog sex offenders<br />wife dog sex<br />woman having sex with a dog<br />woman having sex with dog<br />women and dog sex<br />women having sex with a dog<br />women having sex with dog<br />dog on sex and the city<br /><br /><br /></span>Settlementhttp://www.blogger.com/profile/07780234485860161985noreply@blogger.com0tag:blogger.com,1999:blog-8812498477003583262.post-80506871484272818742007-10-24T06:44:00.000-07:002007-10-24T06:49:14.546-07:00MISSISSIPPI SETTLEMENT MEMORANDUMIN THE CHANCERY COURT OF JACKSON COUNTY, MISSISSIPPI<br /><br />IN RE MIKE MOORE, ATTORNEY GENERAL ex rel,<br />STATE OF MISSISSIPPI TOBACCO LITIGATION CAUSE NO. 94-1429<br />IN THE CHANCERY COURT OF JACKSON COUNTY, MISSISSIPPI<br />IN RE MIKE MOORE, ATTORNEY GENERAL ex rel,<br />STATE OF MISSISSIPPI TOBACCO LITIGATION<br />CAUSE NO. 94-1429<br />MEMORANDUM OF UNDERSTANDING<br />This Memorandum of Understanding ("MOU") is made as of July 2, 1997, by and among the undersigned counsel, on behalf of their respective clients, to set forth the principal terms and conditions of an agreement in principle among the parties hereto to settle and resolve with finality all present and future claims against all parties relating to the subject matter of this litigation which have been or could have been asserted by any of the parties hereto, including all claims on behalf of the State of Mississippi and all of its governmental agencies, departments, political subdivisions and any other state-controlled public entities (collectively "Mississippi" or "the State of Mississippi"). The parties contemplate the prompt drafting and execution of a comprehensive Settlement Agreement that will incorporate the terms of this MOU, as well as other customary terms and conditions, including releases, acceptable to the parties.<br />WHEREAS, the State of Mississippi, through its Attorney General Michael C. Moore, has instituted this action asserting various claims on behalf of the State of Mississippi against tobacco manufacturers and other defendants;<br />WHEREAS, the defendants have contested the claims in Mississippi's complaint;<br />WHEREAS, Attorney General Moore has had a leadership role among Attorneys General from various states in maintaining civil litigation against the tobacco industry and in seeking to forge an unprecedented national resolution of the principal issues and controversies associated with the manufacture, marketing and sale of tobacco products in the United States;<br />WHEREAS, through the efforts of Attorney General Moore and others a June 20, 1997 Memorandum of Understanding and attached Proposed Resolution ("Proposed Resolution") has been agreed to by members of the tobacco industry, state attorneys general, private litigants and representatives of public health groups which would provide for unprecedented and comprehensive regulation of the tobacco industry while preserving the right of individuals to assert claims for compensation;<br />WHEREAS, the Proposed Resolution contemplates action by the United States Congress and the President to enact and sign a new federal law with respect to the tobacco industry, which action the tobacco industry has agreed to support and which will require study and analysis by Congress and the President;<br />WHEREAS, trial is scheduled to commence on July 7, 1997 and a continuance of such trial could prejudice the State of Mississippi, the State of Mississippi and the undersigned defendants have agreed to settle independently the litigation commenced by Attorney General Moore pursuant to financial terms comparable to the Proposed Resolution, which terms will achieve for Mississippi immediately the financial benefits it would receive pursuant to the national Proposed Resolution, should it become law;<br />NOW THEREFORE, it is hereby agreed as follows:<br />This MOU will be presented to the Chancery Court of Jackson County (the "Court") promptly upon its execution, and the parties agree jointly to petition the Court to adjourn all further proceedings in contemplation of their final resolution and termination pursuant to this MOU and the Settlement Agreement contemplated hereby.<br />The Settlement Agreement shall contain among other things, the following terms to which the parties hereby agree:<br />1. On or before July 15, 1997 the undersigned defendants (the "Settling Defendants") shall cause to be paid into a special account (the "Account"), for the benefit of the State of Mississippi, to be held in escrow pending effectuation of the Settlement Agreement, the sum of $170 million; that<br />being plaintiff's good faith estimate of the portion Mississippi would receive of the $10 billion payment provided for in Paragraph A on page 34 of the June 20, 1997 Memorandum of Understanding and attached Proposed Resolution.<br />2. On or before July 30, 1997, the Settling Defendants shall cause to be paid to the Attorney General $2.5 million for the best estimate of costs and expenses attributable to his office and other appropriate state agencies in connection with this litigation; and on or before July 30, 1997, the Settling Defendants shall further cause to be paid $12.5 million to the plaintiffs' private counsel for their best estimate of their costs and expenses. The combined costs to be paid on July 30, 1997, may not exceed 15 million dollars. Thereafter the Attorney General's office, the appropriate state agencies and the plaintiffs' private counsel shall provide the Settling Defendants with an appropriately documented statement of their costs and expenses. The Settling Defendants shall promptly pay the amount of such costs and expenses in excess of the above $15 million, or shall receive a refund or a credit against other payments due hereunder if the total of such costs and expenses shall be less than $15 million. Any dispute as to the nature or amount of reimbursable costs and expenses shall be decided with finality by the persons selected to award fees pursuant to paragraph 8 below.<br />3. Commencing within ten (10) business days after December 31, 1998, and annually thereafter, the Settling Defendants shall cause to be paid to the Account 1.7% of the following amounts (in billions):<br />Year<br />1<br />2<br />3<br />4<br />5<br />6<br />thereafter<br />Amount<br />$4B<br />$4.5B<br />$5B<br />$6.5B<br />$6.5B<br />$8B<br />$8B<br />The above payments shall be adjusted upward by the greater of 3% or the Consumer Price Index applied each year on the previous year, beginning with the first annual payment. The above payments will also be decreased or increased, as the case may be, in accordance with decreases or increases in volume of domestic tobacco product volume sales as provided in Paragraph B.5 on pages 34-35 of the June 20, 1997 Proposed Resolution.<br />4. In recognition of the ongoing payments called for in paragraph 3 above, the Settlement Agreement will provide for the resolution of all past and future claims of the type described above against all defendants. The defendants will be released from all such claims by the State of Mississippi.<br />5. In the event that the Proposed Resolution is enacted as federal legislation, or if any substantially equivalent federal program is enacted, the settlement provided herein and in the Settlement Agreement shall remain in place, but the terms of such Proposed Resolution or federal program shall supersede the provisions of this MOU and Settlement Agreement. In order to provide the Settling Defendants with a full credit for all payments made hereunder pursuant to paragraphs I and 3 of this MOU in the event of the enactment of the Proposed Resolution or substantially equivalent federal program, and to the extent that the payments made to the Account pursuant to paragraphs 1 and 3 of this MOU shall differ from the amounts to be received by Mississippi pursuant to such Proposed Resolution or substantially equivalent federal program, adjustments shall be made in the form of a credit to the future payments by the Settling Defendants, a refund by the State of Mississippi, or other means that will ensure that the principal amount of payments received by Mississippi will be the same as the amounts they would receive pursuant to the Proposed Resolution or substantially equivalent federal program.<br />6. In the absence of the enactment of the Proposed Resolution or any substantially equivalent federal program, and in the event of multiple settlements by the Settling Defendants with various non-federal governmental plaintiffs in other similar litigation, it is agreed that the aggregate percentage applicable to the various non-federal governmental plaintiffs will not exceed 100%, and the sum of the initial payments will not exceed $10 billion. In order to ensure this result it is agreed that all such percentages (including the 1.7% applied in paragraph 1 and specified in paragraph 3) will be adjusted downward (by the same relative percentage) to achieve a total aggregate percentage of 100%.<br />7. The Settling Defendants agree that if they enter into any settlement agreement of other similar non-federal governmental litigation on terms more favorable to such governmental plaintiff then the terms of this MOU and the Settlement Agreement (after due consideration of relevant differences in population or other appropriate factors), the terms of this Settlement will be revised so that Mississippi will enjoy treatment at least as relatively favorable as any such other non-federal governmental entity.<br />8. The Settling Defendants agree to pay, separately and apart from the above, reasonable attorneys' fees. If the Proposed Resolution or substantially equivalent federal program is enacted, the amount of such fees will be set by a panel of independent arbitrators with finality, subject to an appropriate annual cap on all such payments and other conditions. In the absence of any such Proposed Resolution or substantially equivalent federal program, attorneys' fees in connection with this litigation will be awarded in the same manner (subject to an appropriate annual cap and other conditions) by three independent arbitrators selected by the parties hereto. In the event of the enactment of the Proposed Resolution or other substantially equivalent federal program, the parties contemplate that the State of Mississippi and any other similar state which has made an exceptional contribution to secure the resolution of these matters may apply to the panel of independent arbitrators for reasonable compensation for its efforts in securing the Proposed Resolution, subject to an appropriate separate annual cap on all such payments.<br />July 2, 1997<br />Washington, D.C.<br />STATE OF MISSISSIPPI<br />/s/Michael C. Moore, Attorney General<br /> <br />PHILIP MORRIS INCORPORATED<br />/s/By: Meyer G. Koplow<br /> <br />R.J. REYNOLDS TOBACCO COMPANY<br />/s/By: D. Scott Wise<br /> <br />BROWN & WILLIAMSON TOBACCO CORPORATION<br />/s/By: D. Scott Wise<br /> <br />LORILLARD TOBACCO COMPANY<br />/s/By: Meyer G. Koplow<br />MEMORANDUM OF UNDERSTANDING<br /><br />This Memorandum of Understanding ("MOU") is made as of July 2, 1997, by and among the undersigned counsel, on behalf of their respective clients, to set forth the principal terms and conditions of an agreement in principle among the parties hereto to settle and resolve with finality all present and future claims against all parties relating to the subject matter of this litigation which have been or could have been asserted by any of the parties hereto, including all claims on behalf of the State of Mississippi and all of its governmental agencies, departments, political subdivisions and any other state-controlled public entities (collectively "Mississippi" or "the State of Mississippi"). The parties contemplate the prompt drafting and execution of a comprehensive Settlement Agreement that will incorporate the terms of this MOU, as well as other customary terms and conditions, including releases, acceptable to the parties.<br /><br />WHEREAS, the State of Mississippi, through its Attorney General Michael C. Moore, has instituted this action asserting various claims on behalf of the State of Mississippi against tobacco manufacturers and other defendants;<br /><br />WHEREAS, the defendants have contested the claims in Mississippi's complaint;<br /><br />WHEREAS, Attorney General Moore has had a leadership role among Attorneys General from various states in maintaining civil litigation against the tobacco industry and in seeking to forge an unprecedented national resolution of the principal issues and controversies associated with the manufacture, marketing and sale of tobacco products in the United States;<br /><br />WHEREAS, through the efforts of Attorney General Moore and others a June 20, 1997 Memorandum of Understanding and attached Proposed Resolution ("Proposed Resolution") has been agreed to by members of the tobacco industry, state attorneys general, private litigants and representatives of public health groups which would provide for unprecedented and comprehensive regulation of the tobacco industry while preserving the right of individuals to assert claims for compensation;<br /><br />WHEREAS, the Proposed Resolution contemplates action by the United States Congress and the President to enact and sign a new federal law with respect to the tobacco industry, which action the tobacco industry has agreed to support and which will require study and analysis by Congress and the President;<br /><br />WHEREAS, trial is scheduled to commence on July 7, 1997 and a continuance of such trial could prejudice the State of Mississippi, the State of Mississippi and the undersigned defendants have agreed to settle independently the litigation commenced by Attorney General Moore pursuant to financial terms comparable to the Proposed Resolution, which terms will achieve for Mississippi immediately the financial benefits it would receive pursuant to the national Proposed Resolution, should it become law;<br /><br />NOW THEREFORE, it is hereby agreed as follows:<br /><br />This MOU will be presented to the Chancery Court of Jackson County (the "Court") promptly upon its execution, and the parties agree jointly to petition the Court to adjourn all further proceedings in contemplation of their final resolution and termination pursuant to this MOU and the Settlement Agreement contemplated hereby.<br /><br />The Settlement Agreement shall contain among other things, the following terms to which the parties hereby agree:<br /><br />1. On or before July 15, 1997 the undersigned defendants (the "Settling Defendants") shall cause to be paid into a special account (the "Account"), for the benefit of the State of Mississippi, to be held in escrow pending effectuation of the Settlement Agreement, the sum of $170 million; that<br /><br />being plaintiff's good faith estimate of the portion Mississippi would receive of the $10 billion payment provided for in Paragraph A on page 34 of the June 20, 1997 Memorandum of Understanding and attached Proposed Resolution.<br /><br />2. On or before July 30, 1997, the Settling Defendants shall cause to be paid to the Attorney General $2.5 million for the best estimate of costs and expenses attributable to his office and other appropriate state agencies in connection with this litigation; and on or before July 30, 1997, the Settling Defendants shall further cause to be paid $12.5 million to the plaintiffs' private counsel for their best estimate of their costs and expenses. The combined costs to be paid on July 30, 1997, may not exceed 15 million dollars. Thereafter the Attorney General's office, the appropriate state agencies and the plaintiffs' private counsel shall provide the Settling Defendants with an appropriately documented statement of their costs and expenses. The Settling Defendants shall promptly pay the amount of such costs and expenses in excess of the above $15 million, or shall receive a refund or a credit against other payments due hereunder if the total of such costs and expenses shall be less than $15 million. Any dispute as to the nature or amount of reimbursable costs and expenses shall be decided with finality by the persons selected to award fees pursuant to paragraph 8 below.<br /><br />3. Commencing within ten (10) business days after December 31, 1998, and annually thereafter, the Settling Defendants shall cause to be paid to the Account 1.7% of the following amounts (in billions):<br /><br />Year 1 2 3 4 5 6 thereafter<br />Amount $4B $4.5B $5B $6.5B $6.5B $8B $8B<br /><br />The above payments shall be adjusted upward by the greater of 3% or the Consumer Price Index applied each year on the previous year, beginning with the first annual payment. The above payments will also be decreased or increased, as the case may be, in accordance with decreases or increases in volume of domestic tobacco product volume sales as provided in Paragraph B.5 on pages 34-35 of the June 20, 1997 Proposed Resolution.<br /><br />4. In recognition of the ongoing payments called for in paragraph 3 above, the Settlement Agreement will provide for the resolution of all past and future claims of the type described above against all defendants. The defendants will be released from all such claims by the State of Mississippi.<br /><br />5. In the event that the Proposed Resolution is enacted as federal legislation, or if any substantially equivalent federal program is enacted, the settlement provided herein and in the Settlement Agreement shall remain in place, but the terms of such Proposed Resolution or federal program shall supersede the provisions of this MOU and Settlement Agreement. In order to provide the Settling Defendants with a full credit for all payments made hereunder pursuant to paragraphs I and 3 of this MOU in the event of the enactment of the Proposed Resolution or substantially equivalent federal program, and to the extent that the payments made to the Account pursuant to paragraphs 1 and 3 of this MOU shall differ from the amounts to be received by Mississippi pursuant to such Proposed Resolution or substantially equivalent federal program, adjustments shall be made in the form of a credit to the future payments by the Settling Defendants, a refund by the State of Mississippi, or other means that will ensure that the principal amount of payments received by Mississippi will be the same as the amounts they would receive pursuant to the Proposed Resolution or substantially equivalent federal program.<br /><br />6. In the absence of the enactment of the Proposed Resolution or any substantially equivalent federal program, and in the event of multiple settlements by the Settling Defendants with various non-federal governmental plaintiffs in other similar litigation, it is agreed that the aggregate percentage applicable to the various non-federal governmental plaintiffs will not exceed 100%, and the sum of the initial payments will not exceed $10 billion. In order to ensure this result it is agreed that all such percentages (including the 1.7% applied in paragraph 1 and specified in paragraph 3) will be adjusted downward (by the same relative percentage) to achieve a total aggregate percentage of 100%.<br /><br />7. The Settling Defendants agree that if they enter into any settlement agreement of other similar non-federal governmental litigation on terms more favorable to such governmental plaintiff then the terms of this MOU and the Settlement Agreement (after due consideration of relevant differences in population or other appropriate factors), the terms of this Settlement will be revised so that Mississippi will enjoy treatment at least as relatively favorable as any such other non-federal governmental entity.<br /><br />8. The Settling Defendants agree to pay, separately and apart from the above, reasonable attorneys' fees. If the Proposed Resolution or substantially equivalent federal program is enacted, the amount of such fees will be set by a panel of independent arbitrators with finality, subject to an appropriate annual cap on all such payments and other conditions. In the absence of any such Proposed Resolution or substantially equivalent federal program, attorneys' fees in connection with this litigation will be awarded in the same manner (subject to an appropriate annual cap and other conditions) by three independent arbitrators selected by the parties hereto. In the event of the enactment of the Proposed Resolution or other substantially equivalent federal program, the parties contemplate that the State of Mississippi and any other similar state which has made an exceptional contribution to secure the resolution of these matters may apply to the panel of independent arbitrators for reasonable compensation for its efforts in securing the Proposed Resolution, subject to an appropriate separate annual cap on all such payments.<br /><br />July 2, 1997<br /><br />Washington, D.C.<br /><br />STATE OF MISSISSIPPI<br />/s/Michael C. Moore, Attorney General<br /><br />PHILIP MORRIS INCORPORATED<br />/s/By: Meyer G. Koplow<br /><br />R.J. REYNOLDS TOBACCO COMPANY<br />/s/By: D. Scott Wise<br /><br />BROWN & WILLIAMSON TOBACCO CORPORATION<br />/s/By: D. Scott Wise<br /><br />LORILLARD TOBACCO COMPANY<br />/s/By: Meyer G. 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THE AMERICAN TOBACCO COMPANY, et al., Defendants. Civil Action No. 95-1466 AHSETTLEMENT AGREEMENT<br />This Settlement Agreement is made as of this 25th day of August, 1997, by and among the undersigned, and is intended to settle and resolve with finality all present and future civil claims against all parties to this litigation relating to the subject matter of this litigation, which have been or could have been asserted by any of the parties hereto.<br />WHEREAS, the State of Florida commenced this action in February, 1995, asserting various claims for monetary and injunctive relief on behalf of the State of Florida against tobacco manufacturers and other defendants;<br />WHEREAS, Defendants have contested the claims in Florida’s complaint and amended complaints and Plaintiffs have contested the claims in Defendants’ counter and cross claims against the Florida Department of Corrections and deny each and every one of the Defendants’ allegations;<br />WHEREAS, the State of Florida has, through its Governor, the Honorable Lawton M. Chiles, Jr. and its Attorney General, the Honorable Robert A. Butterworth, had a leadership role among the various states in maintaining civil litigation against the tobacco industry and in seeking to forge an unprecedented national resolution of the principal issues and controversies associated with the manufacture, marketing and sale of tobacco products in the United States;<br />WHEREAS, through the efforts of the State of Florida and others a June 20, 1997 Memorandum of Understanding and attached Proposed Resolution ("Proposed Resolution") has been agreed to by members of the tobacco industry, state attorneys general, private litigants and representatives of public health groups which would provide for unprecedented and comprehensive regulation of the tobacco industry while preserving the right of individuals to assert claims for compensation;<br />WHEREAS, the Proposed Resolution contemplates action by the United States Congress and the President to enact and sign a new federal law with respect to the tobacco industry, which action the tobacco industry has agreed to support and which will require study and analysis by Congress and the President;<br />WHEREAS, jury selection in this action commenced on August 1, 1997, and trial of the action is anticipated to last several months and a continuance of such trial could prejudice the State of Florida. The State of Florida and the undersigned defendants have agreed to settle independently the litigation commenced by the State of Florida pursuant to financial terms comparable to the Proposed Resolution, which terms will achieve for Florida immediately the financial benefits it would receive pursuant to the national Proposed Resolution, should it become law;<br />NOW THEREFORE, it is hereby agreed as follows:<br />I. GENERAL PROVISIONS<br />A. JURISDICTION<br />The Settling Defendants and Plaintiffs acknowledge that this Court has jurisdiction over the subject matter of this action and over each of the parties to this Settlement Agreement. Jurisdiction is retained by the Court for the purposes of enabling any party to this Settlement Agreement to apply to the Court at any time for further orders and directions as may be necessary and appropriate to implement or enforce this Settlement Agreement, and the parties hereto agree to present any disputes under this Settlement Agreement to this Court.<br />Notwithstanding the dismissal of claims provided for herein, the parties hereto agree that the Court will retain jurisdiction over the State of Florida’s claims for non-economic injunctive relief provided by the Proposed Resolution. The parties hereto jointly request the Court to set a trial date for the first Monday in August, 1998, or such later date as the Court may direct, said trial to proceed only if the Proposed Resolution or a substantially equivalent federal program has not been enacted. If the Proposed Resolution or a substantially equivalent federal program is not enacted by June 1, 1998, the parties may, with the Court’s permission, commence any appropriate pre-trial proceedings relevant to the trial of such issues. If the Proposed Resolution or a substantially equivalent federal program is enacted, any remaining claims shall be dismissed with prejudice.<br />B. APPLICABILITY<br />This Settlement Agreement shall be binding upon all Settling Defendants and their successors and assigns in the manner expressly provided for herein and shall inure to their benefit and to that of their respective directors, officers, employees, attorneys, representatives, insurers, suppliers, distributors, agents and of any of their present or former parents, subsidiaries, affiliates, divisions, or other organizational units of any kind. This Settlement Agreement shall be binding on and inure to the benefit of the State of Florida, the named Plaintiffs, their administrators, representatives, employees, officers, agents, legal representatives; all Agencies, Departments, Commissions, and Divisions of the State; all subdivisions, public entities, public corporations, instrumentalities, and educational institutions over which the State has control; and their predecessors, successors and assigns.<br />C. VOLUNTARY AGREEMENT OF PARTIES<br />Settling Defendants understand and acknowledge that certain provisions of this Settlement Agreement impose certain requirements on them that could give rise to challenges under federal and State constitutions if the State of Florida unilaterally imposed them. The parties hereto acknowledge and agree that this Settlement Agreement is voluntarily entered into by all parties hereto as the result of arms length negotiations during which all parties were represented by counsel. None of the parties hereto will seek to void this Settlement Agreement based on any constitutional challenge to the provisions contained herein.<br />D. DEFINITIONS<br />1. "Plaintiffs" means collectively the Plaintiffs, State of Florida, Lawton M. Chiles, Jr., individually and as Governor of the State of Florida, the Department of Business and Professional Regulation, the Agency for Health Care Administration and the Department of Legal Affairs.<br />2. "State" or "State of Florida" means collectively the Plaintiffs, State of Florida, Lawton M. Chiles, Jr., individually and as Governor of the State of Florida, the Department of Business and Professional Regulation, the Agency for Health Care Administration, and the Department of Legal Affairs, all of its officers acting in their official capacities and any other department, subdivision or agency of the State, regardless of whether a named Plaintiff.<br />3. "Settling Defendants" means those Defendants in this Action that are signatories to this Settlement Agreement.<br />4. "Non-Settling Defendants" means those Defendants that are not signatories to this Settlement Agreement.<br />5. "Market Share" means, for each year, a Settling Defendant’s respective share of sales of cigarettes for consumption in the United States.<br />6. "Tobacco Products" shall be defined in the same manner as in the Food and Drug Administration Rule and shall include Roll-Your-Own, Little Cigars and Fine Cut.<br />7. "Billboards" includes billboards, as well as all signs and placards in arenas and stadia, whether open-air or enclosed. "Billboards" does not include: (1) any advertisements placed on or outside the premises of retail establishments licensed to sell Tobacco Products or any retail point-of-sale; and (2) billboards or advertisements in connection with the sponsorship by the Settling Defendants of any entertainment, sporting or similar event, such as NASCAR, that appears in the State of Florida as part of a national or multi-state tour.<br />8. "Transit Advertisements" means advertising on private or public vehicles and all advertisements placed at, on or within any bus stop, taxi stand, waiting area, train station, airport or any similar location.<br />9. "Final Approval" means the date on which all of the following shall have occurred:<br />a. The Settlement Agreement is approved by the Court;<br />b. Entry is made of an order of dismissal of claims or a final judgment as provided herein; and<br />c. The time for appeal or to seek permission to appeal from the Court’s approval as described in (a) hereof, and entry of such final judgment or order of dismissal as described in (b) hereof has expired or if appealed, the appeal has been dismissed or the approval and judgment or order have been affirmed by the court of last resort to which such appeal has been taken and such affirmance has become no longer subject to further appeal or review.<br />II. OBLIGATIONS OF PARTIES<br />A. NON-MONETARY PROVISIONS<br />1. Elimination of Billboards and Transit Advertisements. Settling Defendants agree to discontinue all Billboards and Transit Advertisements of Tobacco Products in the State of Florida. Settling Defendants agree to exercise their best efforts in cooperation with the State of Florida to identify all Billboards that are located within 1000 feet of any public or private school or playground in the State of Florida. Settling Defendants will remove such Tobacco Product advertisements (leaving the space unused or used for advertising unrelated to Tobacco Products) or, at the option of the State of Florida, will allow the State of Florida, at its expense, to substitute for the remaining term of the contract alternative advertising intended to discourage the use of Tobacco Products by children under the age of 18. Settling Defendants agree to provide the State of Florida with a preliminary list of the location of all Billboards and Stationary Transit Advertisements within 30 days from the date of execution of this Settlement Agreement, such list to be finalized within an additional 15 days, and to remove all Billboards and Transit Advertisements for Tobacco Products within the State of Florida at the earlier of the expiration of applicable contracts or 4 months from the date the final list is supplied to the State of Florida. The parties hereto also agree to cooperate to secure the expedited removal of up to 50 Billboards or stationary Transit Advertisements designated by the State of Florida, within 30 days after their designation.<br />Each Settling Defendant shall provide the Court and the Attorney General, or his designee, with the name of a contact person to whom Plaintiffs may direct inquiries during the time such Billboards and Transit Advertisements are being eliminated, from whom the Plaintiffs may obtain periodic reports as to the progress of their elimination and who will be responsible for ensuring that appropriate action is taken to remove any Billboards that have not been timely eliminated.<br />2. Support of Legislation and Rules. Following Final Approval of this Settlement Agreement, Settling Defendants agree to support legislative initiatives to enact new laws and administrative initiatives to promulgate new rules intended to effectuate the following:<br />a. The prohibition of the sale of cigarettes in vending machines, except in adult-only locations and facilities;<br />b. The strengthening of civil penalties for sales of Tobacco Products to children under the age of 18, including the suspension or revocation of retail licenses; and<br />c. The strengthening of civil penalties for possession of Tobacco Products by children under the age of 18.<br />3. Document Disclosure. Settling Defendants and the State of Florida agree to cooperate to secure the expedited review of any decisions issued prior to the date of this Settlement Agreement regarding the inapplicability of any assertion of privilege with respect to documents or other material. The documents covered by this provision are those documents and materials which have been presented to the Special Master, the Honorable R. William Rutter, Jr., and as to which a Report and Recommendation has been issued requiring the disclosure and production of such documents or materials, for whatever reason.<br />B. MONETARY PROVISIONS<br />1. Initial Payment -- General. On or before September 15, 1997, Settling Defendants shall, pursuant to a mutually acceptable Escrow Agreement, cause to be paid into a special escrow account (the "Escrow Account"), for the benefit of the State of Florida, to be held in escrow pending Final Approval, the sum of $550 million; that being Plaintiffs’ good faith estimate of the portion Florida would receive of the $10 billion payment provided for in Paragraph A on page 34 of the June 20, 1997 Memorandum of Understanding and attached Proposed Resolution.<br />2. Initial Payment -- Pilot Program. In support of Florida’s demonstrated commitment to the meaningful and immediate reduction of the use of Tobacco Products by children under the age of 18, Settling Defendants also agree to support a pilot program (the "Pilot Program") by the State of Florida, the elements of which shall be aimed specifically at the reduction of the use of Tobacco Products by persons under the age of 18 years. Accordingly, on or before September 15, 1997, the Settling Defendants shall, pursuant to the Escrow Agreement, cause to be paid into a second special escrow account (the "Second Escrow Account"), for the benefit of the State of Florida, to be held in escrow pending Final Approval of this Settlement Agreement, the sum of $200 million. The Pilot Program will commence upon Final Approval of this Settlement Agreement and last for a 24-month period following such date. The $200 million amount payable by Settling Defendants in support of the Pilot Program shall be used only after approval by the Court and at the rate of approximately $100 million per 12-month period for general enforcement, media, educational and other programs directed to the underage users or potential underage users of Tobacco Products, but shall not be directed against the tobacco companies or any particular tobacco company or companies or any particular brand of Tobacco Products.<br />3. Annual Payments. On September 15, 1998, (subject to adjustment for actual market share by January 30, 1999), and annually thereafter, on December 31st (subject to final adjustment within 30 days), each of the Settling Defendants agrees, severally and not jointly, that it shall cause to be paid into a special account for the benefit of the State of Florida (the "Account"), pro rata in proportion equal to its respective Market Share, its share of 5.5% of the following amounts (in billions):<br />Year<br />1<br />2<br />3<br />4<br />5<br />6<br />thereafter<br />Amount<br />$4B<br />$4.5B<br />$5B<br />$6.5B<br />$6.5B<br />$8B<br />$8B<br />The payments made to the Account by the Settling Defendants pursuant to the calculation set forth in this paragraph shall be adjusted upward by the greater of 3% or the Consumer Price Index applied each year on the previous year, beginning with the first annual payment. Such Payments will also be decreased or increased, as the case may be, in accordance with decreases or increases in volume of domestic tobacco product volume sales as provided in Paragraph B.5 on pages 34-35 of the Proposed Resolution. Any payment pursuant to this paragraph that is due to be paid before Final Approval of this Settlement Agreement shall be paid into the Escrow Account and shall be disbursed only as provided by the terms of the Escrow Agreement. On September 15, 1998, Settling Defendants shall pay $220 million without any adjustment, that being Settling Defendants’ and the State’s best estimate of the first such annual payment (in respect of 1998).<br />4. Use of Funds. The monies received under this Settlement Agreement constitute not only reimbursement for Medicaid expenses incurred by the State of Florida, but also settlement of all of Florida’s other claims, including those for punitive damages, RICO and other statutory theories. In consonance with the Proposed Resolution, other than the Pilot Program and legal expense reimbursement, the parties hereto anticipate that funds provided hereunder, only after approval by the Court, will be used for children’s health care coverage and other health-related services, to reimburse the State of Florida for medical expenses incurred by the State, for mandated improvements in State enforcement efforts regarding the reduction of sales of Tobacco Products to minors, and to ensure the Proposed Resolution’s performance targets. The funds provided hereby may be used for such purposes as the State match required to draw federal funds to provide children’s health care coverage and for enhancement of children’s and adolescents’ substance abuse services, substance abuse prevention and intervention and children’s mental health services.<br />5. Adjustments in Event of Federal Resolution. In the event that the Proposed Resolution is enacted as federal legislation, or if any substantially equivalent federal program is enacted, the settlement provided herein shall remain in place, but the terms of such Proposed Resolution or federal program shall supersede the provisions of this Settlement Agreement, except for the Pilot Program and to the extent that the parties hereto have otherwise expressly agreed. In order to provide the Settling Defendants with a full credit for all payments made hereunder pursuant to paragraphs II.B.1 and II.B.3 of this Settlement Agreement in the event of the enactment of the Proposed Resolution or substantially equivalent federal program, and to the extent that the payments made pursuant to paragraphs II.B.1 and II.B.3 of this Settlement Agreement shall differ from the amounts to be received by the State of Florida pursuant to such Proposed Resolution or substantially equivalent federal program, the parties hereto shall take whatever steps are necessary to ensure that the principal amount of payments received by the State of Florida will be the same as the amounts it would receive pursuant to the Proposed Resolution or substantially equivalent federal program.<br />C. DISMISSAL, WAIVER AND RELEASE OF CLAIMS<br />1. Dismissal of Plaintiffs’ Claims. Upon approval of this Settlement Agreement by the Court, Plaintiffs shall dismiss, with prejudice as to Settling Defendants (including their parents and affiliates), and without prejudice as to other Non-Settling Defendants, all claims in this Action, except to the extent such claims seek non-economic injunctive relief provided by the Proposed Resolution. In the event any Non-Settling Defendants agree to comply with the non-economic terms contained in this Settlement Agreement, Plaintiffs shall dismiss with prejudice all claims against any such Non-Settling Defendants, except to the extent such claims seek non-economic injunctive relief provided by the Proposed Resolution.<br />2. Plaintiffs’ Waiver and Release. On the Final Approval Date, the State of Florida shall release and forever discharge all Defendants and their present and former parents, subsidiaries, divisions, affiliates, officers, directors, employees, representatives, insurers, agents, attorneys and distributors (and the predecessors, heirs, executors, administrators, successors, and assigns of each of the foregoing) (the "Released Parties"), from any and all manner of civil claims, demands, actions, suits, and causes of action, damages whenever incurred, liabilities of any nature whatsoever, including costs, expenses, penalties and attorneys’ fees ("Claims"), known or unknown, suspected or unsuspected, accrued or unaccrued, whether legal, equitable or statutory, both past, as to any claims that were or could have been made in this action or any comparable federal action, and as to the future, as to all Claims directly or indirectly based on, arising out of or in any way related to, in whole or in part, the use of or exposure to Tobacco Products manufactured in the ordinary course of business, that the State of Florida (including any of its past, present or future agents, officials acting in their official capacities, legal representatives, agencies, departments, commissions, divisions, subdivisions (political and otherwise), public entities, corporations, instrumentalities, and educational institutions, and whether or not any such person or entity participates in the settlement), whether directly, indirectly, representatively, derivatively or in any other capacity, ever had, now has or hereafter can, shall or may have (hereinafter, collectively, the "Released Claims"). Notwithstanding any provision herein, Plaintiffs do not release the claims for non-economic relief reserved under this Settlement Agreement, and Defendants retain all defenses thereto.<br />The State of Florida hereby covenants and agrees that it shall not, hereafter, sue or seek to establish civil liability against any Released Party based, in whole or in part, upon any of the Released Claims. The State of Florida agrees that this covenant and agreement shall be a complete defense to any such civil action or proceeding; provided, however, that those Non-Settling Defendants which are not parents or affiliates of the Settling Defendants shall be entitled to the foregoing release and covenant not to sue only upon their assent to comply with the non-economic provisions of this Settlement Agreement and the Waiver of Claims.<br />3. Settling Defendants’ Waiver and Dismissal of Claims. Upon Final Approval, Settling Defendants shall waive any and all claims against any of the Plaintiffs in this action including the State, or against any of their officers, employees, agents, counsel, witnesses (fact or expert), whistle-blowers or contractors, relating to or in connection with this litigation and shall dismiss, with prejudice, any pending claims or actions against such persons or entities that arise out of this litigation of this lawsuit.<br />IV. MOST FAVORED NATION<br />The Settling Defendants agree that if they enter into any future pre-verdict settlement agreement of other litigation brought by a non-federal governmental plaintiff on terms more favorable to such governmental plaintiff than the terms of this Settlement Agreement (after due consideration of relevant differences in population or other appropriate factors), the terms of this Settlement Agreement will be revised so that the State of Florida will obtain treatment at least as relatively favorable as any such non-federal governmental entity.<br />V. COSTS AND FEES<br />On or before September 30, 1997, the Settling Defendants shall cause to be paid to the Attorney General of Florida $10 million for the best estimate of costs and expenses attributable to his office and other appropriate state agencies or entities in connection with this litigation (cost for public employees shall be at prevailing market rates); and on or before September 30, 1997, the Settling Defendants shall further cause to be paid $12 million to the Plaintiffs’ private counsel for their best estimate of their costs and expenses. Thereafter the Attorney General’s Office, the appropriate state entities and Florida’s private counsel shall provide the Settling Defendants with an appropriately documented statement of their costs and expenses. The Settling Defendants shall promptly pay the amount of such costs and expenses in excess of the above $22 million, or shall receive a refund or a credit against other payments due hereunder if the total of such costs and expenses shall be less than $22 million. Any dispute as to the nature or amount of reimbursable costs and expenses shall be decided with finality by the persons selected to award fees, as provided below.<br />Settling Defendants agree to pay, separately and apart from the above, reasonable attorneys’ fees to private counsel. If the Proposed Resolution or substantially equivalent federal program is enacted, the amount of such fees will be set by a panel of independent arbitrators with finality, subject to an appropriate annual cap on all such payments and other conditions. In the absence of any such legislation enacting the Proposed Resolution or a substantially equivalent federal program, attorneys’ fees in connection with this litigation will be awarded in the same manner (subject to the appropriate annual cap and other conditions) by three independent arbitrators selected by the parties hereto.<br />In addition to the foregoing, in the event of the enactment of the Proposed Resolution or other substantially equivalent federal program, the parties hereto contemplate that the State of Florida and any other similar state which has made an exceptional contribution to secure the resolution of these matters may apply to the panel of independent arbitrators for reasonable compensation for its efforts in securing the Proposed Resolution, subject to an appropriate separate annual cap on all such payments.<br />VI. MISCELLANEOUS<br />A. HEADINGS. The headings of the paragraphs and sections of this Settlement Agreement are not binding and are for reference only and do not limit, expand, or otherwise affect the contents of this Settlement Agreement.<br />B. NO ADMISSION. This Settlement Agreement and any proceedings taken hereunder are not intended and shall not in any event be construed as, or deemed to be, an admission or concession or evidence of any liability or any wrongdoing whatsoever on the part of any party or any Released Party. The parties hereto and Released Parties specifically disclaim and deny any liability or wrongdoing whatsoever with respect to the allegations and claims asserted against them in this action and enter into this Settlement Agreement solely to avoid the further expense, inconvenience, burden and uncertainty of litigation.<br />C. NON-ADMISSIBILITY. These settlement negotiations have been undertaken by the parties in good faith and for settlement purposes only, and neither this Settlement Agreement nor any evidence of negotiations hereunder, shall be offered or received in evidence in this Action, or any other action or proceeding, for any purpose other than in an action or proceeding arising under this Settlement Agreement.<br />D. AMENDMENT. This Settlement Agreement may be amended only by a writing executed by all signatories hereto and any provision hereof may be waived only by an instrument in writing executed by the waiving party. The waiver by any party of any breach of this Settlement Agreement shall not be deemed to be or construed as a waiver of any other breach, whether prior, subsequent, or contemporaneous, of this Settlement Agreement.<br />E. COOPERATION. The parties to this Settlement Agreement and their attorneys agree to use their best efforts and to cooperate with each other to cause this Settlement Agreement to become effective, to obtain all necessary approvals, consents and authorizations, if any, and to execute all documents and to take such other action as may be appropriate in connection therewith. The parties hereto may agree, without further order of the Court, to reasonable extensions of time to carry out any of the provisions of this Settlement Agreement.<br />F. GOVERNING LAW. This Settlement Agreement shall be governed by the law of the State of Florida.<br />G. CONSTRUCTION. None of the parties hereto shall be considered to be the drafter of this Settlement Agreement or any provision hereof for the purpose of any statute, case law or rule of interpretation or construction that would or might cause any provision to be construed against the drafter hereof.<br />H. INTENDED BENEFICIARIES. This Action was brought by the State of Florida, through its Governor and Attorney General, to recover certain monies and to promote the health and welfare of the people of Florida. No portion of this Settlement Agreement shall provide any rights to, or be enforceable by, any person or entity that is not a party hereto or a Released Party.<br />I. COUNTERPARTS. This Settlement Agreement may be executed in counterparts. Facsimile or photocopied signatures shall be considered as valid signatures as of the date hereof, although the original signature pages shall thereafter be appended to this Settlement Agreement.<br />ENTERED INTO THIS 25th DAY OF AUGUST, 1997.<br />WEST PALM BEACH,<br />STATE OF FLORIDA<br />By:<br />___________________________________ ___________________________________<br />Lawton M. Chiles, Jr., Robert A. Butterworth,<br />Governor Attorney General<br />PHILIP MORRIS INCORPORATED R.J. REYNOLDS TOBACCO COMPANY<br />By: By:<br />___________________________________ ___________________________________<br />BROWN & WILLIAMSON TOBACCO LORILLARD TOBACCO COMPANY<br />CORPORATION<br />By: By:<br />_________________________________ ____________________________________<br />UNITED STATES TOBACCO COMPANY<br />By:<br />_________________________________<br /><br /><SPAN style="DISPLAY: none"><br /><br />Anahtar kelimeler<br />florida settlement<br />class action suits florida<br />debt settlement attorneys florida<br />debt settlement florida<br />debt settlement in florida<br />florida class action<br />florida class action law<br />florida class action lawsuits<br />florida class action suit<br />florida divorce settlement<br />florida estate settlement<br />florida life settlement<br />florida marital settlement<br />florida marital settlement agreement<br />florida property settlement<br />florida proposal for settlement<br />florida settlement agreement<br />florida tobacco class action<br />florida tobacco settlement<br />florida workers compensation settlement<br />jacksonville florida settlement<br />microsoft settlement florida<br />pioneer settlement florida<br />settlement in florida<br />settlement of florida<br />spanish settlement florida<br />class action lawsuits miami florida<br />davis settlement florida<br />debt settlement lawyer florida<br />european settlement in florida<br />florida attorney general settlement<br />florida class action law suit<br />florida class action settlement<br />florida divorce settlement agreement<br />florida dmv class action<br />florida mediation settlement amount<br />florida settlement statement<br />florida vehicle registration class action<br />florida workers comp lump sum settlement calculation<br />florida workmans comp settlement<br />mandated for property settlement in florida<br />property settlement in florida<br />spanish settlement in florida<br />what provisions are mandated for property settlement in florida<br />Anahtar kelimeler<br />florida court<br />florida insurance<br />florida law<br />florida miami<br />florida orlando<br />florida property<br />florida sanford<br />florida state of<br />fort lauderdale florida<br />fort myers florida<br />ft lauderdale florida<br />jacksonville florida<br />kissimmee florida<br />largo florida<br />melbourne florida<br />naples florida<br />ocala florida<br />palm beach florida<br />pensacola florida<br />real estate florida<br />sarasota florida<br />tallahassee florida<br />tampa florida<br />venice florida<br />west palm beach florida<br />auto settlement<br />brevard county florida<br />broward county florida<br />california settlement<br />chamber of commerce florida<br />clermont florida<br />divorce settlement<br />fla florida<br />florida california<br />florida compensation<br />florida custody<br />florida disability<br />florida divorce<br />florida forms<br />florida laws<br />florida rights<br />florida title<br />hillsborough county florida<br />illinois settlement<br />insurance settlement<br />lee county florida<br />palm beach county florida<br />pasco county florida<br />pinellas county florida<br />polk county florida<br />property settlement<br />real estate settlement<br />seminole county florida<br />seminole florida<br />settlement contract<br />settlement law<br />tampa bay florida<br />texas settlement<br />civil settlement<br />custody settlement<br />fl settlement<br />florida settled<br />florida settlements<br />marriage settlement<br />melbourne settlement<br />miami settlement<br />pensacola settlement<br /><br /><br /><br /></span>Settlementhttp://www.blogger.com/profile/07780234485860161985noreply@blogger.com0tag:blogger.com,1999:blog-8812498477003583262.post-51314416276859612042007-10-24T06:19:00.001-07:002007-10-24T06:33:29.981-07:00MINNESOTA SETTLEMENTSTATE OF MINNESOTA DISTRICT COURT<br />COUNTY OF RAMSEY<br />SECOND JUDICIAL DISTRICT<br />THE STATE OF MINNESOTA, BY HUBERT H. HUMPHREY III, ITS ATTORNEY GENERAL, and BLUE CROSS AND BLUE SHIELD OF MINNESOTA,<br />Plaintiffs,<br />vs.<br />PHILIP MORRIS INCORPORATED, R.J. REYNOLDS TOBACCO COMPANY, BROWN & WILLIAMSON TOBACCO CORPORATION, B.A.T. INDUSTRIES P.L.C., BRITISH-AMERICAN TOBACCO COMPANY LIMITED, BAT (U.K. & EXPORT) LIMITED, LORILLARD TOBACCO COMPANY, THE AMERICAN TOBACCO COMPANY, LIGGETT GROUP, INC., THE COUNCIL FOR TOBACCO RESEARCH-U.S.A., INC., and THE TOBACCO INSTITUTE, INC.,<br />Defendants.<br />Civil Case No. C1-94-8565<br />May 8, 1998<br />SETTLEMENT AGREEMENT AND STIPULATION FOR ENTRY OF CONSENT JUDGMENT<br />THIS SETTLEMENT AGREEMENT AND RELEASE ("Settlement Agreement") is made as of the date hereof, by and among the parties hereto, as indicated by their signatures below, to settle and resolve with finality all claims of the State of Minnesota relating to the subject matter of this action which have been or could have been asserted by the State of Minnesota.<br />WHEREAS, the State of Minnesota, through its Attorney General Hubert H. Humphrey III, and Blue Cross and Blue Shield of Minnesota, commenced this action on August 17, 1994, asserting various claims for monetary, equitable and injunctive relief on behalf of the State of Minnesota and Blue Cross and Blue Shield of Minnesota against certain tobacco manufacturers and others as Defendants;<br />WHEREAS, the Defendants have denied each and every one of Plaintiffs' allegations of unlawful conduct or wrongdoing and have asserted a number of defenses to Plaintiffs' claims, which defenses have been contested by Plaintiffs;<br />WHEREAS, the parties hereto wish to avoid the further expense, delay, inconvenience, burden and uncertainty of continued litigation of this matter (including appeals from any verdict), the State of Minnesota and the Settling Defendants have agreed to settle this litigation pursuant to terms which will achieve for the State of Minnesota (and thus for the people of the State of Minnesota) significant funding for the advancement of public health, the implementation of important tobacco-related public health measures in Minnesota, as well as funding for national research dedicated to studying and significantly reducing the use of Tobacco Products by youth;<br />WHEREAS, the State of Minnesota and Settling Defendants have agreed to settle this lawsuit on terms set forth in this Settlement Agreement and Stipulation for Entry of Consent Judgment and the attached Consent Judgment;<br />WHEREAS, the parties have further greed to jointly petition the Court for approval of the Consent Judgment, on the grounds that settlement would be in the public interest;<br />NOW, THEREFORE, BE IT KNOWN THAT, in consideration of the payments to be made by the Settling Defendants, the dismissal and release of claims by the State of Minnesota and such other consideration as described herein, the sufficiency of which is hereby acknowledged, the parties hereto, acting by and through their authorized agents, memorialize and agree as follows:<br />GENERAL PROVISIONS<br />Jurisdiction.<br />The State and the Settling Defendants acknowledge that this Court has jurisdiction over the subject matter of this action and over each of the parties to this Settlement Agreement, and that this Court shall retain jurisdiction for the purposes of implementing and enforcing this Settlement Agreement. The parties hereto agree to present any disputes under this Settlement Agreement, including without limitation any claims for breach or enforcement of this Settlement Agreement, exclusively to this Court. The Court may, upon the State's application, enter a Consent Judgment in the form attached hereto as Exhibit A. The cumulative terms of this Settlement Agreement and Stipulation for Entry of Consent Judgment, and the attached Consent Judgment, may be referred to for convenience as this "Agreement" or "Settlement Agreement."<br />Voluntary Agreement of the Parties.<br />The State and the Settling Defendants acknowledge and agree that this Settlement Agreement is voluntarily entered into by all parties hereto as the result of arm's-length negotiations during which all such parties were represented by counsel. The State and Settling Defendants understand that Congress may enact legislation dealing with some of the issues addressed in this Agreement. Settling Defendants and their assigns, affiliates, agents, and successors hereby waive any right to challenge this Agreement or the Consent Judgment, directly or through third parties, on the ground that any term hereof is unconstitutional, outside the power or jurisdiction of the Court, preempted by or in conflict with any current or future federal legislation (except where non-economic terms of future federal legislation are irreconcilable).<br />Definitions.<br />For the purposes of this Settlement Agreement and attached Consent Judgment, the following terms shall have the meanings set forth below:<br />"State" or "State of Minnesota" means the State of Minnesota acting by and through its Attorney General;<br />"Blue Cross" means BCBSM, Inc., d/b/a Blue Cross and Blue Shield of Minnesota, and all of its administrators, representatives, employees, directors, officers, agents, attorneys, parents and divisions;<br />"Settling Defendants" means those Defendants in this action that are signatories hereto;<br />"Defendants" means Philip Morris Incorporated, R.J. Reynolds Tobacco Company, Brown & Williamson Tobacco Corporation, B.A.T Industries P.L.C., British-American Tobacco Company Limited, BAT (U.K. and Export) Limited, Lorillard Tobacco Company, The American Tobacco Company, The Council for Tobacco Research-U.S.A., Inc., and the Tobacco Institute, Inc. and their successors and assigns;<br />"Consumer Price Index" shall mean the Consumer Price Index for All Urban Consumers, for the most recent twelve-month period for which such percentage information is available as published by the Bureau of Labor Statistics of the U.S. Department of Labor.<br />"Court" means the District Court of the State of Minnesota, County of Ramsey, Second Judicial District;<br />"Market Share" means a Settling Defendant's respective share of sales of cigarettes by unit for consumption in the United States during (i) with respect to payments made pursuant to Paragraph II.D. of this Settlement Agreement, the calendar year ending on the date on which the payment at issue is due, regardless of when such payment is made, and (ii) with respect to all other payments made pursuant to this Settlement Agreement, the calendar year immediately preceding the year in which the payment at issue is due, regardless of when such payment is made;<br />"Cigarettes" means any product which contains nicotine, is intended to be burned or heated under ordinary conditions of use, and consists of or contains (i) any roll of tobacco wrapped in paper or in any substance not containing tobacco; or (ii) tobacco, in any form, that is functional in the product, which, because of its appearance, the type of tobacco used in the filler, or its packaging and labeling, is likely to be offered to, or purchased by, consumers as a cigarette; or (iii) any roll of tobacco wrapped in any substance containing tobacco which, because of its appearance, the type of tobacco used in the filler, or its packaging and labeling, is likely to be offered to, or purchased by, consumers as a cigarette described in subparagraph (i) of this paragraph;<br />"Smokeless Tobacco" means any powder that consists of cut, ground, powdered, or leaf tobacco that contains nicotine and that is intended to be placed in the oral cavity;<br />"Tobacco Products" means Cigarettes and Smokeless Tobacco;<br />"Billboards" includes billboards, as well as all signs and placards in arenas and stadiums, whether open-air or enclosed. "Billboards" does not include (1) any advertisements placed on or outside the premises of retail establishments which sell tobacco products, or any retail point-of-sale; and (2) billboards or advertisements in connection with the sponsorship by the Defendants of any entertainment, sporting or similar event, such as NASCAR, that appears in the State of Minnesota as part of a national or multi-state tour;<br />"Children" or "youth" means persons under the age of 18;<br />"Depository," unless otherwise specified, means the Minnesota document depository established by the Court's Order dated June 16, 1995. "Depositories" includes both the Minnesota depository and the Guildford, U.K. document depository established by the Court's Order dated September 6, 1995;<br />"Transit Advertisements" means advertising on private or public vehicles and all advertisements placed at, on or within any bus stop, taxi stand, waiting area, train station, airport or any similar location. "Transit Advertisements" does not include any advertisements placed on or outside the premises of retail establishments licensed to sell Tobacco Products or any retail point-of-sale;<br />"Special State Counsel" means Robins, Kaplan, Miller & Ciresi L.L.P. or a successor, if any; and<br />"Final Approval" means the date on which this Settlement Agreement and the form of State Escrow Agreement are approved by the Court. At the time of such approval, the settlement between the parties is final.<br />SETTLEMENT PAYMENTS<br />Settlement Receipts.<br />The payments to be made by the Settling Defendants under this Settlement Agreement are in satisfaction of all of the State of Minnesota's claims for damages incurred by the State in the year of such payment or earlier years related to the subject matter of this action, including, without limitation, claims for equitable and injunctive relief, claims for health care expenditures and claims for punitive damages, except that no part of any payment under this Settlement Agreement is made in settlement of an actual or potential liability for a fine, penalty (civil or criminal) or enhanced damages.<br />Settlement Payments to the State of Minnesota.<br />Each Settling Defendant severally shall cause to be paid to an account designated in writing by the State of Minnesota in accordance with and subject to paragraph II.E. of this Settlement Agreement, the following amounts: the amount listed for it in Schedule A hereto, such amount representing its share of $240,000,000, to be paid on or before September 5, 1998; pro rata in proportion to its Market Share, its share of $220,800,000, to be paid on or before January 4, 1999; pro rata in proportion to its Market Share, its share of $242,550,000, to be paid on or before January 3, 2000; pro rata in proportion to its Market Share, its share of $242,550,000, to be paid on or before January 2, 2001; pro rata in proportion to its Market Share, its share of $242,550,000, to be paid on or before January 2, 2002; and pro rata in proportion to its Market Share, its share of $121,550,000, to be paid on or before January 2, 2003. The payments made by the Settling Defendants pursuant to this Paragraph shall be adjusted upward by the greater of 3% or the Consumer Price Index applied each year on the previous year, beginning with the payment due to be made on or before January 3, 2000. The payments due to be made by the Settling Defendants pursuant to this Paragraph on or before January 3, 2000, on or before January 2, 2001, on or before January 2, 2002, and on or before January 2, 2003, will also be decreased or increased, as the case may be, in accordance with the formula for adjustments of payments as set forth in Appendix A. The payments due to be made by the Settling Defendants pursuant to this Paragraph on or before September 5, 1998, and on or before January 4, 1999, shall not be subject to inflation escalation and volume adjustments described in the preceding sentences.<br />In the event that any of the Settling Defendants fails to make any payment required of it pursuant to this Paragraph (a "Defaulting Defendant") by the applicable date set forth in this paragraph II.B. (a "Missed Payment"), the State of Minnesota shall provide notice to each of the Settling Defendants of such non-payment. The Defaulting Defendant shall have 15 days after receipt of such notice to pay the Missed Payment, together with interest accrued from the original applicable due date at the prime rate as published in the Wall Street Journal on the latest publication date on or before the date of default plus 3%. If the Defaulting Defendant does not make such payment within such 15-day period, the State of Minnesota shall provide notice to each of the Settling Defendants of such continued non-payment. Any or all of the Settling Defendants (other than the Defaulting Defendant) shall thereafter have 15 days after receipt of such notice to elect (in such Settling Defendant's or such Settling Defendants' sole and absolute discretion) to pay the Missed Payment, together with interest accrued from the original applicable due date at the prime rate as published in the Wall Street Journal on the latest publication date on or before the date of default plus 3%. In the event that the State of Minnesota does not receive the Missed Payment, together with such accrued interest, within such additional 15-day period, all payments required to be made by each of the respective Settling Defendants pursuant to this Paragraph shall at the end of such additional 15-day period be accelerated and shall immediately become due and owing to the State of Minnesota from each Settling Defendant pro rata in proportion to its Market Share; provided, however, that any such accelerated payments (a) shall all be adjusted upward by the greater of (i) the rate of 3% per annum or (ii) the actual total percent change in the CPI, in either instance for the period between January 1 of the year in which the acceleration of payments pursuant to this Paragraph occurs and the date on which such accelerated payments are due pursuant to this subsection, and (b) shall all immediately be adjusted in accordance with the formula for adjustments of payments set forth in Appendix A.<br />Nothing in this Paragraph shall be deemed under any circumstance to create any obligation on the part of any Settling Defendant to pay any amount owed or payable to the State of Minnesota by any other Settling Defendant. All obligations of the Settling Defendants pursuant to this Paragraph are intended to be and shall remain several, and not joint.<br />Public Health Foundation.<br />The Attorney General will propose, and the Settling Defendants have agreed not to oppose, that the Legislature appropriate to a foundation one-half the payments due in September 1998, and in January of the years 1999 through 2003, to be used for such activities as the directors of the foundation may determine will diminish the human and economic consequences of tobacco use. It is contemplated that the directors of the foundation will include public representatives, and representatives of such groups as the American Lung Association, Minnesota Chapter; the University of Minnesota School of Public Health; the Minnesota SmokeFree 2000 Coalition; the American Cancer Society, Minnesota Division; the American Heart Association, Minnesota Chapter; the Association for Non-Smokers' Rights--Minnesota; and the Mayo Clinic Nicotine Dependence Center.<br />Annual Payments.<br />Each of the Settling Defendants agrees that, beginning on December 31, 1998, and annually thereafter on December 31st of each year after 1998 (subject to final adjustment within 30 days), it shall severally cause to be paid to an account designated in writing by the State of Minnesota in accordance with and subject to paragraph II.E. of this Settlement Agreement, pro rata in proportion to its respective Market Share, its share of 2.55% of the following amounts (in billions):<br />YYear<br />11998<br />11999<br />22000<br />22001<br />22002<br />22003<br />There-after<br /><br />1<br />2<br />3<br />4<br />5<br />6<br /><br />AAmt.<br />$4B<br />$4.5B<br />$5B<br />$6.5B<br />$6.5B<br />$8B<br />$8B<br />The payments made by Settling Defendants pursuant to this Paragraph shall be adjusted upward by the greater of 3% or the Consumer Price Index applied each year on the previous year, beginning with the annual payment due on December 31, 1999. Such payments will also be decreased or increased, as the case may be, beginning with the annual payment due on December 31, 1999, in accordance with the formula for adjustments of payments set forth in Appendix A.<br />Payment of Settlement<br />Proceeds.<br />Any payment made pursuant to this Settlement Agreement shall be made to an account designated in writing by the State of Minnesota or the Court, as applicable; provided that after Final Approval, if the Court's approval is challenged by any third party, payments due to be made shall be paid into a special escrow account (the "State Escrow Account"), and held in escrow pursuant to this Section V.B. and the State Escrow Agreement.<br />Adjustments in Event of Federal Legislation.<br />The enactment of federal tobacco- related legislation shall not affect the payments required by this Agreement except as follows:<br />If federal tobacco-related legislation providing for the resolution or other disposition of State Attorney General actions brought against tobacco companies is enacted on or before November 30, 2000, and if such legislation provides for payment(s) by tobacco companies (whether by settlement payment, tax or any other means), all or part of which is made available to States, the State of Minnesota shall elect to receive any funds that are (i) unrestricted as to their use, or (ii) are restricted to any form of health care or to any use related to tobacco (collectively "Federal Settlement Funds"), and Settling Defendants shall receive a dollar-for-dollar offset up to the full amount of payments required under Section II.D of this Agreement for any and all Settlement Funds received by the State of Minnesota, until all Federal Settlement Funds provided however:<br />There shall be no offset to payments required by this Agreement on account of any federal program, subsidies, payments, credits or other aid to the State which are not conditioned or tied to the settlement of a state tobacco-related suit or the relinquishment of state tobacco-related claims;<br />The State relinquishes no rights or benefits under this Agreement except for payments subject to the offset;<br />There are no federally imposed preconditions to the receipt of Federal Settlement Funds other than<br />(i) the settlement of any state tobacco-related lawsuit or the relinquishment of state tobacco-related claims,<br />(ii) actions or expenditures related to tobacco, including but not limited to, education, cessation, control or enforcement, or<br />(iii) actions or expenditures related to health care;<br />If Settling Defendants enter into any pre-verdict settlement agreement (subsequent to the date of this Agreement) of similar litigation brought by a non-federal governmental plaintiff which does not require such an offset, this Section is null and void;<br />If Settling Defendants enter into any pre-verdict settlement agreement (subsequent to the date of this Agreement) of similar litigation brought by a non- federal governmental plaintiff which has an offset term more favorable to the plaintiff, this Settlement Agreement shall, at the option of the Office of the Attorney General of the State of Minnesota, be revised to include a comparable term.<br />Nothing in this section is intended to or shall reduce the total amounts payable to the State under this Agreement by Settling Defendants beyond the amount of Federal Settlement Funds actually received by the State of Minnesota.<br />DISMISSAL OF CLAIMS AND RELEASES<br />State of Minnesota's Dismissal of Claims.<br />Upon approval of this Settlement Agreement by the Court, the Court shall enter a Final Judgment dismissing with prejudice all claims as to all Defendants.<br />This Agreement resolves all claims between the State and the Defendants, except for issues pending before the court pertaining to the discoverability or production of documents for which the Defendants reserve their rights of appeal.<br />State of Minnesota's Release and Discharge.<br />Upon Final Approval, the State of Minnesota shall release and forever discharge all Defendants and their present and former parents, subsidiaries (whether or not wholly owned) and affiliates, and their respective divisions, organizational units, officers, directors, employees, representatives, insurers, suppliers, agents, attorneys and distributors (and the predecessors, heirs, executors, administrators, successors and assigns of each of the foregoing) from any and all manner of civil claims, demands, actions, suits and causes of action, damages whenever incurred, liabilities of any nature whatsoever, including civil penalties, as well as costs, expenses and attorneys' fees, known or unknown, suspected or unsuspected, accrued or unaccrued, whether legal, equitable or statutory ("Claims") that the State of Minnesota (including any of its past, present or future administrators, representatives, employees, officers, attorneys, agents, representatives, officials acting in their official capacities, agencies, departments, commissions, and divisions, and whether or not any such person or entity participates in the settlement), whether directly, indirectly, representatively, derivatively or in any other capacity, ever had, now has or hereafter can, shall or may have, as follows:<br />for past conduct, as to any Claims relating to the subject matter of this action which have been asserted or could be asserted now or in the future in this action or a comparable Federal action by the State; and<br />for future conduct, only as to monetary Claims directly or indirectly based on, arising out of or in any way related to, in whole or in part, the use of or exposure to Tobacco Products manufactured in the ordinary course of business, including without limitation any future claims for reimbursement for health care costs allegedly associated with use of or exposure to Tobacco Products;<br />(such past and future Claims hereinafter referred to as the "Released Claims"); provided, however, that the foregoing shall not operate as a release of any person, party or entity (whether or not a signatory to this Agreement) as to any of the obligations undertaken in this Agreement in connection with a monetary breach or default of this Agreement.<br />The State of Minnesota hereby covenants and agrees that it shall not hereafter sue or seek to establish civil liability against any person or entity covered by the release provided under Paragraph III.B based, in whole or in part, upon any of the Released Claims, and the State of Minnesota agrees that this covenant and agreement shall be a complete defense to any such civil action or proceeding.<br />Settling Defendants' Release and Discharge.<br />Upon Final Approval, Settling Defendants shall release and forever discharge the State of Minnesota (including any of its past, present or future administrators, representatives, employees, officers, attorneys, agents, representatives, officials acting in their official capacities, agencies, departments, commissions, and divisions, and whether or not any such person or entity participates in the settlement) from any and all manner of civil claims, demands, actions, suits and causes of action, damages whenever incurred, liabilities of any nature whatsoever, including costs, expenses, penalties and attorneys' fees, known or unknown, suspected or unsuspected, accrued or unaccrued, whether legal, equitable or statutory, arising out of or in any way related to, in whole or in part, the subject matter of the litigation of this lawsuit, that Settling Defendants (including any of their present and former parents, subsidiaries, divisions, affiliates, officers, directors, employees, witnesses (fact or expert), representatives, insurers, agents, attorneys and distributors and the predecessors, heirs, executors, administrators, successors and assigns of each of the foregoing, and whether or not any such person participates in the settlement), whether directly, indirectly, representatively, derivatively or in any other capacity, ever had, now has or hereafter can, shall or may have.<br />Limited Most-Favored Nation Provision.<br />In partial consideration for the monetary payments to be made by the Settling Defendants pursuant to this Settlement Agreement, the State of Minnesota agrees that if the Settling Defendants enter into any future pre-verdict settlement agreement of other similar litigation brought by a non-federal governmental plaintiff on terms more favorable to such non-federal governmental plaintiff than the terms of this Settlement Agreement (after due consideration of relevant differences in population or other appropriate factors), the terms of this Settlement Agreement shall not be revised except as follows: to the extent, if any, such other pre-verdict settlement agreement includes terms that provide<br />(a) for joint and several liability among the Settling Defendants with respect to monetary payments to be made pursuant to such agreement;<br />(b) a guarantee by the parent company of any of the Settling Defendants or other assurances of payment or creditors' remedies with respect to monetary payments to be made pursuant to such agreement; or<br />(c) for the implementation of non-economic tobacco-related public health measures different from those contained in this Settlement Agreement, then this Settlement Agreement shall, at the option of the Office of the Attorney General of the State of Minnesota, be revised to include terms comparable to such terms.<br />DEFENDANTS' ASSURANCES<br />Settling Defendants agree not to directly or indirectly, including through any third party or affiliate:<br />Oppose the passage of those future Minnesota legislative proposals or administrative rules intended by their terms to reduce tobacco use by children listed on Schedule B. (The foregoing does not prohibit Settling Defendants from resisting enforcement of, or suing for declaratory or injunctive relief with respect to any such legislation or rule on any grounds.)<br />Facially challenge the enforceability or constitutionality of existing Minnesota laws or rules relating to tobacco control, including, but not limited to, Minnesota Statutes Section 461.17 regarding the disclosure of certain ingredients in cigarettes; Minnesota Statutes Sections 461.12, et. seq., and 609.685 regarding the sale of tobacco to minors; Minnesota Statutes Section 325F.77 regarding the distribution of samples; and Minnesota Statutes Section 144.411 et. seq. regarding clean indoor air.<br />Support in Congress or any forum, legislation, rules or policies which would preempt, override, or abrogate or diminish the State's rights or recoveries under this Agreement. Except as specifically provided in the foregoing sentence, nothing in this Agreement shall be deemed to restrain the parties from advocating terms of any national settlement or taking any other positions on issues relating to tobacco. The State and its attorneys specifically reserve the right to continue to litigate or advocate for additional document disclosure beyond that ordered by the Ramsey County District Court, in any forum outside of Minnesota.<br />Settling Defendants' obligation to produce documents in discovery pertaining to enactment or repeal of, or opposition to, state legislation or state executive action relating to tobacco in Minnesota is extended beyond August 17, 1994, to the date of this Agreement, with Settling Defendants required to produce these documents within thirty (30) days of the date of this Agreement.<br />Disclosure of Payments Likely to Affect Public Policy.<br />Each Settling Defendant shall disclose to the Office of the Attorney General and the Office of the Governor, at the times and in the manner provided below, information about the following payments:<br />Any payment to a "lobbyist" or "principal" within the meaning of Minnesota Statutes, Section 10A.01, subdivisions 11 and 28, if Settling Defendant knows or has reason to know that the payment will be used, directly or indirectly, to influence legislative or administrative action, or the official action of state or local government in Minnesota in any way relating to Tobacco Products or their use.<br />Any payment to a third party, if the Settling Defendant knows the payment is partly in consideration for the third party attending, offering testimony at, or participating before a state or local government hearing in Minnesota in any way relating to Tobacco Products or their use; and<br />Any payment (other than a "political contribution" under Minn. Stat. § 10.01, subd. 7, or 2 USC § 431(8)(A)) to, or for the benefit of, a state or local official in Minnesota, whether made directly by a defendant or indirectly through an employee acting in the scope of his employment, affiliate, lobbyist, or other agent acting under the substantial control of a defendant.<br />Disclosures required under this section shall be filed with the Office of the Attorney General and with the Office of the Governor on the first day of January, April, July and October of each year for any and all payments made through the first day of the previous month and shall be transmitted in electronic format or such format as the attorney general may require, with the following information:<br />The name, address, telephone number and e-mail address of the recipient.<br />The amount of each payment described in Paragraph B(1).<br />The aggregate amount of all payments described in Paragraph B(1) to the recipient in the calendar year.<br />Information filed under this section is "public data" within the meaning of the Minnesota Government Data Practices Act.<br />Settling Defendants agree to discontinue all Billboards and Transit Advertisements of Tobacco Products in the State. Settling Defendants shall use their best efforts in cooperation with the State to identify all such Billboards that are located within 1000 feet of any public or private school or playground in the State, and shall provide the State with a preliminary list of the location of all Billboards and stationary Transit Advertisements within 30 days from the date hereof, such list to be finalized within an additional 15 days. Settling Defendants shall, at the earlier of the expiration of applicable contracts or four months from the date the final list is supplied to the State, remove all Billboards and Transit Advertisements for Tobacco Products from within the State, leaving the space unused or used for advertising unrelated to Tobacco Products; or at the option of the State of Minnesota, will allow the State, at its expense, to substitute for the remaining term of the contract, alternative advertising intended to discourage the use of Tobacco Products by children and their exposure to second-hand smoke. The parties also agree to secure the expedited removal of up to 50 Billboards or stationary Transit Advertisements for Tobacco Products designated by the State within 30 days after their designation. Each Settling Defendant which has Billboard advertising in the State shall provide the Court and the Attorney General, or his designee, with the name of a contact person to whom the State may direct inquiries during the time such Billboards and Transit Advertisements are being eliminated, from whom the State may obtain periodic reports as to the progress of their elimination and who will be responsible for ensuring that appropriate action is taken to remove any Billboards that have not been timely eliminated.<br />Settling Defendants shall not make, in the connection with any motion picture made in the United States, or cause to be made any payment, direct or indirect, to any person to use, display, make reference to, or use as a prop any cigarette, cigarette package, advertisement for cigarettes, or any other item bearing the brand name, logo, symbol, motto, selling message, recognizable color or pattern of colors, or any other indicia of product identification identical or similar to, or identifiable with, those used for any brand of domestic tobacco products.<br />On and after December 31, 1998, Settling Defendants shall permanently cease marketing, licensing, distributing, selling or offering, directly or indirectly, including by catalogue or direct mail, in the State of Minnesota, any service or item (other than tobacco products or any item of which the sole function is to advertise tobacco products) which bears the brand name (alone or in conjunction with any other word), logo, symbol, motto, selling message, recognizable color or pattern of colors, or any other indicia of product identification identical or similar to, or identifiable with, those used for any brand of domestic tobacco products.<br />Settling Defendants and the Law Firm of Robins, Kaplan, Miller & Ciresi L.L.P. ("RKM&C") have reached a separate agreement for the payment of the State's costs and attorneys fees. In consideration for said agreement, RKM&C has released the State from its obligation to pay costs and attorneys fees under the Special Attorney Appointment dated May 23, 1994.<br />MISCELLANEOUS PROVISIONS<br />Representations of Parties.<br />The respective parties hereto hereby represent that this Settlement Agreement has been duly authorized and, upon execution, will constitute a valid and binding contractual obligation, enforceable in accordance with its terms, of each of the parties hereto. The State represents that all of its outside counsel that have represented it in this action are, by and through their authorized representatives, signatores to this Settlement Agreement.<br />Court Approval.<br />The Parties agree to submit this Settlement Agreement to the Court for its review and approval on Friday, May 8, 1998. If the Court declines to approve this Settlement Agreement, the Blue Cross Settlement Agreement, the form of State Escrow Agreement, and the form of Blue Cross Escrow Agreement, the matter will be immediately submitted to the jury. If the Court, as a condition of approval or otherwise, requires any change in the Agreements which any signatory is unwilling to make, the case will be immediately submitted to the jury. If before the Court approves the Agreements, any third-party seeks to intervene for the purpose of opposing the Settlement Agreement, the Blue Cross Settlement Agreement, the State Escrow Agreement, and the Blue Cross Escrow Agreement, any Party at its sole election, may withdraw from this Agreement, after first giving notice to the Court and all of the Parties before the jury is dismissed, and submit the case to the jury. If the Court approves the Settlement Agreement as submitted, the Agreement will be final and binding upon all Parties.<br />In the event that there is a challenge to any provision of this Settlement Agreement by anyone other than the Attorney General of the State of Minnesota as of the date of this Agreement, BCBS or Settling Defendants ("a third-party challenge@) after Final Approval, any amounts required to be paid by Settling Defendants pursuant to this Settlement Agreement shall be paid into escrow pursuant to the State Escrow Agreement. If, as a result of such a challenge, any material term of Sections II, III, IV of this Settlement Agreement is modified or rendered unenforceable, the parties shall negotiate an equivalent or comparable substitute term or other appropriate credit or adjustment. In the event that the parties are unable to agree on such a substitute term or appropriate credit or adjustment, then the parties will submit the issue to the Court for resolution, subject to any available appeal rights. In the event that any third-party challenge is made after December 31, 1998, any payments due under Paragraph II.B. shall be made to the State according to the terms of this Settlement Agreement, and only those payments due under Paragraph II.D. shall be placed into escrow as provided above.<br />In the event that the Court determines that there has been a failure of consideration legally sufficient to warrant termination of this Settlement Agreement, then this Settlement Agreement may be terminated by the party adversely affected. In the event of such termination, the action will be reinstated and all decisions of the trial court, and any party's appeal or other rights with respect thereto, will have the same force and effect as if this Settlement Agreement had never been entered into.<br />Obligations Several, Not Joint.<br />All obligations of the Settling Defendants pursuant to this Settlement Agreement are intended to be and shall remain several, and not joint.<br />Headings.<br />The headings of the paragraphs of this Settlement Agreement are not binding and are for reference only and do not limit, expand or otherwise affect the contents of this Settlement Agreement.<br />No Determination or Admission.<br />This Settlement Agreement and any proceedings taken hereunder are not intended to be and shall not in any event be construed as, or deemed to be, an admission or concession or evidence of any liability or any wrongdoing whatsoever on the part of any party hereto or any person covered by the releases provided under paragraphs III.B. and C. hereof. The Settling Defendants specifically disclaim and deny any liability or wrongdoing whatsoever with respect to the allegations and claims asserted against them in this action and enter into this Settlement Agreement solely to avoid the further expense, inconvenience, burden and uncertainty of litigation.<br />Non-Admissibility.<br />The settlement negotiations resulting in this Settlement Agreement have been undertaken by the parties hereto in good faith and for settlement purposes only, and neither this Settlement Agreement nor any evidence of negotiations hereunder shall be offered or received in evidence in this action, or any other action or proceeding, for any purpose other than in an action or proceeding arising under this Settlement Agreement.<br />Amendment; Waiver.<br />This Settlement Agreement may be amended only by a written instrument executed by the Attorney General and the Settling Defendants. The waiver of any rights conferred hereunder shall be effective only if made by written instrument executed by the waiving party. The waiver by any party of any breach of this Settlement Agreement shall not be deemed to be or construed as a waiver of any other breach, whether prior, subsequent or contemporaneous, of this Settlement Agreement.<br />Notices.<br />All notices or other communications to any party to this Settlement Agreement shall be in writing (and shall include telex, telecopy or similar writing) and shall be given to the respective parties hereto at the following addresses. Any party hereto may change the name and address of the person designated to receive notice on behalf of such party by notice given as provided in this paragraph.<br />For the State of Minnesota:<br />Hubert H. Humphrey III<br />Attorney General<br />102 State Capitol<br />St. Paul, MN 55155<br />Fax: 612.297.4193<br />with copies to:<br />Michael V. Ciresi<br />Robins, Kaplan, Miller & Ciresi L.L.P.<br />2800 LaSalle Plaza<br />800 LaSalle Avenue<br />Minneapolis, MN 55402-2015<br />Fax: 612.339.4181<br />Chief Deputy Attorney General<br />State of Minnesota<br />102 State Capitol<br />St. Paul, MN 55155<br />Fax: 612.297.4193<br />For Philip Morris Incorporated:<br />Martin J. Barrington<br />Philip Morris Incorporated<br />120 Park Avenue<br />New York, NY 10017-5592<br />Fax: 212.907.5399<br />With a copy to:<br />Meyer G. Koplow<br />Wachtell, Lipton, Rosen & Katz<br />51 West 52nd Street<br />New York, NY 10019<br />Fax: 212.403.2000<br />For R.J. Reynolds Tobacco Company:<br />Charles A. Blixt<br />General Counsel<br />R.J. Reynolds Tobacco Company<br />401 North Main Street<br />Winston-Salem, NC 27102<br />Fax: 910.741.2998<br />With a copy to:<br />Arthur F. Golden<br />Davis Polk & Wardwell<br />450 Lexington Avenue<br />New York, NY 10017<br />Fax: 212.450.4800<br />For Brown & Williamson Tobacco Corporation:<br />F. Anthony Burke<br />Brown & Williamson Tobacco Corporation<br />200 Brown & Williamson Tower<br />401 South Fourth Avenue<br />Louisville, KY 40202<br />Fax: 502.568.7297<br />With a copy to:<br />Stephen R. Patton<br />Kirkland & Ellis<br />200 East Randolph Dr.<br />Chicago, IL 60601<br />Fax: 312.861.2200<br />For Lorillard Tobacco Company:<br />Arthur J. Stevens<br />Lorillard Tobacco Company<br />714 Green Valley Road<br />Greensboro, NC 27408<br />Fax: 910.335.7707<br />Cooperation.<br />The parties hereto agree to use their best efforts and to cooperate with each other to cause this Settlement Agreement to become effective, to obtain all necessary approvals, consents and authorizations, if any, and to execute all documents and to take such other action as may be appropriate in connection therewith. Consistent with the foregoing, the parties hereto agree that they will not directly or indirectly assist or encourage any challenge to this Settlement Agreement by any other person. All parties hereto agree to support the integrity and enforcement of the terms of this Settlement Agreement.<br />Governing Law.<br />This Settlement Agreement shall be governed by the laws of the State of Minnesota, without regard to the conflicts of law rules of such state.<br />Construction.<br />None of the parties hereto shall be considered to be the drafter of this Settlement Agreement or any provision hereof for the purpose of any statute, case law or rule of interpretation or construction that would or might cause any provision to be construed against the drafter hereof.<br />Severability.<br />Subject to the provisions of Paragraph V.B., the terms of this Agreement are severable. If any term of this Agreement is found to be unlawful, the remaining terms shall remain in full force and effect, and the parties agree to negotiate a substitute term of equivalent value.<br />Intended Beneficiaries.<br />This action was brought by the State of Minnesota, through its Attorney General, and by Blue Cross to recover certain monies and to promote the health and welfare of the people of Minnesota. No portion of this Settlement Agreement shall provide any rights to, or be enforceable by, any person or entity that is neither a party hereto nor a person encompassed by the releases provided in paragraphs III.B. and C. of this Settlement Agreement. Except as expressly provided in this Settlement Agreement, no portion of this Settlement Agreement shall bind any non-party or determine, limit or prejudice the rights of any such person or entity. None of the rights granted or obligations assumed under this Settlement Agreement by the parties hereto may be assigned or otherwise conveyed without the express prior written consent of all of the parties hereto.<br />Counterparts.<br />This Settlement Agreement may be executed in counterparts. Facsimile or photocopied signatures shall be considered as valid signatures as of the date hereof, although the original signature pages shall thereafter be appended to this Settlement Agreement.<br />IN WITNESS WHEREOF, the parties hereto, through their fully authorized representatives, have agreed to this Comprehensive Settlement Agreement and Release as of this 8th day of May, 1998.<br />STATE OF MINNESOTA, acting by and through Hubert H. Humphrey III, its duly elected and authorized Attorney General<br />By:<br />Hubert H. Humphrey III<br />Attorney General<br />Lee E. Sheehy<br />Chief Deputy Attorney General<br />Eric A. Johnson<br />Executive Assistant to the Attorney General<br />Thomas F. Pursell<br />Senior Counsel to the Attorney General<br />D. Douglas Blanke<br />Director of Consumer Policy<br />COUNSEL TO THE STATE OF MINNESOTA<br />By:<br />Michael V. Ciresi<br />Robins, Kaplan, Miller & Ciresi L.L.P.<br />PHILIP MORRIS INCORPORATED<br />By:<br />Meyer G. Koplow<br />Counsel<br />By:<br />Martin J. Barrington<br />General Counsel<br />R.J. REYNOLDS TOBACCO COMPANY<br />By:<br />D. Scott Wise<br />Counsel<br />By:<br />Charles A. Blixt<br />General Counsel<br />BROWN & WILLIAMSON TOBACCO CORPORATION<br />By:<br />Stephen R. Patton<br />Counsel<br />By:<br />F. Anthony Burke<br />Vice President and General Counsel<br />LORILLARD TOBACCO COMPANY<br />By:<br />Arthur J. Stevens<br />Senior Vice President & General Counsel<br />SCHEDULE A<br />AMOUNTS PAYABLE BY SETTLING DEFENDANTS ON OR BEFORE SEPTEMBER 5, 1998 PURSUANT TO PARAGRAPH II.B. OF THE SETTLEMENT AGREEMENT<br />Date<br />9/5/98<br />Settling Defendants<br />Philip Morris Incorporated<br />$ 163,200,000<br />R.J. Reynolds Tobacco Company<br />$ 16,320,000<br />Brown & Williamson Tobacco Corporation<br />$ 42,960,000<br />Lorillard Tobacco Company<br />$ 17,520,000<br />Total Amount<br />$ 240,000,000<br />SCHEDULE B<br />Potential Future Legislation to Reduce Tobacco Use by Children<br />· Legislation to expand the self-service-sale restrictions of the youth access to tobacco law and to remove the current exception for sales of cigars.<br />· Legislation to clarify the current youth access law provision on vending machines, making clear that machines equipped with automatic locks or that use tokens are vending machines within the meaning of the law.<br />· Legislation providing enhanced or coordinated funding for enforcement efforts under sales-to- minors provisions of the criminal code or the youth access statute and ordinances.<br />· Legislation to encourage or support the use of technology to increase effectiveness of age-of- purchase laws, such as, without limitation, the use of programmable scanners or scanners to read drivers' licenses.<br />· Legislation or rules restricting the wearing, carrying or display of tobacco indicia in school- related settings, including, without limitation, in school facilities, on school premises, or in connection with school-sponsored activities.<br />· Legislation to create or stiffen non-monetary incentives for youth not to smoke, such as expansion of youth community service programs.<br />APPENDIX A<br />FORMULA FOR CALCULATING STATE OF MINNESOTA VOLUME ADJUSTMENTS<br />Any payment that by the terms of the Settlement Agreement is to be adjusted pursuant to this Appendix (the "Applicable Base Payment") shall be adjusted pursuant to this Appendix in the following manner:<br />(A) in the event the aggregate number of units of Tobacco Products sold domestically by the Settling Defendants in the Applicable Year (as defined hereinbelow) (the "Actual Volume") is greater than the aggregate number of units of Tobacco Products sold domestically by the Settling Defendants in 1997 (the "Base Volume"), the Applicable Base Payment shall be multiplied by the ratio of the Actual Volume to the Base Volume;<br />(B) in the event the Actual Volume is less than the Base Volume,<br />(i) the Applicable Base Payment shall be multiplied by the ratio of the Actual Volume to the Base Volume, and the resulting product shall be divided by 0.98; and<br />(ii) if a reduction of the Applicable Base Payment results from the application of subparagraph (B)(i) of this Appendix, but the Settling Defendants' aggregate net operating profits from domestic sales of Tobacco Products for the Applicable Year (the "Actual Net Operating Profit") is greater than the Settling Defendants' aggregate net operating profits from domestic sales of Tobacco Products in 1997 (the "Base Net Operating Profit") (such Base Net Operating Profit being adjusted upward by the greater of the rate of 3% per annum or the actual total percent change in the Consumer Price Index, in either instance for the period between January 1, 1998 and the date on which the payment at issue is made), then the amount by which the Applicable Base Payment is reduced by the application of subparagraph (B)(i) shall be reduced (but not below zero) by 2.55% of 25% of such increase in such profits. For purposes of this Appendix, "net operating profits from domestic sales of Tobacco Products" shall mean net operating profits from domestic sales of Tobacco Products as reported to the United States Securities and Exchange Commission ("SEC") for the Applicable Year or, in the case of a Settling Defendant that does not report profits to the SEC, as reported in financial statements prepared in accordance with generally accepted accounting principles and audited by a nationally recognized accounting firm. The determination of the Settling Defendants' aggregate net operating profits from domestic sales of Tobacco Products shall be derived using the same methodology as was employed in deriving such Settling Defendants' aggregate net operating profits from domestic sales of Tobacco Products in 1997. Any increase in an Applicable Base Payment pursuant to this subparagraph B(ii) shall be payable within 120 days after the date that the payment at issue was required to be made.<br />(C) "Applicable Year" means (i) with respect to the payments made pursuant to paragraph II.D of the Settlement Agreement, the calendar year ending on the date on which the payment at issue is due, regardless of when such payment is made; and (ii) with respect to all other payments made pursuant to this Settlement Agreement, the calendar year immediately preceding the year in which the payment at issue is due, regardless of when such payment is made.<br /><br /><SPAN style="DISPLAY: none"><br />Anahtar kelimeler<br />adult dating sex<br />adult sex personals<br />adult dating and sex<br />adult dating for sex<br />adult dating sex personals<br />adult sex dating com<br />adult sex dating service<br />adult sex dating services<br />adult sex dating sites<br />adult sex dating uk<br />adult sex dating websites<br />adult sex online dating<br />amateur adult dating sex<br />best adult sex dating<br />married adult sex dating<br />www adult sex dating<br />www adult sex dating com<br />adult alternative dating sex<br />adult dating & sex<br />adult dating sex contacts<br />adult dating sites for sex<br />adult group sex dating<br />adult sex dating co uk<br />adult sex dating merseyside<br />adult sex dating sites for pennsylvania<br />discreet adult sex dating<br />moes xxx livecams adult online dating xxx sites sex cam<br />Anahtar kelimeler<br />adult<br />dating<br />personals<br />sex<br />singles<br />adult dating<br />adult dating service<br />adult dating services<br />adult erotic<br />adult finder<br />adult friend finder<br />adult game<br />adult games<br />adult online dating<br />adult personals<br />adult sex<br />alternative dating<br />asian dating<br />asian sex<br />black dating<br />casual sex<br />christian dating<br />dating agency<br />dating girls<br />dating personals<br />dating service<br />dating services<br />dating sites<br />dating women<br />friend adult<br />friends dating<br />internet dating<br />interracial dating<br />lesbian dating<br />lesbian sex<br />mature sex<br />online dating<br />online dating service<br />personals sex<br />russian dating<br />sex dating<br />sex girls<br />sex stories<br />sex women<br />single dating<br />singles dating<br />swingers<br />adult asian sex<br />adult chatrooms<br />adult contacts sex<br />adult date<br />adult dates<br />adult dating asian<br />adult dating personals<br />adult dating services online<br />adult dating sites<br />adult dating uk<br />adult dating website<br />adult friends<br />adult lesbian sex<br />adult phone sex<br />adult single dating<br />adult singles<br />adult singles dating<br />adult sites sex<br />adult women sex<br />adult xxx dating<br />adultdating<br />casual sex dating<br />dating and sex<br />dating for sex<br />dating friend finder<br />dating romance<br />intimate dating<br />looking for sex<br />married dating<br />match dating<br />online sex dating<br />personals dating sex<br />sex date<br />sex dates<br />sex dating service<br />sex dating sites<br />sexy dating<br />uk dating sex<br />webcam dating<br />women looking for sex<br />adult 100 sex<br />adult casual sex<br />adult classifieds sex<br />adult contact sex<br />adult date sex<br />adult dating classifieds<br />adult dating clubs<br />adult dating contacts<br />adult dating fun<br />adult dating mature<br />adult dating porn<br />adult dating swinger<br />adult dating swingers<br />adult dating toronto<br />adult dating web sites<br />adult dating webcam<br />adult dating websites<br />adult find sex<br />adult friend finder sex<br />adult friends sex<br />adult girls sex<br />adult local sex<br />adult married sex<br />adult match sex<br />adult meet sex<br />adult men sex<br />adult singles sex<br />adult swingers sex<br />adults sex dating<br />asian dating sex<br />lesbian dating sex<br />local adult dating<br />local dating sex<br />phone dating sex<br />teen dating sex<br />adult matchmaking sex<br /><br /><br /><br /><br /></span>Settlementhttp://www.blogger.com/profile/07780234485860161985noreply@blogger.com0