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i p.~ltp.i;:,~ R.J. Reynolds Industries, Inc. World Headquarters t Winston-Salem, N. C. 27102 J. Paul Sticht Chairman ~ Chief Executive Officer .'~prll 16, 1980 ~'~-:,!~.;~,~ ~f. H. Crohn, Esq. . }:::"~:~:~ ~neral Counsel and .Secretary R. J. Reynolds Tobacco Company ~inston-Salem, NC 27102 Dear Hax : :~'"'~ Bill Hobbs has agreed to undertake a very important assig~ent. ..... ~:;~:~:~ l'm writing to tell you about the asslg~ent and stress the ::~:~:~ supporting roles that some of us will need to play in assisting Bill. He has my full support. His assig~ent has a very high priority and your cooperstion is extremely important. ~p~d~~u~s. He*f1 study the grants we make directly to ~esearchers and znstttutzons as well as research we support :~i~;~i~ indirectly through vehicles llke the Council for Tobacco Research. :~:..~::i::, ~ you know, our total expenditures for biomedical research are :~:-~:~:~ very large and promise to grow larger in the future. Because the scale and likely expansion of our expenditures, it is important that we ~eassure ourselves about the effectiveness of the money that we're contributing to this important area. ~e end product of Bill~s assignment will be an appralsal of our ~ efforts, plus reco~endatlons for any changes that seem appro- "~:'~:'~-'~ At this point, Bill's subject matter groups itself into three major areas, Very briefly s~arlzed, these three major areas appear Eo be: (1) ~at~b~ectlves are we seeking with the several different components o~ our blo-medical research contributions? We 'clearly have se~ra! different objectives, It's importan¢ k that we make certain that the relative weights and priorities of our different research efforts are correctly proportioned among our different objectives and also that the progr~s under each objective are being carried out efflciently. ~::~.~ (2) ~ich individuals .~nd groups within the RJR family should have ~:'~.~. ii~J oversight over our different blo-medic~l~search expenditures? ?:~ ~o zn the Reynolds f~xly should have accountabzlttxes for approving the granting of funds, the monitoring of progress and evaluations of the expenditures we make? • ~:~::~::.-~ -.~.~ :. :~ ..~.~ , ,~:.:.p.~L~ ~'~'~ ~ ~t ~ ~ ~ ~..,..:~ ,-,.~ ~:1~ .:~: :~: :~:.m: : : =========================================== :~: -~h~ p... :~. :~

M. H, Crohn, Esq. April 16, 1980 Page 2 ~ (3) How can we best communicate with different audiences about our ~j~'.-.:i~: different research efforts? ~-~hin the blo-~edlcal communi~'~ :i~.~.~',~ii~ there are strict protocols for communicating results.among - a scientists. However, RJR has additlonal opportunities for communicating with employees, shareholders, leglslators and other public leaders about what we are doing in .the area of bio-medical research and what the findings have been. Clearly, each of these three is a large and important study area. Taken together, they constitute an imposing challenge. Bill has been assured that we will all do our part to help him meet his He will be in touch with us within the next few weeks to discuss his overall study plan and the part that you can play. Because of the urgency and importance of the subjects, Bill expects to have his work basically completed during the first half of June. If you have any questions, either Bill or I will be happy to discuss them with you. Meanwhile, we trust we can look forward to your full and prompt cooperation in this important effort. SinEerel~.~ , ~ . J:~Paul Sticht ~" ~.i:-'.'" cc: Mr. J, Tylee Wilson Mr. J. F. Abely Mr. Win. D. IIobba