SHARE REPURCHASE AGREEMENT

Exhibit 10.1

EXECUTION COPY

SHARE REPURCHASE AGREEMENT

THIS SHARE REPURCHASE AGREEMENT (this “Agreement”) is entered into on July 25, 2016, by REYNOLDS AMERICAN INC. (the “Company”), BROWN & WILLIAMSON HOLDINGS, INC. (“B&W”) and LOUISVILLE SECURITIES LIMITED, a U.K. corporation (“LSL”).

RECITALS

IN CONSIDERATION OF the mutual promises contained in this Agreement, the parties hereto hereby agree:

(i) a “Buyback Week” means a Calendar Week (as defined below) during which the Company repurchases any Shares pursuant to the Share Repurchase Program from any Person other than a member of the BAT Group;

(ii) a “Calculation Period” means a period that begins on the day immediately after the end of the preceding Calculation Period (or in the case of the first Calculation Period, on the first day of the month that includes the date of this Agreement) and ends on the earlier of (i) the next Friday that is the last day of a Buyback Week or (ii) the next Friday that is the last Friday of a calendar month;

(iii) “Calendar Week” means each seven-day period ending on a Friday;

(iv) “Excluded Compensation Buyback” means a buyback of Shares by the Company designated by the Company in a notice to B&W as being made pursuant to Section 2.04(d) of the Governance Agreement;

(v) the “BAT Seller” means LSL or, if LSL provides notice to the Company no later than the first business day after the BAT Group Buyback Number (as defined below) has been determined, one or more members of the BAT Group, which may include LSL, as designated in such notice; and

(vi) for purposes of the provisions of this Agreement relating to the BAT Group’s participation in the Share Repurchase Program (including, for example, the definition of “Buyback Week” and the calculation of the BAT Group Buyback Number as defined below), any Excluded Compensation Buyback shall be treated as not made pursuant to the Share Repurchase Program (and the BAT Group will not participate in any Excluded Compensation Buyback).

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(i) the number of Shares such that, after the purchase of such Shares from the BAT Group by the Company, the net total number of Shares sold by the BAT Group to the Company under this Agreement shall be equal to the total number of Shares purchased by the Company from shareholders other than members of the BAT Group (and other than Excluded Compensation Buybacks) for all periods through such Buyback Week pursuant to the Share Repurchase Program multiplied by the ratio of (x) the BAT Group’s percentage ownership of the equity of the Company on the date of this Agreement, to (y) 1.0 minus the BAT Group’s percentage ownership of the equity of the Company on the date of this Agreement;

(ii) the maximum number of Shares that the BAT Group can sell to the Company without decreasing the BAT Group’s percentage ownership of the equity of the Company from the date of this Agreement to the end of such Buyback Week; and

(iii) the maximum number of Shares, reasonably determined by LSL upon advice of its outside tax counsel after consultation with the Company, that the BAT Group can sell to the Company without putting at risk the Intended Tax Treatment.

If there is a change in the BAT Group’s Percentage Interest after the date of this Agreement that does not occur as part of the same plan as the purchases under the Share Repurchase Program or this Agreement, then (a) Paragraph A.5(i) shall be modified so as to apply separately on a cumulative basis for periods before and after such change in Percentage Interest, (b) the base BAT Group percentage ownership in Paragraph A.5(ii) shall be adjusted to reflect any acquisitions or dispositions of Shares by the BAT Group causing such change in Percentage Interest, (c) LSL or B&W, as applicable, shall promptly notify the other party concerning any such change within its control, and (d) any such change shall be effective for purposes of Paragraphs A.5(i) and A.5(ii) at the beginning of the Calculation Period following the Calculation Period in which the change occurs.

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(i) any Sale (as defined below) of Shares to the Company under this Agreement with respect to any Buyback Week (current or prior) shall be treated as having occurred or as occurring on the last day of such Buyback Week,

(ii) unless reasonably determined otherwise by LSL after consultation by B&W with the Company, such calculation shall take into account any increase or decrease in the outstanding equity of the Company since the date of this Agreement for any reason, and

(iii) LSL shall be entitled, after prior consultation by B&W with the Company, to reduce the number of Shares otherwise determined under Paragraph A.5(ii) so as to assure LSL that the BAT Group’s percentage ownership of the equity of the Company will not decrease as a result of future events that may reasonably be expected to occur in the future, including, without limitation, issuances of new equity by the Company pursuant to the exercise of stock options or the vesting of performance shares, the issuance or vesting of restricted stock, or the issuance of any other equity to any third party reasonably expected to occur after the end of the applicable Buyback Week. Without limiting the generality of the foregoing, for purposes of Paragraph A.5(ii), (i) LSL will take into account, in considering possible future issuances of Shares by the Company, the Company’s obligation pursuant to Section 2.04(d) of the Governance Agreement to make Excluded Compensation Buybacks, and (ii) the BAT Group’s percentage ownership in the Company at any time shall be determined by treating as not outstanding the number of Shares with respect to which the Company then has an outstanding obligation to make Excluded Compensation Buybacks.

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The parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in any Federal court located in the State of Delaware or in the Chancery Court of the State of Delaware, this being in addition to any other remedy to which they are entitled at law or in equity. In addition, each of the parties (a) consents to submit itself to the personal jurisdiction of any Federal court located in the State of Delaware or Chancery Court of the State of Delaware in the event any dispute arises out of this Agreement, (b) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court, (c) irrevocably and unconditionally waives (and agrees not to plead or claim) any objection to the laying of venue in Delaware of any action, suit or proceeding arising out of this Agreement, (d) agrees that it will not bring any action relating to this Agreement in any court other than any Federal court sitting in the State of Delaware or Chancery Court of the State of Delaware, (e) waives any right to trial by jury with respect to any action related to or arising out of this Agreement, and (f) agrees that this Agreement involves at least $100,000 and has been entered into by the parties in express reliance upon 6 Del. C. § 2708. Without limiting the agreement of the parties set forth in this Paragraph H, in the event that any dispute arising under this Agreement is subject to, or adjudicated by, the courts of the State of North Carolina, the parties agree that any such dispute will be adjudicated by the North Carolina Business Court (with any references in this Paragraph H to Delaware courts being deemed to be references to North Carolina courts and any references in this Paragraph H to the Chancery Court of the State of Delaware being deemed to be references to the North Carolina Business Court).

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(ii) If the Company properly delivers a Purchase Certificate, then the BAT Seller will be obligated to sell, and the Company shall be obligated to buy, a number of Shares equal to such Repurchase Number for such Repurchase Price at or before 12:00 p.m. Eastern Time on the second business day after the determination of the Repurchase Number and Repurchase Price in accordance with Paragraph L.2(i) above.

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(ii) Without limiting the generality of Paragraph L.2(i), either LSL or the Company may invoke the procedures of that Paragraph immediately following the end of the Share Repurchase Program, to the extent that the number of Shares that have been purchased from the BAT Group has been reduced on account of Paragraphs A.5(ii) and A.6(iii). If such procedures are invoked by the Company at such time, LSL shall reasonably consider, after consultation by B&W with the Company, the extent to which the prior reduction in sales of Shares to the Company pursuant to Paragraph A.6(iii) is still appropriate in order to not put the results in Paragraph A.5 at risk, based on all the facts and circumstances existing at that time. To the extent that LSL determines that the sale of an additional number of Shares to the Company at that time, in order to offset all or part of the prior reduction in sales as a result of Paragraph A.6(iii), is consistent with Paragraphs A.5, then LSL shall accept a Modification Certificate from the Company providing an Additional Number equal to such additional number.

(iii) If either the Company or LSL properly delivers a Modification Certificate, then, subject to Paragraphs L.3(i) and (ii), the BAT Seller will be obligated to sell, and the Company shall be obligated to buy, a number of Shares equal to such Additional Number for such Modification Repurchase Price at or before 12:00 p.m. Eastern Time on the second business day after such determination of the Additional Number, if any, and Modification Repurchase Price in accordance with Paragraphs L.3(i) and (ii) above.

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if to B&W, to

Andrew Panaccione

Corporate Secretary

Email:  ***@***

with copies to:

L. Brent Cotton

President

Louisville Corporate Services, Inc.

Email:  ***@***

Philip Gelston

Cravath, Swaine & Moore LLP

Email:  ***@***

if to LSL, to:

Steve Dale

Director

Email:  ***@***

with copies to:

Philip Gelston

Cravath, Swaine & Moore LLP

Email:  ***@***

if to the Company, to

Martin L. Holton III

General Counsel

Email:  ***@***

with a copy to:

Randi C. Lesnick

Jones Day

Email:  ***@***

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the day and year first above written.

[Signature Page to the Share Repurchase Agreement]

EXHIBIT A¹

REYNOLDS AMERICAN INC. CALCULATION CERTIFICATE

Date:                     

Calculation Period: beginning date                      ending date                     

Proposed BAT Group Buyback Number:                     

Note: Unless otherwise indicated, all statements of outstanding shares, shares issued, shares acquired, percentage interest, etc. are to be based on the meaning of those terms as defined in the Share Repurchase Agreement and will be calculated in accordance with the Share Repurchase Agreement.

Part A: Schedules

The following schedules are attached hereto (as applicable).

Schedule 1: General information and calculation of BAT Group Buyback Number.

Schedule 2: Schedule of all outstanding restricted stock, employee stock options, performance shares and other deferred issuances of shares as compensation, including grant, vesting, expiration and issuance dates, all as of the end of the Calculation Period.

Schedule 3: Details of purchases made under the Program from parties other than the BAT Group during the Calculation Period, including Excluded Compensation Buybacks.

Part B: Assumptions and Additional Information

Part C: Representations

The Company represents that, except as otherwise expressly noted below or elsewhere in this Exhibit A, (i) the Board of Directors of the Company has not been informed of and has not publicly announced or approved any intent, plan or arrangement directly or indirectly to issue or acquire any of its equity, other than the purchase of Shares pursuant to the Share Repurchase Program (including Excluded Compensation Buybacks) or pursuant to employee stock option or restricted stock plans, (ii) previously issued Calculation Certificates remain true, correct and complete as of their dates of issuance, (iii) if the Calculation Period includes a Buyback Week, it will have sufficient earnings and profits to permit the entire purchase price of all the Shares to be purchased pursuant to this Certificate to be treated as a dividend within the meaning of Section 316 of the Code, (iv) it does not have a Rabbi Trust or a similar arrangement holding shares, and (v) if the BAT Seller is LSL, it will withhold on the proceeds of the Sale paid to LSL at a rate of 5% of the gross purchase price for Shares otherwise payable to LSL and it has no reason to believe that such withholding rate is incorrect.

Exceptions:

The undersigned hereby certifies on behalf of Reynolds American Inc. that the statements contained herein and on schedules attached hereto are true, correct and complete.

EXHIBIT B²

LSL NOTICE

Date:                     

Attn: Steven Holland

Sent by email to:  ***@***

Calculation Period ending:                     

Date of Calculation Certificate                     

                     We agree with the BAT Group Buyback Number stated in such Calculation Certificate

                     We DO NOT agree with the BAT Group Buyback Number stated in such Calculation Certificate.

BAT Group Buyback Number proposed by LSL:

[Explanation]

BAT Seller, if other than LSL:                     

SCHEDULE 1 TO CALCULATION CERTIFICATE

Start date of calculation period:

End date of calculation period:

Includes buyback week (Y/N):

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The parties acknowledge that certain adjustments will be required if any buyback for a period is not completed by the end of the immediately following period.

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