STOCK PURCHASE AGREEMENT

Exhibit 10

STOCK PURCHASE AGREEMENT

Dated as of October 31, 2007

by and among

ALTRIA GROUP, INC.,

BRADFORD HOLDINGS, INC.

and

JOHN MIDDLETON, INC.

TABLE OF CONTENTS

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STOCK PURCHASE AGREEMENT

THIS STOCK PURCHASE AGREEMENT (this “ Agreement ”), dated as of October 31, 2007, is by and among ALTRIA GROUP, INC., a Virginia corporation (“ Buyer ”), BRADFORD HOLDINGS, INC., a Delaware corporation (“ Seller ”), and JOHN MIDDLETON, INC., a Pennsylvania corporation (the “ Company ”). Unless otherwise specified, capitalized terms herein shall have the meaning ascribed to them in Article I .

WHEREAS, the Company and its subsidiary are engaged in the Business and the Company is a wholly-owned subsidiary of Seller;

WHEREAS, Buyer desires, either directly or through one or more of its subsidiaries designated by it, to purchase from Seller, and Seller desires to sell or cause to be sold to Buyer, 100% of the outstanding shares of capital stock of the Company upon the terms and subject to the conditions set forth herein (the “ Stock Purchase ”); and

WHEREAS, (a) the Board of Directors of Seller has determined that this Agreement is expedient, fair to and for the best interests of Seller and its stockholders and has approved this Agreement and the Stock Purchase, (b) the stockholders of Seller have approved this Agreement and the Stock Purchase and (c) the Board of Directors of Buyer has approved this Agreement and the Stock Purchase.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements contained in this Agreement, and intending to be legally bound hereby, the parties hereto agree as follows:

ARTICLE I

Certain Definitions

(a) As used in this Agreement the following terms shall have the following respective meanings:

“ Action ” shall mean any action, suit, arbitration or proceeding by or before any court, governmental or other regulatory or administrative agency or commission.

“ Affiliate ” shall mean, with respect to any Person, any other Person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such first Person. For purposes of this definition, the Business Entities will be treated as Affiliates of Seller until the Closing is completed and as Affiliates of Buyer after the Closing is completed. As used in this definition, “control” (including, with correlative meanings, “controlled by” and “under common control with”) shall mean possession, directly or indirectly, of the power to direct or cause the direction of the management and policies (whether through ownership of securities or partnership or other ownership interests, by contract or otherwise).

“ Books and Records ” shall mean the corporate minute and stock books of the Business Entities and all of the books and records primarily related to the operations of the Business

Entities or the Business, including, without limitation, books and records relating to employees of the Business Entities, the purchase of materials, supplies and services, research and development, manufacture and sale of products and services, advertising, packaging, promotional materials, dealings with customers of the Business Entities or the Business, governmental and regulatory applications, filings and correspondence, litigation, contractual arrangements and financial statements and associated records, but excluding books and records relating to employee benefit plans (other than Company Plans) administered by a Subsidiary of Seller and insurance purchased by a Subsidiary of Seller.

“ Business ” shall mean the business of manufacturing, developing, selling, distributing, advertising and marketing cigars and pipe tobacco and related accessories and the business generally reflected in the Business Financial Statements.

“ Business Day ” shall mean any day that is not a Saturday, Sunday or other day on which the commercial banks in New York City are authorized or required by Law to remain closed.

“ Business Entities ” shall mean the Company and its, and their, respective Subsidiaries.

“ Business Intellectual Property Rights ” means all Intellectual Property Rights (i) owned or licensed and used or held for use by any Business Entity or (ii) owned or licensed by Seller or any Continuing Affiliate and used pursuant to such license in whole or in part in the conduct of the Business, but excluding Intellectual Property Rights related to employee benefit plans and insurance.

“ Buyer Financial Advisor ” shall mean Centerview Partners LLC.

“ Business Key Persons ” shall mean the individuals listed on Schedule 1.1(a) to the Seller Disclosure Letter.

“ Business Material Adverse Effect ” means a material adverse effect on the business, assets, condition (financial or otherwise) or results of operations of the Business Entities taken as a whole, provided , in no event shall any of the following, alone or in combination, be deemed to constitute, nor shall any of the following be taken into account in determining whether there has been or shall be, a Business Material Adverse Effect: (i) any effect resulting from actions set forth in Section 5.12 or actions taken by any Business Entity which Buyer has requested or to which Buyer has consented; (ii) any effect (including any response or reaction of any competitor of the Business) to the extent resulting from the announcement or pendency of the transactions contemplated by this Agreement; (iii) any effect that results from events, circumstances or situations affecting the tobacco industry, or the cigar or pipe tobacco industry or the United States economy generally; (iv) any effect that results from events, circumstances or situations affecting general worldwide economic or capital market conditions; (v) any product Liability arising from the research, development, manufacture, sale, advertising, distribution, consuming, marketing or use of cigar or pipe tobacco products; (vi) any effect of any proposed or actual institution of any new, or interpretation of any existing, Laws affecting cigars, pipe tobacco or the tobacco industry generally; and (vii) any effect of any proposed or actual increase of any Taxes upon any Business Entity or upon any of the products or assets of the Business resulting from changes in Tax Laws.

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“ Business Material Employment Arrangement ” means (x) any Employment Agreement that provides to a current or former officer or employee of, or Individual Consultant to, any Business Entity any of the following: (i) an annual base salary or other annual compensation in excess of $150,000; (ii) a stated term of employment that expires on or after December 31, 2008 which is not currently or following the Stock Purchase terminable by a Business Entity upon 90 or fewer days notice and without the payment of severance or a similar obligation (other than pursuant to the Severance Plan referred to in Section 6.1(e) ); (iii) any other payments in excess of $150,000, including contingent, severance or other termination benefits or payments (other than pursuant to the Severance Plan referred to in Section 6.1(e) ); or (iv) the right to accelerate such Person’s material benefits as a result of the Stock Purchase, and (y) any written employment agreement or other written arrangement with respect to the compensation of any Business Key Person (other than pursuant to the Severance Plan referred to in Section 6.1(e) and the Bonus Plan as described in Schedule 5.4(viii) to the Seller Disclosure Letter).

“ Code ” shall mean the Internal Revenue Code of 1986, as amended, and any successor thereto.

“ Company Class A Common Stock ” shall mean the shares of voting Class A common stock, par value $0.10 per share, of the Company.

“ Company Class B Common Stock ” shall mean the shares of non-voting Class B common stock, par value $0.10 per share, of the Company.

“ Company First Preferred Stock ” shall mean the shares of non-voting First Preferred Stock, par value $100 per share, of the Company.

“ Company Plan ” shall mean any Employee Plan sponsored and maintained exclusively by, or for, any Business Entity and with respect to which only current and former employees, directors, or Individual Consultants of the Business Entity (and/or their beneficiaries and dependents) participate or benefit.

“ Continuing Affiliate ” shall mean any Affiliate of Seller, other than a Business Entity and other than the Persons listed on Schedule 1.1(b) to the Seller Disclosure Letter.

“ Contract ” means any agreement, contract, note, bond, mortgage, indenture, deed of trust, license, franchise, lease, instrument or guaranty, in whatever form, written or oral.

“ Covered Losses ” shall mean any and all losses, liabilities, fines, deficiencies, damages, costs and expenses (including, without limitation, interest and penalties due and payable with respect thereto and reasonable attorneys’ and accountants’ fees), including, without limitation any of the foregoing arising under or incurred in connection with any Action, order or consent decree of any Governmental Authority or award of any arbitrator of any kind, or any law, rule, regulation, contract, commitment or undertaking.

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“ Employment Agreement ” means a contract, offer letter or agreement of a Business Entity with or addressed to any individual who is rendering or has rendered services thereto as an employee or Individual Consultant to a Business Entity or pursuant to which a Business Entity has any actual or contingent liability or obligation to provide compensation and/or benefits in consideration for past, present or future services.

“ Employee Plan ” shall mean any Plan, including any Company Plan, providing benefits or covering any current or former employee, director or Individual Consultant of any Business Entity (or their dependents or beneficiaries) or with respect to which any Business Entity has any current liability or may have any liability prior to or immediately following the Stock Purchase.

“ ERISA ” shall mean the Employee Retirement Income Security Act of 1974, as amended.

“ ERISA Affiliate ” of any entity means any other entity that, together with such entity, would be treated as a single employer under Section 414(b) or (c) of the Code or Section 4001(a)(14) of ERISA (with respect to matters relating to Title IV of ERISA).

“ Governmental Authority ” shall mean any United States federal, state or local, or any foreign, government, governmental, regulatory or administrative authority, agency or commission or any court, tribunal, or judicial or arbitral body.

“ HSR Act ” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

“ Indebtedness ” shall mean, (i) the principal and premium (if any) in respect of all indebtedness of any Business Entity for the repayment of borrowed money, whether or not represented by bonds, debentures, notes or similar instruments, all accrued and unpaid interest thereon and any cost associated with prepaying any such debt; (ii) the principal and premium (if any) in respect of all other indebtedness of any Business Entity evidenced by bonds, debentures, notes or similar instruments, including all accrued and unpaid interest thereon; (iii) all obligations of any Business Entity as lessee or lessees under leases that constitute capital leases under U.S. GAAP or that are accounted for as capital leases in the Business Financial Statements; (iv) all obligations to pay the deferred and unpaid purchase price of property and equipment which have been delivered (other than trade payables and other similar obligations incurred in the ordinary course of business); (v) negative balances in bank accounts; (vi) net cash payment obligations under swaps, options, derivatives and other hedging agreements or arrangements that will be payable upon termination thereof (assuming they were terminated on the date of determination); and (vii) all Indebtedness of another Person referred to in clauses (i) through (vi) above guaranteed directly or indirectly, jointly or severally, in any manner by any of the Business Entities.

“ Individual Consultant ” means an individual natural person providing services to a Person in a capacity other than as an employee.

“ Intellectual Property Right ” means any trademark, service mark, trade name, mask work, invention, patent, patent application, invention disclosure, trade secret, copyright, know-how or proprietary information contained on any website, processes, formulae, products,

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technologies, discoveries, apparatus, Internet domain names, trade dress and general intangibles of like nature (together with goodwill), customer lists, confidential information, licenses, software, databases and compilations including any and all collections of data and all documentation thereof (including any registrations or applications for registration of any of the foregoing) or any other similar type of proprietary intellectual property right.

“ knowledge ” of (i) Seller and/or the Company shall mean the actual knowledge of any of the persons identified on Schedule 1.2 to the Seller Disclosure Letter and (ii) Buyer shall mean the actual knowledge of any of the persons identified on Schedule 1.2 to the Buyer Disclosure Letter, in each case after reasonable inquiry consistent with such person’s position.

“ Law ” shall mean any United States federal, state or local, or any foreign, order, writ, injunction, judgment, award, decree, statute, law, rule or regulation.

“ Liabilities ” shall mean any and all debts, liabilities and obligations, whether accrued or fixed, known or unknown, absolute or contingent, matured or unmatured or determined or determinable.

“ Lien ” shall mean any easement, encroachment, security interest, pledge, mortgage, lien, charge, encumbrance, proxy, voting trust or voting agreement.

“ PBGC ” means the Pension Benefit Guaranty Corporation.

“ Permitted Liens ” shall mean all (x) Liens (i) which are reflected or reserved against in the Business Balance Sheet (up to the amounts so reflected or reserved against), (ii) which arise out of Taxes, general or special assessments or other governmental fees or charges not in default and payable without penalty or interest or the validity of which is being contested in good faith by appropriate proceedings, (iii) of carriers, warehousemen, mechanics, materialmen and other similar persons or otherwise imposed by Law incurred in the ordinary course of business for sums not yet delinquent or being contested in good faith, (iv) which relate to deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other types of social security or (v) which do not materially impair the use of the asset subject thereof for the purposes for which currently used; (y) in the case of the Business Real Property, (i) easements, quasi-easements, licenses, covenants, rights-of-way, rights of re-entry or other similar restrictions that are shown by a current title report or other similar report or listing, (ii) any conditions that are shown by a current survey or physical inspection and (iii) zoning, building, subdivision or other similar requirements or restrictions, in the case of each of the agreements, conditions, restrictions or other matters referenced in this clause (y) which do not materially impair the use of the applicable property encumbered thereby for the purposes for which it is currently used; and (z) other immaterial Liens.

“ Person ” shall mean any individual, corporation, partnership, limited liability company, association, trust or other entity or organization, including a government or political subdivision or an agency or instrumentality thereof.

“ Plan ” shall mean, whether or not written, any “employee benefit plan” (as defined in Section 3(3) of ERISA, but regardless of whether subject to ERISA), each plan, arrangement

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or policy providing for bonuses, stock option, stock purchase or other stock related rights or other forms of incentive or deferred compensation, severance, vacation, workers’ compensation, health, life, disability, sick leave or medical benefits, insurance coverage (including any self-insured arrangements), or post-employment, retirement or pension benefits, change of control or fringe benefits, that is sponsored or maintained by the Seller or any Business Entity or any of their ERISA Affiliates or to which the Seller, any Business Entity or any of their ERISA Affiliates contributes or is obligated to contribute, including without limitation any employee welfare benefit plan within the meaning of Section 3(1) of ERISA, any employee pension benefit plan within the meaning of Section 3(2) of ERISA (whether or not such plan is subject to ERISA).

“ Purchase Price ” for the Shares shall mean Two Billion Nine Hundred Million Dollars ($2,900,000,000), subject to adjustment pursuant to Item 3 of Exhibit 5.4 referenced in Schedule 5.4(viii) to the Seller Disclosure Letter.

“ Remedial Action ” means (a) action to clean up soil, surface water, groundwater, pollution or sediments in response to a release or threatened release of Hazardous Materials, including associated action taken to investigate, monitor, assess and evaluate the extent and severity of any such release; post-remediation monitoring of any such release; and preparation of all reports, studies, analyses or other documents relating to the above and (b) any judicial, administrative or other proceeding relating to any of the above, including the negotiation and execution of judicial or administrative consent decrees; responding to governmental information requests; or defending claims brought by any Governmental Authority or any other Person, whether such claims are equitable or legal in nature, relating to the cleanup of soil, surface water, groundwater, pollution or sediments in response to a release of Hazardous Materials and associated actions.

“ Securities Act ” shall mean the Securities Act of 1933, as amended.

“ Seller Financial Advisor ” shall mean Sandler O’Neill & Partners, L.P.

“ Shareholder ” shall have the meaning ascribed to such term in the Non-Competition and Non-Solicitation Agreement.

“ Subsidiary ” shall mean, with respect to any Person, any other entity of which securities or other ownership interests having ordinary power to elect a majority of the board of directors or other persons performing similar functions of such entity are directly or indirectly owned by such Person.

“ U.S. GAAP ” shall mean United States generally accepted accounting principles.

“ Withdrawal Liability ” shall mean liability to or with respect to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as those terms are defined in Title IV of ERISA.

“ Working Capital ” as of a specified date, shall mean the excess of: the (i) current assets, adjusted as set forth in the following sentence, less (ii) current liabilities, adjusted as set forth in the following sentence, in each case, of the Company on a consolidated basis, all as determined (a) in accordance with U.S. GAAP and determined in a manner consistent with the

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methods, principles and classifications used in preparing the Business Balance Sheet included in the Business Financial Statements and (b) on a basis consistent with the detailed statement of Working Capital attached as Schedule 1.3 to the Seller Disclosure Letter. For purposes of calculating Working Capital, (A) current assets shall be adjusted to the extent necessary to exclude (1) the overpayment of federal excise taxes on cigars and (2) the Closing Date Cash required by Section 5.10(b)(ii) , and (B) current liabilities shall be adjusted to the extent necessary to exclude any liabilities associated with (u) incurred but not yet reported claims under the Hunter Service Company self-insured medical plan, (v) the Hunter Service Company, Inc. Employees’ Pension Plan, (w) the John Middleton, Inc. Supplemental Pension Plan, (x) the Company’s Profit Sharing Bonus practice, (y) Alcohol Tobacco Tax and Trade Bureau levies and (z) tobacco quota buyout assessments.

(b) Each of the following terms is defined in the Section set forth opposite such term:

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ARTICLE II

Purchase and Sale of Shares

Section 2.1. Purchase and Sale . On the basis of the representations, warranties, covenants and agreements and subject to the satisfaction or waiver (to the extent permitted) of the applicable conditions set forth herein, at the Closing, Seller shall sell, transfer, convey, assign and deliver to Buyer (or one or more of its permitted designees), and Buyer shall (or shall cause one or more of its permitted designees to) purchase, acquire and accept from Seller, free and clear of all Liens, the Shares which constitute, and will constitute as of the Closing, 100% of the issued and outstanding shares of capital stock or other equity interests in the Company. In payment for such Shares, simultaneously with the delivery by Seller of certificates for such Shares, with all appropriate stock powers and all requisite tax stamps attached, properly signed, in form suitable for the transfer of such Shares to Buyer (or one or more of its permitted designees), and the other deliveries required by Section 2.3 , and subject to the satisfaction or waiver (to the extent permitted) of the applicable conditions set forth herein, Buyer will wire transfer or cause to be wire transferred (i) the Purchase Price less the Escrow Amount, in immediately available funds to an account of Seller, which account shall be specified by Seller no later than two Business Days prior to the Closing Date and (ii) the Escrow Amount, in immediately available funds to the account specified by the Escrow Agent.

Section 2.2. Time and Place of Closing . The closing of the purchase and sale of the Shares (the “ Closing ”) shall take place (a) at 10:00 a.m., New York City time, at the offices of Wachtell, Lipton, Rosen & Katz, 51 West 52nd Street, New York, New York 10019, as promptly as practicable (but no later than the third Business Day) following the date on which the last to be satisfied or waived of the conditions set forth in Article VIII (other than those conditions that by their nature cannot be satisfied until the Closing Date, but subject to the satisfaction or, where permitted, waiver of those conditions) shall be satisfied or waived in accordance with this Agreement or (b) at such other place, time and/or date as Seller and Buyer shall agree (the date of the Closing, the “ Closing Date ”).

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Section 2.3. Deliveries by Seller . At the Closing, Seller shall deliver the following to Buyer:

(a) certificates representing the Shares, in each case with appropriate stock powers or other instruments of transfer and requisite tax stamps attached and properly signed;

(b) control over all Books and Records in the possession of Seller or any Continuing Affiliate that are required to be delivered on or before the Closing pursuant to the plan contemplated by Section 5.1(c) , except as otherwise provided by Law;

(c) the certificate required to be delivered by Seller pursuant to Section 8.2(d) ;

(d) a duly executed counterpart of the Escrow Agreement executed by Seller;

(e) a duly executed counterpart of the Non-Competition and Non-Solicitation Agreement, the form of which is attached as Exhibit A hereto, duly executed by the Seller and Shareholder;

(f) resignations, effective as of the Closing Date, of those directors of the Business Entities as Buyer may request;

(g) a certificate of Seller’s non-foreign status that complies with the requirements of Section 1445 of the Code and the Treasury Regulations promulgated thereunder; and

(h) such other documents, instruments and certificates as Buyer may reasonably request in connection with the transactions contemplated by this Agreement.

Section 2.4. Deliveries by Buyer . At the Closing, Buyer shall deliver the following to Seller:

(a) the Purchase Price less the Escrow Amount in immediately available funds;

(b) the certificate required to be delivered by Buyer pursuant to Section 8.3(c) ;

(c) a duly executed counterpart of the Escrow Agreement executed by Buyer;

(d) a duly executed counterpart of the Non-Competition and Non-Solicitation Agreement executed by Buyer; and

(e) such other documents, instruments and certificates as Seller may reasonably request in connection with the transactions contemplated by this Agreement.

Section 2.5. Escrow of Funds . At the Closing, Buyer shall in accordance with Section 2.1 , deliver or cause to be delivered to a bank or financial institution in the United States

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mutually acceptable to Buyer and Seller, as escrow agent (the “ Escrow Agent ”), One Hundred Forty-Five Million Dollars ($145,000,000) in cash (the “ Escrow Amount ”), by wire transfer of immediately available funds to be held by the Escrow Agent pursuant to an escrow agreement (the “ Escrow Agreement ”) in the form attached as Exhibit B hereto, with such changes as may be requested by the Escrow Agent to which Buyer and Seller may agree. The funds delivered to the Escrow Agent, together with any interest or other proceeds with respect thereto, shall be the “ Escrow Fund .” The Escrow Agent shall invest the Escrow Fund as set forth in the Escrow Agreement. The Escrow Fund shall be released from time to time upon the giving of a joint instruction(s) (the “ Joint Instruction ”) by Buyer and Seller and any remaining Escrow Funds shall be released on the first anniversary of the Closing Date, except as provided pursuant to the terms of the Escrow Agreement or as set forth on Schedule 2.5 to the Buyer Disclosure Letter. All costs and expenses relating to the Escrow Agreement, including the fees and expenses of the Escrow Agent, shall be borne equally by Buyer and Seller.

ARTICLE III

Representations and Warranties of Seller and the Company

Except as set forth in the corresponding schedule to the disclosure letter delivered to Buyer by Seller on or prior to the date hereof (the “ Seller Disclosure Letter ”) (it being agreed that disclosure of any item in any schedule to the Seller Disclosure Letter shall also be deemed disclosure with respect to any other Section of this Article III to which the relevance of such item is reasonably apparent; provided that no such disclosure shall be deemed to qualify or limit the representations and warranties of Seller and the Company set forth in Section 3.6(b) of this Agreement unless expressly set forth on Schedule 3.6(b) to the Seller Disclosure Letter), each of Seller and the Company hereby represents and warrants to Buyer as set forth in this Article III . Notwithstanding anything to the contrary in this Agreement, and for the avoidance of doubt, neither Seller nor the Company is making any representations or warranties in this Agreement with respect to (a) the existence of any product Liability arising from the research, development, manufacture, sale, advertising, distribution, consuming, marketing or use of cigars or pipe tobacco products or (b) that certain Master Settlement Agreement, dated as of November 23, 1998, among the 46 states and five United States territories listed on the signature pages thereto, the District of Columbia, Philip Morris Incorporated, R.J. Reynolds Tobacco Company, Brown & Williamson Tobacco Corporation and Lorillard Tobacco Company, as amended, supplemented or replaced (the “ MSA ”).

Section 3.1. Incorporation; Authorization; etc . (a) The name of each of the Business Entities is listed on Schedule 3.1(a) to the Seller Disclosure Letter. Each Business Entity is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization. Each of the Business Entities (i) has the requisite corporate power and authority to own its properties and assets and to carry on its business as it is now being conducted and (ii) is in good standing and is duly qualified to transact business in each other jurisdiction in which the nature of property owned or leased by it or the conduct of its business requires it to be so qualified, except where the failure to be in good standing or to be duly qualified to transact business would not, individually or in the aggregate, have or reasonably be expected to have a Business Material Adverse Effect. Seller is a corporation duly organized and validly existing under the laws of the State of Delaware.

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(b) Each of Seller and the Company has the requisite corporate power to execute and deliver this Agreement and to perform its obligations hereunder and to consummate the transactions contemplated hereby. The execution and delivery by Seller and the Company of this Agreement, the performance by Seller and the Company of their respective obligations hereunder and the consummation by Seller and the Company of the transactions contemplated hereby have been duly and validly authorized by the respective Boards of Directors of Seller and the Company, by the stockholders of Seller and by Seller in its capacity as sole stockholder of the Company, and no other corporate proceedings on the part of Seller or the Company, their respective Boards of Directors or stockholders are necessary therefor. This Agreement has been duly executed and delivered by Seller and the Company.

(c) Except as set forth on Schedule 3.1(c) to the Seller Disclosure Letter and, with respect to clauses (ii) and (iii), subject to obtaining the consents set forth thereon, the execution, delivery and performance by Seller and the Company of this Agreement will not (i) violate any provision of Seller’s or any Business Entity’s respective certificate of incorporation or by-laws (or equivalent organizational documents), (ii) violate in any material respect any provision of, or be an event that is (or with the passage of time will result in) a violation in any material respect by Seller or the Company of, or result in the acceleration of or entitle any party to accelerate or exercise (whether after the giving of notice or lapse of time or both) any material right or obligation of the Seller or any Business Entity, under, or result in the imposition of any Lien upon or the creation of a security interest in any of the Shares or any Business Entity’s assets or properties pursuant to, any material agreement, instrument, order, arbitration award, judgment or decree to which Seller or any Business Entity is a party or by which any of them is bound, or (iii) violate or conflict in any material respect with any Law to which Seller or any Business Entity is subject. Assuming the due execution of this Agreement by Buyer, this Agreement constitutes the legal, valid and binding obligations of Seller and the Company, enforceable against Seller and the Company in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally and to general principles of equity. At the Closing, the Escrow Agreement will be duly executed and delivered by Seller, and, assuming the due execution and delivery thereof by the other parties thereto, at the Closing the Escrow Agreement will constitute the legal, valid and binding obligations of Seller, enforceable against Seller in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally and to general principles of equity. Seller has provided to Buyer true and correct copies of the certificate of incorporation and by laws or similar organizational documents, each as amended to date, of each of the Business Entities.

(d) Since at least January 1, 1990, the Business Entities have not operated any business other than the Business.

Section 3.2. Capitalization; Structure . (a) The authorized capital stock of the Company consists of (i) 1,161 shares of Company Class A Common Stock, (ii) 1,161,000 shares of Company Class B Common Stock and (iii) 2,500 shares of Company First Preferred Stock. As of the date hereof, (x) 1000 shares of Company Class A Common Stock are outstanding (the

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“ Shares ”), which Shares are validly issued, fully paid and nonassessable, have been issued free of preemptive rights and are owned by Seller free and clear of all Liens, and (y) no shares of any other class of capital stock of the Company are outstanding. The Company has no Subsidiaries other than the other Business Entities. Schedule 3.2(a) to the Seller Disclosure Letter sets forth the name of each Subsidiary of the Company, its jurisdiction of incorporation or organization, the number of outstanding shares of its capital stock or other equity interests of each class and the name of and number of shares owned by each holder of any such shares of capital stock or other equity interests. All of the outstanding shares of capital stock or other equity interests of each Subsidiary of the Company have been validly issued, are fully paid and nonassessable and have been issued free of preemptive rights. Upon consummation of the Stock Purchase at the Closing as contemplated by this Agreement, Seller will deliver to Buyer good and valid title to all of the Shares, free and clear of all Liens.

(b) There are no outstanding options, warrants or other rights of any kind to acquire, or obligations to issue, shares of capital stock of any class of, or other equity interests in, any Business Entity. None of the Business Entities owns any material equity interest, directly or indirectly, in any Person other than the other Business Entities. There are no outstanding obligations of any Business Entity (i) to repurchase, redeem or otherwise acquire any shares of capital stock or other equity interests in any Business Entity or (ii) to grant preemptive or antidilutive rights with respect to any such shares or interests.

Section 3.3. Financial Statements; Books and Records . (a) Attached as Schedule 3.3(a) to the Seller Disclosure Letter are true and complete copies of the audited consolidated statements of income, balance sheets and statements of cash flows of the Company as of and for the fiscal years ended December 31, 2006, 2005 and 2004, and the unaudited consolidated statements of income and balance sheets of the Company as of and for the nine months ended September 30, 2007 and 2006 (collectively, the “ Business Financial Statements ”). The Business Financial Statements present fairly in all material respects the consolidated financial position and results of operations and cash flows of the Company for the respective periods or as of the respective dates set forth therein, in each case in accordance with U.S. GAAP applied on a consistent basis throughout the periods involved (except as otherwise indicated therein and except for, in the case of the unaudited Business Financial Statements, the absence of notes and schedules and changes resulting from normal year-end adjustments). The Business Financial Statements have been prepared from and in all material respects in accordance with the books and records of the Business Entities. The balance sheet as of December 31, 2006 included in the Business Financial Statements is referred to in this Agreement as the “ Business Balance Sheet .”

(b) The books and records of the Business Entities for the fiscal years ended December 31, 2006, 2005 and 2004 and for the period from December 31, 2006 through the date hereof have been maintained in all material respects in compliance with legal and accounting requirements applicable to such Business Entity.

Section 3.4. No Undisclosed Liabilities . Except as set forth on Schedule 3.4 to the Seller Disclosure Letter, none of the Business Entities has any Liabilities which are, individually or in the aggregate, material (and adverse), except for (a) Liabilities which are disclosed or reserved against in the Business Balance Sheet, (b) performance obligations under contracts (other than with respect to a breach or default) and (c) Liabilities incurred in the ordinary course of business since the date of the Business Balance Sheet.

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Section 3.5. Properties; Sufficiency . (a) With the exception of properties disposed of since December 31, 2006 in the ordinary course of business consistent with past practice, each Business Entity has good title to, or holds by valid and existing lease or license, free and clear of all Liens other than Permitted Liens, each piece of material real and personal property capitalized on or included in the Business Balance Sheet and each piece of material real and personal property acquired by any Business Entity since the date of the Business Balance Sheet that would, had it been acquired prior to such date, be capitalized on or included in the Business Balance Sheet. Schedule 3.5(a) to the Seller Disclosure Letter sets forth a list of all the real property owned or leased by any of the Business Entities (the “ Business Real Property ”) material to the Business. Prior to the date hereof, Seller has made available to Buyer correct and complete copies of all material leases and subleases (including all material amendments, modifications and side letters thereto, and all notices of default and other material notices thereunder) relating to the Business Real Property material to the Business to which any of the Business Entities is a party, and all such material leases and subleases are identified on Schedule 3.5(a) to the Seller Disclosure Letter, it being understood that for purposes of this sentence, “material” shall mean any lease or sublease with total future payments in excess of $1,000,000. There are no pending or, to Seller’s or the Company’s knowledge, threatened condemnation proceedings relating to any of the Business Real Property material to the Business. Except as disclosed on Schedule 3.5(a) to the Seller Disclosure Letter, none of the Business Real Property material to the Business or any properties owned or leased by Seller or any Continuing Affiliate is shared by any Business Entity, on the one hand, and Seller or a Continuing Affiliate, on the other hand.

(b) Immediately following the Closing, the Business Entities will own, lease or have a valid license to use all of the assets, properties and rights necessary to operate the Business as heretofore conducted and such assets, properties and rights are sufficient in all material respects to operate the Business in the manner heretofore operated, including all assets and properties reflected on the Business Balance Sheet and assets and properties acquired since the date of the Business Balance Sheet in the conduct of the Business (except for properties disposed of in the ordinary course of business since the date of the Business Balance Sheet). Except as set forth on Schedule 3.5(b) to the Seller Disclosure Letter, following the Closing neither Seller nor any Continuing Affiliate will have any ownership interest in or right to use any asset described in the preceding sentence.

Section 3.6. Absence of Certain Changes . Since December 31, 2006 through the date hereof, (a) except as set forth on Schedule 3.6(a) to the Seller Disclosure Letter, the Business Entities have conducted the Business in the ordinary course of business, (b) except as set forth on Schedule 3.6(b) to the Seller Disclosure Letter there has been no change or development in or effect on the Business that has had, or would reasonably be expected to have, a Business Material Adverse Effect and (c) except as set forth on Schedule 3.6(c) to the Seller Disclosure Letter, there has been no action taken by Seller or any Business Entity prior to the date hereof which, if taken from the date hereof through the Closing Date, would require the consent of Buyer under any of the provisions of subsection (i), (ii), (iii), (iv), (v), (vi), (ix) or (xiv) of Section 5.4 ; provided , that, solely for this purpose, each reference in clauses (v) and (vi) of Section 5.4 to $1 million and $2 million, respectively, shall be deemed to be a reference to $5 million and the proviso in Section 5.4(v)(B) shall be disregarded.

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Section 3.7. Litigation; Orders . Except as set forth on Schedule 3.7 to the Seller Disclosure Letter, there are no lawsuits, actions, administrative or arbitration or other proceedings or (to the knowledge of the Seller or the Company) governmental investigations pending or, to Seller’s or the Company’s knowledge, threatened against any Business Entity that, if determined adversely to the Business Entities, would, individually or in the aggregate, have or reasonably be expected to have a Business Material Adverse Effect or prevent or materially delay the consummation of the Stock Purchase. Except as set forth on Schedule 3.7 to the Seller Disclosure Letter, there are no material judgments or material outstanding orders, injunctions, decrees, stipulations or awards (whether rendered by a court or administrative agency, or by arbitration) against any Business Entity or any of their respective properties or businesses.

Section 3.8. Intellectual Property . The Business Entities own, or are validly licensed or otherwise have the right to use, all material Business Intellectual Property Rights necessary for the conduct of the Business. No Business Intellectual Property Right is subject to any outstanding judgment, injunction, order or decree restricting the use thereof by the Business Entities or restricting the licensing thereof by the Business Entities to any Person, or any agreement so restricting in any material respect the use or licensing thereof. To the knowledge of Seller and the Company, no Business Entity is infringing in any material respect on any other Person’s Intellectual Property Rights. To the knowledge of Seller and the Company, no Person is in infringing in any material respect on any Business Intellectual Property Rights. No Business Entity is a defendant in any action, suit, or proceeding relating to, or otherwise was notified of, any alleged material claim of infringement of any Business Intellectual Property Right, and the Business Entities have no outstanding material actions or suits for any continuing infringement by any other Person of any Business Intellectual Property Rights. Schedule 3.8 to the Seller Disclosure Letter sets forth a list of all United States and foreign patents and patent applications, invention disclosure, trademark registrations and applications therefor, registered copyrights and applications therefor included in the Business Intellectual Property Rights and trade names of any of the Business Entities that are material to the Business.

Section 3.9. Licenses, Approvals, Other Authorizations, Consents, Reports, etc . (a) Except as set forth on Schedule 3.9(a) to the Seller Disclosure Letter, the Business Entities possess or have been granted all licenses, permits, franchises, registrations and other authorizations of any Governmental Authority (“ Licenses ”) necessary to entitle them presently to conduct the Business in the manner in which it is presently being conducted, except those whose failure to possess or have been granted would not reasonably be expected to have a Business Material Adverse Effect. All Licenses possessed by or granted to any of the Business Entities and material to the Business are in all material respects in full force and effect. No proceeding is pending or, to Seller’s or the Company’s knowledge, threatened seeking the revocation or limitation of any such material License.

(b) Schedule 3.9(b) to the Seller Disclosure Letter contains a list of all registrations, filings, applications, notices, consents, approvals, orders, qualifications and waivers required to be made, filed, given or obtained by Seller, its Subsidiaries or any Business Entity with, to or from any Persons in connection with the consummation of the Stock Purchase and the other

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transactions required by this Agreement, except for those the failure of which to make, file, give or obtain would not, individually or in the aggregate, have or reasonably be expected to have a Business Material Adverse Effect or prevent or materially delay the consummation of the Stock Purchase.

Section 3.10. Labor Matters . None of the Business Entities is party to any agreement with any labor unions or associations representing employees of any of the Business Entities. No labor organization or group of employees of the Business Entities has a pending demand for recognition or certification, and there are no representation or certification proceedings or petitions seeking a representation proceeding presently pending or, to the knowledge of the Seller or the Company, threatened to be brought or filed, with the National Labor Relations Board or any other labor relations tribunal or authority. None of the Business Entities is involved in or, to Seller’s or the Company’s knowledge, threatened with any work stoppage, labor dispute, arbitration, lawsuit or administrative proceeding relating to labor matters involving the employees of any Business Entity (excluding routine workers’ compensation and unemployment compensation claims) that would, individually or in the aggregate, have or reasonably be expected to have a Business Material Adverse Effect. Each of the Business Entities is in compliance with all applicable Laws respecting employment and employment practices, terms and conditions of employment, wages and hours and occupational safety and health, except for any failure to be in compliance that would not individually or in the aggregate, have or reasonably be expected to have a Business Material Adverse Effect.

Section 3.11. Compliance with Laws . The conduct by the Business Entities of the Business complies in all material respects with all Laws applicable to the Business Entities, it being understood that nothing set forth in this Section 3.11 is intended to address compliance with any law that is the subject of any other representation or warranty set forth in Section 3.9 , 3.10 , 3.15 or 3.16 or in Article VII .

Section 3.12. Insurance . Schedule 3.12 to the Seller Disclosure Letter lists all material insurance policies relating to fire and casualty, liability and other forms of property and casualty insurance in effect as of the date hereof and all such historic occurrence based policies written in the last five years which cover any Business Entity or the Business Real Property to be transferred pursuant to Section 5.12 , together with a statement of policy number and coverage limits. All such insurance policies are in full force and effect (other than such historic occurrence based policies written in the last five years), are valid and enforceable, and all premiums due thereunder have been paid. In the last two (2) years, neither Seller nor any of its Subsidiaries (with respect to the Business) nor any Business Entity has received written notice of cancellation or termination, other than in connection with normal renewals, of any such insurance policy, and no claim is pending as of the date of this Agreement under any such insurance policy involving an amount in excess of $500,000.

Section 3.13. Material Contracts . As of the date hereof, except as set forth on Schedule 3.13 to the Seller Disclosure Letter, none of the Business Entities is a party to or bound by any (a) employment or consulting agreement with an individual requiring payments of base compensation in excess of $150,000 per year; (b) written agreement with a distributor with purchases from the Company of at least $1,000,000 in the last calendar year which is not terminable on one year’s (or less) notice; (c) joint venture or similar contract or agreement; (d) contract

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which is terminable by the other party or parties thereto upon a change of control of any of the Business Entities; (e) contract or agreement that materially limits the ability of any of the Business Entities or any Affiliates of a Business Entity to compete in any line of business or in any geographic area; (f) contract or agreement between or among one or more Business Entities on the one hand and Seller or any Continuing Affiliate or any officer or director of any of the Business Entities on the other hand; (g) note, mortgage, indenture and other obligation and agreement and other instrument for or relating to any lending or borrowing (including assumed or guaranteed debt) of $1,000,000 or more effected by any Business Entity or to which any properties or assets of any of the Business Entities are subject; or (h) other contract or agreement, entered into other than in the ordinary course of business, requiring total future payments in excess of $1,000,000 or which is otherwise material to the Business. The contracts required to be so listed on Schedule 3.13 to the Seller Disclosure Letter are referred to herein as “ Business Material Contracts .” With respect to all Business Material Contracts, (i) none of the Business Entities, Seller or any Continuing Affiliate, nor, except as set forth on Schedule 3.13 to the Seller Disclosure Letter, to Seller’s or the Company’s knowledge, any other party to any such Business Material Contract is in breach thereof or default thereunder, and (ii) there does not exist any event that, with the giving of notice or the lapse of time or both, would constitute such a breach or default by any Business Entity, Seller or any Continuing Affiliate, except for such breaches, defaults and events which in the case of clauses (i) and (ii) would not, individually or in the aggregate, have or reasonably be expected to have a Business Material Adverse Effect. Prior to the date hereof, Seller and the Company have made available to Buyer true and correct copies of all Business Material Contracts.

Section 3.14. Brokers, Finders, etc . Except for the services of the Seller Financial Advisor, no broker, finder or investment banker is entitled to any brokerage, finder’s or other similar fee, commission or expenses in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of Seller, any Continuing Affiliate or any Business Entity. Seller is solely responsible for such fees and expenses of the Seller Financial Advisor.

Section 3.15. Environmental Compliance . (a) Except as set forth on Schedule 3.15 to the Seller Disclosure Letter, each Business Entity has obtained all permits, licenses and other authorizations which are required with respect to the operation of the Business Entities as presently conducted under federal, state and local laws and regulations relating to pollution or protection of human health or the environment, including laws relating to emissions, discharges, releases or threatened releases or discharges of hazardous, toxic or other pollutants, contaminants, chemicals or industrial materials, including petroleum and petroleum-based products (hereinafter referred to as “ Hazardous Materials ”) into the environment (including, without limitation, ambient air, surface water, ground water, land surface or subsurface strata) or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials; provided , however , that any applicable product Liability laws governing the research, development, manufacture, sale, advertising, distribution, consuming, marketing or use of cigars or pipe tobacco products shall not be deemed to be an Environmental Law (the “ Environmental Laws ”), except where the failure to have obtained such permits, licenses and other authorizations would not, individually or in the aggregate, have or reasonably be expected to have a Business Material Adverse Effect.

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(b) Except as set forth on Schedule 3.15 to the Seller Disclosure Letter, each of the Business Entities is presently conducting its business in compliance with all terms and conditions of the permits, licenses and authorizations required by the Environmental Laws, and is in compliance with all other applicable limitations, restrictions, conditions, standards, prohibitions, requirements, obligations, schedules and timetables contained in the Environmental Laws or contained in any regulation, code, plan, order, decree, judgment, injunction, notice or demand letter issued, entered, promulgated or approved thereunder applicable to the Business Entities, except for such noncompliance which would not, individually or in the aggregate, have or reasonably be expected to have a Business Material Adverse Effect. There is no civil, criminal or administrative action, suit, written demand, notice of violation, investigation known to Seller or the Company, proceeding, written notice or demand letter pending relating to the Business Real Property or business of any Business Entity or, to the knowledge of Seller and the Company, threatened against the business or Business Real Property of any Business Entity under Environmental Laws or any code, plan, order, or decree, judgment, injunction, written notice or demand letter issued, entered, promulgated or approved thereunder applicable to the Business Entities, in each case that would, individually or in the aggregate, have or reasonably be expected to have a Business Material Adverse Effect.

(c) To the knowledge of Seller and the Company and except as set forth on Schedule 3.15 to the Seller Disclosure Letter, with regard to any of the Business Real Property, there are no past or present events, conditions, circumstances, or future events, conditions or circumstances as to which Seller or any of its Subsidiaries has written notice, which would interfere with or prevent, or would be reasonably likely to interfere with or prevent, any Business Entity, based on the operation of the Business as presently conducted, from complying in all material respects with Environmental Laws, or which otherwise would be reasonably likely to form the basis of any material claim, action, demand, proceeding or notice of violation, based on or related to the emission, discharge, release or threatened release into the environment of any Hazardous Material. Without in any way limiting the foregoing, except as would not, individually or in the aggregate, have or reasonably be expected to have a Business Material Adverse Effect and except as set forth on Schedule 3.15 to the Seller Disclosure Letter, none of the Business Entities nor, to the knowledge of the Seller or the Company, any other Person has buried, released, emitted, discharged, dumped or disposed of any Hazardous Materials into the environment in quantities that would give rise to material liability on the part of any Business Entity or require cleanup by any Business Entity under Environmental Laws based on the operation of the Business as presently conducted.

(d) Except as set forth on Schedule 3.15 to the Seller Disclosure Letter and except as would not, individually or in the aggregate, have or reasonably be expected to have a Business Material Adverse Effect, to the knowledge of Seller and the Company, no cleanup has occurred at any Business Real Property, which would result or reasonably be expected to result in the creation of a Lien on such property by any Governmental Authority with respect thereto, nor has any such assertion of a Lien been made by any Governmental Authority with respect thereto.

(e) Except as set forth on Schedule 3.15 to the Seller Disclosure Letter, and except as would not, individually or in the aggregate, have or reasonably be expected to have a Business Material Adverse Effect, (i) neither Seller nor any of its Subsidiaries (with respect to

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the Business) nor any of the Business Entities has received any written notice from any Governmental Authority or private or public entity or individual requesting information in connection with a possible violation of Environmental Laws or advising it that it is in non-compliance with applicable Environmental Laws, or responsible for, or potentially responsible for, costs with respect to a release, a threatened release or clean-up of Hazardous Materials generated, stored, treated, disposed of or transported by any Business Entity, and (ii) no Business Entity has entered into any agreement for the clean-up of any Hazardous Materials.

(f) Except as set forth on Schedule 3.15 to the Seller Disclosure Letter, to the knowledge of Seller and the Company, none of the Business Real Property material to the Business includes any equipment, machinery, device, or other apparatus that contains polychlorinated biphenyls that is now or ever has been leaking in any material respect that requires removal or remediation based on continued operation of the Business Entities as presently conducted; any asbestos or asbestos-containing material that requires removal, remediation or abatement based on continued operation of the Business Entities as presently conducted; any “waters of the United States” determined by Seller, any of its Subsidiaries or any Governmental Authority to be subject to any legal requirement or restriction under Environmental Laws related to wetlands, wetlands buffer, stream buffer or transition areas or open waters; or any underground storage tank, unregistered above ground storage tank, surface impoundment, septic tank, pit, swamp or lagoon in which Hazardous Materials are being or have been treated, stored, or disposed of in violation of applicable Environmental Laws, in each case that would give rise to any material liability on the part of any Business Entity.

Section 3.16. Employee Benefit Plans . (a)  Schedule 3.16(a) to the Seller Disclosure Letter contains a list (under appropriate headings) of each material Employee Plan and Business Material Employment Arrangement and designates each of which is an Employee Plan, Company Plan, Seller Plan (as defined in Section 6.1(g) ) and Business Material Employment Arrangement. With respect to each material Employee Plan and Business Material Employment Arrangement, Seller has delivered or made available to Buyer a true, correct and complete copy of: (i) each such Employee Plan or Business Material Employment Arrangement document (or a summary of any unwritten Employee Plan or Business Material Employment Arrangement), trust agreement and insurance contract or other funding vehicle; (ii) the most recent Annual Report (Form 5500 Series) and accompanying schedule, if any; (iii) the current summary plan description and any material modifications thereto, if any (in each case, whether or not required to be furnished under ERISA); (iv) the most recent annual financial report, if any; (v) the most recent actuarial report, if any; and (vi) the most recent determination letter from the Internal Revenue Service (“ IRS ”), if any. Neither the Company nor any ERISA Affiliate of the Company has any commitment or obligation to establish or adopt any, or enter into any, new or additional Employee Plans or Business Material Employment Agreement or to increase the benefits under any existing Employee Plan, other than the Severance Plan (as defined in Section 6.1(e) ) and the bonus and retention arrangement (as described on Schedule 5.4(viii) to the Seller Disclosure Letter) (“ Bonus Plan ”).

(b) Except as set forth on Schedule 3.16(b) to the Seller Disclosure Letter, none of the Business Entities, any predecessor of any of the Business Entities sponsors or any of their ERISA Affiliates, maintains or contributes to, or has in the past six years sponsored, maintained or contributed to, any Plan subject to Title IV of ERISA or Section 412 of the Code (a

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“ Title IV Plan ”). No Company Plan is a Title IV Plan. With respect to any Title IV Plan, (i) there does not exist any accumulated funding deficiency within the meaning of Section 412 of the Code or Section 302 of ERISA, whether or not waived; (ii) the fair market value of the assets of such Title IV Plan equals or exceeds the actuarial present value of all accrued benefits under such Title IV Plan (whether or not vested) on an accumulated benefits obligation basis (consistent with FAS No. 35 as amended) based on the most recent actuarial report for each such plan; and (iii) no reportable event within the meaning of Section 4043(c) of ERISA for which the 30-day notice requirement has not been waived has occurred, and the consummation of the Stock Purchase will not result in the occurrence of any such reportable event. Except as set forth on Schedule 3.16(b) , no Controlled Group Liability has been incurred by any Business Entity nor do any circumstances exist that could reasonably be expected to result in Controlled Group Liability for any of the Business Entities following the Closing by reason of such Business Entities having been an ERISA Affiliate of Seller (or of any other ERISA Affiliate of Seller) prior to the Closing. For purposes of this Agreement, “ Controlled Group Liability ” means any and all liabilities (i) under Section 302(f) or Title IV of ERISA, (ii) under Sections 412(n) or 4971 of the Code and (iv) for a material violation of the continuation coverage requirements of Section 601 et seq. of ERISA and Section 4980B of the Code or the group health requirements of Sections 9801 et seq. of the Code and Sections 701 et seq. of ERISA.

(c) None of the Company, any predecessor of any of the Business Entities nor any of their ERISA Affiliates contributes to or is obligated to contribute to, or has in the past six years contributed to, or has been obligated to contribute to, any multiemployer plan, as defined in Section 3(37) of ERISA (each, a “ Multiemployer Plan ”) and no Employee Plan is a Multiemployer Plan. None of the Business Entities or any of their ERISA Affiliates has incurred any liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as those terms are defined in Part I of Subtitle E of Title IV of ERISA, that has not been satisfied in full. With respect to each such Multiemployer Plan, none of the Business Entities has received any written notification, nor, to the knowledge of Seller and the Company, has any reason to believe, that any such Multiemployer Plan is in reorganization, has been terminated, is insolvent, or may reasonably be expected to be in reorganization, to be insolvent, or to be terminated.

(d) Except as set forth on Schedule 3.16(d) to the Seller Disclosure Letter, each Employee Plan which is intended to be qualified under Section 401(a) of the Code has received the most recently available favorable determination letter (under the “GUST” or “EGTRAA” round of filings), or has pending an application for such determination from the IRS, and Seller and the Company have no knowledge as to why any such determination letter should be revoked or not be reissued. The Seller shall take, or shall cause its Subsidiaries to take, all reasonably actions to preserve the qualification of each Employee Plan, which has heretofore been intended to be qualified under Section 401(a) of the Code, with Section 401(a) of the Code. No Employee Plan or related funding vehicle from which the Employee Plan benefits are paid is intended to meet the requirements of Section 501(c)(9) of the Code. Each Employee Plan and each Employment Agreement has been maintained in compliance in all material respects with its terms and with the requirements prescribed by all statutes, orders, rules and regulations, including ERISA and the Code, which are applicable to such Employee Plan or Employment Agreement. All contributions required to be made to any Employee Plan by applicable Law or by any plan document or other contractual undertaking, and all premiums due or payable with

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respect to insurance policies funding any Employee Plan, have been timely made or accrued in accordance with U.S. GAAP and applicable U.S. Department of Labor Regulations or if there has been any failure to make such contribution, such failure or failures shall not, individually or in the aggregate, have or reasonably be expected to have a Business Material Adverse Effect. No events have occurred with respect to any Employee Plan that would reasonably be expected to result in payment or assessment by or against any Business Entity of any material excise taxes under Sections 4972, 4975, 4976, 4977, 4979, 4980B, 4980D, 4980E, 4980F or 5000 of the Code. There are no pending or, to the knowledge of Seller and the Company, threatened claims (other than claims for benefits in the ordinary course), lawsuits, investigations, audits or arbitrations which have been asserted or instituted against any one or more of the Employee Plans, any, to the knowledge of Seller and the Company, fiduciaries thereof with respect to their duties to the Employee Plans or the assets of any of the trusts under any of the Employee Plans, which would reasonably be expected to result in any material liability of any Business Entity to the PBGC, the U.S. Department of the Treasury, the U.S. Department of Labor, any Employee Plan, any participant in an Employee Plan or any other party.

(e) Schedule 3.16(e) to the Seller Disclosure Letter sets forth a complete list of all material funded and material unfunded non-qualified deferred compensation arrangements payable now or in the future to each current and former employee or director of any Business Entity, or any other Person with respect to which any Business Entity has any current liability or may have Liability prior to or immediately following the consummation of the Stock Purchase (collectively, the “ Deferred Compensation Arrangements ”), which schedule shall include the name and title or position of each such Person, the amount payable to such Person, the payment terms applicable thereto, and whether funded or unfunded and, if funded, a brief description of such funding. The Liability associated with each Deferred Compensation Arrangement has been properly accrued and accounted for on the Business Financial Statements. Each Employee Plan is either exempt from or has been operated and maintained in good faith compliance with Section 409A of the Code. Each Deferred Compensation Arrangement that is subject to Section 409A of the Code has been amended to comply with Section 409A of the Code to the extent required by applicable guidance from the U.S. Department of Treasury and Internal Revenue Service to avoid taxes under Section 409A of the Code presently and in the future (based on the law in effect and guidance provided on or before the date hereof), after taking into account any extension to make any required amendments to comply with Code Section 409A and applicable regulations. No Business Entity has any Liability for, or obligation to, indemnify any Person with respect to any Liability that has been or may be imposed on such Person under Sections 409A or 280G of the Code.

(f) Except as set forth on Schedule 3.16(f) to the Seller Disclosure Letter or in the Severance Plan or Bonus Plan, no Business Entity has any current or projected material Liability in respect of post employment or post retirement health, medical, life insurance or other welfare benefits for retired, former or current employees and/or directors of any Business Entity except as otherwise required by Law.

(g) There are no Employee Plans that are subject to the Laws of any jurisdiction outside of the United States.

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(h) Seller has made available to Buyer a true and complete list, as of October 31, 2007, of each Business Key Person, his or her current rate of annual base salary or current wages, 2007 bonus target, job title, employment status, work location and credited service date, fiscal year 2006 bonus, fiscal year 2005 bonus and date of hire. No Business Key Person has given notice to terminate employment. Upon request, Seller shall make available to the Buyer information concerning other employees of the Business Entities other than Business Key Persons that is comparable to the information described above with respect to Business Key Persons.

(i) Schedule 3.16(i) to the Seller Disclosure Letter sets forth a true, correct and complete list of each Employee Plan under which the execution and delivery of this Agreement, the Stock Purchase or actions or transactions required by the Agreement will result in, cause the accelerated vesting, funding or delivery of, or materially increase the amount or value of, any payment or benefit (including the forgiveness of indebtedness) to any employee, officer, Individual Consultant or director of any Business Entity, or could limit the right of any Business Entity to amend, merge, terminate or receive a reversion of assets from any Employee Plan or related trust or any Business Material Employment Arrangement or related trust.

Section 3.17. Non-Reliance . Seller acknowledges that the representations and warranties set forth in Article IV , and the representations and warranties of Buyer set forth in Article 13 of the Escrow Agreement and the Non-Competition and Non-Solicitation Agreement constitute the sole and exclusive representations and warranties of Buyer to Seller in connection with the transactions contemplated hereby, and Seller acknowledges and agrees that Buyer is not making any representation or warranty whatsoever, express or implied, beyond those expressly given in this Agreement, the Escrow Agreement or the Non-Competition and Non-Solicitation Agreement. Seller further acknowledges and agrees that (a) except and solely to the extent of the representations and warranties in Article IV , Buyer has made no representation or warranty either express or implied as to the accuracy or completeness of any information regarding Buyer and its Affiliates furnished or made available to Seller, the Company and/or their respective representatives, and (b) except with respect to the representations and warranties in Article IV , Seller shall have no claim or right to indemnification pursuant to Articles VII or IX with respect to any information, documents or materials furnished by Buyer, any of its Affiliates or any of its representatives to Seller or the Company in any materials or information furnished in connection with the transactions contemplated hereby. Notwithstanding the foregoing provisions of this Section 3.17 , nothing herein is intended to or shall limit or otherwise restrict any claim by or right of Seller with respect to or arising from any intentional misrepresentation or fraud.

ARTICLE IV

Representations and Warranties of Buyer

Except as set forth in the corresponding schedule to the disclosure letter delivered to Seller by Buyer on or prior to the date hereof (the “ Buyer Disclosure Letter ”) (it being agreed that disclosure of any item in any schedule to the Buyer Disclosure Letter shall also be deemed disclosure with respect to any other Section of this Article IV to which the relevance of such item is reasonably apparent), Buyer hereby represents and warrants to Seller as set forth in this Article IV :

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Section 4.1. Incorporation; Authorization; etc . (a) Buyer is a corporation duly organized and validly existing under the laws of the Commonwealth of Virginia. Buyer (i) has the requisite corporate power and authority to own its properties and assets and to carry on its business as it is now being conducted and (ii) is in good standing and is duly qualified to transact business in each other jurisdiction in which the nature of property owned or leased by it or the conduct of its business requires it to be so qualified, except where the failure to be in good standing or to be duly qualified to transact business would not, individually or in the aggregate, have or reasonably be expected to have a material adverse effect on the ability of Buyer to consummate the Stock Purchase or would otherwise prevent the performance of the obligations of Buyer under this Agreement (a “ Buyer Material Adverse Effect ”).

(b) Buyer has the requisite corporate power to execute and deliver this Agreement and to perform its obligations hereunder and to consummate the transactions contemplated hereby. The execution and delivery by Buyer of this Agreement, the performance by Buyer of its obligations hereunder and the consummation by Buyer of the transactions contemplated hereby have been duly and validly authorized by the Board of Directors of Buyer, and no other corporate proceedings on the part of Buyer, its Board of Directors or stockholder(s) are necessary therefor. This Agreement has been duly executed and delivered by Buyer.

(c) The execution, delivery and performance of this Agreement will not (i) violate any provision of Buyer’s certificate of incorporation or by-laws, (ii) violate any provision of, or be an event that is (or with the passage of time will result in) a violation of, or result in the acceleration of or entitle any party to accelerate or exercise (whether after the giving of notice or lapse of time or both) any obligation or right under, or result in the imposition of any Lien upon or the creation of a security interest in any shares of capital stock of Buyer or its Subsidiaries or any of Buyer’s assets or properties pursuant to, any agreement, instrument, order, arbitration award, judgment or decree to which Buyer or any of its Subsidiaries is a party or by which any of them is bound, or (iii) violate or conflict with any other restriction of any kind or character to which Buyer or any of its Subsidiaries is subject, that, in the case of clauses (ii) or (iii) would, individually or in the aggregate, reasonably be expected to have a Buyer Material Adverse Effect. Assuming the due execution of this Agreement by Seller and the Company, this Agreement constitutes the legal, valid and binding obligations of Buyer, enforceable against Buyer in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally and to general principles of equity. At the Closing, the Escrow Agreement will be duly executed and delivered by Buyer and, assuming the due execution and delivery thereof by the other parties thereto, at the Closing the Escrow Agreement will constitute the legal, valid and binding obligations of Buyer, enforceable against Buyer in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally and to general principles of equity.

Section 4.2. Licenses, Approvals, Other Authorizations, Consents, Reports, etc. Schedule 4.2 to the Buyer Disclosure Letter contains a list of all registrations, filings, applications, notices, consents, approvals, orders, qualifications and waivers required to be made, filed,

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given or obtained by Buyer or any of its Affiliates with, to or from any Person in connection with the consummation of the Stock Purchase and of the other obligations of Buyer under this Agreement except for those the failure to make, file, give or obtain which would not, individually or in the aggregate, have or reasonably be expected to have a Buyer Material Adverse Effect.

Section 4.3. Brokers, Finders, etc . Except for the services of the Buyer Financial Advisor, no broker, finder or investment banker is entitled to any brokerage, finder’s or other similar fee, commission or expenses in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of Buyer. Buyer is solely responsible for such fees and expenses of the Buyer Financial Advisor.

Section 4.4. Acquisition of Shares for Investment . Buyer is acquiring the Shares for investment and not with a view to, or for sale in connection with, any distribution thereof. Buyer acknowledges that the Shares are not registered under the Securities Act or any applicable state securities Laws, and that such Shares may not be transferred or sold except pursuant to the registration provisions of the Securities Act and applicable state securities laws or pursuant to an applicable exemption therefrom. Buyer (either alone or together with its advisors) has sufficient knowledge and experience in financial and business matters so as to be capable of evaluating the merits and risks of its investment in the Shares and is capable of bearing the economic risks of such investment.

Section 4.5. Financial Capability . Buyer has, and as of the Closing Date will have, sufficient cash on hand and/or cash available to it to pay the Purchase Price and otherwise consummate the Stock Purchase.

Section 4.6. Non-Reliance . Buyer acknowledges that the representations and warranties set forth in Article III and Article VII, and the representations and warranties of Seller set forth in Article 13 of the Escrow Agreement and in Article 2 of the Non-Competition and Non-Solicitation Agreement. constitute the sole and exclusive representations and warranties of Seller and the Company to Buyer in connection with the transactions contemplated hereby, and Buyer acknowledges and agrees that Seller and the Company are not making any representation or warranty whatsoever, express or implied, beyond those expressly given in this Agreement, the Escrow Agreement or the Non-Competition and Non-Solicitation Agreement, including any implied warranty as to condition, merchantability, or suitability as to any of the assets of the Business. Buyer further acknowledges and agrees that any estimates, budgets, projections, forecasts or other predictions that may have been provided to Buyer or any of its representatives are not representations or warranties of Seller and the Company or guarantees of performance and that actual results may vary substantially from any such estimates, budgets, projections, forecasts or other predictions. Buyer further acknowledges and agrees that (a) except and solely to the extent of the representations and warranties in Article III and Article VII , Seller and the Company have made no representation or warranty either express or implied as to the accuracy or completeness of any information regarding the Business Entities and the Business furnished or made available to Buyer and/or its representatives, and (b) except with respect to the representations