company's Annual Meeting of Shareholders…

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ABOUT ALLIANCE ONE
Alliance One International is an agricultural company that delivers value-added products and services to businesses and customers, and is a trusted provider of responsibly sourced, independently verified, sustainable and traceable products and ingredients.

Alliance One's global headquarters is located in Morrisville, North Carolina.

Alliance One is a contractor, processor and supplier of Flue-Cured, Burley, Oriental, Sun-Cured, Dark Air-Cured and Dark Fire-Cured tobaccos. Our long-standing relationships with growers and industry stakeholders around the world is built off generations of history. Those relationships, combined with the expansive knowledge of our worldwide staff, ensures we have the ability to deliver a sustainable, compliant supply of tobacco that meets individual customer requirements.

Our Purchasing Network
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Alliance One purchases the vast majority of its tobacco through direct contracts with growers. Under the direct contract buying system (otherwise called the Integrated Production System), purchasers generally buy a grower's entire tobacco crop. Alliance One works closely with our customers in advance of the crop to estimate their requirements, and we use these estimates as the basis to contract tobaccos directly from growers. In this system, we assume the risk of matching the quantities and grades needed by our customers to the entire crop we must purchase under contract.

Our arrangements with growers vary from locale to locale, depending on our predictions of future supply and demand, local historical practice, and availability of capital. Under longer-term arrangements with growers, we may also finance or guarantee financing on growers' construction of curing barns.

In some tobacco-growing origins, we purchase tobacco at auction markets after receiving specific customer orders or indications of customers' upcoming needs. Our network of tobacco buyers allows us to cover the major auctions of flue-cured and burley tobacco throughout the world. These buyers are experts in differentiating hundreds of grades of tobacco based on customer specifications and preferences that take into account, among other factors, the texture, visual appearance and aroma of the tobacco.

Alliance One purchases, processes and sells a variety of tobacco types to customers around the world. In addition to our primary services, the Company's global team has decades of experience to provide agronomy support to contracted growers, helping them grow tobacco in accordance with Good Agricultural Practices and our Agricultural Labor Practices program, as well as logistical support to our customers. We are committed to providing customers with high-quality tobacco grown sustainably.

Contracting
Alliance One directly contracts with hundreds of thousands of tobacco growers around the world. Through direct contracts, we are able to provide agronomic expertise and technical guidance to help growers improve the quality and yield of their crops. Direct contracting also provides Alliance One with the insight needed to provide our customers with traceable tobacco.

While we contract with many large, commercial growers, the vast majority of our contracts are with smallholder growers. These growers often lack access to the most appropriate seed, fertilizer and crop protection agents that they need to produce the best quality and highest yielding crops. To address this need, we strategically develop grower input packages that can include seeds, fertilizer, pesticides and other products related to growing tobacco as well as food crops, if food security for the contracted grower’s family is a concern.

Agronomy
AOI_SEC-HEADER-agronomy.jpgAlliance One’s extensive team of agronomists around the world works closely contracted growers to help them produce tobacco in a sustainable and compliant manner. We are committed to responsible crop production which ensures economic viability for the grower, provides a safe working atmosphere for those involved in crop production and minimizes negative environmental impact. Our agronomists maintain frequent contact with growers prior to and during the growing and curing seasons to provide technical assistance to improve the quality and yield of the crop.

Learn more about how we are helping growers improve the quality of their crop.

Grading
The tobacco’s stalk position, color, texture, elasticity and leaf size are among the factors taken into consideration in the grading process. Alliance One grades most tobacco prior to purchasing it from the grower and then re-grades it when it arrives at our processing plants to better define the leaf characteristics.

Processing and Blending
factory.jpgWe process tobacco to meet each customer's specifications for quality, yield, chemistry, particle size, moisture content, and other characteristics. Unprocessed tobacco is a semi-perishable commodity that generally must be processed within a relatively short period of time to prevent fermentation or deterioration in quality. Accordingly, we have located our worldwide processing facilities in proximity to our principal sources of tobacco.

After processing, most of the tobacco is then blended to meet customer specifications; threshed to remove the stem from the leaf; and then further processed to produce strips of tobacco and separate out the smaller pieces, or scrap. We also sell a small amount of processed but un-threshed flue-cured and burley tobacco in loose-leaf and bundle form.

Throughout the process, our technicians use laboratory test equipment for quality control to ensure that the product meets all customer specifications.

Processed flue-cured and burley tobacco is re-dried to remove excessive moisture so that it can be held in storage for extended periods of time.

Logistics
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With decades of expertise, Alliance One's logistics teams around the world specialize in export formalities and timely shipments of all AOI tobaccos. Our experience allows us to organize shipments and accurate documentation from any AOI origin according to customer's shipping instructions.

Generally, packed tobacco is transported within the country of origin by truck and exports are moved by ship.