Common use of Certain Employee Benefits Matters Clause in Contracts

Certain Employee Benefits Matters. (a) All of the Business Employees who are actively employed (including those on vacation) on the Closing Date shall be offered employment on an "at will" basis with the Purchaser on such date, and such individuals who accept such offer on such date shall be referred to as "Transferred Employees." Each such offer of employment shall be (i) at the same salary or hourly wage rate and position in effect immediately prior to the Closing Date and (ii) at the same location or within 20 miles from the location of such employment immediately prior to the Closing Date. Purchaser shall also offer employment on an "at will" basis to each Business Employee who is temporarily absent from active employment on the Closing Date upon termination of such temporary absence within six months following the Closing Date, provided that such individual is able to perform the essential functions of the position he or she previously held with the Sellers prior to such absence, and any such individual shall be treated as a "Transferred Employee" from and after his or her date of employment with Purchaser. For a period of 12 months following the Closing Date, Purchaser shall provide benefits to the Business Employees that, in the aggregate, (i) are substantially equivalent to those provided by Purchaser to its other similarly situated employees as of the Closing Date and (ii) are no less favorable than those provided by the Sellers and their Subsidiaries under the Benefit Plans (other than benefits relating to stock options or other equity-based compensation) to such Business Employees immediately prior to the Closing Date. Purchaser shall cause Purchaser's employee benefit plans and arrangements (including, but not limited to, all "employee benefit plans" within the meaning of Section 3(3) of ERISA and all plans, programs, policies and employee fringe benefit programs, including vacation policies), to the extent Purchaser makes them available to Business Employees, to recognize, solely for the purposes of determining the vesting of benefits and participation eligibility (but not for benefit accrual), all service by Transferred Employees with the Sellers, including service with predecessor employers, to the extent that such service was recognized by the analogous benefit plans of Purchaser, provided that such recognition does not result in any duplication of benefits. Individuals who have terminated employment with Sellers prior to the Closing Date and are subsequently hired by Purchaser and its Affiliates will not be entitled to any service recognition under this paragraph. Transferred Employees shall also be given credit for any deductible, co-payment amounts or out-of-pocket expenses paid in respect of the plan year in which the Closing occurs, to the extent that, following the Closing, they participate in any corresponding plan maintained or sponsored by Purchaser for which deductibles or co-payments are required. (b) Purchaser agrees that any pre-existing condition exclusions or waiting periods or evidence of insurability requirements imposed under Purchaser's welfare benefit plans will be waived with respect to any Transferred Employee and his or her covered dependents to the same extent that such exclusions, waiting periods or evidence of insurability did not preclude his or her participation in the equivalent plan of the Sellers. (c) Sellers and their ERISA Affiliates shall be exclusively responsible for complying with COBRA with respect to their employees with respect to any "qualifying event" as such term is defined in COBRA, occurring on or prior to the Closing Date. (d) Seller agrees to cause the accrued benefits and account balances of Transferred Employees under the Star Tobacco 401(k) Plan ("Sellers' 401(k) Plan") to be 100% vested effective as of the Closing Date. (e) Effective as of the Closing Date, Purchaser shall establish for the benefit of the Transferred Employees who, immediately prior to the Closing Date were participants in the Sellers' 401(k) Plan, a tax-qualified defined contribution plan or shall designate a pre-existing tax-qualified defined contribution plan, (in either case, "Purchaser's Plan"), which shall qualify as a cash or deferred plan under Section 401(k) of the Code and shall provide benefits only with respect to service after the Closing Date. Service with Seller or any prior employer recognized under the Sellers' 401(k) Plan shall be recognized for eligibility, vesting and all other purposes under Purchaser's Plan. As soon as practicable after Purchaser's Plan is determined to be a tax qualified plan, Transferred Employees shall be permitted to make a rollover contribution from the Sellers' 401(k) Plan to Purchaser's Plan. (f) Purchaser shall be liable for all obligations with respect to claims of Transferred Employees for (i) workers compensation for incidents occurring on or after the Closing Date and (ii) for claims of such Transferred Employees that arise from or relate to facts, circumstances or conduct that occurred or are deemed to occur on or after the Closing Date. With respect to Transferred Employees, (i) a claim for health benefits (including, without limitation, claims for medical, prescription drug and dental expenses) will be deemed to have been incurred on the date on which the related medical service or material was rendered to or received by the Transferred Employee claiming such benefit, (ii) a claim for sickness or disability benefits based on an injury or illness occurring prior to the Closing Date will be deemed to have been incurred prior to the Closing Date, and (iii) in the case of any claim for benefits other than health benefits and sickness and disability benefits (e.g., life insurance benefits), a claim will be deemed to have been incurred upon the occurrence of the event giving rise to such claims. (g) Prior to Closing, and in any event within 90 days of the date of this Agreement, Purchaser shall, after consultation with the Sellers, establish a Retention Plan (the "Retention Plan") in an amount equal to $2,000,000 in the aggregate for payment to the Transferred Employees (i) who are employed by Purchaser or its Affiliates on the first anniversary of the Closing Date or (ii) whose employment with Purchaser or its Affiliates has been terminated by Purchaser or its Affiliates other than for Cause prior to the first anniversary of the Closing Date. The aggregate of $2,000,000 of payments shall be allocated among the Transferred Employees in the manner set forth in the Retention Plan, except that in the event one or more Transferred Employees terminates their employment prior to the first anniversary of the Closing Date or the employment of one or more Transferred Employees is terminated by Purchaser or its Affiliates for Cause prior to such first anniversary, the $2,000,000 initially allocated under the Retention Plan shall be reduced by the amounts allocated to such Transferred Employees. As promptly as practicable after establishing the Retention Plan, and in any event within 90 days of the date of this Agreement, Purchaser shall deliver to Parent a copy of the Retention Plan and the Sellers shall be entitled to disclose to the Transferred Employees the terms of the Retention Plan. For purposes of the Retention Plan, "Cause" shall mean the termination of the employee's employment by reason of any one or more of the following: (i) failure, in the reasonable judgment of Purchaser, of the employee to satisfactorily perform the employee's duties; (ii) fraud or dishonesty in the performance of the employee's duties; or (iii) a breach of any of the policies of "General Conduct" contained in the Employee Handbook of Star Tobacco & Pharmaceuticals, Inc. to the extent such breach would be grounds for a termination for cause under such Employee Handbook. A failure of an employee to relocate the place of his employment beyond 20 miles from the current location of such employment at the request of Purchaser will not constitute "Cause" for termination of employment.

Certain Employee Benefits Matters. (a) All Effective as of the Business Employees who are actively employed (including those on vacation) on Closing Date, Buyer shall offer employment to each Transferred Employee at the Closing Date shall be offered employment on an "at will" basis with the Purchaser on such datesalary or wage level, as applicable, and with employee benefits that, in the aggregate per employee, are substantially comparable to those provided by Seller and to such individuals who accept such offer on such date shall be referred to as "Transferred Employees." Each such offer of employment shall be (i) at the same salary or hourly wage rate and position in effect immediately prior to the Closing Date and (ii) at the same location or within 20 miles from the location of such employment Employee immediately prior to the Closing Date. Purchaser shall also offer employment on an "at will" basis to each Business Employee who is temporarily absent from active employment on For the one-year period following the Closing Date upon termination of such temporary absence within six months following (the “Continuation Period”), Buyer agrees to (i) provide severance benefits to Transferred Employees that are no less favorable to Transferred Employees than the severance benefits program in place immediately prior to the Closing Date, provided that Date for salaried and hourly employees employed in connection with the operation of the Business and (ii) otherwise provide each Transferred Employee (whether or not such individual is able returns to perform active employment in the essential functions of the position he or she previously held Business) with the Sellers prior to such absence, and any such individual shall be treated as a "Transferred Employee" from and after his or her date of employment with Purchaser. For a period of 12 months following the Closing Date, Purchaser shall provide employee benefits to the Business Employees that, in the aggregateaggregate per employee, (i) are substantially equivalent comparable to those provided by Purchaser to Seller and its other similarly situated employees as of the Closing Date and (ii) are no less favorable than those provided by the Sellers and their Subsidiaries under the Benefit Plans (other than benefits relating to stock options or other equity-based compensation) to such Business Employees Transferred Employee immediately prior to the Closing Date. Purchaser Except to the extent it would result in the duplication of benefits, Buyer shall cause Purchaser's Buyer’s employee benefit plans and arrangements (including, but not limited to, all "employee benefit plans" within the meaning of Section 3(3) of ERISA and all plans, programs, policies and employee fringe benefit programs, including vacation policies), to the extent Purchaser makes them available to Business Employees, to recognize, solely for the purposes purpose of determining the vesting of benefits and participation eligibility (but not for benefit accrual)eligibility, all service by Transferred Employees with the SellersSeller or any of its Subsidiaries, including service with predecessor employers, employers to the extent that such service was recognized by the analogous benefit plans of PurchaserSeller, provided any of its Subsidiaries or Seller such that such recognition does not result in any duplication no break or interruption of benefits. Individuals who employment or participation shall be deemed to have terminated employment occurred with Sellers prior respect to the Closing Date and are subsequently hired by Purchaser and its Affiliates will not be entitled to any service recognition under this paragraph. Transferred Employees shall also be given credit for any deductible, co-payment amounts or out-of-pocket expenses paid in respect of the plan year in which the Closing occurs, to the extent that, following the Closing, they participate in any corresponding plan maintained or sponsored by Purchaser for which deductibles or co-payments are requiredEmployees. (b) Purchaser Buyer agrees that any pre-existing condition exclusions or waiting periods or evidence of insurability requirements imposed under Purchaser's Buyer’s welfare benefit plans will be waived with respect to any Transferred Employee and his or her covered dependents and Buyer (or Buyer’s employee benefit plans) shall assume all liabilities relating to all claims by Transferred Employees (and their dependents and beneficiaries) for benefits after the same extent that such exclusionsClosing Date under all medical, waiting periods or evidence of insurability did not preclude his or her participation in the equivalent plan of the Sellersdental, employee assistance, life, accidental death and dismemberment, dependent life, short- and long-term disability plans. (c) Sellers and their ERISA Affiliates Buyer shall be exclusively responsible for complying with COBRA provide continuation coverage to Transferred Employees with respect to their employees with respect to any "whom a qualifying event" event occurs as such term is defined in COBRA, occurring on a result of or prior to following the Closing Dateof the transaction contemplated by this Agreement in compliance with the provisions of Code Section 4980B and ERISA Section 601 et seq. (d) Seller Buyer will establish a 401(k) plan and Buyer agrees to cause the accrued benefits and account balances Buyer’s 401(k) plan to accept direct rollover contributions on behalf of Transferred Employees under the Star Tobacco from Seller’s and/or its parent’s 401(k) plan, including outstanding loans. (e) On the Closing Date, Buyer shall establish a defined benefit retirement plan that complies with Sections 401(a) and 501(a) of the Code (“Buyer’s Defined Benefit Plan”) for the benefit of the Transferred Employees that are members of the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL-CIO-CLC on behalf of Local Union No. 9455-05 (the “Union Employees”) and that participated in a defined benefit plan maintained by Seller (“Seller’s Defined Benefit Plan”) immediately prior to the Closing. The Union Employees shall be eligible to participate in Buyer’s Defined Benefit Plan ("Sellers' 401(k) Plan") to be 100% vested in accordance with the terms set forth in the Agreement by and between Seller and United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL-CIO-CLC on behalf of Local Union 9455-05, effective April 22, 2006 through April 20, 2009, and the terms of this Agreement; taking into account the value of each Union Employee’s frozen accrued benefit under Seller’s Defined Benefit Plan as of the Closing Date. (e) Effective as of the Closing Date, Purchaser shall establish for the benefit of the Transferred Employees who, immediately prior to the Closing Date were participants in the Sellers' 401(k) Plan, a tax-qualified defined contribution plan or shall designate a pre-existing tax-qualified defined contribution plan, (in either case, "Purchaser's Plan"), which shall qualify as a cash or deferred plan under Section 401(k) of the Code and shall provide benefits only with respect to service after the Closing Date. Service with Seller or any prior employer recognized under the Sellers' 401(k) Plan shall be recognized for eligibility, vesting and all other purposes under Purchaser's Plan. As soon as practicable after Purchaser's Plan is determined to be a tax qualified plan, Transferred Employees shall be permitted to make a rollover contribution from the Sellers' 401(k) Plan to Purchaser's Plan. (f) Purchaser Buyer shall be liable for all obligations with respect to claims of Transferred Employees for (i) workers compensation for incidents occurring on or after the Closing Date and (ii) for claims of such Transferred Employees that arise from or relate to facts, circumstances or conduct that occurred or are deemed to occur on or arising after the Closing Date. With respect to Transferred Employees, (i) a claim for health benefits (including, without limitation, claims for medical, prescription drug and dental expenses) will be deemed to have been incurred on the date on which the related medical service or material was rendered to or received by the Transferred Employee claiming such benefit, (ii) a claim for sickness or disability benefits based on an injury or illness occurring prior to the Closing Date will be deemed to have been incurred prior to the Closing Date, and (iii) in the case of any claim for benefits other than health benefits and sickness and disability benefits (e.g., life insurance benefits), a claim will be deemed to have been incurred upon the occurrence of the event giving rise to such claims. (g) Prior to Within thirty (30) days after Closing, Parent shall pay to certain Transferred Employees, the identities and the individual amounts of which have been agreed to between Parent and the President of Buyer, an aggregate amount of $189,600.00 as one-time bonus compensation. (h) Nothing contained in this Agreement shall confer upon any Transferred Employee any rights with respect to continuance of employment by Buyer, nor shall any provision of this Agreement create any third party beneficiary rights in any event within 90 days of the date of this AgreementTransferred Employee, Purchaser shallany beneficiary or dependents thereof, after consultation with the Sellers, establish a Retention Plan (the "Retention Plan") in an amount equal to $2,000,000 in the aggregate for payment to the Transferred Employees (i) who are employed by Purchaser or its Affiliates on the first anniversary of the Closing Date or (ii) whose employment with Purchaser or its Affiliates has been terminated by Purchaser or its Affiliates other than for Cause prior to the first anniversary of the Closing Date. The aggregate of $2,000,000 of payments shall be allocated among the Transferred Employees in the manner set forth in the Retention Plan, except that in the event one or more Transferred Employees terminates their employment prior to the first anniversary of the Closing Date or the employment of one or more Transferred Employees is terminated by Purchaser or its Affiliates for Cause prior to such first anniversary, the $2,000,000 initially allocated under the Retention Plan shall be reduced by the amounts allocated to such Transferred Employees. As promptly as practicable after establishing the Retention Plan, and in any event within 90 days of the date of this Agreement, Purchaser shall deliver to Parent a copy of the Retention Plan and the Sellers shall be entitled to disclose to the Transferred Employees the terms of the Retention Plan. For purposes of the Retention Plan, "Cause" shall mean the termination of the employee's employment by reason of any one or more of the following: (i) failure, in the reasonable judgment of Purchaser, of the employee to satisfactorily perform the employee's duties; (ii) fraud or dishonesty in the performance of the employee's duties; or (iii) a breach of any of the policies of "General Conduct" contained in the Employee Handbook of Star Tobacco & Pharmaceuticals, Inc. to the extent such breach would be grounds for a termination for cause under such Employee Handbook. A failure of an employee to relocate the place of his employment beyond 20 miles from the current location of such employment at the request of Purchaser will not constitute "Cause" for termination of employmentcollective bargaining representative thereof.

Certain Employee Benefits Matters. (a) All of the Business Employees who are actively employed (including those on vacation) on the Closing Date shall be offered employment on an "at will" basis with the Purchaser on such date, and such individuals who accept such offer on such date shall be referred Prior to as "Transferred Employees." Each such offer of employment shall be (i) at the same salary or hourly wage rate and position in effect immediately prior to the Closing Date and (ii) at the same location or within 20 miles from the location of such employment immediately prior to the Closing Date. Purchaser shall also offer employment on an "at will" basis to each Business Employee who is temporarily absent from active employment on the Closing Date upon termination of such temporary absence within six months following the Closing Date, provided that such individual is able to perform the essential functions of the position he or she previously held with the Sellers prior to such absence, and any such individual shall be treated as a "Transferred Employee" from and after his or her date of employment with Purchaser. For a period of 12 months following the Closing Date, Purchaser shall provide benefits to the Business Employees thatoffer employment, in the aggregate, (i) are substantially equivalent to those provided by Purchaser to its other similarly situated employees effective as of the Closing Date Date, to some or all of the employees of Seller (the “Transferred Employees”) on such terms and conditions determined by Purchaser. Purchaser agrees to provide Seller with a list of Transferred Employees no later than two (ii2) are no less favorable than those provided by the Sellers and their Subsidiaries under the Benefit Plans (other than benefits relating to stock options or other equity-based compensation) to such Business Employees immediately Days prior to the Closing Date. Purchaser shall cause Purchaser's employee benefit plans and arrangements (including, but not limited to, all "employee benefit plans" within the meaning of Section 3(3) of ERISA and all plans, programs, policies and employee fringe benefit programs, including vacation policies), to the extent Purchaser makes them available to Business Employees, to recognize, solely for the purposes of determining the vesting of benefits and participation eligibility (but not for benefit accrual), all service by Transferred Employees with the Sellers, including service with predecessor employers, to the extent that such service was recognized by the analogous benefit plans of Purchaser, provided that such recognition does not result in any duplication of benefits. Individuals who have terminated employment with Sellers prior to the Closing Date and are subsequently hired by Purchaser and its Affiliates will not be entitled to any service recognition under this paragraph. Transferred Employees shall also be given credit for any deductible, co-payment amounts or out-of-pocket expenses paid in respect of the plan year in which the Closing occurs, to the extent that, following the Closing, they participate in any corresponding plan maintained or sponsored by Purchaser for which deductibles or co-payments are required. (b) With regard to the Transferred Employees, if Purchaser agrees determines, in its sole discretion, within a period of six (6) months from the Closing Date, that it does not elect to retain any pre-existing condition exclusions Transferred Employee, Seller and/or its parent company, United Components, Inc., shall be solely responsible for paying any severance benefits to the first twenty (20) of such Transferred Employees who are terminated by Purchaser in the amount to which such employees would have been entitled had such employees remained employees of Seller; provided, however, that Seller and/or its parent company, United Components, Inc., shall be solely responsible for paying the severance benefits to Bxxxx Xxxx if his employment is terminated by Purchaser before the first anniversary of the Closing Date. (c) If on the Closing Date any Transferred Employee shall be on short term disability or waiting periods leave, Seller shall pay all benefits due such employee through the remainder of the disability or evidence leave period in effect as of insurability requirements imposed the Closing Date. (d) Purchaser shall be solely responsible for claims relating to continuation coverage under Purchaser's welfare benefit plans will be waived Section 4980B of the Code attributable to “qualifying events” with respect to any Transferred Employee and his or her covered beneficiaries and dependents to the same extent that such exclusions, waiting periods or evidence of insurability did not preclude his or her participation in the equivalent plan of the Sellers. (c) Sellers and their ERISA Affiliates shall be exclusively responsible for complying with COBRA with respect to their employees with respect to any "qualifying event" as such term is defined in COBRA, occurring occur on or prior to the Closing Date. (d) Seller agrees to cause the accrued benefits and account balances of Transferred Employees under the Star Tobacco 401(k) Plan ("Sellers' 401(k) Plan") to be 100% vested effective as of after the Closing Date. (e) Effective Purchaser shall notify Seller if a Transferred Employee incurs an “employment loss,” as such term is defined in the Federal Worker Adjustment and Retraining Notification Act, within the ninety (90) day period following the Closing Date. Such notice shall be provided to Seller within five (5) Business Days following the date of such Transferred Employee’s employment loss. (f) As soon as practicable after the Closing Date, Purchaser shall establish for a 401(k) retirement plan that complies with Sections 401(a) and 501(a) of the benefit Code (“Purchaser’s 401(k) Plan”) and, as soon as practicable after the Closing Date, Purchaser agrees to accept a transfer of assets related to current or former employees of the Business, including the Transferred Employees who(the “Business Employees”) from Seller’s and/or its parent’s 401(k) plan (the “Seller’s 401(k) Plan”). In connection with such transfer, immediately prior Seller shall cause the assets of the trust under Seller’s 401(k) Plan equal to the Closing Date were participants in aggregate benefits accrued (including unvested benefits) under Seller’s 401(k) Plan by Business Employees to be valued and transferred to the Sellers' trust under Purchaser’s 401(k) Plan. The assets to be transferred from the trust under Seller’s 401(k) Plan, a tax-qualified defined contribution plan or if any, shall designate a pre-existing tax-qualified defined contribution planbe in the form of cash, (securities and other property; provided, however, that any outstanding loans shall be transferred in either case, "Purchaser's Plan"), which shall qualify as a cash or deferred plan kind. The actual amount transferred from the trust under Section 401(k) of the Code and shall provide benefits only with respect to service after the Closing Date. Service with Seller or any prior employer recognized under the Sellers' Seller’s 401(k) Plan shall be recognized for eligibility, vesting adjusted to reflect any normal and all other purposes under Purchaser's Plan. As soon as practicable after Purchaser's Plan is determined reasonable administrative expenses properly attributable to be a tax qualified plan, Transferred the accounts of the Business Employees shall be permitted to make a rollover contribution from during the Sellers' 401(k) Plan to Purchaser's Plan. (f) Purchaser shall be liable for all obligations with respect to claims of Transferred Employees for (i) workers compensation for incidents occurring on or after period between the Closing Date and (ii) for claims the date of such Transferred Employees transfer. At the time the assets that arise from or relate to facts, circumstances or conduct that occurred or are deemed to occur on or after held in the Closing Date. With trust with respect to Transferred Employees, (iBusiness Employees under Seller’s 401(k) a claim for health benefits (including, without limitation, claims for medical, prescription drug and dental expenses) will be deemed to have been incurred on the date on which the related medical service or material was rendered to or received by the Transferred Employee claiming such benefit, (ii) a claim for sickness or disability benefits based on an injury or illness occurring prior Plan are paid to the Closing Date will trust under Purchaser’s 401(k) Plan, Purchaser’s 401(k) Plan shall assume all liabilities of Seller’s 401(k) Plan for the applicable benefits so transferred, and such transfer shall be deemed to have been incurred prior in full discharge of all obligations of Seller’s 401(k) Plan in respect thereof. Notwithstanding the above, the amount transferred to the Closing Date, and (iiitrust under Purchaser’s 401(k) Plan shall in no event be less than the case amount necessary to satisfy the requirements of any claim for benefits other than health benefits and sickness and disability benefits (e.g., life insurance benefits), a claim will be deemed to have been incurred upon the occurrence Section 414(l) of the event giving rise to such claimsCode. (g) Prior Nothing contained in this Agreement shall confer upon any Transferred Employee any rights with respect to Closingcontinuance of employment by Purchaser, and nor shall any provision of this Agreement create any third party beneficiary rights in any event within 90 days of the date of this AgreementTransferred Employee, Purchaser shallany beneficiary or dependents thereof, after consultation with the Sellers, establish a Retention Plan (the "Retention Plan") in an amount equal to $2,000,000 in the aggregate for payment to the Transferred Employees (i) who are employed by Purchaser or its Affiliates on the first anniversary of the Closing Date or (ii) whose employment with Purchaser or its Affiliates has been terminated by Purchaser or its Affiliates other than for Cause prior to the first anniversary of the Closing Date. The aggregate of $2,000,000 of payments shall be allocated among the Transferred Employees in the manner set forth in the Retention Plan, except that in the event one or more Transferred Employees terminates their employment prior to the first anniversary of the Closing Date or the employment of one or more Transferred Employees is terminated by Purchaser or its Affiliates for Cause prior to such first anniversary, the $2,000,000 initially allocated under the Retention Plan shall be reduced by the amounts allocated to such Transferred Employees. As promptly as practicable after establishing the Retention Plan, and in any event within 90 days of the date of this Agreement, Purchaser shall deliver to Parent a copy of the Retention Plan and the Sellers shall be entitled to disclose to the Transferred Employees the terms of the Retention Plan. For purposes of the Retention Plan, "Cause" shall mean the termination of the employee's employment by reason of any one or more of the following: (i) failure, in the reasonable judgment of Purchaser, of the employee to satisfactorily perform the employee's duties; (ii) fraud or dishonesty in the performance of the employee's duties; or (iii) a breach of any of the policies of "General Conduct" contained in the Employee Handbook of Star Tobacco & Pharmaceuticals, Inc. to the extent such breach would be grounds for a termination for cause under such Employee Handbook. A failure of an employee to relocate the place of his employment beyond 20 miles from the current location of such employment at the request of Purchaser will not constitute "Cause" for termination of employmentcollective bargaining representative thereof.

Certain Employee Benefits Matters. (a) All Parent or Purchasers, if any, shall offer employment, effective as of the Business Employees Closing to all employees of the Sellers who are actively employed (including those persons who are on vacation, short-term disability or similar leave) on in the operation of the Business as of the Closing Date shall be offered employment (“Business Employees”), which, except as set forth on an "at will" basis with the Purchaser on such dateSchedule 5.8(a), and such individuals who accept such offer on such date shall be referred to as "Transferred Employees." Each such offer of employment shall be (i) at the same include a rate of base salary or hourly wage rate and position wages that is, with respect to each individual, comparable to or greater than that in effect with respect to such individual as of immediately prior to the Closing Date and (ii) at the same location or within 20 miles from the location Closing. Those Business Employees who accept such offers of such employment immediately prior to the Closing Date. Purchaser shall also offer employment on an "at will" basis to each Business Employee who is temporarily absent from active employment on the Closing Date upon shall be referred to herein as the “Continuing Employees.” Unless otherwise agreed between Parent and a Continuing Employee, offers of employment to Continuing Employees shall be on an at-will basis. (b) Effective as of the Closing, Continuing Employees shall be exclusively employees of Parent or its Affiliates. Except as otherwise specifically provided for in this Agreement, Parent or Purchasers, if any, shall be solely responsible for, and shall indemnify Sellers and their respective Affiliates, with respect to, all Liabilities of Sellers relating to any Business Employee that arise from or relate to events or circumstances occurring prior to, on or following the Closing, including, without limitation, the actual or constructive termination of any such temporary absence within six months Business Employee in connection with or as a result of the consummation of the transactions contemplated by this Agreement. (c) As of the Closing, all Business Employees shall cease to accrue benefits under the Company Benefit Plans, and Knight, Holdings and Sellers shall take all such action as may be necessary to effect such cessation. There shall be no transfer of assets or liabilities of the Company Benefit Plans to Parent or Purchasers, if any, or to any Benefit Plans of Parent or Purchasers, except as expressly provided herein. Knight and Holdings shall retain all responsibility for, and neither Parent nor Purchasers, if any, shall have any obligation or responsibility for any of such benefits under the Company Benefit Plans. (d) For the one-year period following the Closing DateClosing, provided that such individual is able to perform the essential functions of the position he Parent or she previously held with the Sellers prior to such absencePurchasers, and any such individual shall be treated as a "Transferred Employee" from and after his or her date of employment with Purchaser. For a period of 12 months following the Closing Dateif any, Purchaser shall provide to each Continuing Employee, employee benefits (excluding equity or equity-based benefits) that, with respect to the Business Employees thateach such Continuing Employee, as Parent may from time to time determine, are, in the aggregate, (i) are substantially equivalent to those provided by Purchaser to its other similarly situated employees as of the Closing Date and (ii) are no less favorable than those provided by (i) the employee benefits (excluding equity or equity-based benefits) generally in effect for similarly situated employees of Parent and its subsidiaries or (ii) the employee benefits (excluding equity or equity-based benefits) to which such Continuing Employee was entitled immediately prior to Closing. (e) Parent or Purchasers, if any, shall provide each Continuing Employee who incurs a termination of employment within a period of one (1) year immediately following the Closing Date with severance payments and benefits which are at least equal to the severance payments and benefits to which such Continuing Employee would have been entitled with respect to such termination under the severance policies of Knight as set forth on Schedule 5.8(e). Parent or Purchasers, if any, shall promptly reimburse Sellers and their Subsidiaries under the Benefit Plans Affiliates for, and shall indemnify Sellers and their Affiliates with respect to, any Liabilities of Sellers (other than benefits relating including without limitation severance payments and benefits) incurred by Sellers or their Affiliates with respect to stock options or other equity-based compensation) to such those Business Employees immediately prior to (who are not Continuing Employees) whose employment is terminated in connection with or as a result of the Closing Date. Purchaser shall cause Purchaser's employee benefit plans transactions contemplated by this Agreement. (f) Parent or Purchasers, if any, will give Continuing Employees full credit for purposes of eligibility, vesting, and arrangements determination of the level of benefits (including, but not limited to, all "employee benefit plans" within the meaning for purposes of Section 3(3) of ERISA vacation and all plans, programs, policies and employee fringe benefit programs, including vacation policiesseverance), to the extent Purchaser makes them available to Business Employees, to recognize, solely for the purposes of determining the vesting of benefits and participation eligibility (but not for purposes of benefit accrual)accruals, all under any Benefit Plans maintained by Parent or Purchasers for such Continuing Employees’ service by Transferred Employees with the SellersSellers to the same extent recognized by Knight, including Holdings, or the Sellers immediately prior to the Closing Date; provided, however, that such service with predecessor employers, shall not be recognized to the extent that such service was recognized recognition would result in a duplication of benefits with respect to the same period of service. Sellers agree to provide Parent, as soon as practicable, with all information reasonably requested by Parent to satisfy its obligations under this Section 5.8(f). Parent or Purchasers, if any, will give Continuing Employees full credit for vacation days, sick days, and personal days accrued but unpaid as of the Closing. (g) Parent and Purchasers, if any, will (i) waive any preexisting condition limitations otherwise applicable to the Continuing Employees and their eligible dependents under any plan that provides health benefits in which Continuing Employees may be eligible to participate following the Closing to the extent such conditions are covered under the analogous benefit plans of Purchaser, provided that Company Benefit Plan in which such recognition does not result in any duplication of benefits. Individuals who have terminated employment with Sellers Continuing Employees participated immediately prior to the Closing Date and are subsequently hired by Purchaser and its Affiliates will not be entitled to any service recognition under this paragraph. Transferred Employees shall also be given credit for Closing, (ii) honor any deductible, co-payment amounts or and out-of-pocket expenses paid maximums incurred by the Continuing Employees and their eligible dependents under the health plans in respect which they participated immediately prior to Closing during the portion of the plan calendar year in which prior to the Closing occurs, to the extent that, following the Closing, they participate in and (iii) waive any corresponding plan maintained or sponsored by Purchaser for which deductibles or co-payments are required. (b) Purchaser agrees that any pre-existing condition exclusions or waiting periods period limitation or evidence of insurability requirements imposed under Purchaser's welfare benefit plans will requirement that would otherwise be waived with respect applicable to any Transferred a Continuing Employee and his or her covered eligible dependents on or after the Closing, in each case to the same extent that such exclusions, waiting periods Continuing Employee or evidence of insurability did not preclude his eligible dependent had satisfied any similar limitation or her participation in requirement under an analogous Company Benefit Plan prior to the equivalent plan of the SellersClosing. (ch) Sellers and their ERISA Affiliates shall be exclusively responsible for complying with COBRA with Parent or Purchasers, if any, will honor the terms of each employee compensation arrangement set forth on Schedule 5.8(h). (i) With respect to their employees with respect to any "qualifying event" as such term is defined in COBRAHolding’s 401(k) Profit Sharing Plan (the “Holdings 401(k) Plan”), occurring on or prior to Closing, Knight, Holdings, or Sellers shall cause all Continuing Employees who are participants in the Seller 401(k) Plan to be fully vested in their respective accounts thereunder. As soon as practicable following the Closing Date. (d, each Continuing Employee who is a participant in the Holding’s 401(k) Seller agrees Plan shall have the right to cause elect to receive a distribution of all or a portion of such employee’s account balance in the accrued benefits and account balances of Transferred Employees under the Star Tobacco Holding’s 401(k) Plan ("Sellers' subject to, and in accordance with, the provisions of the Holding’s 401(k) Plan") to be 100% vested effective as of the Closing Date. (e) Effective as of the Closing DatePlan and applicable Law). Parent or Purchasers, Purchaser if any, shall establish for the benefit of the Transferred Employees who, immediately prior to the Closing Date were participants in the Sellers' 401(k) Plan, designate a tax-qualified defined contribution plan of the Parent or shall designate a pre-existing tax-qualified Purchasers or one of their respective subsidiaries that provides for the receipt of “eligible rollover distributions” (as such term is defined contribution under Section 402 of the Code) (such plan, (in either case, "the “Purchaser's Plan"), which shall qualify as a cash or deferred plan under Section ’s 401(k) Plan”) and the Parent or Purchasers shall take all necessary action, if requested to do so by a Continuing Employee, to cause the trustee of the Code and shall provide benefits only with respect to service after the Closing Date. Service with Seller or any prior employer recognized under the Sellers' 401(k) Plan shall be recognized for eligibility, vesting and all other purposes under Purchaser's Plan. As soon as practicable after Purchaser's Plan is determined to be a tax qualified plan, Transferred Employees shall be permitted to make a rollover contribution from the Sellers' ’s 401(k) Plan to accept the direct “roll over” of all or a portion of any distribution (excluding outstanding loan balances) from the Holding’s 401(k) Plan (subject to, and in accordance with, the provisions of the Purchaser's ’s 401(k) Plan and applicable Law). Parent or Purchasers, if any, will use commercially reasonable best efforts to assist each Continuing Employee who, as of the Closing, has an outstanding loan balance with respect to such employee’s account balance in Holding’s 401(k) Plan. (f) Purchaser shall be liable for all , to satisfy such employee’s repayment obligations with respect to claims such loan, either by loan, advance or otherwise as determined by Parent or Purchasers, if any, in their sole discretion. (j) Sellers shall be, or shall cause the applicable welfare benefit plans of Transferred Employees Knight to be, responsible for (i) workers compensation for incidents occurring on or after the Closing Date and (ii) for claims of such Transferred Employees that arise from or relate to facts, circumstances or conduct that occurred or are deemed to occur on or after the Closing Date. With respect to Transferred Employees, (i) a claim for health providing welfare benefits (including, without limitation, claims for including medical, prescription drug hospital, dental, accidental death and dental expensesdismemberment, life, disability and other similar benefits) will be deemed to have been incurred on current and former employees of the date on which the related medical service or material was rendered to or received by the Transferred Employee claiming such benefit, (ii) a claim Sellers for sickness or disability benefits based on an injury or illness occurring prior to the Closing Date will be deemed to have been all claims incurred prior to the Closing Dateunder and subject to the generally applicable terms and conditions of the employee benefit plans, programs and (iii) arrangements in which such employees were entitled to participate immediately prior to the case Closing. For purposes of any claim for benefits other than health benefits and sickness and disability benefits (e.g., life insurance benefitsthis Section 5.8(j), a claim will be deemed is incurred with respect to have been incurred upon the occurrence of accidental death and dismemberment, disability, life and other similar benefits when the event giving rise to such claimsclaim occurred. A claim is incurred with respect to medical, dental, and other similar benefits when the services with respect to such claim are rendered. Any claim above that relates to a continuous period of hospitalization shall be deemed to be incurred at the commencement of such period of hospitalization. (gk) Prior Notwithstanding anything in this Agreement to Closingthe contrary, nothing contained in this Section 5.8, express or implied, shall be interpreted to confer upon any Person (including any employee of Sellers) any rights or remedies as a third-party beneficiary, including any rights of continued employment, any rights to a particular term of employment or any rights to any particular compensation or benefits whatsoever (including any form of notice or severance pay). The right to enforce any terms of this Section 5.8 shall inure only to the Parties and shall in no way extend to any third parties who might benefit from the terms of this Agreement in any event within 90 days way, including any employee of the date Sellers. (l) The Parties intend to utilize Standard Procedure described in Section 4 of this AgreementIRS Revenue Procedure 96-60, Purchaser shall, after consultation 1996-2 Cum. Bull. 399 with the Sellers, establish a Retention Plan (the "Retention Plan") in an amount equal respect to $2,000,000 in the aggregate for payment Continuing Employees. Sellers shall provide information and data to Parent upon request with respect to wages and payroll taxes with respect to the Transferred Continuing Employees (i) who are employed by Purchaser or its Affiliates on for the first anniversary of calendar year in which the Closing Date or occurs. (iim) whose employment Sellers shall give notice, in accordance with Purchaser or its Affiliates has been terminated by Purchaser or its Affiliates other than for Cause prior all applicable Laws, to the first anniversary those Business Employees (and their dependents) who lose coverage under a Seller group health plan as result of the Closing Date. The aggregate of $2,000,000 of payments shall be allocated among the Transferred Employees in the manner set forth in the Retention Plan, except that in the event one or more Transferred Employees terminates their employment prior to the first anniversary consummation of the Closing Date or the employment actions contemplated by this Agreement (“COBRA Eligible Individuals”) of one or more Transferred Employees is terminated by Purchaser or its Affiliates for Cause prior such individuals’ rights to such first anniversary, the $2,000,000 initially allocated continuation coverage under the Retention Plan shall be reduced by the amounts allocated to such Transferred Employees. As promptly as practicable after establishing the Retention Plan, and in any event within 90 days Section 4980B of the date of this Agreement, Purchaser shall deliver to Parent a copy of the Retention Plan and the Sellers shall be entitled to disclose to the Transferred Employees the terms of the Retention PlanCode (“COBRA”). For purposes of the Retention Plan, "Cause" shall mean the termination of the employee's employment by reason of any one or more of the following: (i) failure, in the reasonable judgment of Purchaser, of the employee to satisfactorily perform the employee's duties; (ii) fraud or dishonesty in the performance of the employee's duties; or (iii) a breach of any of the policies of "General Conduct" contained in the Employee Handbook of Star Tobacco & Pharmaceuticals, Inc. to To the extent such breach would be grounds required by Law, Sellers or their Affiliates, as applicable, shall provide continuation coverage under COBRA for a termination for cause under such Employee Handbook. A failure of an employee to relocate the place of his employment beyond 20 miles those COBRA Eligible Individuals who timely elect COBRA continuation coverage from the current location of such employment at the request of Purchaser will not constitute "Cause" for termination of employmentSellers.

Certain Employee Benefits Matters. (a) All of the Business Employees who are actively employed (including those on vacation) on the Closing Date shall be offered employment on an "at will" basis with the Purchaser on such date, and such individuals who accept such offer on such date shall be referred to as "Transferred Employees." Each such offer of employment shall be (i) at the same salary or hourly wage rate and position in effect immediately prior to the Closing Date and (ii) at the same location or within 20 miles from the location of such employment immediately prior to the Closing Date. Purchaser shall also offer employment on an "at will" basis to each Business Employee who is temporarily absent from active employment on the Closing Date upon termination of such temporary absence within six months following the Closing Date, provided that such individual is able to perform the essential functions of the position he or she previously held with the Sellers prior to such absence, and any such individual shall be treated as a "Transferred Employee" from From and after his or her date of employment with Purchaser. For a period of 12 months following the Closing Date, Purchaser shall provide benefits to the Business Employees that, in the aggregate, (i) are substantially equivalent to those provided by Purchaser to its other similarly situated employees as of the Closing Date and (ii) are no less favorable than those provided by the Sellers and their Subsidiaries under the Benefit Plans (other than benefits relating to stock options or other equity-based compensation) to such Business Employees immediately prior to the Closing Date. Purchaser shall cause Purchaser's employee benefit plans and arrangements (including, but not limited to, all "employee benefit plans" within the meaning of Section 3(3) of ERISA and all plans, programs, policies and employee fringe benefit programs, including vacation policies), to the extent Purchaser makes them available to Business Employees, to recognize, solely for the purposes of determining the vesting of benefits and participation eligibility (but not for benefit accrual), all service by Transferred Employees with the Sellers, including service with predecessor employers, to the extent that such service was recognized by the analogous benefit plans of Purchaser, provided that such recognition does not result in any duplication of benefits. Individuals who have terminated employment with Sellers prior to the Closing Date and are subsequently hired by Purchaser and its Affiliates will not be entitled to any service recognition under this paragraph. Transferred Employees shall also be given credit for any deductible, co-payment amounts or out-of-pocket expenses paid in respect of the plan year in which the Closing occurs, to the extent that, following the Closing, they participate in any corresponding plan maintained or sponsored by Purchaser for which deductibles or co-payments are required. (b) Purchaser agrees that any pre-existing condition exclusions or waiting periods or evidence Purchaser and the Fairway Group Companies shall be solely responsible for satisfying the requirements of insurability requirements imposed under Purchaser's welfare benefit plans will be waived with respect to any Transferred Employee and his or her covered dependents to the same extent that such exclusions, waiting periods or evidence of insurability did not preclude his or her participation in the equivalent plan Section 4980B of the Sellers. (c) Sellers and their ERISA Affiliates shall be exclusively responsible Code for complying with COBRA with respect to their employees with respect to any "qualifying event" all individuals who are “M&A qualified beneficiaries” as such term is defined in COBRATreasury Regulation Section 54.4980B-9, occurring on or prior to other than the Closing Date. Business Employees (das defined in the Restructuring Purchase Agreement with Fairway 2.0 as the purchaser) and any M&A qualified beneficiary whose coverage before the qualifying event was associated with a Business Employee. Seller agrees to cause that Seller shall be solely responsible for satisfying the accrued benefits and account balances requirements of Transferred Employees under the Star Tobacco 401(k) Plan ("Sellers' 401(k) Plan") to be 100% vested effective as Section 4980B of the Closing Date. (e) Effective as Code for all such Business Employees and associated M&A qualified beneficiaries. Seller shall obtain the consent of the Closing Date, Purchaser shall establish for the benefit relevant insurance providers so that employees (other than Business Employees) of the Transferred Employees who, Fairway Group Companies immediately prior to the Closing Date were participants in who remain employed immediately following the Sellers' 401(kClosing (the “Continuing Employees”) Planshall be provided group term life insurance coverage until December 31, a tax-qualified defined contribution plan or shall designate a pre-existing tax-qualified defined contribution plan, (in either case, "Purchaser's Plan"), which shall qualify as a cash or deferred plan 2018 under the applicable Benefit Plans listed on Section 401(k7.10(a) of the Code and shall provide benefits only with respect Company Disclosure Schedule, subject to service after Purchaser promptly paying or reimbursing to Fairway 2.0 the full premium cost of such coverage pro-rated for the period of time between the Closing Dateand December 31, 2018. Service with Seller or will obtain the consent of the relevant insurance providers (including any stop-loss insurance provider) so the Continuing Employees and their eligible beneficiaries who are as of immediately prior employer recognized to the Closing enrolled in such Benefit Plans (collectively, the “Continuing Participants”) shall be provided medical, dental and vision insurance and health flexible spending account plan coverage until December 31, 2018 under the Sellers' 401(kapplicable Benefit Plans listed on Section 7.10(b) Plan shall be recognized for eligibilityof the Company Disclosure Schedule, vesting and all other purposes under Purchaser's Plan. As soon as practicable after Purchaser's Plan is determined subject to be a tax qualified plan, Transferred Employees shall be permitted Purchaser promptly paying or reimbursing to make a rollover contribution from the Sellers' 401(k) Plan to Purchaser's Plan. (f) Purchaser shall be liable for all obligations with respect to claims of Transferred Employees for Fairway 2.0 (i) workers compensation the full premium cost of the dental and vision insurance coverage pro-rated for incidents occurring on or after the period of time between the Closing Date and (ii) for claims of such Transferred Employees that arise from or relate to factsDecember 31, circumstances or conduct that occurred or are deemed to occur on or after the Closing Date. With respect to Transferred Employees, (i) a claim for health benefits (including, without limitation, claims for medical, prescription drug and dental expenses) will be deemed to have been incurred on the date on which the related medical service or material was rendered to or received by the Transferred Employee claiming such benefit2018, (ii) a claim the amount of the actual medical claims costs incurred by the Continuing Participants for sickness or disability benefits based on an injury or illness occurring prior claims incurred during the period of time between the Closing and December 31, 2018, (iii) the amount of the payroll deductions associated with funding the health flexible spending account December 2018 contribution but only to the Closing Date will be deemed to have been incurred prior to extent (A) such amounts were deducted from Continuing Participants’ pay during the period of time between the Closing Dateand December 31, 2018 and (B) Purchaser received such payroll deductions, and (iiiiv) an administrative charge in the case amount set forth on Section 7.10(c) of the Company Disclosure Schedule, which shall include only the actual charges by third party vendors and reinsurers pro-rated for the period of time between the Closing and December 31, 2018. Purchaser shall reimburse Fairway 2.0 for the amounts under this Section 7.10 within thirty (30) days of receipt of any claim for benefits other than health benefits and sickness and disability benefits (e.g., life insurance benefits), a claim will be deemed to have been incurred upon the occurrence of the event giving rise to such claims. (g) Prior to Closing, and in any event within 90 days of the date of this Agreement, Purchaser shall, after consultation with the Sellers, establish a Retention Plan (the "Retention Plan") in an amount equal to $2,000,000 in the aggregate for payment to the Transferred Employees (i) who are employed by Purchaser or its Affiliates on the first anniversary of the Closing Date or (ii) whose employment with Purchaser or its Affiliates has been terminated by Purchaser or its Affiliates other than for Cause prior to the first anniversary of the Closing Date. The aggregate of $2,000,000 of payments shall be allocated among the Transferred Employees in the manner set invoice that sets forth in reasonable detail the Retention Plan, except that in basis for computing the event one or more Transferred Employees terminates their employment prior to the first anniversary of the Closing Date or the employment of one or more Transferred Employees is terminated by Purchaser or its Affiliates for Cause prior to such first anniversary, the $2,000,000 initially allocated under the Retention Plan shall be reduced by the amounts allocated to such Transferred Employees. As promptly as practicable after establishing the Retention Plan, and in any event within 90 days of the date of this Agreement, Purchaser shall deliver to Parent a copy of the Retention Plan charges and the Sellers shall be entitled to disclose to corresponding amounts owed. Upon the Transferred Employees the terms of the Retention Plan. For purposes of the Retention Plan, "Cause" shall mean the termination of the employee's employment by reason of any one or more of the following: (i) failure, in the reasonable judgment request of Purchaser, the Seller Representative shall cause Fairway 2.0 to provide any records reasonably available to substantiate such charges. Purchaser and the Fairway Group Companies shall be solely responsible for complying with the requirements of Section 4980B of the employee Code for all Continuing Participants who experience a qualifying event (as determined under Section 4980B of the Code) at any time. Fairway 2.0 shall be a third-party beneficiary of the provisions of this Section 7.10. Upon written request by Purchaser, the Representative shall deliver or cause to satisfactorily perform be delivered to Purchaser all reasonably available documents, certificates, agreements, and amendments, duly executed that change the employee's duties; (ii) fraud or dishonesty plan sponsor under each Benefit Plan to Fairway 2.0 and allow Fairway Outdoor Advertising, LLC employees to participate in the performance of the employee's duties; or (iii) a breach of any of the policies of "General Conduct" contained in the Employee Handbook of Star Tobacco & PharmaceuticalsBenefit Plans between Closing and December 31, Inc. to the extent such breach would be grounds for a termination for cause under such Employee Handbook. A failure of an employee to relocate the place of his employment beyond 20 miles from the current location of such employment at the request of Purchaser will not constitute "Cause" for termination of employment2018.

Certain Employee Benefits Matters. (a) All Effective as of the Business Employees day immediately following the Closing Date, Buyer shall cause to be established an appropriate defined contribution plan with a cash or deferred arrangement (the "Buyer's 401(k) Plan"). As soon as reasonably practicable, but in any event (unless both Buyer and Seller otherwise agree in writing) within ninety (90) days after the Closing Date, Seller shall cause to be transferred from the Aztec Technology Partners, Inc. 401(k) Plan ("Seller's 401(k) Plan") to the Buyer's 401(k) Plan the liability for the account balances of the employees who are actively employed (including those on vacation) by any Group Member on the Closing Date and participated in the Seller's 401(k) Plan, including any outstanding participant loans, together with assets transferred in-kind, to the extent possible, or otherwise in cash, the fair market value for which is equal to such liability. (b) Effective as of the day immediately following the Closing Date, Buyer shall cause to be offered employment established an appropriate cafeteria plan (the "Buyer's Flexible Spending Plan"). As soon as reasonably practicable, but in any event (unless both Buyer and Seller otherwise agree in writing) within forty-five (45) days after the Closing Date, Seller shall cause to be transferred from the Aztec Technology Partners, Inc. Flexible Spending Plan ("Seller's Flexible Spending Plan") to the Buyer's Flexible Spending Plan, the liability for the account balances of the employees who are employed by any Group Member on an "at will" basis the Closing Date and are participants in Seller's Flexible Spending Plan, together with cash equal to such liability. The Buyer will treat as remaining in effect any elections the employees of a Group Member in effect under Seller's Flexible Spending Plan on the Closing Date to the extent such elections are consistent with the Purchaser on such dateterms of the Buyer's Flexible Spending Plan. (c) Seller and each Group Member, jointly and such individuals who accept such offer on such date shall be referred severally, covenants and agrees that it will not do or agree to as "Transferred Employees." Each such offer do any of employment shall be the following without the prior written consent of Buyer: (i) at grant any increase in compensation or benefits to any employees or officers of any Group Member, except as set forth on a Schedule to this Agreement; enter into or amend the same terms of any severance or termination agreements, plans, programs, policies or procedures, with or for employees or former employees of any Group Member; or effect any change in any benefits, plans, programs, policies, or procedures for any employees, former employees or officers of any Group Member (unless such change is required by applicable law or as a condition to obtaining a favorable determination letter from the Internal Revenue Service with respect to an Employee Benefit Plan) that would increase the liabilities of a Group Member; PROVIDED, HOWEVER, that nothing in this subsection (i) shall prevent the payment or other performance of any award or grant made prior to the date of this Agreement and disclosed on Section 9.5 of the Disclosure Schedule; and PROVIDED FURTHER, that Seller shall consult with Buyer regarding matters relating to such changes in applicable law or maintaining the tax qualified status of any such Employment Benefit Plan; (ii) except with respect to temporary employees in the ordinary course and automatic changes in wages and terms of employment consistent with current contracts, enter into or modify any employment, severance, termination or similar agreements or arrangements with, or grant any bonuses, salary increases, severance or hourly wage rate termination pay to, any officer, director, consultant or employee or shareholder of any Group Member; (iii) adopt any new employee benefit plan or make any change in or to any existing Employee Benefit Plan other than any such change that (A) is required by law, or (B) in the judgment of Seller is necessary or advisable to maintain the tax qualified status of any such Employee Benefit Plan; provided that Seller shall consult with Buyer regarding matters relating to maintaining the tax qualified status of such Employee Benefit Plan. (d) Except as otherwise provided in Section 9.5(g), each Group Member's participation in any Employee Benefit Plan sponsored or maintained by the Seller shall be terminated effective as of the Closing Date in accordance with all applicable law. Prior to the Closing Date, each Group Member shall provide to Buyer written evidence of the required actions by each Group Member effecting the action described in the first sentence of this Section, all in form and position substance satisfactory to Buyer. (e) Neither Buyer nor any Group Member shall be liable for any claims made or incurred by employees or former employees of any Group Member under the Employee Benefit Plans maintained by the Seller after the Closing Date. For purposes of the immediately preceding sentence, a charge will be deemed incurred, in effect immediately the case of hospital, medical, dental, vision, prescription drug or health benefits, when the services that are the subject of the charge are performed and, in the case of other benefits (such as disability or life insurance), when an event has occurred or when a condition has been diagnosed which entitles the employee to the benefit. (f) Seller shall be responsible for providing employees of any Group Member who terminated employment on or prior to the Closing Date or became temporarily or permanently disabled on or prior to the Closing Date and their "qualified beneficiaries" (iiwithin the meaning of Code Section 4980B) at with the same location continuation of group health coverage required by Code Section 4980B and Sections 601 through 608 or within 20 miles from ERISA ("COBRA Coverage"). The Seller shall be responsible for providing the location employees of such employment immediately prior to the Closing Date. Purchaser shall also offer employment on an "at will" basis to each Business Employee any Group Member who is are temporarily absent from active employment or permanently disabled on the Closing Date upon termination of such temporary absence within six months following the Closing Datewith medical, provided that such individual is able to perform the essential functions of the position he or she previously held with the Sellers prior to such absence, dental and any such individual shall be treated as a "Transferred Employee" from employee and after his or her date of employment with Purchaser. For a period of 12 months following the Closing Date, Purchaser shall provide benefits to the Business Employees that, in the aggregate, (i) are substantially equivalent to those provided by Purchaser to its other similarly situated employees as of the Closing Date dependents' life insurance coverage and (ii) are no less favorable than those provided by the Sellers and their Subsidiaries COBRA coverage under the Benefit Plans (other than benefits relating to stock options or other equity-based compensation) to such Business Employees immediately prior to the Closing Date. Purchaser shall cause PurchaserSeller's employee welfare benefit plans and arrangements the Buyer shall have no responsibility for providing such coverages under Buyer's Welfare Plans (including, but not limited to, all "employee benefit plans" within the meaning of as defined in Section 3(3) of ERISA and all plans, programs, policies and employee fringe benefit programs, including vacation policies9.5(g)), unless and until such individuals return to the extent Purchaser makes them available to Business Employees, to recognize, solely for the purposes of determining the vesting of benefits and participation eligibility (but not for benefit accrual), all service by Transferred Employees active employment with the Sellers, including service with predecessor employers, to the extent that such service was recognized by the analogous benefit plans of Purchaser, provided that such recognition does not result in any duplication of benefits. Individuals who have terminated employment with Sellers prior to the Closing Date and are subsequently hired by Purchaser and its Affiliates will not be entitled to any service recognition under this paragraph. Transferred Employees shall also be given credit for any deductible, co-payment amounts or out-of-pocket expenses paid in respect of the plan year in which the Closing occurs, to the extent that, following the Closing, they participate in any corresponding plan maintained or sponsored by Purchaser for which deductibles or co-payments are requiredBuyer. (bg) Purchaser agrees that any pre-existing condition exclusions or waiting periods or evidence of insurability requirements imposed under Purchaser's Buyer will use its commercially reasonable efforts to cause employee welfare benefit plans (as defined in Section 3(1) of ERISA) providing medical, dental, disability and life insurance coverage ("Buyer's Welfare Plans") which shall be substantially similar to Seller's employee welfare benefit plans that cover employees of the Group Members to be established on a timely basis so that such plans will be waived with respect to any Transferred Employee and his or her covered dependents to the same extent that such exclusions, waiting periods or evidence of insurability did not preclude his or her participation in the equivalent plan of the Sellers. (c) Sellers and their ERISA Affiliates shall be exclusively responsible for complying with COBRA with respect to their employees with respect to any "qualifying event" as such term is defined in COBRA, occurring on or prior to the Closing Date. (d) Seller agrees to cause the accrued benefits and account balances of Transferred Employees under the Star Tobacco 401(k) Plan ("Sellers' 401(k) Plan") to be 100% vested effective effect as of the Closing Date. If Buyer is unable to arrange for the necessary insurance or other coverage required by Buyer's Welfare Plans, Seller will permit employees of the Group Members to receive the coverages in effect immediately before the Closing Date under the medical and dental plans maintained by Aztec Technology Partners, Inc. (the "Welfare Benefit Plans") under an arrangement that will be administered by Seller pursuant to the appropriate Seller employee welfare benefit plans for the period (the "Transition Services Period") following the Closing Date and ending on the last day of the sixth (6th) full calendar month from the Closing Date, unless extended by mutual agreement of Seller and Buyer or earlier terminated in accordance with the Welfare Benefit Plan Transition Services Agreement, attached hereto as Attachment 9.5, subject to Buyer paying Seller a monthly fee for such coverages as described in the Welfare Benefit Transition Services Agreement. (eh) Effective In the event the Buyer is unable to arrange for Buyer's Welfare Benefit Plan coverage as of the Closing Date, Purchaser shall establish the Seller will also provide to the Buyer during the Transition Period all administrative and other services related to the Welfare Benefit Plans that were performed for the benefit of the Transferred Employees who, Group immediately prior to before the Closing Date were participants by the Seller including but not limited to the following services: (i) employee benefits (including COBRA) administration; (ii) management information systems and central data processing support; and (iii) accounting services. The Seller shall be responsible for providing the Buyer with a utilization report for each of the Group Members during the Transition Period for the medical and dental coverages. Such utilization reports shall include for each coverage, paid claim data for the month, employee and dependent enrollment counts and claim data detail for any claimants with claims in excess of $10,000 or significant medical conditions. (i) The Seller shall transfer to the Sellers' Buyer any information regarding the Employee Benefit Plans as may be necessary for the Buyer to establish and administer Buyer's 401(k) Plan, a tax-qualified defined contribution plan or shall designate a pre-existing tax-qualified defined contribution planBuyer's Flexible Spending Plan and Buyer's Welfare Plans, (in either case, "Purchaser's Plan"), which shall qualify as a cash or deferred plan under Section 401(k) of the Code and shall provide benefits only otherwise cooperate with respect to service after Buyer regarding the Closing Date. Service with Seller or any prior employer recognized under the Sellers' spin-off of Seller's 401(k) Plan shall be recognized for eligibility, vesting and all other purposes under PurchaserSeller's Plan. As soon as practicable after Purchaser's Plan is determined to be a tax qualified plan, Transferred Employees shall be permitted to make a rollover contribution from the Sellers' 401(k) Plan to Purchaser's Flexible Spending Plan. (f) Purchaser shall be liable for all obligations with respect to claims of Transferred Employees for (i) workers compensation for incidents occurring on or after the Closing Date and (ii) for claims of such Transferred Employees that arise from or relate to facts, circumstances or conduct that occurred or are deemed to occur on or after the Closing Date. With respect to Transferred Employees, (i) a claim for health benefits (including, without limitation, claims for medical, prescription drug and dental expenses) will be deemed to have been incurred on the date on which the related medical service or material was rendered to or received by the Transferred Employee claiming such benefit, (ii) a claim for sickness or disability benefits based on an injury or illness occurring prior to the Closing Date will be deemed to have been incurred prior to the Closing Date, and (iii) in the case of any claim for benefits other than health benefits and sickness and disability benefits (e.g., life insurance benefits), a claim will be deemed to have been incurred upon the occurrence of the event giving rise to such claims. (g) Prior to Closing, and in any event within 90 days of the date of this Agreement, Purchaser shall, after consultation with the Sellers, establish a Retention Plan (the "Retention Plan") in an amount equal to $2,000,000 in the aggregate for payment to the Transferred Employees (i) who are employed by Purchaser or its Affiliates on the first anniversary of the Closing Date or (ii) whose employment with Purchaser or its Affiliates has been terminated by Purchaser or its Affiliates other than for Cause prior to the first anniversary of the Closing Date. The aggregate of $2,000,000 of payments shall be allocated among the Transferred Employees in the manner set forth in the Retention Plan, except that in the event one or more Transferred Employees terminates their employment prior to the first anniversary of the Closing Date or the employment of one or more Transferred Employees is terminated by Purchaser or its Affiliates for Cause prior to such first anniversary, the $2,000,000 initially allocated under the Retention Plan shall be reduced by the amounts allocated to such Transferred Employees. As promptly as practicable after establishing the Retention Plan, and in any event within 90 days of the date of this Agreement, Purchaser shall deliver to Parent a copy of the Retention Plan and the Sellers shall be entitled to disclose to the Transferred Employees the terms of the Retention Plan. For purposes of the Retention Plan, "Cause" shall mean the termination of the employee's employment by reason of any one or more of the following: (i) failure, in the reasonable judgment of Purchaser, of the employee to satisfactorily perform the employee's duties; (ii) fraud or dishonesty in the performance of the employee's duties; or (iii) a breach of any of the policies of "General Conduct" contained in the Employee Handbook of Star Tobacco & Pharmaceuticals, Inc. to the extent such breach would be grounds for a termination for cause under such Employee Handbook. A failure of an employee to relocate the place of his employment beyond 20 miles from the current location of such employment at the request of Purchaser will not constitute "Cause" for termination of employment.

Certain Employee Benefits Matters. (a) All of the Business Employees who are actively employed (including those on vacation) on the Closing Date shall be offered employment on an "at will" basis with the Purchaser on such date, and such individuals who accept such offer on such date shall be referred to as "Transferred Employees." Each such offer of employment shall be (i) at the same salary or hourly wage rate and position in effect immediately prior to the Closing Date and (ii) at the same location or within 20 miles from the location of such employment immediately prior to the Closing Date. Purchaser shall also offer employment on an "at will" basis to each Business Employee who is temporarily absent from active employment on the Closing Date upon termination of such temporary absence within six months following the Closing Date, provided that such individual is able to perform the essential functions of the position he or she previously held with the Sellers prior to such absence, and any such individual shall be treated as a "Transferred Employee" from and after his or her date of employment with Purchaser. For a period of 12 months following the Closing Date, Purchaser shall provide benefits to the Business Employees that, in the aggregate, (i) are substantially equivalent to those provided by Purchaser to its other similarly situated employees as of the Closing Date and (ii) are no less favorable than those provided by the Sellers and their Subsidiaries under the Benefit Plans (other than benefits relating to stock options or other equity-based compensation) to such Business Employees immediately prior to the Closing Date. Purchaser shall cause Purchaser's employee benefit plans and arrangements (including, but not limited to, all "employee benefit plans" within the meaning of Section 3(3) of ERISA and all plans, programs, policies and employee fringe benefit programs, including vacation policies), to the extent Purchaser makes them available to Business Employees, to recognize, solely for the purposes of determining the vesting of benefits and participation eligibility (but not for benefit accrual), all service by Transferred Employees with the Sellers, including service with predecessor employers, to the extent that such service was recognized by the analogous benefit plans of Purchaser, provided that such recognition does not result in any duplication of benefits. Individuals who have terminated employment with Sellers prior to the Closing Date and are subsequently hired by Purchaser and its Affiliates will not be entitled to any service recognition under this paragraph. Transferred Employees shall also be given credit for any deductible, co-payment amounts or out-of-pocket expenses paid in respect of the plan year in which the Closing occurs, to the extent that, following the Closing, they participate in any corresponding plan maintained or sponsored by Purchaser for which deductibles or co-payments are required. (b) Purchaser agrees that any pre-existing condition exclusions or waiting periods or evidence of insurability requirements imposed under Purchaser's welfare benefit plans will be waived with respect to any Transferred Employee and his or her covered dependents to the same extent that such exclusions, waiting periods or evidence of insurability did not preclude his or her participation in the equivalent plan of the Sellers. (c) Sellers and their ERISA Affiliates shall be exclusively responsible for complying with COBRA with respect to their employees with respect to any "qualifying event" as such term is defined in COBRA, occurring on or prior to the Closing Date. (d) Seller agrees to cause the accrued benefits and account balances of Transferred Employees under the Star Tobacco 401(k) Plan ("Sellers' 401(k) Plan") to be 100% vested effective as of the Closing Date. (e) Effective as of the Closing Date, Purchaser shall establish for the benefit of the Transferred Employees who, immediately prior to the Closing Date were participants in the Sellers' 401(k) Plan, a tax-qualified defined contribution plan or shall designate a pre-existing tax-qualified defined contribution plan, (in either case, "Purchaser's Plan"), which shall qualify as a cash or deferred plan under Section 401(k) employment of each of the Code employees of the Business (including two employees ("Rimtech Employees") currently employed by Rimtech Marketing Incorporated) ("Transferring Employees") shall cease and the Transferring Employees shall provide benefits only with respect to service after immediately become employees of Purchaser at the base compensation and wage levels in effect as of the Closing Date. Service with Seller or any prior employer recognized under the Sellers' 401(k) Plan shall be recognized for eligibility, vesting and all other purposes under Purchaser's Plan. As soon as practicable after Purchaser's Plan is determined to be a tax qualified plan, Transferred Transferring Employees shall be permitted employees at will and nothing in this Agreement shall create any obligation on the part of Purchaser to make a rollover contribution from continue the Sellers' 401(k) Plan to Purchaser's Plan. (f) Purchaser shall be liable employment of any Transferring Employee for all obligations with respect to claims any period of Transferred Employees time. However for (i) workers compensation for incidents occurring the period beginning on or after the Closing Date and (ii) for claims of such Transferred Employees that arise from or relate to facts, circumstances or conduct that occurred or are deemed to occur on or after the Closing Date. With respect to Transferred Employees, (i) a claim for health benefits (including, without limitation, claims for medical, prescription drug and dental expenses) will be deemed to have been incurred on the date on which the related medical service or material was rendered to or received by the Transferred Employee claiming such benefit, (ii) a claim for sickness or disability benefits based on an injury or illness occurring prior to the Closing Date will be deemed to have been incurred prior to the Closing Date, and (iii) in the case of any claim for benefits other than health benefits and sickness and disability benefits (e.g., life insurance benefits), a claim will be deemed to have been incurred upon the occurrence of the event giving rise to such claims. (g) Prior to Closing, and in any event within 90 days of the date of this Agreement, Purchaser shall, after consultation with the Sellers, establish a Retention Plan (the "Retention Plan") in an amount equal to $2,000,000 in the aggregate for payment to the Transferred Employees (i) who are employed by Purchaser or its Affiliates ending on the first anniversary of the Closing Date or Date, Purchaser shall provide employee benefit welfare and retirement plans and programs to the Transferring Employees (while continuing in the employ of Purchaser) that are substantially similar in the aggregate to the employee benefit plans and programs listed on Schedule 3.1 (1) The employment by Purchaser of each Union Employee shall be done in accordance with the terms of each applicable collective bargaining agreement pertaining to such Union Employee. With regard to Union Employees, Purchaser shall (i) recognize each labor union representing Union Employees as their exclusive bargaining representative, (ii) whose employment assume, and become party to and bound by the terms and conditions of, each applicable collective bargaining agreement until the respective expiration date of the current term of each applicable collective bargaining agreement without respect to any renewals, extensions or modifications therein or thereto, (iii) comply with Purchaser or its legal obligations under Federal labor law with regard to Union Employees, and (iv) treat service with the Sellers and their Affiliates has been terminated by Purchaser or its Affiliates other than for Cause prior to the first anniversary of the Closing Date. The aggregate of $2,000,000 of payments shall be allocated among the Transferred Employees Date in the same manner set forth as such service has been recognized by the Sellers for purposes of determining seniority rights and benefits under the applicable collective bargaining agreement (except where recognition of such service by Purchaser would result in a duplication of benefits provided). Except as otherwise required by the Retention Planterms of any such plan or applicable law, except that in the event one or more Transferred Employees terminates their employment prior to the first anniversary as of the Closing Date or the employment of one or more Transferred all Transferring Employees is terminated by Purchaser or its Affiliates for Cause prior to such first anniversary, the $2,000,000 initially allocated under the Retention Plan shall be reduced by the amounts allocated to such Transferred Employees. As promptly as practicable after establishing the Retention Plancease in participation in, and in shall cease accruing any event within 90 days of the date of this Agreementbenefits under, Purchaser shall deliver to Parent a copy of the Retention any Pension Plan and the Sellers shall be entitled to disclose to the Transferred Employees the terms of the Retention Welfare Plan. For purposes of the Retention Plan, "Cause" shall mean the termination of the employee's employment by reason of any one or more of the following: (i) failure, in the reasonable judgment of Purchaser, of the employee to satisfactorily perform the employee's duties; (ii) fraud or dishonesty in the performance of the employee's duties; or (iii) a breach of any of the policies of "General Conduct" contained in the Employee Handbook of Star Tobacco & Pharmaceuticals, Inc. to the extent such breach would be grounds for a termination for cause under such Employee Handbook. A failure of an employee to relocate the place of his employment beyond 20 miles from the current location of such employment at the request of Purchaser will not constitute "Cause" for termination of employment.

Certain Employee Benefits Matters. (a) All Purchaser shall or shall cause the Company and its Subsidiaries to employ, effective as of the Business Employees Closing Date, each of the employees of the Company and its Subsidiaries who are actively employed (including those on vacation) on the Closing Date shall be offered employment on an "at will" basis with the Purchaser on such dateare, and such individuals who accept such offer on such date shall be referred to as "Transferred Employees." Each such offer of employment shall be (i) at the same salary or hourly wage rate and position in effect immediately prior to the Closing Date and (ii) at the same location Closing, actively employed or within 20 miles from the location on vacation, leave of such employment immediately prior to the Closing Date. Purchaser shall also offer employment on an "at will" basis to each Business Employee who is temporarily absent from active employment on the Closing Date upon termination of such temporary absence within six months following the Closing Date, provided that such individual is able to perform the essential functions of the position he or she previously held with the Sellers prior to such absence, and any such individual shall be treated as a disability or sick leave or lay-off (the "Transferred Employee" from and after his or her date of employment with PurchaserEmployees"). For a period purposes of 12 months following the Closing Datevacation entitlement only, Purchaser shall provide benefits to the Business Employees that, in the aggregate, (i) are substantially equivalent to those provided by Purchaser to its other similarly situated employees as of the Closing Date and (ii) are no less favorable than those provided by the Sellers and their Subsidiaries under the Benefit Plans (other than benefits relating to stock options or other equity-based compensation) to such Business Employees immediately prior to the Closing Date. Purchaser shall cause Purchaser's employee benefit plans and arrangements (including, but not limited to, to recognize all "employee benefit plans" within the meaning of Section 3(3) of ERISA and all plans, programs, policies and employee fringe benefit programs, including vacation policies), to the extent Purchaser makes them available to Business Employees, to recognize, solely service for the purposes purpose of determining the vesting of benefits and benefits, participation eligibility (but not for and benefit accrual), all service accrual by Transferred Employees with the SellersCompany, any of its Subsidiaries and Chancellor LA, including service with predecessor employers, employers to the extent that such service was recognized by the analogous benefit plans of Purchaserthe Company, provided any of its Subsidiaries or either Seller such that such recognition does not result in any duplication no break or interruption of benefits. Individuals who employment or participation shall be deemed to have terminated employment occurred with Sellers prior respect to the Closing Date and are subsequently hired by Purchaser and its Affiliates will not be entitled to any service recognition under this paragraph. Transferred Employees shall also be given credit for any deductible, co-payment amounts or out-of-pocket expenses paid in respect by reason of the plan year in which the Closing occurs, to the extent that, following the Closing, they participate in any corresponding plan maintained or sponsored transactions contemplated by Purchaser for which deductibles or co-payments are requiredthis Agreement. (b) Purchaser agrees that any pre-existing condition exclusions or waiting periods or evidence of insurability requirements imposed under Purchaser's welfare benefit plans will be waived no more restrictive than the analogous provisions under the applicable plans of Chancellor LA or the Company (and shall be applied utilizing the service crediting rules set forth in the last sentence of Section 6.5(a)) with respect to any Transferred Employee and his or her covered dependents and Purchaser (or Purchaser's employee benefit plans) shall assume all liabilities relating to all claims by Transferred Employees (and their dependents and beneficiaries) for benefits under all medical, dental, employee assistance, life, accidental death and dismemberment, dependent life, short- and long-term disability plans which are submitted on and after the same extent Closing Date (including claims related to hospital stays commenced on or before the Closing Date). Purchaser shall provide that such exclusions, waiting periods any expenses incurred under any Welfare Plan by a Transferred Employee or evidence of insurability did not preclude his or her participation in covered dependents during the equivalent plan year that includes the Closing Date shall be taken into account under any applicable health plan maintained by Purchaser for such plan year for purposes of the Sellerssatisfying applicable deductible, coinsurance and maximum out-of-pocket provisions. (c) Sellers Purchaser shall provide continuation coverage to Transferred Employees and former employees of the Company and its Subsidiaries (and their ERISA Affiliates shall be exclusively responsible for complying with covered dependents and qualified beneficiaries) who are receiving continuation coverage required under Code Section 4980B(f) ("COBRA Continuation Coverage") at the Closing, with respect to their employees with respect to any "whom a qualifying event" as such term is defined in COBRA, occurring on or event occurred prior to the Closing Date. (d) Seller agrees to cause and for which the accrued benefits and account balances of Transferred Employees under the Star Tobacco 401(k) Plan ("Sellers' 401(k) Plan") to be 100% vested effective as of the Closing Date. (e) Effective applicable election period for COBRA Continuation Coverage has not expired as of the Closing Date, Purchaser shall establish for the benefit of the Transferred Employees who, immediately prior to the Closing Date were participants in the Sellers' 401(k) Plan, a tax-qualified defined contribution plan or shall designate a pre-existing tax-qualified defined contribution plan, (in either case, "Purchaser's Plan"), which shall qualify as a cash or deferred plan under Section 401(k) of the Code and shall provide benefits only with respect to service after the Closing Date. Service with Seller or any prior employer recognized under the Sellers' 401(k) Plan shall be recognized for eligibility, vesting and all other purposes under Purchaser's Plan. As soon whom a qualifying event occurs as practicable after Purchaser's Plan is determined to be a tax qualified plan, Transferred Employees shall be permitted to make a rollover contribution from the Sellers' 401(k) Plan to Purchaser's Plan. (f) Purchaser shall be liable for all obligations with respect to claims of Transferred Employees for (i) workers compensation for incidents occurring on or after the Closing Date and (ii) for claims of such Transferred Employees that arise from or relate to facts, circumstances or conduct that occurred or are deemed to occur on or after the Closing Date. With respect to Transferred Employees, (i) a claim for health benefits (including, without limitation, claims for medical, prescription drug and dental expenses) will be deemed to have been incurred on the date on which the related medical service or material was rendered to or received by the Transferred Employee claiming such benefit, (ii) a claim for sickness or disability benefits based on an injury or illness occurring prior to the Closing Date will be deemed to have been incurred prior to the Closing Date, and (iii) in the case of any claim for benefits other than health benefits and sickness and disability benefits (e.g., life insurance benefits), a claim will be deemed to have been incurred upon the occurrence of the event giving rise to such claims. (g) Prior to Closing, and in any event within 90 days of the date of this Agreement, Purchaser shall, after consultation with the Sellers, establish a Retention Plan (the "Retention Plan") in an amount equal to $2,000,000 in the aggregate for payment to the Transferred Employees (i) who are employed by Purchaser or its Affiliates on the first anniversary result of the Closing Date or (ii) whose employment with Purchaser or its Affiliates has been terminated by Purchaser or its Affiliates other than for Cause prior to the first anniversary of the Closing Date. The aggregate transaction contemplated by this Agreement in compliance with the provisions of $2,000,000 of payments shall be allocated among the Transferred Employees in the manner set forth in the Retention Plan, except that in the event one or more Transferred Employees terminates their employment prior to the first anniversary of the Closing Date or the employment of one or more Transferred Employees is terminated by Purchaser or its Affiliates for Cause prior to such first anniversary, the $2,000,000 initially allocated under the Retention Plan shall be reduced by the amounts allocated to such Transferred Employees. As promptly as practicable after establishing the Retention Plan, Code Section 4980B and in any event within 90 days of the date of this Agreement, Purchaser shall deliver to Parent a copy of the Retention Plan and the Sellers shall be entitled to disclose to the Transferred Employees the terms of the Retention Plan. For purposes of the Retention Plan, "Cause" shall mean the termination of the employee's employment by reason of any one or more of the following: (i) failure, in the reasonable judgment of Purchaser, of the employee to satisfactorily perform the employee's duties; (ii) fraud or dishonesty in the performance of the employee's duties; or (iii) a breach of any of the policies of "General Conduct" contained in the Employee Handbook of Star Tobacco & Pharmaceuticals, Inc. to the extent such breach would be grounds for a termination for cause under such Employee Handbook. A failure of an employee to relocate the place of his employment beyond 20 miles from the current location of such employment at the request of Purchaser will not constitute "Cause" for termination of employmentERISA Section 601 et seq.

Certain Employee Benefits Matters. (a) All In the event the Merger is consummated, for a period of one year following the Effective Time and effective upon the Effective Time, Buyer shall, or shall cause the Surviving Corporation to, provide medical, 401(k), life and disability benefits, and other employee benefit plans, generally, to employees of the Business Employees who Surviving Corporation and its subsidiaries that, in the aggregate, are actively employed (including those on vacation) on substantially comparable to the Closing Date shall be offered employment on an "at will" basis with medical, 401(k), life and disability benefits and other benefits that were provided to such Surviving Corporation employees under the Purchaser on such date, and such individuals who accept such offer on such date shall be referred to employee benefit plans of the Company as "Transferred Employees." Each such offer of employment shall be (i) at the same salary or hourly wage rate and position in effect immediately prior to the Closing Date Effective Time and (ii) at that have been disclosed in the same location or within 20 miles from Company Disclosure Schedule. Without limiting the location of such employment immediately prior to the Closing Date. Purchaser shall also offer employment on an "at will" basis to each Business Employee who is temporarily absent from active employment on the Closing Date upon termination of such temporary absence within six months following the Closing Date, provided that such individual is able to perform the essential functions generality of the position he or she previously held with the Sellers prior to such absence, and any such individual shall be treated as a "Transferred Employee" from and after his or her date of employment with Purchaser. For a period of 12 months following the Closing Date, Purchaser shall provide benefits to the Business Employees that, in the aggregate, foregoing: (i) are substantially equivalent Buyer shall take such action or actions as may be necessary or appropriate so that, under the iBasis, Inc. 401(k) Retirement Plan (the "iBASIS PLAN"): (A) Surviving Corporation employees who were participants in the Company's 401(k) Retirement Plan (the "COMPANY PLAN") on the day before the Effective Time shall become eligible to those provided by Purchaser to its other similarly situated employees participate in the iBasis Plan as of the Closing Date and Effective Time; and (iiB) are no less favorable than those provided by Surviving Corporation employees who were participants in the Sellers and PriceInteractive Plan on the day before the Effective Time shall, with respect to their Subsidiaries participation thereafter under the Benefit Plans (other than benefits relating to stock options or other equityiBasis Plan, receive an employer matching contribution approximating 50% of their pre-based compensation) to such Business Employees immediately prior to the Closing Date. Purchaser shall cause Purchaser's employee benefit plans and arrangements (including, but not limited to, all "employee benefit plans" within the meaning of Section 3(3) of ERISA and all plans, programs, policies and employee fringe benefit programs, including vacation policies)tax savings contributions, to the extent Purchaser makes them available not in excess of 6% of compensation; and (ii) Buyer shall, or shall cause Surviving Corporation to, use its reasonable best efforts to Business Employeescause its medical insurance coverage to provide that, to recognize, solely for the purposes of determining the vesting of benefits and participation eligibility (but not for benefit accrual), all service by Transferred Employees with the Sellers, including service with predecessor employers, to the extent that such service was recognized by the analogous benefit plans of Purchaser, provided that such recognition does not result in any duplication of benefits. Individuals who have terminated employment with Sellers prior to the Closing Date and are subsequently hired by Purchaser and its Affiliates will not be entitled to any service recognition under this paragraph. Transferred Employees shall also be given credit for any deductible, co-payment amounts or out-of-pocket expenses paid in respect of the plan year in which the Closing Effective Time occurs, to the extent that, following the Closing, they participate in any corresponding plan maintained or sponsored amounts incurred by Purchaser for which deductibles or co-payments are required. (b) Purchaser agrees that any pre-existing condition exclusions or waiting periods or evidence of insurability requirements imposed under Purchaser's welfare benefit plans will be waived with respect to any Transferred Employee and his or her covered dependents to the same extent that such exclusions, waiting periods or evidence of insurability did not preclude his or her participation in the equivalent plan of the Sellers. (c) Sellers and their ERISA Affiliates shall be exclusively responsible for complying with COBRA with respect to their Surviving Corporation employees with respect to any "qualifying event" as such term is defined in COBRA, occurring on or prior to the Closing Date. (d) Seller agrees to cause the accrued benefits and account balances of Transferred Employees under the Star Tobacco 401(k) Plan ("Sellers' 401(k) Plan") to be 100% vested effective as of the Closing Date. (e) Effective as of the Closing Date, Purchaser shall establish for the benefit of the Transferred Employees who, immediately prior to the Closing Date who were participants in the Sellers' 401(k) PlanCompany medical plan as of the Effective Time will be recognized by the Buyer or Surviving Corporation's medical plan for purposes of determining applicable out-of-pocket deductibles, a taxco-qualified defined contribution plan pays and maximums. Nothing herein shall limit Buyer's authority under the iBasis Plan or Buyer's medical insurance coverage to modify, amend or terminate either such program at any time following the Effective Time. Any such modifications, amendments or terminations within the initial year following the Effective Time shall designate a pre-existing tax-qualified defined contribution plan, (be considered in either case, "Purchaser's Plan"determining whether Buyer is in compliance with the initial sentence of this Section 11.8(a), which shall qualify as a cash or deferred plan under Section 401(k) of the Code and shall provide benefits only with respect to service after the Closing Date. Service with Seller or any prior employer recognized under the Sellers' 401(k) Plan shall be recognized for eligibility, vesting and all other purposes under Purchaser's Plan. As soon as practicable after Purchaser's Plan is determined to be a tax qualified plan, Transferred Employees shall be permitted to make a rollover contribution from the Sellers' 401(k) Plan to Purchaser's Planhowever. (f) Purchaser shall be liable for all obligations with respect to claims of Transferred Employees for (i) workers compensation for incidents occurring on or after the Closing Date and (ii) for claims of such Transferred Employees that arise from or relate to facts, circumstances or conduct that occurred or are deemed to occur on or after the Closing Date. With respect to Transferred Employees, (i) a claim for health benefits (including, without limitation, claims for medical, prescription drug and dental expenses) will be deemed to have been incurred on the date on which the related medical service or material was rendered to or received by the Transferred Employee claiming such benefit, (ii) a claim for sickness or disability benefits based on an injury or illness occurring prior to the Closing Date will be deemed to have been incurred prior to the Closing Date, and (iii) in the case of any claim for benefits other than health benefits and sickness and disability benefits (e.g., life insurance benefits), a claim will be deemed to have been incurred upon the occurrence of the event giving rise to such claims. (g) Prior to Closing, and in any event within 90 days of the date of this Agreement, Purchaser shall, after consultation with the Sellers, establish a Retention Plan (the "Retention Plan") in an amount equal to $2,000,000 in the aggregate for payment to the Transferred Employees (i) who are employed by Purchaser or its Affiliates on the first anniversary of the Closing Date or (ii) whose employment with Purchaser or its Affiliates has been terminated by Purchaser or its Affiliates other than for Cause prior to the first anniversary of the Closing Date. The aggregate of $2,000,000 of payments shall be allocated among the Transferred Employees in the manner set forth in the Retention Plan, except that in the event one or more Transferred Employees terminates their employment prior to the first anniversary of the Closing Date or the employment of one or more Transferred Employees is terminated by Purchaser or its Affiliates for Cause prior to such first anniversary, the $2,000,000 initially allocated under the Retention Plan shall be reduced by the amounts allocated to such Transferred Employees. As promptly as practicable after establishing the Retention Plan, and in any event within 90 days of the date of this Agreement, Purchaser shall deliver to Parent a copy of the Retention Plan and the Sellers shall be entitled to disclose to the Transferred Employees the terms of the Retention Plan. For purposes of the Retention Plan, "Cause" shall mean the termination of the employee's employment by reason of any one or more of the following: (i) failure, in the reasonable judgment of Purchaser, of the employee to satisfactorily perform the employee's duties; (ii) fraud or dishonesty in the performance of the employee's duties; or (iii) a breach of any of the policies of "General Conduct" contained in the Employee Handbook of Star Tobacco & Pharmaceuticals, Inc. to the extent such breach would be grounds for a termination for cause under such Employee Handbook. A failure of an employee to relocate the place of his employment beyond 20 miles from the current location of such employment at the request of Purchaser will not constitute "Cause" for termination of employment.

Certain Employee Benefits Matters. (a) All For purposes of any benefit plan, program or arrangement maintained for benefit of employees of the Business Employees who are actively employed (including those on vacation) on Company at any time after the Closing Date Date, each such employee shall be offered employment on an "at will" basis receive credit for service with the Purchaser on such date, and such individuals who accept such offer on such date shall be referred to as "Transferred Employees." Each such offer of employment shall be (i) at the same salary or hourly wage rate and position in effect immediately Company prior to the Closing Date and (ii) at the same location or within 20 miles from the location except where doing so would cause a duplication of such employment immediately prior to the Closing Date. Purchaser shall also offer employment on an "at will" basis to each Business Employee who is temporarily absent from active employment on the Closing Date upon termination of such temporary absence within six months following the Closing Date, provided that such individual is able to perform the essential functions of the position he or she previously held with the Sellers prior to such absence, and any such individual shall be treated as a "Transferred Employee" from and after his or her date of employment with Purchaser. For a period of 12 months following the Closing Date, Purchaser shall provide benefits to the Business Employees that, in the aggregate, (i) are substantially equivalent to those provided by Purchaser to its other similarly situated employees as of the Closing Date and (ii) are no less favorable than those provided by the Sellers and their Subsidiaries under the Benefit Plans (other than benefits relating to stock options or other equity-based compensation) to such Business Employees immediately prior to the Closing Date. Purchaser shall cause Purchaser's employee benefit plans and arrangements (including, but not limited to, all "employee benefit plans" within the meaning of Section 3(3) of ERISA and all plans, programs, policies and employee fringe benefit programs, including vacation policiesbenefits), to the extent Purchaser makes them available such service is reflected in records of the Company and recognized under the corresponding Company employee benefit plan, for eligibility to Business Employeesparticipate and vesting and, but only with respect to recognizecalculation of the amount of any severance payments, solely for the purposes of determining the vesting of benefits vacation, sick and participation eligibility (but not paid time off, for benefit accrual), all service by Transferred Employees with the Sellers, including service with predecessor employers, to the extent that such service was recognized by the analogous benefit plans of Purchaser, provided that such recognition does not result in any duplication of benefitsaccrual purposes. Individuals who have terminated employment with Sellers prior to the Closing Date and are subsequently hired by Purchaser and its Affiliates will not be entitled to any service recognition under this paragraph. Transferred Employees Parent shall also be given credit for (x) use commercially reasonable efforts to cause any deductible, co-payment amounts or out-of-pocket expenses paid in respect of the plan year in which the Closing occurs, to the extent that, following the Closing, they participate in any corresponding plan maintained or sponsored by Purchaser for which deductibles or co-payments are required. (b) Purchaser agrees that any and all pre-existing condition exclusions conditions (or actively at work or similar limitations), eligibility waiting periods or and evidence of insurability requirements imposed under Purchaser's welfare benefit any group health plans will to be waived with respect to such employees and their eligible dependents and (y) provide such employees with credit for any Transferred Employee co-payments, deductibles, and his offsets (or her covered dependents similar payments) made during the plan year to the same extent that such exclusions, waiting periods or evidence of insurability did not preclude his or her participation reflected in the equivalent plan records of the Sellers. (c) Sellers and their ERISA Affiliates shall be exclusively responsible Company for complying with COBRA with respect the purposes of satisfying any applicable deductible, out-of-pocket, or similar requirements under any employee benefit plans, programs or arrangements in which they are eligible to their employees with respect to any "qualifying event" as such term is defined in COBRA, occurring on or prior to participate after the Closing Date. (db) Seller agrees to cause the accrued benefits and account balances of Transferred Employees under the Star Tobacco 401(k) Plan ("Sellers' 401(k) Plan") to be 100% vested The Company shall terminate, effective as of no later than the Closing Date. (e) Effective as of day immediately preceding the Closing Date, Purchaser shall establish for any Company Benefit Arrangements (including any Code Section 401(k) arrangement, any Company Benefit Arrangement intended to meet the benefit requirements of Code Section 125 and the Transferred Employees who, immediately Company Stock Plan) (each a “Terminated Benefit Plan”) (unless Parent provides written notice to the Company no later than three (3) Business Days prior to the Closing Date were participants that any such Company Benefit Arrangement shall not be terminated). The Company shall provide Parent with evidence that such Terminated Benefit Plan(s) have been terminated in the Sellers' 401(k) Planmanner provided in the preceding sentence by appropriate actions. The manner, a tax-qualified defined contribution plan or form and/or substance of such actions shall designate a pre-existing tax-qualified defined contribution plan, (in either case, "Purchaser's Plan")be subject to review and approval of Parent, which approval shall qualify as a cash not be unreasonably withheld, conditioned or deferred plan under Section 401(k) delayed, but such review and approval shall not diminish the Company’s obligation pursuant to the preceding sentences to terminate such Company Benefit Arrangements effectively. In the event that termination of the Code and shall provide benefits only with respect to service after the Closing Date. Service with Seller any Terminated Benefit Plan triggers any liquidation charges, surrender charges, or any prior employer recognized under the Sellers' 401(k) Plan other fees, then such charges or fees shall be recognized for eligibility, vesting and all other purposes under Purchaser's Plan. As soon as practicable after Purchaser's Plan is determined deemed to be a tax qualified plan, Transferred Employees shall be permitted to make a rollover contribution from the Sellers' 401(k) Plan to Purchaser's PlanCompany Transaction Expenses. (fc) Purchaser The provisions contained in this Section 5.7 are for the sole benefit of the respective parties hereto and no current or former employee, director, independent contractor, consultant, service provider or any other individual associated therewith shall be liable regarded for all obligations with respect any purpose as a third-party beneficiary of this Agreement. Nothing in this Section 5.7, express or implied, shall be construed or interpreted to claims of Transferred Employees for (i) workers compensation for incidents occurring on create any right, benefit or after the Closing Date and (ii) for claims of such Transferred Employees that arise from or relate to facts, circumstances or conduct that occurred or are deemed to occur on or after the Closing Date. With respect to Transferred Employees, (i) a claim for health benefits (including, without limitation, claims for medical, prescription drug and dental expenses) will be deemed to have been incurred on the date on which the related medical service or material was rendered to or received by the Transferred Employee claiming such benefit, (ii) a claim for sickness or disability benefits based on an injury or illness occurring prior to the Closing Date will be deemed to have been incurred prior to the Closing Date, and (iii) in the case remedy of any claim for benefits other than health benefits and sickness and disability benefits (e.g.nature whatsoever, life insurance benefits)including any right to continued employment or service, a claim will be deemed to have been incurred upon the occurrence of the event giving rise to such claims. (g) Prior to Closing, and in any event within 90 days of the date under or by reason of this Agreement, Purchaser shallin any other Person, after consultation with including any employees, former employees, any participant or any beneficiary thereof in any Company Benefit Arrangement or employee benefit plan of Parent, the SellersSurviving Entity or any of their Affiliates, establish a Retention Plan (the "Retention Plan") in an amount equal to $2,000,000 in the aggregate for payment to the Transferred Employees (i) who are employed by Purchaser or its Affiliates on the first anniversary of the Closing Date or (ii) whose employment with Purchaser amend any Company Benefit Arrangement or its Affiliates has been terminated by Purchaser employee benefit plan of Parent, the Surviving Entity or its Affiliates other than for Cause prior to the first anniversary any of the Closing Datetheir respective Affiliates. The aggregate of $2,000,000 of payments Nothing in this Section 5.7 shall be allocated among construed or interpreted to limit the Transferred Employees in the manner set forth in the Retention Plan, except that in the event one or more Transferred Employees terminates their employment prior to the first anniversary ability of the Closing Date or the employment of one or more Transferred Employees is terminated by Purchaser or its Affiliates for Cause prior to such first anniversaryParent, the $2,000,000 initially allocated under the Retention Plan shall be reduced by the amounts allocated to such Transferred Employees. As promptly as practicable after establishing the Retention Plan, and in any event within 90 days of the date of this Agreement, Purchaser shall deliver to Parent a copy of the Retention Plan and the Sellers shall be entitled to disclose to the Transferred Employees the terms of the Retention Plan. For purposes of the Retention Plan, "Cause" shall mean the termination of the employee's employment by reason of any one Surviving Entity or more of the following: (i) failure, in the reasonable judgment of Purchaser, of the employee to satisfactorily perform the employee's duties; (ii) fraud or dishonesty in the performance of the employee's duties; or (iii) a breach of any of the policies of "General Conduct" contained in the Employee Handbook of Star Tobacco & Pharmaceuticals, Inc. their respective Affiliates to the extent such breach would be grounds for a termination for cause under such Employee Handbook. A failure of an amend or terminate any employee benefit plan pursuant to relocate the place of his employment beyond 20 miles from the current location of such employment at the request of Purchaser will not constitute "Cause" for termination of employmentits terms.

Certain Employee Benefits Matters. (a) All For a period of at least 12 months following the Business Employees Closing, Buyer shall provide (or shall cause the Company to provide) each employee who are actively is employed (including those on vacation) on by the Company as of the Closing Date shall (a "Continuing Employee") with compensation and employee benefits (other than stock or other equity or equity-linked based plans) which are substantially comparable in the aggregate to those provided by the Company as of the date hereof. Buyer acknowledges that the Company Plans are all sponsored by Parent and that, after the Closing, all employee benefits will be offered employment on provided to employees of the Company under plans sponsored by Buyer or an "at will" basis with the Purchaser on such date, and such individuals who accept such offer on such date shall be referred to as "Transferred Employees." Each such offer Affiliate of employment shall be Buyer. Buyer agrees (i) to waive or have the Company waive any waiting period or limitations regarding pre-existing conditions with respect to Continuing Employees and their beneficiaries under any group health or other benefit plan maintained by Buyer for the benefit of any Continuing Employees after the Closing (but only to the extent that there would have been no such waiting period or limitations under the Company Plans if the transactions contemplated hereby had not been consummated), (ii) to credit any covered expenses incurred by any employee under Parent's group health plan prior to the Closing towards any deductibles, limits or out-of-pocket maximums under any group health plan maintained by Buyer for the benefit of any Continuing Employees after the Closing, (iii) to credit the service of each Continuing Employee with the Company or any of its Affiliates prior to the Closing for the purposes of determining such continuing Employee's Years of Service under plans maintained by Buyer for the benefit of any Continuing Employee after the Closing, (iv) subject to Section 9.3, provide severance benefits to Continuing Employees terminated without cause within 12 months of the Closing that are at least equal to the same salary or hourly wage rate and position severance that would have been provided by the Company under the Company's severance plans in effect immediately prior to the Closing Date Closing, and (iiv) at the same location or within 20 miles from the location of such employment immediately prior provide continuation health care coverage to the Closing Date. Purchaser shall also offer employment all Continuing Employees and their qualified beneficiaries who incur a qualifying event on an "at will" basis to each Business Employee who is temporarily absent from active employment on and after the Closing Date upon termination of such temporary absence within six months following in accordance with the Closing Date, provided that such individual is able to perform the essential functions continuation health care coverage requirements of the position he or she previously held with the Sellers prior to such absenceConsolidated Omnibus Budget Reconciliation Act of 1985, and any such individual shall be treated as a amended ("Transferred Employee" from and after his or her date of employment with Purchaser. For a period of 12 months following the Closing Date, Purchaser shall provide benefits to the Business Employees that, in the aggregate, (i) are substantially equivalent to those provided by Purchaser to its other similarly situated employees as of the Closing Date and (ii) are no less favorable than those provided by the Sellers and their Subsidiaries under the Benefit Plans (other than benefits relating to stock options or other equity-based compensation) to such Business Employees immediately prior to the Closing Date. Purchaser shall cause Purchaser's employee benefit plans and arrangements (including, but not limited to, all COBRA"employee benefit plans" within the meaning of Section 3(3) of ERISA and all plans, programs, policies and employee fringe benefit programs, including vacation policies), to the extent Purchaser makes them available to Business Employees, to recognize, solely for the purposes of determining the vesting of benefits and participation eligibility (but not for benefit accrual), all service by Transferred Employees with the Sellers, including service with predecessor employers, to the extent that such service was recognized by the analogous benefit plans of Purchaser, provided that such recognition does not result in any duplication of benefits. Individuals who have terminated employment with Sellers prior to the Closing Date and are subsequently hired by Purchaser and its Affiliates will not be entitled to any service recognition under this paragraph. Transferred Employees shall also be given credit for any deductible, co-payment amounts or out-of-pocket expenses paid in respect of the plan year in which the Closing occurs, to the extent that, following the Closing, they participate in any corresponding plan maintained or sponsored by Purchaser for which deductibles or co-payments are required. (b) Purchaser agrees that any pre-existing condition exclusions or waiting periods or evidence of insurability requirements imposed under Purchaser's welfare benefit plans Parent and Seller will be waived with respect to any Transferred Employee and his or her covered dependents to the same extent that such exclusions, waiting periods or evidence of insurability did not preclude his or her participation in the equivalent plan of the Sellers. (c) Sellers and their ERISA Affiliates shall be exclusively responsible for complying with COBRA with respect to their employees with respect to any "qualifying event" as such term is defined in COBRA, occurring on or prior to the Closing Date. (d) Seller agrees to cause the accrued benefits and account balances of Transferred Employees under the Star Tobacco 401(kSeller's Retirement Savings 401(K) Plan (the "Sellers' 401(kExisting 401(K) Plan") to be 100% vested effective as amended to provide that the transaction contemplated by this Agreement shall be a distributable event under the Existing 401(K) Plan. Buyer will amend its 401(K) Plan to accept rollover contributions and direct rollovers from the Continuing Employees, including any outstanding loans held under the Existing 401(K) Plan. In addition, Buyer shall assume responsibility for the cafeteria plan which is maintained under Section 125 of the Closing Date. (e) Effective as of the Closing Date, Purchaser shall establish Code for the benefit of the Transferred Continuing Employees whoof the Company, immediately and Seller shall provide to Buyer prior to the Closing Date were participants a list of those Continuing Employees participating in the Sellers' 401(k) Plan, a tax-qualified defined contribution plan or shall designate a pre-existing tax-qualified defined contribution cafeteria plan, (in either case, "Purchaser's Plan"), which shall qualify as together with a cash or deferred plan under Section 401(k) list of the Code and shall provide benefits only with respect to service after the Closing Date. Service with Seller or any prior employer recognized under the Sellers' 401(k) Plan shall be recognized for eligibility, vesting and all other purposes under Purchaser's Plan. As soon as practicable after Purchaser's Plan is determined to be a tax qualified plan, Transferred Employees shall be permitted to make a rollover contribution from the Sellers' 401(k) Plan to Purchaser's Plan. (f) Purchaser shall be liable for all obligations with respect to claims of Transferred Employees for (i) workers compensation for incidents occurring on or after the Closing Date and (ii) for claims of such Transferred Employees that arise from or relate to facts, circumstances or conduct that occurred or are deemed to occur on or after the Closing Date. With respect to Transferred Employees, (i) a claim for health benefits (including, without limitation, claims for medical, prescription drug and dental expenses) will be deemed to have been incurred on the date on which the related medical service or material was rendered to or received by the Transferred Employee claiming such benefit, (ii) a claim for sickness or disability benefits based on an injury or illness occurring prior to the Closing Date will be deemed to have been incurred their elections made prior to the Closing Date, and (iii) any balances in the case of any claim for benefits other than health benefits and sickness and disability benefits (e.g., life insurance benefits), a claim will be deemed to have been incurred upon the occurrence of the event giving rise to such claims. (g) Prior to Closing, and in any event within 90 days of the date of this Agreement, Purchaser shall, after consultation with the Sellers, establish a Retention Plan (the "Retention Plan") in an amount equal to $2,000,000 in the aggregate for payment to the Transferred Employees (i) who are employed by Purchaser or its Affiliates on the first anniversary of the Closing Date or (ii) whose employment with Purchaser or its Affiliates has been terminated by Purchaser or its Affiliates other than for Cause prior to the first anniversary their respective accounts as of the Closing Date. The aggregate of $2,000,000 of payments shall be allocated among the Transferred Employees in the manner set forth in the Retention Plan, except that in the event one or more Transferred Employees terminates their employment prior to the first anniversary of the Closing Date or the employment of one or more Transferred Employees is terminated by Purchaser or its Affiliates for Cause prior to such first anniversary, the $2,000,000 initially allocated under the Retention Plan shall be reduced by the amounts allocated to such Transferred Employees. As promptly as practicable after establishing the Retention Plan, and in any event within 90 days of the date of this Agreement, Purchaser shall deliver to Parent a copy of the Retention Plan and the Sellers shall be entitled to disclose to the Transferred Employees the terms of the Retention Plan. For purposes of the Retention Plan, "Cause" shall mean the termination of the employee's employment by reason of any one or more of the following: (i) failure, in the reasonable judgment of Purchaser, of the employee to satisfactorily perform the employee's duties; (ii) fraud or dishonesty in the performance of the employee's duties; or (iii) a breach of any of the policies of "General Conduct" contained in the Employee Handbook of Star Tobacco & Pharmaceuticals, Inc. to the extent such breach would be grounds for a termination for cause under such Employee Handbook. A failure of an employee to relocate the place of his employment beyond 20 miles from the current location of such employment at the request of Purchaser will not constitute "Cause" for termination of employment.

Certain Employee Benefits Matters. (a) All of On or before the Closing, Buyer shall offer employment to all US Business Employees who are actively employed (including those on vacation) on not covered by Business Collective Bargaining Agreements, except the Inactive US Business Employees to whom Buyer will make offers of employment upon the termination of any disability, layoff, or leave of absence within the six-month period following the Closing Date shall be offered employment on an "at will" basis with the Purchaser on such date, and such individuals who accept such offer on such date shall be referred to as "Transferred Employees." Date. Each such offer of employment shall be (i) at on the same salary base pay or hourly wage rate of pay and position conditions of employment substantially similar in effect immediately aggregate value, including any applicable post retirement medical benefits, to the existing terms and conditions of each such US Business Employee’s employment prior to the Closing; provided, however, that all pension and welfare benefits and benefit arrangements shall be provided under plans of Buyer (“Buyer’s Plans”). US Business Employees who are covered by a Business Collective Bargaining Agreement shall be employed by Buyer pursuant to the terms of such Business Collective Bargaining Agreement. All US Business Employees who accept such offers of employment of Buyer or who otherwise become employed by Buyer (the “Transferred Employees”) will become employees of Buyer (with the effect that no period of unemployment will occur with respect to any such Transferred Employees). Buyer shall be solely responsible for all compensation and benefits accrued or benefit claims filed by Transferred Employees on and after the Closing. The Asset Sellers will retain all liability for such benefits accrued or claims filed by US Business Employees prior to the Closing. In addition, Asset Sellers shall retain all obligations for benefits accrued and benefit claims filed by any Inactive Business Employee prior to employment by Buyer as a Transferred Employee and for benefits accrued and benefit claims filed by any US Business Employee who does not become a Transferred Employee. Any Buyer’s Plan in which Transferred Employees are eligible to participate shall provide that for purposes of determining eligibility to participate, vesting and for any schedule of benefits based on service (but not pension benefit amounts), all service with Asset Sellers and any predecessor that is recognized by Asset Sellers shall be recognized. Buyer’s Plans which provide medical, dental, vision, and health benefits to Transferred Employees shall provide such benefits without the applicability of any pre-existing physical or mental condition restrictions (other than those in effect on the Closing Date under a US Business Welfare Plan) and to the extent that a Transferred Employee has satisfied in whole or in part any annual deductible amount with respect to the calendar year in which the Closing Date occurs or paid any expenses pursuant to a co-insurance provision under a US Business Welfare Plan on the Closing Date, such Transferred Employee shall be credited with such amounts under the applicable Buyer’s Plan. (iib) at the same location Buyer agrees that it shall assume any collective bargaining agreements entered into with respect to US Business Employees (a “Business Collective Bargaining Agreement”); provided, however, that such obligation shall be subject to Buyer negotiating provisions relating to pension benefits and other benefits obligations (but not changes to wages or within 20 miles from the location other terms and conditions of such employment immediately employment) reasonably satisfactory to Buyer prior to the Closing Date. Purchaser PKI shall also offer employment on an "at will" basis use its best efforts to each Business Employee who is temporarily absent from active employment on the Closing Date upon termination of assist Buyer in negotiating such temporary absence within six months following the Closing Date, provided that such individual is able to perform the essential functions of the position he or she previously held with the Sellers prior to such absence, and any such individual shall be treated as a "Transferred Employee" from and after his or her date of employment with Purchaser. For a period of 12 months following the Closing Date, Purchaser shall provide benefits changes to the Business Employees that, in the aggregate, (i) are substantially equivalent to those provided by Purchaser to its other similarly situated employees as of the Closing Date and (ii) are no less favorable than those provided by the Sellers and their Subsidiaries under the Benefit Plans (other than benefits relating to stock options or other equity-based compensation) to such Business Employees immediately prior to the Closing Date. Purchaser shall cause Purchaser's employee benefit plans and arrangements (including, but not limited to, all "employee benefit plans" within the meaning of Section 3(3) of ERISA and all plans, programs, policies and employee fringe benefit programs, including vacation policies), to the extent Purchaser makes them available to Business Employees, to recognize, solely for the purposes of determining the vesting of benefits and participation eligibility (but not for benefit accrual), all service by Transferred Employees with the Sellers, including service with predecessor employers, to the extent that such service was recognized by the analogous benefit plans of Purchaser, provided that such recognition does not result in any duplication of benefits. Individuals who have terminated employment with Sellers prior to the Closing Date and are subsequently hired by Purchaser and its Affiliates will not be entitled to any service recognition under this paragraph. Transferred Employees shall also be given credit for any deductible, co-payment amounts or out-of-pocket expenses paid in respect of the plan year in which the Closing occurs, to the extent that, following the Closing, they participate in any corresponding plan maintained or sponsored by Purchaser for which deductibles or co-payments are required. (b) Purchaser agrees that any pre-existing condition exclusions or waiting periods or evidence of insurability requirements imposed under Purchaser's welfare benefit plans will be waived with respect to any Transferred Employee and his or her covered dependents to the same extent that such exclusions, waiting periods or evidence of insurability did not preclude his or her participation in the equivalent plan of the SellersCollective Bargaining Agreement. (c) Sellers Buyer agrees to provide any required notice under the Worker Adjustment and their ERISA Affiliates shall be exclusively responsible for complying Retraining Notification Act (“WARN”) and any other similar applicable law and to otherwise comply with COBRA with respect to their employees any such statute with respect to any "qualifying event" “plant closing” or “mass layoff’ (as such term is defined in COBRA, occurring on WARN) or prior to the Closing Date. (d) Seller agrees to cause the accrued benefits similar event affecting employees and account balances of Transferred Employees under the Star Tobacco 401(k) Plan ("Sellers' 401(k) Plan") to be 100% vested effective as of the Closing Date. (e) Effective as of the Closing Date, Purchaser shall establish for the benefit of the Transferred Employees who, immediately prior to the Closing Date were participants in the Sellers' 401(k) Plan, a tax-qualified defined contribution plan or shall designate a pre-existing tax-qualified defined contribution plan, (in either case, "Purchaser's Plan"), which shall qualify as a cash or deferred plan under Section 401(k) of the Code and shall provide benefits only with respect to service after the Closing Date. Service with Seller or any prior employer recognized under the Sellers' 401(k) Plan shall be recognized for eligibility, vesting and all other purposes under Purchaser's Plan. As soon as practicable after Purchaser's Plan is determined to be a tax qualified plan, Transferred Employees shall be permitted to make a rollover contribution from the Sellers' 401(k) Plan to Purchaser's Plan. (f) Purchaser shall be liable for all obligations with respect to claims of Transferred Employees for (i) workers compensation for incidents occurring on or after the Closing Date or arising as a result of the transactions contemplated hereby. Buyer shall indemnify and hold harmless Sellers and their Affiliates with respect to any liability under WARN or other similar applicable law arising from the actions (iior in actions) for claims of such Transferred Employees that arise from Buyer or relate to facts, circumstances or conduct that occurred or are deemed to occur its Affiliates on or after the Closing DateDate or arising as a result of the transactions contemplated hereby. (d) Asset Sellers shall be solely responsible for all workers’ compensation claims made by US Business Employees, including Transferred Employees, with respect to injuries or conditions occurring or sustained prior to the Closing. With Buyer shall be solely responsible for all workers’ compensation claims made by Transferred Employees with respect to injuries or conditions occurring or sustained after the Closing. (e) Buyer agrees to provide any required notice under COBRA and any other similar applicable law on or after the Closing Date with respect to Transferred Employees. Buyer shall assume all liabilities for post-employment health coverage under COBRA or otherwise with respect to Transferred Employees. Asset Sellers shall retain all responsibility and liability for post-employment health coverage under COBRA and any similar applicable law with respect to US Business Employees who do not become Transferred Employees. (f) Buyer shall employ all Foreign Business Employees employed by any Asset Seller, (i) a claim for health benefits (includingPKI Indonesia, without limitation, claims for medical, prescription drug or PKI France on and dental expenses) will be deemed to have been incurred on the date on which the related medical service or material was rendered to or received by the Transferred Employee claiming such benefit, (ii) a claim for sickness or disability benefits based on an injury or illness occurring prior to after the Closing Date will be deemed to have been incurred prior to on the Closing Date, terms and (iii) in the case of any claim for benefits other than health benefits and sickness and disability benefits (e.g., life insurance benefits), a claim will be deemed to have been incurred upon the occurrence of the event giving rise to such claims. (g) Prior to Closing, and in any event within 90 days of the date of this Agreement, Purchaser shall, after consultation with the Sellers, establish a Retention Plan (the "Retention Plan") in an amount equal to $2,000,000 in the aggregate for payment to the Transferred Employees (i) who are conditions on which they were employed by Purchaser such Asset Seller, PKI Indonesia, or its Affiliates PKI France. Buyer shall offer employment to all other Foreign Business Employees on the first anniversary of and after the Closing Date or (ii) whose employment with Purchaser or its Affiliates has been terminated by Purchaser or its Affiliates other than for Cause prior on generally comparable terms and conditions, subject to the first anniversary of the Closing Date. The aggregate of $2,000,000 of payments shall be allocated among the Transferred Employees in the manner set forth in the Retention Plan, except that in the event one or more Transferred Employees terminates their employment prior to the first anniversary of the Closing Date or the employment of one or more Transferred Employees is terminated by Purchaser or its Affiliates for Cause prior to such first anniversary, the $2,000,000 initially allocated under the Retention Plan shall be reduced by the amounts allocated to such Transferred Employees. As promptly as practicable after establishing the Retention Plan, and in any event within 90 days of the date of this Agreement, Purchaser shall deliver to Parent a copy of the Retention Plan and the Sellers shall be entitled to disclose to the Transferred Employees the terms of the Retention Plan. For purposes of the Retention Plan, "Cause" shall mean the termination of the employee's employment by reason of any one or more of the following: (i) failure, in the reasonable judgment of Purchaser, of the employee to satisfactorily perform the employee's duties; (ii) fraud or dishonesty in the performance of the employee's duties; or (iii) a breach of any of the policies of "General Conduct" contained in the Employee Handbook of Star Tobacco & Pharmaceuticals, Inc. to the extent such breach would be grounds for a termination for cause under such Employee Handbook. A failure of an employee to relocate the place of his employment beyond 20 miles from the current location of such employment at the request of Purchaser will not constitute "Cause" for termination of employmentapplicable law.