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Vector Group Ltd. Completes Sale of Senior Convertible Notes 

Vector Group Ltd. (NYSE: VGR) announced today that it has completed the sale of $50 million aggregate principal amount of its 6.75% Variable Interest Senior Convertible Notes due 2014 (the "Notes") to Frost Nevada Investments Trust in a private placement. The purchase price consisted of $38.225 million in cash and $11.005 million aggregate principal amount of the Company's 5.0% Variable Interest Senior Convertible Notes due 2011, valued at 107% of principal amount. Frost Nevada Investments Trust is affiliated with Dr. Phillip Frost, who, prior to the consummation of the sale, may have been deemed to beneficially own approximately 8.1% of the common stock of the Company. Following consummation of the sale, Dr. Frost may be deemed to beneficially own approximately 11.5% of the common stock of the Company. The Company intends to use the net proceeds of the issuance for general corporate purposes.

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