TRADEMARK LICENSE AND ROYALTY AGREEMENT

     THIS TRADEMARK LICENSE AND ROYALTY AGREEMENT (this "Agreement") is made as
of the 25th day of April, 2001 between STAR SCIENTIFIC INC., a Delaware
corporation ("Licensor") and BROWN & WILLIAMSON TOBACCO CORPORATION, a Delaware
corporation ("Licensee") (individually as "Party" and collectively the
"Parties").

                                    RECITALS

     Licensor is the owner of all right, title and interest in and to the mark
"StarCure/(TM)/" and registration thereof (the "StarCure/(TM)/ Mark") the mark
StarCure/(TM)/ Inside and registration thereof (the "StarCure/(TM)/ Inside Mark)
and has a common law mark in StarCured (the "StarCured/(TM)/ Mark")
(individually a "Mark" and collectively the "StarCure/(TM)/ Marks") (each as set
forth in Exhibit A, attached hereto).

     Licensor and Licensee are parties to an Agreement, dated April 25, 2001
(the "Restated Master Agreement"), which gives Licensee the option (and, in some
instances, the obligation) to purchase StarCured/(TM)/ Tobacco (as such term is
defined in the Restated Master Agreement) from Licensor in accordance with the
terms and conditions of the Restated Master Agreement.  Capitalized terms used
herein but not defined shall have their respective meanings set forth in the
Restated Master Agreement and the Restated Agreements.

     Licensee may desire to utilize one or more of the StarCure/(TM)/ Marks in
connection with the sale of (i) Low TSNA Cigarettes; and (ii) other cigarette
products containing StarCured/(TM)/ Tobacco which other products are hereinafter
referred to as "Tobacco Products."

                                   AGREEMENT

     NOW THEREFORE, in consideration of the foregoing and of the obligations and
promises contained in this Agreement, the Parties hereby agree as follows:

1.   License of StarCure/(TM)/ Mark and StarCure/(TM)/ Inside Mark.
     ---------------------------------------------------------

     A.  StarCure/(TM)/ Mark.  Licensor hereby grants to Licensee in the United
States an irrevocable, right and license to use, the StarCure/(TM)/ Mark and/or
the StarCured Mark in conjunction with the StarCure/(TM)/ Inside Mark or to use
the StarCure/(TM)/ Mark and/or a StarCured Mark and/or the StarCure Inside/(TM)/
Inside Mark in conjunction with another mark in connection with the
manufacturing, sub-contract manufacturing, production, marketing, promotion,
distribution and sale of the Low TSNA Cigarette product. Licensor acknowledges
that Licensee has the option of using trademarks owned by B&W in lieu of any of
the Marks on the Low TSNA Cigarette product and Licensee acknowledges that the
Royalties (as set forth in Section II.A below) for the StarCure(TM) License are
payable to Licensor regardless of whether any of the Marks is actually used on
the Low TSNA Cigarette product.
<PAGE>

     B.  StarCure/(TM)/ Inside. Licensor hereby grants to Licensee in the United
States a fully paid, royalty-free, irrevocable, exclusive right and license to
use the StarCure/(TM)/ Inside Mark or StarCured Mark in connection with the
manufacturing, sub-contract manufacturing, production, marketing, promotion,
distribution and sale of Licensee branded Tobacco Products (the "StarCure/(TM)/
Inside License").

     C.  The license hereby granted shall be exclusive to Licensee for a period
of [***] years from the date of this Agreement (the "Exclusivity Period") except
that Licensor and Star Affiliates retain the right to utilize the Marks for
their own tobacco products, and thereafter, such license shall be nonexclusive
to the Licensee for the term of this Agreement including any renewal terms.

II.  Royalty Payments.
     ----------------

     A.  License Royalties.  Licensee agrees to pay Licensor the following
royalties ("Royalties") for the trademark license granted in Section I.A.

         1. During the Test Market of the Low TSNA Cigarette and for the first
year following completion of the Test Market, the royalty payment equals Forty
cents ($0.40) per carton of the Low TSNA Cigarettes actually sold by Licensee in
such period.

         2. For each of the two years thereafter, the royalty payment shall be
calculated as follows: (i) Ten cents ($0.10) multiplied by the Base Carton Sales
for such year, plus (ii) Forty cents ($.40) multiplied by the Incremental Carton
Sales for such year.  For each year thereafter, the royalty payment shall be
only Ten cents ($0.10) multiplied by the Base Carton Sales for such year.  For
each year, the "Base Carton Sales" means the number of cartons of Low TSNA
Cigarettes actually sold by Licensee in such year up to the total number of
cartons of Low TSNA Cigarettes actually sold by Licensee in the prior year.  For
each of the two years after the period including the Test Market and the first
year following the Test Market, the "Incremental Carton Sales" equals the excess
number of cartons of Low TSNA Cigarettes actually sold by Licensee in each such
year over the Base Carton Sales.  Only one (1) royalty payment shall be due on
each carton sold hereunder.

     B.  StarCure/(TM)/ Inside License.  Licensor acknowledges that the
StarCure/(TM)/ Inside License is royalty-free; provided, however, that in the
                                               --------  -------
event that for any period after the date which is one year after the Market Test
Period, unless Licensee is using commercially reasonable efforts to promote and
actively sell the Low TSNA Cigarette in at least seven states in the United
States, Licensee shall then be obligated to pay Licensor royalties under the
StarCure/(TM)/ Inside License on the following basis:  For each such period, Ten
Cents ($0.10) multiplied by Incremental Licensee Branded Carton Sales for such
period.  For purposes of this Section II.B., "Incremental Licensee Branded
Carton Sales" equals the number of cartons of Tobacco Products sold in such
period which exceed Licensee Branded Base Carton Sales.  "Licensee Branded Base
Carton Sales" means the number of cartons of Tobacco Products actually sold by
Licensee in the twelve month period prior to the date on which Licensee ceases
using commercially reasonable efforts to promote and actively sell the Low TSNA
Cigarettes in at least seven states provided, however, that cigarettes being
sold by Licensee which do not utilize any of the marks granted by the StarCure
Inside License and which do not make any claim in the packaging, marketing or
promotional materials for such cigarette that it is a low-TSNA cigarette shall
not be included in Incremental Licensee Branded Carton Sales.

                                       2
<PAGE>

     C.  For purposes of this Section, cartons of Low TSNA Cigarettes or of
Tobacco Products shall be considered actually sold: (1)  if sold on an open
account, when delivered to the Purchaser or to a common carrier for delivery to
the Purchaser or (2) when paid for by the Purchaser, if paid in advance of
delivery. For purposes hereof, "Purchaser" shall mean a party other than B&W.

III.  Payments.
      ---------

     A.  Royalties. Until all Credit Facilities under the Restated Loan
Agreement are paid in full or otherwise discharged, Licensee in lieu of paying
royalties to Licensor will retain such royalties and offset them against the
Credit Facilities.  For each calendar quarter during a calendar year of the
Term, Licensee shall pay Licensor the Royalties (with respect to such quarter)
within thirty (30) days after the end of the calendar quarter for which such
amounts are owed by check at Licensor's principal place of business (or at such
other address as Licensor may from time to time specify in writing) or by wire
transfer in accordance with written, wire transfer instructions given to
Licensee by Licensor.  The payment obligation for Royalties accrued during the
term of this Agreement shall survive the expiration or termination of this
Agreement.

     B.  Late Fees on Delinquent Payments.  In the event Licensee does not pay
any amounts due Licensor pursuant to this Agreement, Licensee shall pay late
charges on such past due amounts at a monthly rate of one and one-half percent
(1 1/2%) (or, if less, the maximum interest rate then allowed under applicable
law).

     C.  Reporting Requirement.  Within thirty (30) days after the end of each
calendar quarter, and within sixty (60) days after the end of each calendar
year, Licensee shall prepare and deliver to Licensor an unaudited report
showing:

         (a)  the number of cartons of Low TSNA Cigarettes subject to royalty
              under paragraph II.A. and/or Tobacco Products subject to royalty
              under Paragraph II.B. sold by Licensee during such calendar
              quarter and calendar year; and

         (b)  the Royalties due pursuant to Paragraph II or offset pursuant to
              Paragraph III. A. with respect to such calendar quarter or
              calendar year.

     D.  Records.  During the term of this Agreement, and for a period of two
(2) years thereafter, Licensee shall keep accurate and complete records of all
data necessary for the computation of all Royalties due hereunder.  From time to
time upon five (5) days written notice to Licensee , Licensor or its designated
independent public accountant shall have the right at reasonable times during
normal business hours to examine the records of Licensee applicable to the
calculation of the Royalties  for the purpose of verifying the amounts owed to
Licensor and the accuracy of the reports furnished by Licensee; provided,
however, that before obtaining access to and examining such records, Licensor
shall execute and deliver, or cause its independent public accountant to execute
and deliver, a confidentiality agreement in form and

                                       3
<PAGE>

substance reasonably acceptable to Licensee regarding Licensee's records and the
information contained therein. If the records show that Licensee has
underreported the number of cartons of Low TSNA Cigarettes and/or Tobacco
Products that it sold or the amount of Royalties due by more than two percent
(2%) during any calendar quarter, Licensee shall pay all costs associated with
the examination of the records, and all additional Royalties due.

IV.  Term
     ----

     This Agreement shall be effective on the Effective Date and continue in
full force and effect until termination of the Restated Master Agreement
(including any renewals thereof) (the "Term").

V.  Quality Standards and Maintenance.
    ---------------------------------

    A.  Maintenance of Standards on Tobacco Products containing the
StarCure/(TM)/ Mark or StarCure/(TM)/ Inside Mark or the StarCured Mark.
Licensee agrees that all Tobacco Products containing any of the StarCure/(TM)/
Mark or the StarCure/(TM)/ Inside Mark or the StarCured Mark shall include
StarCured/(TM)/ Tobacco and be of equal standards as the current production of
Licensee's existing tobacco products with respect to quality and consistency.

    B.  Inspection Right.  From time to time during the Term, at Licensor's
reasonable request and at Licensor's expense, Licensee shall cooperate with
Licensor in facilitating Licensor's control over the consistency of quality of
Tobacco Products containing the StarCure/(TM)/ Mark or the StarCure/(TM)/ Inside
Mark or the StarCured Mark by permitting reasonable inspection of Licensee's
operations and furnishing random samples of requested Tobacco Products to
Licensor.

[***]All issues related to Star's Scientific Advisory Board are within the sole
domain of Star and its designees.

    D.  Use of Third Party Manufacturers.  Licensor acknowledges and agrees
that Licensee may use third parties for the manufacture or distribution of
Tobacco Products carrying the StarCure(TM) Mark or the StarCure/(TM)/ Inside
Mark or the StarCured Mark; however, Licensee's responsibilities under this
Agreement shall not be limited in any way by the use of such third parties and
all such third parties shall be advised of Licensee's responsibilities under
this Agreement.

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<PAGE>

VI.    Ownership.
       ---------

       Licensor represents and warrants that it owns or has the right to license
all intellectual property rights in and to the StarCure/(TM)/ Mark and the
StarCure/(TM)/ Inside Mark and the StarCured Mark and has the right to grant the
Trademark License and the Low TSNA License to Licensee in accordance with the
terms of this Agreement.  Licensor agrees to indemnify and hold harmless
Licensee against any claim of infringement arising out of the use by Licensee of
any of the Marks as authorized in this Agreement.

VII.   Third Party Trademark Rights.
       ----------------------------

       [***]

VIII.  Notices.
       -------

       All notices under this Agreement shall be delivered in accordance with
the Notice Provision of the Restated Master Agreement.

IX.    Successors and Assigns.
       ----------------------

       Except as otherwise expressly provided herein, this Agreement shall be
binding upon and inure to the benefit of the parties hereto, and their
respective representatives, successors and assigns. Neither party may assign any
of its rights or delegate any of its duties hereunder without the prior written
consent of the other party; provided, however, that Licensee may assign its
rights and obligations under this Agreement to a B&W Affiliate without the prior
written consent of Licensor.

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<PAGE>

X.     Amendments; Waivers.
       -------------------

       This Agreement and its provisions may not be changed, amended, modified,
or waived, except by a written instrument executed by both parties. The failure
of any party at any time or times to require performance of any provision of
this Agreement shall in no manner affect the right of such party at a later date
to enforce the same. No waiver by any party of any condition or the breach of
any provision, term, covenant, representation or warranty contained in this
Agreement, whether by conduct or otherwise, in any one or more instances shall
be deemed to be or construed as a further or continuing waiver of any such
condition or of the breach of any other provision, term, covenant,
representation or warranty of this Agreement.

XI.    Governing Law.
       -------------

       This Agreement and all questions relating to its validity,
interpretation, performance and enforcement shall be governed by and construed
in accordance with the laws of the State of Georgia, without giving effect to
principles of conflicts of laws.

XII.   Entire Agreement.
       ----------------

       This Agreement constitutes the full and entire understanding and
agreement between the Parties with regard to the subject matter hereof, and
supersedes all prior agreements, understandings, inducements or conditions,
express or implied, oral or written, relating to the subject matter hereof. The
express terms hereof control and supersede any course of performance and/or
usage of trade inconsistent with any of the terms hereof. This Agreement has
been prepared by both of the Parties hereto, and no inference of ambiguity
against the drafter of a document therefore applies against any Party hereto.
Initially capitalized terms used herein and not defined herein shall have the
meaning ascribed to them in the Restated Master Agreement.

XIII.  Counterparts.
       ------------

       This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original and all of which shall together
constitute one and the same instrument.

XIV.   Effective Date
       --------------

       The Effective Date of this Agreement shall be the actual date of
execution of this Agreement by the last Party to do so.

                            [SIGNATURE PAGE FOLLOWS]

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<PAGE>

                      SIGNATURE PAGE TO TRADEMARK LICENSE
                      -----------------------------------
                             AND ROYALTY AGREEMENT
                             ---------------------

  IN WITNESS WHEREOF, the parties have executed this Agreement as of the
Effective Date.

                                   XYZ. INC

Date: April 25, 2001
                                   [***]

                                   ABCD Corporation

                                   [***]