2003 Committee Charter : RJR

Compensation Committee

Mary K. Bush
John T. Chain, Jr.
E. V. (Rick) Goings
Joseph P. Viviano (Chair)


POWERS OF THE COMPENSATION COMMITTEE


RESOLVED, that the Compensation Committee shall have the power and authority to approve, adopt, amend, terminate and administer all plans or programs relating to employee benefits, incentives or compensation, including employment contracts, except that the Committee shall not have the power or authority to:
(1) adjust the salaries or determine annual incentive awards for the Chairman of the Board, the Chief Executive Officer and employees in salary grade "A"; or

(2) approve the adoption of or changes to plans or programs if the impact of such adoption or change would be to (a) decrease net income by more than $20,000,000 per year; (b) affect generally the terms and conditions under which management participates in the ownership of the common stock of R. J. Reynolds Tobacco Holdings, Inc. or (c) significantly change a plan or program afforded principally to executive management;

FURTHER RESOLVED, that the Compensation Committee shall have the power and authority to initiate and oversee annually the evaluation of the performance of the Chief Executive Officer, and shall have the responsibility for reviewing and reporting to the Board of Directors on succession planning for the Chief Executive Officer and other top executive management positions;

FURTHER RESOLVED, that the Compensation Committee shall report periodically to the Board of Directors on Committee activity, advise the Board with respect to the execution or amendment of any employment contract with one of the five most highly salaried members of management and review with the Board such other information as either the Chairman of the Committee or the Chairman of the Board deems appropriate;

FURTHER RESOLVED, that the Compensation Committee may delegate such of the foregoing powers and authorities as it deems appropriate to other committees it establishes or to the Chairman of the Board with powers of further delegation as such other committee or the Chairman of the Board may determine, except that the Chairman of the Board shall not have the power or authority to:

(1) approve salary adjustments or annual incentive awards for individuals in salary grades "A" or "B";

(2) approve the aggregate pool for the Annual Incentive Award Plan; or

(3) approve the adoption of or changes to plans or programs if the impact of such adoption or change would be to decrease net income by more than $10,000,000 per year;

FURTHER RESOLVED, that the Compensation Committee may delegate to the Chairman of the Compensation Committee the power and authority to approve salary adjustments or annual incentive awards for individuals in salary grade "B" or below when necessary for expediency and when the Committee is not otherwise in session; and

FURTHER RESOLVED, that the Compensation Committee shall consist solely of members of the Board who have never been employees of the Company or any of its subsidiaries. The Board shall determine the membership of the Compensation Committee, in its discretion, but the Compensation Committee shall always have at least three member directors.


Last amended September 22, 1999