June 8, 2005

Mr. Lawrence Wexler
393 Carter Street
New Canaan, CT 06840

RE:  EMPLOYMENT TERMS

Dear Larry:

I am pleased to offer you the position of Chief Operating Officer ("COO") of
North Atlantic Trading Company, Inc. In this position and at this time, you will
report to me as Chief Executive Officer. This position will have the
responsibilities typical of a COO, including supervision of sales, marketing,
and manufacturing. Additional responsibilities may be added at the Company's
discretion from time to time, without written modification of this Agreement.
This position will require significant travel, primarily to our Louisville
facilities. It is expected that you will be traveling or away from your New
York/Connecticut area work station approximately 50% of business days. You will
not be required to relocate your residence from your current home.

In accordance with our discussions, I have outlined below the principal terms
and conditions of your employment. This letter, when signed by you, will
represent your Employment Agreement:


Commencement Date:          June 8, 2005. You will be employed for an indefinite
                            term, and the provisions of this Agreement shall
                            remain in effect until such time as modified by
                            mutual written agreement or until your employment is
                            severed under one of the conditions set forth below.

Base Salary:                $385,000 per annum, paid in accordance with the
                            Company's regular payroll cycle and policies.

Bonuses:                    You will be a participant in the Company's
                            Management Bonus Program under which you will be
                            eligible for a bonus of up to 50% of your then
                            current annual base salary.

                            In respect of fiscal year 2005, $50,000 of your
                            bonus will be earned if the Company's EBITDAR is
                            greater than or equal to an amount established by
                            the CEO in consultation with you, $50,000 will be
                            tied to the achievement of certain objectives
                            established by the CEO in consultation with you, the
                            achievement of which will be determined by the CEO
                            in his reasonable discretion, and the remainder of
                            your potential performance bonus will be based upon
                            the Company exceeding the EBITDAR target and
                            objectives so established, the successful strategic
                            repositioning of Company brands and the Company's
                            financial outlook for 2006, as determined by the CEO
                            in his reasonable discretion.

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                            Bonuses for any year are paid after the completion
                            of the year-end audit for such year and upon the
                            recommendation of the CEO, at his discretion, and
                            after approval by NATC's Board of Directors. In
                            general, you must remain an employee and demonstrate
                            satisfactory performance through the payment date to
                            be entitled to receive a bonus.

Stock Options:              You agree that you forfeit all stock option rights
                            granted but not vested prior to this agreement. You
                            will be issued stock options or restricted stock
                            under terms no less favorable, including dates of
                            vesting, than your existing stock option grant to
                            replace those options you have forfeited. You will
                            retain the 2,500 options in which you are currently
                            vested.

Vacations                   Four (4) weeks of paid vacation, subject to the
                            Company's policy regarding vacations. Vacation days
                            do not transfer from one year to the next and no
                            compensation is paid for unused vacation (except as
                            may be required by law upon separation from
                            employment).

Automobile:                 The Company has currently leased a vehicle for your
                            use on Company business. You may continue the use of
                            that vehicle until its lease expires. At that time,
                            in addition to the right to purchase the vehicle,
                            the Company will grant you an automobile allowance
                            of $500 per month, grossed up for state and federal
                            income taxes only. You will have no other benefits
                            related to automobile use.

Additional Benefits:        You are eligible to join the Company's group benefit
                            plans under each plan's terms and conditions, such
                            as the Company's Medical and Dental plans.

Termination:                The employment relationship may be severed at any
                            time, subject to the provisions of the Severance
                            section below, as follows:

                            Termination by the Company Without Cause. The
                            Company may terminate your employment without
                            "cause" at any time.

                            Termination for Cause. The Company may terminate
                            your employment for "cause" at any time, with or
                            without notice. For purposes of this Agreement,
                            "cause" shall mean:

                                Your failure to render required and expected
                            services in accordance with your obligations under
                            this Agreement;

                                Insubordination consisting of your continued
                            failure to take specific action which is within your
                            individual control and consistent with your status
                            as a senior manager of the Company and your duties


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                            and responsibilities after being provided not less
                            than 10 days' written notice;

                                Your material breach of any agreement with the
                            Company not cured within 10 days after written
                            notice thereof, or any material violation of any
                            policies or procedures of the Company;

                                Your commission of an act of fraud, embezzlement
                            or similar dishonest act against the Company or any
                            customer, client or business associate of the
                            Company;

                                Your conviction for any felony or crime of
                            dishonesty (as determined by a court of competent
                            jurisdiction, and not subject to further appeal);

                                Any egregious or unwarranted conduct by you that
                            discredits the Company or is detrimental to the
                            reputation or standing of the Company; or

                                Gross misconduct which is demonstrably willful
                            and deliberate on your part.

                            If you are terminated for cause, the Company shall
                            only be required to pay to you such salary and other
                            benefits as have accrued as of the date and time of
                            termination, and as may otherwise be required by
                            law.

                            Voluntary Termination by You. You may voluntarily
                            terminate your employment by giving the Company two
                            (2) weeks written notice. In such event, the Company
                            may relieve you of your duties prior to the
                            expiration of the notice period, provided that the
                            Company continues paying your salary and other
                            benefits and emoluments of employment for the
                            duration of the notice period.

                            Death of Disability. This Agreement will terminate
                            if you die or become "disabled." For purposes of
                            this Agreement, you shall be considered "disabled"
                            if you are so considered under any applicable
                            disability insurance policy maintained by the
                            Company or, if no such disability insurance policy
                            is in effect, on the date that a neutral physician
                            determines that you are or will be unable by reason
                            of illness or accident to perform your duties
                            hereunder for a continuous period of 120 days, or
                            for a period of more than 120 days in any 12 month
                            period, and that there is no objectively reasonable
                            accommodation that would allow you to perform your
                            duties hereunder.


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Severance:                  If your employment is terminated by the Company
                            without "cause," you will--upon your execution of a
                            Severance and Release Agreement in a form acceptable
                            to the Company--be paid an amount equal to your then
                            current annual compensation which will include your
                            base salary for a period of twelve months in
                            accordance with the Company's regular payroll cycle.

                            In addition, you will also receive an amount equal
                            to the average annual bonus paid to you under the
                            Company's Management Performance Bonus program for
                            the prior two calendar years. However, the bonus
                            received for 2004 will be deemed to have been
                            $100,000. If you are terminated without cause in the
                            year 2005 or prior to the bonus determination date
                            in 2006, for the purposes of this calculation, the
                            bonus for calendar 2005 will also be deemed to have
                            been $100,000 or such other amount as was actually
                            paid to you under the Company's Management
                            Performance Bonus program. Also, should you be
                            terminated without cause, you will be paid any
                            accrued or unpaid bonus to the date of termination
                            for the year in which the termination occurs, such
                            bonus to be determined by the Board, in its sole
                            discretion, after reviewing the Executive's and the
                            Company's performance for such entire year and
                            prorating any such bonus for the number of days
                            elapsed during such year prior to the date of
                            termination. All "additional benefits", automobile
                            allowances and stock option rights described in this
                            letter will expire upon termination of employment
                            for any reason, unless otherwise provided by the
                            separate written terms of those benefits.

                            For a period of twelve (12) months following the
                            date of termination of employment without cause, if
                            the Executive is eligible and elects continuation
                            coverage under the Company's "group health plan"
                            pursuant to the Consolidated Omnibus Budget
                            Reconciliation Act of 1985 ("COBRA"), the Executive
                            will continue to contribute to the Company's group
                            health plan at the same rate and based on the same
                            level of coverage as in effect with respect to the
                            Executive immediately prior to the date of
                            termination and the Company will pay the balance of
                            the Executive's cost for such continuation coverage.
                            If you obtain other employment during the twelve
                            months of severance, then these continuation
                            coverage benefits will terminate when you qualify
                            for the new employer's health benefits.

                            The Company shall deduct from severance payments
                            such taxes and other statutory amounts as would
                            normally have been deducted but for the separation
                            from employment, and shall report such payments to
                            the taxing authorities. Unless otherwise provided
                            herein or by other written agreement, the Company
                            shall cease paying and taking deductions for, other
                            benefits plans upon your separation of employment



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                            for any reason. To continue to receive severance,
                            you will be required to demonstrate reasonable
                            efforts to search for other employment.

Covenant Not to Compete
and Confidentiality:        You agree that you will not compete with the Company
                            or its affiliates for a period of one year if you
                            leave the Company, whether voluntarily or
                            involuntarily. You also agree not to disparage--at
                            any time--the Company, its employees, officers and
                            directors or its business. Further, while an
                            employee of the Company, and after any termination
                            of your employment, you will observe the strict
                            confidentiality of the information concerning the
                            Company, its trade secrets, its business and its
                            employees, officers and directors, and shall only
                            use such information to further the Company's
                            interests. "Compete," as used in this section means,
                            directly or indirectly: soliciting employees;
                            inducing employees to terminate their employment;
                            influencing any suppliers of goods or services or
                            customers to reduce or cancel any business it does
                            with the Company or its affiliates; or engaging in
                            any business that the Company or its affiliates is
                            engaged in or planned to be engaged in at the time
                            of termination.

Miscellaneous:              This Agreement shall be governed by, and construed
                            in accordance with, the laws of the Commonwealth of
                            Kentucky without regard to any state's conflict of
                            laws rules. This Agreement contains the entire
                            agreement between the parties hereto with respect to
                            the subject matter hereof. Except as otherwise
                            expressly provided herein, this Agreement may not be
                            amended orally, but only by a written agreement
                            signed by both parties. The rights and obligations
                            of Employee under this Agreement are personal and
                            may not be assigned or delegated by you. This
                            Agreement shall be binding upon, and inure to the
                            benefit of, and be enforceable by, the parties
                            hereto. If any provision of this Agreement shall be
                            invalid or unenforceable to any extent, the
                            remainder of this Agreement shall not be affected
                            thereby and this Agreement shall be enforced to the
                            greatest extent permitted by law, it being the
                            intent of the parties that the invalid provisions be
                            reformed rather than be deleted.


Please also note that the terms and conditions of your employment outlined above
are subject to (i) the execution and delivery of this Letter Agreement, and (ii)
in the case of bonuses, vacation and other benefits, the applicable plans or
policies of the Company.

Please also note that this agreement supersedes and replaces in all respects the
agreement between you and North Atlantic Trading Company, Inc., dated December
1, 2003, and that that agreement shall be no further force or effect.


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I trust that this letter adequately outlines our offer and our discussion.
However, if you have any questions or issues, please do not hesitate to call me.

We are pleased to offer you this opportunity and look forward to a long and
mutually rewarding relationship.

Sincerely,

/s/ Douglas Rosefsky

Douglas Rosefsky
Chief Executive Officer

       /s/ Lawrence Wexler
Name:  Lawrence Wexler

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