TWISTBOX ENTERTAINMENT, INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
PURSUANT TO THE
TWISTBOX ENTERTAINMENT, INC. 2006 STOCK INCENTIVE PLAN

This Non-Qualified Stock Option AGREEMENT (“Agreement”), dated as of ________
(the “Grant Date”) by and between Twistbox Entertainment, Inc., a California
corporation (the “Company”) and «Name» (the “Participant”).
 
Preliminary Statement
 
The Committee has authorized this grant of a non-qualified stock option (the
“Option”) on ________ to purchase the number of shares of the Company’s common
stock (the “Common Stock”) set forth below to the Participant, as an Eligible
Employee of the Company or a Subsidiary (collectively, the Company and all
Subsidiaries of the Company shall be referred to as the “Employer”). Unless
otherwise indicated, any capitalized term used but not defined herein shall have
the meaning ascribed to such term in the Twistbox Entertainment, Inc. 2006 Stock
Incentive Plan (the “Plan”). A copy of the Plan has been delivered to the
Participant. By signing and returning this Agreement, the Participant
acknowledges having received and read a copy of the Plan and agrees to comply
with it, this Agreement and all applicable laws and regulations.
 
Accordingly, the parties hereto agree as follows:
 
1. Tax Matters. No part of the Option granted hereby is intended to qualify as
an “incentive stock option” under Section 422 of the Internal Revenue Code of
1986, as amended.
 
2. Grant of Option. Subject in all respects to the Plan and the terms and
conditions set forth herein and therein, the Participant is hereby granted an
Option to purchase from the Company «shares» shares of Common Stock, at a price
per share of $__ (the “Option Price”).
 
3. Exercise.
 
(a) Except as set forth in subsection (b) below, the Option shall vest and
become exercisable as provided below, which shall be cumulative. To the extent
that the Option has become exercisable with respect to a number of shares of
Common Stock as provided below, the Option may thereafter be exercised by the
Participant, in whole or in part, at any time or from time to time prior to the
expiration of the Option as provided herein and in accordance with Section
6.3(d) of the Plan, including, without limitation, the filing of such written
form of exercise notice, if any, as may be required by the Committee and payment
in full of the Option Price multiplied by the number of shares of Common Stock
underlying the portion of the Option exercised. Upon expiration of the Option,
the Option shall be canceled and no longer exercisable. Exhibit A (Vesting
Schedule) indicates each date upon which the Participant shall be vested and
entitled to exercise the Option with respect to the percentage indicated beside
that date provided that the Participant has not suffered a Termination of
Employment prior to the applicable vesting date. There shall be no proportionate
or partial vesting in the periods prior to each vesting date and all vesting
shall occur only on the appropriate vesting date.
 

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(b) Upon the occurrence of an IPO or Change in Control, the Option shall
immediately become exercisable with respect to all shares of Common Stock
subject thereto.

(c) Notwithstanding the foregoing, the Participant may not exercise the Option
unless the shares of Common Stock issuable upon such exercise are then
registered under the Securities Act, or, if such shares of Common Stock are not
then so registered, the Company has determined that such exercise and issuance
would be exempt from the registration requirements of the Securities Act. The
exercise of the Option must also comply with other applicable laws and
regulations governing the Option, and the Participant may not exercise the
Option if the Company determines that such exercise would not be in material
compliance with such laws and regulations. In addition, the Participant may not
exercise the Option if the terms of the Plan do not permit the exercise of
Options at such time.

4. Option Term. The term of each Option shall be until the tenth (10th)
anniversary of the Grant Date, after which time it shall terminate, subject to
earlier termination in the event of the Participant’s Termination of Employment
as specified in Section 5 below.
 
5. Termination of Employment.
 
(a)  Subject to the terms of the Plan and this Agreement, the Option, to the
extent vested at the time of the Participant’s Termination of Employment, shall
remain exercisable as provided in Section 9.2(a) of the Plan.
 
(b) Any portion of the Option that is not vested as of the date of the
Participant’s Termination of Employment for any reason shall terminate and
expire as of the date of such Termination of Employment.
 
(c) If the Participant breaches any agreement with the Company or any of its
Subsidiaries regarding competition, confidentiality or the solicitation of
customers or employees, the Option (whether vested or unvested) and shares of
Common Stock acquired upon exercise of the Option (without compensation other
than repayment of the Option Price) shall be immediately forfeited to the
Company unless the Participant cures such breach (if curable) within 15 days of
being notified of such breach.
 
6. Restriction on Transfer of Option. No part of the Option shall be
Transferable other than by will or by the laws of descent and distribution and
during the lifetime of the Participant, may be exercised only by the Participant
or the Participant’s guardian or legal representative. In addition, the Option
shall not be assigned, negotiated, pledged or hypothecated in any way (except as
provided by law or herein), and the Option shall not be subject to execution,
attachment or similar process. Upon any attempt to Transfer the Option or in the
event of any levy upon the Option by reason of any execution, attachment or
similar process contrary to the provisions hereof, the Option shall immediately
become null and void.
 
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7. Company Call Rights; Restrictions on Transfer. The Option, and any shares of
Common Stock that the Participant acquires upon exercise of the Option, shall be
subject to the Company call rights and restrictions on transfer (including the
Company’s right of first refusal) set forth in Article XIII of the Plan. To
ensure that the shares of Common Stock issuable upon exercise of the Option are
not transferred in contravention of the terms of the Plan and this Agreement,
and to ensure compliance with other provisions of the Plan and this Agreement,
the Company may deposit the certificates evidencing the shares of Common Stock
to be issued upon the exercise of the Option with an escrow agent designated by
the Company.
 
8. Securities Representations. Upon the exercise of the Option prior to the
registration of the Common Stock subject to the Option pursuant to the
Securities Act or other applicable securities laws, the Participant shall be
deemed to acknowledge and make the representations and warranties as described
below and as otherwise may be requested by the Company for compliance with
applicable laws, and any issuances of Common Stock by the Company shall be made
in reliance upon the express representations and warranties of the Participant.
 
(a) The Participant is acquiring and will hold the shares of Common Stock for
investment for his account only and not with a view to, or for resale in
connection with, any “distribution” thereof within the meaning of the Securities
Act or other applicable securities laws.
 
(b)  The Participant has been advised that the shares of Common Stock have not
been registered under the Securities Act or other applicable securities laws, on
the ground that no distribution or public offering of the shares of Common Stock
is to be effected (it being understood, however, that the shares of Common Stock
are being issued and sold in reliance on the exemption provided under Rule 701
under the Securities Act), and that the shares of Common Stock must be held
indefinitely, unless they are subsequently registered under the applicable
securities laws or the Participant obtains an opinion of counsel (in the form
and substance satisfactory to the Company and its counsel) that registration is
not required. In connection with the foregoing, the Company is relying in part
on the Participant’s representations set forth in this Section. The Participant
further acknowledges and understands that the Company is under no obligation
hereunder to register the shares of Common Stock.
 
(c)  The Participant is aware of the adoption of Rule 144 by the Securities and
Exchange Commission under the Securities Act, which permits limited public
resale of securities acquired in a non-public offering, subject to the
satisfaction of certain conditions. The Participant acknowledges that he is
familiar with the conditions for resale set forth in Rule 144, and acknowledges
and understands that the conditions for resale set forth in Rule 144 have not
been satisfied and that the Company has no plans to satisfy these conditions in
the foreseeable future.
 
(d)  The Participant will not sell, transfer or otherwise dispose of the shares
of Common Stock in violation of the Plan, this Agreement, Securities Act (or the
rules and regulations promulgated thereunder) or under any other applicable
securities laws. The Participant agrees that he will not dispose of the Common
Stock unless and until he has complied with all requirements of this Agreement
applicable to the disposition of the shares of Common Stock.
 
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(e)  The Participant has been furnished with, and has had access to, such
information as he considers necessary or appropriate for deciding whether to
invest in the shares of Common Stock, and the Participant has had an opportunity
to ask questions and receive answers from the Company regarding the terms and
conditions of the issuance of the Common Stock.
 
(f)  The Participant is aware that his investment in the Company is a
speculative investment that has limited liquidity and is subject to the risk of
complete loss. The Participant is able, without impairing his financial
condition, to hold the Shares for an indefinite period and to suffer a complete
loss of his investment in the Common Stock.
 
9. Rights as a Stockholder. The Participant shall have no rights as a
stockholder with respect to any shares covered by the Option unless and until
the Participant has become the holder of record of the shares, and no
adjustments shall be made for dividends in cash or other property, distributions
or other rights in respect of any such shares, except as otherwise specifically
provided for in the Plan.
 
10. Provisions of Plan Control. This Agreement is subject to all the terms,
conditions and provisions of the Plan, including, without limitation, the
amendment provisions thereof, and to such rules, regulations and interpretations
relating to the Plan as may be adopted by the Committee and as may be in effect
from time to time. The Plan is incorporated herein by reference. If and to the
extent that this Agreement conflicts or is inconsistent with the terms,
conditions and provisions of the Plan, the Plan shall control, and this
Agreement shall be deemed to be modified accordingly. This Agreement contains
the entire understanding of the parties with respect to the subject matter
hereof (other than any exercise notice or other documents expressly contemplated
herein or in the Plan) and supersedes any prior agreements between the Company
and the Participant with respect to the subject matter hereof.
 
11. Notices. Any notice or communication given hereunder shall be in writing and
shall be deemed to have been duly given: (i) when delivered in person; (ii) two
(2) days after being sent by United States mail; or (iii) on the first business
day following the date of deposit if delivered by a nationally recognized
overnight delivery service, to the appropriate party at the address set forth
below (or such other address as the party shall from time to time specify):

If to the Company, to:
 
Twistbox Entertainment, Inc.
14242 Ventura Boulevard, 3rd Floor
Sherman Oaks, California 91423
Attention: Plan Administrator

If to the Participant, to the address on file with the Company.
 
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12. No Obligation to Continue Employment. This Agreement is not an agreement of
employment. This Agreement does not guarantee that the Employer will employ the
Participant for any specific time period, nor does it modify in any respect the
Employer’s right to terminate or modify the Participant’s employment or
compensation.
 
13. Agreement. As a condition to the receipt of shares of Common Stock when the
Option is exercised, the Participant shall execute and deliver an Assumption
Agreement, and to the extent required by the Committee, the Participant shall
execute and deliver a stockholder’s agreement or such other documentation which
shall set forth certain restrictions on transferability of the shares of Common
Stock acquired and such other terms or restrictions as the Committee shall from
time to time establish. Such Assumption Agreement, stockholder’s agreement or
other documentation shall apply to the Common Stock acquired under the Plan and
covered by such Assumption Agreement, stockholder’s agreement or other
documentation. The Company may require, as a condition of exercise, the
Participant to become a party to any other existing stockholder agreement or
other agreement.
 
14. 409A. NOTWITHSTANDING ANYTHING HEREIN OR IN THE PLAN TO THE CONTRARY, IF THE
COMMON STOCK DOES NOT CONSTITUTE “SERVICE RECIPIENT STOCK” FOR PURPOSES OF
SECTION 409A OF THE CODE OR IF THE OPTION OTHERWISE IS DEEMED TO BE DEFERRED
COMPENSATION UNDER SECTION 409A OF THE CODE AS A RESULT OF ANY PROPOSED,
TEMPORARY OR FINAL REGULATIONS OR ANY OTHER GUIDANCE ISSUED BY THE SECRETARY OF
THE TREASURY AND THE INTERNAL REVENUE SERVICE WITH RESPECT TO SECTION 409A OF
THE CODE, THE COMPANY SHALL BE PERMITTED TO AMEND THE PLAN AND THE OPTION TO
COMPLY WITH SECTION 409A WITHOUT THE PARTICIPANT’S CONSENT. THE COMPANY SHALL
HAVE NO LIABILITY TO THE PARTICIPANT OR OTHERWISE IF THE OPTION AND ANY AMOUNTS
PAID OR PAYABLE THEREUNDER IS SUBJECT TO SECTION 409A OF THE CODE.
 
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IN WITNESS WHEREOF, the parties have executed this Agreement on the date and
year first above written.
 
 
 
TWISTBOX ENTERTAINMENT, INC.

 
By: [sig_mandell.jpg]
Authorized Officer

 
 
«Name»
Employee [ID or Social Security] number:

I, _____________________, the spouse of the Participant, do hereby join with my
spouse in executing this Agreement and do hereby agree to be bound by all of the
terms and provisions thereof.
 
_________________________
Signature
 
 
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