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Minutes of a Special Meeting of the Board of Directors of Philip Morris & Co. Ltd., Incorporated held at the office the Company, 100 Park Avenue, New York 17, N.Y., 1954 at 9:30 o'clock in the forenoon pursuan t of on February 16, to due notice mailed to all of the Directors. Present the following Directors: Messrs. 0. P. McComas L. W. C. 0. G. H. T. H. Hanson Hatcher Ames, Jr. Chalkley Absent: Messrs. K. H. A. H. E. E. Rocke y Riddell Lyon G. W. P. B. Brauburger Ryan, Jr. 4 i Mr. Paul D. Smith, a member of the firm of Conboy, Hewitt, O'Brien & Boardman, general counsel, was also present at the me e ting. The meeting was called to order by Mr. 0. P. McComas, who acted as Chairman in the absence of Mr. A. E. Lyon, and the Secretary recorded. On motion duly made and seconded, the following resolution was unanimously adopted: RESOLVED, That the minutes of the meeting of this Board held on January 27, 1954, copies of which were furnished to members of the Board, be and the same hereby are adopted as and for the minutes of the said meeting. Mr. I+?cComas stated that the exchange of Benson and Hedges stock for Philip Morris stock had been declared effective at the opening of business on February 4, 1954 and that it was now in order to determine the dollar amount at which the investment in

Benson and Hedges stock is to be recorded on the books of the Company and the dollar amount at which such shares are to be received and accepted. He then recalled that, as stated in the Prospectus, the investment was to be recorded at the fair market value of the Philip Morris Common Stock at the offering date. He stated that, while this was a 3udgment to be made by the'Board, Morgan Stanley & Co. and Lehman Bros. had been re- quested to submit reports bearing on the matter. Mr. L. G. Hanson thereupon read the letters of Philip Morris requesting such reports and the replies thereto to the meeting and a discussion ensued. Thereafter, on motion duly made and seconded, it was: RESOLVED, Tha t the fair marke t value of !{.00 , 000 to 443,561 shares of Philip Morris Common Stock on January 27, 1954 was $36 per share and that the shares of Benson and Hedges Common Stock hereto- fore or hereafter acquired pursuant to the exchange offer set forth in the Prospectus dated January 27, 1954 be recorded on the books of Philip Morris as an investment at $36 per share. The Secretary was ordered to file the aforesaid letters wi th the minute s of the me e ting . Mr. McComas then stated it was necessary to determine the valuation at which the Benson and Hedges shares were to be re- ceived and accepted and adverted, among other things, to earn- ings, book value, capital structure, size, market price, divi- dends, developments in the industry, and pro'ducts. Af ter dis- cussion, on motion duly made and seconded, the following resolution was unanimously adopted: aa ~ 4% RESOLVED, That the valuation at which the shares 1-10 of Common Stock of Benson and Hedges acquired by the cy ,.4. Company pursuant to the exchange offer se t forth , its Prospectus dated January 27, 195}} are to be in re- v N ~ ceived and accepted is 036 per share. .~,

The Board then took up the matter of increasing its membership and the following resolution, on motion made and seconded, was unanimously adopted: RESOLVED, That Section 2 of Article II of the By-Laws be amended to read as follows: "Number.--The number of directors shall be twel ve.tt Thereafter the following resolution, on motion duly made and seconded, was unanimously adopted: RESOLVED, That Messrs. Joseph F. Cullman, Jr., and Joseph F. Culiman, III, be and they hereby are elected Directors of this Company to hold office until the next annual meeting of stockholders and until their respective successors shall be duly elected. The Board then took up the matter of an Executive Committee and the election of an additional vice president. Upon motion duly made and seconded, the following resolutions were unanimously adopted: RESOhVED, That 0. Parker McComas, ex officio, A. E. Lyon, ex officio, and Joseph F. u ~, Jr., are designate to constitute an Executive Committee; and further RESOLVED, That until further order of this Board, the Chairman of the Executive Committee shall receive a salary at the rate of $20,000 per annum, payable in monthly installments; and further RESOLVED, That Mr. Joseph F. Culiman, III, be and he hereby is elected a vice president of this Company to hold office during the pleasure of the Board. The Messrs. Cullman thereupon joine d the meeting. Mr. McComas stated that he deemed it desirable that the Company's fiscal year should coincide with the calendar year. After discussion, on motion duly made and seconded, the follow- ing resolutions were unanimously adopted:

RESOLVED, That Article IX of the By-Laws be amended to read as follows: "Fiscal Year "Commencing with the year beginning January 1, 1955, the fiscal year of the corporation shall be the calendar year." And further RESOLVED, That the accounting period of the corporation for Federal income tax purposes shall, commencing with the year beginning January 1, 1955, be the calendar year; and further RESOLVED, That the period April 1, 1954 to December 31, 1954, inclusive, shall consti tute a fiscal year of the corporation; and further RESOLVED, Tha t e ffe c tive Augu s t l, 1954, Sec tion 1 of Artic le I of the By-Laws be amended to read as follows: "Annual Meetings.--The annual meeting of the stockholders for the election of directors and for the transac tion of such other business as may properly come before the meeting, shall be he ld a t 12 of clock noon, on the se cond Tue sday in April in each year, if not a legal holiday, and if a legal holiday, then on the next suc- ceeding business day." And further RESOLVED, That the foregoing resolutions shall be of no force and effect unless, prior to Janu- ary 1, 1955s the Commissioner of Internal Revenue shall have approved this corporation's application for the aforesaid change of accounting period for Federal income tax purposes or unless, as of such date, such application shall not be required. There followed a discussion of the business of the Company. There being no-further business to come before the meeting, the same adjourned. Secretary o t e Meeting