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MODIFICATION AGREEMENT CONCERNING ELIGIBILITY OF NEW MEMBER STATES FOR SUPPLEMENTAL PAYMENTS AND RELATED MATTERS
dated as of
[], 2012
to
ANTI-CONTRABAND AND ANTI -COUNTERFEIT AGREEMENT AND GENERAL RELEASE
dated as of
July 9, 2004
among
PHILIP MORRIS INTERNATIONAL INC.,
PHILIP MORRIS PRODUCTS INC.,
PHILIP MORRIS DUTY FREE INC., and PHILIP MORRIS WORLD TRADE SARL
THE EUROPEAN COMMUNITY REPRESENTED BY THE EUROPEAN COMMISSION
AND
EACH MEMBER STATE LISTED ON THE SIGNATURE PAGES THERETO

This Modification Agreement Concerning Eligibility of New Member States for Supplemental Payments and Related Matters (the Modification Agreement ) is made between Philip Morris International Inc., PMPI LLC (as successor to Philip Morris Products Inc.), Philip Morris World Trade SARL (collectively "Philip Morris International"), Philip Morris Duty Free Inc., an affiliate of Altria Group, Inc., the European Union represented by the European Commission and each Member State of the European Union party to the Cooperation Agreement dated 9 July 2004 (the Cooperation Agreement) (together, the Parties).

The Parties hereby agree as follows:

Article 1. Amendments.

The following amendments shall be made to the Cooperation Agreement:

Article 1 Definitions

1. The definition of "Baseline Amount" is amended by

(a) replacing the phrase "90 million Cigarettes" with the phrase "450 million Philip Morris Cigarettes";

(b) striking the words "which is half of the total combined Contraband Philip Morris Cigarettes seized by the Member States who were Member States on January 1, 2004, during the calendar years ended December 31, 2001, and December 31, 2002";

(c) striking the phrase "(s) and" so that the the final sentence of the definition reads "The Baseline Amount may be amended pursuant to Section 4.01 (t) of this Agreement".

Article 4
Anti-Contraband and Anti-Counterfeit Cooperation

1. Clause (ii) of Section 4.01(f) is amended to delete the phrase "that were Member States on January 1, 2004."

2. Clause (ii) of Section 4.01(g) is amended to delete the phrase "that were Member States on January 1, 2004."

3. Sections 4.01(o), (p), (q), and (s) are stricken in their entirety.

4. A new Section 4.01(tt) is added:

"If, in any calendar year, seizures in New Member States that qualify for Supplemental Payments under subsections (f) and (g) above are higher than a multiple of the annual average of all New Member State seizures of Philip Morris Cigarettes between 2008 and 2011, Philip Morris International and the EC shall meet as soon as practicable to discuss the adoption of appropriate measures to ensure the continued functioning of the Agreement, including, if necessary, the amendment or suspension of Philip Morris International's obligations under Article 4 with respect to New Member States."

Article 2. Effective date.

This Modification Agreement shall come into effect the day the signature pages of all Parties are exchanged between Philip Morris International, Philip Morris Duty Free, Inc. and the Relevant Administrations. Upon entry into effect, the Parties shall apply this Modification Agreement retroactively to 1 July 2012 for all purposes, including seizures that occur on or after 1 July 2012 and qualification under the new baseline amount, which shall de deemed modified as of 1 July 2012.

IN WITNESS WHEREOF, the Parties hereto have caused this agreement to be duly executed by their respective authorized officers as of the effective date of this Modification Agreement.