Reynolds American Inc. Outside Directors’ Compensation Summary

Board Retainer fee of $57,000 per year.

Lead Director Retainer fee of $20,000 per year.

Chairperson Retainer fees of $20,000 per year for the audit committee chair, $10,000 per year for the compensation committee chair, and $10,000 per year for the corporate governance and nominating committee chair.

Committee Meeting Attendance fees per meeting of $1,500 for audit committee, $1,350 for compensation committee, $1,250 for corporate governance and nominating committee, and $1,250 for any special committee meeting.

Board Meeting Attendance fees of $1,250 per meeting.

Summary

This agreement outlines the compensation and benefits for outside directors of Reynolds American Inc. Outside directors receive annual retainer fees, meeting attendance fees, and may defer payments in cash or stock units. They are also granted deferred stock units or shares, and receive various insurance coverages, including life, excess liability, and travel accident insurance. Additional benefits include matching grants for charitable contributions and reimbursement for director education programs. Directors are reimbursed for expenses related to board and education meetings. The agreement specifies conditions for deferral elections and insurance eligibility.

EX-10.1 2 g98658exv10w1.htm OUTSIDE DIRECTOR COMPENSATION SUMMARY exv10w1

Exhibit 10.1

REYNOLDS AMERICAN INC.
OUTSIDE DIRECTORS’ COMPENSATION SUMMARY

1. Fees/Expense Reimbursement

	•		All fees payable quarterly in arrears, but may be deferred in 25% increments in cash and/or in deferred stock units until termination of active directorship or until a selected year in the future.

	•		To be tax effective, an irrevocable deferral election must be made in the year prior to the year fees would otherwise be payable.

	•		Expenses: Directors are reimbursed for actual expenses incurred in connection with attendance at Board meetings, including transportation and lodging expenses.

2. Deferred Stock Units

	•		Upon election to the Board, an Outside Director receives an initial grant of 3,500 deferred stock units or, at the director’s election, 3,500 shares of RAI common stock.

	•		Annual grant of 1,000 deferred stock units, immediately vested; granted annually at the time of the Annual Meeting; Director can elect to receive non-deferred award of 1,000 shares of RAI common stock in lieu of deferred stock units.

	•		Quarterly grant of deferred stock units on the last day of each calendar quarter. Number of deferred stock units equal to $10,000 divided by the average of the closing price of a share of RAI common stock (as reported on the NYSE) for each business day during the last month of such calendar quarter.

	•		Initial and annual deferred stock units paid in cash or RAI common stock, and quarterly deferred units paid in cash only, following termination of active directorship per Director’s election in either a lump sum or in up to ten annual installments.

3. Life Insurance

•

Option to receive up to $100,000 non-contributory coverage while an active Director. Imputed income will be calculated based on your end-of-year age and coverage amount.

4. Excess Liability Insurance

•

Eligible to receive $10,000,000 in Excess Liability coverage. No cash payment required; the fair market value will be imputed income to you each year. Policy requires that you have at least $300,000 underlying liability limit under your Homeowner’s or other personal liability policy. Obligated to pay for claims up to $300,000 not covered by this policy.

5. Business Travel Accident Insurance

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$500,000 non-contributory coverage while an active Director.

6. Matching Grants

•

1:1 for Educational/Arts/Cultural/Charitable Organizations – combined $10,000 maximum.

7. Director Education Programs

	•		Directors may attend one outside director education program per year at RAI’s expense.

	•		Directors are reimbursed for actual expenses incurred in connection with attendance at director education programs, including transportation and lodging expenses.