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2078190205 tNOte-. The Arieged Physicai Effect levels for last week were close to normal levels for Merit.) • Alleged Property - 5 for the week starting 11/27I200. Damage complaints which tend to track the coal drop off complaints decreased from the previous high of 17 complaints perweek.(Normal levels are around 1 APD complaint every 2 weeks so they are still 10 times normal levels ) . Consumer contacts simply expressing a dislike for the banded paper product self extinguishing feature - 47 for the week starting 1 1 /2 712 0 0. These complaints had peaked at 180 in October. Chart Chanaes The chart "Banded Paper Consumer Calls To Richmond Complaint Unit By Day Of The Week" has been re- labeled "Banded Paper New Consumer Cases Entered By Richmond Complaint Unit By Day Of The Week". This chart now reflects all new Merit Banded Paper consumer complaint cases entered into the data base by the Richmond Complaint Unit. This includes telephone, fax and mail contacts. The chart "Merit Coal Drop Off and Ash Fall Off Consumer Contacts Per Week" chart has been re-formatted as a stacked bar chart. The other charts have had cosmetic changes to allow them to be included in the 4th Quarter Management Review. Attached is the PowerPoint presentation containing the charts. MvitPSl2C1t0'.pypp If you have any questions regarding the information included in this update please let me know. William R. Warwick X4-3823 Complaint Handling and Analysis

-Original Message---- From: Warwick, William R. (Bill) Sent: Monday, December 04, 2000 10:09 AM To: A. Lilly; Alisia Rudd; Andrew McComb; Daniel Lisbon; David Compton; Jeffrey Slagle: Jennifer Hofler; Judith Smith: Judy Carboni; Linda Wettle; Melissa Jeltema; Michael Hawkins; Mike Watkins; Robert Fenner; Thomas Garguilo; Tony Phan; Tyrone Murray; Urs Nyffeler Cc: Boswell, Cindy T. Subject: Merit Banded Paper Update 1 2 /412 0 0 0 Per your request: The attached contains the latest updated charts on the Merit banded paper consumer complaints. SLJMMARY • Complaint levels continue to drop for Merit banded paper for the week starting 11/27/2000. The rates for taste and the self extinguishing feature are well below the peaks in October. Note: The figures for the week starting 11/2712000 only represented 4 days of call center availability. Complaint contact levels - 105 complaint contacts for the weeks starting 11/27/2000. Complaint contacts peaked at 378 during the week of 10/16 and are now about one third that level. The 105 complaints are still 5 times normal levels. Taste contacts -44 for the weeks starting 11/2712000. Taste complaints contacts peaked at 149 during the week of 10/2. Then they leveled out at 115 for 4 weeks and have now dropped to the 60 to 80 range which is still 10 times normal levels. • The Coal Drop Off complaints - 14 for the week starting 11/27/2000. The Coal Drop Off complaint rates have decreased from the peak 30 to 40 complaints per week in October. (Normal Coal Drop Off complaint levels are one complaint every two weeks and the 14 complaints last week represents over 28 times normal levels) The 100mm product Coal Drop Off / Ash Fall Off rates continue to be 3 times higher than the rates for similar products in King Size. • The Ash Fall Off complaints - 18 for the week starting 11/27/2000. This was the second highest level for this category. Ash Fall Off refers to consumers complaints that the ashes are continually flaking off. The continual flaking off is not allowing the consumer to maintain the ash on the cigarette until it reaches an ashtray following a draw. . The Merit banded paper surveys were implemented by the Complaint Handling and Analysis Department to provide additional information on some of the Banded paper issues. The updated survey results show the following: - Taste issues are being described as throughout the cigarette and not limited to re-lighting incidents. Only 9% associate the unsatisfactory taste to re-lighting incidents. - Only 43% the complaints about drop off incidents are referring to the ashes alone. In 49% of the survey responses they are describing the entire Ilt section as falling off the cigarette. The 86% of consumers are reporting the drop offs as frequent events. Over 67% of the incidents are reported while the cigarette is being held. In 74% of the incidents the consumers reported they were seated or driving. - Flare-ups are mostly occurring while re-lighting. (71% of the incidents) - Irregular Cigarette Burning incidents reported by the consumers include observed changes in the burning speed of the cigarette 38%, burning through the side of the cigarette 18% and incidents of the cigarette burning at an angle 12%. Note: The complaint level for flare ups and irregular burning are continuing at a high level. They are a combined 30 - 35 complaints per week. • Alleged Physical Effect - only 4 for the week starting 11/27/2000. APE complaints have continued to decrease from the peak high of 50 down to 4 which is a much faster reduction then the taste complaints. 1 4:47 PM