8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported) November 30, 2007

Reynolds American Inc.

(Exact Name of Registrant as Specified in its Charter)

North Carolina	1-32258	20-0546644
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

401 North Main Street,
Winston-Salem, NC 27101
(Address of Principal Executive Offices) (Zip Code)

Registrant’s telephone number, including area code: 336-741-2000

Not Applicable
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

     At a meeting held on November 30, 2007, the board of directors of Reynolds American Inc., referred to as RAI, appointed Thomas R. Adams as Executive Vice President and Chief Financial Officer of RAI, effective January 1, 2008, to succeed Dianne M. Neal, who announced her decision to resign from such position for personal reasons. Ms. Neal has agreed to continue as an employee of RAI for a transition period ending on March 31, 2008. Also at its meeting on November 30, 2007, RAI’s board of directors appointed Frederick W. Smothers as Senior Vice President and Chief Accounting Officer, effective January 1, 2008, to succeed Mr. Adams in that position. A copy of RAI’s press release announcing the foregoing management changes is attached to this report as Exhibit 99.1.

     Prior to the above appointment, Mr. Adams, age 57, had served as Senior Vice President and Chief Accounting Officer of RAI since March 15, 2007, as Senior Vice President — Business Processes of RAI from November 1, 2006 to March 14, 2007, and as Senior Vice President — Business Processes of R. J. Reynolds Tobacco Company, RAI’s principal operating subsidiary referred to as RJRT, from May 2005 to October 2006. From July 2004 to May 2005, Mr. Adams served as Senior Vice President and Chief Accounting Officer of RAI and RJRT. He also served as Senior Vice President and Controller of R.J. Reynolds Tobacco Holdings, Inc., referred to as RJR, and RJRT from June 1999 to July 2004. From 1985 until 1999, Mr. Adams was a partner at the accounting firm of Deloitte & Touche LLP. Mr. Adams is a member of the board of directors of Technology Concepts & Designs, Inc., an affiliate of RJR; the Old Hickory Council of the Boy Scouts of America; and the board of commissioners of the Housing Authority of the City of Winston-Salem.

     Mr. Smothers, age 44, joined RAI in October 2007 as Vice President and Controller. From 2002 to 2007, he was an independent management consultant, serving as chief executive officer of ATRS Consulting, a firm he owns, from 2005 until October 2007. From 1986 to 2002, Mr. Smothers worked at Deloitte & Touche LLP, serving as a partner at that firm from 1998 to 2002. Prior to Mr. Smothers joining RAI in October 2007, RAI and certain of its subsidiaries used the services of ATRS Consulting. During 2007, prior to Mr. Smothers joining RAI as an employee, RAI and its subsidiaries, as a group, paid ATRS Consulting $346,223 for services rendered in 2007 and for certain services rendered in 2006. RAI and its subsidiaries ceased using the services of ATRS Consulting before Mr. Smothers joined RAI in October 2007, and neither RAI nor any of its subsidiaries currently has any plans to use the services of ATRS Consulting.

     In connection with his appointment as Chief Financial Officer, RAI’s board approved the following changes to Mr. Adams’s compensation package, effective January 1, 2008: (1) an increase in his annual base salary from $345,000 to $500,000; (2) an increase in his annual target bonus from 50% to 75% of his annual base salary; and (3) an increase in the formula for any grants to him under RAI’s Long-Term Incentive Plan, referred to as the LTIP, from a maximum of 1.5 times to a maximum of 2.5 times his annual base salary. Also, RAI’s Board approved the following changes to Mr. Smothers’s compensation package, effective January 1, 2008, in

connection with his promotion to Chief Accounting Officer: (1) an increase in his annual base salary from $290,000 to $319,000; (2) an increase in his annual target bonus from 45% to 50% of his annual base salary; and (3) an increase in the formula for any grants to him under the LTIP from a maximum of 1.0 times to a maximum of 1.5 times his annual base salary. The foregoing payments and benefits are in addition to the other employee benefits to which Messrs. Adams and Smothers are currently entitled.

     In consideration for Ms. Neal remaining employed with RAI for a transition period commencing January 1, 2008, and agreeing to comply with the non-compete and other provisions of a letter agreement with RAI, dated December 5, 2007 (a copy of which is attached to this Report as Exhibit 10.1), RAI’s Board approved the payment to Ms. Neal of a $180,000 retention bonus, provided she remains employed with RAI through March 31, 2008.

     Also, subject to Ms. Neal remaining employed through March 31, 2008, and complying with the other terms of the above mentioned letter agreement, RAI’s Board agreed to treat Ms. Neal’s resignation as a retirement solely for purposes of the LTIP, thus entitling her to vest in a pro rata portion of her LTIP awards which remain outstanding on the last day of her employment. The terms and conditions that otherwise apply to such awards will remain in effect, except that as a result of an amendment approved by RAI’s board at its meeting on November 30, 2007, the performance units granted to Ms. Neal in March 2007 will be paid on a pro rata basis to Ms. Neal as soon as practicable after her employment termination date based upon the initial value of such performance units; in the absence of the amendment, such performance units would have been paid in early 2010 based upon the three-year performance period ending on December 31, 2009. Based upon her expected employment termination date of March 31, 2008, the value of such performance units (which will be payable in cash) is $430,023. The value of Ms. Neal’s other outstanding performance units awarded under the LTIP, which were granted in March 2006, is not currently determinable or estimable; the value of such performance units, also payable in cash, generally will be determined and paid only after the conclusion of the three-year performance period ending on December 31, 2008. Ms. Neal’s remaining outstanding LTIP awards consist of shares of restricted RAI common stock. Based upon the closing per share price of RAI common stock on December 4, 2007, the value of the pro rata number of shares of such restricted stock in which she would vest based upon her expected employment termination date of March 31, 2008, was $926,990.

     Ms. Neal will continue to receive through her employment termination date the same salary payments and other employee benefits which she currently receives or to which she is otherwise entitled, in accordance with the terms of the applicable benefit plan, agreement or program. Ms. Neal will receive no severance or salary continuation payments in connection with her termination of employment.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

     The following are furnished as Exhibits to this Report.

Number	Exhibit
10.1	Letter Agreement, dated December 5, 2007, between Reynolds American Inc. and Dianne M. Neal.
99.1	Press Release of Reynolds American Inc., dated December 4, 2007.

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

REYNOLDS AMERICAN INC.
By:	/s/ McDara P. Folan, III
	Name:	McDara P. Folan, III
	Title:	Senior Vice President, Deputy General Counsel and Secretary

Date: December 6, 2007

EX-10.1

Exhibit 10.1

December 5, 2007

Ms. Dianne M. Neal
505 Boxthorne Court
Winston-Salem, NC 27106

Dear Dianne:

Although you have resigned as Executive Vice President and Chief Financial Officer of Reynolds American, Inc. effective January 1, 2008, it is important that you remain an employee of RAI for a transition period following your resignation to assist your successor and otherwise aid in a smooth transition of your responsibilities. As a result, this letter will confirm our agreement.

In consideration and exchange for the following:

1.	You hereby agree to remain actively employed with RAI through and until March 31, 2008;
2.	You agree to assist your successor and otherwise aid in a smooth transition continuing to satisfactorily carry out your duties and responsibilities as long as you are employed;
3.	You agree to abide by all company policies and procedures including the provisions set forth in the RAI Code of Conduct; and
4.	You agree to execute on your last day of employment a Non-Competition, Non-Disclosure of Confidential Information, Commitment to Provide Assistance and General Release Agreement. (A copy of which is attached).

The Company agrees to the following provided that you meet the obligations set forth above:

1.	You will continue to receive through your employment termination date (irrespective of when such date occurs) the same salary payments and other benefits which you currently receive or to which you are otherwise entitled, except in no event shall your resignation from RAI entitle you to any severance or similar payments;
2.	You will receive payment of a retention bonus in the amount of $180,000 by April 14, 2008;
3.	Your resignation shall be treated as a retirement effective March 31, 2008 solely for the purposes of determining your rights in and to the awards previously made to you pursuant to the Reynolds American, Inc. Long-Term Incentive Plan (Amended and Restated effective May 11, 2007) (the

	“LTIP”), with all other terms and conditions of the LTIP and the individual grant agreements relating to such outstanding awards remaining in effect and applicable to such awards; and
4.	An exception will be made for payment of the Performance Units associated with the 2007 LTIP award. Instead of following the payment terms of the grant agreement, payment will be accelerated and paid by April 14, 2008 for the number of Performance Units that vest pro-rata according to the terms of item 3. The value of each vested unit will be one dollar ($1).

By your signature below, you acknowledge and agree to the terms and conditions of this letter agreement.

Sincerely,

/s/ Ann A. Johnston

Ann A. Johnston
Executive Vice President, Human Resources
Reynolds American, Inc.

Acknowledged and accepted this      5th      day of      December     , 2007

/s/ Dianne M. Neal
Dianne M. Neal

Non-Competition, Non-Disclosure of Confidential Information,
Commitment to Provide Assistance and General Release Agreement

I, Dianne M. Neal, acknowledging a Retention Bonus in the amount of $180,000 and other payments made to me as consideration for entering into this Non-Competition, Non-Disclosure of Confidential Information, Commitment to Provide Assistance Agreement and General Release, do hereby agree to each of the following:

• I will not, without the prior written consent of Reynolds American Inc. (“RAI”), use, divulge, disclose or make accessible to any other person, firm, partnership or corporation or other entity any confidential information pertaining to the businesses of RAI, R. J. Reynolds Tobacco Company, and/or any of their affiliates (individually, a “Company and collectively, the “Companies”), except when required to do so by a court of competent jurisdiction, by any governmental agency having supervisory authority over the businesses of the Companies, or by any administrative body or legislative body (including a committee thereof) with jurisdiction to order me to divulge, disclose or make accessible such information. For purposes of this agreement, “Confidential Information” shall mean non-public information concerning any of the Companies’ data, strategic business plans, product development data (or other proprietary product data), customer lists, marketing plans and other proprietary information, except for specific items which have become publicly available information (other than such items which I know have become publicly available through a breach of fiduciary duty or any confidentiality agreement).

• I covenant and agree that:

(a)

I will not directly or indirectly (whether as owner, partner, consultant, employee, or otherwise), engage in any of the “Major Businesses” (as defined below) in which any of the Companies are engaged, in the geographic area of the U.S. and other country in which the Companies operate as of the day I execute this agreement, for a period of eighteen (18) months following my last day of employment; and

(b)

I will not, on my own behalf or on behalf of any person, firm or company, directly or indirectly for a period of twelve (12) months following the last day of my employment, offer employment to any person who was, at the time of my last day of my employment, employed by any of the Companies.

(c) For purposes of this agreement, “Major Businesses” means the major business segments of any of the Companies dealing in the manufacture, sale or marketing of tobacco and smoking products or products deemed to be in competition with smoking products, including but not limited to those developed, marketed or intended to be used as part of smoking cessation programs, or as tobacco or smoking substitutes.

• I and the Companies agree that this covenant not to compete is a reasonable covenant under the circumstances, and further agree that if in the opinion of any court of competent jurisdiction, such restraint is not reasonable in any respect, such court shall have the right, power and authority to excise or modify such provision or provisions of this covenant as to the court shall appear not reasonable and to enforce the remainder of the covenant as so amended.

• I agree that:

(a)	I will personally provide reasonable assistance and cooperation to the Companies in activities related to the prosecution or defense of any pending or future lawsuits or claims involving any of the Companies.
(b)	I will promptly notify RAI if I receive any requests from anyone other than an employee or agent of one of the Companies for information regarding any of the Companies which could reasonably be construed as being proprietary, non-public or confidential or if I become aware of any potential claim or proposed litigation against any of the Companies.
(c)	I will refrain from providing any information related to any claim or potential litigation against any of the Companies to any non-Company representatives without RAI’s written permission or being required to provide information pursuant to legal process.
(d)	If required by law to provide sworn testimony regarding any matter related to any of the Companies, I will consult with and have legal counsel designated by RAI present for such testimony. RAI will be responsible for the costs

	of such designated counsel, and I will bear no cost for same.
(e)	If I am required by law to provide sworn testimony regarding any matter related to any of the Companies, and if I require legal counsel to represent and protect my interests (in addition to RAI’s designated legal counsel provided for under subparagraph (d) herein), RAI will reimburse me for any legal expenses (including, but not limited to, the costs of any attorney reasonably acceptable to me and RAI, which acceptance by RAI shall not be unreasonably withheld) and other out-of-pocket expenses I may incur in relation to such testimony.
(f)	I will cooperate with the Companies’ attorneys to assist in their efforts, especially on matters I have been privy to, holding all privileged attorney-client matters in strictest confidence unless ordered to do otherwise by a court of competent jurisdiction or a committee of the Congress of the United States or of a state legislature. I understand that I will be reimbursed for travel, food, lodging or similar out-of-pocket expense incurred at the request of any of the Companies in discharging any of my obligations under this agreement.
(g)	Nothing in sentences a-f of the above paragraph is intended to apply to governmental or judicial investigations, including but not limited to an investigation by any agency or department of the federal or state government, any hearing before a committee of the Congress of the United States or of a state legislature, any investigation or proceeding by or of a special prosecutor, or any proceeding brought before a grand jury; provided, however, RAI will reimburse me for legal expenses including, but not limited to, the cost of any attorney reasonably acceptable to RAI and other out-of-pocket expenses if I am compelled to appear in a governmental or judicial investigation.

• I agree that any breach of the covenants contained in this agreement would irreparably injure the Companies. Accordingly, the Companies may, in addition to pursuing any other remedies that they may have in law or in

	equity, obtain an injunction against me from any court having jurisdiction over the matter, restraining any further violation of this agreement by me.
•	IN CONSIDERATION AND IN EXCHANGE OF THE RETENTION BONUS AND OTHER PAYMENTS, I VOLUNTARILY, KNOWINGLY AND WILLINGLY RELEASE AND FOREVER DISCHARGE THE COMPANY (REYNOLDS AMERICAN, INC.), ITS SUBSIDIARIES AND AFFILIATES, TOGETHER WITH THEIR RESPECTIVE OFFICERS, DIRECTORS, SHAREHOLDERS, EMPLOYEES AND AGENTS, AND EACH OF THEIR PREDECESSORS, SUCCESSORS AND ASSIGNS, FROM ANY AND ALL CHARGES, COMPLAINTS, CLAIMS, PROMISES, AGREEMENTS, CONTROVERSIES, CAUSES OF ACTION AND DEMANDS OF ANY NATURE WHATSOEVER THAT I OR MY EXECUTORS, ADMINISTRATORS, SUCCESSORS OR ASSIGNS EVER HAD, NOW HAVE OR HEREAFTER CAN, SHALL OR MAY HAVE AGAINST THEM BY REASON OF ANY MATTER, CAUSE OR THING WHATSOEVER HAVING ACCRUED AND/OR ARISING AT THE TIME I SIGN THIS AGREEMENT. I FURTHER AGREE THAT I WILL NOT SEEK OR BE ENTITLED TO ANY AWARD OF EQUITABLE OR MONETARY RELIEF IN ANY PROCEEDING OF ANY NATURE BROUGHT ON MY BEHALF ARISING OUT OF ANY OF THE MATTERS RELEASED BY THIS PARAGRAPH. THIS RELEASE INCLUDES, BUT IS NOT LIMITED TO ANY RIGHTS OR CLAIMS RELATING IN ANY WAY TO MY EMPLOYMENT RELATIONSHIP WITH THE COMPANY, RESIGNATION OR THE TERMINATION THEREOF, OR UNDER ANY STATUTE, INCLUDING THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, AS AMENDED, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, AS AMENDED, THE AMERICANS WITH DISABILITIES ACT, EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, (“ERISA”) OR ANY OTHER FEDERAL, STATE OR LOCAL LAW, INCLUDING BUT NOT LIMITED TO, ANY SUCH LAW DEALING WITH DISCRIMINATION BASED ON SEX, RACE, COLOR, NATIONAL ORIGIN, RELIGION, DISABILITY, VETERAN STATUS OR AGE.
•	I ALSO AGREE THAT THIS GENERAL RELEASE INCLUDES CLAIMS BASED ON THEORIES OF CONTRACT, WHETHER ACTUAL OR IMPLIED, TORT, PUBLIC POLICY, WHETHER BASED IN COMMON LAW OR OTHERWISE. I UNDERSTAND THAT THIS GENERAL RELEASE COVERS ALL CLAIMS THAT HAVE ACCRUED OR ARISEN BY THE TIME I EXECUTE THIS GENERAL RELEASE, INCLUDING BOTH THOSE CLAIMS THAT I KNOW ABOUT AND THOSE THAT I MAY NOT KNOW ABOUT.

• WITH RESPECT TO ANY CHARGES OR COMPLAINTS THAT HAVE BEEN FILED OR MAY BE FILED CONCERNING EVENTS OR ACTIONS RELATED TO MY EMPLOYMENT, RESIGNATION OR TERMINATION OF EMPLOYMENT, I WAIVE AND RELEASE ANY RIGHT TO RECOVER IN ANY LAWSUIT OR PROCEEDING BROUGHT BY ANY PERSON, ENTITY OR ADMINISTRATIVE AGENCY ON MY BEHALF OR WHICH INCLUDES ME IN A CLASS.

• By signing this Agreement, I represent that I have not commenced any proceeding against the Company in any forum (administrative or judicial) concerning my employment and my decision to resign.

• The Company advised me to consult with an attorney of my choosing prior to signing this Agreement. I understand that I have the right and have been given the opportunity to review this Agreement, specifically the release provisions, with an attorney. I have entered into and signed this Agreement freely, knowingly and voluntarily on my own behalf, and also on the behalf of any heirs, agents, representatives, successors, or assigns.

• I acknowledge I have had at least twenty-one (21) days to consider the terms of this Agreement and that after I sign this agreement I have a period of seven (7) consecutive calendar days to revoke this agreement, and after such seven (7) days it becomes final.

• This Agreement shall be construed, interpreted and governed in accordance with the laws of the State of North Carolina and the United States of America without reference to rules relating to conflicts of law. All provisions and portions of this Agreement are severable. If any provision or portion of this Agreement or the application of any provision or portion of this Agreement to any person, to any circumstance, or to any claims is determined to be invalid or unenforceable to any extent for any reason, the remaining provisions and portions of this Agreement shall be unaffected and shall continue to be enforceable to the fullest extent permitted by law.

Accepted, understood and agreed:

Dianne M. Neal Date

EX-99.1

Exhibit 99.1

Reynolds American Inc.
P.O. Box 2990
Winston-Salem, NC 27102-2990

Contact:	Maura Payne	RAI 2007-29
	(336) 741-6996

Adams Named Executive Vice President and Chief Financial Officer of Reynolds American;
Neal to Resign in 2008

WINSTON-SALEM, N.C. — Dec. 4, 2007 — Dianne M. Neal, executive vice president and chief financial officer of Reynolds American Inc. (NYSE: RAI) has announced her plan to resign in March 2008. The company announced that Thomas R. Adams, currently senior vice president and chief accounting officer of Reynolds American, will replace Neal as RAI’s executive vice president and chief financial officer, effective January 1, 2008.

“Reynolds American is an excellent company with a great future and I have thoroughly enjoyed my 20-year career here,” Neal said. “However, I am looking forward to spending more time with my family, and focusing more of my energy on the corporate boards and community organizations with which I am active.

“Tom Adams is tremendously talented, committed to RAI’s long-term success, and I am confident that I am leaving the CFO role in good hands,” Neal said.

“Dianne played a pivotal role in the shaping and success of Reynolds American,” said Susan M. Ivey, RAI’s chairman and chief executive officer. “Her leadership has enabled RAI to achieve the excellent financial position it enjoys today and we wish her all the best,” she said. “Over the years, Tom has held several key, and diverse, roles in the company. His thorough knowledge of the business and its future growth strategies place him in an excellent position to help take Reynolds American’s success to the next level.”

Adams, 57, joined the organization in 1999 as senior vice president and controller of both R.J. Reynolds Tobacco Holdings, Inc. and R.J. Reynolds Tobacco Company. He was named senior vice president and chief accounting officer for both those companies in 2004, and in 2006, was named senior vice president of business processes. He assumed his current role in March 2007. From 1985 to 1999, Adams was a partner at Deloitte & Touche LLP. He is a member of the board of directors of Technology Concepts & Design, Inc.; the Old Hickory Council of the Boy Scouts of America; and the board of commissioners of the Housing Authority of the City of Winston-Salem.

Replacing Adams as senior vice president and chief accounting officer will be Frederick W. Smothers, 44. Smothers joined RAI in 2007 as vice president and controller. Smothers had previously worked as an independent consultant for ATRS Consulting, and worked for 16 years, including four years as a partner, for the accounting firm of Deloitte & Touche LLP.

Neal, 48, joined R.J. Reynolds Tobacco Company in 1988 as a process manager in that company’s coupon redemption center, and held a number of financial management positions at the company thereafter. In 1997, she was promoted to vice president and controller of Reynolds Tobacco. In 1999, she was promoted to vice president of investor relations for R.J. Reynolds Tobacco Holdings, Inc., which was the public parent company of Reynolds Tobacco at that time. She was named executive vice president and chief financial officer of R.J. Reynolds Tobacco Holdings in 2003, and executive vice president and chief financial officer of Reynolds American in 2005. She is a member of the board of directors of LandAmerica Financial Group, Inc. and Metavante Technologies, Inc. and of the Reynolda House Museum of American Art.

ABOUT US

Reynolds American Inc. (NYSE: RAI) is the parent company of R.J. Reynolds Tobacco Company; Conwood Company, LLC; Santa Fe Natural Tobacco Company, Inc; and R.J. Reynolds Global Products, Inc.

• R.J. Reynolds Tobacco Company, the second-largest U.S. tobacco company, manufactures about one of every three cigarettes sold in the country. The company’s brands include six of the 10 best-selling U.S. brands: Camel, Kool, Pall Mall, Winston, Salem and Doral.

• Conwood Company, LLC is the nation’s second-largest manufacturer of smokeless tobacco products. Its leading brands are Kodiak, Grizzly and Levi Garrett. Conwood also sells and distributes a variety of tobacco products manufactured by Lane, Limited, including Winchester and Captain Black little cigars, and Bugler roll-your-own tobacco.

• Santa Fe Natural Tobacco Company, Inc. manufactures Natural American Spirit cigarettes and other additive-free tobacco products.

• R.J. Reynolds Global Products, Inc. manufactures, sells and distributes American-blend cigarettes and other tobacco products to a variety of customers worldwide.

Copies of RAI’s news releases, annual reports, SEC filings and other financial materials are available at www.ReynoldsAmerican.com.

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