UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


 
FORM 6-K
 

 
REPORT OF FOREIGN PRIVATE ISSUER
Pursuant to Rule 13a-16 or 15d-16
under the Securities and Exchange Act of 1934
 
September 6, 2019
 
Commission File Number: 001-38159


 
BRITISH AMERICAN TOBACCO P.L.C.
(Translation of registrant’s name into English)


 
Globe House
4 Temple Place
London WC2R 2PG
United Kingdom
(Address of principal executive office)


 
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
 
Form 20-F               Form 40-F ☐
 
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):  ☐
 
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):  ☐
 
 


 



  
The information contained in this Form 6-K is incorporated by reference into the Company’s Form F-3 Registration Statement File No. 333-232691, and related Prospectus and Prospectus Supplements, as such Registration Statement, Prospectus and Prospectus Supplements may be amended from time to time.
 

EXHIBIT INDEX
 
Exhibit
 
Description
     
Exhibit 1.1
 
Underwriting Agreement, dated September 3, 2019, by and among B.A.T Capital Corporation, the Guarantors party thereto, and BofA Securities, Inc., Barclays Capital Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and HSBC Securities (USA) Inc.
Exhibit 4.1
 
Indenture, dated September 6, 2019, by and among B.A.T Capital Corporation, the Guarantors party thereto, and Citibank, N.A., as trustee, authentication agent, transfer agent, registrar, calculation agent and initial paying agent.
Exhibit 4.2
 
Supplemental Indenture No. 1, dated September 6, 2019, by and among B.A.T Capital Corporation, the Guarantors party thereto and Citibank, N.A., as Trustee.
Exhibit 4.3
 
Supplemental Indenture No. 2, dated September 6, 2019, by and among B.A.T Capital Corporation, the Guarantors party thereto and Citibank, N.A., as Trustee.
Exhibit 4.4
 
Supplemental Indenture No. 3, dated September 6, 2019, by and among B.A.T Capital Corporation, the Guarantors party thereto and Citibank, N.A., as Trustee.
Exhibit 4.5
 
Supplemental Indenture No. 4, dated September 6, 2019, by and among B.A.T Capital Corporation, the Guarantors party thereto and Citibank, N.A., as Trustee.
Exhibit 5.1
 
Opinion of Cravath, Swaine & Moore LLP.
Exhibit 5.2
 
Opinion of Linklaters LLP (London).
Exhibit 5.3
 
Opinion of Stibbe N.V.
Exhibit 5.4
  Opinion of Kilpatrick Townsend & Stockton LLP.
 
 
 
 
 

 



SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 
 
British American Tobacco p.l.c.
 
       
       
 
By:
/s/ Oliver Martin
 
    Name:  Oliver Martin  
    Title:    Assistant Secretary  
       
 
Date:  September 6, 2019







Exhibit 1.1




UNDERWRITING AGREEMENT

B.A.T CAPITAL CORPORATION

$1,000,000,000 2.789% Notes due 2024

$1,000,000,000 3.215% Notes due 2026

$500,000,000 3.462% Notes due 2029

$1,000,000,000 4.758% Notes due 2049

Fully and Unconditionally Guaranteed on a Senior Unsecured Basis

by

BRITISH AMERICAN TOBACCO P.L.C.

and

B.A.T. INTERNATIONAL FINANCE P.L.C.

and

B.A.T. NETHERLANDS FINANCE B.V.

and

REYNOLDS AMERICAN INC.



September 3, 2019





BofA Securities, Inc.

Barclays Capital Inc.

Citigroup Global Markets Inc.

Deutsche Bank Securities Inc.

HSBC Securities (USA) Inc.

As Representatives of the
several Underwriters listed
in Schedule 1 hereto

Ladies and Gentlemen:

B.A.T Capital Corporation, a Delaware corporation (the “Issuer”), proposes to issue and sell to the several underwriters listed in Schedule 1 hereto (the “Underwriters”), for whom you are acting as representatives (the “Representatives”), $1,000,000,000 aggregate principal amount of the Issuer’s 2.789% notes due 2024 (the “2024 Notes”), $1,000,000,000 aggregate principal amount of the Issuer’s 3.215% notes due 2026 (the “2026 Notes”), $500,000,000 aggregate principal amount of the Issuer’s 3.462% notes due 2029 (the “2029 Notes”) and $1,000,000,000 aggregate principal amount of the Issuer’s 4.758% notes due 2049 (the “2049 Notes” and, together with the 2024 Notes, 2026 Notes and 2029 Notes, the “Notes”) in the respective amounts set forth in Schedule 1 hereto.  The Notes will be entitled to the benefit of full and unconditional guarantees (the “Guarantees”), on a senior unsecured and joint and several basis, of the payment of all amounts owing with respect to the Notes by the Issuer, by British American Tobacco p.l.c., a public limited company incorporated under the laws of England and Wales (the “Parent”), B.A.T. International Finance p.l.c., a public limited company incorporated under the laws of England and Wales (“BATIF”), B.A.T. Netherlands Finance B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of The Netherlands (“BATNF”), and, unless its guarantee is released in accordance with the Indenture referred to below, Reynolds American Inc., a North Carolina corporation (“RAI”), each as a guarantor (together, the “Guarantors”).

The Notes will be issued pursuant to an indenture to be dated as of September 6, 2019 (the “Base Indenture”), among the Issuer, the Guarantors and Citibank, N.A., as trustee (the “Trustee”), and Citibank, N.A., as paying agent, transfer agent, registrar and calculation agent.  Certain terms of the Notes will be established pursuant to supplemental indentures (the “Supplemental Indentures”; together with the Base Indenture, the “Indenture”) to the Base Indenture or an officer’s certificate.

The Issuer and each Guarantor hereby confirms its agreement with the several Underwriters concerning the purchase and resale of the Notes, as follows:


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1.          Registration Statement.  The Issuer meets the requirements for use of Form F-3 under the Securities Act of 1933, as amended (the “Securities Act”) and has prepared and filed with the Securities and Exchange Commission (the “Commission”) an “automatic shelf registration statement” (as defined under Rule 405 under the Securities Act), on Form F-3 (File No. 333-232691) in respect of the Issuer’s debt securities and guarantees thereof.  Such registration statement, including the information, if any, deemed pursuant to Rule 430A, 430B or 430C under the Securities Act to be part of the registration statement at the time of its effectiveness (together, “Rule 430 Information”), is referred to herein as the “Registration Statement”.  As used herein, the term “Base Prospectus” means the prospectus included in such Registration Statement (and any amendments thereto) at the time of its effectiveness that omits Rule 430 Information.  The term “Preliminary Prospectus” means the Base Prospectus and any preliminary prospectus supplement specifically relating to the Notes and the offering thereof used prior to filing of the Prospectus (as defined below).  The term “Prospectus” means the Base Prospectus and the final prospectus supplement that amends or supplements the Base Prospectus in the form first used (or made available upon request of purchasers pursuant to Rule 173 under the Securities Act) in connection with confirmation of sales of the Notes.  Any reference in this underwriting agreement (this “Agreement”) to the Registration Statement, any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein pursuant to Item 6 of Form F-3 under the Securities Act, as of the effective date of the Registration Statement or the date of such Preliminary Prospectus or the Prospectus, as the case may be, any reference to “amend,” “amendment” or “supplement” with respect to the Registration Statement, any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any documents filed after such date under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and regulations of the Commission thereunder that are deemed to be incorporated by reference therein, and any reference to any amendment to the Registration Statement shall be deemed to refer to and include any annual report of the Parent filed pursuant to Section 13(a) or 15(d) of the Exchange Act after the effective date of the Registration Statement that is incorporated by reference in the Registration Statement and any filings by the Parent on Form 6-K the Parent deems incorporated by reference into the Registration Statement.  Capitalized terms used but not defined herein shall have the meanings given to such terms in the Registration Statement and the Prospectus.

At or prior to the time when sales of the Notes were first made (the “Time of Sale”), the Issuer prepared the following information (collectively, the “Time of Sale Information”): a Preliminary Prospectus and each “free-writing prospectus” (as defined pursuant to Rule 405 under the Securities Act) listed on Annex A hereto.

2.          Purchase and Sale of the Notes.  (a) The Issuer agrees to issue and sell the Notes to the several Underwriters as provided in this Agreement, and each Underwriter, on the basis of the representations, warranties and agreements set forth herein and subject to the conditions set forth herein, agrees, severally and not jointly, to purchase from the Issuer the respective principal amount of Notes set forth opposite such Underwriter’s name in Schedule 1 hereto at a price equal to (i) 99.650% of the principal amount of the 2024 Notes, (ii) 99.600% of the principal amount of the 2026 Notes, (iii) 99.550% of the principal amount of the 2029 Notes, and (iv) 99.125% of the principal amount of the 2049 Notes, in


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each case, plus accrued interest, if any, from September 6, 2019, to the Closing Date (as defined below).

(b)          The Issuer acknowledges and agrees that the Underwriters may offer and sell Notes to or through any affiliate of an Underwriter and that any such affiliate may offer and sell Notes purchased by it to or through any Underwriter.

(c)          The Issuer understands that the Underwriters intend to make a public offering of the Notes as soon after the effectiveness of this Agreement as in the judgment of the Representatives is advisable, and initially to offer the Notes on the terms set forth in the Time of Sale Information.

(d)          The Issuer and each Guarantor acknowledges and agrees that the Underwriters are acting solely in the capacity of an arm’s length contractual counterparty to the Issuer and each Guarantor with respect to the offering of the Notes contemplated hereby (including in connection with determining the terms of the offering) and not as financial advisors or fiduciaries to, or agents of, the Issuer, any Guarantor or any other person.  Additionally, neither the Representatives nor any other Underwriter are advising the Issuer, any Guarantor or any other person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction.  The Issuer and each Guarantor shall consult with its own advisors concerning such matters and shall be responsible for making its own independent investigation and appraisal of the transactions contemplated hereby, and neither the Representatives nor any other Underwriter shall have any responsibility or liability to the Issuer or any Guarantor with respect thereto.  Any review by the Representatives or any Underwriter of the Issuer, any Guarantor, and the transactions contemplated hereby or other matters relating to such transactions will be performed solely for the benefit of the Representatives or such Underwriter, as the case may be, and shall not be on behalf of the Issuer, any Guarantor or any other person.  The Issuer agrees that it will not claim that the Underwriters have rendered advisory services of any nature or respect, or owe an agency, fiduciary or similar duty to the Issuer, in connection with such transactions or the process leading thereto.

3.          Payment and Delivery.  (a) Payment for and delivery of the Notes will be made at the offices of Davis Polk & Wardwell London LLP, 5 Aldermanbury Square, London EC2V 7HR, at 9:00 A.M., New York City time, on September 6, 2019, or at such other time or place on the same or such other date, not later than the fifth business day thereafter, as the Representatives and the Issuer may agree upon in writing.  The time and date of such payment and delivery is referred to herein as the “Closing Date”.

(b)          The Notes will be represented by one or more global notes (collectively, the “Global Notes”) in book-entry form.  Payment for the Notes shall be made by wire transfer in immediately available funds to the account(s) specified by the Issuer to the Representatives against delivery of the Global Notes to the nominee of The Depository Trust Company (“DTC”), for the account of the Underwriters, with any transfer taxes payable in connection with the initial sale of the Notes duly paid by the Issuer.  The Global Notes will be made available for


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inspection by the Representatives not later than 5:00 P.M., New York City time, on the business day prior to the Closing Date.

4.           Representations and Warranties of the Issuer and the Guarantors.  The Issuer and each Guarantor jointly and severally represents and warrants to each Underwriter that:

(a)          Preliminary Prospectus.  No order preventing or suspending the use of any Preliminary Prospectus has been issued by the Commission, and each Preliminary Prospectus, at the time of filing thereof, complied in all material respects with the Securities Act and did not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Issuer and the Guarantors make no representation or warranty with respect to any statements or omissions made in reliance upon and in conformity with information relating to any Underwriter furnished to the Issuer or the Guarantors in writing by or on behalf of such Underwriter through the Representatives expressly for use in any Preliminary Prospectus.

(b)          Time of Sale Information.  The Time of Sale Information, at the Time of Sale, did not, and at the Closing Date, will not, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Issuer and the Guarantors make no representation or warranty with respect to any statements or omissions made in reliance upon and in conformity with information relating to any Underwriter furnished to the Issuer or the Guarantors in writing by or on behalf of such Underwriter through the Representatives expressly for use in the Preliminary Prospectus, the Time of Sale Information or the Prospectus.

(c)          Issuer Free Writing Prospectus.  Neither the Issuer nor any Guarantor (including their respective agents and representatives, other than the Underwriters in their capacity as such) has prepared, made, used, authorized, approved or referred to, nor will it prepare, make, use, authorize, approve or refer to, any “written communication” (as defined in Rule 405 under the Securities Act) that constitutes an offer to sell or solicitation of an offer to buy the Notes (each such communication by the Issuer, the Guarantors or their respective agents and representatives (other than a communication referred to in any of clauses (i), (ii), and (iii) below) an “Issuer Free Writing Prospectus”) other than (i) any document not constituting a prospectus pursuant to Section 2(a)(10)(a) of the Securities Act or Rule 134 under the Securities Act, (ii) the Preliminary Prospectus, (iii) the Prospectus, (iv) the documents listed on Annex A hereto, including the pricing term sheets substantially in the form of Annex B hereto, which constitute part of the Time of Sale Information, and (v) any electronic road show or other written communications, in each case approved in writing in advance by the Representatives.  Each such Issuer Free Writing Prospectus complies in all material respects with the Securities Act, has been or will be (within the time period


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specified in Rule 433) filed in accordance with the Securities Act (to the extent required thereby) and, when taken together with the Preliminary Prospectus filed prior to the first use of such Issuer Free Writing Prospectus, at the Time of Sale, did not, and at the Closing Date will not, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading and the information contained in each written communication under clause (v) does not conflict with the information either in the Time of Sale Information or the Prospectus; provided that the Issuer and the Guarantors make no representation or warranty with respect to any statements or omissions made in each such Issuer Free Writing Prospectus in reliance upon and in conformity with information relating to any Underwriter furnished to the Issuer or the Guarantors in writing by or on behalf of such Underwriter through the Representatives expressly for use in any Issuer Free Writing Prospectus.

(d)          Registration Statement and Prospectus.  The Registration Statement is an “automatic shelf registration statement” as defined under Rule 405 of the Securities Act that has been filed with the Commission not earlier than three years prior to the date hereof; and no notice of objection of the Commission to the use of such registration statement or any post-effective amendment thereto pursuant to Rule 401(g)(2) under the Securities Act has been received by the Issuer.  No order suspending the effectiveness of the Registration Statement has been issued by the Commission and no proceeding for that purpose or pursuant to Section 8A of the Securities Act against the Issuer or related to the offering has been initiated or threatened by the Commission; as of the applicable effective date of the Registration Statement and any amendment thereto, the Registration Statement complied and will comply in all material respects with the Securities Act and the Trust Indenture Act of 1939 (the “Trust Indenture Act”), as amended, and the rules and regulations of the Commission thereunder, and did not and will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading; and as of the date of the Prospectus and any amendment or supplement thereto and as of the Closing Date, the Prospectus will not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Issuer makes no representation or warranty with respect to (i) that part of the Registration Statement that constitutes the Statement of Eligibility and Qualification (Form T-1) of the Trustee under the Trust Indenture Act or (ii) any statements or omissions made in reliance upon and in conformity with information relating to any Underwriter furnished to the Issuer or the Guarantors in writing by or on behalf of such Underwriter through the Representatives expressly for use in the Registration Statement and the Prospectus and any amendment or supplement thereto.

(e)        Incorporated Documents.  The documents incorporated by reference in each of the Registration Statement, the Prospectus and the Time of Sale Information, when they became effective or were filed with the Commission, as the


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case may be, conformed in all material respects to the requirements of the Exchange Act, and none of such documents contained any untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; and any further documents so filed and incorporated by reference in the Registration Statement, the Prospectus or the Time of Sale Information, when such documents become effective or are filed with the Commission, as the case may be, will conform in all material respects to the requirements of the Securities Act or the Exchange Act, as applicable, and will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

(f)           Financial Statements.  The consolidated financial statements and the related notes thereto of the Parent included or incorporated by reference in each of the Registration Statement, the Time of Sale Information and the Prospectus comply with applicable requirements of the Securities Act, the Exchange Act and the rules and regulations of the Commission thereunder, and present a true and fair view of the consolidated financial position of the Parent and its subsidiaries, as of the dates indicated and the results of their operations and the changes in their cash flows for the periods specified; such consolidated financial statements have been prepared in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS-IASB”), International Financial Reporting Standards as adopted by the European Union (“IFRS-EU”) and the UK Companies Act 2006 applied on a consistent basis throughout the periods covered thereby.

The consolidated financial statements and the related notes thereto of RAI included or incorporated by reference in each of the Registration Statement, the Time of Sale Information and the Prospectus comply with applicable requirements of the Securities Act, the Exchange Act and the rules and regulations of the Commission thereunder, and present a true and fair view of the consolidated financial position of RAI and its subsidiaries as of the dates indicated and the consolidated results of their operations and the consolidated changes in their cash flows for the periods specified; such consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles applied on a consistent basis throughout the periods covered thereby.

(g)          No Material Adverse Change.  Since the date of the most recent consolidated financial statements of the Parent included in each of the Registration Statement, the Time of Sale Information and the Prospectus, there has not been any material adverse change in or affecting the business, consolidated financial position, consolidated results of operations or prospects of the Parent and its subsidiaries taken as a whole, as applicable, except in each case as otherwise disclosed in the Registration Statement, the Time of Sale Information or the Prospectus.


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(h)       Organization and Good Standing.  The Issuer and Guarantors have been duly organized, are validly existing and are in good standing under the laws of each of their respective jurisdictions of organization (to the extent that a legal concept of “good standing” is provided for under the laws of such jurisdictions of organization), except where the failure to be so qualified, in good standing or have such power or authority would not reasonably be expected to, individually or in the aggregate, have a material adverse effect on the business, financial position, results of operations or prospects of the Parent and its subsidiaries taken as a whole or on the performance by the Issuer and the Guarantors of their respective obligations under the Notes and the applicable Guarantees, whether or not arising from transactions in the ordinary course of business (a “Material Adverse Effect”).

(i)         Due Authorization.  The Issuer and each Guarantor have full right, power and authority to execute and deliver this Agreement, the Notes, the Guarantees and the Indenture (collectively, the “Transaction Documents”), as applicable, and to perform their respective obligations hereunder and thereunder; and all action required to be taken for the due and proper authorization, execution and delivery of each of the Transaction Documents and the consummation of each transaction contemplated thereby has been duly and validly taken.

(j)         The Indenture.  The Indenture has been duly qualified under the Trust Indenture Act and will be, on or prior to the Closing Date, duly authorized, executed and delivered by the Issuer and each Guarantor party thereto and when duly executed and delivered in accordance with its terms by each of the parties thereto, will constitute a valid and legally binding agreement of the Issuer and each Guarantor party thereto enforceable against the Issuer and each Guarantor party thereto in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally from time to time in effect or by general principles of equity, regardless of whether considered in a proceeding in equity or at law (collectively, the “Enforceability Exceptions”).

(k)       The Notes and the Guarantees.  The Notes have been duly authorized by the Issuer and, when duly executed, authenticated, issued and delivered in accordance with the provisions of the Indenture and paid for as provided herein, will be duly and validly issued and outstanding and will constitute valid and legally binding obligations of the Issuer, enforceable against the Issuer in accordance with their terms, subject to the Enforceability Exceptions, and will be entitled to the benefits of the Indenture; and the Guarantees have been duly authorized by each Guarantor and, when executed and delivered by each Guarantor and when the Notes have been duly executed, authenticated, issued and delivered as provided in the Indenture and paid for as provided herein, will be valid and legally binding obligations of each Guarantor, enforceable against such Guarantor in accordance with their terms, subject to the Enforceability Exceptions, and will be entitled to the benefits of the Indenture.


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(l)          No Violation or Default.  No event has occurred nor, so far as the Issuer and the Guarantors are aware, have any circumstances arisen since March 15, 2019 which constitute or result in, or would with the giving of notice or lapse of time or the fulfillment of any condition or the making of any determination constitute or result in default or the acceleration or breach of any payment obligation under any debt agreement, instrument or arrangement to which the Issuer and any Guarantor is a party, other than as would not reasonably be expected to have a Material Adverse Effect.

(m)         No Conflicts.  The execution, delivery and performance by the Issuer and each Guarantor of each of the Transaction Documents to which each is a party, the issuance and sale of the Notes (including the Guarantees) and compliance by the Issuer and each Guarantor with the terms thereof and the consummation of the transactions contemplated by the Transaction Documents will not (i) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Issuer or any Guarantor, pursuant to any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Issuer or any Guarantor is a party, or by which the Issuer or any Guarantor is bound, or to which any of the property or assets of the Issuer or any Guarantor is subject, or (ii) result in any violation of the provisions of the memorandum and articles of association or comparable constitutional documents of the Issuer or any Guarantor, or (iii) result in the violation of any law or statute or any judgment, order, rule or regulation applicable to the Issuer or any Guarantor of any court or arbitrator or governmental or regulatory authority, having jurisdiction over the Issuer or each such Guarantor, except, in the case of (i) and (iii) above, for any such conflict, breach, violation or default that would not, individually or in the aggregate, have a Material Adverse Effect or a material adverse effect upon the consummation of any transaction contemplated in any of the Transaction Documents.

(n)          No Consents Required.  No consent, approval, authorization, order, registration or qualification of or with any court or arbitrator or governmental or regulatory authority in the United States, the United Kingdom or the Netherlands is required for the execution, delivery and performance by the Issuer and each Guarantor of any of the Transaction Documents to which any is a party, the issuance and sale of the Notes (including each Guarantee) and compliance by the Issuer and each Guarantor with the terms thereof and the consummation of the transactions contemplated by the Transaction Documents, except for such consents, approvals, authorizations, orders and registrations or qualifications as (i) have been obtained or made under the Securities Act, the Exchange Act and the Trust Indenture Act, (ii) may be required under applicable state securities laws or foreign securities laws or (iii) may be required in connection with the admission of the Notes to trading on any exchange.

(o)          Legal Proceedings.  Except as disclosed in each of the Time of Sale Information and the Prospectus, there are no legal, governmental or regulatory


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investigations, actions, suits or proceedings pending to which the Issuer or any Guarantor is or may be a party or to which any property of the Issuer or any Guarantor is or may be the subject that, individually or in the aggregate, if determined adversely to the Issuer or any Guarantor, could reasonably be expected to have a Material Adverse Effect or a material adverse effect upon the consummation of any transaction contemplated in any of the Transaction Documents; and no such investigations, actions, suits or proceedings are threatened or, to the best knowledge of the Issuer and each Guarantor, contemplated by any governmental or regulatory authority or by others.

(p)           Auditors.  KPMG LLP (UK), which has audited the consolidated historical financial statements for the years ended December 31, 2016, 2017 and 2018 of the Parent and its subsidiaries and delivered their reports with respect to such financial statements, were, on the date of such audit reports, independent auditors with respect to the Parent in accordance with audit regulation and guidance issued by the Institute of Chartered Accountants in England and Wales.

KPMG LLP (U.S.), which has audited the consolidated historical financial statements for the year ended December 31, 2016 of RAI and its subsidiaries, and delivered its report with respect to such audited consolidated financial statements, were, on the date of such audit report, independent auditors with respect to RAI in accordance with audit regulations and guidance issued by the Public Company Accounting Oversight Board in the United States.

(q)           Investment Company Act.  None of the Issuer or the Guarantors is, and after giving effect to the offering and sale of the Notes and the application of the proceeds thereof as disclosed in each of the Time of Sale Information and the Prospectus, none of them will be, required to register as an “investment company” as such term is defined in the U.S. Investment Company Act of 1940, as amended, and the rules and regulations of the Securities and Exchange Commission thereunder.

(r)           Disclosure Controls.  The Parent maintains an effective system of “disclosure controls and procedures” (as defined in Rule 13a-15(e) of the Exchange Act) that complies with the requirements of the Exchange Act and that has been designed to ensure that information required to be disclosed by the Parent in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms, including controls and procedures designed to ensure that such information is accumulated and communicated to the Parent’s management as appropriate to allow timely decisions regarding required disclosure.  The Parent’s management has carried out evaluations of the effectiveness of its disclosure controls and procedures as required by Rule 13a-15 of the Exchange Act.

(s)           Accounting Controls.  The Parent maintains a system of internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) sufficient to provide reasonable assurance regarding the reliability of financial


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reporting and the preparation of financial statements for external purposes in accordance with IFRS-EU, IFRS-IASB or applicable local generally accepted accounting principles (“GAAP”), including, but not limited to internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with IFRS-EU, IFRS-IASB or applicable local GAAP and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences.  There are no material weaknesses or significant deficiencies in the internal controls of the Parent.

(t)           Anti-Corruption Matters. Except for potential violations in relation to the matters disclosed under the heading “Update on Ongoing Investigation Into Misconduct Allegations” in the Parent’s Half-Year Report to June 30, 2019, furnished to the Commission on Form 6-K on August 1, 2019 and incorporated by reference into the Prospectus, and in each of the Time of Sale Information and the Prospectus, neither the Issuer nor the Guarantors nor, to the knowledge of each of the Issuer and Guarantors, any director, officer, agent or employee of the Issuer or the Guarantors, has used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; violated or is in violation of any provision of any applicable anti-bribery or anti-corruption law or regulation; or made, offered or promised to make, or authorized the payment or giving of any bribe, rebate, payoff, influence payment, facilitation payment, kickback or other unlawful payment or gift of money or anything of value prohibited under any applicable law or regulation and the Issuer and the Guarantors have conducted their businesses in compliance with such applicable laws and regulations and have in place and will enforce policies and procedures designed to ensure compliance therewith.

(u)         Compliance with Money Laundering Laws. The operations of each of the Issuer and the Guarantors are in compliance with all applicable statutes and administrative regulations relating to money-laundering, unlawful financial activities, and control and prevention of terrorism, and the Issuer and the Guarantors have in place and will enforce policies and procedures designed to ensure continued compliance therewith.

(v)         Economic Sanctions. None of the Issuer, Guarantors or their respective subsidiaries or, to the knowledge of the Issuer or the Guarantors, any director, officer, agent or employee of the Issuer, the Guarantors or any of their respective subsidiaries is currently the subject of any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury (“OFAC”). The Issuer will not, directly or indirectly, use the proceeds of the offering of the Notes hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for


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the purpose of financing activities or business of or with any person that, at the time of such financing, is the subject of any U.S. sanctions administered by OFAC or any sanctions administered by the Commission of the European Union or Her Majesty’s Treasury. Each Underwriter, the Issuer and each Guarantor agrees and confirms that it is not entitled to the benefit of or does not make, seek, or repeat, as appropriate, the representations and warranties in this clause (v) to the extent that those provisions would result in a violation of Council Regulation (EC) 2271/1996 and/or any applicable national law which purports to create liability in respect of such violation in any member state of the European Union or in the United Kingdom.

(w)          Sarbanes-Oxley Act.  There is and has been no failure on the part of the Parent or any of the Parent’s directors or officers, in their capacities as such, to comply with any provision of the Sarbanes-Oxley Act of 2002, as amended, and the rules and regulations promulgated in connection therewith (the “Sarbanes-Oxley Act”), including Section 402 related to loans and Sections 302 and 906 related to certifications, in each case of the Sarbanes-Oxley Act.

(x)          Status under the Securities Act.  The Parent is not an ineligible issuer and is a well-known seasoned issuer, in each case as defined under the Securities Act, in each case at the times specified in the Securities Act in connection with the offering of the Notes.

5.           Further Agreements of the Issuer and the Guarantors.  The Issuer and each Guarantor jointly and severally covenants and agrees with each Underwriter that:

(a)           Required Filings.  The Issuer and the Guarantors will file the Prospectus with the Commission within the time periods specified by Rule 424(b) and Rule 430A, 430B or 430C under the Securities Act, as applicable, will file any Issuer Free Writing Prospectus (including the pricing term sheets in the form of Annex B hereto) to the extent required by Rule 433 under the Securities Act; and the Issuer will file promptly all reports or information statements required to be filed by the Issuer with the Commission pursuant to Section 13(a), 13(c) or 15(d) of the Exchange Act during the Prospectus Delivery Period (as defined below); and the Issuer will furnish copies of the Prospectus and each Issuer Free Writing Prospectus (to the extent not previously delivered) to the Underwriters in New York City within a reasonable amount of time prior to such proposed use, in such quantities as the Representatives may reasonably request.  The Issuer will pay the registration fees for this offering within the time period required by Rule 456(b)(1)(i) under the Securities Act (without giving effect to the proviso therein) and in any event prior to the Closing Date.

(b)         Delivery of Copies.  The Issuer will deliver, without charge, to each Underwriter (i) a copy of the Registration Statement as originally filed and each amendment thereto, in each case including all exhibits and consents filed therewith and (ii) during the Prospectus Delivery Period (as defined below), as many copies of the Prospectus (including all amendments and supplements thereto and


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documents incorporated by reference therein) and each Issuer Free Writing Prospectus as the Representatives may reasonably request.  As used herein, the term “Prospectus Delivery Period” means the period of time during which a prospectus (or in lieu thereof, the notice referred to in Rule 173(a) under the Securities Act) relating to the Notes is required by law to be delivered in connection with sales of the Notes by any Underwriter or dealer.

(c)          Amendments or Supplements; Issuer Free Writing Prospectuses.  Before using, authorizing, approving or filing any Issuer Free Writing Prospectus, and before filing any amendment or supplement to the Registration Statement or the Prospectus, during the Prospectus Delivery Period, the Issuer will furnish to the Representatives and counsel for the Underwriters a copy of the proposed Issuer Free Writing Prospectus, amendment or supplement for review and will not use, authorize, approve or file any such Issuer Free Writing Prospectus or file any such proposed amendment or supplement to which the Representatives reasonably object.

(d)         Notice to the Representatives.  The Issuer will advise the Representatives promptly during the Prospectus Delivery Period (i) when any amendment to the Registration Statement has been filed or becomes effective; (ii) when any supplement to the Prospectus or any amendment to the Prospectus or any Issuer Free Writing Prospectus has been filed; (iii) of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or the receipt of any comments from the Commission relating to the Registration Statement or any other request by the Commission for any additional information; (iv) of the issuance by the Commission or any other governmental or regulatory authority of any order suspending the effectiveness of the Registration Statement or preventing or suspending the use of any of the Preliminary Prospectus, the Prospectus or the Time of Sale Information or any Issuer Free Writing Prospectus or the initiation or threatening of any proceeding for that purpose or pursuant to Section 8A of the Securities Act; (v) of the occurrence of any event as a result of which the Prospectus, any of the Time of Sale Information or any Issuer Free Writing Prospectus as then amended or supplemented would include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing when the Prospectus, the Time of Sale Information or any such Issuer Free Writing Prospectus is delivered to a purchaser, not misleading; (vi) of the receipt by the Issuer of any notice of objection of the Commission to the use of the Registration Statement or any post-effective amendment thereto pursuant to Rule 401(g)(2) under the Securities Act; and (vii) of the receipt by the Issuer of any notice with respect to any suspension of the qualification of the Notes for offer and sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and the Issuer will use its reasonable best efforts to prevent the issuance of any such order suspending the effectiveness of the Registration Statement, preventing or suspending the use of any Preliminary Prospectus, any of the Time of Sale Information, Issuer Free Writing Prospectus or the Prospectus, or


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suspending any such qualification of the Notes and, if any such order is issued, will obtain as soon as practicable the withdrawal thereof.

(e)           Time of Sale Information.  If at any time prior to the Closing Date (i) any event shall occur or condition shall exist as a result of which any of the Time of Sale Information as then amended or supplemented would include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading or (ii) it is necessary to amend or supplement any of the Time of Sale Information to comply with law, the Issuer will promptly notify the Underwriters thereof and forthwith prepare and, subject to paragraph (c) above, file with the Commission (to the extent required) and furnish to the Underwriters such amendments or supplements to any of the Time of Sale Information (including any document to be filed with the Commission and incorporated by reference therein) as may be necessary so that the statements in any of the Time of Sale Information as so amended or supplemented (including such documents to be incorporated by reference therein) will not, in light of the circumstances under which they were made, be misleading or so that any of the Time of Sale Information will comply with law; provided that nothing in this paragraph shall require supplementary listing particulars to be prepared, submitted to any securities exchange or listing authority for approval or published.

(f)           Ongoing Compliance.  If during the Prospectus Delivery Period (i) any event shall occur or condition shall exist as a result of which the Prospectus as then amended or supplemented would include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances existing when the Prospectus is delivered to a purchaser, not misleading or (ii) it is necessary to amend or supplement the Prospectus to comply with law, the Issuer will promptly notify the Underwriters thereof and forthwith prepare and, subject to paragraph (c) above, file with the Commission and furnish to the Underwriters such amendments or supplements to the Prospectus as may be necessary so that the statements in the Prospectus as so amended or supplemented will not, in the light of the circumstances existing when the Prospectus is delivered to a purchaser, be misleading or so that the Prospectus will comply with law; provided that nothing in this paragraph (f) shall require supplementary listing particulars to be prepared, submitted to any securities exchange or listing authority for approval or published.

(g)          Blue Sky Compliance.  The Issuer will qualify the Notes for offer and sale under the securities or Blue Sky laws of such jurisdictions as the Representatives shall reasonably request in due course and will continue such qualifications in effect so long as required for the distribution of the Notes; provided that neither the Issuer nor the Guarantors shall be required to (i) qualify as a foreign corporation or other entity or as a dealer in securities in any such jurisdiction where it would not otherwise be required to so qualify, (ii) file any general consent to service of process in any such jurisdiction or (iii) subject itself to taxation in any such jurisdiction if it is not otherwise so subject.


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(h)        Clear Market.  During the period from and including the date hereof through and including the Closing Date, none of the Issuer or any Guarantor will, without the prior written consent of the Representatives, offer, sell, contract to sell or otherwise dispose of any debt securities in the United States issued or guaranteed by the Issuer or any Guarantor and having a tenor of more than one year.

(i)          Use of Proceeds.  The Issuer will apply the net proceeds from the sale of the Notes as described in each of the Time of Sale Information and the Prospectus, as such Prospectus may be amended or supplemented from time to time, under the heading “Use of Proceeds”.

(j)            Public Disclosure of Information.  The Issuer authorizes BofA Securities, Inc. to make adequate public disclosure of information and to act as the central point responsible for handling any request from a competent authority, in each case as required by Article 6(5) of Commission Delegated Regulation (EU) 2016/1052 of March 8, 2016 with regard to regulatory technical standards for the conditions applicable to buy-back programs and stabilization measures.

(k)           Clearance and Settlement.  The Issuer will cooperate with the Representatives and use its reasonable best efforts to permit the Notes to be eligible for clearance and settlement through DTC.

(l)           No Stabilization.  None of the Issuer or Guarantors will take, directly or indirectly, any action designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of the Notes.

(m)        Exchange Listing.  If the applicable pricing term sheet provides that the Notes are to be listed, the Issuer will use its reasonable efforts to list the Notes on the securities exchange designated in the pricing term sheet.

(n)         Earning Statement.  The Parent will make generally available to its security holders and the Representatives an earning statement of the Parent that satisfies the provisions of Section 11(a) of the Securities Act and Rule 158 promulgated thereunder covering a period of at least twelve months; provided that the Parent will be deemed to have furnished such statement to its security holders and the Representatives if it is filed in accordance with Rule 158 of the Securities Act; provided further that the Statement of Comprehensive Income (or equivalent) included in the Parent’s Annual Report on Form 20-F dated March 15, 2019 is deemed to satisfy this requirement.

6.           Certain Agreements of the Underwriters.  Each Underwriter hereby represents and agrees that:

(a)          It has not used and will not use, authorize use of, refer to, or participate in the planning for use of, any “free writing prospectus”, as defined in Rule 405 under the Securities Act (which term includes use of any written information furnished to the Commission by the Issuer and not incorporated by reference into the Registration Statement and any press release issued by the Issuer)

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other than (i) a free writing prospectus that, solely as a result of use by such Underwriter, would not trigger an obligation to file such free writing prospectus with the Commission pursuant to Rule 433, (ii) any Issuer Free Writing Prospectus listed on Annex A hereto or prepared pursuant to Section 4(c) or Section 5(c) above (including any electronic road show), or (iii) any free writing prospectus prepared by such Underwriter and approved by the Issuer in advance in writing. Notwithstanding the foregoing, the Underwriters may use the pricing term sheets referred to in Annex B hereto without the consent of the Issuer.

(b)          It is not subject to any pending proceeding under Section 8A of the Securities Act with respect to the offering of the Notes (and will promptly notify the Issuer if any such proceeding against it is initiated during the Prospectus Delivery Period).

7.         Conditions of Underwriters’ Obligations.  The obligation of each Underwriter to purchase Notes on the Closing Date as provided herein is subject to the performance by the Issuer and each Guarantor of their respective covenants and other obligations hereunder and to the following additional conditions:

(a)        Registration Compliance; No Stop Order.  No order suspending the effectiveness of the Registration Statement shall be in effect, and no proceeding for such purpose, pursuant to Rule 401(g)(2) or pursuant to Section 8A under the Securities Act shall be pending before or threatened by the Commission; the Prospectus and each Issuer Free Writing Prospectus shall have been timely filed with the Commission under the Securities Act (in the case of an Issuer Free Writing Prospectus, to the extent required by Rule 433 under the Securities Act) and in accordance with Section 5(a) hereof; and all requests by the Commission for additional information shall have been complied with to the reasonable satisfaction of the Representatives.

(b)          Representations and Warranties.  The representations and warranties of the Issuer and each Guarantor contained herein shall be true and correct on the date hereof and on and as of the Closing Date; and the statements of the Issuer, each Guarantor and their respective officers made in any certificates delivered pursuant to this Agreement shall be true and correct on and as of the Closing Date.

(c)          No Downgrade.  Subsequent to the earlier of (i) the Time of Sale and (ii) the execution and delivery of this Agreement and prior to the Closing Date, (A) no downgrading shall have occurred in the rating accorded to the Notes or any other debt securities or preferred stock issued or guaranteed by the Parent or any of its subsidiaries by any “nationally recognized statistical rating organization”, as such term is defined by the Commission for purposes of Rule 3(a)(62) under the Exchange Act; and (B) no such organization shall have publicly announced that it has under surveillance or review, or has changed its outlook with respect to, its rating of the Notes or of any other debt securities or preferred stock issued or


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guaranteed by the Parent or any of its subsidiaries (other than an announcement with positive implications of a possible upgrading).

(d)          No Material Adverse Change.  No event or condition of a type described in Section 4(g) hereof shall have occurred or shall exist, which event or condition is not described in each of the Time of Sale Information (excluding any amendment or supplement thereto) and the Prospectus (excluding any amendment or supplement thereto) the effect of which in the judgment of the Representatives, after consultation with the Parent if practicable, makes it impracticable or inadvisable to proceed with the offering, sale or delivery of the Notes on the terms and in the manner contemplated by this Agreement, the Time of Sale Information and the Prospectus.

(e)          Officer’s Certificate.  The Representatives shall have received on and as of the Closing Date a certificate either of an Executive Director or the Group Treasurer of the Parent (i) confirming that the representations and warranties of the Issuer and each Guarantor in this Agreement are true and correct and that the Issuer and each Guarantor have complied with all covenants and agreements and satisfied all conditions on their part to be performed or satisfied hereunder at or prior to the Closing Date and (ii) substantially to the effect set forth in paragraphs (b) and (d) of this Section 7. Any such person signing and delivering such certificate may certify to his or her knowledge.

(f)           Comfort Letters.  On the date of this Agreement and on the Closing Date, KPMG LLP (UK) and KPMG LLP (U.S.) shall have furnished to the Representatives, at the request of the Parent (with respect to KPMG LLP (UK)) and RAI (with respect to KPMG LLP (U.S.)), letters, dated the respective dates of delivery thereof, and addressed to the Underwriters, in form and substance reasonably satisfactory to the Representatives, containing statements and information of the type customarily included in accountants’ “comfort letters” to underwriters with respect to the applicable financial statements and certain other financial information contained or incorporated by reference in each of the Registration Statement, the Time of Sale Information and the Prospectus; provided that the letters delivered on the Closing Date shall use a “cut-off” date no more than three business days prior to the Closing Date.

(g)          Opinion and 10b-5 Statement of Counsel for the Issuer.  (i) Linklaters LLP, English counsel for the Issuer and the Guarantors, shall have furnished to the Representatives, at the request of the Issuer and the Parent, their written opinion, dated the Closing Date and addressed to the Underwriters, substantially in the form of Annex C hereto; (ii) Stibbe N.V., Dutch counsel for BATNF, shall have furnished to the Representatives, at the request of BATNF, their written opinion, dated the Closing Date and addressed to the Underwriters, substantially in the form of Annex D hereto; (iii) Kilpatrick Townsend & Stockton LLP, North Carolina counsel for RAI, shall have furnished to the Representatives, at the request of RAI, their written opinion, dated the Closing Date and addressed to the Underwriters, substantially in the form of Annex E hereto; and (iv) Cravath,


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Swaine & Moore LLP, U.S. counsel for the Issuer and the Guarantors, shall have furnished to the Representatives, at the request of the Issuer and the Guarantors, their written opinion and 10b-5 statement, dated the Closing Date and addressed to the Underwriters, substantially in the form of Annex F hereto; in each case, in form and substance reasonably satisfactory to the Representatives.

(h)          Opinion and 10b-5 Statement of Counsel for the Underwriters.  The Representatives shall have received on and as of the Closing Date an opinion and 10b-5 statement of Davis Polk & Wardwell London LLP, counsel for the Underwriters, with respect to such matters as the Representatives may reasonably request, and such counsel shall have received such documents and information as they may reasonably request to enable them to pass upon such matters.

(i)           No Legal Impediment to Issuance.  No action shall have been taken and no statute, rule, regulation or order shall have been enacted, adopted or issued by any federal, state or foreign governmental or regulatory authority that would, as of the Closing Date, prevent the issuance or sale of the Notes or the issuance of the Guarantees; and no injunction or order of any federal, state or foreign court shall have been issued that would, as of the Closing Date, prevent the issuance or sale of the Notes or the issuance of the Guarantees.

(j)           Clearance and Settlement.  The Notes shall be eligible for clearance and settlement through DTC.

(k)          Additional Documents.  On or prior to the Closing Date, the Issuer and each Guarantor shall have furnished to the Representatives such further certificates and documents as the Representatives may reasonably request.

All opinions, letters, certificates and evidence mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to Davis Polk & Wardwell London LLP as counsel for the Underwriters.

8.          Indemnification and Contribution.  (a) Indemnification of the Underwriters.  The Issuer and each Guarantor jointly and severally agrees to indemnify and hold harmless each Underwriter, its affiliates, directors, officers, employees, agents of each Underwriter and each person, if any, who controls such Underwriter within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, from and against any and all losses, claims, damages and liabilities (including, without limitation, legal fees and other expenses reasonably incurred in connection with any suit, action or proceeding or any claim asserted, as such fees and expenses are incurred), joint or several, that arise out of, or are based upon, (i) any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, not misleading, or (ii) any untrue statement or alleged untrue statement of a material fact contained in any Issuer Free Writing Prospectus, any Time of Sale Information or the Prospectus (or any amendment or supplement thereto), or caused by any omission or


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alleged omission to state therein a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, in each case except insofar as such losses, claims, damages or liabilities arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to any Underwriter furnished to the Issuer in writing by such Underwriter through the Representatives expressly for use therein.

(b)          Indemnification of the Issuer and each Guarantor.  Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Issuer, each Guarantor, each of their respective directors and officers and each person, if any, who controls the Issuer or any Guarantor within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the indemnity to each Underwriter set forth in paragraph (a) above, but only with respect to any losses, claims, damages or liabilities that arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to such Underwriter furnished to the Issuer in writing by such Underwriter through the Representatives expressly for use in the Registration Statement,  any Issuer Free Writing Prospectus, any Time of Sale Information or the Prospectus (or any amendment or supplement thereto), it being understood and agreed that the only such information consists of the following: (i) the statements set forth in the last paragraph of the cover page regarding the delivery of the Notes and (ii), under the heading “Underwriting”, (A) the statements set forth in the sixth paragraph related to offer prices, and (B) the statements set forth in the eighth, ninth, tenth, eleventh and twelfth paragraphs, related to market-making, stabilization, syndicate covering transactions and penalty bids, in each the Time of Sale Information and the Prospectus.

(c)          Notice and Procedures.  If any suit, action, proceeding (including any governmental or regulatory investigation), claim or demand shall be brought or asserted against any person in respect of which indemnification may be sought pursuant to either paragraph (a) or (b) above, such person (the “Indemnified Person”) shall promptly notify the person against whom such indemnification may be sought (the “Indemnifying Person”) in writing; provided that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have under this Section 8 except to the extent that it has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure; and provided, further, that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have to an Indemnified Person otherwise than under this Section 8.  If any such proceeding shall be brought or asserted against an Indemnified Person and it shall have notified the Indemnifying Person thereof, the Indemnifying Person shall retain counsel reasonably satisfactory to the Indemnified Person (who shall not, without the consent of the Indemnified Person, be counsel to the Indemnifying Person) to represent the Indemnified Person and any others entitled to indemnification pursuant to this Section 8 that the Indemnifying Person may designate in such proceeding and shall pay the fees and


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expenses (excluding any recoverable VAT (or similar taxes levied by reference to added value or sales)) of such proceeding and shall pay the fees and expenses (excluding any recoverable VAT (or similar taxes levied by reference to added value or sales)) of such counsel related to such proceeding, as incurred.  In any such proceeding, any Indemnified Person shall have the right to retain its own counsel, but the fees and expenses (including any amount paid for or in respect of VAT (or similar tax levied by reference to added value or sales)) of such counsel shall be at the expense of such Indemnified Person unless (i) the Indemnifying Person and the Indemnified Person shall have mutually agreed to the contrary; (ii) the Indemnifying Person has failed within a reasonable time to retain counsel reasonably satisfactory to the Indemnified Person; (iii) the Indemnified Person shall have reasonably concluded that there may be legal defenses available to it that are different from or in addition to those available to the Indemnifying Person; or (iv) the named parties in any such proceeding (including any impleaded parties) include both the Indemnifying Person and the Indemnified Person and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them.  It is understood and agreed that the Indemnifying Person shall not, in connection with any proceeding or related proceeding in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel) for all Indemnified Persons, and that all such fees and expenses shall be reimbursed as they are incurred.  Any such separate firm for any Underwriter, its affiliates, directors and officers and any control persons of such Underwriter shall be designated in writing by the Representatives and any such separate firm for the Issuer, the Guarantors, their respective directors and officers and any control persons of the Issuer and any Guarantor shall be designated in writing by the Issuer.  The Indemnifying Person shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the Indemnifying Person agrees to indemnify each Indemnified Person from and against any loss or liability by reason of such settlement or judgment.  Notwithstanding the foregoing sentence, if at any time an Indemnified Person shall have requested that an Indemnifying Person reimburse the Indemnified Person for fees and expenses of counsel as contemplated by this paragraph, the Indemnifying Person shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by the Indemnifying Person of such request and (ii) the Indemnifying Person shall not have reimbursed the Indemnified Person in accordance with such request prior to the date of such settlement.  No Indemnifying Person shall, without the written consent of the Indemnified Person, effect any settlement of any pending or threatened claim in respect of which any Indemnified Person is or could have been a party and indemnification could have been sought hereunder by such Indemnified Person, unless such settlement (x) includes an unconditional release of such Indemnified Person, in form and substance reasonably satisfactory to such Indemnified Person, from all liability on claims that are the subject matter of such proceeding and (y) does not include any statement as to or any admission of fault, culpability or a failure to act by or on behalf of any Indemnified Person.


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(d)          Contribution.  If the indemnification provided for in paragraphs (a) and (b) above is unavailable to an Indemnified Person or insufficient for any reason in respect of any losses, claims, damages or liabilities referred to therein, then each Indemnifying Person under such paragraph, in lieu of indemnifying such Indemnified Person thereunder, shall contribute to the amount paid or payable by such Indemnified Person as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Issuer and the Guarantors on the one hand and the Underwriters on the other from the offering of the Notes or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) but also the relative fault of the Issuer and the Guarantors on the one hand and the Underwriters on the other in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations.  The relative benefits received by the Issuer and the Guarantors on the one hand and the Underwriters on the other shall be deemed to be in the same respective proportions as the net proceeds (before deducting expenses) received by the Issuer from the sale of the Notes and the total discounts and commissions received by the Underwriters in connection therewith, in each case as set forth in the table on the cover of the Prospectus, bear to the aggregate offering price of the Notes.  The relative fault of the Issuer and the Guarantors, on the one hand, and the Underwriters, on the other, shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Issuer or any Guarantor or by the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

(e)          Limitation on Liability.  The Issuer, each Guarantor and the Underwriters agree that it would not be just and equitable if contribution pursuant to this Section 8 were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in paragraph (d) above.  The amount paid or payable by an Indemnified Person as a result of the losses, claims, damages and liabilities referred to in paragraph (d) above shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such Indemnified Person in connection with any such action or claim.  Notwithstanding the provisions of this Section 8, in no event shall an Underwriter be required to contribute any amount in excess of the amount by which the total underwriting discounts and commissions received by such Underwriter with respect to the offering of the Notes exceeds the amount of any damages that such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission.  No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.  The Underwriters’ obligations to contribute pursuant to this Section 8 are several in proportion to their respective purchase obligations hereunder and not joint.


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(f)          Non-Exclusive Remedies.  The remedies provided for in this Section 8 are not exclusive and shall not limit any rights or remedies that may otherwise be available to any Indemnified Person at law or in equity.

9.            Effectiveness of Agreement.  This Agreement shall become effective as of the date first written above upon the execution and delivery hereof by the parties hereto.

10.         Termination.  This Agreement may be terminated in the absolute discretion of the Representatives, by notice to the Issuer, if after the execution and delivery of this Agreement and on or prior to the Closing Date (i) trading generally shall have been suspended or materially limited on the New York Stock Exchange or the U.S. over-the-counter market; (ii) trading of any securities issued or guaranteed by the Issuer or any Guarantor shall have been suspended on any exchange or in any over-the-counter market; (iii) a general moratorium on commercial banking activities shall have been declared by U.S. federal or New York State authorities; or (iv) there shall have occurred any outbreak or escalation of hostilities or any change in financial markets or any calamity or crisis either within or outside the United States that, in the judgment of the Representatives, is material and adverse and makes it impracticable or inadvisable to proceed with the offering, sale or delivery of the Notes on the terms and in the manner contemplated by this Agreement, the Time of Sale Information and the Prospectus.

11.        Defaulting Underwriter.  (a) If, on the Closing Date, any Underwriter defaults on its obligation to purchase the Notes that it has agreed to purchase hereunder, the non-defaulting Underwriters may in their discretion arrange for the purchase of such Notes by other persons satisfactory to the Issuer and the Guarantors on the terms contained in this Agreement.  If, within 36 hours after any such default by any Underwriter, the non-defaulting Underwriters do not arrange for the purchase of such Notes, then the Issuer and the Guarantors shall be entitled to a further period of 36 hours within which to procure other persons satisfactory to the non-defaulting Underwriters, acting reasonably, to purchase such Notes on such terms.  If other persons become obligated or agree to purchase the Notes of a defaulting Underwriter, either the non-defaulting Underwriters or the Issuer and the Guarantors may postpone the Closing Date for up to five full business days in order to effect any changes that in the opinion of counsel for the Issuer and the Guarantors or counsel for the Underwriters may be necessary in the Registration Statement, the Time of Sale Information and the Prospectus or in any other document or arrangement, and the Issuer and the Guarantors agree to promptly prepare any amendment or supplement to the Registration Statement, the Time of Sale Information and the Prospectus that effects any such changes.  As used in this Agreement, the term “Underwriter” includes, for all purposes of this Agreement unless the context otherwise requires, any person not listed in Schedule 1 hereto that, pursuant to this Section 11, purchases Notes that a defaulting Underwriter agreed but failed to purchase.

(b)          If, after giving effect to any arrangements for the purchase of the Notes of a defaulting Underwriter or Underwriters by the non-defaulting Underwriters and the Issuer and the Guarantors as provided in paragraph (a) above, the aggregate principal amount of such Notes that remains unpurchased does not exceed one-eleventh of the aggregate principal amount of all the Notes, then the


21



Issuer and each Guarantor shall have the right to require each non-defaulting Underwriter to purchase the principal amount of Notes that such Underwriter agreed to purchase hereunder plus such Underwriter’s pro rata share (based on the principal amount of Notes that such Underwriter agreed to purchase hereunder) of the Notes of such defaulting Underwriter or Underwriters for which such arrangements have not been made.

(c)          If, after giving effect to any arrangements for the purchase of the Notes of a defaulting Underwriter or Underwriters by the non-defaulting Underwriters and the Issuer and the Guarantors as provided in paragraph (a) above, the aggregate principal amount of such Notes that remains unpurchased exceeds one-eleventh of the aggregate principal amount of all the Notes, or if the Issuer and the Guarantors shall not exercise the right described in paragraph (b) above, then this Agreement shall terminate without liability on the part of the non-defaulting Underwriters.  Any termination of this Agreement pursuant to this Section 11 shall be without liability on the part of the Issuer or any Guarantor, except that the Issuer and each Guarantor will continue to be liable for the payment of expenses as set forth in Section 12 hereof and except that the provisions of Section 8 hereof shall not terminate and shall remain in effect.

(d)          Nothing contained herein shall relieve a defaulting Underwriter of any liability it may have to the Issuer, any Guarantor or any non-defaulting Underwriter for damages caused by its default.

12.          Payment of Expenses.  (a) Whether or not the transactions contemplated by this Agreement are consummated or this Agreement is terminated, the Issuer and each Guarantor jointly and severally agree to pay or cause to be paid all costs and expenses incident to the performance of their respective obligations hereunder (excluding, for the avoidance of doubt, the fees and expenses of counsel to the Underwriters), including without limitation, (i) the costs incident to the authorization, issuance, sale, preparation and delivery of the Notes (excluding any recoverable value added tax) as contemplated by this Agreement, and any transfer taxes payable in connection therewith; (ii) the costs incident to the preparation, printing and filing under the Securities Act of the Registration Statement, the Preliminary Prospectus, any Issuer Free Writing Prospectus, any Time of Sale Information and the Prospectus (including all exhibits, amendments and supplements thereto) and the distribution thereof; (iii) the costs of reproducing and distributing each of the Transaction Documents; (iv) the fees and expenses of the Issuer’s and each Guarantor’s counsel and independent accountants; (v) the fees and expenses incurred in connection with the registration or qualification and determination of eligibility for investment of the Notes under the laws of such jurisdictions as the Representatives may designate and the preparation, printing and distribution of a Blue Sky Memorandum (including the related fees and expenses of counsel for the Underwriters); (vi) any fees charged by rating agencies for rating the Notes, if any; (vii) the preparation of the Indenture and fees and expenses of the Trustee (including related fees and expenses of any counsel to the Trustee); (viii) all expenses and application fees incurred in connection with any filing with, and clearance of the offering of the Notes by, the Financial Industry Regulatory Authority, and the approval of the Notes for book-entry transfer by DTC; (ix) all expenses incurred by the Issuer in


22



connection with any “road show” presentation to potential investors; and (x) any fees and expenses incurred in connection with the listing of the Notes on any securities exchange.

(b)          If (i) this Agreement is terminated pursuant to Section 10, (ii) the Issuer for any reason fails to tender the Notes for delivery to the Underwriters or (iii) the Underwriters decline to purchase the Notes for any reason permitted under this Agreement, the Issuer and each Guarantor jointly and severally agrees to reimburse the Underwriters for all out-of-pocket costs and expenses (including the fees and expenses of their counsel) reasonably incurred by the Underwriters in connection with this Agreement and the offering contemplated hereby; provided that, in respect of expenses so incurred by the Underwriters in the case of (i) above, such reimbursement shall not exceed $365,000 (exclusive of any value added tax which may be payable).

13.          Persons Entitled to Benefit of Agreement.  This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and any controlling persons referred to herein, and the affiliates, officers and directors of each Underwriter referred to in Section 8 hereof.  Nothing in this Agreement is intended or shall be construed to give any other person any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision contained herein.  No purchaser of Notes from any Underwriter shall be deemed to be a successor merely by reason of such purchase.

14.          Survival. The respective indemnities, rights of contribution, representations, warranties and agreements of the Issuer, each Guarantor and the Underwriters contained in this Agreement or made by or on behalf of the Issuer, each Guarantor or the Underwriters pursuant to this Agreement or any certificate delivered pursuant hereto shall survive the delivery of and payment for the Notes and shall remain in full force and effect, regardless of any termination of this Agreement or any investigation made by or on behalf of the Issuer, each Guarantor or the Underwriters.

15.          Certain Defined Terms.  For purposes of this Agreement (a) except where otherwise expressly provided, the term “affiliate” has the meaning set forth in Rule 405 under the Securities Act; (b) the term “business day” means any day other than a day on which banks are permitted or required to be closed in New York City or London; and (c) the term “subsidiary” has the meaning set forth in Rule 405 under the Securities Act.

16.          Miscellaneous.  (a) Authority of the Representatives.  Any action by the Underwriters hereunder may be taken by the Representatives on behalf of the Underwriters, and any such action taken shall be binding upon the Underwriters.

(b)          Notices.  All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted and confirmed by any standard form of telecommunication.  Notices to the Underwriters shall be given to the Representatives, addressed as follows:

BofA Securities, Inc.
50 Rockefeller Plaza
NY 1-050-12-02
New York, New York 10020
United States
Attention: High Grade Transaction Management/Legal
Fax: +1 (212) 901 7881
Tel: +1 (646) 855 0724


23



Barclays Capital Inc.
745 Seventh Avenue
New York, New York 10019
United States

Citigroup Global Markets Inc.
388 Greenwich Street
New York, New York 10013
United States
Attention: General Counsel
Fax: (646) 291-1469

Deutsche Bank Securities Inc.
60 Wall Street
New York, New York 10005
United States
Attention: Debt Capital Markets Syndicate
With a copy to General Counsel
Fax: +1 (646) 374 1071

HSBC Securities (USA) Inc.
452 Fifth Avenue, 3rd Floor
New York, New York 10018
United States

with a copy to:

Davis Polk & Wardwell London LLP
5 Aldermanbury Square
London EC2V 7HR
Attention: Reuven B. Young
Email: Reuven.Young@DavisPolk.com


(c)          Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of New York.

(d)          Jurisdiction.  The Issuer and the Guarantors agree that any suit, action or proceeding against any of them brought by any Underwriter, the directors, officers, employees, affiliates and agents of any Underwriter, or by any person who controls any Underwriter, arising solely out of or based upon this Agreement or the


24



transactions contemplated hereby may be instituted in the courts of the State of New York in the City and County of New York and of the United States for the Southern District of New York, and waives to the fullest extent that each may effectively do so any objection of which it may now or hereafter have to the laying of venue or of any such proceeding, and irrevocably submits to the non-exclusive jurisdiction of such courts in any such suit, action or proceeding.  The Parent, BATNF and BATIF hereby appoint the Issuer as their authorized agent (the “Authorized Agent”) (and the Issuer hereby accepts such appointment) upon whom process may be served in any suit, action or proceeding arising out of or based upon this Agreement or the transactions contemplated herein that may be instituted in any U.S. Federal or New York State court in the Borough of Manhattan in the City, County and State of New York, United States of America, by any Underwriter, the directors, officers, employees, affiliates and agents of any Underwriter, or any person who controls any Underwriter, and expressly accept the non-exclusive jurisdiction of any such court in respect of any such suit, action or proceeding.  The Parent, BATNF and BATIF hereby represent and warrant that the Authorized Agent has accepted such appointment and has agreed to act as said agent for service of process, and the Parent, BATNF and BATIF agree to take any and all action, including the filing of any and all documents that may be necessary to continue such appointment in full force and effect as aforesaid.  Service of process upon the Authorized Agent shall be deemed, in every respect, effective service of process upon the Parent, BATNF and BATIF.

(e)          Integration.  This Agreement supersedes all prior agreements and understandings (whether written or oral) between the Issuer, the Guarantors and the Underwriters, or any of them, with respect to the subject matter hereof.

(f)          Waiver of Jury Trial.  Each party hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.

(g)          Currency.  Each reference in this Agreement to U.S. dollars (the “relevant currency”), including by use of the symbol “$”, is of the essence.  To the fullest extent permitted by law, the obligation of each party in respect of any amount due under this Agreement will, notwithstanding any payment in any other currency (whether pursuant to a judgment or otherwise), be discharged only to the extent of the amount in the relevant currency that the party entitled to receive such payment may, in accordance with its normal procedures, purchase with the sum paid in such other currency (after any premium and costs of exchange) on the business day immediately following the day on which such party receives such payment.  If the amount in the relevant currency that may be so purchased for any reason falls short of the amount originally due, the applicable party will pay such additional amounts, in the relevant currency, as may be necessary to compensate for the shortfall.  Any obligation of the applicable party not discharged by such payment will, to the fullest extent permitted by applicable law, be due as a separate


25



and independent obligation and, until discharged as provided herein, will continue in full force and effect.

(h)          Waiver of Immunity.  To the extent that the Issuer or Guarantor has or hereafter may acquire any immunity (sovereign or otherwise) from any legal action, suit or proceeding, from jurisdiction of any court or from set-off or any legal process (whether service or notice, attachment in aid or otherwise) with respect to itself or any of its property, the Issuer hereby irrevocably waives and agrees not to plead or claim such immunity in respect of its obligations under this Agreement.

(i)           Waiver of Tax Confidentiality.  Notwithstanding anything herein to the contrary, purchasers of the Notes (and each employee, representative or other agent of a purchaser) may disclose to any and all persons, without limitation of any kind, the U.S. tax treatment and U.S. tax structure of any transaction contemplated herein and all materials of any kind (including opinions or other tax analyses) that are provided to the purchasers of the Notes relating to such U.S. tax treatment and U.S. tax structure, other than any information for which nondisclosure is reasonably necessary in order to comply with applicable securities laws.

(j)           Counterparts.  This Agreement may be signed in counterparts (which may include counterparts delivered by any standard form of telecommunication), each of which shall be an original and all of which together shall constitute one and the same instrument.

(k)           Amendments or Waivers.  No amendment or waiver of any provision of this Agreement, nor any consent or approval to any departure therefrom, shall in any event be effective unless the same shall be in writing and signed by the parties hereto.

(l)            Headings.  The headings herein are included for convenience of reference only and are not intended to be part of, or to affect the meaning or interpretation of, this Agreement.

17.         Contractual Recognition of Bail-In.  Notwithstanding and to the exclusion of any other term of this Agreement or any other agreements, arrangements, or understanding between the Underwriters, the Issuer and the Guarantors, the Issuer and each of the Guarantors acknowledges and accepts that a BRRD Liability arising under this Agreement may be subject to the exercise of Bail-in Powers by the Relevant Resolution Authority, and acknowledges, accepts and agrees to be bound by:

(a)          the effect of the exercise of Bail-in Powers by the Relevant Resolution Authority in relation to any BRRD Liability of an Underwriter to the Issuer and the Guarantors under this Agreement, that (without limitation) may include and result in any of the following, or some combination thereof:

(b)            the reduction of all, or a portion, of the BRRD Liability or outstanding amounts due thereon;


26



(c)          the conversion of all, or a portion, of the BRRD Liability into shares, other securities or other obligations of the relevant Underwriter or another person, and the issue to, or conferral on, the Issuer and the Guarantors of such shares, securities or obligations;

(d)          the cancellation of the BRRD Liability; or

(e)          the amendment or alteration of any interest, if applicable, thereon, the maturity or the dates on which any payments are due, including by suspending payment for a temporary period; and

(f)           the variation of the terms of this Agreement, as deemed necessary by the Relevant Resolution Authority, to give effect to the exercise of Bail-in Powers by the Relevant Resolution Authority.

For purposes of this Section 17, the following terms shall have the respective meanings set out below:

Bail-in Legislation” shall mean, in relation to a member state of the European Economic Area which has implemented, or which at any time implements, the BRRD, the relevant implementing law, regulation, rule or requirement as described in the EU Bail-in Legislation Schedule from time to time.

Bail-in Powers” shall mean any Write-down and Conversion Powers as defined in the EU Bail-in Legislation Schedule, in relation to the relevant Bail-in Legislation.

BRRD” shall mean Directive 2014/59/EU establishing a framework for the recovery and resolution of credit institutions and investment firms.

BRRD Liability” shall mean a liability in respect of which the relevant Write-down and Conversion Powers in the applicable Bail-in Legislation may be exercised.

EU Bail-in Legislation Schedule” shall mean the document described as such, then in effect, and published by the Loan Market Association (or any successor person) from time to time at http://www.lma.eu.com/.

Relevant Resolution Authority” shall mean the resolution authority with the ability to exercise any Bail-in Powers in relation to any of the Underwriters.

18.         Recognition of the U.S. Special Resolution Regimes.  In the event that any Underwriter that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from such Underwriter of this Agreement, and any interest and obligation in or under this Underwriter , will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.


27




In the event that any Underwriter that is a Covered Entity or a Covered Affiliate of such Underwriter becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against such Underwriter are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States.

For the purposes of this Section 18:

Covered Affiliate” has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k);

Covered Entity” means any of the following:

(i)            a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b);

(ii)           a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or

(iii)          a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b);

Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable; and

U.S. Special Resolution Regime” means each of (i) the U.S. Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the U.S. Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.

[SIGNATURE PAGES FOLLOW]



28



If the foregoing is in accordance with your understanding, please indicate your acceptance of this Agreement by signing in the space provided below.


  Very truly yours,  
     
  B.A.T CAPITAL CORPORATION,  
       

By:
/s/ Neil Wadey  
    Name:  Neil Wadey
 
    Title:  Director
 
       

  BRITISH AMERICAN TOBACCO P.L.C.,  
       

By:
/s/ Tadeu Marroco
 
    Name:  Tadeu Marroco
 
    Title:  Director
 
       

  B.A.T. INTERNATIONAL FINANCE P.L.C.,  
       

By:
/s/ Neil Wadey  
    Name:  Neil Wadey  
    Title:  Director
 
       

  B.A.T. NETHERLANDS FINANCE B.V.,  
       

By:
/s/ M. Wiechers  
    Name
 M. Wiechers
 
    Title  Director
 
       


By:
/s/ JEP Bollen
 
    Name:  JEP Bollen
 
    Title:  Director
 
       

  REYNOLDS AMERICAN INC.,  
       

By:
/s/ John R. Whitener
 
    Name:  John R. Whitener  
    Title:  SVP Controller - Finance and
 
       Accounting and Treasurer
 
   
 

[Signature Page to Underwriting Agreement]




Accepted as of the date hereof, for itself and on behalf of the several Underwriters listed in Schedule I hereto:

  BOFA SECURITIES, INC.  
       

By:
/s/ Maureen O'Connor
 
    Name:  Maureen O'Connor  
    Title:  Managing Director
 
       

  BARCLAYS CAPITAL INC.  
       

By:
/s/ Barbara Mariniello
 
    Name:  Barbara Mariniello
 
    Title:  Managing Director
 
       

  CITIGROUP GLOBAL MARKETS INC.  
       

By:
/s/ Adam D. Bordner
 
    Name:  Adam D. Bordner
 
    Title:  Director
 
       

  DEUTSCHE BANK SECURITIES INC.
 
       

By:
/s/ Christopher J. Kulusic
 
    Name:  Christopher J. Kulusic
 
    Title:
 Director
 
       


By:
/s/ Timothy Azoia
 
    Name:  Timothy Azoia
 
    Title:  Director
 
       

  HSBC SECURITIES (USA) INC.  
       

By:
/s/ Diane Kenna
 
    Name: 
 Diane Kenna
 
    Title:  Managing Director
 
       

[Signature Page to Underwriting Agreement]





SCHEDULE 1

 
Underwriter
 
Principal
Amount of
2024 Notes to
be Purchased
   
Principal
Amount of
2026 Notes to
be Purchased
   
Principal
Amount of
2029 Notes to
be Purchased
   
Principal
Amount of
2049 Notes to
be Purchased
 
BofA Securities, Inc.
 
$
120,000,000
   
$
120,000,000
   
$
60,000,000
   
$
120,000,000
 
Barclays Capital Inc.
 
$
120,000,000
   
$
120,000,000
   
$
60,000,000
   
$
120,000,000
 
Citigroup Global Markets Inc.
 
$
120,000,000
   
$
120,000,000
   
$
60,000,000
   
$
120,000,000
 
Deutsche Bank Securities Inc.
 
$
120,000,000
   
$
120,000,000
   
$
60,000,000
   
$
120,000,000
 
HSBC Securities (USA) Inc.
 
$
120,000,000
   
$
120,000,000
   
$
60,000,000
   
$
120,000,000
 
Bank of China Limited, London Branch
 
$
30,770,000
   
$
30,770,000
   
$
15,385,000
   
$
30,770,000
 
BBVA Securities Inc.
 
$
30,770,000
   
$
30,770,000
   
$
15,385,000
   
$
30,770,000
 
Commerz Markets LLC
 
$
30,770,000
   
$
30,770,000
   
$
15,385,000
   
$
30,770,000
 
J.P. Morgan Securities LLC
 
$
30,769,000
   
$
30,769,000
   
$
15,385,000
   
$
30,769,000
 
Lloyds Securities Inc.
 
$
30,769,000
   
$
30,769,000
   
$
15,385,000
   
$
30,769,000
 
Mizuho Securities USA LLC
 
$
30,769,000
   
$
30,769,000
   
$
15,385,000
   
$
30,769,000
 
NatWest Markets Securities Inc.
 
$
30,769,000
   
$
30,769,000
   
$
15,385,000
   
$
30,769,000
 
Santander Investment Securities Inc.
 
$
30,769,000
   
$
30,769,000
   
$
15,385,000
   
$
30,769,000
 
Scotia Capital (USA) Inc.
 
$
30,769,000
   
$
30,769,000
   
$
15,384,000
   
$
30,769,000
 
SG Americas Securities, LLC
 
$
30,769,000
   
$
30,769,000
   
$
15,384,000
   
$
30,769,000
 
SMBC Nikko Securities America, Inc.
 
$
30,769,000
   
$
30,769,000
   
$
15,384,000
   
$
30,769,000
 
Standard Chartered Bank
 
$
30,769,000
   
$
30,769,000
   
$
15,384,000
   
$
30,769,000
 
UniCredit Capital Markets LLC
 
$
30,769,000
   
$
30,769,000
   
$
15,384,000
   
$
30,769,000
 
Total
 
$
1,000,000,000
   
$
1,000,000,000
   
$
500,000,000
   
$
1,000,000,000
 



S-1



ANNEX A

Additional Time of Sale Information

Pricing term sheets containing the terms of the Notes, substantially in the form of Annex B.






A-1



ANNEX B

B.A.T CAPITAL CORPORATION

Pricing Term Sheet

$3,500,000,000

$1,000,000,000 2.789% Notes due 2024
$1,000,000,000 3.215% Notes due 2026
$500,000,000 3.462% Notes due 2029
$1,000,000,000 4.758% Notes due 2049

September 3, 2019

Issuer:
B.A.T Capital Corporation
 
Guarantors:
British American Tobacco p.l.c.
B.A.T. International Finance p.l.c.
B.A.T. Netherlands Finance B.V.
Reynolds American Inc.
 
Security Title:
2.789% Notes due 2024 (the “2024 Notes”)
3.215% Notes due 2026 (the “2026 Notes”)
3.462% Notes due 2029 (the “2029 Notes”)
4.758% Notes due 2049 (the “2049 Notes” and, together with the 2024 Notes, the 2026 Notes and the 2029 Notes, the “Notes”)

Ranking:
Senior and Unsubordinated
 
Form:
SEC-Registered Global Notes

Principal Amount:
$1,000,000,000 for the 2024 Notes
$1,000,000,000 for the 2026 Notes
$500,000,000 for the 2029 Notes
$1,000,000,000 for the 2049 Notes

Maturity Date:
September 6, 2024 for the 2024 Notes
September 6, 2026 for the 2026 Notes
September 6, 2029 for the 2029 Notes
September 6, 2049 for the 2049 Notes



B-1



Interest Rate:
2.789% per annum for the 2024 Notes
3.215% per annum for the 2026 Notes
3.462% per annum for the 2029 Notes
4.758% per annum for the 2049 Notes
 
Benchmark Treasury:
1.250% due August 31, 2024 for the 2024 Notes
1.375% due August 31, 2026 for the 2026 Notes
1.625% due August 15, 2029 for the 2029 Notes
2.875% due May 15, 2049 for the 2049 Notes
 
Benchmark Treasury Price and Yield:
99-18¼  / 1.339% for the 2024 Notes
99-23+ / 1.415% for the 2026 Notes
101-16 / 1.462% for the 2029 Notes
120-18 / 1.958% for the 2049 Notes
 
Spread to Benchmark Treasury:
+145 bps for the 2024 Notes
+180 bps for the 2026 Notes
+200 bps for the 2029 Notes
+280 bps for the 2049 Notes
 
Yield to Maturity:
2.789% for the 2024 Notes
3.215% for the 2026 Notes
3.462% for the 2029 Notes
4.758% for the 2049 Notes

Day Count Convention:
30/360 (or, in the case of an incomplete month, the
number of days elapsed)
 
Business Day Convention:
Following, Unadjusted
 
Price to Public:
100.000% for the 2024 Notes
100.000% for the 2026 Notes
100.000% for the 2029 Notes
100.000% for the 2049 Notes
 
Net proceeds to Issuer (before Expenses):
$996,500,000 for the 2024 Notes
$996,000,000 for the 2026 Notes
$497,750,000 for the 2029 Notes
$991,250,000 for the 2049 Notes

Expense Reimbursement:
The underwriters have agreed to reimburse the Issuer $2,500,000 for certain fees and expenses relating to the offering.




B-2



Interest Payment Dates:
March 6 and September 6 of each year, beginning on March 6, 2020
 
Interest Payment Record Dates:
The close of business on the fifteenth calendar day preceding each Interest Payment Date, whether or not such day is a Business Day
 
Optional Redemption:
The Issuer may redeem the Notes in whole or in part, at its option, at any time and from time to time before the applicable Par Call Date (as set out in the table below) at a redemption price equal to the greater of (x) 100% of the principal amount of the series of Notes to be redeemed and (y) the sum of the present values of the applicable Remaining Scheduled Payments (as defined in the Prospectus) discounted to the date of redemption on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months or, in the case of an incomplete month, the number of days elapsed) at the Treasury Rate (as defined in the Prospectus), plus the applicable Make-Whole Spread (as set out in the table below) together with accrued and unpaid interest on the principal amount of the series of Notes to be redeemed to, but excluding, the date of redemption.
 
The Issuer may redeem a series of the Notes on or after the applicable Par Call Date at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

 
Series
 
2024 Notes
2026 Notes
2029 Notes
2049 Notes

Par Call Date

August 6, 2024
July 6, 2026
June 6, 2029
March 6, 2049
Make-Whole Spread

25 basis points
30 basis points
30 basis points
45 basis points
Trade Date:
September 3, 2019

Expected Settlement Date:
September 6, 2019 (T+3)
 
Expected Ratings:
[omitted]


B-3



CUSIP:
05526D BG9 for the 2024 Notes
05526D BJ3 for the 2026 Notes
05526D BH7 for the 2029 Notes
05526D BK0 for the 2049 Notes

ISIN:
US05526DBG97 for the 2024 Notes
US05526DBJ37 for the 2026 Notes
US05526DBH70 for the 2029 Notes
US05526DBK00 for the 2049 Notes

Governing Law:
 
State of New York
Listing and Trading:
 
Application will be made to list the Notes on the New York Stock Exchange. No assurance can be given that such application will be granted.

Joint Book-Running Managers:
BofA Securities, Inc.
Barclays Capital Inc.
Citigroup Global Markets Inc.
Deutsche Bank Securities Inc.
HSBC Securities (USA) Inc.

Co-Managers:
Bank of China Limited, London Branch
BBVA Securities Inc.
Commerz Markets LLC
J.P. Morgan Securities LLC
Lloyds Securities Inc.
Mizuho Securities USA LLC
NatWest Markets Securities Inc.
Santander Investment Securities Inc.
Scotia Capital (USA) Inc.
SG Americas Securities, LLC
SMBC Nikko Securities America, Inc.
Standard Chartered Bank
UniCredit Capital Markets LLC


It is expected that delivery of the Notes will be made against payment therefor on or about September 6, 2019, which will be three business days (as such term is used for purposes of Rule 15c6-1 of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”)) following the date hereof (such settlement cycle being referred to as “T+3”).  Under Rule 15c6-1 of the Exchange Act, trades in the secondary market generally are required to settle in two


B-4



business days unless the parties to any such trade expressly agree otherwise.  Accordingly, purchasers who wish to trade the Notes on the date of pricing will be required, by virtue of the fact that the securities initially will settle in T+3, to specify an alternative settlement cycle at the time of any such trade to prevent failed settlement.  Purchasers of the Notes who wish to make such trades should consult their own advisors.

The Issuer and the Guarantors have filed a registration statement (including a Prospectus) with the SEC for the offering to which this communication relates.  Before you invest, you should read the Prospectus in that registration statement and other documents the Issuer and the Guarantors have filed with the Securities and Exchange Commission (the “SEC”) for more complete information about the Issuer, the Guarantors and this offering.  You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov.  Alternatively, any underwriter or any dealer participating in the Offering will arrange to send you the Prospectus if you request it by calling BofA Securities, Inc. toll-free at +1 800 294 1322, Barclays Capital Inc. toll-free at +1 888 603 5847, Citigroup Global Markets Inc. toll-free at +1 800 831 9146, Deutsche Bank Securities Inc. toll-free at +1 800 503 4611, or HSBC Securities (USA) Inc. toll-free at +1 866 811 8049.

This Pricing Term Sheet is only being distributed to and is only directed at persons who (i) are investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) of the United Kingdom (the “Order”), (ii) are persons falling within Article 49(2)(a) to (d) of the Order or (iii) are persons to whom an invitation or inducement to engage in investment activity (within the meaning of Section 21 of the Financial Services and Markets Act 2000 of the United Kingdom, or “FSMA”) in connection with the issue or sale of any Notes may lawfully be communicated or caused to be communicated (all such persons together being referred to as “relevant persons”).  Accordingly, by accepting delivery of this Pricing Term Sheet, the recipient warrants and acknowledges that it is such a relevant person.  The Notes are available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such Notes will be engaged in only with, relevant persons.  Any person who is not a relevant person should not act or rely on this document or any of its contents.  No part of this Pricing Term Sheet should be published, reproduced, distributed or otherwise made available in whole or in part to any other person without the prior written consent of the Issuer.  The Notes are not being offered or sold to any person in the United Kingdom, except in circumstances which will not result in an offer of securities to the public in the United Kingdom within the meaning of Part VI of the FSMA.

Prohibition of sales to European Economic Area (“EEA”) retail investors: The Notes are not intended to be offered, sold or otherwise made available to, and should not be offered, sold or otherwise made available to, any retail investor in the EEA. For these purposes, a retail investor means a person who is one (or more) of (i) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU (as amended, “MiFID II”), (ii) a customer within the meaning of Directive 2002/92/EC (as amended or superseded), where that customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II or (iii) not a qualified investor as defined in Directive 2003/71/EC and any relevant implementing measure in each member state of the EEA. Consequently no key information document required by Regulation (EU) No 1286/2014 (as amended, the “PRIIPs Regulation”) for offering or selling the debt


B-5



securities described in the attached prospectus supplement or otherwise making them available to retail investors in the EEA has been prepared and therefore offering or selling such debt securities or otherwise making them available to any retail investor in the EEA may be unlawful under the PRIIPs Regulation.

To the extent any underwriter that is not a U.S. registered broker-dealer intends to effect any offers or sales of any Notes in the United States, it will do so through one or more U.S. registered broker-dealers in accordance with the applicable U.S. securities laws and regulations.




B-6



ANNEX C

[Form of Opinion of Linklaters LLP]








ANNEX D

[Form of Opinion of Stibbe N.V.]






ANNEX E

[Form of Opinion of Kilpatrick Townsend & Stockton LLP]


 







ANNEX F

[Form of Opinion and 10b-5 Statement of Cravath, Swaine & Moore LLP]



Exhibit 4.1

 

B.A.T CAPITAL CORPORATION
as the Company

INDENTURE

Dated as of September 6, 2019

BRITISH AMERICAN TOBACCO P.L.C.
B.A.T. INTERNATIONAL FINANCE P.L.C.
B.A.T. NETHERLANDS FINANCE B.V.
REYNOLDS AMERICAN INC.
as Guarantors

CITIBANK, N.A.
as Trustee

CITIBANK, N.A.
as Authentication Agent, Transfer Agent, Registrar, Calculation Agent and initial Paying Agent





B.A.T CAPITAL CORPORATION

Reconciliation and tie between Trust Indenture Act of 1939, as amended by the Trust Indenture Reform Act of 1990, and Indenture.

Trust Indenture
 
Act Section
 
Indenture Section
§310
 
(a)(1)
 
6.09
   
(a)(2)
 
6.09
   
(a)(3)
 
Not Applicable
   
(a)(4)
 
Not Applicable
   
(b)
 
6.03, 6.07, 6.09
§311
 
(a)
 
6.11
   
(b)
 
6.09, 6.11
§312
 
(a)
 
2.06
   
(b)
 
10.04
   
(c)
 
10.04
§313
 
(a)
 
6.10
   
(b)
 
6.10
   
(c)
 
6.10
   
(d)
 
6.10
§314
 
(a)
 
4.03(a)
   
(a)(4)
 
4.12
   
(b)
 
Not Applicable
   
(c)(1)
 
10.02(a)
   
(c)(2)
 
10.02(b)
   
(c)(3)
 
Not Applicable
   
(d)
 
Not Applicable
   
(e)
 
10.03
§315
 
(a)
 
6.01(b)
   
(b)
 
6.05
   
(c)
 
6.01(a)
   
(d)
 
6.01(c)
   
(d)(1)
 
6.01(c)(1)
   
(d)(2)
 
6.01(c)(2)
   
(d)(3)
 
6.01(c)(3)
   
(e)
 
5.11
§316
 
(a)(1)(A)
 
5.02, 5.05
   
(a)(1)(B)
 
5.04
   
(a)(2)
 
Not Applicable
   
(a)(last sentence)
 
2.10
   
(b)
 
5.07
   
(c)
 
7.03
§317
 
(a)(1)
 
5.08
   
(a)(2)
 
5.09
   
(b)
 
2.04, 4.05
§318
 
(a)
 
1.04


NOTE: This reconciliation and tie shall not, for any purpose, be deemed to be a part of the Indenture.

i


TABLE OF CONTENTS

Page

ARTICLE I

Definitions and Incorporation by Reference

SECTION 1.01.
Definitions
1
SECTION 1.02.
Other Definitions
6
SECTION 1.03.
Rules of Construction
6
SECTION 1.04.
Incorporation by Reference of Trust Indenture Act
7

ARTICLE II

The Notes

SECTION 2.01.
Amount of Notes
8
SECTION 2.02.
Form and Dating
10
SECTION 2.03.
Execution and Authentication
11
SECTION 2.04.
Registrar and Paying Agent
11
SECTION 2.05.
Paying Agent To Hold Money in Trust
12
SECTION 2.06.
Holder Lists
12
SECTION 2.07.
Transfer and Exchange
13
SECTION 2.08.
Replacement Notes
13
SECTION 2.09.
Outstanding Notes
14
SECTION 2.10.
Treasury Notes
14
SECTION 2.11.
Temporary Notes
15
SECTION 2.12.
Cancellation
15
SECTION 2.13.
Defaulted Interest
15
SECTION 2.14.
CUSIP Number
15
SECTION 2.15.
Deposit of Moneys
16
SECTION 2.16.
Book-Entry Provisions for Global Notes
16
SECTION 2.17.
Computation of Interest
18

ARTICLE III

Redemption and Prepayment

SECTION 3.01.
Election To Redeem; Notices to Trustee
18
SECTION 3.02.
Selection of Notes To Be Redeemed
18
SECTION 3.03.
Notice of Redemption
18
SECTION 3.04.
Effect of Notice of Redemption
19
SECTION 3.05.
Deposit of Redemption Price
20
SECTION 3.06.
Notes Redeemed in Part
20
SECTION 3.07.
Tax Redemption
20


ii


ARTICLE IV

Covenants

SECTION 4.01.
Payment of Principal, Premium and Interest
22
SECTION 4.02.
Maintenance of Office or Agency
22
SECTION 4.03.
Reports by the Company
22
SECTION 4.04.
Corporate Existence
23
SECTION 4.05.
Money for Notes Payments
23
SECTION 4.06.
Payment of Taxes and Other Claims
24
SECTION 4.07.
Stay, Extension and Usury Laws
24
SECTION 4.08.
Payment of Additional Amounts
25
SECTION 4.09.
Negative Pledge
26
SECTION 4.10.
Limitation on Mergers, Consolidations, Amalgamations and Combinations
26
SECTION 4.11.
Statement by Officers as to Event of Default
28
SECTION 4.12.
Statements as to Compliance
28
SECTION 4.13.
Mutual Undertaking Regarding Information Reporting and Collection Obligations
28
SECTION 4.14.
Agent Right to Withhold
29
SECTION 4.15.
Company Right to Redirect
29

ARTICLE V

Defaults and Remedies

SECTION 5.01.
Events of Default
29
SECTION 5.02.
Acceleration of Maturity; Rescission
31
SECTION 5.03.
Other Remedies
32
SECTION 5.04.
Waiver of Past Defaults and Events of Default
33
SECTION 5.05.
Control by Majority
33
SECTION 5.06.
Limitation on Suits
33
SECTION 5.07.
Rights of Holders To Receive Payment
34
SECTION 5.08.
Collection Suit by Trustee
34
SECTION 5.09.
Trustee May File Proofs of Claim
34
SECTION 5.10.
Priorities
35
SECTION 5.11.
Undertaking for Costs
35
SECTION 5.12.
Delay or Omission Not Waiver
35

ARTICLE VI

Trustee

SECTION 6.01.
Duties of Trustee
36
SECTION 6.02.
Rights of Trustee
37
SECTION 6.03.
Individual Rights of Trustee
39
SECTION 6.04.
Trustee’s and Agent’s Disclaimers
39
SECTION 6.05.
Notice of Defaults
39
SECTION 6.06.
Compensation and Indemnity
40
SECTION 6.07.
Replacement of Trustee
41
SECTION 6.08.
Successor Trustee by Consolidation, Merger, etc
42
SECTION 6.09.
Eligibility; Disqualification
43
SECTION 6.10.
Reports by Trustee to Holders
43
SECTION 6.11.
Preferential Collection of Claims Against Company
43

iii


ARTICLE VII

Amendment, Supplement and Waiver

SECTION 7.01.
Without Consent of Holders
43
SECTION 7.02.
With Consent of Holders
45
SECTION 7.03.
Revocation and Effect of Consents
46
SECTION 7.04.
Notation on or Exchange of Notes
47
SECTION 7.05.
Trustee To Sign Amendments, etc
47

ARTICLE VIII

Satisfaction and Discharge of Indenture; Defeasance

SECTION 8.01.
Satisfaction and Discharge of Liability on Notes; Defeasance
47
SECTION 8.02.
Conditions to Defeasance
49
SECTION 8.03.
Deposited Money and Government Obligations To Be Held in Trust; Other Miscellaneous Provisions
50
SECTION 8.04.
Reinstatement
51
SECTION 8.05.
Moneys Held by Paying Agent
51
SECTION 8.06.
Moneys Held
51

ARTICLE IX

Guarantees

SECTION 9.01.
Guarantee
51
SECTION 9.02.
Severability
53
SECTION 9.03.
Limitation of Liability
53
SECTION 9.04.
Contribution
53
SECTION 9.05.
Subrogation
54
SECTION 9.06.
Reinstatement
54
SECTION 9.07.
Release of a Guarantor
54
SECTION 9.08.
Benefits Acknowledged
54

ARTICLE X

Miscellaneous

SECTION 10.01.
Notices
55
SECTION 10.02.
Certificate and Opinion as to Conditions Precedent
57
SECTION 10.03.
Statements Required in Certificate and Opinion
57
SECTION 10.04.
Communications by Holders with Other Holders
57
SECTION 10.05.
Rules by Trustee and Agents
57
SECTION 10.06.
No Personal Liability of Directors, Officers, Employees and Stockholders
58
SECTION 10.07.
Governing Law; Waiver of Jury Trial; Jurisdiction
58
SECTION 10.08.
No Adverse Interpretation of Other Agreements
59
SECTION 10.09.
Successors
59
SECTION 10.10.
Separability
59
SECTION 10.11.
Counterpart Originals; Effectiveness
59
SECTION 10.12.
Table of Contents, Headings, etc
59
SECTION 10.13.
Benefits of Indenture
59
SECTION 10.14.
Appointment of Agent for Service
60


NOTE: This table of contents shall not, for any purpose, be deemed to be a part of the Indenture.

iv


INDENTURE, dated as of September 6, 2019, among B.A.T Capital Corporation, a Delaware corporation, as issuer, British American Tobacco p.l.c., a public limited company incorporated under the laws of England and Wales, B.A.T. International Finance p.l.c., a public limited company incorporated under the laws of England and Wales, B.A.T. Netherlands Finance B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of The Netherlands, and, until its guarantee is released in accordance with this Indenture (if ever), Reynolds American Inc., a North Carolina corporation, as guarantors, Citibank, N.A., as trustee, and Citibank, N.A., as authentication agent, transfer agent, registrar, calculation agent and initial paying agent, unless another paying agent is appointed hereunder prior to the time the Notes are first issued.

Each party agrees as follows for the benefit of the other parties and for the equal and ratable benefit of the Holders of the Notes.

ARTICLE I Definitions and Incorporation by Reference

SECTION 1.01.    Definitions.

Affiliate” means, with respect to any specified Person, any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person.

Agent” means any Authentication Agent, Paying Agent, Transfer Agent, Registrar or Calculation Agent (each, an “Agent” and collectively, the “Agents”).

amend” means amend, modify, supplement, restate or amend and restate, including successively; and “amending” and “amended” have correlative meanings.

Applicable Law” means any applicable law or regulation.

Authority” means any competent regulatory, prosecuting, Tax or governmental authority in any jurisdiction.

Authorized Signatory” means any individual authorized by the Board of Directors to sign documents or otherwise act on behalf of the Company.

Bankruptcy Law” means Title 11, United States Code, or any similar U.S. Federal or state law, the UK Insolvency Act 1986, as amended and as supplemented by the Insolvency (England and Wales) Rules 2016, or law of any other jurisdiction relating to bankruptcy, insolvency, winding-up, liquidation, reorganization or relief of debtors.

BAT Group” means the Parent and its subsidiaries, collectively.

BATIF” means B.A.T. International Finance p.l.c., a public limited company incorporated under the laws of England and Wales, until a successor replaces it in accordance



with the applicable provisions of this Indenture and thereafter means the successor serving hereunder and any and all successors thereto hereunder.

BATNF” means B.A.T. Netherlands Finance B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of The Netherlands, until a successor replaces it in accordance with the applicable provisions of this Indenture and thereafter means the successor serving hereunder and any and all successors thereto hereunder.

Board of Directors” means the board of directors of the Company or any duly authorized committee thereof.

Board Resolution” means a copy of a resolution or appropriate record of action taken pursuant to such resolution, certified by a member of the Board of Directors, the Secretary, Assistant Secretary or Deputy Secretary (or equivalent of any of the foregoing) of the Company to have been duly adopted by the Board of Directors of the Company and to be in full force and effect on the date of such certification, and delivered to the Trustee.

Business Day” means any day which is not, in London or New York City, or any other place of payment, a Saturday, Sunday, legal holiday or a day on which banking institutions are authorized or obligated by law or regulation to close.

Calculation Agent” means Citibank, N.A., as calculation agent.

Code” means the U.S. Internal Revenue Code of 1986, as amended.

Commission” means the U.S. Securities and Exchange Commission.

Company” means B.A.T Capital Corporation, a Delaware corporation, until a successor replaces it in accordance with the applicable provisions of this Indenture and thereafter means the successor serving hereunder and any and all successors thereto hereunder.

Company Order” means a written request or order signed in the name of the Company by any Officer, and delivered to the Trustee or any Agent, as applicable.

Corporate Trust Office of the Trustee/Paying Agent” means (i) with respect to the Trustee and any Paying Agent appointed for Notes of a series denominated in Dollars, the office of the Trustee at which at any particular time its corporate trust business shall be administered, which office as of the date of this Indenture is (a) solely for purposes of surrender for registration of transfer or exchange or for presentation for payment or repurchase or for conversion is located at 480 Washington Boulevard, 30th Floor, Jersey City, New Jersey, Attention: Agency & Trust – B.A.T Capital Corporation, and (b) for all other purposes is located at 388 Greenwich Street, New York, New York 10013, Attention: Agency & Trust – B.A.T Capital Corporation, or such other address as the Trustee may designate from time to time by notice to the Holders and the Company and (ii) with respect to any Paying Agent appointed for Notes of a series denominated in any Non-Dollar Currency, the office of the Paying Agent as notified in writing by the Paying Agent to the Company.

2


corporation” includes corporations, associations, companies (including any limited liability company), business trusts and limited partnerships.

Default” means any event which is, or after notice or passage of time or both would be, an Event of Default.

Depositary” means, with respect to the Notes of any series issuable or issued in whole or in part in global form, the Person specified pursuant to Section 2.01 as the initial Depositary with respect to the Notes of such series, until a successor shall have been appointed and become such pursuant to the applicable provision of this Indenture, and thereafter “Depositary” shall mean or include such successor.

Dollar” and “$” each refer to United States dollars, or such other money of the United States that at the time of payment is legal tender for payment of public and private debts.

EMTN Programme” means the Euro Medium Term Note Programme to which BATIF, the Company and BATNF are parties as the issuers under the programme and notes issued thereunder are guaranteed by the Parent, each of the issuers thereunder (except when it is the relevant issuer) and RAI, as amended from time to time.

Event of Default” has the meaning set forth in Section 5.01.

Exchange Act” means the Securities Exchange Act of 1934, as amended, or any successor statute, and the rules and regulations promulgated by the Commission thereunder.

Government Obligations” means, with respect to a series of Notes, direct obligations of the government that issues the currency in which the Notes of the series are payable for the payment of which the full faith and credit of such government is pledged, or obligations of a Person controlled or supervised by and acting as an agency or instrumentality of such government, the payment of which is unconditionally guaranteed as a full faith and credit obligation by such government.

Governmental Authority” means the government of the United States of America, any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

Guarantee” means the guarantee of any Guarantor given under Section 9.01.

Guarantors” means, until released in accordance with the terms of this Indenture (if ever), the Persons named as guarantors in the introductory paragraph hereto, and any other Person that becomes a guarantor from time to time hereto pursuant to the terms hereof, until a successor replaces such Person in accordance with the applicable provisions of this Indenture and thereafter means the successor serving hereunder and any and all successors thereto hereunder.

3


Holder” means the Person in whose name a Note is registered on the Note register.

IFRS” means international financial reporting standards as issued by the International Accounting Standards Board and endorsed from time to time by the European Union or any variation thereof with which the Company, the Parent or the Subsidiary Guarantors are, or may be, required to comply.

Indenture” means this Indenture as amended or supplemented from time to time pursuant to the provisions hereof, and includes the terms of a particular series of Notes established as contemplated by Section 2.01.

interest” means, unless the context otherwise requires, interest payable on any Notes, and with respect to an Original Issue Discount Note that by its terms bears interest only after maturity, interest payable after maturity.

Interest Payment Date,” with respect to any Note, has the meaning assigned to such term in the Officer’s Certificate or any supplemental indenture setting forth the terms of such Note, as contemplated by Section 2.01.

Maturity Date,” when used with respect to any Note, means the date on which the principal amount of such Note becomes due and payable as therein or herein provided.

Non-Dollar Currency” means any currency other than Dollars.

Notes” means securities evidencing the Company’s unsecured senior indebtedness issued in one or more series from time to time under this Indenture.

Officer” means any director, any manager, the chief executive officer, the chief financial officer, the president or a vice president, the treasurer, an assistant treasurer, the controller, the secretary or an assistant secretary (or equivalent) of the specified Person, or in the case of the Company, an Authorized Signatory.

Officer’s Certificate” means a certificate signed by an Officer of the Parent or the Company, and delivered to the Trustee.

Opinion of Counsel” means a written opinion from legal counsel, who is acceptable to the Trustee, delivered to the Trustee.  The counsel may be an employee of, or counsel to, the Company or any Guarantor.

Original Issue Discount Note” means any Note that is issued with “original issue discount” within the meaning of Section 1273(a) of the Code and Treasury Regulations promulgated thereunder and any other Note designated by the Company as issued with original issue discount for United States federal income tax purposes.

Parent” means British American Tobacco p.l.c., a public limited company incorporated under the laws of England and Wales, until a successor replaces it in accordance

4


with the applicable provisions of this Indenture and thereafter means the successor serving hereunder and any and all successors thereto hereunder.

Person” means any individual, corporation, partnership, joint venture, association, limited liability company, joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.

Physical Notes” means certificated Notes (other than Global Notes) in registered form.

Place of Payment,” when used with respect to the Notes, means the place or places where the principal of (and premium, if any) and interest on the Notes are payable as specified as contemplated by Section 4.02.

Quoted Borrowing” means any indebtedness which: (i) is represented by notes, debentures or other securities issued otherwise than to constitute or represent advances made by banks and/or other lending institutions; (ii) is denominated, or confers any right to payment of principal and/or interest, in or by reference to any currency other than the currency of the country in which the issuer of the indebtedness has its principal place of business or is denominated, or confers any right to payment of principal and/or interest, in or by reference to the currency of such country but is sold or subscribed by or on behalf of, or by agreement with, the issuer of such indebtedness as to over 20% outside such country; and (iii) at its date of issue is, or is intended by the issuer of such indebtedness to become, quoted, listed, traded or dealt in on any stock exchange or other organized and regulated securities market in any part of the world.

RAI” means Reynolds American Inc., a North Carolina corporation, until a successor replaces it in accordance with the applicable provisions of this Indenture and thereafter means the successor serving hereunder and any and all successors thereto hereunder.

Redemption Date,” when used with respect to any Note to be redeemed pursuant to Article III of this Indenture, means the date fixed for such redemption pursuant to the terms of such Article III.

Redemption Price,” when used with respect to any Note to be redeemed, means the price at which it is to be redeemed pursuant to this Indenture.

Responsible Officer” means, when used with respect to the Trustee, any officer of the Trustee within the corporate trust department (or any successor unit) of the Trustee located at the Corporate Trust Office of the Trustee/Paying Agent who has direct responsibility for the administration of this Indenture and shall also mean any other officer of the Trustee to whom any corporate trust matter is referred because of such officer’s knowledge of and familiarity with the particular subject.

Securities Act” means the Securities Act of 1933, as amended, or any successor statute, and the rules and regulations promulgated by the Commission thereunder.

series” refers to any separate series of Notes issued under this Indenture.

5


Stated Maturity” means, when used with respect to any indebtedness or any installment of interest thereon, the dates specified in such indebtedness as the fixed date on which the principal of such indebtedness or such installment of interest, as the case may be, is due and payable.

TIA” means the Trust Indenture Act of 1939, as amended (15 U.S. Code §§ 77aaa-77bbbb) or any successor statute, and the rules and regulations promulgated by the Commission thereunder.

Trustee” means, unless otherwise specified in accordance with Section 2.01(l), Citibank, N.A., until a successor replaces it in accordance with the applicable provisions of this Indenture and thereafter means the successor serving hereunder.

U.S. Person” means a U.S. Person as defined in Rule 902(k) promulgated under the Securities Act.

SECTION 1.02.    Other Definitions.

Term
Defined in Section
“Additional Amounts”
4.08
“Authentication Agent”
2.03
“Agent Member”
2.16
“Change in Tax Law”
3.07
“Covenant Defeasance”
8.01
“Exchange Rate”
2.09
“FATCA Withholding”
4.08
“Global Notes”
2.16
“Legal Defeasance”
8.01
“Paying Agent”
2.04
“Registrar”
2.04
“Relevant Taxing Jurisdiction”
4.08
“Subsidiary Guarantor”
9.07
“Taxes”
4.08
“Transfer Agent”
2.04

SECTION 1.03.    Rules of Construction.

Unless the context otherwise requires:

(a)    a term has the meaning assigned to it herein, whether defined expressly or by reference;

(b)    unless otherwise specified herein, all accounting terms used herein shall be interpreted, all accounting determinations hereunder shall be made, and all financial statements required to be delivered hereunder shall be prepared in accordance with IFRS;

(c)    “or” is not exclusive;

6


(d)    words in the singular include the plural, and in the plural include the singular;

(e)    “will” shall be interpreted to express a command;

(f)    words used herein implying any gender shall apply to both genders;

(g)    “herein,” “hereof,” “hereunder” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subsection;

(h)    “£” and “pounds sterling” each refer to British pounds sterling, or such other money of the United Kingdom that at the time of payment is legal tender for payment of public and private debts;

(i)    references to sections of or rules under the Securities Act will be deemed to include substitute, replacement of successor sections or rules adopted by the Commission from time to time;

(j)    references to Sections, Articles or Exhibits are references to Sections, Articles or Exhibits of or to this Indenture unless context otherwise requires; and

(k)    references to the payment of principal amount of Notes shall, in the case of Original Issue Discount Notes, be read as payment of such portion of principal amount as may be specified in the terms of such series.

SECTION 1.04.    Incorporation by Reference of Trust Indenture Act.

Whenever this Indenture refers to a provision of the TIA, the portion of such provision required to be incorporated herein in order for this Indenture to be qualified under the TIA is incorporated by reference in and made a part of this Indenture, mutatis mutandis.  The following TIA terms have the following meanings used in this Indenture:

indenture securities” means the Notes.

indenture security holder” means a Holder.

indenture to be qualified” means this Indenture.

indenture trustee” or “institutional trustee” means the Trustee.

obligor on this indenture securities” means the Company or any other obligor on the Notes.

All other terms used in this Indenture (other than those defined herein) that are defined by the TIA, defined in the TIA by reference to another statute or defined by Commission rule have the meanings therein assigned to them.

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If any provision hereof limits, qualifies or conflicts with the duties imposed by any of Sections 310 through 317, inclusive, of the TIA through the operation of Section 318(c) thereof, such imposed duties shall control.

ARTICLE II The Notes

SECTION 2.01.    Amount of Notes.

The aggregate principal amount of Notes that may be authenticated by the Authentication Agent and delivered under this Indenture is unlimited.

The Notes may be issued in one or more series for original issue.  There shall be established in or pursuant to authority granted by one or more Board Resolutions and set forth in an Officer’s Certificate or established in one or more indentures supplemental hereto, prior to the issuance of any series of Notes, all or any of the following, as applicable (each of which, if so provided, may be determined from time to time by the Company with respect to unissued Notes of that series and set forth in the Notes of that series when issued from time to time):

(a)    the title of the Notes of that series (which shall distinguish the Notes of that series from all other series of Notes);

(b)    any limit upon the aggregate principal amount of the Notes of that series which may be authenticated and delivered under this Indenture (except for Notes authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Notes of that series pursuant to Section 2.07, 2.08, 2.11, 3.06 or 7.04);

(c)    the dates on which or periods during which the Notes of that series may be issued and the Maturity Date for the Notes of that series (or manner of determining the same) (which, if so provided in such Officer’s Certificate or any supplemental indenture, may be determined by the Company from time to time and set forth in the Notes of that series issued from time to time);

(d)    the rate or rates (or the manner of calculation thereof) at which the Notes of that series shall bear interest (if any), the date or dates from which such interest shall accrue, the Interest Payment Dates on which such interest shall be payable (or manner of determining the same) and the regular record date for the interest payable on any Notes on any Interest Payment Date and the extent to which, or the manner in which, any interest is payable on a temporary Global Note on an Interest Payment Date;

(e)    the place or places where, subject to the provisions of Section 4.02, the principal of, and premium, if any, and interest, if any, and Additional Amounts, if any, on Notes of that series shall be payable, any Notes of that series may be surrendered for registration of transfer, any Notes of that series may be surrendered for exchange, and notices and demands to or upon the Company in respect of the Notes of that series and this Indenture may be served;

(f)    the period or periods within which (or manner of determining the same), the price or prices at which (or manner of determining the same), the currency or currency unit in which, and the terms and conditions upon which Notes of that series may be redeemed, in whole

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or in part, at the option of the Company, and any remarketing arrangements with respect to the Notes of that series;

(g)    the denominations in which any Notes of that series shall be issuable, if other than denominations of $2,000 and any integral multiple of $1,000 in excess thereof (or in the case of Notes denominated in a Non-Dollar Currency, the equivalent thereof in each case (rounded to an integral multiple of 1,000 units of such Non-Dollar Currency));

(h)    if Non-Dollar Currency, the currency, currencies or currency units in which the principal of or any premium or interest or Additional Amounts on any Notes of that series shall be payable;

(i)    if other than the entire principal amount thereof, the portion of the principal amount of Notes of that series which shall be payable upon a declaration of acceleration of the Maturity Date thereof pursuant to Section 5.02;

(j)    any Events of Default and covenants of the Company with respect to the Notes of that series, whether or not such Events of Default or covenants are consistent with the Events of Default or covenants set forth herein;

(k)    if a Person other than Citibank, N.A. is to act as Trustee for the Notes of that series, the name and location of the Corporate Trust Office of such Trustee;

(l)    if other than as set forth in Article VIII, provisions for the satisfaction and discharge of this Indenture with respect to the Notes of that series;

(m)    the date as of which any Global Note representing outstanding Notes of that series shall be dated if other than the date of original issuance of the first Note of that series to be issued;

(n)    the application, if any, of Section 4.08 to the Notes of that series;

(o)    whether the Notes of that series shall be issued in whole or in part in the form of a Global Note or Notes and, in such case, the initial Depositary, if any, for such Global Note or Notes, whether such global form shall be permanent or temporary;

(p)    if Notes of that series are to be issuable initially in the form of a temporary Global Note, the circumstances under which the temporary Global Note can be exchanged for definitive Notes and whether the definitive Notes will be in global form;

(q)    whether the Notes of that series will be convertible or exchangeable into other securities of the Company or another Person, and if so, the terms and conditions upon which such Notes will be so convertible or exchangeable, including the conversion price or exchange rate and the conversion or exchange period, and any additions or changes to the Indenture with respect to the Notes of such series to permit or facilitate such conversion or exchange;

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(r)    whether the Notes of that series are to be issued as Original Issue Discount Notes and the amount of discount with which the Notes of that series may be issued;

(s)    the form of the Notes of that series; and

(t)    any other terms of that series (which terms shall not be inconsistent with the provisions of this Indenture).

All Notes of any particular series shall be substantially identical except as to issue date, issue price, denomination, rate of interest, Maturity Date and the date from which interest, if any, shall accrue, and except as may otherwise be provided in or pursuant to such Officer’s Certificate or any supplemental indenture relating thereto.  All Notes of any one series need not be issued at the same time, and unless otherwise provided, a series may be reopened for issuance of additional Notes of such series.

Notwithstanding anything else in this Indenture to the contrary, at the Company’s option, additional notes in respect of any series of Notes may be issued with the same CUSIP number as the Notes of any applicable series initially issued under this Indenture; provided that the Company has furnished an Opinion of Counsel to the Trustee confirming that all conditions precedent to the issuance and authentication of the Notes have been complied with and that such issuance would not conflict with federal and state securities laws and the rules and regulations of the Commission.  Such additional notes of any series will have substantially identical terms and conditions as the applicable Notes initially issued under this Indenture of such series in all respects, except as described in the paragraph above and will be treated as a single class for all purposes under this Indenture, including, without limitation, waivers, amendments, redemptions and offers to purchase; provided that any such additional notes that have the same CUSIP, ISIN or other identifying number as the outstanding notes of a series must be fungible with the outstanding notes of that series for U.S. federal income tax purposes.

SECTION 2.02.    Form and Dating.

Each Note shall be dated the date of its authentication.  The Authentication Agent’s certificate of authentication on all Notes shall be in substantially the following form: “This is one of the Notes of the series designated herein referred to in the within-mentioned Indenture”.

The terms and provisions contained in the Notes shall constitute, and are expressly made, a part of this Indenture and, to the extent applicable, the Company, the Guarantors, the Trustee and each Agent, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and agree to be bound thereby.  However, to the extent any provision of any Note conflicts with the express provisions of this Indenture, the provisions of this Indenture shall control and be binding.

The Notes of any particular series may be presented for registration of transfer and exchange at the offices of the Registrar.

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SECTION 2.03.    Execution and Authentication.

The Notes shall be executed on behalf of the Company by any Officer.  The signature of any of these Officers on the Notes may be manual or facsimile.

If an Officer whose signature is on a Note was an Officer at the time of such execution but no longer holds that office at the time the Authentication Agent authenticates the Note, the Note shall be valid nevertheless.

No Note shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose unless there appears on such Note a certificate of authentication substantially in the form provided for herein executed by the Authentication Agent by manual signature, and such certificate upon any Note shall be conclusive evidence, and the only evidence, that such Note has been duly authenticated and delivered hereunder.  Notwithstanding the foregoing, if any Note shall have been authenticated and delivered hereunder but never issued and sold by the Company, and the Company shall deliver such Note to the Paying Agent for cancellation as provided in Section 2.12, for all purposes of this Indenture such Note shall be deemed never to have been authenticated and delivered hereunder and shall never be entitled to the benefits of this Indenture.

The Notes of each series shall be issuable in such denominations as shall be specified as contemplated by Section 2.01.  In the absence of any such provisions with respect to the Notes of any series, the Notes of such series denominated in Dollars shall be issuable in denominations of $2,000 and integral multiples of $1,000 in excess thereof and the Notes of such series denominated in a Non-Dollar Currency shall be issuable in denominations equivalent to $2,000 and integral multiples equivalent to $1,000 in excess thereof in that Non-Dollar Currency (in each case rounded to an integral multiple of 1,000 units of such Non-Dollar Currency).

The Trustee may appoint an authenticating agent (the “Authentication Agent”) acceptable to the Company to authenticate Notes.  Any such appointment shall be evidenced by an instrument signed by a Responsible Officer, a copy of which shall be furnished to the Company.  The Trustee hereby appoints with due care Citibank, N.A., as the Authentication Agent, and Citibank, N.A. hereby accepts such appointment.  The Company hereby confirms this appointment as acceptable to it.  The Trustee shall have no responsibility to compensate, reimburse or indemnify the Authentication Agent.  The Trustee may change the Authentication Agent without prior notice to the Holders; provided the Authentication Agent is acceptable to the Company.

SECTION 2.04.    Registrar and Paying Agent.

The Company shall maintain an office or agency where Notes may be presented for registration of transfer or for exchange (the “Registrar”), an office or agency where Notes may be presented for payment (the “Paying Agent”) and an office or agency where notices and demands to or upon the Company, if any, in respect of the Notes and this Indenture may be served.  The Registrar shall keep a register of the Notes and of their transfer and exchange.  The Company may have one or more additional Paying Agents and for each series of Notes denominated in a Non-Dollar Currency, the Company shall appoint a separate Paying Agent

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under a supplemental indenture which supplemental indenture shall be in form and substance acceptable to such Paying Agent.  Money held by such Paying Agent shall be held as banker, not subject to the UK FCA Client Money Rules, and need not be segregated except as required by law.  The term “Paying Agent” includes any additional Paying Agent.  The Company shall also appoint a transfer agent (the “Transfer Agent”).

The Company shall enter into an appropriate agency agreement, which shall incorporate the provisions of the TIA, with any Agent that is not a party to this Indenture.  Such agreement shall implement the provisions of this Indenture that relate to such Agent.  The Company shall notify the Trustee of the name and address of any such Agent.  If the Company fails to maintain a Registrar or Paying Agent, or fails to give the foregoing notice, the Trustee shall act as such and shall be entitled to appropriate compensation in accordance with Section 6.06.

The Company initially appoints Citibank, N.A., as Registrar, Transfer Agent, Paying Agent, and Calculation Agent in connection with the Notes and this Indenture, unless another Paying Agent is appointed prior to the time the Notes of any applicable series are first issued, and the registered office of Citibank, N.A., as the office or agency of the Company for such purposes, and the Company may change the Paying Agent, Registrar, Transfer Agent or Calculation Agent without prior notice to the Holders.  The Company or any of its subsidiaries may act as Paying Agent, Transfer Agent, Registrar or Calculation Agent.

SECTION 2.05.    Paying Agent To Hold Money in Trust.

Each Paying Agent shall hold in trust for the benefit of the Holders or the Trustee all money held by the Paying Agent for the payment of principal of, premium, if any, or interest on the Notes (whether such money has been paid to it by the Company or any other obligor on the Notes), and the Company and the Paying Agent shall notify the Trustee of any default by the Company (or any other obligor on the Notes) in making any such payment.  In no event shall the Paying Agent be liable for any interest on any money received by it hereunder; provided that if the Company or an Affiliate thereof acts as Paying Agent, it shall segregate the money held by it as Paying Agent and hold such money in a separate trust fund.  The Company at any time may require the Paying Agent to pay all money held by it to the Trustee and account for any funds disbursed, and the Trustee may at any time during the continuance of the Event of Default specified in Section 5.01(a), upon written request to the Paying Agent, require the Paying Agent to pay forthwith all money so held by it to the Trustee and to account for any funds disbursed.  Upon making such payment, the Paying Agent shall have no further liability for the money delivered to the Trustee.

SECTION 2.06.    Holder Lists.

The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of the Holders of each series of Notes.  If the Trustee is not the Registrar, the Company shall furnish or cause to be furnished to the Trustee (i) at least five Business Days before each Interest Payment Date with respect to such series of Notes outstanding on the record date relating to such Interest Payment Date, but in any event not less frequently than semi-annually, and (ii) at such other times as the Trustee may

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request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of the Holders of such series; provided that, as long as the Trustee is the Registrar, no such list need be furnished.

SECTION 2.07.    Transfer and Exchange.

Subject to Section 2.16, when Notes are presented to the Transfer Agent with a request from the Holder of such Notes to register a transfer or to exchange them for an equal principal amount of Notes of other authorized denominations of the same series, the Transfer Agent shall register the transfer as requested.  Every Note presented or surrendered for registration of transfer or exchange shall be duly endorsed or be accompanied by a written instrument of transfer in form satisfactory to the Company and the Transfer Agent, duly executed by the Holder thereof or its attorney duly authorized in writing.  To permit registrations of transfers and exchanges, the Company shall issue and execute, and the Authentication Agent shall authenticate, new Notes evidencing such transfer or exchange at the Transfer Agent’s request.  No service charge shall be made to the Holder for any registration of transfer or exchange.  The Company may require from the Holder payment of a sum sufficient to cover any transfer taxes or other governmental charge that may be imposed in relation to a transfer or exchange, but this provision shall not apply to any exchange pursuant to Section 2.11, 3.06 or 7.04 (in which events the Company shall be responsible for the payment of such taxes).  The Transfer Agent shall not be required to exchange or register a transfer of (i) any Notes for a period of 15 days ending on the due date for any payment of principal in respect of the Notes or (ii) any Notes selected, called or being called for redemption.

Any Holder of a Global Note shall, by acceptance of such Global Note, agree that transfers of the beneficial interests in such Global Note may be effected only through a book entry system maintained by the Holder of such Global Note (or its agent), and that ownership of a beneficial interest in the Global Note shall be required to be reflected in a book-entry system.

SECTION 2.08.    Replacement Notes.

If a mutilated Note of any series is surrendered to the Registrar or the Trustee, if surrendered to the Trustee to be forwarded to the Registrar, or if the Holder of a Note of any series claims that the Note has been lost, destroyed or wrongfully taken, the Company shall issue and the Authentication Agent shall authenticate a replacement Note of such series if the Holder of such Note furnishes to the Company and the Authentication Agent, with a copy to the Trustee, evidence reasonably acceptable to them of the ownership and the destruction, loss or theft of such Note and if the requirements of Section 8-405 of the New York Uniform Commercial Code as in effect on the date of this Indenture are met.  If required by the Authentication Agent or the Company, an indemnity bond shall be posted, sufficient in the judgment of all to protect the Company, the Trustee or any Agent from any loss that any of them may suffer if such Note is replaced.  The Company may charge such Holder for the Company’s reasonable out-of-pocket expenses in replacing such Note and the Authentication Agent may charge the Company for the Authentication Agent’s reasonable expenses (including, without limitation, attorneys’ fees and disbursements) in replacing such Note.  Every replacement Note shall constitute a contractual obligation of the Company.

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SECTION 2.09.    Outstanding Notes.

The Notes outstanding at any time are all Notes that have been authenticated by the Authentication Agent except for (i) those canceled by it; (ii) those delivered to it for cancellation; (iii) to the extent set forth in Sections 8.01 and 8.02, on or after the date on which the conditions set forth in Section 8.01 or 8.02 have been satisfied, those Notes theretofore authenticated and delivered by the Authentication Agent hereunder; and (iv) those described in this Section 2.09 as not outstanding.  Subject to Section 2.10, a Note does not cease to be outstanding because the Company or one of its Affiliates holds the Note.

If a Note is replaced pursuant to Section 2.08, it ceases to be outstanding unless the Authentication Agent, with a copy to the Trustee, receives proof satisfactory to it that the replaced Note is held by a bona fide purchaser in whose hands such Note is a legal, valid and binding obligation of the Company.

If the Paying Agent holds, in its capacity as such, on any Maturity Date, money sufficient to pay all accrued interest and principal with respect to the Notes payable on that date and is not prohibited from paying such money to the Holders thereof pursuant to the terms of this Indenture, then on and after that date such Notes cease to be outstanding and interest on them ceases to accrue.

For each series of Original Issue Discount Notes, the principal amount of such Notes that shall be deemed to be outstanding and used to determine whether the necessary Holders have given any request, demand, authorization, direction, notice, consent or waiver shall be the amount of the principal thereof that would be due and payable as of the date of such determination upon a declaration of acceleration of the maturity thereof pursuant to Section 5.02.

For each series of Notes denominated in a Non-Dollar Currency, the principal amount of such Notes that shall be deemed to be outstanding and used to determine whether the necessary Holders have given any request, demand, authorization, direction, notice, consent or waiver shall be the Dollar equivalent, as determined by the Company by reference to the noon buying rate in New York for cable transfers for such currency, as such rate is certified for customs purposes by the Federal Reserve Bank of New York (the “Exchange Rate”) on the date of original issuance of such Notes, of the principal amount (or, in the case of Original Issue Discount Notes, the Dollar equivalent, as determined by the Company by reference to the Exchange Rate on the date of the original issuance of such Notes, of the amount determined as provided above), of such Notes.

SECTION 2.10.    Treasury Notes.

In determining whether the Holders of the required principal amount of Notes of a series have concurred in any declaration of acceleration or notice of default or direction, waiver or consent or any amendment, modification or other change to this Indenture, Notes owned by the Company or any other Affiliate of the Company shall be disregarded as though they were not outstanding, except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent or any amendment, modification or other change to this Indenture, only Notes as to which a Responsible Officer of the Trustee has

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actually received an Officer’s Certificate stating that such Notes are so owned shall be so disregarded.  Notes so owned which have been pledged in good faith shall not be disregarded if the pledgee established to the satisfaction of the Trustee the pledgee’s right so to act with respect to the Notes and that the pledgee is not the Company, any other obligor on the Notes or any of their respective Affiliates.

SECTION 2.11.    Temporary Notes.

Until definitive Notes are prepared and ready for delivery, the Company may prepare and the Authentication Agent shall authenticate temporary Notes.  Temporary Notes shall be substantially in the form of definitive Notes but may have variations that the Company considers appropriate for temporary Notes.  Without unreasonable delay, the Company shall prepare and the Authentication Agent shall authenticate definitive Notes in exchange for temporary Notes.  Until such exchange, temporary Notes shall be entitled to the same rights, benefits and privileges as definitive Notes.

SECTION 2.12.    Cancellation.

The Company at any time may deliver Notes of any series to the applicable Paying Agent for cancellation.  The Registrar shall forward to the Paying Agent any Notes surrendered to it for registration of transfer, exchange or payment.  The Paying Agent shall cancel all Notes surrendered for registration of transfer, exchange, payment, replacement or cancellation and shall deliver evidence of such canceled Notes to the Company upon the Company’s request.  The Company may not reissue or resell, or issue new Notes to replace Notes that the Company has redeemed or paid, or that have been delivered to the Paying Agent for cancellation (other than in accordance with this Indenture).

SECTION 2.13.    Defaulted Interest.

If the Company defaults on a payment of interest on any series of Notes, and the applicable grace period shall have expired, it may at its option pay the defaulted interest, in accordance with the terms hereof, to the Persons who are Holders on a subsequent record date (which shall not be less than five Business Days prior to the date of payment of such defaulted interest), and the Company will notify such Holders of such record date.  The Company may make payment of any defaulted interest in any other lawful manner not inconsistent with the requirements (if applicable) of any securities exchange on which such series of Notes may be listed and, upon such notice as may be required by such exchange, if, after written notice given by the Company to the Trustee and the Paying Agent of the proposed payment pursuant to this sentence, such manner of payment shall be deemed practicable by the Trustee.

SECTION 2.14.    CUSIP Number.

The Company in issuing any series of Notes may use a “CUSIP,” “ISIN” or other similar number, and if so, such CUSIP, ISIN or other similar number shall be included in notices of redemption or exchange as a convenience to Holders; provided that any such notice may state that no representation is made as to the correctness or accuracy of the CUSIP, ISIN or other similar number printed in the notice or on the applicable series of Notes, and that reliance may be placed only on the other identification numbers printed on such Notes.  The Company shall

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promptly notify the Trustee and the Paying Agent of any such CUSIP, ISIN or other similar number used by the Company in connection with the issuance of any series of Notes and of any change in the CUSIP, ISIN or other similar number.

SECTION 2.15.    Deposit of Moneys.

With respect to the Notes of a series denominated in Dollars, prior to 11:00 A.M., New York time, and, with respect to the Notes of a series denominated in any Non-Dollar Currency, prior to 11:00 A.M., London time, or as advised by the Paying Agent in relation to any Non-Dollar Currency other than euro and pounds sterling, on each Interest Payment Date (or, if such Interest Payment Date is not a Business Day, the day on which such interest payment is made) and Maturity Date (or, if such Maturity Date is not a Business Day, the day on which such principal payment is made), the Company shall have deposited with the applicable Paying Agent in immediately available funds money sufficient to make cash payments, if any, due on such Interest Payment Date or Maturity Date, as the case may be, in a timely manner which permits such Paying Agent to remit payment to the Holders on such Interest Payment Date (or, if such Interest Payment Date is not a Business Day, the day on which such interest payment is made) or Maturity Date (or, if such Maturity Date is not a Business Day, the day on which such principal payment is made), as the case may be.  The principal and interest on a Global Note shall be payable to the Depositary of such Global Note or its nominee, as the case may be, as the sole registered owner and the sole Holder of the Notes represented thereby.  The principal and interest on Physical Notes shall be payable, either in person or by mail, at the office of the applicable Paying Agent.

SECTION 2.16.    Book-Entry Provisions for Global Notes.

(a)    Any series of Notes may initially be represented by one or more Notes of the same series in registered, global form without interest coupons.  Any global notes representing the Notes (collectively, the “Global Notes”) initially shall (i) be registered in the name of the Depositary or the nominee of such Depositary, in each case for credit to an account of a member of, or direct or indirect participant in, the Depositary (an “Agent Member”); and (ii) be delivered to Citibank, N.A. as custodian for such Depositary.

(b)    Agent Members shall have no rights under this Indenture with respect to any Global Note held on their behalf by the Depositary, or its custodian, or under the Global Notes, and the Depositary may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of the Global Note for all purposes whatsoever.  Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee or any agent of the Company, any Agent or the Trustee from giving effect to any written certification, proxy or other authorization (which may be in electronic form) furnished by the Depositary or impair, as between the Depositary and its Agent Members, the operation of customary practices governing the exercise of the rights of a Holder of any Note.

(c)    None of the Company, any Guarantor, the Trustee, the Registrar, any Paying Agent or any agent of any of them shall have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests in the Notes, for maintaining, supervising or reviewing any records relating to such beneficial owner

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interests, or for any acts or omissions of a Depositary or for any transactions between a Depositary and any beneficial owner or between or among beneficial owners.  No owner of a beneficial interest in the Notes shall have any rights under this Indenture, and the Depositary or its nominee, if any, shall be deemed and treated by the Company, any Guarantor, the Trustee, the Registrar, any Paying Agent or any agent of any of them as the absolute owner and Holder of such Notes for all purposes whatsoever.  Notwithstanding the foregoing, nothing herein shall prevent the Company, any Guarantor, the Trustee, the Registrar, any Paying Agent or any agent of any of them from giving effect to any written certification, proxy or other authorization furnished by a Depositary, or any of its members and any other Person on whose behalf such member may act, the operation of customary practices of such Persons governing the exercise of the rights of a beneficial owner of any Notes.

(d)    Transfers and exchanges pursuant to this Section 2.16 may only be made between Notes of the same series.  Transfers of Global Notes shall be limited to transfers in whole, but not in part, to the Depositary, its successors or their respective nominees.  Interests of beneficial owners in the Global Notes may be transferred or exchanged for Physical Notes in accordance with the rules and procedures of the Depositary.  In addition, a Global Note shall be exchangeable for Physical Notes if (i) the Depositary (x) notifies the Company that it is unwilling or unable to continue as depositary for such Global Note or (y) has ceased to be registered as a clearing agency under the Exchange Act, and, with respect to (x) or (y), the Company thereupon fails to appoint a successor depositary within 90 days of such notice or cessation; (ii) the Company, at its option, notifies the Trustee and the Authentication Agent in writing that it elects to effect the issuance of Physical Notes or (iii) upon the request of the Depositary at any time that there shall have occurred and be continuing an Event of Default with respect to the Notes.  In all cases, Physical Notes delivered in exchange for any Global Note or beneficial interests therein shall be registered in the names, and issued in any approved denominations, requested by or on behalf of the Depositary (in accordance with its customary procedures).

(e)    In connection with any transfer or exchange of a portion of the beneficial interest in any Global Note to beneficial owners pursuant to paragraph (b) of this Section 2.16, the Registrar shall (if one or more Physical Notes are to be issued) reflect on its books and records the date and a decrease in the principal amount of the Global Note in an amount equal to the principal amount of the beneficial interest in the Global Note to be transferred, and the Company shall execute, and the Authentication Agent shall upon receipt of a Company Order from the Company authenticate and make available for delivery, one or more Physical Notes of like tenor and amount.

(f)    In connection with the transfer of Global Notes of a series as an entirety to beneficial owners pursuant to paragraph (b) of this Section 2.16, the Global Notes shall be deemed to be surrendered to the Paying Agent for cancellation, and the Company shall execute, and the Authentication Agent shall authenticate and deliver, to each beneficial owner identified by the Depositary in writing in exchange for its beneficial interest in the Global Notes, an equal aggregate principal amount of Physical Notes of authorized denominations.

(g)    Any beneficial interest in one of the Global Notes that is transferred to a Person who takes delivery in the form of an interest in another Global Note shall, upon transfer,

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cease to be an interest in such Global Note and become an interest in such other Global Note and, accordingly, shall thereafter be subject to all transfer restrictions and other procedures applicable to beneficial interests in such other Global Note for as long as it remains such an interest.

(h)    The Holder of any Global Note may grant proxies and otherwise authorize any Person, including Agent Members and Persons that may hold interests through Agent Members, to take any action which a Holder is entitled to take under this Indenture or the Notes.

SECTION 2.17.    Computation of Interest.

Interest on the Notes of a series shall be computed in accordance with the terms of the Notes of such series.

ARTICLE III Redemption and Prepayment

SECTION 3.01.    Election To Redeem; Notices to Trustee.

Notes of any series that are redeemable before their Stated Maturity shall be redeemable in accordance with their respective terms and (except as otherwise specified as contemplated by Section 2.01 for Notes of any series) in accordance with this Article III.  Any redemption may, at the Company’s discretion, be subject to the satisfaction of one or more conditions precedent.

If the Company elects to redeem any Notes pursuant to this Article III, at least 10 days prior to the Redemption Date (unless a shorter period is acceptable to the Trustee and the Paying Agent) but not more than 60 days prior to the Redemption Date (unless a longer period is acceptable to the Trustee and the Paying Agent), the Company shall notify the Trustee and the Paying Agent in writing of the series of Notes to be redeemed, the Redemption Date and the principal amount of such Notes to be redeemed and the Redemption Price, and deliver to the Trustee and the Paying Agent, no later than two Business Days prior to the Redemption Date (unless a shorter period is acceptable to the Trustee and the Paying Agent), an Officer’s Certificate stating that such redemption will comply with the conditions contained this Article III.  Any such notice may be canceled at any time prior to the mailing of such notice of such redemption to any Holder and shall thereupon be void and of no effect.  The notice shall reflect the conditions to the redemption and shall be specified by the Company.

SECTION 3.02.    Selection of Notes To Be Redeemed.

If the Company elects to redeem less than all of the Notes of any series at any time, in the case of Notes issued in definitive form, the Notes to be redeemed shall be selected in accordance with applicable procedures of the Depositary.

SECTION 3.03.    Notice of Redemption.

Notice of any optional redemption shall be given in accordance with Section 10.01 hereto at least 10 days but not more than 60 days before the Redemption Date to each holder of the Notes to be redeemed.  The Company may provide in the notice that payment of the

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Redemption Price and performance of the Company’s obligations with respect to the redemption or purchase may be performed by another Person.

The notice shall identify the Notes to be redeemed (including the series and the CUSIP and/or ISIN numbers thereof) and shall state:

(a)    the Redemption Date;

(b)    the Redemption Price;

(c)    any conditions to the redemption as specified by the Company;

(d)    if fewer than all outstanding Notes of a series are to be redeemed, the portion of the principal amount of such Note to be redeemed and that, after the Redemption Date and upon surrender of such Note, a new Note or Notes in principal amount equal to the unredeemed portion will be issued;

(e)    the name and address of the Paying Agent;

(f)    that Notes called for redemption must be surrendered to the Paying Agent to collect the Redemption Price;

(g)    that unless the Company defaults in making the redemption payment, interest on Notes called for redemption ceases to accrue on and after the Redemption Date;

(h)    the aggregate principal amount of Notes of such series that are being redeemed;

(i)    the paragraph of the Notes and/or Section of this Indenture pursuant to which the Notes called for redemption are being redeemed; and

(j)    that no representation is made as to the correctness or accuracy of the CUSIP and/or ISIN number, if any, listed in such notice or printed on the Notes.

At the Company’s written request made at least five Business Days prior to the date on which notice is to be given (unless a shorter period is acceptable to the Paying Agent), the Paying Agent shall give the notice of redemption to the Holders in the Company’s name and at the Company’s sole expense.

SECTION 3.04.    Effect of Notice of Redemption.

Once the notice of redemption described in Section 3.03 is sent (or delivered as required by the Depositary), Notes called for redemption shall, subject to the satisfaction of any applicable conditions, become irrevocably due and payable on the Redemption Date and at the Redemption Price, including any premium, plus interest accrued and unpaid to, but excluding, the Redemption Date.  Upon surrender to the Paying Agent, such Notes shall be paid at the Redemption Price, including any premium, plus interest accrued and unpaid to, but excluding, the Redemption Date; provided that (i) if the Redemption Date is after a record date and on or

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prior to the related Interest Payment Date, the accrued and unpaid interest shall be payable to the Holder of the redeemed Notes registered on the relevant record date; and (ii) if a Redemption Date is not a Business Day, payment shall be made on the next succeeding Business Day and no interest shall accrue for the period from such Redemption Date to such succeeding Business Day.  Such notice, if sent (or delivered as required by the Depositary) in the manner provided in Section 3.03, shall be conclusively presumed to have been given whether or not the Holder receives such notice.

SECTION 3.05.    Deposit of Redemption Price.

With respect to the Notes of a series denominated in Dollars, prior to 11:00 A.M., New York time, and, with respect to the Notes of a series denominated in any Non-Dollar Currency, prior to 11:00 A.M., London time, or as advised by the Paying Agent in relation to any Non-Dollar Currency other than euro and pounds sterling, on each Redemption Date, subject to the satisfaction of any applicable conditions, the Company shall deposit with the applicable Paying Agent in immediately available funds money sufficient to pay the Redemption Price of, including premium, if any, and accrued and unpaid interest on all Notes to be redeemed on that date other than Notes or portions thereof called for redemption on that date which have been delivered by the Company to the applicable Paying Agent for cancellation.

On and after any Redemption Date, if money sufficient to pay the Redemption Price of, including premium, if any, and accrued and unpaid interest on Notes called for redemption shall have been made available in accordance with the immediately preceding paragraph, the Notes called for redemption will cease to accrue interest and the only right of the Holders of such Notes will be to receive payment of the Redemption Price of, including premium, if any, and, subject to Section 3.04, accrued and unpaid interest on such Notes to, but excluding, the Redemption Date.  If any Note surrendered for redemption shall not be so paid, interest will be paid, from the Redemption Date until such redemption payment is made, on the unpaid principal of the Note and any interest not paid on such unpaid principal, in each case at the rate and in the manner provided in the Notes.

SECTION 3.06.    Notes Redeemed in Part.

If any Note is to be redeemed in part only, the notice of redemption that relates to that Note will state the portion of the principal amount thereof that is to be redeemed.  The Company will issue and execute, and the Authentication Agent will authenticate, a new Note of the applicable series in a principal amount equal to the unredeemed portion of the original Note in the name of the Holder upon cancellation of the original Note.  Notes called for redemption become due on the Redemption Date.  On and after such date, unless the Company defaults in payment of the Redemption Price on such date, interest ceases to accrue on the Notes or portions thereof called for such redemption.

SECTION 3.07.    Tax Redemption.

Each series of Notes is also redeemable by the Company, in whole but not in part, at 100% of the principal amount of such Notes plus any accrued and unpaid interest (including any Additional Amounts) to the applicable Redemption Date at the Company’s option at any

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time prior to their maturity if, due to a Change in Tax Law (as defined below): (i) the Company or any Guarantor, in accordance with the terms of the applicable Notes or applicable Guarantee, has, or would, become obligated to pay any Additional Amounts to the Holders of the Notes of that series; (ii) in the case of any Guarantor, (A) the Parent would be unable, for reasons outside its control, to procure payment by the Company or any other Guarantor or (B) the procuring of such payment by the Company and each such other Guarantor would be subject to withholding Taxes imposed by a Relevant Taxing Jurisdiction; and (iii) such obligation cannot otherwise be avoided by such Guarantor, the Parent or the Company, taking reasonable measures available to it.  In such case, the Company may redeem the applicable Notes upon not less than 30 nor more than 60 days’ notice as provided in Section 3.03, at 100% of the principal amount of such Notes plus accrued and unpaid interest to the Redemption Date (including Additional Amounts); provided that (i) no such notice of redemption shall be given earlier than 90 days prior to the earliest date on which the Company or such Guarantor, as the case may be, would be obligated to pay any such Additional Amounts in respect of the applicable Notes or applicable Guarantee, as applicable, then due; and (ii) at the time such notice is given, such obligation to pay such Additional Amounts remains in effect.  The Company’s right to redeem the applicable Notes shall continue as long as the Company or any Guarantor is obligated to pay such Additional Amounts, notwithstanding that the Company or such Guarantor, as the case may be, shall have made payments of Additional Amounts.  Prior to the giving of any such notice of redemption, the Company must deliver to the Trustee: (i) an Officer’s Certificate stating that the Company is entitled to effect such redemption and setting forth a statement of facts showing that the conditions precedent to the right of the Company to so redeem have occurred; and (ii) an opinion of independent counsel or an independent accountant of recognized standing, selected by the Company or any Guarantor, as applicable, with respect to tax matters of the Relevant Taxing Jurisdiction to the effect that the Company or such Guarantor has, or would, become obligated to pay such Additional Amounts as a result of such Change in Tax Law.

For the purposes hereof, “Change in Tax Law” shall mean: (i) any changes in, or amendment to, any law of a Relevant Taxing Jurisdiction (including any regulations or rulings promulgated thereunder and including, for this purpose, any treaty entered into by the Relevant Taxing Jurisdiction) or any amendment to or change in the application or official interpretation (including judicial or administrative interpretation) of such law, which change or amendment becomes effective or, in the case of an official interpretation, is announced, on or after the first date of issuance of Notes of such series pursuant to Section 2.01; or (ii) if the Company or any Guarantor consolidates, merges, amalgamates or combines with, or transfers or leases its assets substantially as an entirety to, any person that is incorporated or tax resident under the laws of any jurisdiction other than a Relevant Taxing Jurisdiction (a “successor”) and as a consequence thereof such person becomes the successor obligor to the Company or such Guarantor in respect of Additional Amounts that may become payable (in which case, for purposes of this redemption provision, all references to the Company or such Guarantor shall be deemed to be and include references to such person), any change in, or amendment to, any law of the jurisdiction of organization or tax residence of such successor, or the jurisdiction through which payments will be made by the successor, or any political subdivision or taxing authority thereof or thereon for purposes of taxation (including any regulations or rulings promulgated thereunder and including, for this purpose, any treaty entered into by such jurisdiction) or any amendment to or change in the application or official interpretation (including judicial or administrative interpretation) of such law, which change or amendment becomes effective or, in the case of an official

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interpretation, is announced, on or after the date of such consolidation, merger, amalgamation, combination or other transaction.

ARTICLE IV Covenants

SECTION 4.01.    Payment of Principal, Premium and Interest.

The Company covenants and agrees that it will duly and punctually pay the principal of (and premium, if any) and interest on the Notes of each series in accordance with the terms of the Notes of such series and this Indenture.

SECTION 4.02.    Maintenance of Office or Agency.

The Company will maintain in each Place of Payment for Notes an office or agency where Notes may be presented or surrendered for payment, where Notes may be presented for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Notes and this Indenture may be served.  The Company will give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency.  If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands (except for service of process in relation to any proceeding arising out of or relating to the performance of the Company’s obligations under this Indenture and the Notes) may be made or served at the Corporate Trust Office of the Trustee/Paying Agent, and the Company hereby appoints the Trustee as its agent to receive all such presentations, surrenders, notices and demands, provided that, with respect to any series of Notes issued in Non-Dollar currency, any presentations, surrenders, notices and demands (except for service of process in relation to any proceeding arising out of or relating to the performance of the Company’s obligations under this Indenture and the Notes) may be made or served at the Corporate Trust Office of the Paying Agent for such series of Notes, and the Company hereby appoints the Paying Agent for such series of Notes as its agent to receive any presentations, surrenders, notices and demands for such Notes.

The Company may also from time to time designate one or more other offices or agencies where the Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in each Place of Payment for Notes for such purposes.  The Company will give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.

SECTION 4.03.    Reports by the Company.

(a)    If the Company or any Guarantor is subject to TIA § 314(a), the requirement to deliver to the Trustee and the Holders the annual reports and information, documents, and other reports which the Company or any Guarantor is required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act will be satisfied if the Company or any Guarantor files such reports, information and documents electronically using

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the Commission’s EDGAR electronic filing system or any successor system, and such reports, information and documents are publicly available on the Commission’s web site.

(b)    Notwithstanding anything herein to the contrary, in the event that the Company fails to comply with its obligation to file or provide such information, documents and reports as required hereunder, the Company will be deemed to have cured such Default for purposes of Section 5.01(b) upon the filing or provision of all such information, documents and reports required hereunder prior to the expiration of 120 days after written notice to the Company of such failure from the Trustee or from the Holders of at least 25% of the principal amount of the applicable series of Notes (with a copy to the Trustee).

(c)    Notwithstanding anything herein to the contrary, the information, documents and reports required pursuant to this Indenture may, at the option of the Company, instead be those of any direct or indirect parent entity of the Company so long as such parent entity has fully and unconditional guaranteed by execution of this Indenture in the case of the Parent, or fully and unconditionally guarantees, by execution of a supplemental indenture, the obligations of the Company in respect of the Notes and such parent entity and the Company comply with the requirements of Rule 3-10 of Regulation S-X promulgated by the Commission (or any successor provision).

(d)    Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officer’s Certificates).

SECTION 4.04.    Corporate Existence.

Subject to Section 4.10, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its existence as a corporation.

SECTION 4.05.    Money for Notes Payments.

If the Company shall at any time act as its own Paying Agent with respect to a series of Notes, it will, on or before each due date of the principal of (and premium, if any) or interest on any of the Notes of such series, segregate and hold in trust for the benefit of the Persons entitled thereto a sum sufficient to pay the principal (and premium, if any) or interest so becoming due until such sums shall be paid to such Persons or otherwise disposed of as herein provided and will promptly notify the Trustee of its action or failure so to act.

Whenever the Company shall have a Paying Agent for a series of Notes, it will, with respect to the Notes of a series denominated in Dollars, prior to 11:00 A.M., New York time, and, with respect to the Notes of a series denominated in any Non-Dollar Currency, prior to 11:00 A.M., London time, or as advised by the Paying Agent in relation to any Non-Dollar Currency other than euro and pounds sterling, on each due date of the principal of (and premium, if any) or interest on the Notes of such series, deposit with the applicable Paying Agent a sum sufficient to pay the principal (and premium, if any) or interest so becoming due, such sum to be held in trust for the benefit of the Persons entitled to such principal, premium or interest, and

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(unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its action or failure so to act.

If the Paying Agent is not a party to this Indenture, the Company will cause the Paying Agent, other than the Trustee, to execute and deliver to the Trustee an instrument in which the Paying Agent shall agree with the Trustee, subject to the provisions of this Section 4.05, that the Paying Agent will:

(a)    hold in trust all sums held by it for the payment of the principal of (and premium, if any) or interest on the Notes of a series for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided;

(b)    give the Trustee notice of any default by the Company (or any other obligor upon the Notes) in the making of any payment of principal (and premium, if any) or interest on the Notes of a series; and

(c)    at any time during the continuance of any such default, upon the written request of the Trustee, forthwith pay to the Trustee all sums so held by the Paying Agent.

The Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or by Company Order direct the Paying Agent to pay, to the Trustee all sums held by the Paying Agent or held in trust by the Company, such sums to be held in trust by the Trustee; and, upon such payment by the Paying Agent to the Trustee, the Paying Agent shall be released from all further liability with respect to such money.

SECTION 4.06.    Payment of Taxes and Other Claims.

The Company will pay or discharge or cause to be paid or discharged, before the same shall become delinquent, (i) all material taxes, assessments and governmental charges levied or imposed upon the Company or upon the income, profits or property of the Company, and (ii) all material lawful claims against the Company for labor, materials and supplies, which in the case of either clause (i) or (ii) of this Section 4.06, if unpaid, might by law become a lien upon a property; provided, however, that the Company shall not be required to pay or discharge or cause to be paid or discharged any such tax, assessment, charge or claim whose amount, applicability or validity is being contested in good faith by appropriate proceedings.

SECTION 4.07.    Stay, Extension and Usury Laws.

The Company and each Guarantor covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of this Indenture; and the Company and each Guarantor (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it will not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law has been enacted.

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SECTION 4.08.    Payment of Additional Amounts.

Unless either inapplicable to a particular series or specifically deleted or modified in or pursuant to the Officer’s Certificate or any supplemental indenture establishing such series of Notes or in the form of note for such series, each of the Parent, BATIF and BATNF will make payments pursuant to the applicable Guarantee without withholding or deduction for or on account of any present or future tax, levy, impost or other similar governmental charge (“Taxes”) imposed, assessed, levied or collected by or for the account of the United Kingdom (in the case of a payment by the Parent or BATIF) or The Netherlands (in the case of a payment by BATNF), including in each case any political subdivision thereof or any authority thereof having the power to tax (a “Relevant Taxing Jurisdiction”), unless such withholding or deduction is required by law.

If any such Guarantor is required by a Relevant Taxing Jurisdiction to so withhold or deduct such Taxes, such Guarantor will pay to the Holder such additional amounts (“Additional Amounts”) as will result in the receipt by the Holder of such amounts as would have been received by it if no such withholding or deduction of Taxes had been required; provided, however, that no Guarantor shall be required to pay any Additional Amounts for or on account of:

(a)    any Taxes that would not have been so imposed, assessed, levied or collected but for the Holder or beneficial owner of the applicable Note or Guarantee (or a fiduciary, settlor, beneficiary, member or shareholder of, or possessor of a power over, such Holder, if such Holder is an estate, trust, partnership or corporation) being or having been a domiciliary, national or resident of, or engaging or having been engaged in a trade or business, maintaining or having maintained a permanent establishment or being or having been physically present in, a Relevant Taxing Jurisdiction or otherwise having or having had some connection with a Relevant Taxing Jurisdiction other than the holding or ownership of, or the collection of principal of, and premium (if any) or interest on, a Note or the enforcement of the applicable Note or Guarantee, as the case may be;

(b)    any Taxes that would not have been so imposed, assessed, levied or collected but for the fact that, where presentation is required in order to receive payment, the applicable Note or Guarantee was presented more than 30 days after the date on which such payment became due and payable or was provided for, whichever is later, except to the extent that the Holder or beneficial owner thereof would have been entitled to Additional Amounts had the applicable Note or Guarantee been presented for payment on any day during such 30-day period;

(c)    any estate, inheritance, gift, sales, transfer, personal property or similar Taxes;

(d)    any Taxes that are payable otherwise than by withholding or deduction from payments on or in respect of the applicable Note or Guarantee;

(e)    any Taxes that would not have been so imposed, assessed, levied or collected but for the failure by the Holder or the beneficial owner of the applicable Note or

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Guarantee to (i) provide any certification, identification, information, documents or other evidence concerning the nationality, residence or identity of the Holder or the beneficial owner or its connection with a Relevant Taxing Jurisdiction; or (ii) make any valid or timely declaration or claim or satisfy any other reporting, information or procedural requirements relating to such matters if, in either case, compliance is required by statute, regulation, relevant income tax treaty or administrative practice of a Relevant Taxing Jurisdiction as a condition to relief or exemption from such Taxes;

(f)    any Taxes imposed or withheld pursuant to Sections 1471 through 1474 of the Code (or any amended or successor provisions), any U.S. Treasury regulations promulgated thereunder, any official interpretations thereof or any agreements entered into in connection with the implementation thereof (“FATCA Withholding”); or

(g)    any combination of the Taxes described in clauses (a) through (f) above.

In addition, Additional Amounts will not be paid with respect to any payment of the principal of, or premium (if any) or interest on, any Note or any payment pursuant to the applicable Guarantee to any Holder that is a fiduciary, a partnership, a limited liability company or any person other than the sole beneficial owner of such payment to the extent a beneficiary or settlor with respect to such fiduciary, a member of such partnership, an interest holder in such limited liability company or a beneficial owner that would not have been entitled to such amounts had such beneficiary, settlor, member, interest holder or beneficial owner been the Holder of the applicable Note or Guarantee.

Unless otherwise stated, references in any context to the payment of principal of, and premium (if any) or interest on, any Note or any payment pursuant to a Guarantee will be deemed to include payment of Additional Amounts to the extent that, in such context, Additional Amounts are, were or would be payable in respect thereof.

SECTION 4.09.    Negative Pledge.

So long as any of the Notes remain outstanding, neither the Company nor any Guarantor will secure or allow to be secured any Quoted Borrowing issued by the Company or any Guarantor or any payment under any guarantee by any of them of any such Quoted Borrowing by any mortgage, charge, pledge or lien (other than arising by operation of law) upon any of its undertaking or assets, whether present or future, unless at the same time the same mortgage, charge, pledge or lien is extended, or security which is not materially less beneficial to the Holders of the Notes than the security given as aforesaid or which shall be approved by consent of the Holders of not less than 75% in aggregate principal amount of the Notes at the time outstanding is extended or created (as the case may be), to secure equally and ratably the principal of, and interest on, and all other payments (if any) in respect of the Notes.

SECTION 4.10.    Limitation on Mergers, Consolidations, Amalgamations and Combinations.

So long as any of the Notes remain outstanding, neither the Company nor any Guarantor may consolidate with or merge into any other person or sell, convey, transfer or lease its properties and assets as an entirety or substantially as an entirety to any person (other than any

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sale or conveyance by way of a lease in the ordinary course of business), unless: (i) in the case of the Company, any successor person assumes the Company’s obligations on the Notes and under this Indenture and, in the case of any Guarantor, any successor person assumes such Guarantor’s obligations on the Guarantee and under this Indenture; (ii) immediately after giving effect to such transaction, no Event of Default, and no event which, after notice or lapse of time or both, would become an Event of Default, shall have occurred and be continuing; (iii) such successor person is organized under the laws of the United States or any State thereof, the United Kingdom, The Netherlands or any other country that is a member of the Organization for Economic Cooperation and Development as of the date of such succession; (iv) such successor person agrees to pay any Additional Amounts with respect to any withholding or deduction of Taxes or any payment on the Notes or Guarantees (as applicable) imposed by the jurisdiction (other than the United States, unless otherwise required by clause (i) of this Section 4.10) in which such successor person is incorporated or otherwise a resident for tax purposes in accordance with Section 4.08 (for the avoidance of doubt, solely to the extent such successor person is the Issuer, changes will be made to this Indenture as are necessary to obligate the Issuer to pay such Additional Amounts); and (v) if as a result of such consolidation or merger or such sale, conveyance, transfer or lease, properties or assets of the Company or any Guarantor would become subject to a mortgage, pledge, security interest, lien or similar encumbrance to secure payment of any indebtedness for borrowed money of the Company or any Guarantor which would not be permitted by the applicable Notes of such series or under this Indenture, the Company or any Guarantor or such successor person, as the case may be, shall take such steps as shall be necessary to effectively secure the Notes of such series equally and ratably with (or prior to) all indebtedness for borrowed money secured thereby.

Upon any consolidation of the Company or any Guarantor with, or merger of the Company or any Guarantor into, any other Person or any sale, conveyance, transfer or lease of all or substantially all of the assets of the Company or any Guarantor in accordance with this Section 4.10, the successor Person formed by such consolidation or into which the Company or any Guarantor is merged or to which such sale, conveyance, transfer or lease is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company or a Guarantor under this Indenture and the Notes with the same effect as if such Person had been named as the Company or a Guarantor herein, as the case may be, and thereafter, except in the case of a lease, the predecessor Person shall be relieved of all obligations and covenants under this Indenture, the Notes and the applicable Guarantee, as the case may be.  The terms “Company” and “Guarantor”, as used in the Notes and the Indenture, also refer to any such successors or assigns so substituted.

The limitation on mergers, consolidations, amalgamations and combinations contained in this Section 4.10 shall not apply to any consolidation, merger, amalgamation or combination in which the Company or any Guarantor is the surviving corporation except that, in such case, the provisions of clauses (ii) and (v) of the first paragraph of this Section 4.10 shall apply such that: (x) immediately after giving effect to such transaction, no Event of Default, and no event which, after notice or lapse of time or both, would become an Event of Default, shall have occurred and be continuing; and (y) if as a result of such consolidation or merger or such sale, conveyance, transfer or lease, properties or assets of the Company or any Guarantor would become subject to a mortgage, pledge, security interest, lien or similar encumbrance to secure payment of any indebtedness for borrowed money of the Company or any Guarantor which

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would not be permitted by the Notes or under this Indenture, the Company or any Guarantor, as the case may be, shall take such steps as shall be necessary to effectively secure the Notes equally and ratably with (or prior to) all indebtedness for borrowed money secured thereby.

SECTION 4.11.    Statement by Officers as to Event of Default.

The Company shall, so long as any of the Notes is outstanding, deliver to a Responsible Officer of the Trustee, forthwith (and in any event within 10 Business Days) upon any Officer of the Company becoming aware of any Event of Default, an Officer’s Certificate specifying such Event of Default, its status and what action the Company is taking or proposes to take in respect thereof.

SECTION 4.12.    Statements as to Compliance.

The Company will deliver to the Trustee, within 180 days after the end of each fiscal year of the Parent, a written statement signed by the principal executive officer, principal financial officer or principal accounting officer of the Parent (complying with Section 314(a)(4) of the TIA), stating that:

(a)    a review of the activities of the Company and the Guarantors during such year and of performance under this Indenture has been made under his or her supervision; and

(b)    to the best of his or her knowledge, based on such review, the Company and the Guarantors are in compliance with all conditions and covenants under this Indenture.

For purposes of this Section 4.12, such compliance shall be determined without regard to any period of grace or requirement of notice provided under this Indenture.

SECTION 4.13.    Mutual Undertaking Regarding Information Reporting and Collection Obligations.

Each party (other than the Trustee) shall, within 10 Business Days of a written request by another party, supply to that other party such forms, documentation and other information relating to such party, its operations or the Notes as that other party reasonably requests for the purposes of that other party’s compliance with Applicable Law and shall notify the relevant other party reasonably promptly in the event that such party becomes aware that any of the forms, documentation or other information provided by such party is (or becomes) inaccurate in any material respect; provided, however, that no party shall be required to provide any forms, documentation or other information pursuant to this Section 4.13 to the extent that: (i) any such form, documentation or other information (or the information required to be provided on such form or documentation) is not reasonably available to such party and cannot be obtained by such party using reasonable efforts; or (ii) doing so would or might in the reasonable opinion of such party constitute a breach of any: (A) Applicable Law; (B) fiduciary duty; or (C) duty of confidentiality.  For purposes of this Section 4.13, “Applicable Law” shall be deemed to include (i) any relevant rule or practice of any Authority by which any party is bound or with which it is accustomed to comply; (ii) any relevant agreement between any Authorities; and (iii) any relevant agreement between any Authority and any party that is customarily entered into by institutions of a similar nature.

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SECTION 4.14.    Agent Right to Withhold.

Notwithstanding any other provision of this Indenture, each Agent shall be entitled to make a deduction or withholding from any payment which it makes under the Notes for or on account of any Taxes, if and only to the extent so required by Applicable Law, in which event each such Agent shall make such payment after such deduction or withholding has been made and shall account to the relevant Authority within the time allowed for the amount so deducted or withheld or, at its option in the case of any Tax other than a U.S. federal withholding Tax, shall reasonably promptly after making such payment return to the Company the amount so deducted or withheld, in which case, the Company shall so account to the relevant Authority for such amount.  For the avoidance of doubt, FATCA Withholding is a deduction or withholding which is deemed to be required by Applicable Law for the purposes of this Section 4.14.

SECTION 4.15.    Company Right to Redirect.

In the event that the Company determines in its sole discretion that any deduction or withholding for or on account of any Tax will be required by Applicable Law in connection with any payment due to any of the Agents on any Notes, then the Company will be entitled to redirect or reorganize any such payment in any way that it sees fit in order that the payment may be made without such deduction or withholding; provided that any such redirected or reorganized payment is made through a recognized institution of international standing and otherwise made in accordance with this Indenture.  The Company will promptly notify the Agents and the Trustee in writing of any such redirection or reorganization.  For the avoidance of doubt, FATCA Withholding is a deduction or withholding which is deemed to be required by Applicable Law for the purposes of this Section 4.15.

ARTICLE V Defaults and Remedies

SECTION 5.01.    Events of Default.

Unless either inapplicable to a particular series or specifically deleted or modified in or pursuant to the Officer’s Certificate or any supplemental indenture establishing such series of Notes or in the form of note for such series, each of the following events shall be an “Event of Default” with respect to any series of Notes:

(a)    default is made in the payment of: (i) any installment of interest (excluding Additional Amounts) upon any Note of the relevant series as and when the same shall become due and payable, and there is a continuance of such default for a period of 14 days or more; (ii) applicable Additional Amounts as and when the same shall become due and payable, and there is a continuance of such default for a period of 14 days; or (iii) all or any part of the principal or premium, if any, of any Note of the relevant series as and when the same shall become due and payable either at maturity, upon any redemption, by declaration or otherwise, and there is a continuance of such default for a period of three days;

(b)    the Company or any Guarantor does not perform or comply with any one or more of its other obligations under the Notes of the relevant series or this Indenture (other than those described in paragraph (a) above) which is not remedied within 30 days (unless a longer period is specified in this Indenture) after written notice of such default shall have been

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given to the Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% of the outstanding principal amount of the Notes;

(c)    (i) any other present or future indebtedness for borrowed money of the Company or any Guarantor, other than the Notes issued by the Company, becomes due and payable prior to its Stated Maturity by reason of any default or event of default in respect thereof by the Company or any Guarantor and remains unpaid; (ii) any such indebtedness for borrowed money is not paid when due or, as the case may be, within any applicable grace period; or (iii) the Company or any Guarantor fails to pay when due and called upon (after the expiry of any applicable grace period) any amount payable by it under any present or future guarantee for, or indemnity in respect of, any indebtedness for borrowed money and which remains unpaid; provided that (x) payment of the indebtedness for borrowed money is not being contested in good faith and in accordance with legal advice or (y) the aggregate amount of the indebtedness for borrowed money, guarantees and indemnities in respect of which one or more of the events mentioned above in clauses (i), (ii) and (iii) of this paragraph (c) has or have occurred and is or are continuing, equals or exceeds £750 million or its equivalent in any other currency of the indebtedness for borrowed money or, if greater, 1.25% of the Total Equity of the Parent, as set out in the “Total Equity” line item in the most recent consolidated group balance sheet of the Parent and its subsidiaries in the Parent’s most recent annual report;

(d)    any Guarantee ceases to be in full force and effect (except as contemplated by the terms of this Indenture) or any Guarantor denies or disaffirms in writing its obligations under this Indenture or Guarantee;

(e)    a distress or execution or other legal process is levied or enforced against or an encumbrancer takes possession of or a receiver, administrative receiver or other similar officer is appointed of the whole or a part of the assets of the Company or any Guarantor which is substantial in relation to the BAT Group taken as a whole and is not discharged, stayed, removed or paid out within 45 days after such execution or appointment;

(f)    any mortgage, charge, pledge, lien or other encumbrance, present or future, created or assumed by the Company or any Guarantor becomes enforceable against all or substantially all of the assets of the Company or any Guarantor, and any step is taken to enforce it (including the taking of possession or the appointment of a receiver, administrative receiver, manager or other similar person) and is not discharged within 45 days;

(g)    the Company or any Guarantor is insolvent or bankrupt or unable to pay its debts (in respect of companies incorporated in England and Wales, within the meaning of Section 123(1)(b) or (e) or Section 123(2) of the UK Insolvency Act 1986), stops, suspends or threatens to stop or suspend payment of all or a material part of its debts, proposes or makes a general assignment or an arrangement or composition (otherwise than for the purposes of reconstruction, amalgamation, reorganization, merger or consolidation or other similar arrangement) with or for the benefit of its creditors in respect of any of such debts or a moratorium is agreed or declared in respect of or affecting all or a material part of the debts of the Company;

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(h)    an order is made or an effective resolution passed for the winding-up or dissolution or administration of the Company or any Guarantor, or the Company or any Guarantor shall apply or petition for a winding-up or administration order in respect of itself or ceases or threatens to cease to carry on all or substantially all of its business or operations, in each case except for the purpose of and followed by a reconstruction, amalgamation, reorganization, merger or consolidation or other similar arrangement; or

(i)    any event occurs that under the laws of any relevant jurisdiction has an analogous effect to any of the events referred to in any of the foregoing paragraphs (g) and (h).

An Event of Default with respect to any series of Notes would not necessarily constitute an Event of Default with respect to the other series of Notes.

Notwithstanding the foregoing provisions of this Section 5.01, if the principal of, premium (if any) or interest on or Additional Amounts with respect to any Note is payable in a currency or currencies other than Dollars and such currency or currencies are not available to the Company or any Guarantor for making payment thereof due to the imposition of exchange controls or other circumstances beyond the control of the Company or such Guarantor (a “Conversion Event”), the Company and the Guarantor will be entitled to satisfy its obligations to Holders of the Notes by making such payment in Dollars in an amount equal to the Dollar equivalent of the amount payable in such other currency, as determined by the Company or the Guarantor making such payment, as the case may be, based on the Exchange Rate on the date of such payment, or, if such rate is not then available, on the basis of the most recently available Exchange Rate.  Notwithstanding the foregoing provisions of this Section 5.01, any payment made under such circumstances in Dollars where the required payment is in a currency other than Dollars will not constitute an Event of Default under this Indenture.

Promptly after the occurrence of a Conversion Event, the Company or the relevant Guarantor shall give written notice thereof to the Trustee and to the Paying Agent; and the Trustee, promptly after receipt of such notice, shall give notice thereof in the manner provided in Section 10.01 to the Holders of the relevant series of Notes.  Promptly after the making of any payment in Dollars as a result of a Conversion Event, the Company or the Guarantor making such payment, as the case may be, shall give notice in the manner provided in Section 10.01 to the Holders, setting forth the applicable Exchange Rate and describing the calculation of such payments.

SECTION 5.02.    Acceleration of Maturity; Rescission.

If an Event of Default with respect to the Notes of a series then outstanding occurs and is continuing, then and in each and every such case (other than Events of Default specified in Section 5.01(g), (h) or (i) with respect to the Company or any Guarantor), unless the principal of all the Notes of such series shall have already become due and payable, the Holders of not less than 25% in aggregate principal amount of the Notes of such affected series then outstanding, by notice in writing to the Company, each Guarantor and the Trustee, may declare the entire principal amount of all Notes of such series and interest accrued and unpaid thereon, if any, to be due and payable immediately, and upon any such declaration the same shall become

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immediately due and payable, without any further declaration or other act on the part of any Holder.

If the Events of Default specified in Section 5.01(g), (h) or (i) occur with respect to the Company or any Guarantor and are continuing with respect to a series of Notes, the principal amount of and accrued and unpaid interest on all the Notes of such series issued pursuant to this Indenture shall become immediately due and payable, without any declaration or other act on the part of the Trustee or any Holder.

The registered Holders of a majority in aggregate principal amount of the then outstanding Notes of such series may rescind and annul such acceleration and its consequences (i) if the rescission would not conflict with any judgment or decree and (ii) if all existing Events of Default have been cured or waived except nonpayment of principal, that has become due solely because of the acceleration, by written notice to the Company, each Guarantor and the Trustee.  However, no such rescission and annulment shall extend to or shall affect any subsequent Default or shall impart any right consequent thereon.

Subject to Section 6.01, in case an Event of Default shall occur and be continuing, the Trustee shall be under no obligation to exercise any of its rights or powers under this Indenture at the request or direction of any of the Holders of Notes of any series, unless such Holders have offered to the Trustee security or indemnity satisfactory to it.  Subject to Section 6.06, the Holders of a majority in aggregate principal amount of any series of Notes then outstanding will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power the Trustee holds with respect to the Notes of such series.

For all purposes under this Indenture, if a portion of the principal of any Original Issue Discount Notes shall have been accelerated and declared due and payable pursuant to the provisions hereof, then, from and after such declaration, unless such declaration has been rescinded and annulled, the principal amount of such Original Issue Discount Notes shall be deemed, for all purposes hereunder, to be such portion of the principal thereof as shall be due and payable as a result of such acceleration, and payment of such portion of the principal thereof as shall be due and payable as a result of such acceleration, together with interest, if any, thereon and all other amounts owing thereunder, shall constitute payment in full of such Original Issue Discount Notes.

SECTION 5.03.    Other Remedies.

If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy by proceeding at law or in equity to collect the payment of principal of, or premium, if any, and interest on the Notes of each applicable series or to enforce the performance of any provision of the Notes of each applicable series or this Indenture and may take any necessary action requested of it as Trustee to settle, compromise, adjust or otherwise conclude any proceedings to which it is a party.

The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding.  Any such proceeding instituted by the

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Trustee may be brought in its own name and as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the compensation and reasonable expenses, disbursements of the Trustee and its counsel, be for the ratable benefit of the Holders of the Notes in respect of which such judgment has been recovered.  A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default.  No remedy is exclusive of any other remedy.  All available remedies are cumulative, to the extent permitted by law.  Any reasonable costs associated with actions taken by the Trustee in good faith and without negligence under this Section 5.03 shall be reimbursed to the Trustee by the Company.

SECTION 5.04.    Waiver of Past Defaults and Events of Default.

Provided the Notes are not then due and payable by reason of a declaration of acceleration, the Holders of a majority in principal amount of the then outstanding Notes of such series may on behalf of the Holders of all the affected Notes of such series waive any past Default with respect to such series of Notes and its consequences by providing written notice thereof to the Company and the Trustee, except a Default (1) in the payment of interest on or the principal of any Note or (2) in respect of a covenant or provision hereof which under this Indenture cannot be modified or amended without the consent of the Holder of each outstanding Note affected.  In the case of any such waiver, the Company, the Trustee and the Holders of the Notes of any applicable series will be restored to their former positions and rights under this Indenture, respectively; provided that no such waiver shall extend to any subsequent or other Default or impair any right consequent thereto.

SECTION 5.05.    Control by Majority.

The Holders of at least a majority in aggregate principal amount of the outstanding Notes of a series may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee with respect to the Notes of such series.  However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture, that may involve the Trustee in personal liability, or that the Trustee determines in good faith may be unduly prejudicial to the rights of Holders of the affected Notes not joining in the giving of such direction and may take any other action it deems proper that is not inconsistent with any such direction received from Holders of the Notes.

SECTION 5.06.    Limitation on Suits.

No Holder of the Notes of a series will have any right to institute any action or proceeding at law or in equity or in bankruptcy or otherwise upon or under or with respect to this Indenture, or for the appointment of a trustee, receiver, liquidator, custodian or other similar official or for any other remedy under this Indenture (except suits for the enforcement of payment of overdue principal or interest) unless (1) the Holder has previously given the Trustee written notice of a continuing Event of Default; (2) the Holders of at least 25% in principal amount of the outstanding Notes of such series have made a written request to the Trustee to institute such proceeding as Trustee; (3) the Holder or Holders of Notes have offered, and if

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requested, have provided to the Trustee indemnity satisfactory to the Trustee against any loss, liability or expense; (4) the Trustee has not complied with the request within 60 days after receipt of the request and the offer of indemnity; and (5) during such 60-day period the Holders of a majority in aggregate principal amount of the outstanding Notes of such series have not given the Trustee a direction inconsistent with the request.

A Holder may not use this Indenture to prejudice the rights of another Holder or to obtain a preference or priority over another Holder (it being understood that the Trustee does not have an affirmative duty to ascertain whether or not such actions or forbearances are unduly prejudicial to such Holders).

However, the Holder of any Note will have an absolute and unconditional right to receive payment of the principal of, and premium, if any, or interest on, such Note on or after the date or dates they are to be paid as expressed in such Note and to institute suit for the enforcement of any such payment.

SECTION 5.07.    Rights of Holders To Receive Payment.

Notwithstanding any other provision of this Indenture, the right of any Holder of a Note to receive payment of the principal of or premium, if any, or interest, if any, on such Note or to bring suit for the enforcement of any such payment, on or after the due date expressed in the Notes shall not be impaired or affected without the consent of such Holder.

SECTION 5.08.    Collection Suit by Trustee.

If an Event of Default in payment of principal, premium or interest specified in Section 5.01(a) occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company (or any other obligor on the Notes) for the whole amount of unpaid principal and accrued interest remaining unpaid.

SECTION 5.09.    Trustee May File Proofs of Claim.

The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the compensation and reasonable expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 6.06) and the Holders allowed in any judicial proceedings relative to the Company (or any other obligor upon the Notes), its creditors or its property and, unless prohibited by law, shall be entitled and empowered to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same after deduction of its charges and expenses to the extent that any such charges and expenses are not paid out of the estate in any such proceedings and any custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee, and in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the compensation and reasonable expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 6.06.

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Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan or reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceedings.  All rights of action and claims under this Indenture or the Notes may be prosecuted and enforced by the Trustee without the possession of any of the Notes thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the compensation and reasonable expenses, disbursements and advances of the Trustee, its agents and counsel, be for the ratable benefit of the Holders in respect of which such judgment has been recovered.

SECTION 5.10.    Priorities.

Any money or property collected by the Trustee pursuant to this Article V, and any money or other property distributable in respect of the Company’s obligations under this Indenture after an Event of Default shall be applied in the following order:

FIRST: to the Trustee (including any predecessor Trustee) for amounts due under Section 6.06;

SECOND: to Holders for amounts due and unpaid on the affected Notes for principal, premium, if any, and interest as to each, ratably, without preference or priority of any kind, according to the amounts due and payable on the affected Notes; and THIRD: to the Company or as otherwise determined by a court of competent jurisdiction.

The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 5.10.

SECTION 5.11.    Undertaking for Costs.

In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant.  This Section 5.11 does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 5.07 or a suit by Holders of more than 10% in principal amount of the Notes of a series then outstanding.

SECTION 5.12.    Delay or Omission Not Waiver.

No delay or omission of the Trustee or of any Holder of any Notes to exercise any right or remedy occurring upon an Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein.  Every right and remedy given by this Article V or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.

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ARTICLE VI Trustee

SECTION 6.01.    Duties of Trustee.

(a)    If an Event of Default actually known to a Responsible Officer of the Trustee has occurred and is continuing, the Trustee will exercise such of the rights and powers vested in it under this Indenture, and use the same degree of care and skill in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs.

(b)    Except during the continuance of an Event of Default:

(i)    the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and

(ii)    in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture but, in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts, statements, opinions or conclusions stated therein).

(c)    No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act, its own bad faith or its own willful misconduct, except that:

(i)    this paragraph does not limit the effect of clause (b) or (d) of this Section 6.01;

(ii)    the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer or Responsible Officers of the Trustee, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and

(iii)    the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction of the Holders of a majority in aggregate principal amount of the outstanding Notes of any series, determined as provided herein, relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture with respect to the Notes of such series.

(d)    No provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for

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believing that repayment of such funds or adequate indemnity satisfactory to it against such risk or liability is not reasonably assured to it.

(e)    Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct of, affecting the liability of, or affording protection to, the Trustee shall be subject to the provisions of this Section 6.01.

(f)    The Trustee shall not be liable for interest or earnings on any money received by it except as the Trustee may agree in writing with the Company.  Money held in trust by the Trustee need not be segregated from other funds except to the extent required by the law.

(g)    The Trustee shall not be responsible for the application of any money by any Paying Agent other than the Trustee.

SECTION 6.02.    Rights of Trustee.

Subject to Section 6.01:

(a)    The Trustee may conclusively rely and shall be fully protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document (whether in its original or facsimile form) believed in good faith by it to be genuine and to have been signed or presented by the proper person.  The Trustee need not investigate any fact or matter stated in the document.

(b)    Any request or direction of the Company mentioned herein shall be sufficiently evidenced by a Company Order and any resolution of the Board of Directors may be sufficiently evidenced by a Board Resolution.

(c)    Whenever in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, conclusively rely upon an Officer’s Certificate.

(d)    The Trustee may execute any of the trusts or power hereunder or perform any duties hereunder either directly or by or through attorneys or agents and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent appointed with due care by it hereunder.

(e)    The Trustee shall not be liable for any action taken, suffered, or omitted to be taken in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture.

(f)    The Trustee may consult with counsel of its selection, and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection from liability in respect of any action taken, omitted or suffered by it hereunder in good faith and in reliance thereon.

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(g)    The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders pursuant to this Indenture, unless such Holders shall have offered to the Trustee security or indemnity satisfactory to the Trustee against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction.

(h)    The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and other Person employed to act hereunder.

(i)    The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further reasonable inquiry or reasonable investigation into such facts or matters as it may see fit.

(j)    The Trustee shall not be deemed to have notice or be charged with knowledge of any Default or Event of Default unless written notice of such Default or Event of Default from the Company or any Holder is received by a Responsible Officer of the Trustee at the Corporate Trust Office of the Trustee/Paying Agent, and such notice references the Notes and this Indenture.

(k)    The Trustee may request that the Company deliver an Officer’s Certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which Officer’s Certificate may be signed by any person authorized to sign an Officer’s Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded.

(l)    Anything contrary in this Indenture notwithstanding, in no event shall the Trustee be liable for special, indirect, punitive or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit), even if the Trustee has been advised as to the likelihood of such loss or damage and regardless of the form of action.

(m)    The Trustee shall not be responsible or liable for any failure or delay in the performance of its obligations under this Indenture arising out of or caused, directly or indirectly, by circumstances beyond its control, including, without limitation, any provision of any law or regulation or any act of any Governmental Authority, acts of God; earthquakes; fire; flood; terrorism; wars and other military disturbances; sabotage; epidemics; riots; interruptions; loss or malfunctions of utilities, computer (hardware or software) or communication services; accidents; labor disputes; acts of civil or military authority and governmental action and may do anything which is, in its reasonable opinion, necessary to comply with any such law, directive or regulation.

(n)    The permissive right of the Trustee to take or refrain from taking action hereunder shall not be construed as a duty.

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(o)    Notwithstanding anything else herein contained, the Trustee and Agents may refrain without liability from doing anything that would or might in its reasonable opinion be contrary to any law of any state or jurisdiction (including but not limited to the United States of America or any jurisdiction forming a part of it and England & Wales) or any directive or regulation of any agency of any such state or jurisdiction and may without liability do anything which is, in its reasonable opinion, necessary to comply with any such law, directive or regulation.  The Trustee and Agents agree to notify the Company, to the extent permitted by applicable law and regulation, of the circumstances which may cause the Trustee or Agents to refrain from acting, as soon as reasonably practicable following such circumstances arising.

SECTION 6.03.    Individual Rights of Trustee.

The Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may make loans to, accept deposits from, perform services for or otherwise deal with the Company or any Affiliate thereof with the same rights it would have if it were not Trustee.  However, in the event that the Trustee acquires any conflicting interest within the meaning of TIA §310(b)(1), it must eliminate such conflict within 90 days or resign; provided, however, that there shall be excluded from the operation of TIA §310(b)(1) any indenture or indentures under which other securities or certificates of interest of participation in other securities of the Company are outstanding if the requirements for such exclusion set forth in TIA §310(b)(1) are met, other than the fact that such indentures are not described herein.

Any Agent may do the same with like rights.  The Trustee is subject to Section 6.09.

SECTION 6.04.    Trustee’s and Agent’s Disclaimers.

The recitals contained herein and in the Notes, except the Authentication Agent’s certificates of authentication, shall be taken as the statements of the Company, and neither the Trustee nor the Authentication Agent assumes responsibility for their correctness.  Neither the Trustee nor the Authentication Agent makes representations as to the validity, sufficiency or adequacy of this Indenture or of the Notes.  Neither the Trustee nor the Authentication Agent shall be accountable for the use or application by the Company of Notes or the proceeds thereof.  The Trustee shall not be responsible to make any calculation with respect to any matter under this Indenture.  The Trustee represents that it is duly authorized to execute and deliver this Indenture and perform its obligations hereunder, as applicable.  Each Agent represents that it is duly authorized to execute and deliver this Indenture, authenticate the Notes and perform its obligations hereunder, as applicable.  Neither the Trustee nor any Agent shall have a duty to monitor or investigate the Company’s compliance with or the breach of, or cause to be performed or observed, any representation, warranty or covenant made in this Indenture.

SECTION 6.05.    Notice of Defaults.

Within 90 days after the occurrence thereof, and if known to the Trustee, the Trustee shall give to the Holders of the Notes of a series notice of each Default or Event of Default with respect to the Notes of such series known to the Trustee, by transmitting such notice to Holders at their addresses as the same shall then appear on the register of the Notes kept by

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the Registrar, unless such Default shall have been cured or waived before the giving of such notice.  Except in the case of a Default or Event of Default in payment of the principal of, premium, if any, or interest on any of the Notes of a series when and as the same shall become payable, or to make any payment as to Notes of a series pursuant to a redemption or repurchase of the Notes pursuant to the provisions of this Indenture, the Trustee shall be protected in withholding such notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of Holders.

SECTION 6.06.    Compensation and Indemnity.

(a)    The Company shall pay to the Trustee and Agents from time to time such compensation for their services hereunder (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust) as shall be agreed upon in writing.  The Company shall reimburse the Trustee and Agents upon written request for all reasonable disbursements, expenses and advances incurred or made by them in connection with the Trustee’s duties under this Indenture, including the compensation and reasonable disbursements and expenses of the Trustee’s agents and external counsel, except any such expense, disbursement or advance as may be attributable to its willful misconduct, bad faith or negligence.

(b)    The Company shall fully indemnify each of the Trustee and its officers, agents and employees and any predecessor Trustee (each, an “Indemnified Party”, and, collectively, the “Indemnified Parties”) for, and hold each of them harmless against, any and all loss, damage, claim, liability or expense, including, without limitation, reasonable and documented attorneys’ fees and expenses incurred by each of them in connection with the acceptance or performance of its duties under this Indenture, including the reasonable and documented costs and expenses of enforcing this Indenture against the Company or any Guarantor (including this Section 6.06) and defending itself against any claim (whether asserted by the Company, or any Holder or any other Person) or liability in connection with the exercise or performance of any of its powers or duties hereunder (including, without limitation, settlement costs).  The Trustee shall notify the Company in writing promptly of any claim of which a Responsible Officer of the Trustee has received written notice at its Corporate Trust Office asserted against an Indemnified Party for which such Indemnified Party may seek indemnity; provided that the failure by the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder.  The Company need not pay for any settlement made without its consent, which consent shall not be unreasonably withheld.  Any settlement which affects an Indemnified Party may not be entered into without the consent of such Indemnified Party, unless such indemnified party is given a full and unconditional release from liability with respect to the claims covered thereby and such settlement does not include a statement or admission of fault, culpability, or failure to act by or on behalf of such Indemnified Party.  Any Indemnified Party may have separate counsel, but the fees and expenses of such counsel shall be at the expense of such Indemnified Party unless (i) the Company and the Indemnified Party shall have mutually agreed in writing to the retention of such counsel, (ii) the named parties to any such proceeding include both the Company and the Indemnified Party and representation of both parties by the same counsel would be inappropriate due to actual differing interests between or among them, or (iii) the Company fails to retain counsel reasonably satisfactory to the Indemnified Party, in

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which case the Company shall pay the reasonable and documented fees and expenses of such counsel.

(c)    Notwithstanding the foregoing, the Company need not reimburse the Trustee for any expense or indemnify it against any loss or liability to have been incurred by the Trustee through its own willful misconduct, bad faith or negligence.

(d)    To secure the payment obligations of the Company in this Section 6.06, the Trustee shall have a lien prior to the Notes on all money or property held or collected by the Trustee and such money or property held in trust to pay principal of and interest on particular Notes.

(e)    The obligations of the Company under this Section 6.06 to compensate and indemnify the Trustee, Agents and each predecessor Trustee and to pay or reimburse the Trustee, Agents and each predecessor Trustee for expenses, disbursements and advances shall be the liability of the Company and the lien provided for under this Section 6.06 and shall survive the resignation or removal of the Trustee and the satisfaction, discharge or other termination of this Indenture for any reason, including any termination or rejection hereof under any Bankruptcy Law.

(f)    In addition to, but without prejudice to its other rights under this Indenture, when the Trustee incurs expenses or renders services after an Event of Default specified in Section 5.01(g), (h) or (i) occurs, the expenses (including the reasonable charges and expenses of its counsel) and the compensation for the services are intended to constitute expenses of administration under any Bankruptcy Law.

(g)    For purposes of this Section 6.06, the term “Trustee” shall include any predecessor Trustee; provided, however, that the negligence, willful misconduct or bad faith of any Trustee hereunder shall not affect the rights or any other Trustee hereunder.

SECTION 6.07.    Replacement of Trustee.

(a)    A resignation or removal of the Trustee and appointment of a successor Trustee will become effective only upon the successor Trustee’s acceptance of appointment as provided in this Section 6.07.

(b)    The Trustee may resign at any time by so notifying the Company in writing no later than 30 calendar days prior to the date of the proposed resignation.  The Holders of a majority in principal amount of the outstanding Notes may remove the Trustee by notifying the Company and the removed Trustee in writing no later than 30 calendar days prior to the date of the proposed removal and may appoint a successor Trustee with the Company’s written consent, which consent shall not be unreasonably withheld.  The Company may remove the Trustee at its election if:

(i)    the Trustee fails to comply with Section 6.09;

(ii)    the Trustee is adjudged bankrupt or insolvent or an order for relief entered with respect to the Trustee under Bankruptcy Law;

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(iii)    a receiver or other public officer takes charge of the Trustee or its property; or

(iv)    the Trustee otherwise becomes incapable of acting.

(c)    If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company shall promptly appoint a successor Trustee.

(d)    If a successor Trustee does not take office within 30 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of at least 10% in principal amount of the outstanding Notes may petition at the expense of the Company any court of competent jurisdiction, in the case of the Trustee, for the appointment of a successor Trustee.

(e)    If the Trustee fails to comply with Section 6.09, any Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

(f)    A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company.  Immediately following such delivery, the retiring Trustee shall, subject to the lien and its rights under Section 6.06, transfer all property held by it as Trustee to the successor Trustee, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture.  A successor Trustee shall transmit notice of its succession to each Holder.  Notwithstanding replacement of the Trustee pursuant to this Section 6.07, the lien and Company’s obligations under Section 6.06 shall continue for the benefit of the retiring Trustee.

SECTION 6.08.    Successor Trustee by Consolidation, Merger, etc.

Any Person into which the Trustee or any successor to it in the trusts created by this Indenture shall be merged or converted, or any Person with which it or any successor to it shall be consolidated, or any Person resulting from any merger, conversion or consolidation to which the Trustee or any such successor to it shall be a party, or any Person to which the Trustee or any successor to it shall sell or otherwise transfer all or substantially all of the corporate trust business of the Trustee, shall be the successor Trustee under this Indenture without the execution or filing of any paper or any further act on the part of any of the parties hereto; provided that such Person shall be otherwise qualified and eligible under this Article VI.  In case at the time such successor to the Trustee (if acting as the Authentication Agent) shall succeed to the trusts created by this Indenture with respect to one or more series of Notes, any of such Notes shall have been authenticated but not delivered by the Trustee (if acting as the Authentication Agent) then in office, any successor to such Trustee (if acting as the Authentication Agent) may adopt the certificate of authentication of any predecessor Trustee, and deliver such Notes so authenticated; and in case at that time any of the Notes shall not have been authenticated, any successor to the Trustee may authenticate such Notes either in the name of any predecessor hereunder or in the name of the successor Trustee; provided, however, that the right to adopt the certificate of authentication of any predecessor Trustee (if acting as the Authentication Agent) or

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authenticate Notes in the name of any predecessor Trustee shall apply only to its successor or successors by merger, conversion or consolidation.

SECTION 6.09.    Eligibility; Disqualification.

There will at all times be a Trustee hereunder that is a Person organized and doing business under the laws of the United States of America or of any state thereof that is authorized under such laws to exercise corporate trustee power, that is subject to supervision or examination by federal or state authorities.  The Trustee (together with its corporate parent) shall have a combined capital and surplus of at least $100.0 million as set forth in the most recent applicable published annual report of condition.

The Trustee shall not be deemed to have a conflict of interest under or in respect of its duties under this Indenture except and to the extent provided for in TIA §310(b)(1); provided, however, that there shall be excluded from the operation of TIA §310(b)(1) any indenture or indentures under which other securities or certificates of interest or participation in other securities of the Company are outstanding if the requirements for such exclusion set forth in TIA §310(b)(1) are met, other than the fact that such indentures are not described herein.

SECTION 6.10.    Reports by Trustee to Holders.

If required by TIA §313(a), within 60 days after (i) the first anniversary of the first date of issuance of Notes hereunder and (ii) each anniversary of such date, the Trustee shall transmit to each Holder a brief report dated as of such date that complies with TIA § 313(a) (but if no event described in TIA §313(a) has occurred within the twelve months preceding the reporting date, no report need be transmitted).  The Trustee also shall comply with TIA §313(b)(2).  The Trustee shall also transmit all reports as required by TIA §313(c) and comply with TIA §313(d).

SECTION 6.11.    Preferential Collection of Claims Against Company.

The Trustee shall comply with TIA § 311(a).  A Trustee who has resigned or been removed shall be subject to TIA § 311(a) to the extent indicated therein.

ARTICLE VII Amendment, Supplement and Waiver

SECTION 7.01.    Without Consent of Holders.

The Company, the Guarantors and the Trustee may, without the consent of any Holder of a Note of any series, from time to time and at any time, enter into a supplemental indenture amending or supplementing this Indenture, the Notes or the Guarantees in order to:

(a)    convey, transfer, assign, mortgage or pledge to the Holders of the Notes of any series or any person acting on their behalf as security for the Notes of such series any property or assets;

(b)    evidence the succession of another person to the Company or any Guarantor, as the case may be, or successive successions, and the assumption by the successor

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person(s) of the covenants, agreements and obligations of the Company or any Guarantor, as the case may be, pursuant to this Indenture;

(c)    evidence and provide for the acceptance of appointment of a successor or successors to the Trustee and/or the Paying Agent, Transfer Agent, Calculation Agent and Registrar, as applicable;

(d)    add to the covenants of, or the restrictions, conditions or provisions applicable to, the Company and any Guarantor, as the case may be, such further covenants, restrictions, conditions or provisions as the Company and any Guarantor, as the case may be, shall consider to be for the protection of the Holders of the Notes of any series issued pursuant to this Indenture, including to eliminate one or both prongs of the release provision under Section 9.07 hereof, and to make the occurrence, or the occurrence and continuance, of a default in any such additional covenants, restrictions, conditions or provisions an Event of Default under this Indenture permitting the enforcement of all or any of the several remedies provided in this Indenture; provided that, in respect of any such additional covenant, restriction, condition or provision, such supplemental indenture may provide for a particular period of grace after default (which may be shorter or longer than that allowed in the case of other defaults) or may limit the remedies available to the Trustee upon such an Event of Default;

(e)    modify the restrictions on, and procedures for, resale and other transfers of the Notes of such series pursuant to law, regulation or practice relating to the resale or transfer of restricted securities generally;

(f)    cure any ambiguity or to correct or supplement any provision contained in this Indenture, the Notes, or the Guarantees which may be defective or inconsistent with any other provision contained therein or to make such other provision in regard to matters or questions arising under this Indenture, the Notes or the Guarantees as the Company, any Guarantor or the Trustee may deem necessary or desirable and which will not, in the opinion of the Company, adversely affect the interests of the Holders of the Notes of such series in any material respect;

(g)    issue an unlimited aggregate principal amount of Notes under this Indenture or to “reopen” the applicable series of Notes and create and issue additional notes having substantially identical terms and conditions as the Notes of such series (or in all respects except as to issue price, denomination, rate of interest, Maturity Date and the date from which interest, if any, shall accrue, and except as may otherwise be provided in or pursuant to such Officer’s Certificate or supplemental indenture relating thereto) so that the additional notes are consolidated and form a single series with the outstanding Notes of such series; and

(h)    evidence the addition of any new Guarantor of the Notes and this Indenture, or the release of any Guarantor from its obligations with respect to the Notes and this Indenture pursuant to the terms of this Indenture.

Upon the written request of the Company accompanied by a Board Resolution authorizing the execution of any such supplemental indenture and upon receipt by the Trustee of the documents described in Section 7.05, the Trustee shall join with the Company and the

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Guarantors in the execution of such supplemental indenture unless such supplemental indenture affects the Trustee’s own rights, duties, liabilities or immunities under this Indenture, in which case the Trustee may, but shall not be obligated to, enter into such supplemental indenture.

SECTION 7.02.    With Consent of Holders.

(a)    The Company, each Guarantor and the Trustee, with the consent of the Holders of not less than a majority in aggregate principal amount of all series of the Notes affected by such supplemental indenture (voting as one class) at the time outstanding under this Indenture (including consents obtained in connection with a tender offer or exchange offer for the applicable Notes), from time to time and at any time, may enter into a supplemental indenture for the purpose of amending, waiving or otherwise modifying the provisions of this Indenture, the Notes and the Guarantees, or adding any provisions to or changing in any manner or eliminating any of the provisions of the applicable Notes or of modifying in any manner the rights of the Holders of the applicable Notes; provided, that no such supplemental indenture may, without the consent of the Holder of each of the Notes so affected:

(i)    change the Stated Maturity of the applicable Note of, or the date for payment of any principal of, or installment of interest on, any applicable Note, or reduce the amount of principal of an Original Issue Discount Note that would be due and payable upon a declaration of acceleration of the maturity thereof pursuant to Section 5.02;

(ii)    reduce the principal amount of or the rate or amount of interest on any applicable Note or Additional Amounts payable with respect thereto or reduce the amount payable thereon in the event of redemption or default or change the method for determining the interest rate thereon;

(iii)    change the currency of payment of principal of or interest on any applicable Note or Additional Amounts payable with respect thereto or change the obligation of the Company or any Guarantor, as the case may be, to pay Additional Amounts (except as otherwise permitted by such applicable Note);

(iv)    impair the right to institute suit for the enforcement of any such payment on or with respect to any applicable Note;

(v)    reduce the percentage of the aggregate principal amount of the applicable Notes outstanding the consent of whose Holders is required for any such supplemental indenture; or

(vi)    reduce the aggregate principal amount of any applicable Note outstanding necessary to modify or amend this Indenture or any such Note or to waive any future compliance or past default or reduce the quorum requirements or the percentage of aggregate principal amount of any applicable Notes outstanding required for the adoption of any action at any meeting of Holders of such Notes or to reduce the percentage of the aggregate principal amount of such Notes outstanding necessary to rescind or annul any declaration of the principal of, or all accrued and unpaid interest on, any Note to be due and payable;

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provided that no consent of any Holder of any applicable Note shall be necessary to permit the Trustee, the Company and each Guarantor to execute supplemental indentures as described under Section 7.01.

(b)    In determining whether the Holders of the required principal amount of a series of Notes have concurred in any direction, notice, waiver or consent, Notes owned by the Company or any subsidiary of the Company, or by any Affiliate of the Company will be considered as though not outstanding, except that for the purposes of determining whether the Trustee will be protected in conclusively relying on any such direction, notice, waiver or consent, only Notes that a Responsible Officer of the Trustee actually knows are so owned will be so disregarded.

(c)    It is not necessary for the consent of the Holders under this Section 7.02 to approve the particular form of any proposed amendment, supplement or waiver, but it is sufficient if such consent approves the substance thereof.

After an amendment that requires the consent of the Holders of the affected Notes becomes effective, the Company shall transmit to each registered Holder of the affected Notes pursuant to Section 10.01 a notice briefly describing such amendment.  However, the failure to give such notice to all Holders of such Notes, or any defect therein, shall not impair or affect the validity of the amendment.

Upon the written request of the Company accompanied by a Board Resolution authorizing the execution of any such supplemental indenture, and upon the receipt by the Trustee of evidence of the consent of the Holders as aforesaid and upon receipt by the Trustee of the documents described in Section 7.05, the Trustee shall join with the Company and the Guarantors in the execution of such supplemental indenture unless such supplemental indenture affects the Trustee’s own rights, duties, liabilities or immunities under this Indenture, in which case the Trustee may, but shall not be obligated to, enter into such supplemental indenture.

SECTION 7.03.    Revocation and Effect of Consents.

After an amendment, supplement, waiver or other action becomes effective, a consent to it by a Holder of a Note is a continuing consent conclusive and binding upon such Holder and every subsequent Holder of the same Note or portion thereof, and of any Note issued upon the transfer thereof or in exchange therefor or in place thereof, even if notation of the consent is not made on any such Note.  However, any such Holder of a Note or subsequent Holder of a Note may revoke the consent as to its Note if the Trustee receives written notice of revocation before the date the amendment, supplement or waiver becomes effective.  An amendment, supplement or waiver becomes effective in accordance with its terms and thereafter binds every Holder, whether or not they have consented to such action or were present at the meeting at which such action was taken and every subsequent Holder of the same Note or portion thereof, and of any Note issued upon the transfer thereof or in exchange therefor or in place thereof, even if notation of the consent is not made on any such Note.

The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Holders entitled to consent to any amendment, supplement, or waiver.  If a

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record date is fixed, then, notwithstanding the preceding paragraph, those Persons who were Holders at such record date (or their duly designated proxies), and only such Persons, shall be entitled to consent to such amendment, supplement, or waiver or to revoke any consent previously given, whether or not such Persons continue to be Holders after such record date.  No such consent shall be valid or effective for more than 90 days after such record date unless the consent of the requisite number of Holders has been obtained.

SECTION 7.04.    Notation on or Exchange of Notes.

If an amendment, supplement, or waiver changes the terms of a Note, the Paying Agent (in accordance with the specific written direction of the Company) shall request the Holder of the Note (in accordance with the specific written direction of the Company) to deliver it to the Paying Agent.  In such case, the Paying Agent shall place an appropriate notation (in accordance with a specific written direction from the Company) on the Note about the changed terms and return it to the Holder.  Alternatively, if the Company so determines, the Company in exchange for the Note shall issue and the Authentication Agent shall authenticate a new Note that reflects the changed terms.  Failure to make the appropriate notation or issue a new Note shall not affect the validity and effect of such amendment, supplement or waiver.

SECTION 7.05.    Trustee To Sign Amendments, etc.

The Trustee shall sign any amendment, supplement or waiver authorized pursuant to this Article VII if the amendment, supplement or waiver does not affect the rights, duties, liabilities or immunities of the Trustee.  If it does affect the rights, duties, liabilities or immunities of the Trustee, the Trustee may, but need not, sign such amendment, supplement or waiver.  In signing or refusing to sign such amendment, supplement or waiver the Trustee shall be entitled to receive and, subject to Section 6.01, shall be fully protected in relying upon an Officer’s Certificate and an Opinion of Counsel stating, in addition to the matters required by Section 10.02, that such amendment, supplement or waiver is authorized or permitted by this Indenture, and, in the case of the Opinion of Counsel, that such amendment or supplemental indenture is valid and binding on the Company and the Guarantors in accordance with its terms.

ARTICLE VIII Satisfaction and Discharge of Indenture; Defeasance

SECTION 8.01.    Satisfaction and Discharge of Liability on Notes; Defeasance.

(a)    This Indenture will be discharged and will cease to be of further effect with respect to any Notes or any series of Notes (except as to rights of registration of transfer or exchange of Notes and rights to receive principal of and premium, if any, and interest on such Notes) as to all outstanding Notes of such series issued hereunder when:

(i)    either:

(a)    all the Notes of such series that have been authenticated and delivered (except lost, stolen or destroyed Notes which have been replaced or paid and Notes for whose payment money has been deposited in trust or segregated and held in trust by the

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Company and thereafter repaid to the Company or discharged from this trust) have been delivered to the Paying Agent for cancellation; or

(b)    all Notes of such series not delivered to the Paying Agent for cancellation otherwise (i) have become due and payable; (ii) will become due and payable within one year; or (iii) have been called for redemption within one year pursuant to the provisions described in the form of notes of such series and, in any case, the Company or any Guarantor has irrevocably deposited or caused to be deposited with the Trustee as trust funds, in trust solely for the benefit of the Holders of such Notes, (x) money in the currency in which payment of the Notes of such series is to be made in an amount; (y) Government Obligations with respect to such series, maturing as to principal and interest at such times and in such amounts as will ensure the availability of money in the currency in which payment of the Notes of such series is to be made in an amount; or (z) a combination thereof, that is sufficient (without consideration of any reinvestment of interest) to pay and discharge the entire indebtedness (including all principal and accrued interest) on the Notes of such series not theretofore delivered to the Paying Agent for cancellation;

(ii)    the Company or any Guarantor has paid all sums payable by it with respect to such series under this Indenture; and

(iii)    the Company has delivered irrevocable instructions to the Trustee to apply the deposited money toward the payment of the Notes of such series at maturity or on the Redemption Date, as the case may be.

In addition, the Company must deliver to the Trustee an Officer’s Certificate and an Opinion of Counsel stating that all conditions precedent to satisfaction and discharge have been complied with.

(b)    Subject to clause (c) of this Section 8.01 and Section 8.02, the Company may, at its option and at any time, elect to have its obligations and the obligations of the Guarantors discharged with respect to the outstanding Notes of a series (“Legal Defeasance”).  Legal Defeasance means that the Company and the Guarantors shall be deemed to have paid and discharged the entire indebtedness represented by the Notes of such series and the related Guarantees, and this Indenture shall cease to be of further effect as to all outstanding Notes of such series and the related Guarantees, on the 91st day after the applicable conditions described in Section 8.02 have been satisfied, except as to:

(i)    the rights of Holders of such series of Notes issued under this Indenture to receive payments in respect of the principal of, premium, if any, and interest on such Notes when such payments are due solely out of the trust created pursuant to this Indenture;

(ii)    the Company’s obligations with respect to such series Notes concerning issuing temporary Notes under Section 2.11, registration of Notes under Section 2.04, mutilated, destroyed, lost or stolen Notes under Section 2.08, and the maintenance of an

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office or agency for payment under Section 2.04 and money for security payments held in trust under Section 2.05;

(iii)    the rights, powers, trust, duties, and immunities of the Trustee, and the Company’s obligation in connection therewith; and

(iv)    the applicable provisions of this Article VIII.

In addition, the Company may, at its option and at any time, elect to have its obligations and the obligations of the Guarantors released with respect to (A) their respective obligations under Sections 4.09 and 4.10 with respect to the outstanding Notes of a series and (B) the operation of Section 5.01 (“Covenant Defeasance”) on and after the conditions in Section 8.02 with respect to Covenant Defeasance are satisfied, and thereafter any omission to comply with such obligations shall not constitute a Default or Event of Default with respect to such Notes.  The Company may exercise its Legal Defeasance option regardless of whether it previously exercised Covenant Defeasance.

(c)    If the Company exercises its Legal Defeasance option, payment of the Notes of such series may not be accelerated because of an Event of Default with respect thereto.

(d)    Upon satisfaction of the conditions set forth herein and upon request of the Company, the Trustee shall acknowledge in writing the discharge of those obligations that the Company terminates.

(e)    Notwithstanding clauses (a) and (b) of this Section 8.01, the Company’s obligations in Sections 2.04, 2.06, 2.07, 2.08, 6.06, 8.05 and 8.06 shall survive with respect to such series of Notes until such time as the Notes of such series have been paid in full.  Thereafter, the Company’s obligations in Sections 6.06, 8.05 and 8.06 shall survive.

SECTION 8.02.    Conditions to Defeasance.

In order to exercise either Legal Defeasance or Covenant Defeasance with respect to the Notes of any series:

(a)    the Company must irrevocably deposit with the Trustee, as trust funds, in trust solely for the benefit of the Holders of the Notes of such series (i) money in the currency in which payment of the Notes of such series is to be made in an amount, (ii) Government Obligations with respect to such series, maturing as to principal and interest at such times and in such amounts as will ensure the availability of money in the currency in which payment of the Notes of such series is to be made in an amount or (iii) a combination thereof, that will be sufficient (without consideration of any reinvestment of interest) in the opinion of a certified public accounting firm of national reputation selected by the Company, to pay the principal of and interest on the Notes of such series on the stated date for payment or on the Redemption Date of the principal or installment of principal of, or interest on such series of Notes;

(b)    in the case of Legal Defeasance, the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that the beneficial owners of Notes of such series will not recognize income, gain or loss for U.S. federal income tax purposes as a result of the

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Legal Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred, which opinion must be based either on a change in the applicable U.S. federal income tax laws or regulations occurring after the date hereof or the Company having received a ruling from, or published by, the Internal Revenue Service to that effect;

(c)    in the case of Covenant Defeasance, the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that the beneficial owners of Notes of such series will not recognize income, gain or loss for U.S. federal income tax purposes solely as a result of such Covenant Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if the Covenant Defeasance had not occurred;

(d)    no Default or Event of Default shall have occurred and be continuing on the date of such deposit; and

(e)    the Company shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel each stating that all conditions precedent provided for or relating to the Legal Defeasance or the Covenant Defeasance, as the case may be, have been complied with.

If the funds deposited with the Trustee to effect Covenant Defeasance are insufficient to pay the principal of and interest on the Notes of the applicable series when due, then the Company’s obligations and the obligations of the Guarantors under this Indenture will be revived with respect to such series and no such defeasance will be deemed to have occurred.

SECTION 8.03.    Deposited Money and Government Obligations To Be Held in Trust; Other Miscellaneous Provisions.

All money and Government Obligations (including the proceeds thereof) deposited with the Trustee pursuant to Section 8.02(a) in respect of the outstanding Notes of a series shall be held in trust and applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment to the Holders of such Notes, of all sums due and to become due thereon in respect of principal, premium, if any, and accrued interest, but such money need not be segregated from other funds except to the extent required by law.

The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the Government Obligations deposited pursuant to Section 8.02(a) or the principal, premium, if any, and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of the outstanding Notes.

Anything in this Article VIII to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon a request of the Company any money or Government Obligations held by it as provided in Section 8.02(a) which, in the opinion of a certified public accounting firm of national reputation selected by the Company expressed in a written certification thereof delivered to the Trustee, are in excess of the amount thereof which would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.

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SECTION 8.04.    Reinstatement.

If the Trustee is unable to apply any money or Government Obligations in accordance with Section 8.01 by reason of any legal proceeding or by reason of any order or judgment of any court or Governmental Authority enjoining, restraining or otherwise prohibiting such application, the Company’s obligations under this Indenture and the applicable Notes shall be revived and reinstated as though no deposit had occurred pursuant to this Article VIII until such time as the Trustee is permitted to apply all such money or Government Obligations in accordance with Section 8.01; provided that if the Company has made any payment of principal of, premium, if any, or accrued interest on any Notes because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Notes to receive such payment from the money or Government Obligations held by the Trustee.

SECTION 8.05.    Moneys Held by Paying Agent.

In connection with the satisfaction and discharge of this Indenture, all moneys then held by any Paying Agent under the provisions of this Indenture shall, upon written demand of the Company, be paid to the Trustee, or if sufficient moneys have been deposited with the Trustee pursuant to Section 8.02(a), any excess funds to the Company upon a request of the Company, and thereupon the Paying Agent shall be released from all further liability with respect to such moneys.

SECTION 8.06.    Moneys Held.

Subject to any applicable abandoned property laws, any money deposited with the Trustee or the Paying Agent, or then held by the Company, for the payment of the principal of (and premium, if any) or interest on the Notes of a series and remaining unclaimed for two years after such principal (and premium, if any) or interest has become due and payable shall be paid to the Company on Company Order, or (if then held by the Company) shall be discharged; and the Holder of such Note shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of the Trustee or the Paying Agent with respect to such money, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or the Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in a newspaper published in the English language, customarily published on each Business Day and of general circulation in New York, New York, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to the Company.

ARTICLE IX Guarantees

SECTION 9.01.    Guarantee.

(a)    Each Guarantor, hereby jointly and severally, fully, unconditionally and irrevocably guarantees the Notes and obligations of the Company hereunder and thereunder, and guarantees to each Holder of a Note authenticated and delivered by the Authentication Agent,

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and to the Trustee on behalf of such Holder, that (i) the principal of (and premium, if any) and interest on the Notes will be paid in full when due, whether at Stated Maturity, by acceleration or otherwise (including, without limitation, the amount that would become due but for the operation of any automatic stay provision of any Bankruptcy Law), together with interest on the overdue principal, if any, and all other obligations of the Company to the Holders or the Trustee hereunder or thereunder will be paid in full or performed, all in accordance with the terms hereof and thereof; and (ii) in case of any extension of time of payment or renewal of any Notes or of any such other obligations, the same will be paid in full when due or performed in accordance with the terms of the extension or renewal, whether at Stated Maturity, by acceleration or otherwise, subject, however, in the case of clauses (i) and (ii) above, to the limitations set forth in Section 9.03.

Each Guarantor hereby agrees that its obligations hereunder shall be unconditional, irrespective of the validity, regularity or enforceability of the Notes or this Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder of Notes with respect to any provisions hereof or thereof, any release of any other Guarantor, the recovery of any judgment against the Company, any action to enforce the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of any Guarantor.

(b)    Each Guarantor hereby waives (to the extent permitted by law) the benefits of diligence, presentment, demand for payment, filing of claims with a court in the event of insolvency or bankruptcy of the Company, any right to require a proceeding first against the Company or any other Person, protest, notice and all demands whatsoever and covenants that, subject to Section 9.07, the Guarantee of such Guarantor shall not be discharged as to any series of Notes, unless paid or provided for in accordance with the obligations contained in such series of Notes, this Indenture and such Guarantee.  Each Guarantor acknowledges that the Guarantee is a guarantee of payment and not of collection.  Each Guarantor hereby agrees that, in the event of a default in payment of principal (or premium, if any) or interest on such Note, whether at its Stated Maturity, by acceleration, purchase or otherwise, legal proceedings may be instituted by the Trustee on behalf of, or by, the Holder of such Note, subject to the terms and conditions set forth in this Indenture, directly against each Guarantor to enforce such Guarantor’s Guarantee without first proceeding against the Company or any other Guarantor.  Each Guarantor agrees that if, after the occurrence and during the continuance of an Event of Default, the Trustee or any of the Holders are prevented by applicable law from exercising their respective rights to accelerate the maturity of the Notes, to collect interest on the Notes, or to enforce or exercise any other right or remedy with respect to the Notes, such Guarantor will pay to the Trustee for the account of the Holders, upon demand therefor, the amount that would otherwise have been due and payable had such rights and remedies been permitted to be exercised by the Trustee or any of the Holders.

(c)    If any Holder or the Trustee is required by any court or otherwise to return to the Company or any Guarantor, or any custodian, trustee, liquidator or other similar official acting in relation to either the Company or any Guarantor, any amount paid by any of them to the Trustee or such Holder, the Guarantee of each Guarantor, to the extent theretofore discharged, shall be reinstated in full force and effect.  Each Guarantor further agrees that, as between each Guarantor, on the one hand, and the Holders and the Trustee, on the other hand, (x) subject to

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this Article IX, the maturity of the obligations guaranteed hereby may be accelerated as provided in Article V for the purposes of the Guarantee of such Guarantor, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby, and (y) in the event of any acceleration of such obligations as provided in Article V, such obligations (whether or not due and payable) shall forthwith become due and payable by each Guarantor for the purpose of the Guarantee of such Guarantor.

(d)    Each Guarantee shall remain in full force and effect and continue to be effective should any petition be filed by or against the Company for liquidation or reorganization, should the Company become insolvent or make an assignment for the benefit of creditors or should a receiver or trustee be appointed for all or any significant part of the Company’s assets, and shall, to the fullest extent permitted by law, continue to be effective or be reinstated, as the case may be, if at any time payment and performance of the Notes are, pursuant to applicable law, rescinded or reduced in amount, or must otherwise be restored or returned by any obligee on the Notes, whether as a “voidable preference”, “fraudulent transfer” or otherwise, all as though such payment or performance had not been made.  In the event that any payment, or any part thereof, is rescinded, reduced, restored or returned, the Notes shall, to the fullest extent permitted by law, be reinstated and deemed reduced only by such amount paid and not so rescinded, reduced, restored or returned.

SECTION 9.02.    Severability.

In case any provision of any Guarantee shall be invalid, illegal or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

SECTION 9.03.    Limitation of Liability.

Each Guarantor and by its acceptance hereof each Holder confirms that it is the intention of all such parties that the guarantee by each such Guarantor pursuant to its Guarantee not constitute a fraudulent transfer or conveyance for purposes of the Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law or the provisions of its local law relating to fraudulent transfer or conveyance.  To effectuate the foregoing intention, the Holders and each such Guarantor hereby irrevocably agree that the obligations of such Guarantor under its Guarantee shall be limited to the maximum amount that will not, after giving effect to all other contingent and fixed liabilities of such Guarantor and after giving effect to any collections from or payments made by or on behalf of any other Guarantor in respect of the obligations of such other Guarantor under its Guarantee or pursuant to this Article IX, result in the obligations of such Guarantor under its Guarantee constituting such fraudulent transfer or conveyance.

SECTION 9.04.    Contribution.

In order to provide for just and equitable contribution among the Guarantors, the Guarantors agree, inter se, that in the event any payment or distribution is made by any Guarantor under a Guarantee, such Guarantor will be entitled to a contribution from any other

53


Guarantor in a pro rata amount based on the net assets of each Guarantor determined in accordance with IFRS.

SECTION 9.05.    Subrogation.

Each Guarantor shall be subrogated to all rights of Holders against the Company in respect of any amounts paid by any Guarantor pursuant to the provisions of Section 9.01; provided, however, that if an Event of Default has occurred and is continuing, no Guarantor shall be entitled to enforce or receive any payments arising out of, or based upon, such right of subrogation until all amounts then due and payable by the Company under this Indenture or the Notes shall have been paid in full.

SECTION 9.06.    Reinstatement.

Each Guarantor hereby agrees (and each Person who becomes a Guarantor shall agree) that the Guarantee provided for in Section 9.01 shall continue to be effective or be reinstated, as the case may be, if at any time, payment, or any part thereof, of any obligations or interest thereon is rescinded or must otherwise be restored by a Holder to the Company upon the bankruptcy or insolvency of the Company or any Guarantor.

SECTION 9.07.    Release of a Guarantor.

Without the consent of the Trustee or the Holders, any Guarantor that is a subsidiary of the Parent (a “Subsidiary Guarantor”), other than BATIF and BATNF, will automatically and unconditionally be released from all obligations under its Guarantee, and such Guarantee shall thereupon terminate and be discharged and of no further force or effect, in the event that (i) its guarantee of all then outstanding notes issued under the EMTN Programme is released; or (ii) at substantially the same time its Guarantee of the Notes is terminated, the Subsidiary Guarantor is released from all obligations in respect of indebtedness for borrowed money for which such Subsidiary Guarantor is an obligor (as a guarantor or borrower).  For purposes of this Section 9.07, the amount of a Subsidiary Guarantor’s indebtedness for borrowed money shall not include (a) the Notes issued pursuant to this Indenture; (b) any other debt the terms of which permit the termination of such Subsidiary Guarantor’s guarantee of such debt under similar circumstances, as long as such Subsidiary Guarantor’s obligations in respect of such other debt are terminated at substantially the same time as its guarantee of the Notes; (c) any debt that is being refinanced at substantially the same time that the guarantee of the Notes is being released; provided that any obligations of the relevant Subsidiary Guarantor in respect of the debt that is incurred in the refinancing shall be included in the calculation of the relevant Subsidiary Guarantor’s indebtedness for borrowed money; and (d) for the avoidance of doubt, any debt in respect of which such Subsidiary Guarantor is an obligor (as a guarantor or borrower) (A) between or among the Parent and any subsidiary or subsidiaries thereof; or (B) between or among any subsidiaries of the Parent.

SECTION 9.08.    Benefits Acknowledged.

Each Guarantor acknowledges that it will receive direct and indirect benefits from the financing arrangements contemplated by this Indenture and that its respective Guarantee is knowingly made in contemplation of such benefits.

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ARTICLE X Miscellaneous

SECTION 10.01.    Notices.

Except for notice or communications to Holders, any notice or communication shall be given in writing and is duly given when received if delivered in person, when receipt is acknowledged if sent by facsimile, on the next Business Day if timely delivered by a nationally recognized courier service that guarantees overnight delivery or if mailed by first-class mail guaranteeing next day delivery, postage prepaid, addressed as follows:

 
If to the Company or any Guarantor:
    
 
British American Tobacco p.l.c.
 
Globe House
 
4 Temple Place
 
London WC2R 2PG
 
United Kingdom
 
Facsimile: +44 (0)20 7845 0555
 
Attention: Company Secretary
    
 
With a copy (which shall not constitute notice) to:
   
 
Cravath, Swaine & Moore LLP
 
CityPoint
 
1 Ropemaker Street
 
London EC2Y 9HR
 
United Kingdom
 
Facsimile: +44 (0)20 7860 1150
 
Attention: Alyssa K. Caples
   
 
If to the Trustee:
   
 
Mailing Address:
   
 
Citibank, N.A.
 
Agency & Trust
 
388 Greenwich Street
 
New York, NY 10013
 
Facsimile: (347) 394-0960
 
Attention: Kerry Hehir
   
  If to the Authentication Agent, Registrar, Transfer Agent, Paying Agent and Calculation Agent:
   
  Mailing Address:

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Citibank, N.A.
 
Agency & Trust
 
388 Greenwich Street
 
New York, NY 10013
 
Facsimile: (347) 394-0960
 
Attention: Kerry Hehir

Such notices or communications shall be effective and sufficiently given if so given within the manner and time prescribed in this Indenture; provided, however, that notwithstanding the foregoing, no notice or communication to the Trustee, any Agent, the Company or any Guarantor shall be deemed duly given until actually received by the Trustee, such Agent, the Company or any Guarantor, as applicable.

The Company, the Guarantors, the Trustee or the Agents by written notice to the others may designate additional or different addresses for subsequent notices or communications.

The Trustee and each Agent shall have the right, but shall not be required, to rely upon and comply with instructions and directions sent by email, facsimile and other similar unsecured electronic methods by persons believed by the Trustee and each Agent, as applicable, to be authorized to give instructions and directions on behalf of the Company.  The Trustee and each Agent, as applicable, shall have no duty or obligation to verify or confirm that the person who sent such instructions or directions is, in fact, a person authorized to give instructions on behalf of the Company; and the Trustee and each Agent, as applicable, shall have no liability for any losses, liabilities, costs or expenses incurred or sustained by the Company as a result of such reliance upon or compliance with such instructions or directions; provided that such reliance was in good faith.  The Company agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Trustee or any Agent, as applicable, including without limitation the risk of the Trustee or such Agent acting on unauthorized instructions, and all the risk of interception and misuse by third parties.

Notices to holders of Notes will be given by first-class mail postage prepaid to the last addresses of such holders as they appear in the Notes register.  Such notices will be deemed to have been given on the date of such mailing; provided, no such mailing will be required so long as any Global Notes representing the Notes are held in their entirety on behalf of the Depositary or a clearing system, or any of its participants.  In such case, there may be substituted for the mailing of notice to holders of Notes described above the delivery of the relevant notices to the Depositary or a clearing system, and (if applicable) its participants, for communication by them to the entitled accountholders.  Any such notice shall be deemed to have been given on the day on which the said notice was given to the Depositary or a clearing system, and (if applicable) its participants.

Failure to transmit a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders.  If a notice or communication to a Holder is transmitted in the manner provided above, it shall be deemed duly given, whether or not the addressee receives it.

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If the Company transmits a notice or communication to Holders, it will transmit a copy to the Trustee and each Agent at the same time.

In case by reason of the suspension of regular mail service, or by reason of any other cause, it shall be impossible to mail any notice as required by this Indenture, then such method of notification as shall be made with the consultation of the Trustee shall constitute a sufficient mailing of such notice.

SECTION 10.02.    Certificate and Opinion as to Conditions Precedent.

Upon any request or application by the Company to the Trustee to take any action under this Indenture, if so requested by the Trustee, the Company shall furnish to the Trustee:

(a)    an Officer’s Certificate (which must include the statements set forth in Section 10.03) stating that, in the opinion of the signers, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and

(b)    an Opinion of Counsel (which must include the statements set forth in Section 10.03) stating that, in the opinion of such counsel, all such conditions precedent have been complied with.

SECTION 10.03.    Statements Required in Certificate and Opinion.

Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture must include (other than a certificate provided pursuant to Section 4.12):

(a)    a statement that the Person making such certificate or opinion has read such covenant or condition;

(b)    a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

(c)    a statement that, in the opinion of such Person, he or she has made such examination or investigation as is necessary to enable him or her to express an informed opinion as to whether or not such covenant or condition has been complied with; and

(d)    a statement as to whether or not, in the opinion of such Person, such condition or covenant has been complied with.

SECTION 10.04.    Communications by Holders with Other Holders.

Holders may communicate pursuant to TIA §312(b) with other Holders with respect to their rights under this Indenture or the Notes.  The Company, the Trustee, the Registrar and anyone else shall have the protection of TIA §312(c).

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SECTION 10.05.    Rules by Trustee and Agents.

The Trustee may make reasonable rules for action by or at a meeting of Holders.  The Registrar or Paying Agent may make reasonable rules and set reasonable requirements for its functions.

SECTION 10.06.    No Personal Liability of Directors, Officers, Employees and Stockholders.

No director, officer, employee or stockholder of the Company or any Guarantor, past, present or future, will have any liability for any of the Company’s or such Guarantor’s obligations under the Notes or this Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation.  Each Holder of Notes by accepting a Note waives and releases all such liability.  The waiver and release are part of the consideration for issuance of the Notes.

SECTION 10.07.    Governing Law; Waiver of Jury Trial; Jurisdiction.

THE INTERNAL LAW OF THE STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW OR ANY SUCCESSOR TO SUCH STATUTE) WILL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE, THE NOTES AND THE GUARANTEES WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

EACH PARTY HEREBY, AND EACH HOLDER OF A NOTE BY ITS ACCEPTANCE THEREOF, WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, OR IN CONNECTION WITH THIS INDENTURE.

ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS INDENTURE AND ANY ACTION FOR ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF MAY BE BROUGHT IN THE COURTS OF THE STATE IN ANY STATE OR FEDERAL COURT IN THE BOROUGH OF MANHATTAN, THE CITY OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS INDENTURE, EACH OF THE PARTIES HERETO HEREBY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS AND APPELLATE COURTS FROM ANY THEREOF.  THE COMPANY HERETO IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE COMPANY AT ITS ADDRESS REFERRED TO IN SECTION 10.01.  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY DO SO UNDER APPLICABLE LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR

58


PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS INDENTURE BROUGHT IN THE COURTS REFERRED TO ABOVE AND TO THE FULLEST EXTENT IT MAY DO SO UNDER APPLICABLE LAW HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.  NOTHING HEREIN SHALL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED IN ANY OTHER JURISDICTION.

SECTION 10.08.    No Adverse Interpretation of Other Agreements.

This Indenture may not be used to interpret any other indenture, loan or debt agreement of the Company or its subsidiaries or of any other Person.  Any such indenture, loan or debt agreement may not be used to interpret this Indenture.

SECTION 10.09.    Successors.

All agreements of the Company in this Indenture and the Notes will bind its successors.  All agreements of the Trustee and each Agent in this Indenture will bind its successors.  All agreements of each Guarantor in this Indenture will bind its successors, except as otherwise provided in Section 9.07.

SECTION 10.10.    Separability.

In case any provision in this Indenture or in the Notes is invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions will not in any way be affected or impaired thereby.

SECTION 10.11.    Counterpart Originals; Effectiveness.

The parties may sign any number of copies of this Indenture.  Each signed copy will be an original, but all of them together represent the same agreement.  The exchange of copies of this Indenture and of signature pages by facsimile or electronic format (i.e., “pdf” or “tif”) transmission shall constitute effective execution and delivery of this Indenture as to the parties hereto and may be used in lieu of the original Indenture for all purposes.  Signatures of the parties hereto transmitted by facsimile or electronic format (i.e., “pdf” or “tif”) shall be deemed to be their original signatures for all purposes.  This Indenture shall become effective as of the date on the cover page of this Indenture upon the execution and delivery hereof by the parties hereto as contemplated hereby.

SECTION 10.12.    Table of Contents, Headings, etc.

The Table of Contents, Cross-Reference Table and Headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part of this Indenture and will in no way modify or restrict any of the terms or provisions hereof.

59


SECTION 10.13.    Benefits of Indenture.

Nothing in this Indenture expressed and nothing that may be implied from any of the provisions hereof is intended, or shall be construed, to confer upon, or to give to, any Person other than the parties hereto and their successors and the Holders of the Notes any benefit or any right, remedy or claim under or by reason of this Indenture or any covenant, condition, stipulation, promise or agreement hereof, and all covenants, conditions, stipulations, promises and agreements in this Indenture contained shall be for the sole and exclusive benefit of the parties hereto and their successors and of the Holders of the Notes.

SECTION 10.14.    Appointment of Agent for Service.

Each non-U.S. Guarantor hereby irrevocably designates the Company, as its agent for service of process in any related proceeding arising out of or relating to the performance of its obligations under this Indenture and the Notes brought in any state or federal court in the Borough of Manhattan, the City of New York, and agrees that service of process in any such related proceeding may be made upon it at the office of such agent, and the Company hereby accepts such designation.  The Company and each Guarantor waive, to the fullest extent permitted by law, any other requirements of or objections to personal jurisdiction with respect thereto.  The Company and each Guarantor agree to take any and all action, including the filing of any and all documents and instruments, that may be necessary to continue such appointment in full force and effect.

[Signatures on following page]


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IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first written above.


  B.A.T CAPITAL CORPORATION,  
       
       

By:
/s/ Neil Wadey
 
    Name:  Neil Wadey
 
    Title:  Director
 
       


  BRITISH AMERICAN TOBACCO P.L.C.,  
       
       

By:
/s/ Tadeu Marroco
 
    Name:
 Tadeu Marroco
 
    Title:  Director
 
       


  B.A.T. INTERNATIONAL FINANCE P.L.C.,  
       
       

By:
/s/ Neil Wadey
 
    Name:  Neil Wadey
 
    Title:  Director
 
       


  B.A.T. NETHERLANDS FINANCE B.V.,  
       
       

By:
/s/ M. Wiechers
 
    Name:  M. Wiechers  
    Title:  Director
 
       


By:
/s/ JEP Bollen
 
    Name:  JEP Bollen
 
    Title:  Director
 
       





  REYNOLDS AMERICAN INC.,  
       
       

By:
/s/ John R. Whitener
 
    Name:  John R. Whitener
 
    Title:  SVP Controller - Finance & Accounting
 
       and Treasurer
 
       


 
CITIBANK, N.A.,
as Trustee
 
       
       

By:
/s/ Cirino Emanuele
 
    Name:  Cirino Emanuele
 
    Title:  Senior Trust Officer
 
       


 
CITIBANK, N.A.,
as Authentication Agent, Transfer Agent, Registrar, Calculation Agent
and initial Paying Agent
 
       
       

By:
/s/ Cirino Emanuele  
    Name:  Cirino Emanuele  
    Title:  Senior Trust Officer
 
       





2
Exhibit 4.2

SUPPLEMENTAL INDENTURE NO. 1 (this “Supplemental Indenture”), dated as of September 6, 2019, among B.A.T Capital Corporation, a corporation incorporated in the state of Delaware (the “Company”), as issuer, British American Tobacco p.l.c., a public limited company incorporated under the laws of England and Wales (the “Parent”), B.A.T. International Finance p.l.c., a public limited company incorporated under the laws of England and Wales (“BATIF”), B.A.T. Netherlands Finance B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of The Netherlands (“BATNF”), and, until its guarantee is released in accordance with the Base Indenture (if ever), Reynolds American Inc., a North Carolina corporation (“RAI”), as guarantors (the “Guarantors”) and Citibank, N.A., as trustee (the “Trustee”).

W I T N E S S E T H

WHEREAS, the Company has heretofore executed and delivered to the Trustee an indenture dated as of September 6, 2019 (the “Base Indenture”), providing for the issuance from time to time of an unlimited aggregate principal amount of guaranteed debt securities;

WHEREAS, Section 7.01(g) of the Base Indenture provides that without the consent of any Holder, the Company, the Guarantors and the Trustee may amend or supplement the Indenture in order to, among other things, issue an unlimited aggregate principal amount of notes under the Base Indenture;

WHEREAS, pursuant to Section 7.01(g) of the Base Indenture, the parties hereto are authorized to execute and deliver this Supplemental Indenture;

WHEREAS, the Company and the Guarantors have taken all necessary corporate action to authorize the execution and delivery of this Supplemental Indenture;

WHEREAS, as contemplated by Section 2.01 of the Base Indenture, the Company intends to issue, and the Guarantors intend to guarantee, a new series of guaranteed debt securities to be known as the Company’s “2.789% Notes due 2024” under the Base Indenture.

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto mutually covenant and agree for the equal and ratable benefit of the Holders of the 2024 Notes (as defined below) as follows:

ARTICLE I

Definitions and Other Provisions of General Application

SECTION 1.01.          Definitions.

Except as otherwise expressly provided in this Supplemental Indenture, all terms used in this Supplemental Indenture which are defined in the Base Indenture shall have the meanings ascribed to them by the Base Indenture.


SECTION 1.02.          Effect of Headings.

The Article and Section headings herein are for convenience only and shall not affect the construction hereof.

SECTION 1.03.          Separability Clause.

In case any provision in this Supplemental Indenture shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

SECTION 1.04.          Benefits of Instrument.

Nothing in this Supplemental Indenture expressed and nothing that may be implied from any of the provisions hereof is intended, or shall be construed, to confer upon, or to give to, any Person other than the parties hereto and their successors and the Holders of the 2024 Notes any benefit or any right, remedy or claim under or by reason of this Supplemental Indenture or any covenant, condition, stipulation, promise or agreement hereof, and all covenants, conditions, stipulations, promises and agreements in this Supplemental Indenture contained shall be for the sole and exclusive benefit of the parties hereto and their successors and of the Holders of the 2024 Notes.

ARTICLE II

2.789% Notes due 2024

SECTION 2.01.          Creation of Series.

There is hereby established a new series of Notes under the Base Indenture entitled “2.789% Notes due 2024” (the “2024 Notes”). The form of the 2024 Notes, including the form of the certificate of authentication, is attached hereto as Exhibit A.

The Company shall issue the 2024 Notes in an aggregate principal amount of $1,000,000,000. The Company may from time to time, without the consent of the Holders of the 2024 Notes, “reopen” the series of 2024 Notes and create and issue additional Notes having substantially identical terms and conditions as the 2024 Notes (or in all respects except as to issue price, denomination, rate of interest, maturity date and the date from which interest, if any, shall accrue, and except as may otherwise be provided in or pursuant to such Officer’s Certificate or supplemental indenture relating thereto) so that the additional Notes are consolidated and form a single series with the outstanding 2024 Notes.

The 2024 Notes shall be initially be represented by one or more 2024 Notes of the same series in registered, global form without interest coupons. The global notes representing the 2024 Notes (collectively, the “2024 Global Notes”) initially shall be (i) be registered in the name of the Depository Trust Company (the “Depositary”) or the nominee of such Depositary, in each case for credit to an account of a member of, or direct or indirect participant in, the Depositary; and (ii) be delivered to Citibank, N.A. as custodian for such Depositary.

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(a)          The maturity date of the principal of the 2024 Notes shall be September 6, 2024 (the “Maturity Date”).

(b)          The outstanding principal amount of the 2024 Notes shall accrue interest at a rate equal to 2.789% per annum, as provided in Section 2.03.

(c)          Unless supplemented or superseded in this Supplemental Indenture, the terms of the 2024 Notes, including any Events of Default and covenants of the Company and the Guarantors are consistent with the Base Indenture and set forth therein.

SECTION 2.02.          Guarantee.

Subject to the terms and applicable limitations set forth in the Base Indenture and the form of 2024 Notes, each Guarantor, hereby jointly and severally, fully, unconditionally and irrevocably guarantees the 2024 Notes and obligations of the Company hereunder and thereunder, and guarantees to each Holder of a Note authenticated and delivered by the Authentication Agent, and to the Trustee on behalf of such Holder, that (i) the principal of (and premium, if any) and interest on the 2024 Notes will be paid in full when due, whether at the Maturity Date, by acceleration or otherwise (including, without limitation, the amount that would become due but for the operation of any automatic stay provision of any Bankruptcy Law), together with interest on the overdue principal, if any, and all other obligations of the Company to the Holders or the Trustee hereunder or thereunder will be paid in full or performed, all in accordance with the terms hereof and thereof; and (ii) in case of any extension of time of payment or renewal of any 2024 Notes or of any such other obligations, the same will be paid in full when due or performed in accordance with the terms of the extension or renewal, whether at the Maturity Date, by acceleration or otherwise, subject, however, in the case of clauses (i) and (ii) above, to the limitations set forth in Section 9.03 of the Base Indenture.

SECTION 2.03.          Interest.

The 2024 Notes shall bear interest at a rate equal to 2.789% per annum. The 2024 Notes will bear interest from the date of the initial issuance of such 2024 Notes or from the most recent interest payment date to which interest has been paid or provided for, payable semi-annually in arrear on March 6 and September 6 of each year (each, an “Interest Payment Date”), commencing on March 6, 2020 until the Maturity Date, unless previously purchased or redeemed by the Company, to the person in whose name any Note is registered at the close of business on the 15th calendar day preceding each Interest Payment Date, whether or not such day is a Business Day (each, a “Record Date”) notwithstanding any transfer or exchange of such 2024 Notes subsequent to the Record Date and prior to such Interest Payment Date, except that, if and to the extent the Company shall default in the payment of the interest due on such Interest Payment Date, and the applicable grace period shall have expired, such defaulted interest may at the option of the Company be paid to the persons in whose names the outstanding 2024 Notes are registered at the close of business on a subsequent Record Date (which shall not be less than five Business Days prior to the date of payment of such defaulted interest) established by notice sent by or on behalf of the Company to the Holders (which term means registered holders) of the 2024 Notes, not less than 15 days preceding such subsequent Record Date. Interest will be computed on the basis of a 360-day year consisting of twelve 30-day months, or in the case of an
3

incomplete month, the number of days elapsed. If the date on which any interest payment or principal payment is to be made is not a Business Day, such payment will be made on the next day which is a Business Day, without any further interest or other amounts being paid or payable in connection therewith.

SECTION 2.04.          Place of Payment.

The place or places where the principal of, and premium, if any, and interest, if any, and Additional Amounts, if any, on the 2024 Notes shall be payable, the place or places where any 2024 Notes may be surrendered for registration, transfer or exchange and the place or places where notices and demands to or upon the Company in respect of the 2024 Notes may be served are as set forth in the Base Indenture.

SECTION 2.05.          Optional Redemption.

The Company may redeem the 2024 Notes, in whole or in part, at the Company’s option, at any time and from time to time before the Par Call Date (as defined below), at a redemption price equal to the greater of (x) 100% of the principal amount of the 2024 Notes to be redeemed and (y) as determined by the Independent Investment Banker (as defined below), the sum of the present values of the applicable Remaining Scheduled Payments (as defined below) discounted to the date of redemption (the “Redemption Date”) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months or, in the case of an incomplete month, the number of days elapsed) at the Treasury Rate (as defined below) plus 25 basis points, together with accrued and unpaid interest on the principal amount of the 2024 Notes to be redeemed to, but excluding, the Redemption Date.

If the Company elects to redeem the 2024 Notes on or after the Par Call Date, the Company will pay an amount equal to 100% of the principal amount of the 2024 Notes redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

In connection with such optional redemption the following defined terms apply:


Comparable Treasury Issue means the United States Treasury security selected by the Independent Investment Banker that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to, the remaining term of the 2024 Notes to the Par Call Date.


Comparable Treasury Price means, with respect to any Redemption Date, (A) the average of the Reference Treasury Dealer Quotations for that Redemption Date, after excluding the highest and lowest of such Reference Treasury Dealer Quotations or (B) if the Independent Investment Banker for the 2024 Notes obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such Quotations.

4


Independent Investment Banker means one of the Reference Treasury Dealers (as defined below) appointed by the Company to act as the “Independent Investment Banker”.


Par Call Date means August 6, 2024 (one month prior to the Maturity Date of the 2024 Notes.


Reference Treasury Dealer means each of BofA Securities, Inc., Barclays Capital Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and HSBC Securities (USA) Inc. and their respective successors and two other nationally recognized investment banking firms that are Primary Treasury Dealers specified from time to time by the Company; provided, however, that if any of the foregoing shall cease to be a primary U.S. Government securities dealer in New York City (a “Primary Treasury Dealer”), the Company shall substitute therefor another nationally recognized investment banking firm that is a Primary Treasury Dealer.


Reference Treasury Dealer Quotation means, with respect to each Reference Treasury Dealer and any Redemption Date, the average, as determined by the Independent Investment Banker, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Independent Investment Banker by such Reference Treasury Dealer at 3:30 p.m., New York City time, on the third Business Day immediately preceding that Redemption Date.


Remaining Scheduled Payments means, with respect to each 2024 Note to be redeemed, the remaining scheduled payments of the principal thereof and interest thereon that would be due from and including the related Redemption Date, but for such redemption, to but excluding the Par Call Date; provided, however, that if that Redemption Date is not an Interest Payment Date with respect to such 2024 Notes, the amount of the next succeeding scheduled interest payment thereon will be reduced by the amount of interest accrued thereon to that Redemption Date.


Treasury Rate means, with respect to any Redemption Date, the rate per annum equal to the semi-annual equivalent yield to maturity (computed as of the third Business Day immediately preceding that Redemption Date) of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for that Redemption Date.

Notice of any optional redemption will be given in accordance with the Base Indenture at least 10 days but not more than 30 days before the Redemption Date to each Holder of the 2024 Notes to be redeemed.

If less than all the 2024 Notes are to be redeemed pursuant to this Section 2.05, in the case of a redemption at the Company’s option, the 2024 Notes to be redeemed shall be selected in accordance with applicable procedures of DTC.

5

SECTION 2.06.          Redemption for Tax Reasons.

The ability of the Company to redeem the 2024 Notes due to a Change in Tax Law is as set forth in the Base Indenture.

SECTION 2.07.          Additional Amounts.

The applicability of payments of Additional Amounts under the 2024 Notes is as set forth in the Base Indenture. The Company is not required to pay Additional Amounts, except to the extent described in Section 4.10 of the Base Indenture.

ARTICLE III

Miscellaneous Provisions

SECTION 3.01.          Effectiveness. This Supplemental Indenture will become effective upon its execution and delivery.

SECTION 3.02.          Original Issue. The 2024 Notes may, upon execution of this Supplemental Indenture, be executed by the Company and delivered by the Company to the Trustee, as Authentication Agent, for authentication, and the Authentication Agent shall, upon Company order, authenticate and deliver such 2024 Notes as in such Company order provided.

SECTION 3.03.          Ratification and Integral Part. The Base Indenture, as supplemented by this Supplemental Indenture, is in all respects ratified and confirmed, and this Supplemental Indenture will be deemed an integral part of the Indenture in the manner and to the extent herein and therein provided.

SECTION 3.04.          Priority. This Supplemental Indenture shall be deemed part of the Base Indenture in the manner and to the extent herein and therein provided. The provisions of this Supplemental Indenture shall, subject to the terms hereof, supersede the provisions of the Base Indenture with respect to the 2024 Notes to the extent the Base Indenture is inconsistent herewith.

SECTION 3.05.          Successors and Assigns. All covenants and agreements in the Indenture, as supplemented and amended by this Supplemental Indenture, by the Company and the Guarantors will bind their respective successors and assigns, whether so expressed or not.

SECTION 3.06.          NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW OR ANY SUCCESSOR TO SUCH STATUTE) WILL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

6

SECTION 3.07.          Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

SECTION 3.08.          The Trustee. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which are made solely by the Company and the Guarantors.

[Remainder of page intentionally left blank.]


7


IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed and attested, all as of the date first above written.

  B.A.T CAPITAL CORPORATION
 
       

By:
/s/ Neil Wadey
 
    Name:  Neil Wadey  
    Title:    Director  
       


  BRITISH AMERICAN TOBACCO P.L.C.  
       

By:
/s/ Tadeu Marroco  
    Name:  Tadeu Marroco
 
    Title:    Director  
       


 
B.A.T. NETHERLANDS FINANCE B.V.
 
       

By:
/s/ M. Wiechers
 
    Name:  M. Wiechers  
    Title:    Director
 
       
  By:
/s/ JEP Bollen
 
    Name:  JEP Bollen  
    Title:    Director
 


  B.A.T. INTERNATIONAL FINANCE P.L.C.  
       

By:
/s/ Neil Wadey  
    Name:  Neil Wadey  
    Title:    Director
 
       


 
REYNOLDS AMERICAN INC.
 
       

By:
/s/ John R. Whitener
 
    Name:  John R. Whitener  
    Title:    SVP Controller - Finance & Accounting
 
                 and Treasurer
 
 


[Signature Page to Supplemental Indenture No. 1]


 
CITIBANK, N.A.,
as Trustee
 
       

By:
/s/ Cirino Emanuele
 
    Name:  Cirino Emanuele  
    Title:    Senior Trust Officer
 
 


[Signature Page to Supplemental Indenture No. 1]

EXHIBIT A

CUSIP No. 05526D BG9

B.A.T CAPITAL CORPORATION

No.
$
         
2.789% NOTE DUE 2024

B.A.T Capital Corporation, a corporation incorporated in the state of Delaware (the “Company”), for value received, promises to pay to CEDE & CO. or registered assigns the principal sum of $                  , on September 6, 2024.

Interest Payment Dates: March 6 and September 6, commencing on March 6, 2020.

Record Dates: at the close of business on the 15th calendar day that precedes the related Interest Payment Date, whether or not such day is a Business Day.

Reference is made to the further provisions of this 2024 Note contained herein, which will for all purposes have the same effect as if set forth at this place.

IN WITNESS WHEREOF, the Company has caused this 2024 Note to be signed manually or by facsimile by one of its duly authorized officers.

  B.A.T CAPITAL CORPORATION
 
       

By:
 
 
    Name:  
    Title:  
 

1

Certificate of Authentication

This is one of the 2.789% Notes due 2024 referred to in the within-mentioned Supplemental Indenture.

 
CITIBANK, N.A.,

as Authentication Agent
 
       

By:
 
 
    Authorized Signatory  
   
 
 


Dated:

2


B.A.T CAPITAL CORPORATION

2.789% NOTE DUE 2024

(1)          Interest. B.A.T Capital Corporation, a corporation incorporated in the state of Delaware, as issuer (the “Company”), promises to pay, until the principal hereof is paid or made available for payment, interest on the principal amount set forth on the face hereof at a rate of 2.789% per annum. Interest on the 2.789% Notes due 2024 (the “2024 Notes”) will accrue from and including the most recent date to which interest has been paid or, if no interest has been paid, from and including September 6, 2019, to but excluding the date on which interest is paid. Interest shall be payable in arrears on each March 6 and September 6, commencing on March 6, 2020. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months or, in the case of an incomplete month, the number of days elapsed. The Company shall pay interest on overdue principal (to the full extent permitted by law) at the rate borne by the 2024 Notes.

(2)          Method of Payment. The Company will pay interest to those persons who were Holders of record at the close of business on the 15th calendar day that precedes each Interest Payment Date, whether or not such day is a Business Day. Interest on the 2024 Notes will accrue from the date of original issuance or, if interest has already been paid, from the date it was most recently paid.  If the date on which any interest payment or principal payment is to be made is not a Business Day, such payment will be made on the next day which is a Business Day, without any further interest or other amounts being paid or payable in connection therewith.

(3)          Paying Agent, Transfer Agent and Registrar. Initially, Citibank, N.A. (the “Agent”) will act as a Paying Agent, Transfer Agent and Registrar. The Company may change any Paying Agent, Transfer Agent or Registrar without notice to the Holders. The Company or any of its subsidiaries may act as Paying Agent, Transfer Agent or Registrar.

(4)          Indenture. The Company issued the 2024 Notes under an indenture dated as of September 6, 2019 (the “Indenture”) and a supplemental indenture dated as of September 6, 2019 (the “Supplemental Indenture No. 1”), in each case among the Company, the Guarantors, the Trustee and the Agent. This is one of an issue of Notes of the Company issued, or to be issued, under the Indenture. The terms of the 2024 Notes include those stated in the Indenture and the Supplemental Indenture No. 1. The 2024 Notes are subject to all such terms, and Holders are referred to the Indenture and the Supplemental Indenture No. 1 for a statement of them. Capitalized and certain other terms used and not otherwise defined herein have the meanings set forth in the Indenture or the Supplemental Indenture No. 1 (as applicable).

(5)          Optional Redemption. At any time and from time to time before the applicable Par Call Date, the Company may redeem the 2024 Notes, in whole or in part, at the Company’s option, upon not less than 10 nor more than 30 days’ prior notice, at a price equal to the greater of:

(1)          100% of the aggregate principal amount of any 2024 Notes being redeemed, and
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(2)          as determined by the Independent Investment Banker, the sum of the present values of the Remaining Scheduled Payments discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months or, in the case of an incomplete month, the number of days elapsed) at the Treasury Rate, plus 25 basis points,

together with, in each case, accrued and unpaid interest on the principal amount of the 2024 Notes to be redeemed to, but excluding, the Redemption Date.

On or after the Par Call Date of the 2024 Notes, the 2024 Notes will be redeemable in whole at any time or in part, from time to time, at the Company’s option, upon at least 10 days’ but no more than 30 days’ prior notice, at a price equal to 100% of the principal amount of the 2024 Notes to be redeemed plus accrued and unpaid interest thereon to, but excluding, the Redemption Date.

The 2024 Notes are also redeemable by the Company, in whole but not in part, at 100% of the principal amount of the 2024 Notes plus accrued and unpaid interest to the applicable Redemption Date (including any Additional Amounts) at the Company’s option at any time prior to their maturity if, due to a Change in Tax Law: (i) the Company or any Guarantor, in accordance with the Supplemental Indenture No. 1, has, or would, become obligated to pay any Additional Amounts to the Holders of the 2024 Notes; (ii) in the case of any Guarantor, (A) the Parent would be unable, for reasons outside its control, to procure payment by the Company or any other Guarantor or (B) the procuring of such payment by the Company and each such other Guarantor would be subject to withholding taxes imposed by a Relevant Taxing Jurisdiction; and (iii) such obligation cannot otherwise be avoided by such Guarantor, the Parent or the Company, taking reasonable measures available to it.

(6)          Redemption Procedures. If the Company elects to redeem less than all of the 2024 Notes at any time, in the case the 2024 Notes are issued in definitive form, the 2024 Notes to be redeemed shall be selected in accordance with applicable procedures of the Depositary.

(7)          Notice of Redemption. Notices of redemption shall be transmitted at least 10 but not more than 30 days before the Redemption Date to each Holder of 2024 Notes to be redeemed in accordance with Section 10.01 of the Indenture. If the 2024 Notes are to be redeemed in part only, the notice of redemption that relates to such 2024 Notes will state the portion of the principal amount thereof that is to be redeemed.

(8)          Denominations, Transfer, Exchange. The 2024 Notes shall be issuable only in fully registered form without coupons in denominations of $2,000 and any integral multiple of $1,000 in excess thereof. A Holder may transfer or exchange 2024 Notes in accordance with the Indenture.

(9)          Persons Deemed Owners. The Depositary may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of the 2024 Global Notes for all purposes whatsoever.

(10)          Unclaimed Money. If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent will pay the money back to the Company
4

at its request or, if such money is then held by the Company in trust, such money shall be released from such trust. After that, Holders entitled to the money must look only to the Company for payment as general creditors unless applicable abandoned property law designates another Person.

(11)          Amendment, Supplement, Waiver, Etc. The Company, the Guarantors and the Trustee may modify or amend the Indenture, the 2024 Notes or the Guarantees without the consent of any Holder to, among other things, cure any ambiguity, or to correct or supplement any provision contained in the Indenture, the 2024 Notes or the Guarantees and add to the covenants, or the restrictions, conditions or provisions applicable to, the Company and Guarantors, as the case may be, such further covenants, restrictions, conditions or provisions as the Company and any Guarantor, as the case may be, shall consider to be for the protection of the Holders of the applicable 2024 Notes issued pursuant to the Indenture. Other amendments and modifications of the Indenture or the 2024 Notes may be made by the Company and the Trustee with the consent of the Holders of a majority of the aggregate principal amount of the outstanding 2024 Notes, subject to certain exceptions requiring the consent of each of the Holders of the 2024 Notes to be affected.

(12)          Defaults and Remedies. Events of Default are set forth in the Indenture. Subject to certain limitations in the Indenture, if an Event of Default with respect to the 2024 Notes (other than an Event of Default specified in Section 5.01 (vii), (viii) or (ix) of the Indenture with respect to the Company or any Guarantor), shall have occurred and be continuing, unless the principal of all the 2024 Notes shall have already become due and payable, the Holders of not less than 25% in aggregate principal amount of the 2024 Notes then outstanding, by notice in writing to the Company, each Guarantor and the Trustee, may declare the entire principal amount of all 2024 Notes and interest accrued and unpaid thereon, if any, to be due and payable immediately, and upon any such declaration the same shall become immediately due and payable, without any further declaration or other act on the part of any Holder. If certain Events of Default specified in Section 5.01 (vii), (viii) or (ix) of the Indenture occur with respect to the Company and are continuing, the principal amount of and accrued and unpaid interest on all the 2024 Notes issued pursuant to this Indenture shall become immediately due and payable, without any declaration or other act on the part of the Trustee or any Holder. The Trustee shall be under no obligation to exercise any of its rights or powers under the Indenture at the request or direction of any of the Holders, unless such Holders have offered to the Trustee security or indemnity satisfactory to the Trustee. Except in the case of a Default or Event of Default in payment of the principal of, premium, if any, or interest on any Note (including payments pursuant to a redemption or repurchase of the 2024 Notes pursuant to the provisions of the Indenture), the Trustee may withhold the notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of Holders.

(13)          Trustee Dealings with Company. The Trustee in its individual or any other capacity may become the owner or pledgee of 2024 Notes and may make loans to, accept deposits from, perform services for or otherwise deal with the Company or any Affiliate thereof with the same rights it would have if it were not Trustee.

(14)          No Recourse Against Others. No director, officer, employee or stockholder of the Company or any of the Guarantors, past, present or future, will have any liability for any of the
5

Company’s or such Guarantor’s obligations under the 2024 Notes or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of 2024 Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the 2024 Notes.

(15)          Discharge. The Company’s obligations pursuant to the Indenture will be discharged, except for obligations pursuant to certain sections thereof, subject to the terms of the Indenture, upon the payment or cancellation of all the 2024 Notes or upon the irrevocable deposit with the Trustee of United States dollars or U.S. Government Obligations sufficient to pay when due principal of and interest on the 2024 Notes at maturity or redemption, as the case may be.

(16)          Guarantees. The Company’s obligations under the 2024 Notes are jointly and severally, fully and unconditionally guaranteed, to the extent set forth in the Indenture, by each of the Guarantors.

(17)          Authentication. This Note shall not be valid until the Authentication Agent manually signs the certificate of authentication on this Note.

(18)          Governing Law. THE INTERNAL LAW OF THE STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW OR ANY SUCCESSOR TO SUCH STATUTE) WILL GOVERN AND BE USED TO CONSTRUE THIS 2024 NOTE WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

(19)          Abbreviations. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TENANT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

The Company will furnish to any Holder upon written request and without charge a copy of the Indenture. Requests may be made to:

B.A.T Capital Corporation
c/o British American Tobacco p.l.c.
Globe House
4 Temple Place
London WC2R 2PG
United Kingdom
Facsimile: +44 (0)20 7845 0555
Attention: Company Secretary

With a copy (which shall not constitute notice) to:

Cravath, Swaine & Moore LLP
CityPoint, 1 Ropemaker St.
London EC2Y 9HR
United Kingdom
Facsimile: +44 20 7860 1150
Attention: Alyssa K. Caples

6


ASSIGNMENT

I or we assign and transfer this 2024 Note to:



(Insert assignee’s social security or tax I.D. number)



(Print or type name, address and zip code of assignee)


and irrevocably appoint:


as Transfer Agent to transfer this 2024 Note on the books of the Company. The Transfer Agent may substitute another to act for him.

Date:
   
Your Signature:  
   
 
   
(Sign exactly as your name appears on the face of this Note)

Signature Guarantee:          
                           
 
SIGNATURE GUARANTEE

Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

7


SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE

The following increases or decreases in this Global Note have been made:

 
Date of
Exchange
 
 
Amount of
decrease in
Principal
Amount of this
Global Note
 
 
Amount of
increase in
Principal
Amount of this
Global Note
 
 
Principal
Amount of this
Global Note
following such
decrease or increase
 
 
Signature of
authorized
signatory of
Trustee or
Notes
Custodian
 


8


Exhibit 4.3


SUPPLEMENTAL INDENTURE NO. 2 (this “Supplemental Indenture”), dated as of September 6, 2019, among B.A.T Capital Corporation, a corporation incorporated in the state of Delaware (the “Company”), as issuer, British American Tobacco p.l.c., a public limited company incorporated under the laws of England and Wales (the “Parent”), B.A.T. International Finance p.l.c., a public limited company incorporated under the laws of England and Wales (“BATIF”), B.A.T. Netherlands Finance B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of The Netherlands (“BATNF”), and, until its guarantee is released in accordance with the Base Indenture (if ever), Reynolds American Inc., a North Carolina corporation (“RAI”), as guarantors (the “Guarantors”) and Citibank, N.A., as trustee (the “Trustee”).

W I T N E S S E T H

WHEREAS, the Company has heretofore executed and delivered to the Trustee an indenture dated as of September 6, 2019 (the “Base Indenture”), providing for the issuance from time to time of an unlimited aggregate principal amount of guaranteed debt securities;

WHEREAS, Section 7.01(g) of the Base Indenture provides that without the consent of any Holder, the Company, the Guarantors and the Trustee may amend or supplement the Indenture in order to, among other things, issue an unlimited aggregate principal amount of notes under the Base Indenture;

WHEREAS, pursuant to Section 7.01(g) of the Base Indenture, the parties hereto are authorized to execute and deliver this Supplemental Indenture;

WHEREAS, the Company and the Guarantors have taken all necessary corporate action to authorize the execution and delivery of this Supplemental Indenture;

WHEREAS, as contemplated by Section 2.01 of the Base Indenture, the Company intends to issue, and the Guarantors intend to guarantee, a new series of guaranteed debt securities to be known as the Company’s “3.215% Notes due 2026” under the Base Indenture.

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto mutually covenant and agree for the equal and ratable benefit of the Holders of the 2026 Notes (as defined below) as follows:


ARTICLE I

Definitions and Other Provisions of General Application

SECTION 1.01.          Definitions.

Except as otherwise expressly provided in this Supplemental Indenture, all terms used in this Supplemental Indenture which are defined in the Base Indenture shall have the meanings ascribed to them by the Base Indenture.



SECTION 1.02.          Effect of Headings.

The Article and Section headings herein are for convenience only and shall not affect the construction hereof.

SECTION 1.03.          Separability Clause.

In case any provision in this Supplemental Indenture shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

SECTION 1.04.          Benefits of Instrument.

Nothing in this Supplemental Indenture expressed and nothing that may be implied from any of the provisions hereof is intended, or shall be construed, to confer upon, or to give to, any Person other than the parties hereto and their successors and the Holders of the 2026 Notes any benefit or any right, remedy or claim under or by reason of this Supplemental Indenture or any covenant, condition, stipulation, promise or agreement hereof, and all covenants, conditions, stipulations, promises and agreements in this Supplemental Indenture contained shall be for the sole and exclusive benefit of the parties hereto and their successors and of the Holders of the 2026 Notes.


ARTICLE II

3.215% Notes due 2026

SECTION 2.01.          Creation of Series.

There is hereby established a new series of Notes under the Base Indenture entitled “3.215% Notes due 2026” (the “2026 Notes”). The form of the 2026 Notes, including the form of the certificate of authentication, is attached hereto as Exhibit A.

The Company shall issue the 2026 Notes in an aggregate principal amount of $1,000,000,000. The Company may from time to time, without the consent of the Holders of the 2026 Notes, “reopen” the series of 2026 Notes and create and issue additional Notes having substantially identical terms and conditions as the 2026 Notes (or in all respects except as to issue price, denomination, rate of interest, maturity date and the date from which interest, if any, shall accrue, and except as may otherwise be provided in or pursuant to such Officer’s Certificate or supplemental indenture relating thereto) so that the additional Notes are consolidated and form a single series with the outstanding 2026 Notes.

The 2026 Notes shall be initially be represented by one or more 2026 Notes of the same series in registered, global form without interest coupons. The global notes representing the 2026 Notes (collectively, the “2026 Global Notes”) initially shall be (i) be registered in the name of the Depository Trust Company (the “Depositary”) or the nominee of such Depositary, in each case for credit to an account of a member of, or direct or indirect participant in, the Depositary; and (ii) be delivered to Citibank, N.A. as custodian for such Depositary.

2


(a)          The maturity date of the principal of the 2026 Notes shall be September 6, 2026 (the “Maturity Date”).

(b)          The outstanding principal amount of the 2026 Notes shall accrue interest at a rate equal to 3.215% per annum, as provided in Section 2.03.

(c)          Unless supplemented or superseded in this Supplemental Indenture, the terms of the 2026 Notes, including any Events of Default and covenants of the Company and the Guarantors are consistent with the Base Indenture and set forth therein.

SECTION 2.02.          Guarantee.

Subject to the terms and applicable limitations set forth in the Base Indenture and the form of 2026 Notes, each Guarantor, hereby jointly and severally, fully, unconditionally and irrevocably guarantees the 2026 Notes and obligations of the Company hereunder and thereunder, and guarantees to each Holder of a Note authenticated and delivered by the Authentication Agent, and to the Trustee on behalf of such Holder, that (i) the principal of (and premium, if any) and interest on the 2026 Notes will be paid in full when due, whether at the Maturity Date, by acceleration or otherwise (including, without limitation, the amount that would become due but for the operation of any automatic stay provision of any Bankruptcy Law), together with interest on the overdue principal, if any, and all other obligations of the Company to the Holders or the Trustee hereunder or thereunder will be paid in full or performed, all in accordance with the terms hereof and thereof; and (ii) in case of any extension of time of payment or renewal of any 2026 Notes or of any such other obligations, the same will be paid in full when due or performed in accordance with the terms of the extension or renewal, whether at the Maturity Date, by acceleration or otherwise, subject, however, in the case of clauses (i) and (ii) above, to the limitations set forth in Section 9.03 of the Base Indenture.

SECTION 2.03.          Interest.

The 2026 Notes shall bear interest at a rate equal to 3.215% per annum. The 2026 Notes will bear interest from the date of the initial issuance of such 2026 Notes or from the most recent interest payment date to which interest has been paid or provided for, payable semi-annually in arrear on March 6 and September 6 of each year (each, an “Interest Payment Date”), commencing on March 6, 2020 until the Maturity Date, unless previously purchased or redeemed by the Company, to the person in whose name any Note is registered at the close of business on the 15th calendar day preceding each Interest Payment Date, whether or not such day is a Business Day (each, a “Record Date”) notwithstanding any transfer or exchange of such 2026 Notes subsequent to the Record Date and prior to such Interest Payment Date, except that, if and to the extent the Company shall default in the payment of the interest due on such Interest Payment Date, and the applicable grace period shall have expired, such defaulted interest may at the option of the Company be paid to the persons in whose names the outstanding 2026 Notes are registered at the close of business on a subsequent Record Date (which shall not be less than five Business Days prior to the date of payment of such defaulted interest) established by notice sent by or on behalf of the Company to the Holders (which term means registered holders) of the 2026 Notes, not less than 15 days preceding such subsequent Record Date. Interest will be computed on the basis of a 360-day year consisting of twelve 30-day months, or in the case of an incomplete month, the number of days elapsed. If the date on which any interest payment or principal payment is to be made is not a Business Day, such payment will be made on the next day which is a Business Day, without any further interest or other amounts being paid or payable in connection therewith.

3


SECTION 2.04.          Place of Payment.

The place or places where the principal of, and premium, if any, and interest, if any, and Additional Amounts, if any, on the 2026 Notes shall be payable, the place or places where any 2026 Notes may be surrendered for registration, transfer or exchange and the place or places where notices and demands to or upon the Company in respect of the 2026 Notes may be served are as set forth in the Base Indenture.

SECTION 2.05.          Optional Redemption.

The Company may redeem the 2026 Notes, in whole or in part, at the Company’s option, at any time and from time to time before the Par Call Date (as defined below), at a redemption price equal to the greater of (x) 100% of the principal amount of the 2026 Notes to be redeemed and (y) as determined by the Independent Investment Banker (as defined below), the sum of the present values of the applicable Remaining Scheduled Payments (as defined below) discounted to the date of redemption (the “Redemption Date”) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months or, in the case of an incomplete month, the number of days elapsed) at the Treasury Rate (as defined below) plus 30 basis points, together with accrued and unpaid interest on the principal amount of the 2026 Notes to be redeemed to, but excluding, the Redemption Date.

If the Company elects to redeem the 2026 Notes on or after the Par Call Date, the Company will pay an amount equal to 100% of the principal amount of the 2026 Notes redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

In connection with such optional redemption the following defined terms apply:


Comparable Treasury Issue means the United States Treasury security selected by the Independent Investment Banker that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to, the remaining term of the 2026 Notes to the Par Call Date.


Comparable Treasury Price means, with respect to any Redemption Date, (A) the average of the Reference Treasury Dealer Quotations for that Redemption Date, after excluding the highest and lowest of such Reference Treasury Dealer Quotations or (B) if the Independent Investment Banker for the 2026 Notes obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such Quotations.

4




Independent Investment Banker means one of the Reference Treasury Dealers (as defined below) appointed by the Company to act as the “Independent Investment Banker”.


Par Call Date means July 6, 2026 (two months prior to the Maturity Date of the 2026 Notes.


Reference Treasury Dealer means each of BofA Securities, Inc., Barclays Capital Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and HSBC Securities (USA) Inc. and their respective successors and two other nationally recognized investment banking firms that are Primary Treasury Dealers specified from time to time by the Company; provided, however, that if any of the foregoing shall cease to be a primary U.S. Government securities dealer in New York City (a “Primary Treasury Dealer”), the Company shall substitute therefor another nationally recognized investment banking firm that is a Primary Treasury Dealer.


Reference Treasury Dealer Quotation means, with respect to each Reference Treasury Dealer and any Redemption Date, the average, as determined by the Independent Investment Banker, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Independent Investment Banker by such Reference Treasury Dealer at 3:30 p.m., New York City time, on the third Business Day immediately preceding that Redemption Date.


Remaining Scheduled Payments means, with respect to each 2026 Note to be redeemed, the remaining scheduled payments of the principal thereof and interest thereon that would be due from and including the related Redemption Date, but for such redemption, to but excluding the Par Call Date; provided, however, that if that Redemption Date is not an Interest Payment Date with respect to such 2026 Notes, the amount of the next succeeding scheduled interest payment thereon will be reduced by the amount of interest accrued thereon to that Redemption Date.


Treasury Rate means, with respect to any Redemption Date, the rate per annum equal to the semi-annual equivalent yield to maturity (computed as of the third Business Day immediately preceding that Redemption Date) of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for that Redemption Date.

Notice of any optional redemption will be given in accordance with the Base Indenture at least 10 days but not more than 30 days before the Redemption Date to each Holder of the 2026 Notes to be redeemed.

If less than all the 2026 Notes are to be redeemed pursuant to this Section 2.05, in the case of a redemption at the Company’s option, the 2026 Notes to be redeemed shall be selected in accordance with applicable procedures of DTC.

5


SECTION 2.06.          Redemption for Tax Reasons.

The ability of the Company to redeem the 2026 Notes due to a Change in Tax Law is as set forth in the Base Indenture.

SECTION 2.07.          Additional Amounts.

The applicability of payments of Additional Amounts under the 2026 Notes is as set forth in the Base Indenture. The Company is not required to pay Additional Amounts, except to the extent described in Section 4.10 of the Base Indenture.


ARTICLE III

Miscellaneous Provisions

SECTION 3.01.          Effectiveness. This Supplemental Indenture will become effective upon its execution and delivery.

SECTION 3.02.          Original Issue. The 2026 Notes may, upon execution of this Supplemental Indenture, be executed by the Company and delivered by the Company to the Trustee, as Authentication Agent, for authentication, and the Authentication Agent shall, upon Company order, authenticate and deliver such 2026 Notes as in such Company order provided.

SECTION 3.03.          Ratification and Integral Part. The Base Indenture, as supplemented by this Supplemental Indenture, is in all respects ratified and confirmed, and this Supplemental Indenture will be deemed an integral part of the Indenture in the manner and to the extent herein and therein provided.

SECTION 3.04.          Priority. This Supplemental Indenture shall be deemed part of the Base Indenture in the manner and to the extent herein and therein provided. The provisions of this Supplemental Indenture shall, subject to the terms hereof, supersede the provisions of the Base Indenture with respect to the 2026 Notes to the extent the Base Indenture is inconsistent herewith.

SECTION 3.05.          Successors and Assigns. All covenants and agreements in the Indenture, as supplemented and amended by this Supplemental Indenture, by the Company and the Guarantors will bind their respective successors and assigns, whether so expressed or not.

SECTION 3.06.          NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW OR ANY SUCCESSOR TO SUCH STATUTE) WILL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

6



SECTION 3.07.          Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

SECTION 3.08.          The Trustee. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which are made solely by the Company and the Guarantors.

[Remainder of page intentionally left blank.]


7


IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed and attested, all as of the date first above written.

  B.A.T CAPITAL CORPORATION  
       

By:
/s/ Neil Wadey
 
    Name:   Neil Wadey  
    Title:     Director
 
       


  BRITISH AMERICAN TOBACCO P.L.C.  
       

By:
/s/ Tadeu Marroco
 
    Name:   Tadeu Marroco  
    Title:     Director 
 
       


  B.A.T. NETHERLANDS FINANCE B.V.
 
       

By:
/s/ M. Wiechers  
    Name:   M. Wiechers  
    Title:     Director  
       
  By:
/s/ JEP Bollen
 
    Name:   JEP Bollen
 
    Title:     Director  
       

  B.A.T. INTERNATIONAL FINANCE P.L.C.  
       

By:
/s/ Neil Wadey  
    Name:   Neil Wadey  
    Title:     Director
 
       

  REYNOLDS AMERICAN INC.  
       

By:
/s/ John R. Whitener
 
    Name:   John R. Whitener  
    Title:     SVP Controller - Finance & Accounting
 
                  and Treasurer
 




[Signature Page to Supplemental Indenture No. 2]



  CITIBANK, N.A.,
 
  as Trustee  
       

By:
/s/ Cirino Emanuele
 
    Name:   Cirino Emanuele  
    Title:     Senior Trust Officer
 
       

  

[Signature Page to Supplemental Indenture No. 2]




EXHIBIT A

CUSIP No. 05526D BJ3

B.A.T CAPITAL CORPORATION

 No.
 $
         

3.215% NOTE DUE 2026

B.A.T Capital Corporation, a corporation incorporated in the state of Delaware (the “Company”), for value received, promises to pay to CEDE & CO. or registered assigns the principal sum of $                               , on September 6, 2026.

Interest Payment Dates: March 6 and September 6, commencing on March 6, 2020.

Record Dates: at the close of business on the 15th calendar day that precedes the related Interest Payment Date, whether or not such day is a Business Day.

Reference is made to the further provisions of this 2026 Note contained herein, which will for all purposes have the same effect as if set forth at this place.

IN WITNESS WHEREOF, the Company has caused this 2026 Note to be signed manually or by facsimile by one of its duly authorized officers.

  B.A.T CAPITAL CORPORATION
 
       

By:

 
    Name:  
    Title:  
       



1



Certificate of Authentication

This is one of the 3.215% Notes due 2026 referred to in the within-mentioned Supplemental Indenture.

  CITIBANK, N.A.,  
     
  as Authentication Agent  
       

By:

 
    Authorized Signatory
 
       

Dated:

2



B.A.T CAPITAL CORPORATION

3.215% NOTE DUE 2026

(1)          Interest. B.A.T Capital Corporation, a corporation incorporated in the state of Delaware, as issuer (the “Company”), promises to pay, until the principal hereof is paid or made available for payment, interest on the principal amount set forth on the face hereof at a rate of 3.215% per annum. Interest on the 3.215% Notes due 2026 (the “2026 Notes”) will accrue from and including the most recent date to which interest has been paid or, if no interest has been paid, from and including September 6, 2019, to but excluding the date on which interest is paid. Interest shall be payable in arrears on each March 6 and September 6, commencing on March 6, 2020. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months or, in the case of an incomplete month, the number of days elapsed. The Company shall pay interest on overdue principal (to the full extent permitted by law) at the rate borne by the 2026 Notes.

(2)          Method of Payment. The Company will pay interest to those persons who were Holders of record at the close of business on the 15th calendar day that precedes each Interest Payment Date, whether or not such day is a Business Day. Interest on the 2026 Notes will accrue from the date of original issuance or, if interest has already been paid, from the date it was most recently paid.  If the date on which any interest payment or principal payment is to be made is not a Business Day, such payment will be made on the next day which is a Business Day, without any further interest or other amounts being paid or payable in connection therewith.

(3)          Paying Agent, Transfer Agent and Registrar. Initially, Citibank, N.A. (the “Agent”) will act as a Paying Agent, Transfer Agent and Registrar. The Company may change any Paying Agent, Transfer Agent or Registrar without notice to the Holders. The Company or any of its subsidiaries may act as Paying Agent, Transfer Agent or Registrar.

(4)          Indenture. The Company issued the 2026 Notes under an indenture dated as of September 6, 2019 (the “Indenture”) and a supplemental indenture dated as of September 6, 2019 (the “Supplemental Indenture No. 2”), in each case among the Company, the Guarantors, the Trustee and the Agent. This is one of an issue of Notes of the Company issued, or to be issued, under the Indenture. The terms of the 2026 Notes include those stated in the Indenture and the Supplemental Indenture No. 2. The 2026 Notes are subject to all such terms, and Holders are referred to the Indenture and the Supplemental Indenture No. 2 for a statement of them. Capitalized and certain other terms used and not otherwise defined herein have the meanings set forth in the Indenture or the Supplemental Indenture No. 2 (as applicable).

(5)          Optional Redemption. At any time and from time to time before the applicable Par Call Date, the Company may redeem the 2026 Notes, in whole or in part, at the Company’s option, upon not less than 10 nor more than 30 days’ prior notice, at a price equal to the greater of:

(1)          100% of the aggregate principal amount of any 2026 Notes being redeemed, and

3


(2)          as determined by the Independent Investment Banker, the sum of the present values of the Remaining Scheduled Payments discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months or, in the case of an incomplete month, the number of days elapsed) at the Treasury Rate, plus 30 basis points,

together with, in each case, accrued and unpaid interest on the principal amount of the 2026 Notes to be redeemed to, but excluding, the Redemption Date.

On or after the Par Call Date of the 2026 Notes, the 2026 Notes will be redeemable in whole at any time or in part, from time to time, at the Company’s option, upon at least 10 days’ but no more than 30 days’ prior notice, at a price equal to 100% of the principal amount of the 2026 Notes to be redeemed plus accrued and unpaid interest thereon to, but excluding, the Redemption Date.

The 2026 Notes are also redeemable by the Company, in whole but not in part, at 100% of the principal amount of the 2026 Notes plus accrued and unpaid interest to the applicable Redemption Date (including any Additional Amounts) at the Company’s option at any time prior to their maturity if, due to a Change in Tax Law: (i) the Company or any Guarantor, in accordance with the Supplemental Indenture No. 2, has, or would, become obligated to pay any Additional Amounts to the Holders of the 2026 Notes; (ii) in the case of any Guarantor, (A) the Parent would be unable, for reasons outside its control, to procure payment by the Company or any other Guarantor or (B) the procuring of such payment by the Company and each such other Guarantor would be subject to withholding taxes imposed by a Relevant Taxing Jurisdiction; and (iii) such obligation cannot otherwise be avoided by such Guarantor, the Parent or the Company, taking reasonable measures available to it.

(6)          Redemption Procedures. If the Company elects to redeem less than all of the 2026 Notes at any time, in the case the 2026 Notes are issued in definitive form, the 2026 Notes to be redeemed shall be selected in accordance with applicable procedures of the Depositary.

(7)          Notice of Redemption. Notices of redemption shall be transmitted at least 10 but not more than 30 days before the Redemption Date to each Holder of 2026 Notes to be redeemed in accordance with Section 10.01 of the Indenture. If the 2026 Notes are to be redeemed in part only, the notice of redemption that relates to such 2026 Notes will state the portion of the principal amount thereof that is to be redeemed.

(8)          Denominations, Transfer, Exchange. The 2026 Notes shall be issuable only in fully registered form without coupons in denominations of $2,000 and any integral multiple of $1,000 in excess thereof. A Holder may transfer or exchange 2026 Notes in accordance with the Indenture.

(9)          Persons Deemed Owners. The Depositary may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of the 2026 Global Notes for all purposes whatsoever.

(10)          Unclaimed Money. If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent will pay the money back to the Company at its request or, if such money is then held by the Company in trust, such money shall be released from such trust. After that, Holders entitled to the money must look only to the Company for payment as general creditors unless applicable abandoned property law designates another Person.

4


(11)          Amendment, Supplement, Waiver, Etc. The Company, the Guarantors and the Trustee may modify or amend the Indenture, the 2026 Notes or the Guarantees without the consent of any Holder to, among other things, cure any ambiguity, or to correct or supplement any provision contained in the Indenture, the 2026 Notes or the Guarantees and add to the covenants, or the restrictions, conditions or provisions applicable to, the Company and Guarantors, as the case may be, such further covenants, restrictions, conditions or provisions as the Company and any Guarantor, as the case may be, shall consider to be for the protection of the Holders of the applicable 2026 Notes issued pursuant to the Indenture. Other amendments and modifications of the Indenture or the 2026 Notes may be made by the Company and the Trustee with the consent of the Holders of a majority of the aggregate principal amount of the outstanding 2026 Notes, subject to certain exceptions requiring the consent of each of the Holders of the 2026 Notes to be affected.

(12)          Defaults and Remedies. Events of Default are set forth in the Indenture. Subject to certain limitations in the Indenture, if an Event of Default with respect to the 2026 Notes (other than an Event of Default specified in Section 5.01 (vii), (viii) or (ix) of the Indenture with respect to the Company or any Guarantor), shall have occurred and be continuing, unless the principal of all the 2026 Notes shall have already become due and payable, the Holders of not less than 25% in aggregate principal amount of the 2026 Notes then outstanding, by notice in writing to the Company, each Guarantor and the Trustee, may declare the entire principal amount of all 2026 Notes and interest accrued and unpaid thereon, if any, to be due and payable immediately, and upon any such declaration the same shall become immediately due and payable, without any further declaration or other act on the part of any Holder. If certain Events of Default specified in Section 5.01 (vii), (viii) or (ix) of the Indenture occur with respect to the Company and are continuing, the principal amount of and accrued and unpaid interest on all the 2026 Notes issued pursuant to this Indenture shall become immediately due and payable, without any declaration or other act on the part of the Trustee or any Holder. The Trustee shall be under no obligation to exercise any of its rights or powers under the Indenture at the request or direction of any of the Holders, unless such Holders have offered to the Trustee security or indemnity satisfactory to the Trustee. Except in the case of a Default or Event of Default in payment of the principal of, premium, if any, or interest on any Note (including payments pursuant to a redemption or repurchase of the 2026 Notes pursuant to the provisions of the Indenture), the Trustee may withhold the notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of Holders.

(13)          Trustee Dealings with Company. The Trustee in its individual or any other capacity may become the owner or pledgee of 2026 Notes and may make loans to, accept deposits from, perform services for or otherwise deal with the Company or any Affiliate thereof with the same rights it would have if it were not Trustee.

(14)          No Recourse Against Others. No director, officer, employee or stockholder of the Company or any of the Guarantors, past, present or future, will have any liability for any of the Company’s or such Guarantor’s obligations under the 2026 Notes or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of 2026 Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the 2026 Notes.

5


(15)          Discharge. The Company’s obligations pursuant to the Indenture will be discharged, except for obligations pursuant to certain sections thereof, subject to the terms of the Indenture, upon the payment or cancellation of all the 2026 Notes or upon the irrevocable deposit with the Trustee of United States dollars or U.S. Government Obligations sufficient to pay when due principal of and interest on the 2026 Notes at maturity or redemption, as the case may be.

(16)          Guarantees. The Company’s obligations under the 2026 Notes are jointly and severally, fully and unconditionally guaranteed, to the extent set forth in the Indenture, by each of the Guarantors.

(17)          Authentication. This Note shall not be valid until the Authentication Agent manually signs the certificate of authentication on this Note.

(18)          Governing Law. THE INTERNAL LAW OF THE STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW OR ANY SUCCESSOR TO SUCH STATUTE) WILL GOVERN AND BE USED TO CONSTRUE THIS 2026 NOTE WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

(19)          Abbreviations. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TENANT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

The Company will furnish to any Holder upon written request and without charge a copy of the Indenture. Requests may be made to:

B.A.T Capital Corporation
c/o British American Tobacco p.l.c.
Globe House
4 Temple Place
London WC2R 2PG
United Kingdom
Facsimile: +44 (0)20 7845 0555
Attention: Company Secretary

With a copy (which shall not constitute notice) to:

Cravath, Swaine & Moore LLP
CityPoint, 1 Ropemaker St.
London EC2Y 9HR
United Kingdom
Facsimile: +44 20 7860 1150
Attention: Alyssa K. Caples

6


ASSIGNMENT

I or we assign and transfer this 2026 Note to:


(Insert assignee’s social security or tax I.D. number)



(Print or type name, address and zip code of assignee)

and irrevocably appoint:

as Transfer Agent to transfer this 2026 Note on the books of the Company. The Transfer Agent may substitute another to act for him.

Date:
   
Your Signature:
   
       
(Sign exactly as your name appears on the face of this Note)


Signature Guarantee:
         


SIGNATURE GUARANTEE

Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

7


SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE

The following increases or decreases in this Global Note have been made:

Date of
Exchange
 Amount of
decrease in
Principal
Amount of this
Global Note
 Amount of
increase in
Principal
Amount of this
Global Note
 Principal
Amount of this
Global Note
following such
decrease or
increase
 Signature of
authorized
signatory of
Trustee or
Notes
Custodian



8
Exhibit 4.4


SUPPLEMENTAL INDENTURE NO. 3 (this “Supplemental Indenture”), dated as of September 6, 2019 among B.A.T Capital Corporation, a corporation incorporated in the state of Delaware (the “Company”), as issuer, British American Tobacco p.l.c., a public limited company incorporated under the laws of England and Wales (the “Parent”), B.A.T. International Finance p.l.c., a public limited company incorporated under the laws of England and Wales (“BATIF”), B.A.T. Netherlands Finance B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of The Netherlands (“BATNF”), and, until its guarantee is released in accordance with the Base Indenture (if ever), Reynolds American Inc., a North Carolina corporation (“RAI”), as guarantors (the “Guarantors”) and Citibank, N.A., as trustee (the “Trustee”).

W I T N E S S E T H

WHEREAS, the Company has heretofore executed and delivered to the Trustee an indenture dated as of September 6, 2019 (the “Base Indenture”), providing for the issuance from time to time of an unlimited aggregate principal amount of guaranteed debt securities;

WHEREAS, Section 7.01(g) of the Base Indenture provides that without the consent of any Holder, the Company, the Guarantors and the Trustee may amend or supplement the Indenture in order to, among other things, issue an unlimited aggregate principal amount of notes under the Base Indenture;

WHEREAS, pursuant to Section 7.01(g) of the Base Indenture, the parties hereto are authorized to execute and deliver this Supplemental Indenture;

WHEREAS, the Company and the Guarantors have taken all necessary corporate action to authorize the execution and delivery of this Supplemental Indenture;

WHEREAS, as contemplated by Section 2.01 of the Base Indenture, the Company intends to issue, and the Guarantors intend to guarantee, a new series of guaranteed debt securities to be known as the Company’s “3.462% Notes due 2029” under the Base Indenture.

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto mutually covenant and agree for the equal and ratable benefit of the Holders of the 2029 Notes (as defined below) as follows:


ARTICLE I

Definitions and Other Provisions of General Application

SECTION 1.01.          Definitions.

Except as otherwise expressly provided in this Supplemental Indenture, all terms used in this Supplemental Indenture which are defined in the Base Indenture shall have the meanings ascribed to them by the Base Indenture.



SECTION 1.02.          Effect of Headings.

The Article and Section headings herein are for convenience only and shall not affect the construction hereof.

SECTION 1.03.          Separability Clause.

In case any provision in this Supplemental Indenture shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

SECTION 1.04.          Benefits of Instrument.

Nothing in this Supplemental Indenture expressed and nothing that may be implied from any of the provisions hereof is intended, or shall be construed, to confer upon, or to give to, any Person other than the parties hereto and their successors and the Holders of the 2029 Notes any benefit or any right, remedy or claim under or by reason of this Supplemental Indenture or any covenant, condition, stipulation, promise or agreement hereof, and all covenants, conditions, stipulations, promises and agreements in this Supplemental Indenture contained shall be for the sole and exclusive benefit of the parties hereto and their successors and of the Holders of the 2029 Notes.


ARTICLE II

3.462% Notes due 2029

SECTION 2.01.          Creation of Series.

There is hereby established a new series of Notes under the Base Indenture entitled “3.462% Notes due 2029” (the “2029 Notes”). The form of the 2029 Notes, including the form of the certificate of authentication, is attached hereto as Exhibit A.

The Company shall issue the 2029 Notes in an aggregate principal amount of $500,000,000. The Company may from time to time, without the consent of the Holders of the 2029 Notes, “reopen” the series of 2029 Notes and create and issue additional Notes having substantially identical terms and conditions as the 2029 Notes (or in all respects except as to issue price, denomination, rate of interest, maturity date and the date from which interest, if any, shall accrue, and except as may otherwise be provided in or pursuant to such Officer’s Certificate or supplemental indenture relating thereto) so that the additional Notes are consolidated and form a single series with the outstanding 2029 Notes.

The 2029 Notes shall be initially be represented by one or more 2029 Notes of the same series in registered, global form without interest coupons. The global notes representing the 2029 Notes (collectively, the “2029 Global Notes”) initially shall be (i) be registered in the name of the Depository Trust Company (the “Depositary”) or the nominee of such Depositary, in each case for credit to an account of a member of, or direct or indirect participant in, the Depositary; and (ii) be delivered to Citibank, N.A. as custodian for such Depositary.

2


(a)          The maturity date of the principal of the 2029 Notes shall be September 6, 2029 (the “Maturity Date”).

(b)          The outstanding principal amount of the 2029 Notes shall accrue interest at a rate equal to 3.462% per annum, as provided in Section 2.03.

(c)          Unless supplemented or superseded in this Supplemental Indenture, the terms of the 2029 Notes, including any Events of Default and covenants of the Company and the Guarantors are consistent with the Base Indenture and set forth therein.

SECTION 2.02.          Guarantee.

Subject to the terms and applicable limitations set forth in the Base Indenture and the form of 2029 Notes, each Guarantor, hereby jointly and severally, fully, unconditionally and irrevocably guarantees the 2029 Notes and obligations of the Company hereunder and thereunder, and guarantees to each Holder of a Note authenticated and delivered by the Authentication Agent, and to the Trustee on behalf of such Holder, that (i) the principal of (and premium, if any) and interest on the 2029 Notes will be paid in full when due, whether at the Maturity Date, by acceleration or otherwise (including, without limitation, the amount that would become due but for the operation of any automatic stay provision of any Bankruptcy Law), together with interest on the overdue principal, if any, and all other obligations of the Company to the Holders or the Trustee hereunder or thereunder will be paid in full or performed, all in accordance with the terms hereof and thereof; and (ii) in case of any extension of time of payment or renewal of any 2029 Notes or of any such other obligations, the same will be paid in full when due or performed in accordance with the terms of the extension or renewal, whether at the Maturity Date, by acceleration or otherwise, subject, however, in the case of clauses (i) and (ii) above, to the limitations set forth in Section 9.03 of the Base Indenture.

SECTION 2.03.          Interest.

The 2029 Notes shall bear interest at a rate equal to 3.462% per annum. The 2029 Notes will bear interest from the date of the initial issuance of such 2029 Notes or from the most recent interest payment date to which interest has been paid or provided for, payable semi-annually in arrear on March 6 and September 6 of each year (each, an “Interest Payment Date”), commencing on March 6, 2020 until the Maturity Date, unless previously purchased or redeemed by the Company, to the person in whose name any Note is registered at the close of business on the 15th calendar day preceding each Interest Payment Date, whether or not such day is a Business Day (each, a “Record Date”) notwithstanding any transfer or exchange of such 2029 Notes subsequent to the Record Date and prior to such Interest Payment Date, except that, if and to the extent the Company shall default in the payment of the interest due on such Interest Payment Date, and the applicable grace period shall have expired, such defaulted interest may at the option of the Company be paid to the persons in whose names the outstanding 2029 Notes are registered at the close of business on a subsequent Record Date (which shall not be less than five Business Days prior to the date of payment of such defaulted interest) established by notice sent by or on behalf of the Company to the Holders (which term means registered holders) of the 2029 Notes, not less than 15 days preceding such subsequent Record Date. Interest will be computed on the basis of a 360-day year consisting of twelve 30-day months, or in the case of an
3


incomplete month, the number of days elapsed. If the date on which any interest payment or principal payment is to be made is not a Business Day, such payment will be made on the next day which is a Business Day, without any further interest or other amounts being paid or payable in connection therewith.

SECTION 2.04.          Place of Payment.

The place or places where the principal of, and premium, if any, and interest, if any, and Additional Amounts, if any, on the 2029 Notes shall be payable, the place or places where any 2029 Notes may be surrendered for registration, transfer or exchange and the place or places where notices and demands to or upon the Company in respect of the 2029 Notes may be served are as set forth in the Base Indenture.

SECTION 2.05.          Optional Redemption.

The Company may redeem the 2029 Notes, in whole or in part, at the Company’s option, at any time and from time to time before the Par Call Date (as defined below), at a redemption price equal to the greater of (x) 100% of the principal amount of the 2029 Notes to be redeemed and (y) as determined by the Independent Investment Banker (as defined below), the sum of the present values of the applicable Remaining Scheduled Payments (as defined below) discounted to the date of redemption (the “Redemption Date”) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months or, in the case of an incomplete month, the number of days elapsed) at the Treasury Rate (as defined below) plus 30 basis points, together with accrued and unpaid interest on the principal amount of the 2029 Notes to be redeemed to, but excluding, the Redemption Date.

If the Company elects to redeem the 2029 Notes on or after the Par Call Date, the Company will pay an amount equal to 100% of the principal amount of the 2029 Notes redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

In connection with such optional redemption the following defined terms apply:


Comparable Treasury Issue means the United States Treasury security selected by the Independent Investment Banker that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to, the remaining term of the 2029 Notes to the Par Call Date.


Comparable Treasury Price means, with respect to any Redemption Date, (A) the average of the Reference Treasury Dealer Quotations for that Redemption Date, after excluding the highest and lowest of such Reference Treasury Dealer Quotations or (B) if the Independent Investment Banker for the 2029 Notes obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such Quotations.

4



Independent Investment Banker means one of the Reference Treasury Dealers (as defined below) appointed by the Company to act as the “Independent Investment Banker”.


Par Call Date means June 6, 2029 (three months prior to the Maturity Date of the 2029 Notes.


Reference Treasury Dealer means each of BofA Securities, Inc., Barclays Capital Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and HSBC Securities (USA) Inc. and their respective successors and two other nationally recognized investment banking firms that are Primary Treasury Dealers specified from time to time by the Company; provided, however, that if any of the foregoing shall cease to be a primary U.S. Government securities dealer in New York City (a “Primary Treasury Dealer”), the Company shall substitute therefor another nationally recognized investment banking firm that is a Primary Treasury Dealer.


Reference Treasury Dealer Quotation means, with respect to each Reference Treasury Dealer and any Redemption Date, the average, as determined by the Independent Investment Banker, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Independent Investment Banker by such Reference Treasury Dealer at 3:30 p.m., New York City time, on the third Business Day immediately preceding that Redemption Date.


Remaining Scheduled Payments means, with respect to each 2029 Note to be redeemed, the remaining scheduled payments of the principal thereof and interest thereon that would be due from and including the related Redemption Date, but for such redemption, to but excluding the Par Call Date; provided, however, that if that Redemption Date is not an Interest Payment Date with respect to such 2029 Notes, the amount of the next succeeding scheduled interest payment thereon will be reduced by the amount of interest accrued thereon to that Redemption Date.


Treasury Rate means, with respect to any Redemption Date, the rate per annum equal to the semi-annual equivalent yield to maturity (computed as of the third Business Day immediately preceding that Redemption Date) of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for that Redemption Date.

Notice of any optional redemption will be given in accordance with the Base Indenture at least 10 days but not more than 30 days before the Redemption Date to each Holder of the 2029 Notes to be redeemed.

If less than all the 2029 Notes are to be redeemed pursuant to this Section 2.05, in the case of a redemption at the Company’s option, the 2029 Notes to be redeemed shall be selected in accordance with applicable procedures of DTC.

5


SECTION 2.06.          Redemption for Tax Reasons.

The ability of the Company to redeem the 2029 Notes due to a Change in Tax Law is as set forth in the Base Indenture.

SECTION 2.07.          Additional Amounts.

The applicability of payments of Additional Amounts under the 2029 Notes is as set forth in the Base Indenture. The Company is not required to pay Additional Amounts, except to the extent described in Section 4.10 of the Base Indenture.


ARTICLE III

Miscellaneous Provisions

SECTION 3.01.          Effectiveness. This Supplemental Indenture will become effective upon its execution and delivery.

SECTION 3.02.          Original Issue. The 2029 Notes may, upon execution of this Supplemental Indenture, be executed by the Company and delivered by the Company to the Trustee, as Authentication Agent, for authentication, and the Authentication Agent shall, upon Company order, authenticate and deliver such 2029 Notes as in such Company order provided.

SECTION 3.03.          Ratification and Integral Part. The Base Indenture, as supplemented by this Supplemental Indenture, is in all respects ratified and confirmed, and this Supplemental Indenture will be deemed an integral part of the Indenture in the manner and to the extent herein and therein provided.

SECTION 3.04.          Priority. This Supplemental Indenture shall be deemed part of the Base Indenture in the manner and to the extent herein and therein provided. The provisions of this Supplemental Indenture shall, subject to the terms hereof, supersede the provisions of the Base Indenture with respect to the 2029 Notes to the extent the Base Indenture is inconsistent herewith.

SECTION 3.05.          Successors and Assigns. All covenants and agreements in the Indenture, as supplemented and amended by this Supplemental Indenture, by the Company and the Guarantors will bind their respective successors and assigns, whether so expressed or not.

SECTION 3.06.          NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW OR ANY SUCCESSOR TO SUCH STATUTE) WILL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

6


SECTION 3.07.          Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

SECTION 3.08.          The Trustee. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which are made solely by the Company and the Guarantors.

[Remainder of page intentionally left blank.]


7


IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed and attested, all as of the date first above written.


  B.A.T CAPITAL CORPORATION  
       

By:
/s/ Neil Wadey
 
    Name:   Neil Wadey  
    Title:     Director
 
       


  BRITISH AMERICAN TOBACCO P.L.C.  
       

By:
/s/ Tadeu Marrocco
 
    Name:   Tadeu Marrocco  
    Title:     Director  
       


  B.A.T. NETHERLANDS FINANCE B.V.  
       

By:
/s/ M. Wiechers  
    Name:   M. Wiechers  
    Title:     Director  
       


By:
/s/ JEP Bollen
 
    Name:   JEP Bollen
 
    Title:     Director  
       

  B.A.T. INTERNATIONAL FINANCE P.L.C.  
       

By:
/s/ Neil Wadey  
    Name:   Neil Wadey  
    Title:     Director  
       


  REYNOLDS AMERICAN INC.  
       

By:
/s/ John R. Whitener
 
    Name:   John R. Whitener
 
    Title:     SVP Controller - Finance & Accounting
 
                 and Treasurer
 


[Signature Page to Supplemental Indenture No. 3]


  CITIBANK, N.A.,
as Trustee
 
       

By:
/s/ Cirino Emanuele
 
    Name:   Cirino Emanuele  
    Title:     Senior Trust Officer
 
       





[Signature Page to Supplemental Indenture No. 3]


EXHIBIT A

CUSIP No. 05526D BH7

B.A.T CAPITAL CORPORATION


No.
$

3.462% NOTE DUE 2029

B.A.T Capital Corporation, a corporation incorporated in the state of Delaware (the “Company”), for value received, promises to pay to CEDE & CO. or registered assigns the principal sum of $                  , on September 6, 2029.

Interest Payment Dates: March 6 and September 6, commencing on March 6, 2020.

Record Dates: at the close of business on the 15th calendar day that precedes the related Interest Payment Date, whether or not such day is a Business Day.

Reference is made to the further provisions of this 2029 Note contained herein, which will for all purposes have the same effect as if set forth at this place.

IN WITNESS WHEREOF, the Company has caused this 2029 Note to be signed manually or by facsimile by one of its duly authorized officers.

  B.A.T CAPITAL CORPORATION  
       
       

By:

 
    Name:  
    Title:  
       




1


Certificate of Authentication

This is one of the 3.462% Notes due 2029 referred to in the within-mentioned Supplemental Indenture.

 
CITIBANK, N.A.,

as Authentication Agent
 
       
       

By:

 
    Authorized Signatory  
   
 
       


Dated:

2


B.A.T CAPITAL CORPORATION

3.462% NOTE DUE 2029

(1)          Interest. B.A.T Capital Corporation, a corporation incorporated in the state of Delaware, as issuer (the “Company”), promises to pay, until the principal hereof is paid or made available for payment, interest on the principal amount set forth on the face hereof at a rate of 3.462% per annum. Interest on the 3.462% Notes due 2029 (the “2029 Notes”) will accrue from and including the most recent date to which interest has been paid or, if no interest has been paid, from and including September 6, 2019, to but excluding the date on which interest is paid. Interest shall be payable in arrears on each March 6 and September 6, commencing on March 6, 2020. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months or, in the case of an incomplete month, the number of days elapsed. The Company shall pay interest on overdue principal (to the full extent permitted by law) at the rate borne by the 2029 Notes.

(2)          Method of Payment. The Company will pay interest to those persons who were Holders of record at the close of business on the 15th calendar day that precedes each Interest Payment Date, whether or not such day is a Business Day. Interest on the 2029 Notes will accrue from the date of original issuance or, if interest has already been paid, from the date it was most recently paid.  If the date on which any interest payment or principal payment is to be made is not a Business Day, such payment will be made on the next day which is a Business Day, without any further interest or other amounts being paid or payable in connection therewith.

(3)          Paying Agent, Transfer Agent and Registrar. Initially, Citibank, N.A. (the “Agent”) will act as a Paying Agent, Transfer Agent and Registrar. The Company may change any Paying Agent, Transfer Agent or Registrar without notice to the Holders. The Company or any of its subsidiaries may act as Paying Agent, Transfer Agent or Registrar.

(4)          Indenture. The Company issued the 2029 Notes under an indenture dated as of September 6, 2019 (the “Indenture”) and a supplemental indenture dated as of September 6, 2019 (the “Supplemental Indenture No. 3”), in each case among the Company, the Guarantors, the Trustee and the Agent. This is one of an issue of Notes of the Company issued, or to be issued, under the Indenture. The terms of the 2029 Notes include those stated in the Indenture and the Supplemental Indenture No. 3. The 2029 Notes are subject to all such terms, and Holders are referred to the Indenture and the Supplemental Indenture No. 3 for a statement of them. Capitalized and certain other terms used and not otherwise defined herein have the meanings set forth in the Indenture or the Supplemental Indenture No. 3 (as applicable).

(5)          Optional Redemption. At any time and from time to time before the applicable Par Call Date, the Company may redeem the 2029 Notes, in whole or in part, at the Company’s option, upon not less than 10 nor more than 30 days’ prior notice, at a price equal to the greater of:

(1)          100% of the aggregate principal amount of any 2029 Notes being redeemed, and

3


(2)          as determined by the Independent Investment Banker, the sum of the present values of the Remaining Scheduled Payments discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months or, in the case of an incomplete month, the number of days elapsed) at the Treasury Rate, plus 30 basis points,

together with, in each case, accrued and unpaid interest on the principal amount of the 2029 Notes to be redeemed to, but excluding, the Redemption Date.

On or after the Par Call Date of the 2029 Notes, the 2029 Notes will be redeemable in whole at any time or in part, from time to time, at the Company’s option, upon at least 10 days’ but no more than 30 days’ prior notice, at a price equal to 100% of the principal amount of the 2029 Notes to be redeemed plus accrued and unpaid interest thereon to, but excluding, the Redemption Date.

The 2029 Notes are also redeemable by the Company, in whole but not in part, at 100% of the principal amount of the 2029 Notes plus accrued and unpaid interest to the applicable Redemption Date (including any Additional Amounts) at the Company’s option at any time prior to their maturity if, due to a Change in Tax Law: (i) the Company or any Guarantor, in accordance with the Supplemental Indenture No. 3, has, or would, become obligated to pay any Additional Amounts to the Holders of the 2029 Notes; (ii) in the case of any Guarantor, (A) the Parent would be unable, for reasons outside its control, to procure payment by the Company or any other Guarantor or (B) the procuring of such payment by the Company and each such other Guarantor would be subject to withholding taxes imposed by a Relevant Taxing Jurisdiction; and (iii) such obligation cannot otherwise be avoided by such Guarantor, the Parent or the Company, taking reasonable measures available to it.

(6)          Redemption Procedures. If the Company elects to redeem less than all of the 2029 Notes at any time, in the case the 2029 Notes are issued in definitive form, the 2029 Notes to be redeemed shall be selected in accordance with applicable procedures of the Depositary.

(7)          Notice of Redemption. Notices of redemption shall be transmitted at least 10 but not more than 30 days before the Redemption Date to each Holder of 2029 Notes to be redeemed in accordance with Section 10.01 of the Indenture. If the 2029 Notes are to be redeemed in part only, the notice of redemption that relates to such 2029 Notes will state the portion of the principal amount thereof that is to be redeemed.

(8)          Denominations, Transfer, Exchange. The 2029 Notes shall be issuable only in fully registered form without coupons in denominations of $2,000 and any integral multiple of $1,000 in excess thereof. A Holder may transfer or exchange 2029 Notes in accordance with the Indenture.

(9)          Persons Deemed Owners. The Depositary may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of the 2029 Global Notes for all purposes whatsoever.

(10)          Unclaimed Money. If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent will pay the money back to the Company
4


at its request or, if such money is then held by the Company in trust, such money shall be released from such trust. After that, Holders entitled to the money must look only to the Company for payment as general creditors unless applicable abandoned property law designates another Person.

(11)          Amendment, Supplement, Waiver, Etc. The Company, the Guarantors and the Trustee may modify or amend the Indenture, the 2029 Notes or the Guarantees without the consent of any Holder to, among other things, cure any ambiguity, or to correct or supplement any provision contained in the Indenture, the 2029 Notes or the Guarantees and add to the covenants, or the restrictions, conditions or provisions applicable to, the Company and Guarantors, as the case may be, such further covenants, restrictions, conditions or provisions as the Company and any Guarantor, as the case may be, shall consider to be for the protection of the Holders of the applicable 2029 Notes issued pursuant to the Indenture. Other amendments and modifications of the Indenture or the 2029 Notes may be made by the Company and the Trustee with the consent of the Holders of a majority of the aggregate principal amount of the outstanding 2029 Notes, subject to certain exceptions requiring the consent of each of the Holders of the 2029 Notes to be affected.

(12)          Defaults and Remedies. Events of Default are set forth in the Indenture. Subject to certain limitations in the Indenture, if an Event of Default with respect to the 2029 Notes (other than an Event of Default specified in Section 5.01 (vii), (viii) or (ix) of the Indenture with respect to the Company or any Guarantor), shall have occurred and be continuing, unless the principal of all the 2029 Notes shall have already become due and payable, the Holders of not less than 25% in aggregate principal amount of the 2029 Notes then outstanding, by notice in writing to the Company, each Guarantor and the Trustee, may declare the entire principal amount of all 2029 Notes and interest accrued and unpaid thereon, if any, to be due and payable immediately, and upon any such declaration the same shall become immediately due and payable, without any further declaration or other act on the part of any Holder. If certain Events of Default specified in Section 5.01 (vii), (viii) or (ix) of the Indenture occur with respect to the Company and are continuing, the principal amount of and accrued and unpaid interest on all the 2029 Notes issued pursuant to this Indenture shall become immediately due and payable, without any declaration or other act on the part of the Trustee or any Holder. The Trustee shall be under no obligation to exercise any of its rights or powers under the Indenture at the request or direction of any of the Holders, unless such Holders have offered to the Trustee security or indemnity satisfactory to the Trustee. Except in the case of a Default or Event of Default in payment of the principal of, premium, if any, or interest on any Note (including payments pursuant to a redemption or repurchase of the 2029 Notes pursuant to the provisions of the Indenture), the Trustee may withhold the notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of Holders.

(13)          Trustee Dealings with Company. The Trustee in its individual or any other capacity may become the owner or pledgee of 2029 Notes and may make loans to, accept deposits from, perform services for or otherwise deal with the Company or any Affiliate thereof with the same rights it would have if it were not Trustee.

(14)          No Recourse Against Others. No director, officer, employee or stockholder of the Company or any of the Guarantors, past, present or future, will have any liability for any of the
5


Company’s or such Guarantor’s obligations under the 2029 Notes or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of 2029 Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the 2029 Notes.

(15)          Discharge. The Company’s obligations pursuant to the Indenture will be discharged, except for obligations pursuant to certain sections thereof, subject to the terms of the Indenture, upon the payment or cancellation of all the 2029 Notes or upon the irrevocable deposit with the Trustee of United States dollars or U.S. Government Obligations sufficient to pay when due principal of and interest on the 2029 Notes at maturity or redemption, as the case may be.

(16)          Guarantees. The Company’s obligations under the 2029 Notes are jointly and severally, fully and unconditionally guaranteed, to the extent set forth in the Indenture, by each of the Guarantors.

(17)          Authentication. This Note shall not be valid until the Authentication Agent manually signs the certificate of authentication on this Note.

(18)          Governing Law. THE INTERNAL LAW OF THE STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW OR ANY SUCCESSOR TO SUCH STATUTE) WILL GOVERN AND BE USED TO CONSTRUE THIS 2029 NOTE WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

(19)          Abbreviations. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TENANT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

The Company will furnish to any Holder upon written request and without charge a copy of the Indenture. Requests may be made to:

B.A.T Capital Corporation
c/o British American Tobacco p.l.c.
Globe House
4 Temple Place
London WC2R 2PG
United Kingdom
Facsimile: +44 (0)20 7845 0555
Attention: Company Secretary

With a copy (which shall not constitute notice) to:

Cravath, Swaine & Moore LLP
CityPoint, 1 Ropemaker St.
London EC2Y 9HR
United Kingdom
Facsimile: +44 20 7860 1150
Attention: Alyssa K. Caples
6


ASSIGNMENT

I or we assign and transfer this 2029 Note to:



(Insert assignee’s social security or tax I.D. number)



(Print or type name, address and zip code of assignee)

and irrevocably appoint:


as Transfer Agent to transfer this 2029 Note on the books of the Company. The Transfer Agent may substitute another to act for him.

Date:
 
 
Your Signature:
 
 
 
 
 
 
(Sign exactly as your name appears on the face of this Note)

Signature Guarantee:
 
 
 
 
 
 
 
 


 



SIGNATURE GUARANTEE

Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

7


SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE

The following increases or decreases in this Global Note have been made:

 
Date of
Exchange
 
 
Amount of
decrease in
Principal
Amount of this
Global Note
 
 
Amount of
increase in
Principal
Amount of this
Global Note
 
 
Principal
Amount of this
Global Note
following such
decrease or
increase
 
 
Signature of
authorized
signatory of
Trustee or
Notes
Custodian
 


8
Exhibit 4.5

SUPPLEMENTAL INDENTURE NO. 4 (this “Supplemental Indenture”), dated as of September 6, 2019, among B.A.T Capital Corporation, a corporation incorporated in the state of Delaware (the “Company”), as issuer, British American Tobacco p.l.c., a public limited company incorporated under the laws of England and Wales (the “Parent”), B.A.T. International Finance p.l.c., a public limited company incorporated under the laws of England and Wales (“BATIF”), B.A.T. Netherlands Finance B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of The Netherlands (“BATNF”), and, until its guarantee is released in accordance with the Base Indenture (if ever), Reynolds American Inc., a North Carolina corporation (“RAI”), as guarantors (the “Guarantors”) and Citibank, N.A., as trustee (the “Trustee”).

W I T N E S S E T H

WHEREAS, the Company has heretofore executed and delivered to the Trustee an indenture dated as of September 6, 2019 (the “Base Indenture”), providing for the issuance from time to time of an unlimited aggregate principal amount of guaranteed debt securities;

WHEREAS, Section 7.01(g) of the Base Indenture provides that without the consent of any Holder, the Company, the Guarantors and the Trustee may amend or supplement the Indenture in order to, among other things, issue an unlimited aggregate principal amount of notes under the Base Indenture;

WHEREAS, pursuant to Section 7.01(g) of the Base Indenture, the parties hereto are authorized to execute and deliver this Supplemental Indenture;

WHEREAS, the Company and the Guarantors have taken all necessary corporate action to authorize the execution and delivery of this Supplemental Indenture;

WHEREAS, as contemplated by Section 2.01 of the Base Indenture, the Company intends to issue, and the Guarantors intend to guarantee, a new series of guaranteed debt securities to be known as the Company’s “4.758% Notes due 2049” under the Base Indenture.

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto mutually covenant and agree for the equal and ratable benefit of the Holders of the 2049 Notes (as defined below) as follows:

ARTICLE I

Definitions and Other Provisions of General Application

SECTION 1.01.          Definitions.

Except as otherwise expressly provided in this Supplemental Indenture, all terms used in this Supplemental Indenture which are defined in the Base Indenture shall have the meanings ascribed to them by the Base Indenture.


SECTION 1.02.          Effect of Headings.

The Article and Section headings herein are for convenience only and shall not affect the construction hereof.

SECTION 1.03.          Separability Clause.

In case any provision in this Supplemental Indenture shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

SECTION 1.04.          Benefits of Instrument.

Nothing in this Supplemental Indenture expressed and nothing that may be implied from any of the provisions hereof is intended, or shall be construed, to confer upon, or to give to, any Person other than the parties hereto and their successors and the Holders of the 2049 Notes any benefit or any right, remedy or claim under or by reason of this Supplemental Indenture or any covenant, condition, stipulation, promise or agreement hereof, and all covenants, conditions, stipulations, promises and agreements in this Supplemental Indenture contained shall be for the sole and exclusive benefit of the parties hereto and their successors and of the Holders of the 2049 Notes.

ARTICLE II

4.758% Notes due 2049

SECTION 2.01.          Creation of Series.

There is hereby established a new series of Notes under the Base Indenture entitled “4.758% Notes due 2049” (the “2049 Notes”). The form of the 2049 Notes, including the form of the certificate of authentication, is attached hereto as Exhibit A.

The Company shall issue the 2049 Notes in an aggregate principal amount of $1,000,000,000. The Company may from time to time, without the consent of the Holders of the 2049 Notes, “reopen” the series of 2049 Notes and create and issue additional Notes having substantially identical terms and conditions as the 2049 Notes (or in all respects except as to issue price, denomination, rate of interest, maturity date and the date from which interest, if any, shall accrue, and except as may otherwise be provided in or pursuant to such Officer’s Certificate or supplemental indenture relating thereto) so that the additional Notes are consolidated and form a single series with the outstanding 2049 Notes.

The 2049 Notes shall be initially be represented by one or more 2049 Notes of the same series in registered, global form without interest coupons. The global notes representing the 2049 Notes (collectively, the “2049 Global Notes”) initially shall be (i) be registered in the name of the Depository Trust Company (the “Depositary”) or the nominee of such Depositary, in each case for credit to an account of a member of, or direct or indirect participant in, the Depositary; and (ii) be delivered to Citibank, N.A. as custodian for such Depositary.

2

(a)          The maturity date of the principal of the 2049 Notes shall be September 6, 2049 (the “Maturity Date”).

(b)          The outstanding principal amount of the 2049 Notes shall accrue interest at a rate equal to 4.758% per annum, as provided in Section 2.03.

(c)          Unless supplemented or superseded in this Supplemental Indenture, the terms of the 2049 Notes, including any Events of Default and covenants of the Company and the Guarantors are consistent with the Base Indenture and set forth therein.

SECTION 2.02.          Guarantee.

Subject to the terms and applicable limitations set forth in the Base Indenture and the form of 2049 Notes, each Guarantor, hereby jointly and severally, fully, unconditionally and irrevocably guarantees the 2049 Notes and obligations of the Company hereunder and thereunder, and guarantees to each Holder of a Note authenticated and delivered by the Authentication Agent, and to the Trustee on behalf of such Holder, that (i) the principal of (and premium, if any) and interest on the 2049 Notes will be paid in full when due, whether at the Maturity Date, by acceleration or otherwise (including, without limitation, the amount that would become due but for the operation of any automatic stay provision of any Bankruptcy Law), together with interest on the overdue principal, if any, and all other obligations of the Company to the Holders or the Trustee hereunder or thereunder will be paid in full or performed, all in accordance with the terms hereof and thereof; and (ii) in case of any extension of time of payment or renewal of any 2049 Notes or of any such other obligations, the same will be paid in full when due or performed in accordance with the terms of the extension or renewal, whether at the Maturity Date, by acceleration or otherwise, subject, however, in the case of clauses (i) and (ii) above, to the limitations set forth in Section 9.03 of the Base Indenture.

SECTION 2.03.          Interest.

The 2049 Notes shall bear interest at a rate equal to 4.758% per annum. The 2049 Notes will bear interest from the date of the initial issuance of such 2049 Notes or from the most recent interest payment date to which interest has been paid or provided for, payable semi-annually in arrear on March 6 and September 6 of each year (each, an “Interest Payment Date”), commencing on March 6, 2020 until the Maturity Date, unless previously purchased or redeemed by the Company, to the person in whose name any Note is registered at the close of business on the 15th calendar day preceding each Interest Payment Date, whether or not such day is a Business Day (each, a “Record Date”) notwithstanding any transfer or exchange of such 2049 Notes subsequent to the Record Date and prior to such Interest Payment Date, except that, if and to the extent the Company shall default in the payment of the interest due on such Interest Payment Date, and the applicable grace period shall have expired, such defaulted interest may at the option of the Company be paid to the persons in whose names the outstanding 2049 Notes are registered at the close of business on a subsequent Record Date (which shall not be less than five Business Days prior to the date of payment of such defaulted interest) established by notice sent by or on behalf of the Company to the Holders (which term means registered holders) of the 2049 Notes, not less than 15 days preceding such subsequent Record Date. Interest will be computed on the basis of a 360-day year consisting of twelve 30-day months, or in the case of an
3

incomplete month, the number of days elapsed. If the date on which any interest payment or principal payment is to be made is not a Business Day, such payment will be made on the next day which is a Business Day, without any further interest or other amounts being paid or payable in connection therewith.

SECTION 2.04.          Place of Payment.

The place or places where the principal of, and premium, if any, and interest, if any, and Additional Amounts, if any, on the 2049 Notes shall be payable, the place or places where any 2049 Notes may be surrendered for registration, transfer or exchange and the place or places where notices and demands to or upon the Company in respect of the 2049 Notes may be served are as set forth in the Base Indenture.

SECTION 2.05.          Optional Redemption.

The Company may redeem the 2049 Notes, in whole or in part, at the Company’s option, at any time and from time to time before the Par Call Date (as defined below), at a redemption price equal to the greater of (x) 100% of the principal amount of the 2049 Notes to be redeemed and (y) as determined by the Independent Investment Banker (as defined below), the sum of the present values of the applicable Remaining Scheduled Payments (as defined below) discounted to the date of redemption (the “Redemption Date”) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months or, in the case of an incomplete month, the number of days elapsed) at the Treasury Rate (as defined below) plus 45 basis points, together with accrued and unpaid interest on the principal amount of the 2049 Notes to be redeemed to, but excluding, the Redemption Date.

If the Company elects to redeem the 2049 Notes on or after the Par Call Date, the Company will pay an amount equal to 100% of the principal amount of the 2049 Notes redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

In connection with such optional redemption the following defined terms apply:


Comparable Treasury Issue means the United States Treasury security selected by the Independent Investment Banker that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to, the remaining term of the 2049 Notes to the Par Call Date.


Comparable Treasury Price means, with respect to any Redemption Date, (A) the average of the Reference Treasury Dealer Quotations for that Redemption Date, after excluding the highest and lowest of such Reference Treasury Dealer Quotations or (B) if the Independent Investment Banker for the 2049 Notes obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such Quotations.

4



Independent Investment Banker means one of the Reference Treasury Dealers (as defined below) appointed by the Company to act as the “Independent Investment Banker”.


Par Call Date means March 6, 2049 (six months prior to the Maturity Date of the 2049 Notes.


Reference Treasury Dealer means each of BofA Securities, Inc., Barclays Capital Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and HSBC Securities (USA) Inc. and their respective successors and two other nationally recognized investment banking firms that are Primary Treasury Dealers specified from time to time by the Company; provided, however, that if any of the foregoing shall cease to be a primary U.S. Government securities dealer in New York City (a “Primary Treasury Dealer”), the Company shall substitute therefor another nationally recognized investment banking firm that is a Primary Treasury Dealer.


Reference Treasury Dealer Quotation means, with respect to each Reference Treasury Dealer and any Redemption Date, the average, as determined by the Independent Investment Banker, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Independent Investment Banker by such Reference Treasury Dealer at 3:30 p.m., New York City time, on the third Business Day immediately preceding that Redemption Date.


Remaining Scheduled Payments means, with respect to each 2049 Note to be redeemed, the remaining scheduled payments of the principal thereof and interest thereon that would be due from and including the related Redemption Date, but for such redemption, to but excluding the Par Call Date; provided, however, that if that Redemption Date is not an Interest Payment Date with respect to such 2049 Notes, the amount of the next succeeding scheduled interest payment thereon will be reduced by the amount of interest accrued thereon to that Redemption Date.


Treasury Rate means, with respect to any Redemption Date, the rate per annum equal to the semi-annual equivalent yield to maturity (computed as of the third Business Day immediately preceding that Redemption Date) of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for that Redemption Date.

Notice of any optional redemption will be given in accordance with the Base Indenture at least 10 days but not more than 30 days before the Redemption Date to each Holder of the 2049 Notes to be redeemed.

If less than all the 2049 Notes are to be redeemed pursuant to this Section 2.05, in the case of a redemption at the Company’s option, the 2049 Notes to be redeemed shall be selected in accordance with applicable procedures of DTC.

5

SECTION 2.06.          Redemption for Tax Reasons.

The ability of the Company to redeem the 2049 Notes due to a Change in Tax Law is as set forth in the Base Indenture.

SECTION 2.07.          Additional Amounts.

The applicability of payments of Additional Amounts under the 2049 Notes is as set forth in the Base Indenture. The Company is not required to pay Additional Amounts, except to the extent described in Section 4.10 of the Base Indenture.

ARTICLE III

Miscellaneous Provisions

SECTION 3.01.          Effectiveness. This Supplemental Indenture will become effective upon its execution and delivery.

SECTION 3.02.          Original Issue. The 2049 Notes may, upon execution of this Supplemental Indenture, be executed by the Company and delivered by the Company to the Trustee, as Authentication Agent, for authentication, and the Authentication Agent shall, upon Company order, authenticate and deliver such 2049 Notes as in such Company order provided.

SECTION 3.03.          Ratification and Integral Part. The Base Indenture, as supplemented by this Supplemental Indenture, is in all respects ratified and confirmed, and this Supplemental Indenture will be deemed an integral part of the Indenture in the manner and to the extent herein and therein provided.

SECTION 3.04.          Priority. This Supplemental Indenture shall be deemed part of the Base Indenture in the manner and to the extent herein and therein provided. The provisions of this Supplemental Indenture shall, subject to the terms hereof, supersede the provisions of the Base Indenture with respect to the 2049 Notes to the extent the Base Indenture is inconsistent herewith.

SECTION 3.05.          Successors and Assigns. All covenants and agreements in the Indenture, as supplemented and amended by this Supplemental Indenture, by the Company and the Guarantors will bind their respective successors and assigns, whether so expressed or not.

SECTION 3.06.          NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW OR ANY SUCCESSOR TO SUCH STATUTE) WILL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

6

SECTION 3.07.          Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

SECTION 3.08.          The Trustee. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which are made solely by the Company and the Guarantors.

[Remainder of page intentionally left blank.]


7


IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed and attested, all as of the date first above written.

  B.A.T CAPITAL CORPORATION
 
       

By:
/s/ Neil Wadey
 
    Name:  Neil Wadey  
    Title:    Director
 
       


  BRITISH AMERICAN TOBACCO P.L.C.  
       

By:
/s/ Tadeu Marroco
 
    Name:  Tadeu Marroco
 
    Title:    Director  
       


 
B.A.T. NETHERLANDS FINANCE B.V.
 
       

By:
/s/ M. Wiechers  
    Name:  M. Wiechers  
    Title:    Director  
       
  By:
/s/ JEP Bollen
 
    Name:  JEP Bollen
 
    Title:    Director  


  B.A.T. INTERNATIONAL FINANCE P.L.C.  
       

By:
/s/ Neil Wadey  
    Name:  Neil Wadey  
    Title:    Director
 
       


 
REYNOLDS AMERICAN INC.
 
       

By:
/s/ John R. Whitener
 
    Name:  John R. Whitener
 
   
Title:    SVP Controller - Finance & Accounting
             and Treasurer
 
 

[Signature Page to Supplemental Indenture No. 4]



 
CITIBANK, N.A.,
as Trustee
 
       

By:
/s/ Cirino Emanuele
 
    Name:  Cirino Emanuele
 
    Title:    Senior Trust Officer
 
 


[Signature Page to Supplemental Indenture No. 4]

EXHIBIT A

CUSIP No. 05526D BK0
B.A.T CAPITAL CORPORATION

No.
$

4.758% NOTE DUE 2049

B.A.T Capital Corporation, a corporation incorporated in the state of Delaware (the “Company”), for value received, promises to pay to CEDE & CO. or registered assigns the principal sum of $                   , on September 6, 2049.

Interest Payment Dates: March 6 and September 6, commencing on March 6, 2020.

Record Dates: at the close of business on the 15th calendar day that precedes the related Interest Payment Date, whether or not such day is a Business Day.

Reference is made to the further provisions of this 2049 Note contained herein, which will for all purposes have the same effect as if set forth at this place.

IN WITNESS WHEREOF, the Company has caused this 2049 Note to be signed manually or by facsimile by one of its duly authorized officers.

  B.A.T CAPITAL CORPORATION
 
       

By:
 
 
    Name:  
    Title:  
 

1

Certificate of Authentication

This is one of the 4.758% Notes due 2049 referred to in the within-mentioned Supplemental Indenture.


 
CITIBANK, N.A.,

as Authentication Agent
 
       

By:
 
 
    Authorized Signatory  
   
 
 


Dated:

2


B.A.T CAPITAL CORPORATION

4.758% NOTE DUE 2049

(1)          Interest. B.A.T Capital Corporation, a corporation incorporated in the state of Delaware, as issuer (the “Company”), promises to pay, until the principal hereof is paid or made available for payment, interest on the principal amount set forth on the face hereof at a rate of 4.758% per annum. Interest on the 4.758% Notes due 2049 (the “2049 Notes”) will accrue from and including the most recent date to which interest has been paid or, if no interest has been paid, from and including September 6, 2019, to but excluding the date on which interest is paid. Interest shall be payable in arrears on each March 6 and September 6, commencing on March 6, 2020. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months or, in the case of an incomplete month, the number of days elapsed. The Company shall pay interest on overdue principal (to the full extent permitted by law) at the rate borne by the 2049 Notes.

(2)          Method of Payment. The Company will pay interest to those persons who were Holders of record at the close of business on the 15th calendar day that precedes each Interest Payment Date, whether or not such day is a Business Day. Interest on the 2049 Notes will accrue from the date of original issuance or, if interest has already been paid, from the date it was most recently paid.  If the date on which any interest payment or principal payment is to be made is not a Business Day, such payment will be made on the next day which is a Business Day, without any further interest or other amounts being paid or payable in connection therewith.

(3)          Paying Agent, Transfer Agent and Registrar. Initially, Citibank, N.A. (the “Agent”) will act as a Paying Agent, Transfer Agent and Registrar. The Company may change any Paying Agent, Transfer Agent or Registrar without notice to the Holders. The Company or any of its subsidiaries may act as Paying Agent, Transfer Agent or Registrar.

(4)          Indenture. The Company issued the 2049 Notes under an indenture dated as of September 6, 2019 (the “Indenture”) and a supplemental indenture dated as of September 6, 2019 (the “Supplemental Indenture No. 4”), in each case among the Company, the Guarantors, the Trustee and the Agent. This is one of an issue of Notes of the Company issued, or to be issued, under the Indenture. The terms of the 2049 Notes include those stated in the Indenture and the Supplemental Indenture No. 4. The 2049 Notes are subject to all such terms, and Holders are referred to the Indenture and the Supplemental Indenture No. 4 for a statement of them. Capitalized and certain other terms used and not otherwise defined herein have the meanings set forth in the Indenture or the Supplemental Indenture No. 4 (as applicable).

(5)          Optional Redemption. At any time and from time to time before the applicable Par Call Date, the Company may redeem the 2049 Notes, in whole or in part, at the Company’s option, upon not less than 10 nor more than 30 days’ prior notice, at a price equal to the greater of:

(1)          100% of the aggregate principal amount of any 2049 Notes being redeemed, and
3

(2)          as determined by the Independent Investment Banker, the sum of the present values of the Remaining Scheduled Payments discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months or, in the case of an incomplete month, the number of days elapsed) at the Treasury Rate, plus 45 basis points,

together with, in each case, accrued and unpaid interest on the principal amount of the 2049 Notes to be redeemed to, but excluding, the Redemption Date.

On or after the Par Call Date of the 2049 Notes, the 2049 Notes will be redeemable in whole at any time or in part, from time to time, at the Company’s option, upon at least 10 days’ but no more than 30 days’ prior notice, at a price equal to 100% of the principal amount of the 2049 Notes to be redeemed plus accrued and unpaid interest thereon to, but excluding, the Redemption Date.

The 2049 Notes are also redeemable by the Company, in whole but not in part, at 100% of the principal amount of the 2049 Notes plus accrued and unpaid interest to the applicable Redemption Date (including any Additional Amounts) at the Company’s option at any time prior to their maturity if, due to a Change in Tax Law: (i) the Company or any Guarantor, in accordance with the Supplemental Indenture No. 4, has, or would, become obligated to pay any Additional Amounts to the Holders of the 2049 Notes; (ii) in the case of any Guarantor, (A) the Parent would be unable, for reasons outside its control, to procure payment by the Company or any other Guarantor or (B) the procuring of such payment by the Company and each such other Guarantor would be subject to withholding taxes imposed by a Relevant Taxing Jurisdiction; and (iii) such obligation cannot otherwise be avoided by such Guarantor, the Parent or the Company, taking reasonable measures available to it.

(6)          Redemption Procedures. If the Company elects to redeem less than all of the 2049 Notes at any time, in the case the 2049 Notes are issued in definitive form, the 2049 Notes to be redeemed shall be selected in accordance with applicable procedures of the Depositary.

(7)          Notice of Redemption. Notices of redemption shall be transmitted at least 10 but not more than 30 days before the Redemption Date to each Holder of 2049 Notes to be redeemed in accordance with Section 10.01 of the Indenture. If the 2049 Notes are to be redeemed in part only, the notice of redemption that relates to such 2049 Notes will state the portion of the principal amount thereof that is to be redeemed.

(8)          Denominations, Transfer, Exchange. The 2049 Notes shall be issuable only in fully registered form without coupons in denominations of $2,000 and any integral multiple of $1,000 in excess thereof. A Holder may transfer or exchange 2049 Notes in accordance with the Indenture.

(9)          Persons Deemed Owners. The Depositary may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of the 2049 Global Notes for all purposes whatsoever.

(10)          Unclaimed Money. If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent will pay the money back to the Company
4

at its request or, if such money is then held by the Company in trust, such money shall be released from such trust. After that, Holders entitled to the money must look only to the Company for payment as general creditors unless applicable abandoned property law designates another Person.

(11)          Amendment, Supplement, Waiver, Etc. The Company, the Guarantors and the Trustee may modify or amend the Indenture, the 2049 Notes or the Guarantees without the consent of any Holder to, among other things, cure any ambiguity, or to correct or supplement any provision contained in the Indenture, the 2049 Notes or the Guarantees and add to the covenants, or the restrictions, conditions or provisions applicable to, the Company and Guarantors, as the case may be, such further covenants, restrictions, conditions or provisions as the Company and any Guarantor, as the case may be, shall consider to be for the protection of the Holders of the applicable 2049 Notes issued pursuant to the Indenture. Other amendments and modifications of the Indenture or the 2049 Notes may be made by the Company and the Trustee with the consent of the Holders of a majority of the aggregate principal amount of the outstanding 2049 Notes, subject to certain exceptions requiring the consent of each of the Holders of the 2049 Notes to be affected.

(12)          Defaults and Remedies. Events of Default are set forth in the Indenture. Subject to certain limitations in the Indenture, if an Event of Default with respect to the 2049 Notes (other than an Event of Default specified in Section 5.01 (vii), (viii) or (ix) of the Indenture with respect to the Company or any Guarantor), shall have occurred and be continuing, unless the principal of all the 2049 Notes shall have already become due and payable, the Holders of not less than 25% in aggregate principal amount of the 2049 Notes then outstanding, by notice in writing to the Company, each Guarantor and the Trustee, may declare the entire principal amount of all 2049 Notes and interest accrued and unpaid thereon, if any, to be due and payable immediately, and upon any such declaration the same shall become immediately due and payable, without any further declaration or other act on the part of any Holder. If certain Events of Default specified in Section 5.01 (vii), (viii) or (ix) of the Indenture occur with respect to the Company and are continuing, the principal amount of and accrued and unpaid interest on all the 2049 Notes issued pursuant to this Indenture shall become immediately due and payable, without any declaration or other act on the part of the Trustee or any Holder. The Trustee shall be under no obligation to exercise any of its rights or powers under the Indenture at the request or direction of any of the Holders, unless such Holders have offered to the Trustee security or indemnity satisfactory to the Trustee. Except in the case of a Default or Event of Default in payment of the principal of, premium, if any, or interest on any Note (including payments pursuant to a redemption or repurchase of the 2049 Notes pursuant to the provisions of the Indenture), the Trustee may withhold the notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of Holders.

(13)          Trustee Dealings with Company. The Trustee in its individual or any other capacity may become the owner or pledgee of 2049 Notes and may make loans to, accept deposits from, perform services for or otherwise deal with the Company or any Affiliate thereof with the same rights it would have if it were not Trustee.

(14)          No Recourse Against Others. No director, officer, employee or stockholder of the Company or any of the Guarantors, past, present or future, will have any liability for any of the
5

Company’s or such Guarantor’s obligations under the 2049 Notes or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of 2049 Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the 2049 Notes.

(15)          Discharge. The Company’s obligations pursuant to the Indenture will be discharged, except for obligations pursuant to certain sections thereof, subject to the terms of the Indenture, upon the payment or cancellation of all the 2049 Notes or upon the irrevocable deposit with the Trustee of United States dollars or U.S. Government Obligations sufficient to pay when due principal of and interest on the 2049 Notes at maturity or redemption, as the case may be.

(16)          Guarantees. The Company’s obligations under the 2049 Notes are jointly and severally, fully and unconditionally guaranteed, to the extent set forth in the Indenture, by each of the Guarantors.

(17)          Authentication. This Note shall not be valid until the Authentication Agent manually signs the certificate of authentication on this Note.

(18)          Governing Law. THE INTERNAL LAW OF THE STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW OR ANY SUCCESSOR TO SUCH STATUTE) WILL GOVERN AND BE USED TO CONSTRUE THIS 2049 NOTE WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

(19)          Abbreviations. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TENANT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

The Company will furnish to any Holder upon written request and without charge a copy of the Indenture. Requests may be made to:

B.A.T Capital Corporation
c/o British American Tobacco p.l.c.
Globe House
4 Temple Place
London WC2R 2PG
United Kingdom
Facsimile: +44 (0)20 7845 0555
Attention: Company Secretary

With a copy (which shall not constitute notice) to:

Cravath, Swaine & Moore LLP
CityPoint, 1 Ropemaker St.
London EC2Y 9HR
United Kingdom
Facsimile: +44 20 7860 1150
Attention: Alyssa K. Caples

6


ASSIGNMENT

I or we assign and transfer this 2049 Note to:


(Insert assignee’s social security or tax I.D. number)



(Print or type name, address and zip code of assignee)


and irrevocably appoint:


as Transfer Agent to transfer this 2049 Note on the books of the Company. The Transfer Agent may substitute another to act for him.

Date:
   
Your Signature:  
   
 
   
(Sign exactly as your name appears on the face of this Note)

Signature Guarantee:          
 


SIGNATURE GUARANTEE

Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

7


SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE

The following increases or decreases in this Global Note have been made:

 
Date of Exchange
 
 
Amount of
decrease in
Principal
Amount of this
Global Note
 
 
Amount of
increase in
Principal
Amount of this
Global Note
 
 
Principal
Amount of this
Global Note
following such
decrease or
increase
 
 
Signature of
authorized
signatory of
Trustee or
Notes
Custodian
 



8
Exhibit 5.1



[Cravath Letterhead]

September 6, 2019


B.A.T Capital Corporation
$1,000,000,000 2.789% Notes due 2024
$1,000,000,000 3.215% Notes due 2026
$500,000,000 3.462% Notes due 2029
$1,000,000,000 4.758% Notes due 2049

Ladies and Gentlemen:

We have acted as U.S. counsel to B.A.T Capital Corporation, a Delaware corporation (the “Issuer”) and each of the guarantors listed on Annex A to this opinion (the “Guarantors”), in connection with (i) the filing by the Issuer and the Guarantors with the Securities and Exchange Commission (the “Commission”) of a registration statement on Form F-3 (the “Registration Statement”) under the Securities Act of 1933, as amended (the “Act”), relating to the registration under the Act and the proposed issuance and sale from time to time pursuant to Rule 415 under the Act of an undetermined principal amount of debt securities of the Issuer in one or more series and the guarantees of the debt securities by the Guarantors (the “Guarantees”) and (ii) the preparation and filing by the Issuer and the Guarantors of a prospectus supplement, dated September 3, 2019 (the “Prospectus Supplement”), with the Commission relating to the issuance and sale by the Issuer of $1,000,000,000 aggregate principal amount of 2.789% Notes due 2024 (the “2024 Notes”), $1,000,000,000 aggregate principal amount of 3.215% Notes due 2026 (the “2026 Notes”), $500,000,000 aggregate principal amount of 3.462% Notes due 2029 (the “2029 Notes”) and $1,000,000,000 aggregate principal amount of 4.758% Notes due 2049 (the “2049 Notes” and, together with the 2024 Notes, the 2026 Notes, and the 2029 Notes, the “Notes”), to be issued pursuant to an indenture among BATCAP as issuer, the Guarantors and Citibank, N.A. as trustee, authentication agent, initial paying agent, registrar, transfer agent and calculation agent (the “Trustee”) (the “Indenture”), as supplemented by: (i) the supplemental indenture no. 1 dated as of September 6, 2019, among the Issuer, the Guarantors and the Trustee (the “Supplemental Indenture No. 1”); (ii) the supplemental indenture no. 2 dated as of September 6, 2019, among the Issuer, the Guarantors and the Trustee (the



Supplemental Indenture No. 2”); (iii) the supplemental indenture no. 3 dated as of September 6, 2019, among the Issuer, the Guarantors and the Trustee (the “Supplemental Indenture No. 3”); (iv) the supplemental indenture no. 4 dated as of September 6, 2019, among the Issuer, the Guarantors and the Trustee (the “Supplemental Indenture No. 4” and, together with the Supplemental Indenture No. 1, the Supplemental Indenture No. 2, and the Supplemental Indenture No. 3, the “Supplemental Indentures”), in each case supplementing the Indenture, in accordance with the underwriting agreement dated as of September 3, 2019, among the Issuer, the Guarantors and BofA Securities, Inc., Barclays Capital Inc., Citigroup Global Markets Inc., Deutsche Bank Securities and HSBC Securities (USA) Inc., as representatives of the several underwriters listed on Schedule I thereto (the “Underwriters”) (the “Underwriting Agreement”).

In that connection, we have examined originals, or copies certified or otherwise identified to our satisfaction, of such documents, corporate records and other instruments as we have deemed necessary or appropriate for the purposes of this opinion, including, without limitation: (a) the Amended and Restated Certificate of Incorporation of BATCAP, as adopted on September 8, 2008; (b) the Amended and Restated By-laws of BATCAP, as adopted on July 27, 2007; (c) resolutions adopted by Board of Directors of BATCAP on June 20, 2019; (d) the Registration Statement; (e) the Indenture; (f) the Supplemental Indentures and (g) the forms of the Notes. We have relied, with respect to certain factual matters, on representations and warranties of directors and officers of the Issuer and the Guarantors.

In expressing the opinions set forth herein, we have assumed, with your consent and without independent investigation or verification, the genuineness of all signatures, the legal capacity and competency of all natural persons, the due incorporation and valid existence of the Guarantors, the authenticity of all documents submitted to us as originals and the conformity to authentic original documents of all documents submitted to us as duplicates or copies. We have also assumed, with your consent, that the choice of New York law contained in the Indenture and each Supplemental Indenture is legal and valid under the laws of England and Wales, the Netherlands and North Carolina and that insofar as any obligation under each Indenture is to be performed in, or by a party organized under the laws of, any jurisdiction outside the State of New York or the State of Delaware, its performance will not be illegal or ineffective in any such jurisdiction by virtue of the law of that jurisdiction. We have also assumed, with your consent, that the Indenture (including the Guarantees therein) and each Supplemental Indenture, in each case supplementing the Indenture, have been duly authorized, executed and delivered by the Trustee and the Guarantors and that the forms of the Notes will conform to those included in the respective Supplemental Indenture.

We do not purport to express an opinion on or address all matters of U.S. law that may be of relevance with respect to the proposed issuance and sale of the Notes. This letter is strictly limited to the matters presented in it and does not extend, by implication or otherwise, to any matters not referenced herein.

Based upon and subject to the foregoing, we are of opinion that:

1.  When the Notes have been duly authenticated by the Trustee in accordance with the provisions of the Indenture and the respective Supplemental



Indenture and upon payment of the consideration therefor provided for in the Underwriting Agreement, such Notes will be validly issued and constitute valid and binding obligations of the Issuer, enforceable against the Issuer in accordance with their terms (subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and other similar laws affecting creditors’ rights generally from time to time in effect and to general principles of equity, including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing, regardless of whether considered in a proceeding in equity or at law).

2.  When the Notes underlying the Guarantees have been duly authenticated by the Trustee in accordance with the provisions of the Indenture and the respective Supplemental Indenture and upon payment of the consideration therefor provided for in the Underwriting Agreement, each Guarantee will constitute the valid and binding obligation of the Guarantors, enforceable against the Guarantors in accordance with its terms (subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and other similar laws affecting creditors’ rights generally from time to time in effect and to general principles of equity, including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing, regardless of whether considered in a proceeding in equity or at law).

We are admitted to practice only in the State of New York, and we express no opinion as to matters governed by any laws other than the laws of the State of New York and the General Corporation Law of the State of Delaware. In particular, we do not purport to pass on any matter governed by the laws of England and Wales, the Netherlands or the State of North Carolina.

We hereby consent to the filing of this opinion with the Commission as Exhibit 5.1 to British American Tobacco p.l.c.’s current report on Form 6-K filed on September 6, 2019 and to the incorporation by reference of this opinion into the Registration Statement. We also consent to the reference to our firm under the caption “Legal Matters” in the prospectus constituting a part of the Registration Statement and the Prospectus Supplement. In giving such consent, we do not thereby admit that we are included in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission.




Very truly yours,
 
/s/ Cravath, Swaine & Moore LLP



British American Tobacco p.l.c.
Globe House
4 Temple Place
London WC2R 2PG
United Kingdom

B.A.T Capital Corporation
103 Foulk Road, Suite 120
Wilmington, Delaware 19803
United States



ANNEX A

Guarantors

British American Tobacco p.l.c.

B.A.T. Netherlands Finance B.V.

Reynolds American Inc.

B.A.T. International Finance p.l.c.
Exhibit 5.2

 
 
Linklaters LLP
One Silk Street
London EC2Y 8HQ
Telephone (+44) 20 7456 2000
Facsimile (+44) 20 7456 2222
DX Box Number 10 CDE
 


To:
 
British American Tobacco p.l.c.
Globe House
4 Temple Place
London WC2R 2PG
 
 

6 September 2019

Our Ref
EXM/MT/BB

U.S.$ Fixed Rate Notes (the “Notes”) of B.A.T Capital Corporation (“BATCAP” or the “Issuer”) and guaranteed by British American Tobacco p.l.c. (“British American Tobacco”), B.A.T. International Finance p.l.c. (“BATIF”), Reynolds American Inc. (“RAI”), and B.A.T. Netherlands Finance B.V. (“BATNF”) (the “Guarantors”) issued pursuant to the U.S. Shelf Registration Statement of BATCAP and BATIF (the “Registration Statement”)

 
1
We have acted as English legal advisers to the Issuer and the Guarantors in connection with the issue of the Notes and the giving of the guarantees (the “Guarantees”) by the Guarantors in respect of the Notes and have taken instructions solely from the Issuer and the Guarantors.

2
This opinion is limited to English law as applied by the English courts and in effect on the date of this opinion. It is given on the basis that it, and all matters relating to it, will be governed by, and that it (including all terms used in it) will be construed in accordance with, English law. In particular, we express no opinion herein with regard to any system of law (including, for the avoidance of doubt, the federal laws of the United States of America and the laws of the State of New York) other than the laws of England as currently applied by the English courts.

3
For the purpose of this opinion we have examined the documents listed and, where appropriate, defined in the Schedule to this opinion.

4
We have assumed that:

4.1
all copy documents conform to the originals and all originals are genuine and complete

4.2
each signature is the genuine signature of the individual concerned

4.3
(except in the case of BATIF and British American Tobacco) all relevant documents are within the capacity and powers of, and have been validly authorised by, each party

4.4
(in the case of each party) all relevant documents have been or (in the case of the Notes and the Guarantees) will be validly executed and delivered by the relevant party

This communication is confidential and may be privileged or otherwise protected by work product immunity.


Linklaters LLP is a limited liability partnership registered in England and Wales with registered number OC326345. It is a law firm regulated by the Solicitors Regulation Authority. The term partner in relation to Linklaters LLP is used to refer to a member of Linklaters LLP or an employee or consultant of Linklaters LLP or any of its affiliated firms or entities with equivalent standing and qualifications. A list of the names of the members of Linklaters LLP together with a list of those non-members who are designated as partners and their professional qualifications is open to inspection at its registered office, One Silk Street, London EC2Y 8HQ or on www.linklaters.com and such persons are either solicitors, registered foreign lawyers or European lawyers.

Please refer to www.linklaters.com/regulation for important information on our regulatory position.




4.5
each of the meetings of the Board of Directors of British American Tobacco and BATIF held on 3 June 2019 and 17 June 2019, respectively, (in respect of which a certified extract of each of the Minutes has been supplied to us) was duly convened, constituted and quorate and the resolutions referred to in each of the Minutes were validly passed and remain in full force and effect without modification and

4.6
each of the documents which are the subject of this opinion is valid and binding on each party under the law to which it is expressed to be subject where that is not English law and that words and phrases used in those documents have the same meaning and effect as they would if those documents were governed by English law.

5
References in this opinion to:

5.1
the “Programme Documents” are to the Underwriting Agreement and the Indentures.

6
Based on the documents referred to, and assumptions made, in paragraphs 3 and 4 above and subject to the qualifications in paragraph 7 below and to any matters not disclosed to us, we are of the following opinion:

6.1
BATIF has been incorporated and is existing as a company with limited liability under the laws of England.

6.2
BATIF has corporate power to enter into and to perform its obligations under the Programme Documents and the Notes and has taken all necessary corporate action to authorise its execution, delivery and performance of the Programme Documents and the Notes.

6.3
British American Tobacco has been incorporated and is existing as a company with limited liability under the laws of England.

6.4
British American Tobacco has corporate power to enter into and to perform its obligations under the Programme Documents and has taken all necessary corporate action to authorise its execution, delivery and performance of the Programme Documents.

7
This opinion is subject to the following:

7.1
It should be understood that we have not been responsible for investigating or verifying the accuracy of the facts, including statements of foreign law, or the reasonableness of any statements of opinion, contained in the Prospectus, or that no material facts have been omitted from it.

7.2
We express no opinion as to compliance or otherwise with any financial limitations on borrowings or the giving of guarantees by BATIF contained in BATIF’s Articles of Association or any financial limitations on borrowings or the giving of guarantees by British American Tobacco contained in British American Tobacco’s Articles of Association.

7.3
We express no opinion as to compliance or otherwise with the limitation on the maximum aggregate principal amount of the debt securities which have been authorised by the Issuer and BATIF with respect to the Registration Statement.

7.4
To the extent it relates to United Kingdom stamp duties any undertaking or indemnity given by BATIF or British American Tobacco may be void under Section 117 of the Stamp Act 1891.

7.5
An English court may refuse to give effect to any contractual provision concerning payment of the costs of enforcement or litigation brought before an English court.

Page 2 of 4



7.6
An English court may, or may be required to, stay proceedings or decline jurisdiction in certain circumstances - for example, if proceedings are brought elsewhere.

7.7
Effect may be given to the overriding mandatory provisions of the law of the country where the obligations arising out of a contract have to be or have been performed, in so far as those provisions render the performance of the contract unlawful. In such circumstances, the relevant obligations may not be enforceable.

7.8
The English courts may have regard to the law of the country in which performance takes place in relation to the manner of performance and the steps to be taken in the event of defective performance.

7.9
The English courts may not be restricted from applying overriding provisions of English law and if there is a provision of New York law that is manifestly incompatible with English public policy, it is possible that the English courts may not apply it.

8
This opinion is given on the basis that there will be no amendment to or termination or replacement of the documents, authorisations, consents and opinions referred to in the Schedule to this opinion. This opinion is also given on the basis that we undertake no responsibility to notify any addressee of this opinion of any change in English law after the date of this opinion, including any change occurring as a result of the United Kingdom withdrawing from the European Union without a formal withdrawal agreement.

9
This opinion is addressed to you solely for your benefit in connection with the filing of the Prospectus. It is not to be transmitted to anyone else nor is it to be relied upon by anyone else or for any other purpose or quoted or referred to in any public document or filed with anyone without our express consent.

10
We hereby consent to the filing of this opinion as an exhibit to, and the reference to us made under the heading “Legal Matters” in, the Prospectus. In giving this consent we do not admit that we are within the category of persons whose consent is required within section 7 of the United States Securities Act of 1933 or the rules and regulations of the SEC thereunder.


Yours faithfully

/s/ Linklaters LLP 

Linklaters LLP


Page 3 of 4



SCHEDULE

1
A certified copy of the Memorandum and Articles of Association of BATIF.

2
A certified extract of the Minutes of a Meeting of the Board of Directors of BATIF held 17 June 2019.

3
A certified copy of the Memorandum and Articles of Association of British American Tobacco.

4
A certified extract from the Minutes of a Meeting of the Board of Directors of British American Tobacco held on 3 June 2019.

5
A copy of the Prospectus dated 17 July 2019 (the “Original Prospectus”) and the Prospectus Supplement dated 3 September 2019 (the “Prospectus Supplement”, and together with the Original Prospectus, the “Prospectus”).

6
Underwriting Agreement dated 3 September 2019 (the “Underwriting Agreement”) between the Issuer, the Guarantors and BofA Securities, Inc., Barclays Capital Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and HSBC Securities (USA) Inc. (the “Underwriters”) relating to the purchase and sale of the Notes.

7
Indenture dated 6 September 2019 between BATCAP, as Issuer, British American Tobacco, BATIF, BATNF and RAI, each as a guarantor, the Trustee and Citibank, N.A. as initial paying agent, authentication agent, transfer agent, registrar and calculation agent (in each such several capacities as the “Paying Agent”, “Authentication Agent”, “Transfer Agent”, “Registrar” and “Calculation Agent”) relating to the Notes (the “Base Indenture”).

8
Supplemental Indenture No. 1 dated 6 September 2019 between BATCAP, as Issuer, British American Tobacco, BATIF, BATNF and RAI, each as a guarantor, the Trustee and Citibank, N.A. as paying agent, authentication agent, transfer agent, registrar and calculation agent (in each such several capacities as the “Paying Agent”, “Authentication Agent”, “Transfer Agent”, “Registrar” and “Calculation Agent”) relating to the U.S.$1,000,000,000 2.789 per cent. Notes due 2024 (the “2024 Notes Indenture”).

9
Supplemental Indenture No. 2 dated 6 September 2019 between BATCAP, as Issuer, British American Tobacco, BATIF, BATNF and RAI, each as a guarantor, the Trustee and Citibank, N.A. as paying agent, authentication agent, transfer agent, registrar and calculation agent (in each such several capacities as the “Paying Agent”, “Authentication Agent”, “Transfer Agent”, “Registrar” and “Calculation Agent”) relating to the U.S.$1,000,000,000 3.215 per cent. Notes due 2026 (the “2026 Notes Indenture”).

10
Supplemental Indenture No. 3 dated 6 September 2019 between BATCAP, as Issuer, British American Tobacco, BATIF, BATNF and RAI, each as a guarantor, the Trustee and Citibank, N.A. as paying agent, authentication agent, transfer agent, registrar and calculation agent (in each such several capacities as the “Paying Agent”, “Authentication Agent”, “Transfer Agent”, “Registrar” and “Calculation Agent”) relating to the U.S.$500,000,000 3.462 per cent. Notes due 2029 (the “2029 Notes Indenture”).

11
Supplemental Indenture No. 4 dated 6 September 2019 between BATCAP, as Issuer, British American Tobacco, BATIF, BATNF and RAI, each as a guarantor, the Trustee and Citibank, N.A. as paying agent, authentication agent, transfer agent, registrar and calculation agent (in each such several capacities as the “Paying Agent”, “Authentication Agent”, “Transfer Agent”, “Registrar” and “Calculation Agent”) relating to the U.S.$1,000,000,000 4.758 per cent. Notes due 2049 (the “2049 Notes Indenture”, and together with the Base Indenture, the 2024 Indenture, the 2026 Indenture and the 2029 Indenture, the “Indentures”).


Page 4 of 4
Exhibit 5.3





 
B.A.T. Netherlands Finance B.V.
Handelsweg 53A
1181 ZA Amsterdam
 
 
 

 
 
 
Stibbe N.V.
Advocaten en notarissen
Beethovenplein 10
P.O. Box 75640
1070 AP Amsterdam
The Netherlands
T +31 20 546 0 606
F +31 20 546 0 123
www.stibbe.com
Date
6 September 2019
Shelf Programme 2019 – September 2019 issuance
 
 
Ladies and Gentlemen,

(1)
We have acted as counsel with respect to matters of the laws of the Netherlands to B.A.T. Netherlands Finance B.V. (the “Guarantor”) in connection with the registration statement on Form F-3 under the Securities Act of 1933 of the United States dated 17 July 2019 (the “Registration Statement”) in relation to the registration of the offer and sale, from time to time, of debt securities by B.A.T Capital Corporation (“BATCAP”) and B.A.T. International Finance p.l.c. (“BATIF”).
   
 
This opinion is furnished to you in order to be filed as an exhibit to Registration Statement with the United States Securities and Exchange Commission.
   
(2)
For the purpose of this opinion, we have examined and exclusively relied upon photocopies or copies received by fax or by electronic means, or originals if so expressly stated, of the following documents:

 
(a)
the prospectus supplement dated 3 September 2019 supplementing the Registration Statement;
     
 
(b)
the underwriting agreement by and among (1) the underwriters named in schedule 1 thereto, (2) BATCAP (as issuer) (the “Issuer”), (3) British American Tobacco p.l.c. (as parent) (the “Parent Guarantor”) and (4) BATIF, the Guarantor and Reynolds American Inc. (“RAI”) (as guarantors) dated 3 September 2019;
     
 
(c)
the base indenture by and among (1) the Issuer (as company), (2) the Parent Guarantor, BATIF, the Guarantor and RAI (as guarantors), (3) Citibank, N.A. (as trustee) (the “Trustee”) and (4) Citibank, N.A. (as authentication agent, transfer agent, registrar, calculation agent and initial paying agent) dated [6] September 2019;
     
 
(d)
the supplemental indenture no. 1 relating to the $1,000,000,000 Notes due 2024 by and among (1) the Issuer (as company), (2) the Parent Guarantor, BATIF,

Stibbe N.V. is registered with the Dutch Chamber of Commerce under number 34198700. Any services performed are carried out under an agreement for services (‘overeenkomst van opdracht’) with Stibbe N.V., which is governed exclusively by Dutch law. The general conditions of Stibbe N.V., which include a limitation of liability, apply and are available on www.stibbe.com/generalconditions or upon request.









   
the Guarantor and RAI (as guarantors) and (3) the Trustee (as trustee) dated 6 2019 September;
     
 
(e)
the supplemental indenture no. 2 relating to the $1,000,000,000 Notes due 2026 by and among (1) the Issuer (as company), (2) the Parent Guarantor, BATIF, the Guarantor and RAI (as guarantors) and (3) the Trustee (as trustee) dated 6 September 2019;
     
 
(f)
the supplemental indenture no. 3 relating to the $500,000,000 Notes due 2029 by and among (1) the Issuer (as company), (2) the Parent Guarantor, BATIF, the Guarantor and RAI (as guarantors) and (3) the Trustee (as trustee) dated 6 September 2019;
     
 
(g)
the supplemental indenture no. 4 relating to the $1,000,000,000 Notes due 2049 by and among (1) the Issuer (as company), (2) the Parent Guarantor, BATIF, the Guarantor and RAI (as guarantors) and (3) the Trustee (as trustee) dated 6 September 2019;
     
 
(h)
the deed of incorporation of the Guarantor dated 23 April 2014 including its articles of association (statuten), which according to the Extract referred to below are the articles of association of the Guarantor as currently in force;
     
 
(i)
an extract from the Trade Register of the Chamber of Commerce (Kamer van Koophandel, afdeling Handelsregister) relating to the Guarantor dated the date hereof (the “Extract”); and
     
 
(j)
the minutes of a meeting of the managing board of the Guarantor held on 12 June 2019 reflecting resolutions approving, inter alia, the execution by the Guarantor of the Agreements (as defined below) and the performance of its obligations thereunder (the “Resolution”).
     

(3)
The documents listed in paragraphs (2)(b) - (g) (inclusive) are hereinafter collectively also referred to as the “Agreements”.
   
 
References to the Civil Code, the Bankruptcy Act, the Code of Civil Procedure, the Financial Supervision Act and any other Codes or Acts are references to the Burgerlijk Wetboek, the Faillissementswet, the Wetboek van Burgerlijke Rechtsvordering, the Wet op het financieel toezicht and such other Codes or Acts of the Netherlands, as amended. In this opinion, “the Netherlands” refers to the European part of the Kingdom of the Netherlands and “EU” refers to the European Union.


(2)







(4)
In rendering this opinion we have assumed:

 
(a)
the genuineness of all signatures on, and the authenticity and completeness of, all documents submitted to us as copies of drafts, originals or execution copies and the exact conformity to the originals of all documents submitted to us as photocopies or copies transmitted by facsimile or by electronic means;
     
 
(b)
(i) the power, capacity and authority of all parties thereto other than the Guarantor to enter into and execute the Agreements; (ii) that the Agreements have been duly authorised by all parties thereto other than the Guarantor; and (iii) that the Agreements have been validly executed and delivered (where such concept is legally relevant) by each of the parties thereto (including but not limited to the Guarantor) under all applicable laws, including the laws by which the Agreements are expressed to be governed, other than the laws of the Netherlands;
     
 
(c)
that any and all authorisations and consents of, or other filings with or notifications to, any public authority or other relevant body or person in or of any jurisdiction which may be required (other than under the laws of the Netherlands) in respect of the execution or performance of the Agreements have been or will be duly obtained or made, as the case may be;
     
 
(d)
that the information set forth in the Extract is complete and accurate on the date hereof and consistent with the information contained in the files kept by the Trade Register with respect to the Guarantor;
     
 
(e)
that the Resolution has not been annulled, revoked or rescinded and is in full force and effect as at the date hereof;
     
 
(f)
that the Guarantor has not been declared bankrupt (failliet verklaard), granted suspension of payments (surseance van betaling verleend) or dissolved (ontbonden), nor has ceased to exist due to merger (fusie) or demerger (splitsing); although not constituting conclusive evidence, this assumption is supported by the contents of the Extract and by our online search of the Central Insolvency Register of the courts in the Netherlands (Centraal Insolventieregister) on the date hereof, which did not reveal any information which would render this assumption to be untrue;
     
 
(g)
that none of the insolvency proceedings listed in Annex A, as amended, to Regulation (EU) 2015/848 of the European Parliament and of the Council of 20 May 2015 on insolvency proceedings has been declared applicable to the Guarantor by a court in one of the member states of the EU (with the exception of Denmark), other than the Netherlands; although not constituting conclusive evidence, this assumption is supported by our online search of the section on EU Registrations of the Central Insolvency Register (Centraal Insolventieregister) on the date hereof, which did not reveal any information which would render this assumption to be untrue;


(3)







 
(h)
that none of the members of the managing board of the Guarantor has a conflict of interests within the meaning of section 2:239 of the Civil Code with the Guarantor with respect to the Agreements or the transactions contemplated thereby; and
     
 
(i)
that the granting of a guarantee given by the Guarantor with respect to the obligations of the Issuer in clause 9.01 of the Base Indenture can be regarded as being in the corporate interest of the Guarantor  for purposes of section 2:7 of the Netherlands Civil Code and cannot be regarded as constituting an act of fraudulent conveyance which is subject to challenge pursuant to section 3:45 of the Netherlands Civil Code or section 42 of the Netherlands Bankruptcy Code.

(5)
We have not investigated the laws of any jurisdiction other than the Netherlands. This opinion is limited to matters of the laws of the Netherlands as they presently stand. We do not express any opinion with respect to (i) any public international law or the rules of or promulgated under any treaty or by any treaty organisation, other than any provisions of EU law having direct effect, (ii) matters of competition law, and (iii) matters of taxation.
   
(6)
Based upon and subject to the foregoing and to the further qualifications, limitations and exceptions set forth herein, and subject to any factual matters not disclosed to us and inconsistent with the information revealed by the documents reviewed by us in the course of our examination referred to above, we are as at the date hereof of the following opinion:

 
(a)
the Guarantor has been duly incorporated and is validly existing under the laws of the Netherlands as a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) and has the necessary corporate capacity and power to enter into the Agreements and to exercise its rights and perform its obligations thereunder;
     
 
(b)
all corporate action required to be taken by the Guarantor to authorise the execution of the Agreements by it or on its behalf and the performance of its obligations thereunder has been duly taken; and
     
 
(c)
the Agreements have been duly executed on behalf of the Guarantor.

(7)
This opinion is subject to the following qualifications:

 
(a)
we express no opinion as to the accuracy of any representations given by the Guarantor or any other party (express or implied) under or by virtue of the Agreements; and
     
 
(b)
the opinions expressed above are limited by any applicable bankruptcy (faillissement), suspension of payments (surseance van betaling), insolvency, moratorium, reorganisation, liquidation, fraudulent conveyance, or similar laws affecting the enforceability of rights of creditors generally (including rights of set-off) in any relevant jurisdiction including but not limited to section 3:45 of the Civil Code and section 42 of the Bankruptcy Act concerning fraudulent conveyance, as well as by any sanctions or measures under the Sanctions Act 1977 (Sanctiewet 1977) or by EU or other international sanctions.


(4)







(8)
In this opinion, Netherlands legal concepts are expressed in English terms and not in their original Dutch terms. The concepts concerned may not be identical to the concepts described by the same English terms as they exist under the laws of other jurisdictions. This opinion is given by Stibbe N.V. and may only be relied upon under the express condition that (i) any issues of interpretation or liability arising hereunder will be governed by the laws of the Netherlands and will be brought exclusively before a court of the Netherlands, and (ii) such liability, if any, shall be limited to Stibbe N.V. only, to the exclusion of any of its directors, partners, employees, shareholders and advisors or its or their affiliates and to the aggregate of the amount paid under Stibbe N.V.’s professional insurance in the particular instance and any applicable deductible payable by Stibbe N.V.
   
(9)
We assume no obligation to update this opinion or to inform any person of any changes of law or other matters coming to our knowledge occurring after the date hereof which may affect this opinion in any respect. This opinion is addressed to you and given for your sole benefit for the purposes of the Agreements only and may not be disclosed or quoted to any person other than to your legal advisers or relied upon by any person or be used for any other purpose, without our prior written consent in each instance.
   
(10)
We hereby consent to the filing of this opinion as exhibit to the Registration Statement and to the reference to our firm under the caption “Legal Matters” in the prospectus supplement constituting a part of the Registration Statement. In giving such consent, we do not thereby admit or imply that we are included in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the United States Securities and Exchange Commission


Yours faithfully,

Stibbe N.V.



/s/ Rein van Helden   /s/ Rogier Raas
Rein van Helden  
 
Rogier Raas




(5)
Exhibit 5.4



 

 
 
 
 
1001 West Fourth Street
Winston-Salem, NC 27101
 


September 6, 2019


Reynolds American Inc.
401 North Main Street
Winston-Salem, North Carolina 27102-2990

Re: Offering Pursuant to Registration Statement on Form F-3

Ladies and Gentlemen:


We have acted as special North Carolina counsel to Reynolds American Inc., a North Carolina corporation (“RAI”), in connection with a public offering by B.A.T Capital Corporation, a Delaware corporation (the “Issuer”) of (i) $1,000,000,000 aggregate principal amount of the Issuer’s 2.789% notes due 2024 (the “2024 Notes”),(ii) $1,000,000,000 aggregate principal amount of the Issuer’s 3.215% notes due 2026 (the “2026 Notes”), (iii) $500,000,000 aggregate principal amount of the Issuer’s 3.462% notes due 2029 (the “2029 Notes”), and (iv) $1,000,000,000 aggregate principal amount of the Issuer’s 4.758% notes due 2049 (the “2049 Notes”, and, together with the 2024 Notes, 2026 Notes and 2029 Notes, the “Notes”), and the related guarantee thereof by each of the guarantors, including RAI (such guarantee of RAI, the “RAI Guarantee”), pursuant to a registration statement on Form F-3 filed with the U.S. Securities and Exchange Commission (the Commission”“) on July 17, 2019 (Registration No. 333-232691) (the “Registration Statement’), as described in a prospectus supplement dated September 3, 2019 filed with the Commission on September 4, 2015 (the “Prospectus Supplement”). The Notes will be issued pursuant to an indenture dated as of September 6, 2019, among the Issuer, the Guarantors (including RAI) and Citibank, N.A., as trustee (the “Trustee”), and Citibank, N.A., as paying agent, transfer agent, registrar and calculation agent, as supplemented by: (i) the supplemental indenture no. 1 dated as of September 6, 2019, among the Issuer, the Guarantors and the Trustee; (ii) the supplemental indenture no. 2 dated as of September 6, 2019, among the Issuer, the Guarantors and the Trustee; (iii) the supplemental indenture no. 3 dated as of September 6, 2019, among the Issuer, the Guarantors and the Trustee; and (iv) the supplemental indenture no. 4 dated as of September 6, 2019, among the Issuer, the Guarantors and the Trustee (as so supplemented, the “Indenture”). The RAI Guarantee is set forth in the Indenture.  The Issuer and the guarantors (including RAI) have entered into an Underwriting Agreement dated September 3, 2019 with BofA Securities, Inc., Barclays Capital Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and HSBC Securities (USA) Inc., for themselves and on behalf of the several Underwriters listed on Schedule I thereto.






 

In rendering the opinions set forth herein, we have examined originals or copies, certified or otherwise identified to our satisfaction, of the following documents, corporate records and other instruments: (i) the Amended and Restated Articles of Incorporation of RAI filed with the North Carolina Secretary of State on July 25, 2017; (ii) the Second Amended and Restated Bylaws of RAI; (iii) the unanimous written consent of the board of directors of RAI dated June 14, 2019, and (iv) the certificate of existence of RAI issued by the North Carolina Secretary of State dated September 5, 2019 (the “Certificate of Existence”).  As to any facts relevant to our opinions, we have relied upon a certificate from an officer of RAI.

Based upon and subject to the foregoing and the further limitations and qualifications hereinafter expressed, we are of the opinion that as of the date hereof:


1.
RAI is a corporation in existence under the laws of the State of North Carolina.


2.
RAI has the corporate power to enter into and perform its obligations under the RAI Guarantee.


3.
RAI has authorized the execution, delivery and performance of the RAI Guarantee by all necessary corporate action.

In our examination, we have assumed the legal capacity of all natural persons, the incumbency of all persons designated as officers, directors or similar representatives of legal persons, the genuineness of all signatures, the authenticity of all documents submitted to us as originals and the conformity to original documents of all documents submitted to us as certified, conformed, facsimile, electronic or photostatic copies.  We have also assumed that the parties (other than RAI) had or will have the power, corporate or other, to enter into and perform all obligations in connection with the matters addressed by this opinion, and that they have or will have duly authorized by all requisite action, corporate or other, such obligations.  We have further assumed that all parties have or will have duly executed and delivered all agreements and documents related to the matters addressed by this opinion and that the obligations thereunder are or will be valid and binding against all parties undertaking them.

The opinions set forth herein are limited to matters governed by the laws of the State of North Carolina, and no opinion is expressed herein as to the laws of any other jurisdiction.  We express no opinion concerning any matter respecting or affected by any laws other than laws that a lawyer in North Carolina exercising customary professional diligence would reasonably recognize as being directly applicable to RAI, the issuance of Notes or both.  Without limitation, we express no opinion regarding the enforceability of the RAI Guarantee.  Our opinions expressed herein are as of the date hereof, and we undertake no obligation to advise you of any changes in applicable law or any other matters that may come to our attention after the date hereof that may affect our opinions expressed herein.  In rendering our opinion numbered 1 above, we have relied solely upon the Certificate of Existence.



 

This opinion is furnished to you in connection with the filing by British American Tobacco p.l.c. of a Report of Foreign Private Issuer on Form 6-K which will be incorporated by reference into the Registration Statement.  We hereby consent to the filing of this opinion with the Commission as an exhibit to such Form 6-K.  This opinion may not be relied upon for any other purpose, except that Cravath, Swaine & Moore LLP may rely upon it in connection with the filing of its own opinion as to the Notes and related guarantees as an exhibit to such Form 6-K.

We also consent to the reference to our firm under the heading “Legal Matters” in the Prospectus Supplement.  In giving this consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the rules and regulations of the Commission.


 
Very truly yours,
   
 
/s/ Kilpatrick Townsend & Stockton LLP