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RJ Reynolds

Notice of Annual Meeting and Proxy Statement.

Date: 28 Apr 1982
Length: 62 pages
506775533-506775594
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CORPORATE
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5532 -5594
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Executive
Christopher Fh Jr
Executive Vp
Referenced Document
Internal Revenue Code, (540000). Federal Social Security Act. Securities Exchange Act, (340000). Securities Act, (330000). Erisa. Fund Agreement. Securities Act of 1974 (740000). Employee Retirement Income Security Act of 1974 (740000). Federal Insurance
Date Loaded
27 Feb 1998
Request
1rfp5
Minnesota
1rfp4
Named Person
Rjr
Hanley, J.W.
Abely, J.F. Jr
Rjr Nabisco
Ncr
Anderson, W.S.
Butler, A.L.
Arista
Cudd, H.H.
Standard Oil
Grierson, R.H.
General Electric
Monsanto
Horrigan, E.A. Jr
Hull, J.W.
Pacific Telephone & Telegraph
Jordan, V.E. Jr
Akin Gump
Kreps, J.M.
Landis, R.G.
Macomber, J.D.
Celanese
Roemer, H.C.
Sticht, J.P.
Stokes, C.
Wilson, J.T.
Wilson, M.S.
Scarbroughs Stores
Del Monte
Eastman
Ny Life Insurance
Chase Manhattan Bank
Citibank
Nc Natl Bank
Crocker Natl Bank
Citicorp
Ncnb
Sea Land Industries
Sea Land Industries Investments
Paringer Investments
Wachovia Bank & Trust
Sg Warburg & Co
Chubb
Ernst & Whinney
Ernst & Ernst
Gilbert, L.D.
Gilbert, J.J.
Elia, C.J.
Wall Street
Province, O.F. St Joseph, O.F. The Capuch
Premonstratensian Fathers
Sisters, O.F. The Sorrowful Mother Fin
Who
Ny Stock Exchange
Crocker Natl
Author
Rjr Nabisco
Box
Rjr2445
UCSF Legacy ID
bti44d00

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Page 1: bti44d00
TABLE OF CONTENTS Page General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I Item 1 - ELECTION OF DIRECTORS .............................. 2 Information Concerning the Board of Directors .............. 8 Remuneration . 9 ...... ....... . ..... Transactions with Management and Others ................. 11 Stock Option and Other Plans .................................... 11 Stock Option Table .......................................... 12 Phantom Share Accounts Table ................................ 14 Retirement Plans ............................................ :... 14 Ownership of the Company's Securities ............................. 16 Item 2-RATlFICATION OF APPOINTMENT OF AUDITORS ........... 17 Item 3-EMPLOYEES' SAVINGS AND INVESTMENT PLAN ........... 17 General . ...............:...................... 17 Member Contributions ...... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Company Contributions .................................. 18 Investment of Contributions .............................. 18 Withdrawals and Distributions ............................ 18 Termination and Amendment .................... . . . . . . . . . 18 Tax Consequences ....................................... 18 Stockholder Approval ................................... 19 Item 4-STOCK BONUS PLAN ................................... 19 General 19 Company Contributions .................................. 19 Allocation of Company Contributions ...................... 19 Investment of Contributions .............................. 20 Withdrawals and Distributions ............................ 20 Termination and Amendment ............................. 20 Tax Consequences ...................................... 20 Stockholder Approval ................................... 20 Item 5-1982 LONG TERM INCENTIVE PLAN ....................... 20 General ............................................... 21 Awards ................................................ 21 Participants ............................................ 22 Adjustments ........................................... 22 Termination and Amendment ............................. 22 Tax Consequences ...................................... 23 Stockholder Approval ................................... 24 Item 6- STOCKHOLDER PROPOSAL CONCERNING CUMULATIVE VOT- ING IN THE ELECTION OF DIRECTORS .................... 24 Item 7-STOCKHOLDER PROPOSAL CONCERNING PREEMPTIVE RIG HTS ............................................... 25 Item 8-STOCKHOLDER PROPOSAL CONCERNING CIGARETTE PRO- MOTIONS IN THIRD WORLD NATIONS .................... 26 Miscellaneous .................................................. 28 EXHIBIT A - Empioyees' Savings and Investment Plan .............. A-1 EXHIBIT B- Stock Bonus Plan ................................... B-1 EXHIBIT C -1982 Long Term Incentive Plan ....................... C-1
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R.J.Reynolds Indus#ries, Inc. 'Pl~n :,cn-Salern,N.C 27102 March 17, 1982 PROXY STATEMENT GENERAL INFORMATION The accompanying proxy is solicited by the Board of Directors of the Company. All shares repre- sented by duly furnished proxies will be voted in accordance therewith. A stockholder furnishing the accompanying proxy may revoke it any time prior to the voting of the proxy. Solicitation may be made personally, by telephone, by telegraph or by mail by officers and employees of the Company who will not be additionally compensated therefor. The Company will request persons, such as brokers, nominees and fiduciaries, holding stock in their names for others, or holding stock for others who have the right to give voting instructions, to forward proxy material to their principals and request authority for the execution of the proxy and wi&eimburse such persons for their expenses In so doing. Georgeson & Co. has been retained to assist in7the solicitation of proxies at a cost not expected to exceed $14,500. The total cost of soliciting proxies will be borne by the Company. As of the close of business on March 3, 1982 there were outstanding and entitled to vote 104,381,024 shares of Common Stock, 274,969 shares of $2.25 Convertibie Preferred Stock and 7,053,478 shares of Series A Cumulative Preferred Stock. Holders of Common Stock, $2.25 Convertible Preferred Stock and Series A Cumulative Preferred Stock of record as of the close of business on March 3, 1982 will be entitled to vote on matters submitted to a vote at the meeting. Each share of Common Stock is entitled to one vote on all matters submitted at the meeting; each share of $2.25 Convertible Preferred Stock Is entitled to one-half vote on all matters submitted at the meeting; and each share of Series A Cumulative Preferred Stock is entitled to three-fourths vote on all matters submitted at the meeting. 1
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VERNON E. JORDAN, JR., 46, Partner, Akin, Gump, Strauss, Hauer & Feld. Mr. Jordan joined the law firm of Akin, Gump, Strauss, Hauer & Feld of Washington, D. C., and Dallas, Texas, as a Partner on January 1, 1982. Prior to this association, he served for ten years as President of the National Urban League, inc., a non-profit community service organization. Mr. Jordan is a Director of American Express Company, Bankers Trust Company, Bankers Trust New York Corporation, Celanese Corporation, J. C. Penney Company, Inc., Xerox Corporation and Dow Jones & Co. He also serves on the Board of Directors of Atlanta University Center Corporation, Clark College, the John Hay Whitney Foundation, the Rockefeller Foundation and the Taconic Foundation. He has served as a member of the National Advisory Commission on Selective Service, the American Revolution Bi-Centennial Commission, the Presidential Clemency Board and the Advisory Council on Social Security. Mr. Jordan Is a graduate of DePauw University and Howard University Law School. He is a member of the bar of the States of Arkansas and Georgia and is a member of the American Bar Association and the National Bar Association. Member: Audit Committee First became a Director: 1980 Public Policy Committee Shares owned: Common, 100 JUANITA M. KREPS, 61, former Secretary of Commerce. Dr. Kreps, who served as Secretary of Commerce from January 1977 to October 1979, was elected a Director of the Company on November 15, 1979. She previously served as a Director of the Company from April 1975 to January 1977, when she resigned to join the President's Cabinet. Dr. Kreps was Vice President of Duke University from 1973 to 1977 and James B. Duke Professor of Economics at Duke University from 1972 to 1977. She is the author of several leading books and articles In the field of economics. Dr. Kreps serves on the Board of Directors of American Telephone & Telegraph Company, Armco, Inc., Citicorp, Eastman Kodak Company, J. C. Penney Company, Inc., and UAL, Inc. She also serves as a Trustee of_thq&uke Endowment. Dr. Kreps holds a Ph.D. degree from Duke University. Member: Executive Committee First became a Director: 1975 Public Policy Committee Shares owned: Common, 276 R. G. LANDIS, 61, President-Pacific, R. J. Reynolds Industries, Inc. Mr. Landis was elected to this position in 1981. Prior to that time he was Chairman and Chief Executive Officer of Del Monte Corporation. Mr. Landis joined Del Monte, the principal business of which Is food prod- ucts and related services, in 1942. Following a leave of absence for Air Force service and graduate school, he rose through a succession of management positions that led to his election as a Vice President in 1966, Group Executive Vice President-U.S. Operations In 1969, President- Chief Operations Officer in 1971, President-Chief Executive Officer in 1977, Chairman of the Board in 1978, and Chairman and Chief Executive Officer In 1980. He has been a Director of Del Monte since 1970. Mr. Landis also serves on the Board of Directors of Crocker National Corporation, Crocker National Bank, Kaiser Foundation Health Plan, Inc., and Potlatch Corporation. He Is a Director of SRI International, Inc. and the California Roundtable, and a Trustee of the Tax Foundation, Inc. and the San Francisco Bay Area Council. Mr. Landis is also a Regent of the University of the Pacific and a Trustee of his alma mater, the University of La Verne. He is a member of the Advisory Council of the University of California School of Business Administration. Member: Public Policy Committee First became a Director: 1979 Shares owneds. s: Common, 19,6342 5
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ALBERT L. BUTLER, JR., 63, President, The Arista Company. Mr. Butler is also Treasurer and a member of the Board of Directors of The Arista Company which Is the holding company for Arista Information Systems, Inc., a Winston-Salem based data processing services bureau. He has been with The Arista Company (formerly Arista Mills Co.) since 1946. He is a member of the Board of Directors of The Wachovia Corporation, Wachovia Bank & Trust Company, N.A., Summit Communications, Inc., Standard Savings & Loan Association, Turnpike Properties, Inc., The Northwestern Mutual Life Insurance Co., Hayes-Albion Corporation and Wachovia Interna- tional Bank of New York. He Is a member of the Board of Visitors of the Medical Center of the Bowman Gray School of Medicine and a Director of the North Carolina Citizens Association. He Is also a Trustee of Wake Forest University. Mr. Butler is a graduate of Princeton University and holds an honorary Doctor of Laws degree from Wake Forest University. Member: Executive Committee First became a Director: 1976 Compensation Committee Shares owned: Common, 3,786 Finance Committee Nominating Committee HERSCHEL H. CUDD, 69, former Senior Vice President, Standard Oil Company (Indiana). From 1963 to 1974 Mr. Cudd served as President of Amoco Chemicals Corporation, a worldwide manu- facturer and marketer of chemicals and plastics and a subsidiary of Standard 011. He Is also a former Director of Standard Oil. Before joining Standard Oil In 1963, he was President of Avisun Corporation, then jointly owned by American Viscose Corporation and Sun Oil Company. From 1954 to 1960 he was a Vice President of American Viscose. Earlier he had been Director of the Engineering Experiment Station of Georgia Institute of Technology and a Division Manager for West Point Manufacturing Company, and held research management positions with Inter- national Minerals and Chemical Corporation and E. I. du Pont de Nemours & Company. Mr. Cudd is an Honorary Life Trustee of the Museum of Science and Industry in Chicago. He has served twice as a Director of the Manufacturing Chemists Association and hasperved on its executive committee. Mr. Cudd is a graduate of Texas A & I University and received master's and doctor's degrees in chemistry from the University of Texas. Member: Executive Committee First became a Director: 1974 Audit Committee Shares owned: Common, 1,176 Compensation Committee RONALD H. GRIERSON, 60, Director, The General Electric Company Ltd. (Great Britain). Mr. Grierson began his career on the editorial staff of "The Economist". After a short period of service in this position, he entered the private banking firm of S. G. Warburg & Co. Ltd. In 1948 and In 1958 became its Executive Director. He resigned that position in 1966 on being appointed Deputy Chairman and Managing Director of the government-sponsored Industrial Reorganization Corporation. In 1968 he became Vice Chairman of the General Electric Company, a British manufacturer of electrical products. In January 1973 Mr. Grierson gave up all business appoint- ments to assume the position of Director General for Industry and Technology at the European Commission in Brussels. In October 1974 he resumed his directorship of General Electric Company and subsequently became Chairman of its U.S. subsidiary, G.E.C. (America) Inc. He was appointed to the Company's International Advisory Board In 1975. Mr. Grierson is also a Director of S. G. Warburg & Co. Ltd. and a Director and Vice Chairman of Its U.S. associates, Warburg Paribas Becker Inc. and A. G. Becker & Co. Inc. He is also a Director of The Becker and Warburg-Paribas Group Incorporated, S. G. Warburg-North America Ltd. and Safic-Alcan & Cie (Paris). He is the Chairman of the Philharmonia Trust and of the European Foundation for Cancer Treatment Research and is a member of the Ernst von Siemens Music Foundation. Mr. Grierson holds a Master of Arts degree from Oxford University. Member: Finance Committee First became a Director: 1978 Audit Committee Shares owned: Common, 1,000 3
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Item 1- ELECTION OF DIRECTORS A board of seventeen Directors, to hold office until their successors have been elected and qualified, is to be elected at the meeting. It is intended that, unless authorization to do so is withheld, the proxies will be voted for the election of the nominees named below. If any nominee shall become unable to stand for election as Director at the meeting, an event not now anticipated by the Board of Directors, the proxy will be voted for such substitute as shall be designated by the Board of Directors. The Board of Directors' nominees for election as Directors are listed on the following pages with brief statements of their principal occupations and other information. Where the year given in which a nominee first became a Director is prior to 1970, it is the year in -which the nominee first became a Director of R. J. Reynolds Tobacco Company, of which the Company became the parent in a reorganization in 1970. All of the Board of Directors' nominees were elected by the stockholders to their present terms at the annual meeting in 1981 except Mr. Hanley. Mr. Hanley is a nominee for the first time and became a Director on Juiy 16, 1981. Nominees for Directors' JOSEPH F. ABELY, JR., 53, Vice Chairman of the Board and Chairman of the Finance Committee, R. J. Reynolds tndustries, Inc. Mr. Abely joined the Company in 1977. Previously, he was Vice Chairman and a Director of General Foods Corporation and also served that company as Presi- dent of its Food Service Products Division. Prior to 1963, Mr. Abeiy held various operating and financial positions with W. R. Grace & Co. He currently serves on the Board of Directors of Burlington Industries, Inc., Stauffer Chemical Company, Richardson-Vicks Inc., NCNB Corpora- tion and North Carolina National Bank. Mr. Abely also serves as a Governor of the American Red Cross. He is a member of the Council on Foreign Relations and the Emergency Committee for American Trade. He is President of the Southeastern Center for Contemporary Art and a member of the national Business Committee for the Arts. Mr. Abely is a member of the Board of Visitors of the Fuqua School of Business at Duke University and a trustee of Boston College and The Summit School. He is a graduate of Boston College and holds a Master of Business Administration degree from Harvard Graduate School of Business Administration and a Juris Doctor from Harvard Law School. He Is a member of the bar of the Com- monwealth of Massachusetts. Member: Executive Committee First became a Director: 1977 Finance Committee Shares owned: Common, 3,7702 WILLIAM S. ANDERSON, 62, Chairman of the Board, NCR Corporation. Mr. Anderson has served since 1972 as a Director of NCR Corporation which Is primarily engaged In the development, manufacturing, marketing and servicing of business equipment. Mr. Anderson has had a long career with NCR, beginning as Manager of its Hong Kong operation in 1946. He was elected Corporate President in 1972, Chief Executive Officer in 1973, Chairman and President in 1974, and Chairman of the Board in 1976. He is a Director of Consolidated Natural Gas Co., Chairman of the National Foreign Trade Council, a member and past Chairman of the National Board of the Smithsonian Associates, and Vice Chairman of the Advisory Council on Japan-U.S. Economic Relations. He is a Trustee of The Conference Board, and a member of The Business Council and the SRI Council. He also serves on the International Council of Morgan Guaranty Trust Company. Mr. Anderson is a graduate of Public and Thomas Hanbury School, Shanghai. Member: Compensation Committee First became a Director: 1977 Finance Committee Shares owned: Common, 200 Ln Nominating Committee 0 J J 2
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JOHN W. HANLEY, 60, Chairman of the Board and Chief Executive Officer, Monsanto Company. in 1972 Mr. Hanley was elected President, Chief Executive Officer and a Director of Monsanto Company, a multinational corporation engaged in the manufacture and sale of a widely diversified line of chemicals, plastics, fibers and other products. Prior to joining Monsanto, he served In The Procter & Gamble Company, rising to Executive Vice President and Director. Mr. Hanley is a Director of Citicorp, Citibank, N.A. and The May Department Stores Company. He is also a Trustee of the Conference Board and Washington University (St. Louis). He is a member of The Business Council and The Business Roundtable. Mr. Hanley is a graduate of Pennsylvania State University from which ha, received the Distinguished Alumnus Award. He also holds a masters degree from Harvard Graduate School of Business Administration and four honorary doctorates. First became a Director: 1981 Shares owned: Common, 400 EDWARD A. HORRIGAN, JR., 52, Executive Vice President, R. J. Reynolds Industries, Inc. and Chairman and Chief Executive Officer, R. J. Reynolds Tobacco Company. Mr. Horrigan joined the Company in July 1978 as Chairman and Chief Executive Officer of R. J. Reynolds Tobacco International, Inc. He was elected to the Board of Directors of R. J. Reynolds Tobacco Company In April 1979 and was elected President, Chairman and Chief Executive Officer of R. J. Reynolds Tobacco Company in February 1_980._Mr.:Horrigan was elected Executive Vice President of the Company in September 1981 Immediately prior to joinin nolds Tobacco International R J Re y,~ . g , . . y ~~ Inc he served as Chairman of the Board d Pr id t ki f B h ti idi C b ., an en es o uc ng am orpora on, a su ary s of Northwest Industries, Inc. He was associated with Thomas J. Lipton, Inc. from 1961 to 1973, where he rose to Division Vice President. Mr. Horrigan was General Manager of Ebonite Company from 1958 to 1961, having begun his career In 1954 as a Unit Sales Manager for The Procter & Gamble Company. Mr. Horrigan is a Director of the Northwest Region Board of Wachovia Bank & Trust Company, N.A. and the Tobacco institute and is a member of the Board of Visitors of the University of Connecticut's School of Business Administration. He serves on the International Committee on Smoking Issues. He also serves as a Trustee of Salem Academy and College and as a Director of the Winston-Salem Foundation. Mr. Horrigan Is a graduate of the University of Connecticut from which he received the Distinguished Alumnus Award. First became a Director: 1981 Shares owned: Common, 1,3302 JEROME W. HULL, 69, Retired Chairman of the Board, The Pacific Telephone and Telegraph Company. Mr. Hull began his career with The Pacific Telephone and Telegraph Company in 1935 in Los Angeles. He held various positions with Pacific Telephone and in 1959 became an Assistant Vice President of American Telephone and Telegraph Company in New York. He later returned to Pacific Telephone in San Francisco and in 1960 was appointed a Vice President and General Manager. He became Vice President-Operations in 1962; Executive Vice President In 1966; President In 1968 and Chairman of the Board in 1975. He retired in 1977 from his position as Chairman of the Board and in 1980 from his position as a Director of Pacific Telephone. Mr. Hull Is a Director of Ampex Corporation, Carter Hawley Hale Stores, Inc., Crocker National Bank, Crocker National Corporation, Del Monte Corporation, New York Life Insurance Company, Pacific Southwest Airlines and Wolff Manufacturing Company. He is a Director of the San Francisco Opera Association and a Trustee of Occidental College in Los Angeles, of which he Is a graduate. . Member: Audit Committee First became a Director: 1979 ut Finance Committee Shares owned: Common, 400 0 ~ v J UI 4 Ln w J
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COLIN STOKES, 67, Retired Chairman of the Board, R. J. Reynolds industries, Inc. Mr. Stokes joined R. J. Reynolds Tobacco Company in 1935 where he rose through successive supervisory and management positions to the office of Chairman of the Board in 1970. He was elected President of the Company in 1972 and Chairman and Chief Executive Officer In 1973, serving in the latter position until 1978. Mr. Stokes retired as Chairman of the Board in 1979. Mr. Stokes is a Director of NCNB Corporation, North Carolina National Bank and Home Federal Savings and Loan Association. He is a senior member of The Conference Board. He is Vice Chairman of the North Carolina State Ports Authority. Mr. Stokes serves on the University of North Carolina at Chapel Hill Institutional Development Foundation, the Medical Foundation and Board of Visitors of the Medical Center of the Bowman Gray School of Medicine and the Tanglewood Park Board of Trustees. Mr. Stokes is a graduate of the University of North Carolina and holds an honorary Doctor of Laws degree from Wake Forest University. Member: Executive Committee First became a Director: 1957 Compensation Committee Shares owneds: Common, 46,1864 Public Policy Committee J. TYLEE WILSON, 50, President, R. J. Reynolds Industries, Inc. Mr. Wilson joined the Company in 1974 as President of RJR Foods, Inc. He was elected President of R. J. Reynolds Tobacco internationai, Inc. in January 1976 and became Chairmarl of the Board and Chief Executive Officer in May 1976, serving in that position until July 1978. Mr. Wilson was elected Executive Vice President of the Company in 1976 and was elected President in 1979. Before joining the Com- pany, Mr. Wilson was with Chesebrough-Pond's Inc. where he served in various management positions ultimately leading to his election as Group Vice President and Director. Before joining Chesebrough-Pond's, Mr. Wilson spent his professional career in sales management with The Procter & Gamble Company and Scott Paper Company. He is a Director of The Firestone Tire & Rubber Company, Sonoco Products Company, The Wachovia Corporation, Wachovia Bank & Trust Company, N.A., the Research Triangle Foundation of North Carolina, the Metropolitan YMCA of Winston-Salem and Forsyth County, and Reynolda House. He is a Trustee of the United States Coundoof the International Chamber of Commerce, Inc., a member of the Board of Visitors of Wake Forest University and Chairman of the Governor's Business Council on the Arts and Humanities. He is also Chairman of the International Trade Subcommittee and a member of the International Policy Committee of the Chamber of Commerce of the United States. Mr. Wilson is a Trustee of Lafayette College of which he is a graduate. Member: Executive Committee First became a Director: 1976 Finance Committee Shares owneds: Common, 8,6902 MARGARET S. WILSON, 51, Chairman and Chief Executive Officer, Scarbroughs Stores. Mrs. Wilson joined Scarbroughs. a department store group in Austin, Texas, in 1952 as a department manager. In 1965 she became President and Chief Executive Officer and assumed her current position in 1974. She is also a Director of Scarbroughs. She serves as a Director of the Federal Reserve Bank of Dallas, the National Retail Merchants Association, the American Retail Federa- tion and the National Committee of U.S: China Relations. She is a Board member of the United States Chamber of Commerce and is a senior member of The Conference Board. She is also a Trustee of the Committee for Economic Development and the Institute for Aerobics Research. Mrs. Wilson is a graduate of the University of Texas. Member: Audit Committee First became a Director: 1978 Shares owned: Common, 429 7
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' Shareholdings given are the number of shares beneficially owned directly or indirectly by each nominee as of February 12, 1982. The number includes shares credited to an individual's account in trusts established under the Company's Employees' Stock Purchase Plan, Stock Bonus Plan, Employees' Savings and Investment Plan as well as the Del Monte Savings-Investment Plan and the Profit Sharing Incentive Plan of R. J. Reynolds Tobacco Company. Contributions to the last trust were discontinued after 1969. As of February 12, 1982, all officers and Directors owned beneficially 167,119 shares of Common Stock, 200 shares of $2.25 Convertible Preferred Stock and 3,339 shares of Series A Cumulative Preferred Stock, representing less than 1┬░lo of the. outstanding shares of each class, respectively. 2 The number of shares of Common Stock shown does not include shares subject to stock options granted by the Company which are exercisable currently or within 60 days. The following Is the number of options held by the listed nominee: Joseph F. Abely, Jr. - 24,274; Edward A. Horrigan, Jr. - 6,705; R. G. Landis - 4,118; H. C. Roemer - 13,420; J. Paul Sticht - 105,500; and J. Tylee Wilson -13,937. Directors and officers of the Company have the right to acquire 196,420 shares of Common Stock currently or within 60 days pursuant to options granted by the Company. 3 Includes 2,194 shares of Common Stock held in three trusts in which Mr. Sticht has a reversionary interest. 4 Excludes 9,230 shares of Common Stock in trusts of which Mr. Stokes is the income beneficiary and as to which he disclaims beneficial ownership. G The number of shares of Common Stock listed after the name of each of the following nominees was held in the name of the wife, minor children or other relatives sharing the home of such nominee: R. G. Landis, 1,000 shares; J. Paul Sticht, 3,000 shares; Colin Stokes, 2,660 shares; H. C. Roemer, 100 shares; and J. Tylee Wilson, 402 shares. In addition, 3,100 shares of Series A Cumulative Preferred Stock were held in the name of Mr. Landis' wife, minor children or other relatives sharing his home. Each of these nominees has advised the Company that he disclaims any beneficial ownership of such shares. 6 Mr. Landis also owns 239 shares of Series A Cumulative Preferred Stock and Mr. Roemer also owns 200 shares of $2.25 Convertible Preferred Stock. Certain Information Concerning the Board of Directors During 1981 twelve meetings of the Board of Directors were held. Each Director attended more than 75% of the meetings of the Board of Directors and the committees on which he or she served combined, except for two Directors. Mr. Hull attended 73% of the combined total of such meetings. Mr. Hanley, since his election in July, has attended 60% of the meetings of the Board of Directors. Among the standing committees of the Board of Directors of the Company are the Audit, Compensa- tion and Nominating Committees. The duties performed by the Audit Committee include recommending to the Board of Directors the independent auditors to be employed by the Company; conferring with the independent auditors and the internal auditors concerning the scope of their examination of the books and records of the Company and its subsidiaries; reviewing with the independent and internal auditors, on completion of their audits, their findings and recommendations; reviewing the range and cost of audit and non-audit services performed by the independent auditors; reviewing the independent auditors' opinion rendered with respect to the annual financial statements; reviewing the adequacy of the Company's system of internal accounting controls; reviewing and approving budgeted and actual audit costs of the independent 8
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JOHN D. MACOMBER, 54, Chairman of the Board and Chief Executive Officer, Celanese Corpo- ration. In 1973 Mr. Macomber was elected President and Director of Celanese Corporation, a multinational producer of petrochemicals, fibers, plastics, coatings and specialty chemicals. He was named its Chief Executive Officer In 1977 and its Chairman of the Board In 1980. Before joining Celanese, Mr. Macomber had been associated for 20 years with McKinsey & Company, management consultants, serving as a Director from 1964 to 1973 and as a member of its Managing Committee. He is a Director of The Chase Manhattan Bank, N.A. and Bristol-Myers Company. He is Director and Vice Chairman of the New York Philharmonic Orchestra and a Director of Lincoln Center for the Performing Arts. He is a Trustee of the Carnegie Institution of Washington, the Economic Club, the New York Zoological Society and the United States Council of the International Chamber of Commerce. Mr. Macomber is Vli:e, Chairman of The Americas Society, the Center for Inter-American Relations and the Council of the Americas. He is a member of the Business Roundtable and the Council on Foreign Relations. Mr. Macomber is a graduate of Yale University and of Harvard Graduate School of Business Administration. Member: Compensation Committee First became a Director: 1975 Finance Committee Shares owned: Common, 626 Nominating Committee H. C. ROEMER, 57, Senior Vice President, General Counsel and Secretary, R. J. Reynolds Indus- tries, Inc. Mr. Roemer joined R. J. Reynolds Tobacco Company In 1958 as Associate Counsel. He was made Assistant General Counsel In 1968, and In 1970 he was elected Secretary and a Director. He was elected a Vice President and General Counsel of the Company In 1970 and Senior Vice President and Secretary In 1979. Prior to Joining R. J. Reynolds Tobacco Company, Mr. Roemer was associated with the law firm of Davis Polk & Wardweli of New York. He is a member of the Board of Governors of the North Carolina Bar Association and of Its Corporate '1 Counsei and Finance committees Mr Roemer is also a member of The American Law In titute . . s , _.~s~~ ~ ~ _ the Association of General Counsel, the American Bar Association, the Committee on Trans- a nationat Corporations of the World Association of Lawyers and( the Advisory Board of the International & Comparative Law Center of the Southwestern Legal Foundation. We serves on the Board of Visitors of Wake Forest University School of Law and is a Trustee of Salem Academy and College. Mr. Roemer is a graduate of Harvard College and Columbia University Law School. He Is a member of the bar of the States of New York and North Carolina. Member: Executive Committee First became a Director: 1970 Shares owneds. 6: Common, 1,5592 J. PAUL STICHT, 64, Chairman of the Board and Chief Executive Officer, R. J. Reynolds Indus- tries, Inc. Mr. Sticht became a Director of the Company in 1968 and was elected Chairman of the Executive Committee In 1972. In 1973 he became President and Chief Operating Officer and In 1978 he was elected Chief Executive Officer of the Company. Mr. Sticht was elected Chairman of the Board In April 1979. Before joining the Company, Mr. Sticht was President of Federated Department Stores, Inc. He joined Federated in 1960 as an Executive Vice President and Director and became President In 1967. Previously, he was a Vice President of Campbell Soup Company and President of Campbell's.Interrmational subsidiary. Earlier in his career he held various positions with United States Steel Corporation and Trans World Airlines, Inc. Mr. Sticht is a member of the Board of Directors of Celanese Corporation, The Wachovia Corporation, Wachovia Bank & Trust Company, N.A., Foremost-McKesson, Inc., S. C. Johnson & Son, Inc. and Chrysler Corporation. He is a member of the Rockefeller University Board of Trustees and a member of the Massachusetts Institute of Technology Corporation. Mr. Sticht is a member of the Board of Governors of the Corporate Fund for the Performing Arts at Kennedy Center, the Council on Foreign Relations, Chamber of Commerce of the United States and The Business Roundtable. He also serves as Chairman of the North Carolina Council of Management and Development. Mr. Sticht is a graduate of Grove City College, from which he also holds an honorary doctor's degree. He serves on the College's Board of Trustees. Member: Executive Committee First became a Director: 1968 Finance Committee Shares owned5: Common, 28,5242,3 N Nominating Committee QO) -4 -4 6 (n N W (D
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auditors; and reviewing, when appropriate, investigations of matters within the scope of its duties. The Audit Committee held three meetings during 1981. The duties of the Compensation Committee include approving the salaries of officers of the Company and the Chairmen and Presidents of the Company's significant subsidiaries; reviewing the Company's wage and salary administration policies; reviewing, administering and interpreting executive incentive compensation plans and granting bonuses, options and benefits under such plans; approving individual transactions between the Company and executives or prospective executives which sig- nificantly affect the executive's benefits or remuneration; and reviewing and administering certain aspects of the Company's retirement and stock purchase plans. The Compensation Committee held seven meetings during 1981. The duties of the Nominating Committee include reviewing and recommending changes in the size and composition of the Company's Board of Directors and recommending candidates for election to the Board. The Nominating Committee considers recommendations from all sources, including stock- holders, regarding possible candidates. A stockholder, desiring to propose a candidate to the Nominating Committee, should submit a written recommendation, together with sufficient biographical information concerning the recommended individual, including age, employment and board memberships, if any, to the Secretary of the Company, R. J. Reynolds Industries, Inc., Reynolds Boulevard, Winston-Salem, North Carolina 27102. While letters of recommendation may be submitted for consideration at any time, recommendations must be received prior to December 15 in any. year for consideration in connection with the nomination and election of Directors at the Company's next annual meeting. The Nominating Committee held three meetings during 1981. Each Director who is not an employee of the Company or a subsidiary is compensated at the rate of $1,500 per month. In addition, each is paid a fee of $500 for a regular or annual meeting of the Board, $600 for a special meeting of the Board or for a committee meeting not held on the same day as a Board meeting, and $500 for a committee meeting held oethe same day as a Board meeting or for any stockholder meeting. Committee chairmen are paid 'an additional $200 for attendance at committee meetings. The Company pays no additional remuneration to employees of the Company or its subsidiaries who are Directors. The Company maintains a deferred compensation plan for Directors of the Company. This plan allows non-employee Directors to defer their fees under provisions substantially identical to the cash credit and stock credit deferral provisions of the Company's Management Incentive Plan described under "Stock Option and Other Plans" on page 13 of this proxy statement. The deferred amounts are credited with interest equivalents at a current long-term government bond rate. Accounts are distributed upon the participant's termination of service as a Director. The Company also maintains a retirement plan for Directors of the Company who are not and never have been employees of the Company. The plan provides each eligible Director who has served on the Board of Directors for five or more.years with a monthly allowance payable once his or her service as a Director ends. The amount of the allowance is equal to one-half of the basic monthly Director's fee in effect on the date the Director's service terminates. The allowance is payable until 120 monthly payments have been made, until the number of monthly payments made equals the number of months of service by the individual as a Director, or until the individual's death, whichever occurs first. Remuneration The following information is given as to the five most highly paid executive officers or Directors of the Company who received direct remuneration for 1981 from the Company and its subsidiaries of more than $50,000 and as to all officers and Directors of the Company as a group. 9

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