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203 On motion of Mr. Perkins, seconded by Mr. Dawley, it was unani- mously RESOLVED: That the Advertising Budget for KENT Cigarettes for 1956, which was approved at a meeting of the Board of Directors held on January 18, 1956, be and the same hereby is amended so as to in- crease the previous authorization by $900,000., subject to the re- view of the Board periodically during the year. On motion duly made and seconded, the meeting adjourned. Secretary r t (See Book No. 16)

August 1, 1956 ~ol An adjourned meeting of the Board of Directors of P. Lorillard Company was held today at 2:00 P. M. at the office of the Company, 119 West 40th Street, New York City. There were present Messrs.: L. Gruber I. H. Peak J. J. Blacknall B. B. Parmele H. F. Temple G. O. Davies F. M. Walson T. L. Perkins F. G. Searle M. E. Dawley Anna F. Woessner, Secretary Mr. Gruber, President, presided and the Secretary acted as Secretary of the meeting. On motion duly made and seconded, the reading of the minutes of the previous meeting was dispensed with. The President pointed out to the meeting that there was a vacancy in the Board of Directors and stated that he recommended the election of Harold X. Schreder, Executive Vice President, Group Securities, Inc., which Company is a very substantial bolder of the common stock of this Company. Thereupon, On motion of Mr. Searle, seconded by Mr. Dawley, it was unani- mously RESOLVED: That Harold X. Schreder, a shareholder of the Company, be and he hereby is elected a member of the Board of Directors, ef- fective August 1, 1956, to serve until the next annual meeting of the stockholders or until his successor is duly elected and quali- fies. Thereupon, Mr. Schreder entered the meeting. Mr. Gruber then commented on the business affairs of the Company and his plans for its future progress. The President stated that he felt it would be very helpful in the administration of the Company's affairs to have a Finance Com- mittee, to have charge and supervision of the Company's financial affairs subject to the over-all control of the Board of Directors. He said he felt the powers to be given to this Committee should be of a general nature at this time, to be supplemented later with more details when experience had shown how this Committee could best fit into the Company's affairs. He said that he felt such Committee should be a small one, con- sisting of a Chairman and from two to four other members as the Board might from time to time determine. He stated that the Board had taken the first step along these lines at its meeting on July 23rd when it had appointed Mr. W. J. Halley Chairman of the Finance Com- mittee, and that he felt that steps should be taken at this meeting r-~,.~ ,:

202 to create the Committee. He stated that he would make recommenda- tions as to other menbers of the Committee at a later meeting. Thereupon, on eotion of Mr. Perkins, seconded by Mr. Walson, it was unanimously RESOLVED: That there is :hereby created a Finance Committee, to consist of a Chairman and not less than two nor more than four other members, to be elected from time to time by the Board of Directors and to continue as members of such Committee at the pleasure of the Board of Directors. Said Committee shall desig- nate a Vice Chairman from among its members and shall appoint a Secretary, who need not be a member of said Committee. The Com- mittee shall keep records of its proceedings and report all action taken by it at the next regular meeting of the Board of Directors. It shall fix its own rules of procedure, including provisions fixing the time and place of meetings, which shall be fixed at least as often as once each month, and the manner of calling and giving notice of special meetings. A majority of the members who shall at the time of any meeting constitute the Committee shall consti- tute a quorum and action may be taken by a vote of a majority of the members present at any regular or duly called special meeting at which a quorum is present; and FURTHER RESOLVED: That the Finance Committee shall have charge and supervision of all of the financial affairs of the Company, except as otherwise provided by law or by the Certificate of Incorporation and By-laws of the Company, and of such other matters as may be assigned to it from time to time by the Board of Directors, subject always to such action by way of rescission, alteration, revision or otherwise, as may be taken thereafter at any time or from time to time by the Board of Directors. The President stated that the next order of business would be to determine the compensation of Mr. Halley as Chairman of the Fihance Committee, and he stated that he recommended that his salary be fixed at the rate of $45,000 per annum, effective Aug- ust 1st. Thereupon, On motion of Mr. Temple, seconded by Mr. Peak, all voting in favor thereof except Mr. Schreder, who did not vote, it was RESOLVED: That the compensation of Mr. W. J. Halley be and it hereby is fixed at the rate of $45,000. per annum, effective August 1, 1956. Mr. Peak pointed out to the meeting that the Board had not fixed the compensation of Mr. Gruber as President of the Company, and stated that he recommended that it be fixed at the rate of $60,000. per annum, effective August 1st. Thereupon, On motion of Dr. Parmele, seconded by Mr. Blacknall, all voting in favor thereof except Mr. Gruber, who did not vote, it was RESOLVED: That the compensation of Mr. Lewis Gruber, Presi- dent, be and it hereby is fixed at the rate of $60,000. per annum, effective August 1, 1956. r. 4 .