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THIS DOCUMENT SUBJECT TO DOMFIDENTIALITY AGREEMENT. EMPLOYMENT AGREEMENT between THE COUNCIL FOR TOBACCO RESEARCH - U.S.A., and SHELDON C. SO,•it•;---RS, M.D. effective as of ~ September 1, 1981 I INC. --- - --- -- NFIDENTIAL: ININAf&SOTA - N TOBACCO LITIGATION CT~ ;~ HN l 014•f164

THIS DOCUMENT SUBJECT TO CONFIDEHTIALlTY AGREEMENT. This AGREEMENT, made effective this first day of September, 1981 by and between THE COUNCIL FOR TOBACCO RESEr.RCH - U.S.A., INC. ("The Council"), a New York Not- For-Profit corporation with its principal office at 110 East 59th Street, New York, New York 10022, and SHELDON C. SOI*]ERS, M.D. ("Dr. Sommers"), an individual residing at Cambridge Way, P.O. Box 403, Alpine, New Jersey 07620. W I T N E S S E T H: WHEREAS, The Council wishes to assure itself of' / the services of,Dr. Sommers upon the terms and conditions hereinafter stated; and WHEREAS, Dr. Sommers is willing to serve in the employ of The Council for the period and upon the terms and conditions hereinafter stated; NOW•, THEREFORE, in consideration of the mutual covenants herein contained the parties hereto agree as follows: 1. Employment The Council agrees to employ Dr. Sommers, and Dr. Sommers agrees to enter the employ of The Council, for the period stated in paragraph-3(a) below and upon the other terms and conditions herein provided. 2. Position During the period of his.employment under this CO~OB CCO LIT GATIONTA t MR HN 0 1 4~:='ct; I E-

THIS DOCUMENT SUBJECT TO DONFlDEHTlA1lTY AGREEMENT. Agreement, Dr. Sommers agrees to Director of The Council. 3. Term and Duties serve as the Scientific (a) Period of Employment The period of Dr. Sommers' employment under this Agreement shall be deemed to have commenced as of the date first above written and shall continue through August 31, 1982 (such period being herein referred to as the "Period of E:r,ployment"). Unless either Dr. Sommers or The Council, by at least ninety (90) days notice in writing to the other prior to the expiration of the initial Period of Employment or any renewal Period of Employment, as provided herein, elects not to renew this Agreement, it shall be automatically renewed for an additional period of one year and such one year period shall be considered the applicable Period of Employment for all purposes of this Agreement. In the event that Dr. Sommers shall continue in the full time employment of The Council after August 31, 1982, such continued employ- ment shall be subject to the terms and conditions of this Agreement. (b) Duties Throughout the Period of Employment hereunder and except for illness, reasonable vacation periods and reasonable leaves of absence, Dr. Sommers shall devote a reasonable amount of his business time, attention, skill and efforts to CONFJDENTlAL: M.;P:NfiSU7A TOBACCO LITIGATION C`(`~`,M HN 014',.'~%GG)

THIS DOCUMENT SUBJECT TO CONFiDENTIALCiY AGREEMENT. i the faithful performance of his duties hereunder; provided, however, that Dr. Sommers reserves the right (i) to act as a consultant during periods mutualLy agreeable to The Council and Dr. Sommers, but not to exceed one day per calendar week, in regard to medical problems or other matters within his area of expertise, including specifically those relating to surgical pathology; (ii) to write, edit and publish any medical article, journal, book, pamphlet or treatise, a copy of such article, journal, book, pamphlet or treatise shall be provided by Dr. Sommers to The Council prior to publication thereof. 4. Comnensation and Other Matters the For all services rendered by Dr. Sommers in any capacity during an applicable Period of Employment under this Agreement, Dr. Sommers shall be paid compensation as provided in this paragraph 4. . (a) Minimum Base Salary I The Council shall pay to Dr. Sommers at a minimum base salary of $150,000 per year or at such higher rate as may from time to time be fixed by The Council, or by a Committee designated by The Council. Such minimum base salary shall be payable as follows: (i) $120,000 of such salary shall be payable during Dr. Sommers' Period of Em- ployment in accordance with the customary payroll practices of The Council, but in no event less frequently than monthly, CONFIDENTIAL: MINNESOTA TOBACCO LITIGATION CTR HIN 014f 67

THIS DOCUMENT SUBJECT TO WNf1DENTIAl1TY AGREEMENT. and (ii) $30,000 of such salary shall be deferred and pay- able as provided in paragraph 4(b). (b) Deferred Cc-.--ensation A written unfunded account of the total amount of Dr. Sommers' deferred compensation under this Agreement, including interest as hereinafter provided, shall be main- tained by The Council and an ancunt equal to the balance of such account shall be paid by The Council to Dr. Sommers or, in the event of his death, to his beneficiary or benefi- ciaries designated in writing, or, in the absence or lapse of such designation, to his estate, in five (5) ecual annual installments, commencing on the December 31st following the later of (i) Dr. Sommers' attainment of age seventy (70) or (ii) termination of Dr. Sommers' services under this Agreement and payable thereafter on Dece.::oer 31st of each of the next four (4) succeeding calendar years. Such deferred compensa- tion shall bear interest at a ra--e determined hereafter, commencing as of the last day of the applicable Period of Employment with respect to which such deferred compensation is earned, until paid. Deferred compensation earned under this Agreement shall bear interest, compounded and computed annually, at one percent (1%) below the current prime rate of interest prevailing at The Sank of New York as of the first business day of each calendar year; provided, however, that such annual rate of interest shall not exceed fifteen ( ONrlDENTIAL: MINNESOTA CTR , „ ~ 0 ~ ~ ,~ ,,, ,,,, TOBACCO LITIGATIO [;~'~+F }i~;;~,, '{,~ Qi, ~~~+, ~N

THIS DOCUMENT SUBJECT TO CANFiDENTIAUTY AGREEMENT. i percent (15%) per calendar year. (c) Other Matters The Council will proviq'e Dr. Sommers with a private office and staff; personnel assistance and office facilities suitable to and consonant with his position; expense accounts, professional association, society and organization member- Sommers. The Council shall pay or reimburse Dr. Sommers for all reasonable travel and other expenses incurred by Dr. Sommers in performing his obligations under this Agreement. All legal fees and disbursements incurred by Dr. Sommers in ships and any other reasonable item requested by Dr. (d) Reimbursement of Expenses connection with this Agreement shall be reimbursed by The Council. 5. ParticiDation in Benefit Plans During the applicable Period of Employment under this Agreement and during any subsequent period that he shall be entitled to receive payments from The Council under paragraphs 6(a) and 6(b) or paragraph 7 below, Dr. Sommers shall be eligible to receive.all benefits, emoluments and coverage (or their equivalent or counterparts) for which key executives are eligible under any present or future executive compensation program or empioyee benefit plan or program of The Council in accordance with the provisions of any such plan or program. Nothing in this Agreement shall preclude CONFIDGNTIAL: MII4NESDTA - TOBACCO LITIGATION CTR HN 014769

THIS DOCUMENT SUBJECT TO DONFIDENTIAL(TY AGREEMENT. The Council from terminating or amending any such group employee benefit plan or program so as to eliminate, reduce or otherwise change any benefit payable thereunder. 6., Benefits Payable_Uoon Disability or Death (a) Disability Benefits for First Six t•;onths In the event of the total disability (as herein- a:ter defined) of Dr. Sommers, The Council shall continue to pay Dr. Som.mers the compensation provided in paragraph 4 hereof during the period of his total disability; provided, however, that.in the.event Dr. Sommers is totally disabled for a continuous period exceeding six (6) calendar months' The Council may„ at its election, terminate this Agreement, in which event Dr. Sommers shall be entitled to receive the benefits described in paragraph 6(b) below. As used in this Agreement, the term "total disa- bility" shall mean the complete inability of Dr. Sommers to perform all of his duties under this Agreement as determined by an independent physician selec.ted with the approval of The Council and Dr. Sommers. (b) Disability Benefits After First Six Months In the event that Dr. Sommers is totally disabled for a period described in paragraph 6(a) above and The Council elects to terminate- this'Agreement pursuant thereto, The Council shall continue to pay Dr. Sommers a disability benefit in addition to any other benefit payable under this ~ i`~ ~ CO TOBACCO LITIGATION 1 A CTR HN 0 1 C

THIS DOCUMENT SUBJECT TO OONFIDENTIAUTY AGREEMENT. :greement equal to the compensation provided in paragraph 4 for the remainder of the applicable Period of Employment. Thereafter, The Council shall pay.to Dr. Sommers as a disabil- ity benefit in addition to any other benefit payable under this Agreement fifty percent (50%) of the compensation provided in paragraph 4 for twelve (12) additional calendar months. Payment of disability benefits under this paragraph 6(b) shall commence on the first day of the month coincident with or next following the termination of this Agreement under paragraph 6(a). (c) Services During Total Disability During the period Dr. Sommers shall be entitled to receive payments under paragraph 6(a) above, to the extent that he is physically and mentally able to do so, he shall furnish information and assistance to The Council and, in addition, upon reasonable request in writing from time to time, he shall make himself available to The Council to undertake reasonable assignments consistent with the dig- nity, importance, and scope of his prior position and his physical and mental health. (d) Death Benefits In addition to any death benefit which may be provided under The Council`s group term life insurance program, The Council shall also pay, or cause to be paid, to Dr. Sommers' designated beneficiary or beneficiaries an COtiPlDI'f:T1Al:: ~JTA E.r !['. f ,'! 0 1 `'Y ,rif~ ~ TOBACCO LITIGATtON

TNiS DOCUMENT SUBJECT TO CONf1DENTIAL(TY AGREEMENT. additional death benefit of $100,000. Such death benefit may be payable in one lump cash sum or installments, commenc- ing no later than the last day of the Period of Employment in which Dr.-Sommers' death occurs, as determined by The Council', in its sole discretion, taking into account any recuest of Dr. Sommers and his beneficiary or beneficiaries. The Council may purchase one or more term or other life or similar insurance policies in amounts to provide for its obligations under this paragraph 6. As used in.this Agreement, the term "beneficiary" shall mean the person or persons last designated as such'by Dr. Sommers or, if no such beneficiary shall survive Dr. So-mers, his estate. 7. Termination 'or Resignation (a) In addition to any other benefit payable to Dr. Sommers under the terms of this Agreement, upon termi- nation by The Council of Dr. Sommers' services under this Agreement for any reason other than as provided under para- graph 6(a), or in the event Dr. Sommers resigns and termi- nates his services under this Agreement for one or more reasons enumerated in paragraph 7(b), The Council shall continue to pay to Dr..Sommers the compensation which would have been provided to him under paragraph 4 for the remainder of the applicable Period of Employment, including a complete renewal Period of Employment, if any, if his services under this Agreement had not so terminated. 1 CONF1:..,....,.L_ i :.i.rvE50TA TOBACCO LITlGAT[ON CTR ~"~N 0 147`7`r~.''

THIS DOCUMENT SUBJECT TO WNFIDENTUUTI( AGREEMENT. (b) Upon any (i) material change by The Council of Dr. Sommers' functions, duties or responsibilities without his express written consent (any.such material change without his consent shall be deemed a continuing breach of this Agreement), (ii) liquidation, dissolution, consolidation or merger of The Council, or transfer of all or substantially all of its assets, or (iii) any other breach of this Agreement by The Council, Dr. Sommers shall have the right, upon not less than sixty (60) days advance written notice given within a reasonable period of time not to exceed (except in case of a continuing breach) four (4) calendar months after the event giving rise to said right, to resign and terminate his employment under this Agreement. 8. Health and Hospital Benefits In addition to any other health, hospital or major medical insurance or other medical benefit to which Dr. Sommers is entitled by reason of his employment by The Council, The Council.shall obtain.an insurance policy from a reputable insurer as agreed to by The Council and Dr. Sommers, providing for such health and hospital benefits as may be offered by such insurer as a supplement or wraparound to any Federal Medicare benefit or payment otherwise paid or payable to Dr. Sommers or on his b6half. 9. Withholding of Taxes The Council may withhold from any benefits payable COTOBACCO LITI~GATION~A CTR HN 0141 t3