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COMPROMISE AGREEMENT This agreement is made this day of 1981, by and between President and Fellows of Harvard College ("Harvard"), a corporation duly organized and existing under the t. f Constitution and law of The Commonwealth of Massachusetts, and the corporations set forth in Exhibit A to this Compromise Agreement (the "Tobacco Companies"), each of which is duly organized and existing in the state identified therewith in that exhibit. 1. Recitals. Harvard has previously entered into several agreements between itself, on the one hand, and the Tobacco Companies and Liggett Group, Inc., formerly known as Liggett & Myers Incorporated ("Liggett"), on the other (Liggett not being a party to this Compromise Agreement, nor an intended beneficiary thereof). These agreements are attached as Exhibit B. Pursuant to these agreements Harvard was to provide adequate facilities and certain services in connection with certain research known as the "Smoking and Health Research Program" (the "Research" ) to be conducted by Dr. Gary Huber (the "Principal Investigator"), and the Tobacco Companies and Liggett were to provide monies for (i) direct proj ect costs as approved by Dr. Huber ("direct costs" ), plus ( ii ) an amount equal to 10% of those direct costs as supplemental funds. Pursuant to these agreements Harvard has provided facilities, the adequacy of

e I . k which is disputed, and has rendered services and the Tobacco Companies, but not Liggett, have made certain payments to Harvard. The Research has now terminated. A controversy has arisen between Harvard and the Tobacco Companies concerning (i) amounts claimed by Harvard for direct R costs, plus 10% supplemental funds and (ii) the liability of the Tobacco Companies for such amounts claimed by Harvard, including amounts which have not been paid and which, according to the Tobacco Companies, was to be the share to be paid by Liggett. It is the intention of the parties to this Compromise Agreement forever to compromise and settle the controversy among them in respect of the Research. 2. Payment. The Tobacco Companies agree to pay Harvard the sum of $320, 654. 00 and' Harvard agrees that, upon full payment of that sum, and except as provided in Sections 4 and 6 hereof, it will forever forebear from asserting against the Tobacco Companies any claims or liabilities in respect of the Research, except as provided in Sections 4 and 6 hereof, and reserving its rights against Liggett. For administrative purposes, the foregoing sum is comprised as set forth in Exhibit C to this Compromise Agreement. The Tobacco Companies shall be individually responsible only for payment of their respective share of the amount specified'in this paragraph. Each company's proportionate share Exhibit A. 2 is set forth in

C 4 3. Releases. Upon the receipt by Harvard of the full amount set forth in Section 2'hereof, Harvard will deliver to each of the Tobacco Companies a covenant not to sue in the form attached~ hereto as Exhibit D. - 4. Indemnity. The parties acknowledge that one or more . claims have been made by persons claiming amounts due on account of goods or services rendered to the Principal Investigator as direct project costs in connection with the Research, which claims the Principal Investigator has disputed and the payment of which has not been approved by the Principal Investigator. The parties further acknowledge the possibility of the assertion of additional such claims, presently unknown to the parties, in the future. The Tobacco Companies agree that they will indemnify and hold Harvard harmless from and against any and all costs, including judgments, interest, attachment dissolution bond'fees, and counsel fees, on account of any and all such claims. Harvard~agrees that it will promptly give the Tobacco Companies notice of the assertion of any such claims against it, and that it will offer to the Tobacco Companies the right, at their own expense, to conduct and control the defense of any such claims. The liability of the Tobacco Companies under this Section is individual, not joint and'several, for their respective proportionate shares. 3

I 5. Reservation of Rights. Nothing in this agreement, in the covenants not to sue to be delivered pursuant hereto, in the payments to be made by the Tobacco Companies hereunder, or arising or occurring in any other manner shall be construed as releasing Liggett from all or any portion of the amount claimed by Harvard under agreements to which Liggett is a party, but rather Harvard reserves its rights against Liggett in their entirety. 6. Equipment. There is presently in storage in Boston, Massachusetts, certain equipment purchased by Harvard in connection with the Research, which, under the terms of the previous agreements between Harvard and the Tobacco Companies and Liggett (Exhibit B) is to belong to the Tobacco Companies and Liggett. The parties agree that, upon the receipt by Harvard of the full amount set forth in Section 2 hereof, the equipment will be released to the order of the Tobacco Companies. The Tobacco Companies agree that any and all storage charges incurred by it in respect of the equipment after August 1, 1981, shall be paid by the Tobacco Companies, and shall be added to the amount due Harvard from the Tobacco Companies under Section 2 hereof. The Tobacco Companies agree to indemnify and hold Harvard harmless from and against any and all claims made by Liggett in respect of any equipment hereafter delivered to the order of the Tobacco Companies, under the terms set forth in Section 4 hereof.

c 7. Notice. With respect to Section 6 hereof, notice or instruction from the Tobacco Companies shall be given by Mr. William W. Shinn or Mr. Lee E. Stanford of the firm of Shook, Hardy & Bacon, each of whom the Tobacco Companies each hereby irrevocably appoints as its general agent and attorney-in-fact in connection with this ~ Compromise Agreement. Notice to Harvard shall be given as follows: Dean Henry C. Meadow Harvard Medical School 25 Shattuck Street Boston, Massachusetts 02115, with copy to: G. Marshall Moriarty, Esq,. Ropes & Gray 225 Franklin Street Boston, Massachusetts 02110. Notice to the Tobacco Companies shall be given as follows: Lee E. Stanford, Esq. Shook, Hardy & Bacon 1101 Walnut, 20th Floor Kansas City, Missouri 64106 8. Miscellaneous. This agreement shall be governed by the law of The Commonwealth of Massachusetts, shall take effect as a sealed'instrurnent made therein, and shall be construed as an executory accord andnot a substituted contract. PRESIDENT AND FELLOWS OF HARVARD COLLEGE Date: By 5

C C AMER'I CAI*1 BRANDS, I NC . Date: Date: Date: Date: Date : ny BROWN & WILLIAMSON TOBACCO CORPORATION By ' LORILLARD, A DIVISION OF LOEWS THEATERS, INC. By PHILIP MORRIS INCORPORATED By R.J. REYNOLDS INDUSTRIES, INC. By U.S. TOBACCO COMPANY By Date: 6

EXHIBIT A State of Name of Company Incorporation Share Pursuant to Section 2 AMERICAN BRANDS, INC. : $39,561 BROWN & WILLIAMSON! TOBACCO CORPORATION $50,097 LORILLARD, A DIVISION OF LOEWS THEATERS, INC. $30,143 PHILIP MORRIS INCORPORATED $90,695 R.J. REYNOLDS INDUSTRIES, INC. $107',970 U.S. TOBACCO COMPANY $2,188

HARVARD SMOKING AND HEALTH RESEARCH PROGRAM - EXTENSION AGREEMENT f able from project monies available or to be made available during the current fiscal year. Any monies not required for such purpose shall be held for disposition as directed by the Grantors. gator, reasonable and necessary expenses required to terminate the work in progress in an orderly but expeditious manner shall be pay- ment, the sponsoring companies do not approve a substitute investi-' If, in accordance with paragraph 1 of the original agree- of ten percent (10%) of any semiannual payment made hereunder will be paid to Harvard Medical School as supplemental funds not as project costs. - aggregate principal amount of One Million Nine Hundred Fifty-eight Thousand Two Hundred Ninety-three and No/100 Dol•lars ($1,958,293.00) to be applied to the Smoking and Health Research Program for direct costs only. A budget is attached as Appendix A. An additional sum 1977, through June 30, 1980, as follows: -- 1. Grantors shall provide additional monies in the to provide funding for a Smoking and Health Research Program de- veloped by Harvard Medical School. Pursuant to the provisions of the commitment, funding would expire in 1977. However, the under- signed Grantors and Harvard Medical School.wish to provide further funding of the program for the three (3) academic_years of July 1, In 1972, a commitment was made by the undersigned Grantors that may be providing for the project and shall pay such amount. 3. A-11 equipment purchased with funds from either the original or the extended grant is and shall be the exclusive property of the Grantors, as they determine their respective in-• terests, and utilization of such equipment shall be only for 2. Harvard Medical School shall continue to be respon- sible for the project. This responsibility shall include providing or arranging for adequate housing, services and the like. Harvard Medical School shall determine the proportion of supplemental funds paid by Grantors that should be paid over to any other institution purposes of the Smoking and Health Research Program. 4. Harvard Medical School shall cause financial records to be maintained respecting all funds made available by Grantors. Said records shall be maintained consistent with generally accepted accounting principles and shall be made available for audit_by Grantorsq accountants upon reasonable notice from Grantors. Harvard Medical School shall require similar records (and acccss to thew by

Grantors' accountants) of any entity to which it disburses funds other than for the sole purchase of equipment and supplies. Grantors shall have a similar right to all records respecting any funds they make available for the present Smoking and Health Research Program. 5. The provisions of the 1972 Harvard Research Proposal Agreement, as amended hereby, shall continue to govern the extended Smoking and Health Research Program, including procedures and funding. In particular, no direct funds are to be expended without the approval of the principal investigator prior to the initiation of said expenditures. A copy of the original proposal is attached to and incorporated into this agreement by reference as Appendix B. This Extension Agreement shall be dated as of the date- the last of the signatories hereto executes it. HARVARD MEDICAL SCHOOL D.ATE : DATE: DATE: February 9, 1977 February 9, 1977 February 9, 1977 Franklin H. Ep ein, M.D. Herrman L. B1 gart Professor of Medicine Harvard Medical School THE FOLLOWING ARE EXECUTING THESE PRESENTS AS "GRANTORS": BROWN & WILLIAMSON TOBACCO CORPORATION DATE: F-C a. 2Y/ /177 By Princip 1 Investigator Executive ecretary, Committee on Research~and Development, H~vard Medi al School By

ZlGCo-TT L-'Ra v/= /,vC'. DATE: ~z,c /QYY ~,L_Q ILLARD, A DIVISION OF LOEWS THEATRES, INC. DATE : Fr b• !'P77 v By PHILIP MORRIS INCORPORATED DATE: as/S ?? By R. J. REYNOLDS INDUSTRIES, INC. DATE: By UNITED STATES TOBACCO COMPANY DATE: f c h. .Al l~77 kJ ~ ~ $Y~ - ~ AMERICAN BRANDS, INC. DATE : ~~1 ~ 7 7 7 BY 0 1• 1. -&64t-- 0::~