EX-10.2






Exhibit 10.2




Amendment No. 1

to the

Reynolds American Inc.

Annual Incentive Award Plan

(As Amended and Restated as of January 1, 2009)




     THIS AMENDMENT NO. 1 to the Reynolds American Inc. Annual Incentive Award Plan, as amended and
restated as of January 1, 2009 (the “Plan”), is made and entered into as of the 3rd day
of February, 2009. Except as otherwise indicated, the provisions of this Amendment shall be
effective as of February 3, 2009.



W I T N E S S E T H




     WHEREAS, Reynolds American Inc. (“RAI”) maintains the Plan for the benefit of its employees
and its subsidiaries and affiliates designated as participating companies; and



     WHEREAS, the Board of Directors of RAI (the “Board”), by actions taken on February 3, 2009,
authorized amendments to the Plan adding a new section providing for the recoupment of amounts paid
under the Plan under certain specific circumstances and updating the name of the committee
responsible for administering the Plan; and



     WHEREAS, such actions of the Board further authorized the officers of RAI and their designees
to perform any and all acts and execute any and all documents that they may deem necessary to
effectuate the Board’s resolutions;



     NOW, THEREFORE, the Plan hereby is amended as follows:



I.




     A new Section 15 is inserted immediately following Section 14 of the Plan to read as follows:




	 	“15.	 	 Recoupment






	 	(a)	 	Subject to the clawback provisions of the
Sarbanes-Oxley Act of 2002, the Committee may, in its sole discretion,
direct that RAI recoup all or a portion of any amount paid to the
Participant hereunder computed using financial information or
performance metrics later found to be materially inaccurate. The
amount to be recovered shall be equal to the excess of the amount paid
out over the amount that would have been paid out had such financial
information or performance metric been fairly stated at the time the
payout was made.




 









 






	 	(b)	 	If after a demand for recoupment of any amount under
this Section 15 of this Plan, the Participant fails to return such
amount to RAI, RAI (or RAI through the actions of any of Participating
Company employing the Participant, if applicable) shall have the right
to effect the recovery of the value of the award amount and the amount
of its court costs, attorneys’ fees and other costs and expenses
incurred in connection with enforcing this Section 15 of the Plan by
(i) deducting (subject to applicable law and the terms and conditions
of the Plan) from any amounts RAI (and if applicable, any Participating
Company employing the Participant) owes to the Participant (including,
but not limited to, wages or other compensation), (ii) withholding
payment of future increases in compensation (including the payment of
any discretionary bonus amount) or grants of compensatory awards that
otherwise would have been made in accordance with RAI’s or any
Participating Company’s otherwise applicable compensation practices, or
(iii) any combination of the foregoing. The right of recoupment set
forth in the preceding sentence shall not be the exclusive remedy of
RAI, and RAI may exercise each and every other remedy available to it
under applicable law.”





II.




     Section (h) of the Definitions set forth in Exhibit A attached to the Plan is amended to read
as follows:




	 	“(h)	 	‘Committee’ shall mean the Compensation and Leadership Development Committee of
the Board of Directors.”





     IN WITNESS WHEREOF, the Company has executed this Amendment No. 1 to the Plan on the day and
year first written above.



	 	 	 	 	 
	 	Reynolds American Inc.

 	 
	 	By:  	/s/ Lisa J. Caldwell
 	 
	 	 	Lisa J. Caldwell 	 
	 	 	Executive Vice President – Human Resources