Amy Horn


Altria Juul Purchase Agreement

The Commission accuses Altria of attacking this threat of competition by agreeing not to compete with JUUL in exchange for a significant interest in property. Weeks after Altria announced its intention to close its e-cigarette business, Altria and JUUL announced an agreement that made Altria JUUL the largest shareholder, allowed Altria to appoint an observer to JUUL`s board of directors and would have allowed Altria to appoint three members of JUUL`s executive committee after converting its shares into voting shares. JUUL received more than $12 billion, an agreement under which Altria would not compete with JUUL for six years, and a number of support services. “Altria`s exit agreement has eliminated one of JLI`s most dangerous rivals,” the FTC said, citing Juul. “As a large, well-established and well-funded company with long-standing relationships and considerable shelf space with retailers across the country, Altria had the resources and infrastructure to drive sales and compete aggressively.” 35%) and can only be reduced to the extent that Altria does not exercise its pre-emption rights described below or transfers JUUL shares. As long as the applicable percentage is at least 25%, the relationship agreement grants Altria a right of pre-emption in order to retain its property as a percentage of JUUL as a percentage of JUUL as juFIL issues additional capital guarantees to third parties that are not subject to the true-up guarantee. Conversely, JUUL has the right to exchange JUUL shares held by Altria in connection with certain JUUL offers and, each quarter, if Altria then owns more than the applicable percentage (for example. B, share repurchases or the loss of staff shares). Regardless of the percentage of Altrias ownership, Altrias cannot exceed the applicable percentage in JUUL. Altria and JUUL also entered into a service agreement under which Altria agreed to provide certain commercial services to JUUL at a cost of 3% for an initial period of six years. Altria will provide logistics and distribution services, access to retail shelves, youth prevention, cigarette packets, onserts, regulatory affairs and government affairs. Altria also agreed to grant JUUL a non-exclusive, free and unlimited, irrevocable and under-granted license to Altrias of intellectual property rights in the field of e-dampf not subject to a trademarked licence, subject to the conditions set out in an intellectual property licensing agreement between the parties.

The Federal Trade Commission revealed the agreement between the two companies in an anti-cartel complaint released Friday. The complaint cites new evidence from negotiations between the two companies that led to Altria`s $12.8 billion investment in Juul in December 2018. On December 20, 2018 (reference date), Altria entered into a term loan agreement with JPMorgan Chase Bank, N.A.

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