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                                                                    Exhibit 10.1

                              AMENDED AND RESTATED

                         EXECUTIVE EMPLOYMENT AGREEMENT

       THIS AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT (this
"Agreement") is entered into as of June 14, 2002, by and between STAR
SCIENTIFIC, INC., a Delaware corporation (the "Company"), and PAUL L. PERITO
("Executive").

Recitals

       A.  The Company is engaged in the commercialization of tobacco containing
less toxins (principally tobacco specific nitrosamines ("TSNA")), development of
less toxic tobacco products and potentially reduced-risk tobacco products, and
the licensing, manufacture and sale of very low-TSNA Star Cured(TM) tobacco and
tobacco products.

       B.  Executive is the Chairman of the Board, President and Chief Operating
Officer of the Company.

       D.  The Company and Executive are parties to a certain Executive
Employment Agreement, dated as of April 27, 1999, as amended and modified by
that certain Modification Agreement, dated as of December 1, 1999 (the "First
Modification"), and by that certain Second Modification Agreement, dated as of
October 6, 2000 (collectively, the "Original Employment Agreement").

       E.  The Company and Executive desire to modify and amend certain terms of
the Original Employment Agreement to consolidate all of the terms and conditions
of the Original Employment Agreement as so modified into a single amended and
restated employment agreement.

Agreement

       NOW, THEREFORE, in consideration of these premises, the mutual covenants
and agreements of the parties hereunder, and for other good and valuable
consideration the sufficiency and receipt of which are hereby acknowledged, the
parties hereto hereby agree as follows:

       (S) 1. Employment and Duties.

              1.1  Position. The Company hereby employs Executive, and Executive
hereby accepts employment with the Company, as President and Chief Operating
Officer of the Company.

              1.2  Duties. Executive agrees to devote his best efforts, and
shall have primary responsibility within the Company, to oversee and manage (i)
development and management of the intellectual property, including all matters
relating to science and technology related to the Company's business and all
related research and development, (ii) legal affairs of the Company,

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including all matters concerning the Company's corporate governance and
structure, securities laws and other regulatory compliance, employment laws
compliance and counseling, contract negotiation and dispute resolution, and
litigation involving the Company, (iii) financial affairs of the Company, (iv)
government relations and lobbying concerning the Company's business and affairs,
(v) public and investor relations concerning the Company's business and affairs,
and (vi) such other duties, including management and oversight functions,
consistent with the foregoing, assigned to him by the Board of Directors of the
Company (the "Board of Directors"). Executive shall perform his duties in a
trustworthy, businesslike and loyal manner.

              1.3   Authority to Select Counsel and Government and Public
Relations Professionals. Executive shall have sole authority, subject only to
confirmation and ratification by the Board of Directors, to select all outside
counsel, lobbyists and other government relations professionals, and public
relations professionals as Executive deems necessary and appropriate in the
performance of his duties hereunder.

              1.4   Reporting. Executive shall report to the Board of Directors.

              1.5   Place of Employment. The Company shall maintain and pay all
costs associated with the Company's Bethesda office which shall be the primary
office in which Executive shall perform his services hereunder, as well as the
Company's primary office for the scientific and regulatory functions of the
company.

              1.6   Change of Duties. The duties of Executive may be modified
from time to time by the mutual consent of the Company and Executive without
resulting in a rescission of this Agreement. The mutual written consent of the
Company and Executive shall constitute execution of that modification.
Notwithstanding any such change, the employment of Executive shall be construed
as continuing under this Agreement as so modified.

              1.7   Devotion of Time to Company's Business. During the Term of
this Agreement (as such term is defined in Section 1.9. hereof), Executive
agrees (i) to devote substantially all of his productive time, ability and
attention to the business of the Company during normal working hours, (ii) not
to engage in any other business duties or business pursuits whatsoever, (iii)
whether directly or indirectly, not to render any services of a commercial or
professional nature to any individual, trust, partnership, company, corporation,
business, organization, group or other entity (each, a "Person"), whether for
compensation or otherwise, without the prior written consent of the Board of
Directors, and (iv) whether directly or indirectly, not to acquire, hold or
retain more than a one percent (1%) interest in any business competing with or
similar in nature to the business of the Company or any of its Affiliates (as
such term is defined below); provided, however, the expenditure of reasonable
amounts of time for litigation support, book projects, charitable, professional
educational or professional activities or, subject to the foregoing, the making
of passive personal investments shall not be deemed a breach of this Agreement
or require the prior written consent of the Company if those activities do not
materially interfere with the services required of Executive under this
Agreement. For purposes of this Agreement, "Affiliates" shall mean any Person
that, directly or indirectly

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through one or more intermediaries, controls or is controlled by, or is under
common control with, the Company.

              1.8   Executive's Relationship With Former Law Firm. The Company
and Executive acknowledge that to accommodate Executive's expanded duties with
the Company over the past two years, Executive has terminated his Senior Counsel
business relationship with Executive's former law firm, Paul Hastings Janofsky &
Walker, LLP.

              1.9   Term. Unless sooner terminated as provided in Section 4
hereof the term of this Agreement commenced on June 15, 1999, and shall continue
until December 31, 2005 (the "Term"), and shall be renewable for successive one
(1) year terms (each, a "Renewal Term") at the option of the Company. Notice of
renewal or, if applicable, the Company's option not to renew, shall be given to
Executive in writing at least one hundred twenty (120) days prior to the end of
the Term or the applicable Renewal Term, as the case may be. The Term, together
with any Renewal Terms shall be referred to in this Agreement as the "Term of
this Agreement."

              1.10  Observance of Company Rules, Regulations and Policies.
Executive shall duly, punctually and faithfully perform and observe any and all
rules, regulations and policies which the Company may now or hereafter
reasonably establish governing the conduct of its business or its employees to
the extent such rules, regulations and policies are not in conflict with this
Agreement. Executive shall promptly provide written notice to the Board of
Directors of any such apparent conflict of which Executive becomes aware.

       (S) 2. Compensation.

              2.1   Base Salary. During the Term of this Agreement, the Company
shall pay to Executive a base salary of One Million Dollars ($1,000,000) per
year (the "Base Salary"), subject to increase from time to time in the good
faith discretion of the Board of Directors, payable in arrears on a monthly or
semi-monthly basis in accordance with the Company's standard payroll procedures
in effect at the time of payment.

              2.2   Performance Bonuses. In addition to the Base Salary, the
Company shall pay to Executive bonuses based on the Company's performance and/or
Executive's performance as follows:

                    (a)  Cash Bonus. For the performance of either of the goals
listed in Exhibit A satisfied during fiscal year 2002, the Company shall, in
addition to Base Salary and any other bonuses payable to Executive, pay to
Executive as soon as practicable after the first of such performance goals was
met, a single non-discretionary bonus equal to $300,000.00. Any bonus due
Executive hereunder shall be deemed accrued upon satisfaction of an applicable
performance goal.

                    (b)  Stock Option Bonus. The Company shall, in addition to
Base Salary and any other bonuses payable to Executive, grant to Executive an
option (the "Performance Bonus Option") to acquire 500,000 shares of the Common
Stock of the Company at an exercise price equal to the closing per share bid
price for the Company's Common Stock on

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the NASDAQ on the day immediately prior to the date of this Agreement. Such
option shall be subject to the same terms and have the same rights and
preferences as the 1999 Option (defined below in Subsection 2.3). The
Performance Bonus Option shall vest upon satisfaction during Fiscal Year 2002 of
either of the goals listed in Exhibit A. In the event neither of the goals
listed in Exhibit A are met, the Performance Bonus Option shall terminate.

               (c)  Discretionary/Special Bonuses.

                    (i)  Based upon performance of the Company as reflected by
(i) satisfaction of both of the performance goals listed in Exhibit A, attached
hereto, or (ii) by increases in the Company's net revenues for fiscal year 2002
at or above one hundred twenty-five percent (125%) of the Company's net revenues
for fiscal year 2001, or (iii) the Company's stock price during any 30
consecutive day period at or exceeding $3.90 per share, and/or (iv) the
performance of Executive during such period, the Company shall pay Executive an
additional bonus in such amount as may be determined by the Board of Directors.

                    (ii) In the event that the Company is able to effect a
global settlement with the National Association of Attorneys General ("NAAG"),
then the Company shall pay Executive an additional one-time special bonus in
such amount as may be determined by the Board of Directors.

               (d)  Establishment of Annual Bonus Performance Goals for Years
After Fiscal Year 2002. For each fiscal year after fiscal year 2002, the Company
shall propose new performance goals for purposes of determining subsequent
annual bonuses payable to Executive under Subsections 2.2(a)-(c) above, in
consultation with Executive. Upon determination of the new performance goals,
such performance goals shall be set forth in a new exhibit or exhibits to
replace Exhibit A, and the parties hereto shall execute and deliver an amendment
to this Agreement substituting such new exhibit or exhibits in lieu of Exhibit A
attached hereto. The Company and Executive will use their reasonable efforts to
try to reach agreement as to new performance goals by March 15 of each year.

          2.3  Stock Options.

               (a)  The Company shall, in addition to Base Salary and the
Performance Bonuses described above in Sections 2.1 and 2.2, grant to Executive
a fully vested option (the "2002 Option") to acquire 500,000 shares of the
Common Stock of the Company at an exercise price equal to the closing per share
bid price for the Company's Common Stock on the NASDAQ on the day immediately
prior the date of this Agreement. Such option shall be subject to the same terms
and have the same rights and preferences as the 1999 Option (defined below in
Subsection 2.3(b)). The Company, as soon as practicable after execution and
delivery of this agreement, shall deliver a written option to Executive, but
such option shall be deemed granted and shall be effective as of the date of the
execution and delivery of this Agreement.

               (b)  The Company and Executive acknowledge the entry on or about
April 27, 1999, into an agreement (the "1999 Option") granting to Executive an
option to purchase 1,000,000 share of the Common Stock of the Company. The 1999
Option is hereby

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modified such that all references to "Executive Employment Agreement therein
shall be deemed to be references to this Agreement (as the same may be modified,
amended, supplemented or replaced from time to time), with adjustments to
section references as necessary to reflect any renumbering or movement of
substantially similar sections from the Original Employment Agreement to this
Agreement. By way of example, references to Sections 4(c), 4(e) and 4(f) of the
"Executive Employment Agreement" shall be deemed to be references to Sections
4.3, 4.4 and 4.6, respectively, of this Agreement.

                    (c)  The 1999 Option, the 2002 Option, the Performance
Option (if any), and all future options for purchase of the Company's Common
Stock granted by the Company to Executive shall be referred to herein
collectively as "Executive's Stock Options."

               2.4  Stock Purchase Note. The Company shall adjust the interest
rate applicable to the promissory note, dated April 27, 1999 (the "Note"), in
the original principal amount of $2,000,000, executed and delivered by Executive
at the time of Executive's initial employment with the Company in payment for
the purchase by Executive of 2,000,000 shares of the Company's Common Stock,
from the current stated rate to the minimum applicable federal rate determined
under Section 1274(d) of the Internal Revenue Code of 1986, as amended, such
adjustment to be applicable and effective as of January 1, 2002. The Company and
Executive shall as soon as reasonably practicable after execution and delivery
of this Agreement, execute and deliver an allonge to the Note.

               2.5  Disposition Transaction. Upon the occurrence of a
Disposition Transaction, as defined below, Executive shall be entitled to
receive for each share of common stock then owned by Executive and for each
vested but unexercised share subject to Executive's Stock Option, consideration
per share of not less than, and payable on the same terms as, the consideration
per share received by Francis O'Donnell, Jr., M.D., Jonnie R. Williams, and/or
Regent Court Technologies, L.L.C., as a result of the Disposition Transaction,
and/or to participate on terms no less favorable than terms available to Francis
O'Donnell, Jr., M.D., Jonnie R. Williams, and/or Regent Court Technologies,
L.L.C., in the case of a Deposition Transaction involving issuance by the
Company of shares of its stock in an offering pursuant to a registration
statement filed with the Securities Exchange Commission. A "Disposition
Transaction" shall occur if at any time after the date hereof, the Company,
Francis O'Donnell, Jr., M.D., Jonnie R. Williams, or Regent Court Technologies,
L.L.C., or any combination thereof (a) accepts any offer to purchase thirty
percent (30%) or more of the aggregate shares of capital stock of the Company
actually or beneficially owned by Francis O'Donnell, Jr., M.D., Jonnie R.
Williams, and/or Regent Court Technologies, L.L.C., and/or (b) accepts any offer
to purchase shares of the capital stock of the Company constituting at least
fifty percent (50%) of all of the then outstanding shares of the Company, and/or
(c) accepts any offer to merge or consolidate the Company, or enter into a share
exchange, with another corporation or entity, and/or (d) accepts any offer to
sell all or substantially all of the assets of the Company, and/or (e) accepts
any other offer to enter into a transaction the result of which will be to
transfer voting control of the Company to any party other than Francis
O'Donnell, Jr., M.D., Jonnie R. Williams, and/or Regent Court Technologies,
L.L.C., and/or (f) enters into any agreements in connection with, or undertakes,
the issuance of shares of the Company's stock in an offering pursuant to a

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registration statement filed with the Securities Exchange Commission. The
Company covenants and agrees not to enter into any Disposition Transaction that
does not expressly recognize and give effect to the terms of this Section 2.5.

               2.6  Incentive Plans. In addition to all other benefits and
compensation provided by this Agreement, Executive shall be eligible to
participate in such of the Company's equity, compensation and incentive plans as
are generally available to any of the management executives of the Company,
including without limitation any executive and performance bonus or incentive
plans.

               2.7  Vacation. Executive shall be entitled to such annual
vacation time with full pay as the Company may provide in its standard policies
and practices for any other management executives; provided, however, that in
any event Executive shall be entitled to a minimum of twenty (20) days annual
paid vacation time.

               2.8  Directors and Officers Liability Insurance; Professional
Liability Insurance. Executive shall be entitled to participation in, and have
the benefit of directors and officers liability insurance providing coverage in
an amount not less than that provided by the Company for its Chief Executive
Officer and/or Chairman of the Board. The Company shall acquire and maintain
professional liability insurance for Executive insuring against any claims
against Executive arising from his performance of legal services to the Company
while acting in his capacity as an officer and employee of the Company.

               2.9  Term Life Insurance. The Company shall maintain the term
life insurance policy in the amount of $5,000,000 presently provided by the
Company with the Perito 1995 Family Trust U/A/D 53195, Robin Crawford Perito,
Trustee, as beneficiary thereunder, and shall pay the premiums due on such
policy and maintain such policy in full force and effect during the Term of this
Agreement.

               2.10 Disability Insurance. The Company shall maintain the
disability insurance policy presently provided by the Company and the Company
shall pay the premiums due on such policy and maintain such policy in full force
and effect during the Term of this Agreement.

               2.11 Automobile. The Company will furnish Executive with an
automobile equipped with a car telephone and will reimburse Executive all
reasonable costs and expenses relating to Executive's use of such automobile and
car telephone, including without limitation, amounts incurred for insurance, gas
and general maintenance and repairs.

               2.12 Mobile Telephone. Executive shall have use of a wireless
mobile telephone of his choice and the Company will be responsible for payment
of all business usage charges and all usual operational and maintenance expenses
associated with the use by Executive of such telephone.

               2.13 Club Dues. The Company shall reimburse Executive for monthly
and/or annual dues related to Executives membership in the City Club, Georgetown
Club, University Club and Kenwood Golf Club.

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               2.14 Outside Counsel for Executive. In order for Executive to
have the benefit of counsel to advise and counsel Executive with respect to the
employment issues relating to terms of this Agreement, the Company shall pay the
reasonable attorneys' fees and expenses incurred by Executive in connection with
such advise and counsel and the drafting and execution of this Agreement.

               2.15 Other Benefits. Executive shall participate in and have the
benefits of all present and future vacation, holiday, paid leave, unpaid leave,
life, accident, disability, dental, vision and health insurance plans, pension,
profit-sharing and savings plans and all other plans and benefits which the
Company now or in the future from time to time makes available to any of its
management executives.

               2.16 Withholding. The parties shall comply with all applicable
legal withholding requirements in connection with all regular monthly and/or
bi-monthly compensation payable to Executive hereunder.

      (S) 3.   Expense Reimbursement.

               3.1  General Business Expenses. The Company shall reimburse
Executive for all business travel and other out-of-pocket expenses reasonably
incurred by Executive in the course of performing his duties hereunder this
Agreement. All reimbursable expenses shall be appropriately documented and shall
be in reasonable detail and in a format and manner consistent with the Company's
expense reporting policy, as well as applicable federal and state tax record
keeping requirements.

               3.2  Professional Educational Expenses and Fees. In addition, the
Company shall reimburse Executive for (i) all reasonable expenses incurred for
continuing education courses required to maintain Executive's professional
status and bar membership as an attorney, and (ii) all reasonable professional
fees, licenses, and dues associated with Executive's professional status and bar
membership as an attorney.

      (S) 4.   Termination and Rights on Termination. This Agreement shall
terminate upon the occurrence of any of the following events:

               4.1  Death. Upon the death of Executive, in which event the
Company shall, within thirty (30) days of receiving notice of such death, pay
Executive's estate all salary and other compensation hereunder, then due and
payable and all accrued vacation pay and bonuses, if any, in each case payable
or accrued through the date of death. In addition, the Company shall pay
Executive's estate, at the time or times otherwise payable under the terms of
this Agreement, all salary and accrued benefits that would have been payable
hereunder by the Company to Executive during the one year period immediately
following Executive's death.

               4.2  Disability. Upon the mental or physical Disability (as such
term is defined below) of Executive, in which event the Company shall, within
thirty (30) days following the determination of Disability, pay Executive all
salary then due and payable and all accrued vacation pay and bonuses, if any, in
each case payable or accrued through the date of

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determination. In addition, the Company shall pay all salary and accrued
benefits that would have been payable hereunder by the Company to Executive
during the one year period immediately following Executive's disability. For
purposes of this Agreement, "Disability" shall mean a physical or mental
condition, verified by a physician designated by the Company, which prevents
Executive from carrying out one or more of the material aspects of his assigned
duties for at least ninety (90) consecutive days, or for a total of ninety (90)
days in any six (6) month period.

               4.3  Termination by the Company For Cause. Upon delivery by the
Company to Executive of a written notice terminating this Agreement for Cause
(as such term is defined below), which notice shall be supported by a reasonably
detailed statement of the relevant facts and reasons for termination, in which
event the Company shall, within thirty (30) days following such termination, pay
Executive all salary then due and payable through the date of termination.
Executive shall not be entitled to any severance compensation or any accrued
vacation pay or bonuses. For purposes of this Agreement, "Cause" shall mean:

                    (a)  Executive shall have committed an act of dishonesty,
fraud, embezzlement or theft with respect to the property, business or affairs
of the Company, in any such event in such a manner as to cause material loss,
damage or injury to the Company;

                    (b)  Executive shall have materially breached this Agreement
and such breach shall have continued for a period of twenty (20) days after
receipt of written notice from the Company specifying such breach;

                    (c)  Executive shall have been grossly negligent in the
performance of his duties hereunder, intentionally not performed or misperformed
any of such duties, or refused to abide by or comply with the directives of the
Board of Directors, which action shall have continued for a period of twenty
(20) days after receipt of written notice from the Company demanding such action
cease or be cured;

                    (d)  Executive shall have been found guilty of, or has plead
nolo contendere to, the commission of a felony offense or other crime involving
moral turpitude; or

                    (e)  Executive shall have abused alcohol or drugs (legal or
illegal) that, in the reasonable judgment of the Board of Directors, materially
impairs Executive's ability to perform his duties hereunder.

               4.4  Termination by the Company Without Cause. Thirty (30) days
after delivery by the Company to Executive of a written notice terminating
Executive's employment under this Agreement for any reason without cause, in
which event the Company shall continue to pay Executive all salary, benefits,
bonuses and other compensation that would be due hereunder through the end of
the Term of this Agreement had the Company not terminated Executive's
employment.

               4.5  Voluntary Termination by Executive. Thirty (30) days after
delivery by Executive to the Company of a written notice terminating this
Agreement for any reason without

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cause, in which event the Company shall, within thirty (30) days following the
effective date of termination, pay Executive all salary then due and payable
through the date of termination. Executive shall not be entitled to any
severance compensation or any accrued vacation pay or bonuses.

          4.6  Termination by Executive for Good Reason. Thirty (30) days after
delivery by Executive to the Company of a written notice terminating this
Agreement for Good Reason (as such term is defined below), in which event the
Company shall pay Executive such amounts in such manner as provided for in
Section 4.4 hereof. For purposes of this Agreement, "Good Reason" shall mean:

               (a)  The assignment of Executive to any duties inconsistent with,
or any adverse change in, Executive's positions, duties, responsibilities,
functions or status with the Company, or the removal of Executive from, or
failure to reelect Executive to, any of such positions; provided, however, that
a change in Executive's positions, duties, responsibilities, functions or status
that Executive shall agree to in writing shall not be an event of Good Reason or
give rise to termination under this Section 4.6;

               (b)  A reduction by the Company of Executive's Base Salary
without his written consent;

               (c)  The failure by the Company to continue in effect for
Executive any material benefit provided herein or otherwise available to any of
the management executives of the Company, including without limitation, any
retirement, pension or incentive plans, life, accident, disability or health
insurance plans, equity or cash bonus plans or savings and profit sharing plans,
or any action by the Company which would adversely affect Executive's
participation in or reduce Executive's benefits under any of such plans or
deprive Executive of any fringe benefit enjoyed by Executive; or

               (d)  Any other material breach by the Company of this Agreement
which is not cured within twenty (20) days of delivery of written notice thereof
by Executive to the Company.

          4.7  Termination by Executive upon Disposition Transaction and/or
Certain Change of Management. Thirty (30) days after delivery by Executive to
the Company of a written notice terminating this Agreement upon (a) the
consummation of a Disposition Transaction, or (b) a change in the senior
management of the Company resulting from the death or disability of Jonnie R.
Williams, or (c) a removal and replacement of a majority of the Board of
Directors, including such other persons elected to serve as directors with the
approval of the Board of Directors subsequent to the date hereof, by the
stockholders of the Company at a special meeting of the stockholders, held in
accordance with the terms of the Company's Certificate of Incorporation and
By-Laws and in accordance with all applicable laws, called by a stockholder or a
group of stockholders of the Company for such purpose, in which event the
Company shall, within thirty (30) days following the effective date of
termination, pay Executive the sum of $2,500,000. Although the parties have been
advised that 26 U.S.C. 280G is not

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applicable to any payment that may become due Executive hereunder, if 26 U.S.C.
280G is found to be applicable, then the Company shall pay any tax due by
Executive under Section 280G as a result of any payment to Executive under this
Section 4.7. It is anticipated by the parties that payment that may become due
under (b) above will be funded by one or more policies of life and/or disability
insurance to be purchased by the Company which provide for a benefit in the
amount of $2,500,000 payable to Executive as beneficiary under such policy or
policies. In the event the Company purchases such policy or policies and
thereafter maintains such policy or policies in continuous and full force and
effect during the term hereof, then Executive agrees to look solely to such
policy or policies for payment of any amount due under (b) above; provided,
however, that in the event the Company does not purchase such policy or policies
and thereafter maintain such policy or policies in continuous and full force and
effect during the term hereof, then the Company shall be directly and fully
obligated to Executive for such payment.

          4.8  Effect of Termination; Executive's Stock Options. All rights and
obligations of the Company and Executive under this Agreement shall cease as of
the effective date of termination, except that the obligations of the Company
under this Section 4 and Executive's obligations under Sections 5 and 6 hereof
shall survive such termination in accordance with their respective terms. In
addition, notwithstanding anything to the contrary contained herein or in any
agreement with respect thereto, (a) upon termination of Executive's employment
pursuant to Sections 4.3 or 4.5, all equity options, restricted equity grants
and similar rights held by Executive with respect to securities of the Company,
including without limitation Executive's Stock Options, shall, to the extent not
then fully vested, immediately terminate and revert to the Company, (b) upon
termination of Executive's employment pursuant to Section 4.4, all equity
options, restricted equity grants and similar rights held by Executive with
respect to securities of the Company, including without limitation Executive's
Stock Options, shall, remain in full force and effect and shall not be affected
by such termination, and (c) upon termination of Executive's employment pursuant
to any other provision of this Section 4, all equity options, restricted equity
grants and similar rights held by Executive with respect to securities of the
Company, including without limitation Executive's Stock Options, shall, to the
extent not then fully vested, immediately become fully vested.

          4.9  No Termination by Merger; Transfer of Assets or Dissolution. This
Agreement shall not be terminated by any dissolution of the Company resulting
from either merger or consolidation in which the Company is not the consolidated
or surviving corporation or other entity or transfer of all or substantially all
of the assets of the Company. In such event, the rights, benefits and
obligations herein shall automatically be deemed to be assigned to the surviving
or resulting corporation or other entity or to the transferee of the assets, as
the case may be, with the consent of Executive.

   (S)5.  Restriction on Competition.

          5.1  Covenant Not to Compete. During the Term of this Agreement and
for a period of twelve (12) months from the termination of this Agreement,
Executive shall not, without the prior written consent of the Company, either
directly or indirectly, for himself or on

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behalf of or in conjunction with any other Person (i) own, manage, operate,
control, be employed by, participate in, render services to, or be associated in
any manner with the ownership, management, operation or control of, any business
similar to the type of business conducted by the Company or any of its
Affiliates within any of the geographic territories in which the Company or any
of its Affiliates conducts business, (ii) solicit business of the same or
similar type being carried on by the Company or any of its Affiliates from any
Person known by Executive to be a customer of the Company or any of its
Affiliates, whether or not Executive had personal contact with such Person
during and by reason of Executive's employment with the Company, or (iii)
endeavor or attempt in any way to interfere with or induce a breach of any
contractual relationship that the Company or any of its Affiliates may have with
any employee, customer, contractor, supplier, representative or distributor.

          5.2  No Breach for Activities Deemed Not Competitive. It is further
agreed that, in the event that Executive shall cease to be employed by the
Company and enter into a business or pursue other activities that, at such time,
are not in competition with the Company or any of its Affiliates, Executive
shall not be chargeable with a violation of this Section 5 if the Company
subsequently enters the same (or a similar) competitive business or activity. In
addition, if Executive has no actual knowledge that his actions violate the
terms of this Section 5, Executive shall not be deemed to have breached the
restrictive covenants contained herein if, promptly after being notified by the
Company of such breach, Executive ceases the prohibited actions.

          5.3  Severability. The covenants in this Section 5 are severable and
separate, and the unenforceability of any specific covenant shall not affect the
provisions of any other covenant. If any provision of this Section 5 relating to
the time period or geographic area of the restrictive covenants shall be
declared by a court of competent jurisdiction to exceed the maximum time period
or geographic area, as applicable, that such court deems reasonable and
enforceable, such time period or geographic area shall be deemed to be, and
thereafter shall become, the maximum time period or largest geographic area that
such court deems reasonable and enforceable and this Agreement shall
automatically be considered to have been amended and revised to reflect such
determination.

          5.4  Fair and Reasonable. Executive has carefully read and considered
the provisions of this Section 5 and, having done so, agrees that the
restrictive covenants in this Section 5 impose a fair and reasonable restraint
on Executive and are reasonably required to protect the interests of the
Company, its Affiliates and their respective officers, directors, employees and
stockholders. It is further agreed that the Company and Executive intend that
such covenants be construed and enforced in accordance with the changing
activities, business and locations of the Company throughout the term of these
covenants.

   (S)6.  Confidential Information.

          6.1  Confidential Information. Executive hereby agrees to hold in
strict confidence and not to disclose to any third party, other than employees
and agents of the Company or persons retained by the Company to represent its
interests, any of the valuable,

                                      -11-

<PAGE>

confidential and proprietary business, financial, technical, economic, sales
and/or other types of proprietary business information relating to the Company
or any of its Affiliates (including all trade secrets) in whatever form, whether
oral, written, or electronic (collectively, the "Confidential Information"), to
which Executive has, or is given (or has had or been given), access during the
course of his employment with the Company. It is agreed that the Confidential
Information is confidential and proprietary to the Company because such
Confidential Information encompasses technical know-how, trade secrets, or
technical, financial, organizational, sales or other valuable aspects of the
business and trade of the Company or its Affiliates, including without
limitation, technologies, products, processes, plans, clients, personnel,
operations and business activities. This restriction shall not apply to any
Confidential Information that (a) becomes known generally to the public through
no fault of the Executive, (b) is required by applicable law, legal process, or
any order or mandate of a court or other governmental authority to be disclosed,
or (c) is reasonably believed by Executive, based upon the advice of legal
counsel, to be required to be disclosed in defense of a lawsuit or other legal
or administrative action brought against Executive; provided, however, that in
the case of clause (b) or (c), Executive shall give the Company reasonable
advance written notice of the Confidential Information intended to be disclosed
and the reasons and circumstances surrounding such disclosure, in order to
permit the Company to seek a protective order or other appropriate request for
confidential treatment of the applicable Confidential Information.

          6.2  Return of Company Property. In the event of termination of
Executive's employment with the Company for whatever reason or no reason, (a)
Executive agrees not to copy, make known, disclose or use, any of the
Confidential Information without the Company's prior written consent, and (b)
Executive or Executive's personal representative shall return to the Company (i)
all Confidential Information, (ii) all other records, designs, patents, business
plans, financial statements, manuals, memoranda, lists, correspondence, reports,
records, charts, advertising materials and other data or property delivered to
or compiled by Executive by or on behalf of the Company or its respective
representatives, vendors or customers that pertain to the business of the
Company or any of its Affiliates, whether in paper, electronic or other form,
and (iii) all keys, credit cards, vehicles and other property of the Company.
Executive shall not retain or cause to be retained any copies of the foregoing.
Executive hereby agrees that all of the foregoing shall be and remain the
property of the Company and the applicable Affiliates and be subject at all
times to their discretion and control.

   (S)7.  Corporate Opportunities.

          7.1  Duty to Notify. During the Term of this Agreement, in the event
that Executive shall become aware of any business opportunity related to the
business of the Company, Executive shall promptly notify the Board of Directors
of such opportunity. Executive shall not appropriate for himself or for any
other Person other than the Company (or any Affiliate) any such opportunity
unless, as to any particular opportunity, the Board of Directors fails to take
appropriate action within thirty (30) days. Executive's duty to notify the Board
of Directors and to refrain from appropriating all such opportunities for thirty
(30) days shall neither be limited by, nor shall such duty limit, the
application of the general laws relating to the fiduciary duties of an agent or
employee.

                                      -12-

<PAGE>

            7.2  Failure to Notify. In the event that Executive fails to notify
the Board of Directors or so appropriates any such opportunity without the
express written consent of the Board of Directors, Executive shall be deemed to
have violated the provisions of this Section notwithstanding the following:

                 (a)  The capacity in which Executive shall have acquired such
opportunity; or

                 (b)  The probable success in the hands of the Company of such
opportunity.

     (S) 8.  No Prior Agreements. Executive hereby represents and warrants to
the Company that the execution of this Agreement by Executive, his employment by
the Company, and the performance of his duties hereunder will not violate or be
a breach of any agreement with a former employer or any other Person. Further,
Executive agrees to indemnify and hold harmless the Company and its officers,
directors and representatives for any claim, including, but not limited to,
reasonable attorneys' fees and expenses of investigation, of any such third
party that such third party may now have or may hereafter come to have against
the Company or such other persons, based upon or arising out of any
non-competition agreement, invention, secrecy or other agreement between
Executive and such third party that was in existence as of the effective date of
this Agreement. To the extent that Executive had any oral or written employment
agreement or understanding with the Company, this Agreement shall automatically
supersede such agreement or understanding, and upon execution of this Agreement
by Executive and the Company, such prior agreement or understanding
automatically shall be deemed to have been terminated and shall be null and
void.

     (S) 9.  Representation. Executive acknowledges that he (a) has reviewed
this Agreement in its entirety, (b) has had an opportunity to obtain the advice
of separate legal counsel prior to executing this Agreement, and (c) fully
understands all provisions of this Agreement.

     (S) 10. Assignment; Binding Effect. Executive understands that he has been
selected for employment by the Company on the basis of his personal
qualifications, experience and skills. Executive agrees, therefore, that he
cannot assign or delegate all or any portion of his performance under this
Agreement. This Agreement may not be assigned or transferred by the Company
without the prior written consent of Executive. Subject to the preceding two
sentences, this Agreement shall be binding upon, inure to the benefit of, and be
enforceable by the parties hereto and their respective heirs, legal
representatives, successors, and assigns. Notwithstanding the foregoing, if
Executive accepts employment with an Affiliate, unless Executive and his new
employer agree otherwise in writing, this Agreement shall automatically be
deemed to have been assigned to such new employer (which shall thereafter be an
additional or substitute beneficiary of the covenants contained herein, as
appropriate), with the consent of Executive, such assignment shall be considered
a condition of employment by such new employer, and references to the "Company"
in this Agreement shall be deemed to refer to such new employer.

                                      -13-

<PAGE>

     (S) 11. Complete Agreement; Waiver: Amendment. Executive has no oral
representations, understandings or agreements with the Company or any of its
officers, directors or representatives covering the same subject matter as this
Agreement. This Agreement is the final, complete and exclusive statement and
expression of the agreement between the Company and Executive with respect to
the subject matter hereof and thereof, and cannot be varied, contradicted, or
supplemented by evidence of any prior or contemporaneous oral or written
agreements. This Agreement may not be later modified except by a further writing
signed by a duly authorized officer of the Company and Executive, and no term of
this Agreement may be waived except by writing signed by the party waiving the
benefit of such term.

     (S) 12. Notices. All notices, requests, demands and other communications
required or permitted to be given under this Agreement shall be in writing and
shall be given or made by personally delivering the same to or sending the same
by prepaid certified or registered mail, return receipt requested, or by
reputable overnight courier, or by facsimile machine to the party to which it is
directed at the address set out on the signature page to this Agreement, with
copies to counsel as indicated, or at such other address as such party shall
have specified by written notice to the other party as provided in this Section,
and shall be deemed to be given if delivered personally at the time of delivery,
or if sent by certified or registered mail as herein provided three (3) days
after the same shall have been posted, or if sent by reputable overnight courier
upon receipt, or if sent by facsimile machine as soon as the sender receives
written or telephonic confirmation that the facsimile was received by the
recipient and such facsimile is followed the same day by mailing by prepaid
first class mail.

     (S) 13. Severability; Headings. If any portion of this Agreement is held
invalid or inoperative, the other portions of this Agreement shall be deemed
valid and operative and, so far as is reasonable and possible, effect shall be
given to the intent manifested by the portion held invalid and inoperative. This
severability provision shall be in addition to, and not in place of, the
provisions of Section 5.3 above. The Sections headings herein are for reference
purposes only and are not intended in any way to describe, interpret, define or
limit the extent or intent of this Agreement or of any part hereof.

     (S) 14. Equitable Remedy. Because of the difficulty of measuring economic
losses to the Company as a result of a breach of the restrictive covenants set
forth in Sections 5 and 6 hereof, and because of the immediate and irreparable
damage that would be caused to the Company for which monetary damages would not
be a sufficient remedy, it is hereby agreed that in addition to all other
remedies that may be available to the Company or Executive at law or in equity,
the Company or Executive shall be entitled to specific performance and any
injunctive or other equitable relief as a remedy for any breach or threatened
breach of the aforementioned restrictive covenants.

     (S) 15. Arbitration. Any unresolved dispute or controversy arising under or
in connection with this Agreement shall be settled exclusively by arbitration
conducted in accordance with the rules of the American Arbitration Association
then in effect. The arbitrators shall not have the authority to add to, detract
from, or modify any provision hereof nor to award punitive damages to any
injured party. A decision by a majority of the arbitration panel shall be final
and binding.

                                      -14-

<PAGE>

Judgment may be entered on the arbitrators' award in any court having
jurisdiction. Notwithstanding the foregoing, the Company shall be entitled to
seek injunctive or other equitable relief, as contemplated by Section 15 hereof,
from any court of competent jurisdiction, without the need to resort to
arbitration. Should judicial proceedings be commenced to enforce or carry out
this provision or any arbitration award, the prevailing party in such
proceedings shall be entitled to reasonable attorneys' fees and costs in
addition to other relief.

     (S) 16. Governing Law. This Agreement shall in all respects be construed
according to the laws of the Commonwealth of Virginia, without regard to its
conflict of laws principles.

     (S) 17. Counterparts. This Agreement may be executed in any number of
counterparts, each of which may be executed by less than all of the parties to
this Agreement, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.

     (S) 18. Signatures. The parties shall be entitled to rely upon and enforce
a facsimile of any authorized signatures as if it were the original.

                         [Signatures on following page.]

                                      -15-

<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.

                                    COMPANY:

                                    STAR SCIENTIFIC, INC.


                                    By:_________________________[SEAL]
                                          Jonnie R. Williams
                                          Chief Executive Officer

                                    Address for Notices:

                                    801 Liberty Way
                                    Chester, Virginia 23836
                                    Attention: Mr. Jonnie R. Williams

                                    EXECUTIVE:

                                    ____________________________[SEAL]
                                    Paul L. Perito

                                    Address for Notices:

                                    7 Newlands Street
                                    Chevy Chase, Maryland 20815

                                    with a copy to:

                                    Joel L. Dahnke, Esquire
                                    Henry, Henry, O'Donnell & Dahnke, P.C.
                                    4103 Chain Bridge Road, Suite 100
                                    Fairfax, Virginia 22030

                                      -16-

<PAGE>

                                    EXHIBIT A

                      Performance Goals - Fiscal Year 2002

..    No adverse regulatory action taken by the U.S. Food and Drug Administration
     on the citizen's petitions pending as of December 18, 2001, filed by
     various health care interest groups requesting that ARIVA(TM) be
     reclassified to a "food" or a "drug" on or before July 31, 2002.

..    The Company's common stock publicly trades at a price greater than or equal
     to $2.75 per share on or before December 18, 2002.

                                      -17-