Via UPS Overnight
April 30, 2007
Teresa M. Riggs
BATUS Japan, Inc.
103 Foulk Road, Suite 117
Re: Contract Manufacturing Agreement dated 30th July 2004 by and between R. J.
Reynolds Tobacco Company and BATUS Japan, Inc.; Section 3.2 Invoices Amendment
R. J. Reynolds Tobacco Company (RJRTC) recently has made a shift in the shipment of product
for BATUS Japan, Inc. (BATUS Japan) with regard to the Contract Manufacturing Agreement (the
Agreement) referenced above. Shipments of product by RJRTC to BATUS typically have been made from
the west coast of the United States. RJRTC and BATUS Japan deem it mutually beneficial for
shipments to be made with a mix of routes from the east and west coasts of the United States. As a
result of this change, a majority of shipments are made through the east coast, and RJRTC and BATUS
Japan agreement that typical title passage of product shipped now occurs 10 to 14 days sooner than
those contemplated by the guidelines originally documented in the Agreement. In light of this,
RJRTC and BATUS Japan agree to amend Section 3.2 of the Agreement by replacing Section 3.2 with the
3.2 Invoices. RJRTC shall invoice BATUS Japan (or, where applicable RFEBV) monthly
for Products shipped by RJRTC during the applicable month. BATUS Japans obligation to
make payment shall accrue once title and risk of loss to the applicable Products pass to
BATUS Japan. Such invoices shall be due and payable by BATUS Japan (or RFEBV) by 9 days
after the last calendar day of the month following the month of shipment from RJRTCs
The terms of amended Section 3.2 shall be reviewed on a periodic basis by both parties to
insure relevance to the current transportation model, and amended to reflect a payment schedule
that is fair to both parties.
All other terms and conditions of the Agreement that are in place as of this letterhead date
and not expressly amended by this letter shall remain in full force and effect.
If the foregoing accurately sets forth our understanding, please indicate by executing and
returning two originals.
Agreed and accepted:
R. J. REYNOLDS TOBACCO COMPANY
Title: Executive Vice President Operations