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) April 16, 2014

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)	(I.R.S. 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):

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

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

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

¨ 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.

In March 2014, Daniel M. Delen, President and Chief Executive Officer and director of Reynolds American Inc., referred to as RAI, indicated to the Board of Directors of RAI, referred to as the Board, that he was considering retirement in the near term. On April 16, 2014, Mr. Delen presented his notice of retirement and his resignation from the Board, contingent upon the approval by the Board of the Retirement Agreement, as defined below. At a meeting of the Board held later that day, upon the recommendation of the Board’s Corporate Governance and Nominating Committee, the Board accepted Mr. Delen’s retirement as President and Chief Executive Officer of RAI and resignation from the Board, effective April 30, 2014, referred to as the Retirement Date, pursuant to the terms of the Retirement Agreement. A copy of Mr. Delen’s retirement letter is being furnished as Exhibit 99.1 hereto. Mr. Delen does not serve on any committees of the Board.

On April 16, 2014, the Board elected Susan M. Cameron as RAI’s President and Chief Executive Officer, effective May 1, 2014. Ms. Cameron will continue to serve as a member of the Board, but tendered her resignation from her role as a member of the Strategic Matters Review Committee of the Board, effective May 1, 2014.

Ms. Cameron’s biographical information is set forth under the heading “The Board of Directors — Biographies of Board Members” in RAI’s definitive proxy statement on Schedule 14A filed with the U.S. Securities and Exchange Commission, referred to as the SEC, on March 21, 2014 for RAI’s 2014 annual meeting of shareholders, as supplemented by RAI’s supplement to the notice of annual meeting of shareholders to be held on May 8, 2014 and accompanying proxy materials, to be filed with the SEC on April 17, 2014, and is incorporated by reference into this Item 5.02.

Former Chief Executive Officer Retirement and Consulting Agreement

In connection with Mr. Delen’s retirement, RAI and Mr. Delen have entered into a Retirement and Consulting Agreement, dated as of April 16, 2014, referred to as the Retirement Agreement, which provides that for two years following his Retirement Date, Mr. Delen, acting as an independent contractor, will serve as a consultant and advisor to RAI’s President and Chief Executive Officer and will provide the services as may be reasonably requested from time to time by the President and Chief Executive Officer. The Retirement Agreement contains various restrictive covenants, including covenants relating to non-disclosure, non-competition, non-solicitation, confidentiality and cooperation, that apply to Mr. Delen during the consulting period and will continue to apply to Mr. Delen for two years following the termination of the consulting period. RAI’s obligations under the Retirement Agreement are conditioned upon Mr. Delen executing a release of claims in the form attached to the Retirement Agreement. In consideration of such new obligations and restrictions accepted by Mr. Delen, RAI will pay Mr. Delen the aggregate sum of $13.4 million on June 16, 2014, pursuant to the Retirement Agreement.

The foregoing description of the Retirement Agreement does not purport to be a complete description of its terms and is qualified in all respects by reference to the complete text of the Retirement Agreement, a copy of which is being filed as Exhibit 10.1 hereto and is incorporated into this Item 5.02 by reference.

New Chief Executive Officer Offer Letter

On April 16, 2014, RAI and Ms. Cameron entered into an offer letter, referred to as the Offer Letter, pursuant to which RAI will retain Ms. Cameron as its President and Chief Executive Officer from May 1, 2014 to April 30, 2016. The Offer Letter provides Ms. Cameron the following compensation and benefits:

• Annual base salary of $1,300,000 a year (subject to review and potential adjustment by the Board commencing on May 1, 2015).

• Target annual incentive award under RAI’s Annual Incentive Award Program of 160% of her annual base salary.

• “Sign-on” bonus of $500,000.

• Under the 2009 Omnibus Incentive Compensation Plan, one grant of performance share awards for each of the periods from May 1, 2014 through April 30, 2015 and May 1, 2015 through April 30, 2016, with target opportunities equal to 625% of her annual base salary (subject, in each case, to a dividend threshold and one-year performance goals determined by the Compensation and Leadership Development Committee of the Board).

• Eligibility for RAI’s other benefits for newly hired executives (including future retirement benefits provided under RAI’s 401(k) retirement plan and participation in RAI’s Executive Severance Plan).

The foregoing description of the Offer Letter does not purport to be a complete description of its terms and is qualified in all respects by reference to the complete text of the Offer Letter, a copy of which is being filed as Exhibit 10.2 hereto and is incorporated into this Item 5.02 by reference.

A copy of the press release relating to Mr. Delen’s retirement and resignation and Ms. Cameron’s appointment is being furnished as Exhibit 99.2 hereto.

ITEM 9.01.     Financial Statements and Exhibits.

(d) Exhibits.

Number	Exhibit
10.1	Retirement and Consulting Agreement, by and between Reynolds American Inc. and Daniel M. Delen, dated April 16, 2014
10.2	Offer Letter, by and between Reynolds American Inc. and Susan M. Cameron, dated April 16, 2014
99.1	Letter from Daniel M. Delen, dated April 16, 2014
99.2	Press Release of Reynolds American Inc., dated April 16, 2014

SIGNATURES

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.
Date: April 16, 2014	By:	/s/ McDara P. Folan, III
		Name: McDara P. Folan, III
		Title:  Senior Vice President, Deputy General           Counsel and Secretary

INDEX TO EXHIBITS

Number	Exhibit
10.1	Retirement and Consulting Agreement, by and between Reynolds American Inc. and Daniel M. Delen, dated April 16, 2014
10.2	Offer Letter, by and between Reynolds American Inc. and Susan M. Cameron, dated April 16, 2014
99.1	Letter from Daniel M. Delen, dated April 16, 2014
99.2	Press Release of Reynolds American Inc., dated April 16, 2014

EX-10.1

Exhibit 10.1

RETIREMENT AND CONSULTING AGREEMENT

This Retirement and Consulting Agreement (this “Agreement”), dated as of April 16, 2014 (the “Effective Date”), is entered into by and between Reynolds American Inc. (“RAI”) and Daniel M. Delen (“Delen”).

RECITALS

WHEREAS, Delen has been employed by RAI as RAI’s President and Chief Executive Officer;

WHEREAS, Delen is voluntarily retiring from his employment with RAI effective as of April 30, 2014;

WHEREAS, under Delen’s leadership, RAI and its operating subsidiaries and other affiliates have formed and implemented the strategic vision of Transforming Tobacco;

WHEREAS, Delen has a deep understanding of and critical insights relating to the existing and emerging markets and opportunities for the present and future products and innovations of RAI and its operating subsidiaries and other affiliates; and

WHEREAS, in connection with Delen’s retirement, RAI wishes to continue to benefit from Delen’s knowledge and experience by retaining Delen to perform consulting services and by requiring Delen to fulfill certain other duties and obligations under the terms and conditions of this Agreement, commencing on May 1, 2014.

NOW, THEREFORE, in consideration of (a) the mutual covenants and agreements set forth in this Agreement, and (b) other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

1. Termination of Employment. Delen voluntarily retires from his employment with RAI, effective April 30, 2014. Delen acknowledges that his employment relationship with RAI will terminate for all purposes as of such date. Further, effective April 30, 2014, Delen hereby resigns (a) from the Board of Directors of RAI (the “Board”) and (b) from all other directorships, offices and other positions that he holds with RAI or any other entity that is a subsidiary or parent of, or is otherwise related to or affiliated with, RAI.

2. Consulting Services.

(a) Capacity. Commencing on May 1, 2014, Delen shall serve as a consultant and advisor to the President and Chief Executive Officer of RAI (the “CEO”) and shall provide services as may be reasonably requested from time to time by the CEO (the “Consulting Services”).

(b) Term and Operation. The term of the Consulting Services under this Agreement will commence on May 1, 2014 and will continue until, and will end upon, April 30, 2016, subject to Delen’s continued compliance with this Agreement, including Paragraph 4

hereof (the “Consulting Period”). RAI acknowledges that Delen is not prohibited by this Agreement from obtaining employment with or otherwise providing services to another entity during the Consulting Period, provided, that such other employment or services (i) do not interfere with Delen’s ability to perform the Consulting Services under this Agreement and (ii) are not in violation of Delen’s obligations under Paragraph 4 of this Agreement.

(c) Time Commitment. During the Consulting Period, Delen shall (i) dedicate the amount of his business time and attention which the parties deem reasonably necessary to perform the Consulting Services, (ii) perform the Consulting Services at such locations as he reasonably deems appropriate, and (iii) use his reasonable best efforts to promote the best interests of RAI.

(d) Reimbursement of Expenses. RAI shall reimburse Delen for all reasonable and documented expenses incurred by Delen in the performance of the Consulting Services in accordance with RAI’s policies and procedures in effect from time to time. Delen agrees to provide proper documentation for such expenses as required by RAI’s policies.

3. Independent Contractor. In rendering the Consulting Services described in Paragraph 2 of this Agreement, Delen will at all times be and remain an independent contractor. Delen will be free to exercise his own judgment as to the manner and method of providing the consulting services to RAI, subject to applicable laws and requirements reasonably imposed by RAI. Delen acknowledges and agrees that, during the term of this Agreement, Delen will not be treated as an employee of RAI or any of its affiliates for purposes of federal, state, local or foreign income tax withholding, nor, unless otherwise specifically provided by law, for purposes of the Federal Insurance Contributions Act, the Social Security Act, the Federal Unemployment Tax Act or any Worker’s Compensation law of any state or country, and for purposes of benefits provided to employees of RAI or any of its affiliates under any employee benefit plan. Delen acknowledges and agrees that, as an independent contractor, Delen shall be required, during the term of this Agreement, to pay any applicable taxes on the amounts payable to him under this Agreement attributable to the Consulting Services.

4. Non-Disclosure, Non-Competition, Non-Solicitation, Commitment to Provide Assistance and Other Obligations.

(a) Delen understands and agrees that:

(i) the purpose of this Paragraph 4 is to protect the Related Companies’ legitimate business interests, including, but not limited to, the Related Companies’ Confidential Information, customer relationships and goodwill, all of which contribute to the Related Companies’ competitive advantage in operating the Related Companies’ Businesses in the Territory;

(ii) the Related Companies manufacture, distribute, advertise, promote, market and sell Products in the Territory, and the restrictive covenants contained in this Agreement are necessary to protect the Related Companies’ legitimate business assets and interests, and they are reasonable in time, territory, and scope, and in all other respects;

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(iii) the restrictive covenants contained in this Agreement constitute a material inducement to RAI entering this Agreement, without which RAI would not have entered into this Agreement to engage Delen on the terms and conditions stated herein; and

(iv) the covenants set forth in this Paragraph 4 are essential elements of this Agreement and shall be construed as agreements independent of any other provision in this Agreement, and the existence of any claim or cause of action of Delen against RAI or any other Related Company, whether predicated on this Agreement or otherwise, shall not excuse Delen’s breach, or constitute a defense to the enforcement by the Related Companies, of these restricted covenants. RAI and Delen have had the opportunity to independently consult with their respective counsel for advice in all respects concerning the reasonableness and propriety of such covenants, with specific regard to the nature of the businesses conducted by the Related Companies.

Therefore, to the fullest extent permitted by applicable law, Delen agrees to the restrictions set forth in this Paragraph 4 and all subparagraphs as follows.

(b) Delen acknowledges that, given the position(s) that he has had with one or more of the Related Companies, he has had access to and he has acquired Confidential Information, and will continue to have access to and acquire Confidential Information during the Consulting Period. Delen further acknowledges that the Related Companies have a legitimate and significant business interest in preventing the unauthorized disclosure of the Confidential Information. Accordingly, Delen shall not, without the prior written consent of RAI (which consent may be granted only by RAI’s General Counsel), use, divulge, disclose or make accessible to any other person, firm, partnership, corporation or other entity, for any reason or purpose whatsoever, any Confidential Information, except when required to do so by a court of competent jurisdiction or any Governmental Authority, in any case, with jurisdiction to order Delen to divulge, disclose or make accessible such information. If Delen becomes compelled to disclose any Confidential Information in the circumstances described in the preceding sentence, Delen shall: promptly provide RAI’s General Counsel with written notice thereof, so as to permit RAI to seek a protective order or other appropriate remedy, and Delen shall cooperate with RAI in RAI’s efforts in connection therewith; and disclose only that portion of the Confidential Information that Delen is advised by his counsel (which counsel will be reasonably acceptable to RAI and the reasonable costs and expenses of which will be borne by RAI) Delen is legally required to disclose and shall use reasonable efforts to have such disclosed Confidential Information accorded confidential treatment. Delen further agrees that he shall not talk about or otherwise communicate to any third parties in a malicious, disparaging or defamatory manner regarding any Related Company, or any of their past or present employees, officers, directors, trustees, board members, stockholders, agents, affiliates, parent entities, subsidiaries, successors, assigns and other representatives, and anyone acting on their joint or several behalf, or any aspect of his employment with any Related Company.

(c) During the Consulting Period and for two years after the date of the termination of the Consulting Period for any reason, Delen covenants and agrees that he shall not, directly or indirectly:

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(i) be employed, or retained as an independent contractor, or otherwise provide advisory or consulting services (in each case, whether compensated or not compensated), in a sales-related capacity, marketing role, strategic planning role, financial role, or in a product research and development role for any Competitive Business;

(ii) be employed by, or retained as an independent contractor by, or otherwise provide advisory or consulting services to (in each case, whether compensated or not compensated), any Competitive Business in any sort of position or capacity involving the performance of services that are the same as, or substantially similar to, the services he performed while he was an employee of or a consultant to any Related Company (the “Competitive Services”);

(iii) act (whether compensated or not compensated) as an officer or director of any Competitive Business;

(iv) organize, own (other than owning up to 3% of the outstanding stock of a publicly traded company) or operate any Competitive Business;

(v) (A) be employed, or retained as an independent contractor (in each case, whether compensated or not compensated) by, (B) provide advisory or consulting services (in each case, whether compensated or not compensated) to, (C) organize or operate or (D) serve as a director of (whether compensated or not compensated) any Anti-Tobacco Organization;

(vi) (A) be employed, or retained as an independent contractor (in each case, whether compensated or not compensated) by, (B) provide advisory or consulting services (in each case, whether compensated or not compensated) to or (C) serve as a director or official of (in each case, whether compensated or not compensated) any Regulator; or

(vii) solicit, offer employment to, or hire any employee, independent contractor or any other individual providing services to any Related Company (other than secretarial and clerical personnel), who was employed by, or provided services to, any Related Company, at the time of Delen’s termination of employment or the termination of the Consulting Period, or who was employed by, or provided services to, any Related Company during the 90-day period preceding either such date, to become employed by or otherwise provide services to, any person, firm, entity or corporation or approach any such person for any of the foregoing reasons.

(d) In addition to any other obligations of Delen under law or any other agreement with any Related Company, in consideration of this Agreement, Delen specifically agrees that:

(i) if requested by RAI, Delen shall personally provide reasonable assistance and cooperation to the Related Companies in activities related to the prosecution or defense of any pending or future lawsuits or claims involving any Related Company;

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(ii) Delen shall promptly notify RAI’s General Counsel in writing if Delen receives any request from anyone other than an employee or agent of one of the Related Companies for information regarding any Related Company which could reasonably be construed as being proprietary, non-public or confidential or if Delen becomes aware of any potential claim or proposed litigation against any Related Company;

(iii) Delen shall refrain from providing any information related to any claim or potential litigation against any Related Company to any person who is not a representative of RAI without RAI’s prior written permission, unless required to provide information pursuant to legal process;

(iv) if required by law to provide sworn testimony regarding any matter related to any Related Company, Delen shall consult with and have legal counsel designated by RAI present for such testimony (with RAI being responsible for the costs of such designated counsel); and Delen shall cooperate with RAI’s attorneys to assist their efforts, especially on matters Delen has been privy to, holding all privileged attorney-client matters in strictest confidence; and

(v) if Delen is required by law to provide sworn testimony regarding any matter related to any Related Company, and if Delen desires legal counsel to represent and protect his interests (in addition to RAI’s designated legal counsel provided under subparagraph 4(d)(iv) of this Agreement), RAI shall reimburse Delen for any reasonable legal expenses (including, but not limited to, the reasonable costs of Delen’s counsel) and other reasonable and necessary out-of-pocket expenses Delen may incur in relation to such testimony.

(e) For purposes of this Paragraph 4, the terms below have the following definitions:

(i) “Anti-Tobacco Organization” means any firm, organization, entity, group, or sole proprietorship, the activities or purposes of which include opposing, advocating or lobbying against, or seeking the imposition of restrictions or prohibitions with respect to, any of the Related Companies’ Businesses or the use or consumption of any of the Products.

(ii) “Competitive Business” means any corporation, limited liability company, partnership, person, firm, organization, entity, enterprise, business or activity that is engaged in any of the Related Companies’ Businesses or seeking to engage in any of the Related Companies’ Businesses in the Territory.

(iii) “Confidential Information” means all data, materials and information (whether in the form of samples or in written, graphic, electronic or other form, and whether marked or identified as confidential or proprietary) concerning the business, operations or affairs of any Related Company including, without limitation, information concerning any of the Related Companies’ policies, plans, strategies, trade secrets, know-how, processes, systems, business methods, business or marketing plans, research and development initiatives, products, customers, suppliers and personnel,

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except that Confidential Information shall not include information that (A) is or becomes generally known to the public other than by reason of Delen’s breach of either the provisions of this Agreement or any other duty or obligation (whether arising by contract, statute or otherwise) Delen owes to any Related Company, (B) was known by Delen at the time of the disclosure to Delen by any Related Company, as evidenced by Delen’s written records in existence prior to such disclosure, or (C) is disclosed to Delen after the Effective Date by a third party who has a legal right to make such disclosure, and who is subject to no confidentiality obligation to any Related Company.

(iv) “Governmental Authority” means the government of the United States of America, any other nation or political subdivision thereof, whether state or local, and any agency, authority, administration, instrumentality, regulatory body, court or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

(v) “Regulator” means (A) the U.S. Food and Drug Administration (the “FDA”), the Center for Tobacco Products established within the FDA (the “CTP”), the Tobacco Products Scientific Advisory Committee established within the CTP, or any other office, division, branch, committee, department or other body (collectively, an “Organizational Body”) established by the FDA or by an Organizational Body; or (B) any other Governmental Authority having the authority to regulate, or make recommendations regarding any proposed regulations affecting, any part of any of the Related Companies’ Businesses.

(vi) “Related Companies’ Businesses” means the businesses of manufacturing, distributing, advertising, promoting, marketing or selling any of the following products (collectively, “Products”): (A) any cigarette, cigar, little cigar, “roll-your-own” tobacco, smokeless or smoke-free tobacco product (including, without limitation, moist snuff, dry snuff, snus, loose leaf, plug and twist tobacco and any other smokeless or smoke-free tobacco, including dissolvable products, that may be invented through the date immediately prior to the termination of the Consulting Period); (B) any nicotine replacement therapy products, including nicotine gum, mouth spray and pouches, and any products otherwise marketed or intended to be used as part of a smoking cessation program; (C) any product commonly referred to as an “e-cigarette”; and (D) any other product, including any tobacco or cigarette substitute, that any Related Company invents, develops and/or markets during and through the Consulting Period.

(vii) “Related Company” means any one of the following, individually, and the term “Related Companies” means all of the following, collectively: RAI, R. J. Reynolds Tobacco Company, R.J. Reynolds Vapor Company, RAI International, Inc., American Snuff Company, LLC, RAI Services Company, Santa Fe Natural Tobacco Company, Inc., Niconovum, USA, Inc., Kentucky BioProcessing, Inc., SFR Tobacco International GmbH, and their respective subsidiaries, parents, affiliates (including partnerships and joint ventures in which any Related Company is a partner or joint venturer), successors and assigns.

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(viii) “Territory” means (A) the United States of America, its territories, commonwealths, and possessions (including, without limitation, duty-free stores or outlets located anywhere in any of the foregoing places); (B) U.S. military installations located anywhere in the world; (C) Western Europe; (D) Japan; and (E) any other location in which any Related Company conducts any of the Related Companies’ Businesses during and through the Consulting Period.

(f) Delen agrees that any breach of the covenants contained in this Paragraph 4 would irreparably injure the Related Companies and that their remedies at law would be inadequate. Accordingly, in the event of any breach or threatened breach of this Paragraph 4, the Related Companies, in addition to any other rights and remedies available at law or in equity, shall be entitled to an injunction (and/or other equitable relief), restraining such breach or threatened breach, and be entitled to the reimbursement of court costs, attorneys’ fees and other costs and expenses incurred in connection with enforcing this Agreement. The existence of any claim or cause of action on Delen’s part against any Related Company shall not constitute a defense to the enforcement of these provisions. This Agreement shall be enforceable by any Related Company, either alone or together with any other Related Company or Related Companies. The rights and remedies under this Agreement provided to the Related Companies shall be cumulative and shall be in addition to any other rights or remedies available at law, in equity or under this Agreement.

(g) If any of the provisions of this Paragraph 4 are determined by a court of law to be excessively broad, whether as to geographical area, time, scope, or otherwise, such provision shall be reduced to whatever extent is reasonable and shall be enforced as so modified. Any provisions of this Paragraph 4 not so modified shall remain in full force and effect.

(h) Delen’s obligations in this Paragraph 4 are in addition to any other obligations owing to any Related Company, whether arising by statute, common law, contract or otherwise; provided, however, that to the extent any of Delen’s obligations set forth herein conflict with any provisions of any contract or agreement Delen has previously entered into with, or in favor of, any Related Company, then the terms and provisions of this Agreement shall govern and control, and shall supersede and replace the terms and provisions of such other contract or agreement.

5. Consideration.

(a) In exchange for Delen’s obligations under this Agreement, RAI shall pay Delen an amount equal to $13,400,000, in a lump sum on June 16, 2014. In addition, RAI agrees that it shall ensure that the executive officers of the Company and the members of the Board do not talk about or otherwise communicate to any third parties in a malicious, disparaging or defamatory manner regarding Delen, or any aspect of his employment with any Related Company.

(b) If at any time Delen breaches any provision of Paragraph 2 or 4 of this Agreement, then in addition to all other rights and remedies available to RAI in law or equity, RAI shall have the right to recover any amounts previously paid by RAI to Delen under this

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Agreement. Such amounts shall be paid by Delen to RAI within ten (10) days of a final non-appealable decision of a court of competent jurisdiction that Delen has breached any provision of Paragraph 2 or 4 of this Agreement, as well as any related costs and expenses, including attorneys’ fees, reasonably incurred by RAI in connection with such litigation. If a court of competent jurisdiction determines (in a final non-appealable decision) that Delen has not breached any provision of Paragraph 2 or 4 of this Agreement, RAI shall reimburse Delen for any costs and expenses, including attorneys’ fees, reasonably incurred by Delen in connection with such litigation.

(c) As a condition to RAI’s obligations under this Agreement, Delen shall be required to execute a release of claims in the form attached hereto as Exhibit A.

6. Taxes. RAI may withhold from any amounts payable under this Agreement all federal, state, city or other taxes as RAI is required to withhold pursuant to any applicable law, regulation or ruling.

7. Section 409A. This Agreement is intended to comply with the provisions of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and the regulations relating thereto or an exception to Section 409A of the Code. For purposes of compliance with Section 409A of the Code, each payment of compensation under this Agreement will be treated as a separate payment of compensation, and in no event may Delen, directly or indirectly, designate the calendar year of any payment under this Agreement. All reimbursements provided under this Agreement will be provided in accordance with the requirements of Section 409A of the Code, including, that (a) the amount of expenses eligible for reimbursement during one calendar year will not affect the amount of expenses eligible for reimbursement in any other calendar year; (b) the reimbursement of an eligible expense will be made no later than the last day of the calendar year following the calendar year in which the expense is incurred; and (c) the right to any reimbursement will not be subject to liquidation or exchange for another benefit.

8. Survival. Any provision of this Agreement that by its terms does not terminate upon the termination of the Consulting Period shall survive and continue in full force in accordance with its terms, including but not limited to Paragraphs 4 and 5 hereof.

9. Notice. Any notices required to be given hereunder to RAI shall be addressed to the Corporate Secretary, Reynolds American Inc., Post Office Box 2990, Winston-Salem, NC 27102-2990, and any notice required to be given hereunder to Delen shall be sent to Delen’s address as shown on the records of RAI.

10. Severability. Should any provision of this Agreement be declared or be determined by any court to be invalid, the validity of the remaining parts, terms or provisions shall not be affected thereby, and said invalid part, term or provision shall be deemed not to be part of this Agreement. The waiver of a breach of any of the provisions of this Agreement shall not operate or be construed as a waiver of any other provision of this Agreement or a waiver of any subsequent breach of the same provision.

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11. Counterparts. This Agreement may be executed in separate counterparts, each of which shall be deemed to be an original and both of which taken together shall constitute one and the same agreement.

12. Successors and Assigns. This Agreement shall bind and inure to the benefit of and be enforceable by Delen, RAI and their respective heirs, executors, personal representatives, successors and assigns, except that neither party may assign any rights or delegate any obligations hereunder without the prior written consent of the other party. Delen hereby consents to the assignment by RAI of all of its rights and obligations hereunder to any successor to RAI by merger or consolidation or purchase of all or substantially all of RAI’s assets, provided such transferee or successor assumes the liabilities of RAI hereunder.

13. Choice of Law. This Agreement shall be construed and enforced in accordance with the internal laws of the State of North Carolina without regard to conflict of law principles. Except as otherwise provided in this Paragraph 13, any controversy or dispute arising out of or related to this Agreement shall be settled exclusively in the courts (federal and state) situated in the State of North Carolina, Forsyth County. Delen consents to personal jurisdiction in the State of North Carolina and in the courts thereof for the enforcement of this Agreement, and waives any rights he otherwise may have under the laws of any jurisdiction to object on any basis to jurisdiction or venue within the State of North Carolina to enforce this Agreement. In addition, and notwithstanding the foregoing, RAI may elect, in its discretion, to seek a temporary restraining order or preliminary or permanent injunctive (or similar) relief to enforce its rights under Paragraph 4 of this Agreement in any jurisdiction or court anywhere in the world that RAI determines to be appropriate, and Delen hereby consents to venue in any such jurisdiction or court in such event.

14. Amendment and Waiver. The provisions of this Agreement may be amended or waived only in writing signed by an authorized representative of RAI and by Delen, and no course of conduct or failure or delay in enforcing the provisions of this Agreement shall affect the validity, binding effect or enforceability of this Agreement.

15. Complete Agreement. Except as provided in Paragraph 4(h) of this Agreement, this Agreement embodies the complete agreement and understanding between the parties with respect to the subject matter hereof and, effective as of the Effective Date, supersedes and preempts any prior understandings, agreements or representations by or between the parties, written or oral, which may have related to the subject matter hereof in any way.

[REMAINDER OF PAGE BLANK – FOLLOWED BY SIGNATURE PAGE]

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date and year first above written.

REYNOLDS AMERICAN INC.
By:	/s/ Lisa J. Caldwell
	Name: Lisa J. Caldwell
	Title:  Executive Vice President and          Chief Human Resources Officer

/s/ Daniel M.Delen

Daniel M. Delen

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Exhibit A

REYNOLDS AMERICAN INC.

General Release

This General Release, dated as of April 16, 2014 (“General Release”), is by and between Reynolds American Inc. (“RAI”) and Daniel M. Delen (“Delen”).

1. In exchange for, and as a condition to, RAI’s obligations under the Retirement and Consulting Agreement, dated as of April 16, 2014, by and between RAI and Delen (the “Agreement”), Delen hereby irrevocably and unconditionally releases, waives, and forever discharges RAI, all past and present parents, subsidiaries and affiliates of RAI, and their respective past and present directors, trustees, officers, partners, employees, agents, benefit plans and their respective predecessors, successors and assigns (hereinafter collectively the “Releasees”), from all claims, demands, actions or liabilities (hereinafter “Claims”) Delen may have against any of them, of whatever kind, from the beginning of time through the date this General Release is signed, including, but not limited to, those which are related to Delen’s employment with the Releasees, or the termination of that employment, or to eligibility for severance payments (including under RAI’s Executive Severance Plan (“ESP”). Delen agrees that he has voluntarily executed this General Release on his own behalf, and also on behalf of any heirs, agents, representatives, successors and assigns that he may have now or in the future.

2. Delen also agrees that this General Release covers, but is not limited to, Claims arising from the Fair Labor Standards Act, as amended, the Worker Adjustment and Retraining Notification Act (“WARN”), the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), Title VII of the Civil Rights Act of 1964, as amended, the Americans with Disabilities Act, the Equal Pay Act of 1963, as amended, the Family and Medical Leave Act, and 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 or veteran status. Delen also agrees that this General Release includes Claims based on theories of contract, whether actual or implied, tort or public policy, whether based in common law or otherwise. Delen understands that this General Release covers all Claims that have accrued or arisen by the time he executes this General Release, including both those Claims that he knows about and those that he may not know about. To the extent that Section 1542 of the Civil Code of California applies to his employment, or the termination of his employment, or any similar statute, Delen expressly waives any right or benefit available in any capacity under that Section or any similar statute which provides:

A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor.

With respect to any charges or complaints that have been filed or may be filed concerning events or actions relating to Delen’s employment or termination of employment, he waives and releases any right to recover in any lawsuit or proceeding brought by any person, entity or administrative agency on his behalf or which includes Delen in a class.

3. This General Release does not include rights under the Agreement nor Delen’s nonforfeitable rights to his accrued benefits (within the meaning of Sections 203 and 204 of ERISA) under the RAI 401k Savings Plan and the Reynolds American Omnibus Welfare Benefits Plan, which are not released hereby but survive unaffected by this document. Except as set forth in the preceding sentence, this General Release includes any Claim that Delen would otherwise have to benefits under any plan or program sponsored by the Releasees.

4. Neither the offer of this General Release nor the General Release itself is, or should be interpreted as, an admission by the Releasees that any actions of the Releasees were wrongful, unjustified, discriminatory, illegal or otherwise improper, including, but not limited to, any actions concerning Delen’s employment or the termination of Delen’s employment. Moreover, any such wrongdoing is denied by the Releasees.

5. Delen agrees to abide by the terms of the Agreement.

6. Delen acknowledges and agrees that:

(a) The payments and benefits provided pursuant to the Agreement, as described therein, constitute consideration for this General Release, in that they are payments and benefits and things of value to which Delen would not have been entitled had he not signed this General Release.

(b) Delen has not relied on any representations, promises, or agreements of any kind made to him in connection with his decision to sign this General Release, except for those set forth in the Agreement.

7. All provisions and portions of this General Release are severable. If any portion or portions of this General Release or the application of any provision or portion of this General Release 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 General Release shall be unaffected and shall continue to be enforceable to the fullest and greatest extent permitted by law.

8. Delen understands that this General Release is being offered in the State of North Carolina and agrees that the laws of the State of North Carolina shall govern this agreement without respect to North Carolina’s conflicts of law principles.

[REMAINDER OF PAGE BLANK – FOLLOWED BY SIGNATURE PAGE]

IN WITNESS WHEREOF, Delen and a duly authorized representative of RAI hereby certify that they have read this General Release in its entirety and voluntarily executed it in the presence of competent witnesses, as of the date set forth under their respective signatures.

DANIEL M. DELEN	REYNOLDS AMERICAN INC.
	By:
		Name: Lisa J. Caldwell Title:  Executive Vice President and          Chief Human Resources Officer
Date	Date
Witness	Witness
Date	Date

EX-10.2

Exhibit 10.2

REYNOLDS AMERICAN INC.

April 16, 2014

Ms. Susan M. Cameron

3081 NE 39th Street

Fort Lauderdale, Florida 33308

Dear Susan:

It is my pleasure to confirm our offer to you to join Reynolds American Inc. (“RAI”) as President and Chief Executive Officer. The term of your service will commence on May 1, 2014, and will continue until April 30, 2016 (the “Term”). The Term may be renewed by our mutual agreement.

As President and Chief Executive Officer of RAI, your annual base salary will be $1,300,000. The Board of Directors of RAI (the “Board of Directors”) and the Compensation and Leadership Development Committee of the Board of Directors (the “Compensation Committee”) shall review your annual base salary commencing on May 1, 2015, and may, in its discretion, adjust it.

During the Term, your target annual bonus under our Annual Incentive Award Program (AIAP) will be 160% of your annual base salary, based on the twelve-month periods from May 1, 2014 through April 30, 2015 and May 1, 2015 through April 30, 2016, and on the achievement of specified performance goals, including consideration of the AIAP scores for the most recently ended calendar year. Any annual bonus earned will be paid as soon as practicable after April 30, 2015 and April 30, 2016, as applicable. In addition, as soon as practicable following your commencement of employment, you will be paid a “sign-on” bonus in an amount equal to $500,000.

Under RAI’s 2009 Omnibus Incentive Compensation Plan, you will receive an initial grant of a performance share award for the period from May 1, 2014 through April 30, 2015 (the “2014 Award”), as soon as practicable after appropriate approvals are obtained following your commencement of employment, with a target opportunity equal to 625% of your base salary (the “2014 Target Number”); provided, that if RAI fails to pay cumulative dividends of at least $2.68 per share (the “2014 Dividend Threshold”) during the performance period, the 2014 Target Number shall be reduced by an amount equal to three times the percentage of the dividend underpayment for the performance period, up to a maximum reduction of 50% (the “2014 Revised Target Number”). The 2014 Award will be subject to one-year performance goals as determined by the Compensation Committee; such goals may include acceptable progress by you toward a succession plan. From 0% to as much as 150% of the 2014 Target Number (or the 2014 Revised Target Number if the 2014 Dividend Threshold has not been met) may be earned by you under the 2014 Award, depending on actual achievement of the performance goals and your continued employment through the performance period. In addition, you will receive a grant on or about May 1, 2015 of a performance share award for the period from May 1, 2015

Susan M. Cameron

Page 2

through April 30, 2016 (the “2015 Award”), with a target opportunity equal to 625% of your base salary (the “2015 Target Number”); provided, that if RAI fails to pay the dividend threshold applicable to the 2015 Award during the performance period, the 2015 Target Number shall be reduced by an amount equal to three times the percentage of the dividend underpayment for the performance period, up to a maximum reduction of 50% (the “2015 Revised Target Number”). The 2015 Award will be subject to one-year performance goals as determined by the Compensation Committee; such goals may include achievement by you of an acceptable succession plan. From 0% to as much as 200% of the 2015 Target Number (or the 2015 Revised Target Number if the dividend threshold applicable to the 2015 Award has not been met) may be earned by you under the 2015 Award, depending on actual achievement of the performance goals and your continued employment through the performance period.

Upon commencement of employment, you will be eligible for RAI’s comprehensive package of benefits for newly hired executives (which will include, without limitation, future retirement benefits provided under RAI’s 401(k) retirement plan); however, you will not be eligible for relocation assistance benefits in connection with the commencement of your employment. Such benefits will include your participation in RAI’s Executive Severance Plan, as it may be amended from time to time, which provides severance benefits in the form of salary (defined as base pay plus target annual bonus amount) and benefits. By executing this letter agreement you acknowledge and agree that the annual bonus and performance share awards described above are in lieu of (and you will not otherwise participate in) RAI’s AIAP or long-term incentive program for other executive employees.

As you know, this offer of employment is subject to approval by the Board of Directors. We will provide you with appropriate documentation with respect to your annual bonus and performance share award arrangements described above.

We look forward to having you return to Reynolds American to help us achieve market leadership by transforming the tobacco industry.

Kind regards,

/s/ Lisa J. Caldwell

Lisa J. Caldwell

Executive Vice President and

Chief Human Resources Officer

Acknowledged and Accepted:
/s/ Susan M. Cameron	4/16/14
Susan M. Cameron	Date

EX-99.1

Exhibit 99.1

April 16, 2014

Board of Directors

Reynolds American Inc.

401 N. Main Street

Winston-Salem, North Carolina 27101

Attention: McDara P. Folan, III, Secretary

Dear Dara:

After 25 years in the tobacco industry, subject to the last sentence of this letter, I have decided to retire as an employee of Reynolds American Inc. (the “Company”) on April 30, 2014. It has been a pleasure and a privilege to serve the Company and its shareholders and to work alongside such a driven and talented group of colleagues. I understand the Board is considering and I support the appointment of Susan M. Cameron to serve as my successor. To ensure an orderly transition, I hereby submit my retirement as President and Chief Executive Officer and resignation as Director of the Company and as President of RAI Services Company, effective in each case at the close of business on April 30, 2014. This letter will only take effect upon the approval by the Board of Directors of the Company, and execution by the Company and me, of the Retirement and Consulting Agreement and General Release in substantially the form as have been presented to and reviewed by me.

Sincerely,

/s/ Daniel M. Delen

Daniel M. Delen

EX-99.2

Exhibit 99.2

Reynolds American Inc.

P.O. Box 2990

Winston-Salem, NC 27102-2990

Contact: Investor Relations: Morris Moore (336) 741-3116 Media: Maura Payne (336) 741-6996 RAI 2014-06

Susan Cameron elected President and CEO of Reynolds American Inc.;

Daniel Delen to retire

WINSTON-SALEM, N.C. – April 16, 2014 – The board of directors of Reynolds American Inc. (NYSE: RAI) has elected Susan M. Cameron president and chief executive officer, effective May 1. She will also remain a member of the RAI board of directors.

Cameron served as president, CEO and a member of the RAI board from 2004 to 2011. She also served as chairman of the board of RAI between 2006 and 2010. In 2011, she retired from the company and the board. She rejoined RAI’s board of directors in December 2013.

Cameron replaces Daniel M. Delen, who has chosen to retire and resign from the RAI board. Delen has served as president and CEO of RAI since 2011. Delen will continue to consult with the company for two years to ensure a smooth transition and provide strategic insights and other services to management.

“Susan’s 30 years of experience with our companies and her previous service in this role make her an exemplary choice for this key leadership position,” said Thomas C. Wajnert, non-executive chairman of RAI’s board of directors. “Susan was the architect of RAI’s ‘total tobacco’ strategic direction more than 10 years ago, and we’re pleased to have her back with the company to further our vision of transforming tobacco,” Wajnert said.

“Under Daan Delen’s leadership, RAI and its operating companies have demonstrated that their strategic plans to transform tobacco are sound, and their ability to operationally deliver against those strategies is excellent. On behalf of the board and RAI’s shareholders, I thank him for his leadership and his commitment to providing outstanding returns to our investors. We wish him nothing but the best in his future endeavors,” Wajnert said.

“I’m excited about returning to RAI,” Cameron said. “Daan has provided tremendous leadership over the last three years, and as a result, RAI and its operating companies are foundationally very strong. Being back on the board of directors for the last five months gave me the opportunity to dive back into the businesses. RAI’s strategic mission to transform the tobacco industry is a fascinating journey. I’m looking forward to the opportunity to not just advance, but accelerate, that momentum as CEO,” she said.

“I am confident that RAI and its operating companies will continue to reach new levels of success – both commercially and in their influence on the future of the tobacco industry,” Delen said. “After 25 years in this industry, I have the opportunity to pursue new interests, and I will do so knowing that the RAI companies and their employees are in the best possible hands to see that journey through,” he said.

Web Disclosure

RAI’s website, www.reynoldsamerican.com, is the primary source of publicly disclosed news about RAI and its operating companies. We use the website as our primary means of distributing quarterly earnings and other company news. We encourage investors and others to register at www.reynoldsamerican.com to receive alerts when news about the company has been posted.

ABOUT US

Reynolds American Inc. (NYSE: RAI) is the parent company of R.J. Reynolds Tobacco Company; American Snuff Company, LLC; Santa Fe Natural Tobacco Company, Inc.; Niconovum USA, Inc.; Niconovum AB; and R.J. Reynolds Vapor Company.

• R.J. Reynolds Tobacco Company is the second-largest U.S. tobacco company. R.J. Reynolds’ brands include two of the best-selling cigarettes in the U.S.: Camel and Pall Mall. These brands, and its other brands, including Winston, Kool, Doral, Salem, Misty and Capri, are manufactured in a variety of styles and marketed in the U.S.

• American Snuff Company, LLC is the nation’s second-largest manufacturer of smokeless tobacco products. Its leading brands are Grizzly and Kodiak.

• Santa Fe Natural Tobacco Company, Inc. manufactures and markets Natural American Spirit 100% additive-free natural tobacco products, including styles made with organic tobacco.

• Niconovum USA, Inc. and Niconovum AB market innovative nicotine replacement therapy products in the U.S. and Sweden, respectively, under the Zonnic brand name.

• R.J. Reynolds Vapor Company makes and markets VUSE e-cigarettes, a highly differentiated vapor product.

Copies of RAI’s news releases, annual reports, SEC filings and other financial materials, including risk factors containing forward-looking information, are available at www.reynoldsamerican.com. To learn how RAI and its operating companies are transforming the tobacco industry, go to the RAI website, Transforming Tobacco.

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