PROCEDURES FOR THE SALE OF FLUE-CURED TOBACCO UNDER THE DUAL (CONTRACT AND AUCTION) SYSTEM IN 2010

1.0 PREAMBLE

The dual system will be operating in 2010 for the fifth successive season. While 72% of the national tobacco crop was sold through the contract system last year, it is anticipated that up to 57% of the total 2010 crop will be sold through the contract system.

Auction sales are set to commence on Tuesday 16^th February 2010 with contract sales starting on Wednesday 17^th February 2010. The sales commence at 7:30 am and end at 1:00 pm. Bookings will be opened on 4^th February 2010 and deliveries to selling points will start on Thursday 11^th February 2010.

To ensure orderly marketing, growers producing for auction will sell their entire production through auction sales. As is usual more than one contractor could have funded a contracted grower. Accordingly, an agreed arrangement of sharing the crop amongst contractors and loan recovery from contract growers will be operated. However, the overriding principal will be that contractors will be obliged to purchase tobacco equivalent to the level of indebtedness of the grower. Thereafter transactions will be by mutual consent of the parties involved.