Common use of Excluded Assets and Excluded Liabilities Clause in Contracts

Excluded Assets and Excluded Liabilities. (a) The parties expressly acknowledge and agree that the following assets and properties (the “Excluded Assets”) shall be excluded from the Assets being purchased by Purchaser pursuant to this Agreement: (i) all cash and cash equivalents of Seller; (ii) all Assets set forth on Schedule 1.3 hereof; (iii) all Tax Returns and supporting materials, all original financial statements and supporting materials, all books and records that Seller is required by law to retain, all of Seller’s organizational documents, corporate books and records (including minute books and stock ledgers) and originals of account books of original entry, all records of Seller relating to the sale of the Assets and any documents relating to the Excluded Assets; and (iv) any right or interest in and to any Tax Asset, other than Prepaid Taxes, for periods (or portions thereof) ending on or before the Closing Date. (b) The parties expressly acknowledge and agree that the following liabilities and obligations (the “Excluded Liabilities”) shall be excluded from the liabilities being assumed by Purchaser pursuant to this Agreement: (i) all liabilities of Seller for Taxes, except to the extent Purchaser acquires Prepaid Taxes as set forth in Section 1.1(v) or except as otherwise provided herein; (ii) all Asbestos Liabilities; (iii) all liabilities of Seller for compliance with Environmental Laws prior to the Closing Date; (iv) any product liability claims concerning products which are sold by the Business prior to the Closing Date; (v) any indebtedness owed by Seller to its Affiliates as of the Closing Date for borrowed money or otherwise; (vi) the Employee Plans and all assets and liabilities related thereto, other than assets of the Seller’s 401(k) Plan related to current or former employees of the Business; (vii) all liabilities with respect to claims for workers compensation for incidents occurring prior to the Closing and remaining unpaid as of the Closing; and (viii) all liabilities with respect to claims arising out of the Asset Purchase Agreement, dated as of January 13, 2006, by and between Seller and Clutch Auto Limited, including guarantee of rent payments by Pioneer Clutch, Inc. that are due under the Lease Contract, dated as of January 17, 2006, by and among M▇▇ ▇▇▇▇▇ L.P., Pioneer Clutch, Inc., and Seller.

Excluded Assets and Excluded Liabilities. (a) The parties expressly acknowledge Notwithstanding anything contained in Section 2.1 to the contrary, there shall not be sold, assigned, transferred, conveyed and agree that delivered to the Buyer (or its permitted designee) hereunder any properties or assets other than the Acquired Properties, and there shall be retained by the Seller all such other properties or assets other than the Acquired Properties, including but not limited to, the following assets and properties (collectively, the “Excluded Assets”) shall be excluded from the Assets being purchased by Purchaser pursuant to this Agreement), without duplication: (i) all any cash and cash equivalents equivalent balances of Sellerthe Seller or its Subsidiaries other than cash security deposits to the extent the same are delivered to the Buyer (or its permitted designee) at Closing in accordance with Annex B; (ii) all Assets set forth on Schedule 1.3 hereofchecking accounts, bank accounts, certificates of deposit and time deposits of the Seller and its Subsidiaries; (iii) all any minute books, Tax Returns or other corporate documents or Books and supporting materials, all original financial statements Records of the Seller and supporting materials, all books and records its Subsidiaries that Seller is required by law to retain, all of Seller’s organizational documents, corporate books and records (including minute books and stock ledgers) and originals of account books of original entry, all records of Seller relating do not relate to the sale of Acquired Properties or the Assets and any documents relating to the Excluded Assets; andAssumed Liabilities; (iv) any right or interest in all losses, loss carryforwards and rights to receive refunds, credits and loss carryforwards with respect to any Tax Asset, other than Prepaid Taxes, and all Taxes for the taxable periods (or portions thereof) ending on or before the Closing Date; (v) any Contract pursuant to which the Seller or its Subsidiaries has incurred Indebtedness, whether to finance the operations of the Seller’s business, the Excluded Assets or otherwise; (vi) all Contracts other than the Assumed Contracts; (vii) all rights of the Seller under this Agreement and the other Transaction Documents or any amendments hereto or thereto; and (viii) all past, present or future claims, causes of action and rights by the Seller under, or with respect to this Agreement or against third parties to the extent relating to any Excluded Asset or Excluded Liability. (b) The parties expressly acknowledge and agree that Notwithstanding anything to the following contrary contained herein, the Seller shall be responsible for all of the liabilities and obligations that are not Assumed Liabilities (collectively, the “Excluded Liabilities”) ). Without limiting the generality of the foregoing, and except as otherwise expressly set forth in Section 2.2 above, the Buyer shall not assume any of the following, all of which shall be excluded from the liabilities being assumed by Purchaser pursuant to Excluded Liabilities for all purposes of this Agreement: (i) all liabilities any Liability of the Seller for Taxesor its Subsidiaries to be paid, except performed, satisfied or discharged prior to the extent Purchaser acquires Prepaid Taxes as set forth in Closing, or arising out of a breach on or prior to the Closing, under the Assumed Contracts, other than those for which the Buyer receives a credit at Closing pursuant to Section 1.1(v) or except as otherwise provided herein3.5 of this Agreement; (ii) all Asbestos Liabilitiesany Liability related to the ownership, lease, operation or use of the Acquired Properties prior to the Closing other than those for which the Buyer receives a credit at Closing pursuant to Section 3.5 of this Agreement; (iii) all liabilities of any Liability for which the Seller for compliance with Environmental Laws prior or its Affiliates are made responsible pursuant to the Closing Datethis Agreement or any Transaction Document; (iv) any product liability claims concerning products which are sold by Liability for Taxes of the Business prior Seller and its Subsidiaries (or any predecessors thereof) for any taxable period, except to the extent that the Buyer received a credit therefor at Closing Datepursuant to Section 3.5 of this Agreement; (v) any indebtedness owed by Seller Liability for Taxes relating to its Affiliates as of the Acquired Properties attributable to any taxable period ending on or before the Closing Date and for borrowed money or otherwisethe portion of any taxable period ending at the close of business on the Closing Date (determined as provided in Section 3.5 and except to the extent that the Buyer received a credit therefor at Closing pursuant to Section 3.5 of this Agreement); (vi) the Employee Plans and all assets and liabilities related thereto, other than assets of the Seller’s 401(k) Plan related any Liability with respect to current or former employees of the BusinessAffiliate Contracts; (vii) all liabilities with respect to claims for workers compensation for incidents occurring prior any Liability related to the Closing and remaining unpaid as of the ClosingExcluded Assets; and (viii) all liabilities any expenses incurred or payable directly or indirectly by the Seller or any of its Affiliates in connection with respect to claims arising out the consummation of the Asset Purchase Agreementtransactions contemplated by this Agreement or the process of selling the Acquired Properties, dated including, without limitation, (i) any fees and expenses of legal counsel, accountants, investment bankers or consultants and (ii) any bonus, change of control, non-compete, severance, transaction payment or similar payment that becomes payable by the Seller or its Subsidiaries to any Person as a result of the transactions contemplated by this Agreement that remains unpaid as of January 13, 2006, by and between Seller and Clutch Auto Limited, including guarantee of rent payments by Pioneer Clutch, Inc. that are due under the Lease Contract, dated as of January 17, 2006, by and among M▇▇ ▇▇▇▇▇ L.P., Pioneer Clutch, Inc., and SellerClosing.

Excluded Assets and Excluded Liabilities. (a) The parties expressly acknowledge After giving effect to the PSI Sale Restructuring in accordance with the PSI Sale Restructuring Plan, neither the Buyer nor any of its Affiliates (including any PSI Subsidiary) has any right, title or interest, in or to, and agree no Seller nor any of its respective Affiliates shall transfer to Buyer or any PSI Subsidiary at Closing, whether by virtue of the transfer of the PSI Interests, pursuant to this Agreement or the Transaction Documents, or otherwise, any of the assets, properties or rights, of the Sellers or their respective Affiliates (or any of their predecessors) that the following assets and properties are not Purchased Assets (collectively, the “Excluded Assets”), including the assets and properties of the Seller Parent or its Affiliates (or any of their predecessors) shall be excluded from the Assets being purchased by Purchaser pursuant to this Agreement: (i) all cash and cash equivalents of Seller; (ii) all Assets as set forth on in Schedule 1.3 hereof; (iii2.03(a) all Tax Returns and supporting materials, all original financial statements and supporting materials, all books and records that Seller is required by law to retain, all of Seller’s organizational documents, corporate books and records (including minute books and stock ledgers) and originals of account books of original entry, all records of Seller relating to the sale of the Assets and any documents relating to the Excluded Assets; and (iv) any right or interest in and to any Tax Asset, other than Prepaid Taxes, for periods (or portions thereof) ending on or before the Closing Dateattached hereto. (b) The parties expressly acknowledge Notwithstanding any provision in this Agreement or any other writing to the contrary, the Buyer and agree that the following PSI Subsidiaries are assuming from the Sellers or their respective Affiliates only the Assumed Liabilities and are not assuming any other liability or obligation of the Sellers or their respective Affiliates of whatever nature, whether presently in existence or arising hereafter. All such other liabilities and obligations shall be retained by and remain obligations and liabilities of the Sellers and the Non-PSI Subsidiaries (all such liabilities and obligations not being assumed being herein referred to as the “Excluded Liabilities”). Notwithstanding any provision in this Agreement or any other writing to the contrary, Excluded Liabilities (which shall not be assumed by the Buyer or the PSI Subsidiaries) shall be excluded from the liabilities being assumed by Purchaser pursuant to this Agreement: (i) all liabilities of Seller for Taxes, except to the extent Purchaser acquires Prepaid Taxes include such items as set forth in Section 1.1(vSchedule 2.03(b) or except as otherwise provided herein; (ii) all Asbestos Liabilities; (iii) all liabilities of Seller for compliance with Environmental Laws prior to the Closing Date; (iv) any product liability claims concerning products which are sold by the Business prior to the Closing Date; (v) any indebtedness owed by Seller to its Affiliates as of the Closing Date for borrowed money or otherwise; (vi) the Employee Plans and all assets and liabilities related thereto, other than assets of the Seller’s 401(k) Plan related to current or former employees of the Business; (vii) all liabilities with respect to claims for workers compensation for incidents occurring prior to the Closing and remaining unpaid as of the Closing; and (viii) all liabilities with respect to claims arising out of the Asset Purchase Agreement, dated as of January 13, 2006, by and between Seller and Clutch Auto Limited, including guarantee of rent payments by Pioneer Clutch, Inc. that are due under the Lease Contract, dated as of January 17, 2006, by and among M▇▇ ▇▇▇▇▇ L.P., Pioneer Clutch, Inc., and Sellerattached hereto.

Excluded Assets and Excluded Liabilities. Subject to Section 11.2 hereof, any asset (including Accounts Receivable) or any liability, all other remittances and all mail and other communications that is an Excluded Asset or an Excluded Liability (a) The parties expressly acknowledge pursuant to the terms of this Agreement, (b) as otherwise determined by the parties’ mutual written agreement or (c) absent such agreement, as determined by adjudication by a court or similar tribunal, and agree which comes into the possession, custody or control of Purchaser or TRH (or their respective successors-in-interest, assigns or affiliates) shall as promptly as reasonably practicable but in no event longer than fifteen (15) business days, be transferred, assigned or conveyed by Purchaser (and its respective successors-in-interest, assigns and affiliates) to Seller at Seller’s cost. Until such transfer, assignment and conveyance, Purchaser (and its respective successors-in-interest, assigns and affiliates) shall not have any right, title or interest in or obligation or responsibility with respect to such asset or liability except that Purchaser shall (and shall cause TRH to) hold such asset in trust for the following assets benefit of Seller. Purchaser (and properties its respective successors-in-interest, assigns and affiliates) shall have neither the right to offset amounts payable to Seller under this Section 9.1 against, nor the right to contest its obligation to transfer, assign and convey to Seller because of, outstanding claims, liabilities or obligations asserted by Purchaser against Seller including but not limited to pursuant to the post-Closing Cash Purchase Price adjustment of Section 1.4 and the indemnification provisions of Section 10.2. If Purchaser does not remit the Excluded Assets to Seller in accordance with the first sentence of this Section 9.1, such Excluded Assets shall bear interest at the Prime Rate in effect on the calendar day upon which such payment was required to be made to Seller (the “Excluded AssetsAsset Due Date”) plus five percent (5%) (or the maximum rate allowed by law, whichever is less), such interest accruing on each calendar day after the Excluded Asset Due Date until payment of the Excluded Assets and all interest thereon is made to Seller. With respect to payment received by Purchaser or TRH on account of Transition Services, this Section 9.1 shall be excluded from subject to the Assets being purchased by Purchaser pursuant provisions of Section 11.3. The terms of this Article 9 shall not be subject to the time limitations contained in Section 10.1 of this Agreement: (i) all cash and cash equivalents of Seller; (ii) all Assets set forth on Schedule 1.3 hereof; (iii) all Tax Returns and supporting materials, all original financial statements and supporting materials, all books and records that Seller is required by law to retain, all of Seller’s organizational documents, corporate books and records (including minute books and stock ledgers) and originals of account books of original entry, all records of Seller relating to the sale of the Assets and any documents relating to the Excluded Assets; and (iv) any right or interest in and to any Tax Asset, other than Prepaid Taxes, for periods (or portions thereof) ending on or before the Closing Date. (b) The parties expressly acknowledge and agree that the following liabilities and obligations (the “Excluded Liabilities”) shall be excluded from the liabilities being assumed by Purchaser pursuant to this Agreement: (i) all liabilities of Seller for Taxes, except to the extent Purchaser acquires Prepaid Taxes as set forth in Section 1.1(v) or except as otherwise provided herein; (ii) all Asbestos Liabilities; (iii) all liabilities of Seller for compliance with Environmental Laws prior to the Closing Date; (iv) any product liability claims concerning products which are sold by the Business prior to the Closing Date; (v) any indebtedness owed by Seller to its Affiliates as of the Closing Date for borrowed money or otherwise; (vi) the Employee Plans and all assets and liabilities related thereto, other than assets of the Seller’s 401(k) Plan related to current or former employees of the Business; (vii) all liabilities with respect to claims for workers compensation for incidents occurring prior to the Closing and remaining unpaid as of the Closing; and (viii) all liabilities with respect to claims arising out of the Asset Purchase Agreement, dated as of January 13, 2006, by and between Seller and Clutch Auto Limited, including guarantee of rent payments by Pioneer Clutch, Inc. that are due under the Lease Contract, dated as of January 17, 2006, by and among M▇▇ ▇▇▇▇▇ L.P., Pioneer Clutch, Inc., and Seller.

Excluded Assets and Excluded Liabilities. (a) The parties expressly acknowledge Anything contained in Section 1.1 to the contrary notwithstanding, all right, title and agree that interest to the following assets and properties (the “"Excluded Assets”") shall be excluded from the Assets being purchased by Purchaser pursuant to this Agreement: (i) other than the Transferred Cash, all cash and cash equivalents of Sellereach of the Sellers, including, without limitation, amounts deposited by either of the Sellers into escrow under the Qualifying Statutes; (ii) all Assets set forth right, title and interest in (including leaseholds and subleaseholds with respect to) those certain parcels of real property located in Chase City, Virginia and Bethesda, Maryland more particularly described on Schedule 1.3 hereofAnnex F, (the "Excluded Real Property") together with all improvements thereon, all fixtures affixed to such improvements and any and all rights relating to such real property; (iiiA) all Tax Returns machinery, equipment and supporting materials, all original financial statements other tangible personal property (1) used or held for use primarily in the Retained Businesses and supporting materials, all books and records that Seller is required held by law to retain, all of Seller’s organizational documents, corporate books and records (including minute books and stock ledgers) and originals of account books of original entry, all records of Seller relating to the sale either of the Assets and any documents relating to Sellers at one of the locations of the Excluded Assets; andReal Property or (2) listed on Annex G, and (B) StarCuredTM tobacco curing barns and associated equipment, wherever located; (iv) other than cut rag tobacco blends and cigarettes containing StarCuredTM tobacco, all items of inventory, including raw materials, work in process, finished goods, packaging materials, supplies and spare parts (A) relating to any right of the Retained Businesses, regardless of the location, or interest (B) containing or consisting of StarCuredTM leaf tobacco (the "Excluded Inventory"); (A) all inventions (whether patentable or unpatentable and whether or not reduced to practice), all improvements thereto and all patents, patent applications and patent disclosures, together with all reissuances, continuations, continuations-in-part, revisions, extensions and reexaminations thereof; (B) all trademarks, service marks, trade dress, logos, and trade names primarily used or held for use in the Retained Businesses and all corporate names, together with all translations, adaptations, variations, derivations and combinations thereof, including "Star," "Star Scientific", and "Star Tobacco," and including all goodwill associated therewith and all applications, registrations and renewals in connection therewith; (C) all copyrighted works, all applications, registrations, and renewals in connection therewith, and all works copyrightable but for their lack of fixation in a tangible medium, in each case to the extent primarily related to the Retained Businesses; (D) in each case on a non-exclusive basis, all trade secrets and confidential business information used or held for use in the operation of the Retained Businesses (including, without limitation, ideas, research and development, know-how, formulas, compositions, manufacturing and production processes and techniques, technical data, designs, drawings, specifications, customer and supplier lists, pricing and cost information and business and marketing plans and proposals); (E) all Internet domain names, including registrations and applications for registration thereof; and (F) all copies and tangible embodiments thereof (in whatever form or medium), in each case in clauses (A)-(F) including, without limitation, and in addition to, the Intellectual Property described on Annex H (collectively, the "Excluded Intellectual Property"); (vi) all of each Seller's rights in and to any Tax AssetAssets; (vii) each Seller's corporate franchises, certificates of incorporation, corporate seals, minute books, and (except for books, records, files and papers expressly described in clause (ix) of Section 1.1) other than Prepaid Taxescorporate records; (viii) all capital stock or other equity interests of each subsidiary of Parent, including, without limitation, Opco; (ix) except as otherwise expressly set forth herein, any trusts, trust assets, trust accounts, insurance policies or other assets of any "employee benefit plans" (as defined in Section 3(3) of ERISA) and any rights under any plan or agreement maintained by either Seller relating to employee benefits, employment or executive compensation of such Seller; (x) all insurance policies and binders and all claims, refunds and credits from such insurance policies or binders due or to become due with respect to such policies or binders; (xi) all claims, prepayments, refunds, deposits, prepaid expenses, causes of action, choses in action, rights of recovery, rights of set-off and rights of recoupment in favor of or for periods the benefit of either Seller (A) relating to the Excluded Assets and the Excluded Liabilities or portions thereof(B) ending described on Annex I; (xii) all rights of either of the Sellers and any of their Subsidiaries against any other of the Sellers and their Subsidiaries; (xiii) all rights of the Sellers under or before in respect of this Agreement, the License Agreement, the Escrow Agreement, the Post-Closing DateEscrow Agreement and the Contracts listed on Annex J; (xiv) all licenses, authorizations and permits issued or granted by any Governmental Authority used in the Business to the extent not transferable, and those described on Annex K; and (xv) all assets and properties used or held for use exclusively in the operation of the Retained Businesses. (b) The parties expressly acknowledge and agree that the following liabilities and obligations (the “"Excluded Liabilities”") shall be excluded from the liabilities being assumed by Purchaser pursuant to this Agreement: (i) all liabilities debts, liabilities, and obligations for Taxes arising out of Seller for Taxes, except or relating to the extent operation of the Business or the ownership of the Assets arising or accruing on or prior to the Closing Date (other than the obligations of Purchaser acquires Prepaid Taxes as set forth to pay the obligations and liabilities under the proviso to the first sentence in Section 1.1(v) or except as otherwise provided herein10.5); (ii) all Asbestos Liabilitiesany Funded Debt of either of the Sellers; (iii) other than Transferred Tobacco Liabilities, all liabilities arising solely out of the Excluded Assets (for the avoidance of doubt, for the purposes of this clause (iii) the Excluded Assets include the contracts listed in Annex J); (iv) all liabilities of Seller for compliance with Environmental Laws the Business prior to the Closing owing to the Sellers or any of their Subsidiaries; (v) except as otherwise expressly set forth herein, all liabilities relating to any Benefit Plan accruing, arising out of, or relating to, events occurring on or prior to the Closing Date; (ivvi) subject (with respect to Escrow Obligations arising during the Closing Year) to the provisions of Section 5.7, all debts, liabilities and obligations of either of the Sellers under any product liability claims concerning products which are sold by the Business Qualifying Statutes, including, but not limited to, any Escrow Obligations arising or accruing on or prior to the Closing Date; (v) any indebtedness owed by Seller to its Affiliates as of the Closing Date for borrowed money or otherwise; (vi) the Employee Plans and all assets and liabilities related thereto, other than assets of the Seller’s 401(k) Plan related to current or former employees of the Business; (vii) all liabilities with respect arising from or related to claims for workers compensation for incidents occurring prior any employee benefit plan within the meaning of Section 3(3) of ERISA which is subject to the Closing and remaining unpaid Title IV of ERISA as to which either of the ClosingSellers or any of their ERISA Affiliates has any obligation to contribute; and (viii) all liabilities with respect to claims arising out as of the Asset Purchase Agreement, dated as of January 13, 2006, by and between Seller and Clutch Auto Limited, including guarantee of rent payments by Pioneer Clutch, Inc. that are due under the Lease Contract, dated as of January 17, 2006, by and among M▇▇ ▇▇▇▇▇ L.P., Pioneer Clutch, Inc., and SellerClosing Date to Transferred Employees for accrued vacation.

Excluded Assets and Excluded Liabilities. Subject to Section 11.2 hereof and the second sentence of Section 5.5 hereof, any asset (including Accounts Receivable) or any liability, all other remittances and all mail and other communications that is an Excluded Asset or an Excluded Liability (a) The parties expressly acknowledge pursuant to the terms of this Agreement, (b) as otherwise determined by the parties' mutual written agreement or (c) absent such agreement, as determined by adjudication by a court or similar tribunal, and agree that which comes into the following assets and properties possession, custody or control of Purchaser (the “Excluded Assets”or its respective successors-in-interest, assigns or affiliates) shall within ten (10) business days following receipt be excluded from the Assets being purchased transferred, assigned or conveyed by Purchaser pursuant (and its respective successors-in-interest, assigns and affiliates) to this Agreement: Seller at Seller's cost. Until such transfer, assignment and conveyance, Purchaser (iand its respective successors-in-interest, assigns and affiliates) all cash and cash equivalents of Seller; (ii) all Assets set forth on Schedule 1.3 hereof; (iii) all Tax Returns and supporting materialsshall not have any right, all original financial statements and supporting materials, all books and records that Seller is required by law to retain, all of Seller’s organizational documents, corporate books and records (including minute books and stock ledgers) and originals of account books of original entry, all records of Seller relating to the sale of the Assets and any documents relating to the Excluded Assets; and (iv) any right title or interest in and to any Tax Asset, other than Prepaid Taxes, for periods (or portions thereof) ending on obligation or before the Closing Date. (b) The parties expressly acknowledge and agree that the following liabilities and obligations (the “Excluded Liabilities”) shall be excluded from the liabilities being assumed by Purchaser pursuant to this Agreement: (i) all liabilities of Seller for Taxes, except to the extent Purchaser acquires Prepaid Taxes as set forth in Section 1.1(v) or except as otherwise provided herein; (ii) all Asbestos Liabilities; (iii) all liabilities of Seller for compliance with Environmental Laws prior to the Closing Date; (iv) any product liability claims concerning products which are sold by the Business prior to the Closing Date; (v) any indebtedness owed by Seller to its Affiliates as of the Closing Date for borrowed money or otherwise; (vi) the Employee Plans and all assets and liabilities related thereto, other than assets of the Seller’s 401(k) Plan related to current or former employees of the Business; (vii) all liabilities responsibility with respect to claims such asset or liability except that Purchaser shall hold such asset in trust for workers compensation for incidents occurring prior the benefit of Seller. Purchaser (and its respective successors-in-interest, assigns and affiliates) shall have neither the right to offset amounts payable to Seller under this Section 9.1 against, nor the right to contest its obligation to transfer, assign and convey to Seller because of, outstanding claims, liabilities or obligations asserted by Purchaser against Seller including but not limited to pursuant to the post-Closing Cash Purchase Price adjustment of Section 1.4 and remaining unpaid as the indemnification provisions of the Closing; and (viii) all liabilities with Section 10.2. With respect to claims arising out payment received by Purchaser on account of Transition Services, this Section 9.1 shall be subject to the Asset Purchase provisions of Section 11.3. The terms of this Article 9 shall not be subject to the time limitations contained in Section 10.1 of this Agreement, dated as of January 13, 2006, by and between Seller and Clutch Auto Limited, including guarantee of rent payments by Pioneer Clutch, Inc. that are due under the Lease Contract, dated as of January 17, 2006, by and among M▇▇ ▇▇▇▇▇ L.P., Pioneer Clutch, Inc., and Seller.

Excluded Assets and Excluded Liabilities. (a) The parties expressly acknowledge and agree that the following assets and properties liabilities specifically related to the Company's operations at its Carson, California, Sacramento, California, Union City, California and Portland, Oregon facilities (the “Excluded Assets”"EXCLUDED FACILITIES") shall be excluded from are set forth on SCHEDULE 1.5 of the Assets being purchased by Purchaser pursuant Disclosure Schedules (the "EXCLUDED ASSETS" and the "EXCLUDED LIABILITIES"). Prior to this Agreement: the Closing, the Company will, and the Parent will cause the Company to, either (i) all cash complete the full or partial sale of the Excluded Facilities and cash equivalents of Seller; Excluded Assets to (and cause the Excluded Liabilities to be assumed by (to the extent such sale contemplates such assumption)) an unaffiliated third party, or (ii) to the extent not sold pursuant to clause (i), close the Excluded Facilities and terminate the employment of all Assets set forth on Schedule 1.3 hereof; employees employed at the Excluded Facilities (the "EXCLUDED ASSETS TRANSACTION"). Any sale of such facilities shall be effected pursuant to an Asset Purchase Agreement (or other documents) in a form reasonably acceptable to the Buyer. Prior to the Closing, the Company will (i) notify the collective bargaining representatives of any employees of the Excluded Facilities of the sale or closure of such facilities; (ii) fulfill any obligations to bargain with any unions over the sale or closure of such facilities (including by bargaining in good faith with such unions); and (iii) all Tax Returns and supporting materials, all original financial statements and supporting materials, all books and records that Seller is required by law to retain, all of Seller’s organizational documents, corporate books and records (including minute books and stock ledgers) and originals of account books of original entry, all records of Seller relating to the sale of the Assets negotiate any severance or other obligations and any documents relating to the Excluded Assets; and (iv) any right resolution of grievances or interest in and to any Tax Asset, other than Prepaid Taxes, for periods (or portions thereof) ending on or before the Closing Dateunfair labor practice charges. (b) The parties expressly acknowledge and agree that the following liabilities and obligations (the “Excluded Liabilities”provisions of this SECTION 1.5(B) shall be excluded from the liabilities being assumed by Purchaser pursuant to this Agreement: (i) all liabilities of Seller for Taxes, except apply if and to the extent Purchaser acquires Prepaid Taxes the Company does not complete the sale of all of the Excluded Facilities and Excluded Assets (as set forth in contemplated by Section 1.1(v1.5(a)(i)) or except as otherwise provided herein; (ii) all Asbestos Liabilities; (iii) all liabilities and novation of Seller for compliance with Environmental Laws the Excluded Liabilities prior to the Closing Date; (iv) any product liability claims concerning products which are sold by the Business prior to the Closing Date; (v) any indebtedness owed by Seller to its Affiliates as of the Closing Date for borrowed money or otherwise; (vi) the Employee Plans and all assets and liabilities related thereto, other than assets of the Seller’s 401(k) Plan related to current or former employees of the Business; (vii) all liabilities with respect to claims for workers compensation for incidents occurring prior to the Closing and remaining unpaid as of the Closing; and (viii) all liabilities with respect to claims arising out of the Asset Purchase Agreement, dated as of January 13, 2006, by and between Seller and Clutch Auto Limited, including guarantee of rent payments by Pioneer Clutch, Inc. that are due under the Lease Contract, dated as of January 17, 2006, by and among M▇▇ ▇▇▇▇▇ L.P., Pioneer Clutch, Inc., and Seller.

Excluded Assets and Excluded Liabilities. (a) The parties expressly acknowledge Subject to Section 11.2 hereof, any asset (including Accounts Receivable) or any liability, all other remittances and agree all mail and other communications that the following assets and properties (the “is an Excluded Assets”) shall be excluded from the Assets being purchased by Purchaser pursuant to this Agreement: Asset or an Excluded Liability (i) all cash and cash equivalents pursuant to the terms of Seller; this Agreement, (ii) all Assets set forth on Schedule 1.3 hereof; as otherwise determined by the parties' mutual written agreement or (iii) all Tax Returns absent such agreement, as determined by adjudication by a court or similar tribunal, and supporting materialswhich comes into the possession, all original financial statements custody or control of Purchaser (or its respective successors-in-interest, assigns or affiliates) shall within ten (10) business days following receipt be transferred, assigned or conveyed by Purchaser (and supporting materialsits respective successors-in-interest, all books assigns and records that affiliates) to Seller is required by law to retain, all of at Seller’s organizational documentscost. Until such transfer, corporate books assignment and records conveyance, Purchaser (including minute books and stock ledgersits respective successors-in-interest, assigns and affiliates) and originals of account books of original entryshall not have any right, all records of Seller relating to the sale of the Assets and any documents relating to the Excluded Assets; and (iv) any right title or interest in or obligation or responsibility with respect to such asset or liability except that Purchaser shall hold such asset in trust for the benefit of Seller. Purchaser (and its respective successors-in-interest, assigns and affiliates) shall have neither the right to any Tax Assetoffset amounts payable to Seller under this Section 9.1(a) against, other than Prepaid Taxesnor the right to contest its obligation to transfer, for periods (assign and convey to Seller because of, outstanding claims, liabilities or portions thereof) ending on or before obligations asserted by Purchaser against Seller including but not limited to pursuant to the post-Closing DateCash Purchase Price adjustment of Section 1.4 and the indemnification provisions of Section 10.2. (b) The parties expressly acknowledge and agree that the following liabilities and obligations Subject to Section 11.2 hereof, any asset (the “Excluded Liabilities”) shall be excluded from the liabilities being assumed including accounts receivable generated by Purchaser pursuant with respect to this Agreement: services provided by Purchaser on or after the Effective Time) or any liability, all other remittances and all mail and other communications that is an Asset or an Assumed Obligation (i) all liabilities of Seller for Taxes, except pursuant to the extent Purchaser acquires Prepaid Taxes as set forth in Section 1.1(v) or except as otherwise provided herein; terms of this Agreement, (ii) all Asbestos Liabilities; as otherwise determined by the parties' mutual written agreement or (iii) all liabilities absent such agreement, as determined by adjudication by a court or similar tribunal, and which comes into the possession, custody or control of Seller for compliance with Environmental Laws prior to the Closing Date; (ivor its respective successors-in-interest, assigns or affiliates) any product liability claims concerning products which are sold by the Business prior to the Closing Date; shall within ten (v10) any indebtedness owed business days following receipt be transferred, assigned or conveyed by Seller (and its respective successors-in-interest, assigns and affiliates) to Purchaser at Purchaser’s cost. Until such transfer, assignment and conveyance, Seller (and its Affiliates as of the Closing Date for borrowed money respective successors-in-interest, assigns and affiliates) shall not have any right, title or otherwise; (vi) the Employee Plans and all assets and liabilities related thereto, other than assets of the Seller’s 401(k) Plan related to current interest in or former employees of the Business; (vii) all liabilities obligation or responsibility with respect to claims such asset or liability except that Seller shall hold such asset in trust for workers compensation for incidents occurring prior the benefit of Purchaser. Seller (and its respective successors-in-interest, assigns and affiliates) shall have neither the right to offset amounts payable to Purchaser under this Section 9.1(b) against, nor the right to contest its obligation to transfer, assign and convey to Purchaser because of, outstanding claims, liabilities or obligations asserted by Seller against Purchaser including but not limited to pursuant to the post-Closing Cash Purchase Price adjustment of Section 1.4 and remaining unpaid as the indemnification provisions of the Closing; andSection 10.3. (viiic) all liabilities with With respect to claims arising out payment received by Purchaser or Seller on account of Transition Services or Non-Acute Transition Services, respectively, Sections 9.1(a) and 9.1(b) above shall be subject to the Asset Purchase provisions of Sections 11.3 and 11.4, respectively. The terms of this Article 9 shall not be subject to the time limitations contained in Section 10.1 of this Agreement, dated as of January 13, 2006, by and between Seller and Clutch Auto Limited, including guarantee of rent payments by Pioneer Clutch, Inc. that are due under the Lease Contract, dated as of January 17, 2006, by and among M▇▇ ▇▇▇▇▇ L.P., Pioneer Clutch, Inc., and Seller.”

Excluded Assets and Excluded Liabilities. Subject to Section 11.2 hereof, any asset (including Accounts Receivable) or any liability, all other remittances and all mail and other communications that is an Excluded Asset or an Excluded Liability (a) The parties expressly acknowledge pursuant to the terms of this Agreement, (b) as otherwise determined by the parties' mutual written agreement or (c) absent such agreement, as determined by adjudication by a court or similar tribunal, and agree that which comes into the following assets and properties possession, custody or control of Purchaser (the “Excluded Assets”or its respective successors-in-interest, assigns or affiliates) shall within ten (10) business days following receipt be excluded from the Assets being purchased transferred, assigned or conveyed by Purchaser pursuant (and its respective successors-in-interest, assigns and affiliates) to this Agreement: Seller at Seller's cost. Until such transfer, assignment and conveyance, Purchaser (iand its respective successors-in-interest, assigns and affiliates) all cash and cash equivalents of Seller; (ii) all Assets set forth on Schedule 1.3 hereof; (iii) all Tax Returns and supporting materialsshall not have any right, all original financial statements and supporting materials, all books and records that Seller is required by law to retain, all of Seller’s organizational documents, corporate books and records (including minute books and stock ledgers) and originals of account books of original entry, all records of Seller relating to the sale of the Assets and any documents relating to the Excluded Assets; and (iv) any right title or interest in and to any Tax Asset, other than Prepaid Taxes, for periods (or portions thereof) ending on obligation or before the Closing Date. (b) The parties expressly acknowledge and agree that the following liabilities and obligations (the “Excluded Liabilities”) shall be excluded from the liabilities being assumed by Purchaser pursuant to this Agreement: (i) all liabilities of Seller for Taxes, except to the extent Purchaser acquires Prepaid Taxes as set forth in Section 1.1(v) or except as otherwise provided herein; (ii) all Asbestos Liabilities; (iii) all liabilities of Seller for compliance with Environmental Laws prior to the Closing Date; (iv) any product liability claims concerning products which are sold by the Business prior to the Closing Date; (v) any indebtedness owed by Seller to its Affiliates as of the Closing Date for borrowed money or otherwise; (vi) the Employee Plans and all assets and liabilities related thereto, other than assets of the Seller’s 401(k) Plan related to current or former employees of the Business; (vii) all liabilities responsibility with respect to claims such asset or liability except that Purchaser shall hold such asset in trust for workers compensation for incidents occurring prior the benefit of Seller. Purchaser (and its respective successors-in-interest, assigns and affiliates) shall have neither the right to offset amounts payable to Seller under this Section 9.1 against, nor the right to contest its obligation to transfer, assign and convey to Seller because of, outstanding claims, liabilities or obligations asserted by Purchaser against Seller including but not limited to pursuant to the post-Closing Cash Purchase Price adjustment of Section 1.4 and remaining unpaid as the indemnification provisions of the Closing; and (viii) all liabilities with Section 10.2. With respect to claims arising out payment received by Purchaser on account of Transition Services, this Section 9.1 shall be subject to the Asset Purchase provisions of Section 11.3. The terms of this Article 9 shall not be subject to the time limitations contained in Section 10.1 of this Agreement, dated as of January 13, 2006, by and between Seller and Clutch Auto Limited, including guarantee of rent payments by Pioneer Clutch, Inc. that are due under the Lease Contract, dated as of January 17, 2006, by and among M▇▇ ▇▇▇▇▇ L.P., Pioneer Clutch, Inc., and Seller.

Excluded Assets and Excluded Liabilities. (a) The parties expressly acknowledge Anything contained in Section 1.1 to the contrary notwithstanding, all right, title and agree that interest to the following assets and properties (the “"Excluded Assets”") shall be excluded from the Assets being purchased by Purchaser pursuant to this Agreement: (i) other than the Transferred Cash, all cash and cash equivalents of Sellereach of the Sellers, including, without limitation, amounts deposited by either of the Sellers into escrow under the Qualifying Statutes; (ii) all Assets set forth right, title and interest in (including leaseholds and subleaseholds with respect to) those certain parcels of real property located in Chase City, Virginia and Bethesda, Maryland more particularly described on Schedule 1.3 hereofAnnex F, (the "Excluded Real Property") together with all improvements thereon, all fixtures affixed to such improvements and any and all rights relating to such real property; (iiiA) all Tax Returns machinery, equipment and supporting materials, all original financial statements other tangible personal property (1) used or held for use primarily in the Retained Businesses and supporting materials, all books and records that Seller is required held by law to retain, all of Seller’s organizational documents, corporate books and records (including minute books and stock ledgers) and originals of account books of original entry, all records of Seller relating to the sale either of the Assets and any documents relating to Sellers at one of the locations of the Excluded Assets; andReal Property or (2) listed on Annex G, and (B) StarCured(TM) tobacco curing barns and associated equipment, wherever located; (iv) other than cut rag tobacco blends and cigarettes containing StarCured(TM) tobacco, all items of inventory, including raw materials, work in process, finished goods, packaging materials, supplies and spare parts (A) relating to any right of the Retained Businesses, regardless of the location, or interest (B) containing or consisting of StarCured(TM) leaf tobacco (the "Excluded Inventory"); (A) all inventions (whether patentable or unpatentable and whether or not reduced to practice), all improvements thereto and all patents, patent applications and patent disclosures, together with all reissuances, continuations, continuations-in-part, revisions, extensions and reexaminations thereof; (B) all trademarks, service marks, trade dress, logos, and trade names primarily used or held for use in the Retained Businesses and all corporate names, together with all translations, adaptations, variations, derivations and combinations thereof, including "Star," "Star Scientific", and "Star Tobacco," and including all goodwill associated therewith and all applications, registrations and renewals in connection therewith; (C) all copyrighted works, all applications, registrations, and renewals in connection therewith, and all works copyrightable but for their lack of fixation in a tangible medium, in each case to the extent primarily related to the Retained Businesses; (D) in each case on a non-exclusive basis, all trade secrets and confidential business information used or held for use in the operation of the Retained Businesses (including, without limitation, ideas, research and development, know-how, formulas, compositions, manufacturing and production processes and techniques, technical data, designs, drawings, specifications, customer and supplier lists, pricing and cost information and business and marketing plans and proposals); (E) all Internet domain names, including registrations and applications for registration thereof; and (F) all copies and tangible embodiments thereof (in whatever form or medium), in each case in clauses (A)-(F) including, without limitation, and in addition to, the Intellectual Property described on Annex H (collectively, the "Excluded Intellectual Property"); (vi) all of each Seller's rights in and to any Tax AssetAssets; (vii) each Seller's corporate franchises, certificates of incorporation, corporate seals, minute books, and (except for books, records, files and papers expressly described in clause (ix) of Section 1.1) other than Prepaid Taxescorporate records; (viii) all capital stock or other equity interests of each subsidiary of Parent, including, without limitation, Opco; (ix) except as otherwise expressly set forth herein, any trusts, trust assets, trust accounts, insurance policies or other assets of any "employee benefit plans" (as defined in Section 3(3) of ERISA) and any rights under any plan or agreement maintained by either Seller relating to employee benefits, employment or executive compensation of such Seller; (x) all insurance policies and binders and all claims, refunds and credits from such insurance policies or binders due or to become due with respect to such policies or binders; (xi) all claims, prepayments, refunds, deposits, prepaid expenses, causes of action, choses in action, rights of recovery, rights of set-off and rights of recoupment in favor of or for periods the benefit of either Seller (A) relating to the Excluded Assets and the Excluded Liabilities or portions thereof(B) ending described on Annex I; (xii) all rights of either of the Sellers and any of their Subsidiaries against any other of the Sellers and their Subsidiaries; (xiii) all rights of the Sellers under or before in respect of this Agreement, the License Agreement, the Escrow Agreement, the Post-Closing DateEscrow Agreement and the Contracts listed on Annex J; (xiv) all licenses, authorizations and permits issued or granted by any Governmental Authority used in the Business to the extent not transferable, and those described on Annex K; and (xv) all assets and properties used or held for use exclusively in the operation of the Retained Businesses. (b) The parties expressly acknowledge and agree that the following liabilities and obligations (the “"Excluded Liabilities”") shall be excluded from the liabilities being assumed by Purchaser pursuant to this Agreement: (i) all liabilities debts, liabilities, and obligations for Taxes arising out of Seller for Taxes, except or relating to the extent operation of the Business or the ownership of the Assets arising or accruing on or prior to the Closing Date (other than the obligations of Purchaser acquires Prepaid Taxes as set forth to pay the obligations and liabilities under the proviso to the first sentence in Section 1.1(v) or except as otherwise provided herein10.5); (ii) all Asbestos Liabilitiesany Funded Debt of either of the Sellers; (iii) other than Transferred Tobacco Liabilities, all liabilities arising solely out of the Excluded Assets (for the avoidance of doubt, for the purposes of this clause (iii) the Excluded Assets include the contracts listed in Annex J); (iv) all liabilities of Seller for compliance with Environmental Laws the Business prior to the Closing owing to the Sellers or any of their Subsidiaries; (v) except as otherwise expressly set forth herein, all liabilities relating to any Benefit Plan accruing, arising out of, or relating to, events occurring on or prior to the Closing Date; (ivvi) subject (with respect to Escrow Obligations arising during the Closing Year) to the provisions of Section 5.7, all debts, liabilities and obligations of either of the Sellers under any product liability claims concerning products which are sold by the Business Qualifying Statutes, including, but not limited to, any Escrow Obligations arising or accruing on or prior to the Closing Date; (v) any indebtedness owed by Seller to its Affiliates as of the Closing Date for borrowed money or otherwise; (vi) the Employee Plans and all assets and liabilities related thereto, other than assets of the Seller’s 401(k) Plan related to current or former employees of the Business; (vii) all liabilities with respect arising from or related to claims for workers compensation for incidents occurring prior any employee benefit plan within the meaning of Section 3(3) of ERISA which is subject to the Closing and remaining unpaid Title IV of ERISA as to which either of the ClosingSellers or any of their ERISA Affiliates has any obligation to contribute; and (viii) all liabilities with respect to claims arising out as of the Asset Purchase Agreement, dated as of January 13, 2006, by and between Seller and Clutch Auto Limited, including guarantee of rent payments by Pioneer Clutch, Inc. that are due under the Lease Contract, dated as of January 17, 2006, by and among M▇▇ ▇▇▇▇▇ L.P., Pioneer Clutch, Inc., and SellerClosing Date to Transferred Employees for accrued vacation.