Philip Morris USA got a break today as an Illinois judge ordered it to pay only half of a $12 billion bond the cigarette maker said would force it into bankruptcy and end payments to 46 states under the national tobacco settlement.

The decision also clears the way for Philip Morris to pay its $2.6 billion share of the deal that is due Tuesday under the 1998 settlement, company spokesman David Tovar said.

Madison County Judge Nicholas G. Byron ordered the nation's largest tobacco company to put $6 billion into an escrow account to partially cover last month's $10.1 billion judgment in a class-action lawsuit. Philip Morris was found guilty of misleading smokers into believing "light" cigarettes are less harmful than regular brands.

The $6 billion will come as a loan from Philip Morris's corporate parent, Altria Group, according to the court order.

Philip Morris will then pay an additional $800 million through September 2004 toward the appeal bond, plus $420 million per year for however long the appeals in the case take, the order said.

Philip Morris will still have to pay the full $10.1 billion judgment plus costs and interest if it loses its appeal.

The reduced bond -- which plaintiffs attorney Stephen M. Tillery estimated will total about $9 billion over the course of a three- or four-year appeal -- takes the place of the $12 billion bond Byron originally ordered. That amount was for the judgment, plus costs and interest accrued during the appeal, as required by state law.

Philip Morris issued a statement calling the ruling "an onerous but viable solution to this issue."

The reduced bond was cheered by states awaiting their share of Philip Morris's $2.6 billion payment. The 1998 settlement with tobacco companies was for states to recoup the cost of treating sick smokers.

"We're very pleased," said Charles Price, spokesman for Oklahoma Attorney General Drew Edmondson, president of the National Association of Attorneys General. "This is good news for the states."

Officials from 33 states signed a friend-of-the-court brief asking Judge Byron to reduce the bond, after Philip Morris officials said paying the full amount would drive the company to file for bankruptcy and force it to default on the national settlement.