EXHIBIT 3.1
 
                                    RESTATED
 
                          CERTIFICATE OF INCORPORATION
 
                                       OF
 
                      R.J. REYNOLDS TOBACCO HOLDINGS, INC.
 
                                      *****
 
                  Pursuant to Sections 228, 242 and 245 of the
                General Corporation Law of the State of Delaware
 
         The undersigned H. Colin McBride, Secretary of R.J. Reynolds Tobacco
Holdings, Inc. (the "Corporation"), certifies as follows:
 
            1.  (a)  The name of the Corporation is currently R.J. Reynolds
Tobacco Holdings, Inc.
 
           (b) The Corporation was originally incorporated under the name R.J.
Reynolds Industries, Inc. The original Certificate of Incorporation of the
Corporation was filed with the Secretary of State of the State of Delaware on
March 4, 1970.
 
            2. The Certificate of Incorporation is hereby amended by striking
out Articles I through VI thereof and by substituting new Articles First through
Ninth which are set forth in the Restated Certificate of Incorporation below.
 
            3. The provisions of the Certificate of Incorporation of the
Corporation as heretofore amended and/or supplemented, and as herein amended,
are hereby restated and integrated into the single instrument entitled "Restated
Certificate of Incorporation of R.J. Reynolds Tobacco Holdings, Inc." set forth
below.
 
            4. The amendments and the restatement of the Restated Certificate of
Incorporation certified herein have been duly adopted by the sole stockholder of
the Corporation in accordance with the provisions of Sections 228, 242 and 245
of the General Corporation Law of the State of Delaware.
 
 
 
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                                    RESTATED
                          CERTIFICATE OF INCORPORATION
                                       OF
                      R.J. REYNOLDS TOBACCO HOLDINGS, INC.
 
                   (Originally incorporated under the name of
                R.J. Reynolds Industries, Inc. on March 4, 1970)
 
                                  ARTICLE FIRST
 
         The name of the Corporation is R.J. Reynolds Tobacco Holdings, Inc.
 
                                 ARTICLE SECOND
 
         The address of its registered office in the State of Delaware is 1013
Centre Road, City of Wilmington, County of New Castle, Delaware 19805. The name
of its registered agent at such address is The Prentice-Hall Corporation System,
Inc.
 
                                  ARTICLE THIRD
 
         The purpose of the Corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of the State of Delaware, as the same exists or may hereafter be amended
(the "DGCL").
 
                                 ARTICLE FOURTH
 
         The total number of shares of capital stock that the Corporation is
authorized to issue is 340,000,000 shares of which 290,000,000 shares are Common
Stock, par value $.01 each ("Common Stock"), and 50,000,000 shares are Preferred
Stock, par value $.01 each (hereinafter referred to as "Preferred Stock"). The
Corporation may issue the Preferred Stock from time to time in one or more
series with such distinctive designations as may be stated in the resolution or
resolutions providing for the issue of such stock from time to time adopted by
the Board of Directors or a duly authorized committee thereof. The resolution or
resolutions providing for the issue of shares of a particular series shall fix,
subject to applicable laws and the provisions of this ARTICLE FOURTH, for each
such series the number of shares constituting such series and the designations
and powers, preferences and relative participating, optional or other special
rights and qualifications, limitations or restrictions thereof, including,
without limiting the generality of the foregoing, such provisions as may be
desired concerning voting, redemption, dividends, dissolution or the
distribution of assets, conversion or
 
 
 
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exchange, and such other subjects or matters as may be fixed by resolution or
resolutions of the Board of Directors or a duly authorized committee thereof
under the DGCL. The number of authorized shares of any class or classes of stock
may be increased or decreased (but not below the number of shares thereof then
outstanding) by the affirmative vote of the holders of a majority of the Common
Stock of the Corporation irrespective of the provisions of Section 242(b)(2) of
the DGCL or any corresponding provision hereafter enacted.
 
         The following is a statement of the number, designation, powers,
preferences and relative, participating, optional or other special rights and
qualifications, limitations or restrictions of the Series A Junior Participating
Preferred Stock (the "Series A Preferred Stock") of the Corporation:
 
         (1) Designation and Number of Shares. The shares of such series shall
be designated as "Series A Junior Participating Preferred Stock, par value $0.01
per share", and the number of shares constituting such series shall be
2,000,000. Such number of shares of the Series A Preferred Stock may be
increased or decreased by resolution of the Board of Directors; provided that no
decrease shall reduce the number of shares of Series A Preferred Stock to a
number less than the number of shares then outstanding plus the number of shares
issuable upon exercise or conversion of outstanding rights, options or other
securities issued by the Corporation.
 
         (2)      Dividends and Distributions.
 
          (a) The holders of shares of Series A Preferred Stock shall be
         entitled to receive, when, as and if declared by the Board of Directors
         out of funds legally available for the purpose, quarterly dividends
         payable on January 1, April 1, July 1 and October 1 of each year (each
         such date being referred to herein as a "Quarterly Dividend Payment
         Date"), commencing on the first Quarterly Dividend Payment Date after
         the first issuance of any share or fraction of a share of Series A
         Preferred Stock, in an amount per share (rounded to the nearest cent)
         equal to the greater of (i) $1.00 and (ii) subject to the provision for
         adjustment hereinafter set forth, 100 times the aggregate per share
         amount of all cash dividends or other distributions and 100 times the
         aggregate per share amount of all non-cash dividends or other
         distributions (other than (A) a dividend payable in shares of Common
         Stock or (B) a subdivision of the outstanding shares of Common Stock
         (by reclassification or otherwise)), declared on the Common Stock since
         the immediately preceding Quarterly Dividend Payment Date, or, with
         respect to the first Quarterly Dividend Payment Date, since the first
         issuance of any share or fraction of a share of Series A Preferred
         Stock. If the Corporation shall at any time after May 17, 1999 (the
         "Rights
 
 
 
 
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<PAGE>
 
 
 
         Declaration Date") pay any dividend on Common Stock payable in shares
         of Common Stock or effect a subdivision or combination of the
         outstanding shares of Common Stock (by reclassification or otherwise)
         into a greater or lesser number of shares of Common Stock, then in each
         such case the amount to which holders of shares of Series A Preferred
         Stock were entitled immediately prior to such event under clause
         2(a)(ii) of the preceding sentence shall be adjusted by multiplying
         such amount by a fraction the numerator of which is the number of
         shares of Common Stock outstanding immediately after such event and the
         denominator of which is the number of shares of Common Stock that were
         outstanding immediately prior to such event.
 
          (b) The Corporation shall declare a dividend or distribution on the
         Series A Preferred Stock as provided in paragraph 2(a) above
         immediately after it declares a dividend or distribution on the Common
         Stock (other than as described in clauses 2(a)(ii)(A) and 2(a)(ii)(B)
         above); provided that if no dividend or distribution shall have been
         declared on the Common Stock during the period between any Quarterly
         Dividend Payment Date and the next subsequent Quarterly Dividend
         Payment Date (or, with respect to the first Quarterly Dividend Payment
         Date, the period between the first issuance of any share or fraction of
         a share of Series A Preferred Stock and such first Quarterly Dividend
         Payment Date), a dividend of $1.00 per share on the Series A Preferred
         Stock shall nevertheless be payable on such subsequent Quarterly
         Dividend Payment Date.
 
          (c) Dividends shall begin to accrue and be cumulative on outstanding
         shares of Series A Preferred Stock from the Quarterly Dividend Payment
         Date next preceding the date of issue of such shares of Series A
         Preferred Stock, unless the date of issue of such shares is on or
         before the record date for the first Quarterly Dividend Payment Date,
         in which case dividends on such shares shall begin to accrue and be
         cumulative from the date of issue of such shares, or unless the date of
         issue is a date after the record date for the determination of holders
         of shares of Series A Preferred Stock entitled to receive a quarterly
         dividend and on or before such Quarterly Dividend Payment Date, in
         which case dividends shall begin to accrue and be cumulative from such
         Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not
         bear interest. Dividends paid on shares of Series A Preferred Stock in
         an amount less than the total amount of such dividends at the time
         accrued and payable on such shares shall be allocated pro rata on a
         share-by-share basis among all such shares at the time outstanding. The
         Board of Directors may fix a record date for the determination of
         holders of shares
 
 
 
 
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         of Series A Preferred Stock entitled to receive payment of a dividend
         or distribution declared thereon, which record date shall not be more
         than 60 days prior to the date fixed for the payment thereof.
 
         (3) Voting Rights. In addition to any other voting rights required by
law, the holders of shares of Series A Preferred Stock shall have the following
voting rights:
 
           (a) Subject to the provision for adjustment hereinafter set forth,
         each share of Series A Preferred Stock shall entitle the holder thereof
         to 100 votes on all matters submitted to a vote of stockholders of the
         Corporation. If the Corporation shall at any time after the Rights
         Declaration Date pay any dividend on Common Stock payable in shares of
         Common Stock or effect a subdivision or combination of the outstanding
         shares of Common Stock (by reclassification or otherwise) into a
         greater or lesser number of shares of Common Stock, then in each such
         case the number of votes per share to which holders of shares of Series
         A Preferred Stock were entitled immediately prior to such event shall
         be adjusted by multiplying such number by a fraction the numerator of
         which is the number of shares of Common Stock outstanding immediately
         after such event and the denominator of which is the number of shares
         of Common Stock that were outstanding immediately prior to such event.
 
           (b) Except as otherwise provided herein or by law, the holders of
         shares of Series A Preferred Stock and the holders of shares of Common
         Stock shall vote together as a single class on all matters submitted to
         a vote of stockholders of the Corporation.
 
                    (c) (i) If at any time dividends on any Series A Preferred
         Stock shall be in arrears in an amount equal to six quarterly dividends
         thereon, the occurrence of such contingency shall mark the beginning of
         a period (herein called a "default period") which shall extend until
         such time when all accrued and unpaid dividends for all previous
         quarterly dividend periods and for the current quarterly dividend
         period on all shares of Series A Preferred Stock then outstanding shall
         have been declared and paid or set apart for payment. During each
         default period, all holders of Preferred Stock and any other series of
         Preferred Stock then entitled as a class to elect directors, voting
         together as a single class, irrespective of series, shall have the
         right to elect two Directors.
 
                           (ii) During any default period, such voting right of
                  the holders of Series A Preferred Stock may be exercised
                  initially at a special meeting called pursuant to subparagraph
                  3(c)(iii) hereof or
 
 
 
 
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                  at any annual meeting of stockholders, and thereafter at
                  annual meetings of stockholders; provided that neither such
                  voting right nor the right of the holders of any other series
                  of Preferred Stock, if any, to increase, in certain cases, the
                  authorized number of Directors shall be exercised unless the
                  holders of 10% in number of shares of Preferred Stock
                  outstanding shall be present in person or by proxy. The
                  absence of a quorum of holders of Common Stock shall not
                  affect the exercise by holders of Preferred Stock of such
                  voting right. At any meeting at which holders of Preferred
                  Stock shall exercise such voting right initially during an
                  existing default period, they shall have the right, voting as
                  a class, to elect Directors to fill such vacancies, if any, in
                  the Board of Directors as may then exist up to two Directors
                  or, if such right is exercised at an annual meeting, to elect
                  two Directors. If the number which may be so elected at any
                  special meeting does not amount to the required number, the
                  holders of the Preferred Stock shall have the right to make
                  such increase in the number of Directors as shall be necessary
                  to permit the election by them of the required number. After
                  the holders of the Preferred Stock shall have exercised their
                  right to elect Directors in any default period and during the
                  continuance of such period, the number of Directors shall not
                  be increased or decreased except by vote of the holders of
                  Preferred Stock as herein provided or pursuant to the rights
                  of any equity securities ranking senior to or pari passu with
                  the Series A Preferred Stock.
 
                           (iii) Unless the holders of Preferred Stock shall,
                  during an existing default period, have previously exercised
                  their right to elect Directors, the Board of Directors may
                  order, or any stockholder or stockholders owning in the
                  aggregate not less than 10% of the total number of shares of
                  Preferred Stock outstanding, irrespective of series, may
                  request, the calling of a special meeting of holders of
                  Preferred Stock, which meeting shall thereupon be called by
                  the President, a Vice President or the Secretary of the
                  Corporation. Notice of such meeting and of any annual meeting
                  at which holders of Preferred Stock are entitled to vote
                  pursuant to this paragraph 3(c)(iii) shall be given to each
                  holder of record of Preferred Stock by mailing a copy of such
                  notice to him at his last address as the same appears on the
                  books of the Corporation. Such meeting shall be called for a
                  time not earlier than 20 days and not later than 60 days after
                  such order or request or in default of the calling of such
                  meeting within 60 days after such order or request, such
                  meeting may be called on similar notice by any stockholder or
 
 
 
 
                                        6
 
<PAGE>
 
 
 
                  stockholders owning in the aggregate not less than 10% of the
                  total number of shares of Preferred Stock outstanding,
                  irrespective of series. Notwithstanding the provisions of this
                  paragraph 3(c)(iii), no such special meeting shall be called
                  during the period within 60 days immediately preceding the
                  date fixed for the next annual meeting of stockholders.
 
                           (iv) In any default period, the holders of Common
                  Stock, and other classes of stock of the Corporation if
                  applicable, shall continue to be entitled to elect the whole
                  number of Directors until the holders of Preferred Stock shall
                  have exercised their right to elect two Directors voting as a
                  class, after the exercise of which right (x) the Directors so
                  elected by the holders of Preferred Stock shall continue in
                  office until their successors shall have been elected by such
                  holders or until the expiration of the default period, and (y)
                  any vacancy in the Board of Directors may (except as provided
                  in paragraph 3(c)(ii) hereof) be filled by vote of a majority
                  of the remaining Directors theretofore elected by the holders
                  of the class of stock which elected the Director whose office
                  shall have become vacant. References in this paragraph 3(c) to
                  Directors elected by the holders of a particular class of
                  stock shall include Directors elected by such Directors to
                  fill vacancies as provided in clause (y) of the foregoing
                  sentence.
 
                           (v) Immediately upon the expiration of a default
                  period, (x) the right of the holders of Preferred Stock as a
                  class to elect Directors shall cease, (y) the term of any
                  Directors elected by the holders of Preferred Stock as a class
                  shall terminate, and (z) the number of Directors shall be such
                  number as may be provided for in the certificate of
                  incorporation or bylaws irrespective of any increase made
                  pursuant to the provisions of paragraph 3(c)(ii) hereof (such
                  number being subject, however, to change thereafter in any
                  manner provided by law or in the certificate of incorporation
                  or bylaws). Any vacancies in the Board of Directors effected
                  by the provisions of clauses (y) and (z) in the preceding
                  sentence may be filled by a majority of the remaining
                  Directors.
 
                  (d) The Certificate of Incorporation of the Corporation shall
         not be amended in any manner (whether by merger or otherwise) so as to
         adversely affect the powers, preferences or special rights of the
         Series A Preferred Stock without the affirmative vote of the holders of
         a majority of the outstanding shares of Series A Preferred Stock,
         voting separately as a class.
 
 
 
 
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<PAGE>
 
 
 
                  (e) Except as otherwise provided herein, holders of Series A
         Preferred Stock shall have no special voting rights, and their consent
         shall not be required for taking any corporate action.
 
         (4)      Certain Restrictions.
 
                  (a) Whenever quarterly dividends or other dividends or
         distributions payable on the Series A Preferred Stock as provided in
         Section 2 are in arrears, thereafter and until all accrued and unpaid
         dividends and distributions, whether or not declared, on outstanding
         shares of Series A Preferred Stock shall have been paid in full, the
         Corporation shall not:
 
                           (i) declare or pay dividends on, or make any other
                  distributions on, any shares of stock ranking junior (either
                  as to dividends or upon liquidation, dissolution or winding
                  up) to the Series A Preferred Stock;
 
                           (ii) declare or pay dividends on, or make any other
                  distributions on, any shares of stock ranking on a parity
                  (either as to dividends or upon liquidation, dissolution or
                  winding up) with the Series A Preferred Stock, except
                  dividends paid ratably on the Series A Preferred Stock and all
                  such other parity stock on which dividends are payable or in
                  arrears in proportion to the total amounts to which the
                  holders of all such shares are then entitled;
 
                           (iii) redeem, purchase or otherwise acquire for value
                  any shares of stock ranking junior (either as to dividends or
                  upon liquidation, dissolution or winding up) to the Series A
                  Preferred Stock; provided that the Corporation may at any time
                  redeem, purchase or otherwise acquire shares of any such
                  junior stock in exchange for shares of stock of the
                  Corporation ranking junior (as to dividends and upon
                  dissolution, liquidation or winding up) to the Series A
                  Preferred Stock; or
 
                           (iv) redeem, purchase or otherwise acquire for value
                  any shares of Series A Preferred Stock, or any shares of stock
                  ranking on a parity (either as to dividends or upon
                  liquidation, dissolution or winding up) with the Series A
                  Preferred Stock, except in accordance with a purchase offer
                  made in writing or by publication (as determined by the Board
                  of Directors) to all holders of Series A Preferred Stock and
                  all such other parity stock upon such terms as the Board of
                  Directors, after consideration of the respective annual
 
 
 
 
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<PAGE>
 
 
 
                  dividend rates and other relative rights and preferences of
                  the respective series and classes, shall determine in good
                  faith will result in fair and equitable treatment among the
                  respective series or classes.
 
                  (b) The Corporation shall not permit any subsidiary of the
         Corporation to purchase or otherwise acquire for value any shares of
         stock of the Corporation unless the Corporation could, under paragraph
         4(a), purchase or otherwise acquire such shares at such time and in
         such manner.
 
         (5) Reacquired Shares. Any shares of Series A Preferred Stock redeemed,
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall be retired and canceled promptly after the acquisition thereof. All such
shares shall upon their cancellation become authorized but unissued shares of
Preferred Stock without designation as to series and may be reissued as part of
a new series of Preferred Stock to be created by resolution or resolutions of
the Board of Directors as permitted by the Certificate of Incorporation or as
otherwise permitted under Delaware Law.
 
         (6) Liquidation, Dissolution and Winding Up. Upon any liquidation,
dissolution or winding up of the Corporation, no distribution shall be made (1)
to the holders of shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Preferred Stock unless,
prior thereto, the holders of shares of Series A Preferred Stock shall have
received $1.00 per share, plus an amount equal to accrued and unpaid dividends
and distributions thereon, whether or not declared, to the date of such payment;
provided that the holders of shares of Series A Preferred Stock shall be
entitled to receive an aggregate amount per share, subject to the provision for
adjustment hereinafter set forth, equal to 100 times the aggregate amount to be
distributed per share to holders of Common Stock, or (2) to the holders of stock
ranking on a parity (either as to dividends or upon liquidation, dissolution or
winding up) with the Series A Preferred Stock, except distributions made ratably
on the Series A Preferred Stock and all such other parity stock in proportion to
the total amounts to which the holders of all such shares are entitled upon such
liquidation, dissolution or winding up. If the Corporation shall at any time
after the Rights Declaration Date pay any dividend on Common Stock payable in
shares of Common Stock or effect a subdivision or combination of the outstanding
shares of Common Stock (by reclassification or otherwise) into a greater or
lesser number of shares of Common Stock, then in each such case the aggregate
amount to which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event under the proviso in clause (1) of the preceding
sentence shall be adjusted by multiplying such amount by a fraction the
numerator of which is
 
 
 
 
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<PAGE>
 
 
 
the number of shares of Common Stock outstanding immediately after such event
and the denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
 
         (7) Consolidation, Merger, Etc. If the Corporation shall enter into any
consolidation, merger, combination or other transaction in which the shares of
Common Stock are exchanged for or changed into other stock or securities, cash
or any other property, then in any such case the shares of Series A Preferred
Stock shall at the same time be similarly exchanged for or changed into an
amount per share, subject to the provision for adjustment hereinafter set forth,
equal to 100 times the aggregate amount of stock, securities, cash or any other
property, as the case may be, into which or for which each share of Common Stock
is changed or exchanged. If the Corporation shall at any time after the Rights
Declaration Date pay any dividend on Common Stock payable in shares of Common
Stock or effect a subdivision or combination of the outstanding shares of Common
Stock (by reclassification or otherwise) into a greater or lesser number of
shares of Common Stock, then in each such case the amount set forth in the
preceding sentence with respect to the exchange or change of shares of Series A
Preferred Stock shall be adjusted by multiplying such amount by a fraction the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
 
         (8) No Redemption. The Series A Preferred Stock shall not be
redeemable.
 
         (9) Rank. The Series A Preferred Stock shall rank junior (as to
dividends and upon liquidation, dissolution and winding up) to all other series
of the Corporation's preferred stock except any series that specifically
provides that such series shall rank junior to the Series A Preferred Stock.
 
         (10) Fractional Shares. Series A Preferred Stock may be issued in
fractions of a share which shall entitle the holder, in proportion to such
holder's fractional shares, to exercise voting rights, receive dividends,
participate in distributions and to have the benefit of all other rights of
holders of Series A Preferred Stock.
 
 
                                  ARTICLE FIFTH
 
         The Board of Directors of the Corporation, acting by majority vote, may
alter, amend or repeal the By-Laws of the Corporation. The stockholders may
adopt, amend or repeal the By-Laws only with the affirmative vote of the holders
 
 
 
 
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<PAGE>
 
 
 
of not less than 80% of the outstanding securities of the Corporation then
entitled to vote thereon, voting together as a single class.
 
                                  ARTICLE SIXTH
 
         (1) The business and affairs of the Corporation shall be managed by or
under the direction of the Board of Directors. Officers of the Corporation shall
be elected by, or in the manner approved by, the Board of Directors.
 
          (2) The Board of Directors shall consist of not less than five nor
more than twelve directors, with the exact number of directors to be determined
from time to time by resolution adopted by the Board of Directors.
 
         (3) The members of the Board of Directors shall be divided into three
classes, designated Class I, Class II and Class III. Each class shall consist,
as nearly as may reasonably be possible, of one-third of the total number of
directors constituting the Board of Directors. Each director shall serve for a
term ending on the date of the third annual meeting of stockholders next
following the annual meeting at which such director was elected, provided that
directors initially designated as Class I directors shall serve for a term
ending on the date of the year 2000 annual meeting, directors initially
designated as Class II directors shall serve for a term ending on the date of
the year 2001 annual meeting, and directors initially designated as Class III
directors shall serve for a term ending on the date of the year 2002 annual
meeting. Notwithstanding the foregoing, each director shall hold office until
such director's successor shall have been duly elected and qualified or until
such director's earlier death, resignation or removal. In the event of any
change in the number of directors, the Board of Directors shall apportion any
newly-created directorships among, or reduce the number of directorships in,
such class or classes as shall equalize, as nearly as may reasonably be
possible, the number of directors in each class. In no event will a decrease in
the number of directors shorten the term of any incumbent director.
 
          (4) Initial Directors. The names and mailing addresses of the persons
who are to serve initially as directors in each Class are:
 
 
                    Name                       Mailing Address
              -----------------             -----------------------
Class I       John T. Chain, Jr.            R. J. Reynolds Tobacco
              Thomas C. Wajnert             Holdings, Inc.
                                            401 North Main Street
                                            Winston-Salem, NC 27102
 
 
 
 
 
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<PAGE>
 
 
 
Class II      A. D. Frazier                 R. J. Reynolds Tobacco
              John G. Medlin, Jr.           Holdings, Inc.
              Nana Mensah                   401 North Main Street
                                            Winston-Salem, NC 27102
 
 
Class III     Denise Ilitch                 R. J. Reynolds Tobacco
              Andrew J. Schindler           Holdings, Inc.
              Joseph P. Viviano             401 North Main Street
                                            Winston-Salem, NC 27102
 
         (5) There shall be no cumulative voting in the election of directors.
Election of directors need not be by written ballot unless the By-Laws of the
Corporation so provide. Directors need not be stockholders.
 
         (6) Except as otherwise provided by law, vacancies on the Board of
Directors resulting from death, resignation, removal or otherwise and
newly-created directorships resulting from any increase in the number of
directors shall be filled only by a majority of the directors then in office
(although less than a quorum) or by the sole remaining director and not by the
stockholders, and each director so elected shall hold office for a term that
shall coincide with the term of the Class to which such director shall have been
elected.
 
         (7) Each member of the Board of Directors shall have one vote on all
matters presented to the Board of Directors, and a majority of the total number
of directors at any time shall constitute a quorum for the transaction of
business at that time. The Board of Directors may act by the unanimous written
consent of the directors.
 
         (8) Notwithstanding the foregoing, whenever the holders of one or more
classes or series of Preferred Stock shall have the right, voting separately as
a class or series, to elect directors, the election, term of office, filling of
vacancies, removal and other features of such directorships shall be governed by
the terms of the resolution or resolutions adopted by the Board of Directors
pursuant to ARTICLE FOURTH applicable thereto, and such directors so elected
shall not be subject to the provisions of this ARTICLE SIXTH unless otherwise
provided in such resolution or resolutions.
 
                                 ARTICLE SEVENTH
 
          (1) To the fullest extent permitted by the DGCL as now in effect or as
hereafter amended, no director or Continuing Director of the Corporation shall
be liable for monetary damages for breach of fiduciary duty.
 
 
 
 
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          (2) Each person who is or was a director or officer of the Corporation
(and the heirs, executors or administrators of such person) who was or is a
party or is threatened to be made a party to, or is involved in any threatened,
pending or completed action, suit or proceeding (including an action, suit or
proceeding by or in right of the Corporation), whether civil, criminal,
administrative or investigative, by reason of the fact that such person is or
was a director or officer, of the Corporation or is or was serving at the
request of the Corporation as a director or officer of another corporation,
partnership, joint venture, trust or other enterprise, shall be indemnified and
held harmless by the Corporation to the fullest extent permitted by the DGCL.
The right to indemnification conferred in this ARTICLE SEVENTH shall also
include the right to be paid by the Corporation the expenses incurred in
connection with any such proceeding in advance of its final disposition to the
fullest extent authorized by the DGCL. The right to indemnification conferred in
this ARTICLE SEVENTH shall be a contract right.
 
          (3) The Corporation may, by action of its Board of Directors, provide
indemnification to such of the employees and agents of the Corporation to such
extent and to such effect as the Board of Directors shall determine to be
appropriate and authorized by the DGCL.
 
          (4) The Corporation shall have power to purchase and maintain
insurance, at its expense, on behalf of any person who is or was a director,
officer, employee or agent of the Corporation, or is or was serving at the
request of the Corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against any
expense, liability or loss incurred by such person in any such capacity or
arising out of his status as such, whether or not the Corporation would have the
power to indemnify such person in any such capacity and whether or not the
Corporation would have the power to indemnify such person against such expense,
liability or loss under the DGCL.
 
          (5) The rights and authority conferred in this ARTICLE SEVENTH shall
not be exclusive of any other right which any person may otherwise have or
hereafter acquire under any statute, provision of the Certificate of
Incorporation or By-laws of the Corporation, agreement, vote of stockholders or
disinterested directors or otherwise.
 
          (6) Neither the amendment nor repeal of this ARTICLE SEVENTH, nor the
adoption of any provision of this Certificate of Incorporation or the By-laws of
the Corporation, nor, to the fullest extent permitted by the DGCL, any
modification of law, shall eliminate or reduce the effect of this ARTICLE
 
 
 
 
                                       13
 
<PAGE>
 
 
 
SEVENTH in respect of any acts or omissions occurring prior to such amendment,
repeal, adoption or modification.
 
                                 ARTICLE EIGHTH
 
         Any action required or permitted to be taken at any annual or special
meeting of stockholders may be taken only upon the vote of stockholders at an
annual or special meeting duly noticed and called in accordance with the DGCL
and may not be taken by written consent of stockholders without a meeting.
 
                                  ARTICLE NINTH
 
         Special meetings of the stockholders may be called by the Board of
Directors, the Chairman of the Board of Directors, the President or the
Secretary of the Corporation and may not be called by any other person.
Notwithstanding the foregoing, whenever holders of one or more classes or series
of Preferred Stock shall have the right, voting separately as a class or series,
to elect directors, such holders may call, pursuant to the terms of the
resolution or resolutions adopted by the Board of Directors pursuant to ARTICLE
FOURTH hereof, special meetings of holders of such Preferred Stock.
 
 
 
 
 
 
 
 
                                       14
 
<PAGE>
 
 
         IN WITNESS WHEREOF, the undersigned has duly executed this Restated
Certificate of Incorporation as of June 14, 1999.
 
 
                                       R.J. REYNOLDS TOBACCO HOLDINGS,
                                       INC.
 
 
                                       By: /s/ H. Colin McBride
                                           ----------------------------
                                           Name: H. Colin McBride
                                           Title: Senior Vice President,
                                                  Secretary and General Counsel