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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
MARCH 4, 1999
(Date of earliest event reported)
STAR SCIENTIFIC, INC.
(formerly known as Eye Technology, Inc.)
(Exact Name of Registrant as Specified in Charter)
DELAWARE 000-15324 52-1402131
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(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
16 SOUTH MARKET STREET
PETERSBURG, VIRGINIA 23803
(Address of Principal Executive Offices, Including Zip Code)
(804) 861-0681
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(Registrant's telephone number,
including area code)
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STAR SCIENTIFIC, INC.
FORM 8-K
ITEM 5. OTHER EVENTS.
Star Scientific, Inc. ("Star") announced that its Board of
Directors had voted unanimously not to join the Master Tobacco Settlement
Agreement ("MSA") among forty-six states, several U.S. territories and a number
of tobacco manufacturers, as a Subsequent Participating Manufacturer. The MSA
and the proposed model statute that each participating state is obligated to
enact as part of the MSA, do not contain any provisions that reward or encourage
companies, like Star, that have sought to develop and promote safer tobacco
products. To rectify this inequality, the Company proposed an amendment to the
MSA that would have recognized its commitment to R&D over the past several years
and would have allowed it to continue to promote those efforts under the
grandfather provisions in the MSA that apply to Subsequent Participating
Manufacturers. The Company was advised, without receiving any adequate
explanation, that the proposed amendment, which it believed was not only fair
but magnanimous, was rejected.
After careful consideration, the Board of Directors determined
that it was not in Star's long term interest to join in the MSA without an
acceptable amendment. As a Non-Participating Manufacturer, Star, absent a
successful legal challenge, some subsequent agreement to modify the MSA or
individual state amendments to the proposed model statutes, could be required to
establish escrow funds under model statutes to be enacted by each participating
state that would be available to pay for tobacco-related judgments or
settlements, if claims are asserted by such state against Star. To date Star has
not been named as a party in any tobacco related litigation. Star is currently
assessing the impact that opting out of the MSA, and potentially having to fund
state-specific escrow accounts, will have on its ability to fully fund the
development of safer tobacco products. The Board of Directors of Star is
committed to implementing all feasible measures to achieve the development and
production of safer tobacco.
Star has pioneered the development of a high speed, patented and
economically feasible curing technology process for removing virtually all the
tobacco specific nitrosamines ("TSNA") from tobacco, as well as second hand
tobacco smoke. The Company intends to phase in this specially-treated tobacco
into its four discount cigarette brands, Gunsmoke (TM), Sport (TM), Vegas (TM)
and Mainstreet (TM), over the next 3 years. In a further effort to implement
Star's mandate to develop less toxic and safer tobacco products, the Board of
Directors ratified management's decision to put activated charcoal filters on
all of its four discount brands of cigarettes within the next 30 to 45 days.
Although this is a more costly approach to cigarette manufacturing, such
approach was highly recommended by respected scientists and physicians during
the recent Food and Drug Symposium on the development of less toxic tobacco
products held at the Georgetown University Medical Center. Professor Robert J.
DeLorenzo, M.D., Ph.D., Chairman of Star's Board, stated that he was "encouraged
by the unanimous commitment of the Board and management to adopt further
measures like the activated charcoal filter which knowledgeable scientists in
the area of tobacco toxicity believe may contribute to harm reduction."
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This report contains forward-looking statements which are made
pursuant to the Safe Harbor Provisions of the Private Securities Litigation
Reform Act of 1995. Investors are cautioned that forward-looking statements
necessarily involve risks and uncertainty which may affect the Company's
business and prospects. Forward-looking statements are based upon current
management's expectation. These statements may differ materially from actual
future events, as a result of certain risks and uncertainties including, but not
limited to, Star's decision not to join the MSA, the adoption of required state
statutes, any subsequent modification of the MSA, the development, manufacture
and commercialization of Star's proprietary process for reducing or virtually
eliminating the tobacco specific nitrosamines in the processing of tobacco leaf,
as well as the risks associated with the Company's proposed cigarette products
including potential delays in obtaining any necessary federal and/or state
regulatory approvals in the United States and/or similar approvals outside of
the United States. Further, there are always marketing risks associated with the
acceptance of products of this nature as well as general economic conditions and
other risks and uncertainties associated with potential litigation and/or
detailed from time to time in the Company's filings with the Securities and
Exchange Commission, including its Annual Report on Form 10-KSB, Quarterly
Report on Form 10-QSB and current reports on Form 8-KSB.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: March 4, 1999 STAR SCIENTIFIC, INC.
By: /s/ DR. ROBERT DELORENZO
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Dr. Robert DeLorenzo
Chairman of the Board and
Chief Executive Officer
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