Reynolds CEO Paid $10M in 2014

Source from:  Winston-Salem (NC) Journal 03/24/2015

Reynolds American Inc. welcomed Susan Cameron back as its top executive with $10.75 million m total compensation for seven months of work in fiscal 2014.

Cameron returned as chief executive and president May 1, in part to guide Reynolds through its proposed $27.4 billion purchase of Greensboro tobacco manufacturer Lorillard Inc. The deal awaits federal regulatory approval. The companies expected to get an answer from the Federal Trade Commission by June 30.

Cameron signed a two-year contract, with a mutual renewal, that set a full year base salary of $1.3 million. She also received a $500,000 "sign-on" bonus.

Cameron's pro-rated salary for 2014 was $904,111. She received no nonequity incentive plan compensation.

The bulk of her compensation was stock awards valued at $8.35 million on the date they were awarded.

Shealsoreceived$275,334inall other compensation that included: $91,471 in value for personal flights by her or guests on aircraft partly owned by the company;

$54,600 in a nonqualified excess benefit plan credit; $54,474 in the change of value in an accrued post-retirement benefit plan-reimbursement of $29,266 for financial planning services related to her former employment with Brown & Williamson Tobacco Corp; $16,900 in qualified benefit plan contribution; $13,444 in assistance for financial planning and counseling services.

By comparison, in Cameron's final full year with Reynolds before she retired in February 2011, she was paid $1.31 million in salary, $7.78 million in incentive pay and total compensation of $23.8 million.

For fiscal 2014, Reynolds' net income was down 14.4 percent to $1.47 billion. When excluding charges and gains, net income was up 4.9 percent to $1.83 billion.

Daniel Delen, who stepped down as chief executive and president in April, received $376,708 in salary and $13.68 million in all other compensation, of which $13.4 million was a lump-sum payment in June. Delen had stock awards valued at $7.71 million when on the date they were awarded.

Thomas Adams, chief financial officer, received a 2 percent raise in salary to $725,275, a 5.6 percent decrease in nonequity incentive-plan compensation to just more than $1 million, and an $850,000 employment retention bonus. The bonus was paid to Adams in January. He retired from the company Feb. 28.

Andrew Gilchrist, who served as an executive vice president in 2014, received a 12.7 percent raise in salary to $628,575, a 15 percent increase in incentive pay to $877,019 and an $80,000 special cash award. He took over as chief financial officer March 1.

Martin Holton III, general counsel, received an 8.6 percent raise in salary to $568,225, a 0.5 percent decrease in incentive pay to $749,844, and no bonus.

Debra Crew, president and chief commercial officer of Reynolds Tobacco, received $150,000 in salary, a $525,000 sign-on bonus, $213,203 in incentive pay and stock awards valued at $8.32 million on the date they were awarded. She took over both Reynolds management roles Oct. 1

The company set its annual shareholder meeting for 9 a.m. May 7 at its downtown Winston-Salem headquarters.

A shareholder proposal requests that the board authorize a report on the steps it is taking to reduce the risk of acute nicotine poisoning, also known as green tobacco sickness, for farmworkers in the company's supply chain.

The board recommends against the proposal, saying it already makes public, through audits, information t on its effort to reduce the risk of acute nicotine poisoning.

Another proposal wants Reynolds to create a policy verifying that suppliers' employees are not at risk of forced labor, such as having their pay withheld or their worker documents kept by their employer. They want Reynolds to insist that suppliers provide transparent contracts on terms of employment and work conditions.

The board recommends against the proposal, saying that either the proposals are "impractical and unenforceable" or that existing audits with its suppliers addresses these concerns.

Since 2005, all advocacy group proposals have been rejected by Reynolds shareholders.

However, the Farm Labor Organizing Committee's persistence with its proposals on farmworker safety issues since 2007, along with sidewalk demonstrations at Reynolds' headquarters, have paid some dividends.

In 2012, Reynolds' management agreed to form a multilateral council made up of other tobacco manufacturers, growers, advocacy groups and labor officials to address the issues.

In December, Reynolds and Altria Group Inc. confirmed their future contracts with tobacco growers, starting in 2015, will prohibit the hiring of anyone under age 16 to work in their fields.

Those ages 16 and 17 will be required to receive safety training and wear appropriate personal protective equipment, as well as provide written parental authorization prior to beginning employment. The policies will not apply to minors working on their family farms. Enditem