M                                                                   EXHIBIT 10.1

                      BRILLIANT DIGITAL ENTERTAINMENT, INC.

                           FOURTH AMENDED AND RESTATED
                             1996 STOCK OPTION PLAN

                             (AS OF AUGUST 21, 2004)

1.       PURPOSE OF THE PLAN.

         The purpose of this Second  Amended and Restated 1996 Stock Option Plan
(the  "Plan")  is  to  provide  incentives  and  rewards  to  selected  eligible
directors,   officers,   employees   and   consultants   of  Brilliant   Digital
Entertainment,  Inc. (the "Company") or its  subsidiaries in order to assist the
Company and its  subsidiaries  in  attracting,  retaining and  motivating  those
persons by  providing  for or  increasing  the  proprietary  interests  of those
persons in the Company,  and by associating  their interests in the Company with
those of the Company's shareholders.

2.       ADMINISTRATION OF THE PLAN.

         The Plan shall be administered by the Board of Directors of the Company
(the "Board"),  or a committee of the Board (the "Committee")  consisting of two
or  more  directors,  at  least  two of  whom  shall  be  both  a  "Non-Employee
Directors",  as  that  term  is  defined  in  Rule  16b-3(b)  of the  Rules  and
Regulations  (the "Rules") of the Securities and Exchange  Commission  under the
Securities  Exchange  Act of 1934,  as amended,  and an "outside  director"  for
purposes of Section 162(m) of the Internal Revenue Code of 1986, as amended (the
"Code") and the regulations of the Internal Revenue Service adopted  thereunder,
as such Rules and such Section and  regulations may from time to time be amended
or interpreted. Members of the Committee, if any, shall serve at the pleasure of
the Board. If administration is delegated to the Committee,  the Committee shall
have, in connection with the  administration of the Plan, the powers theretofore
possessed  by the  Board  (and  references  in  this  Plan  to the  Board  shall
thereafter be to the Committee),  subject,  however,  to such  resolutions,  not
inconsistent with the provisions of the Plan as may be adopted from time to time
by the Board.

         The Board  shall have all the  powers  vested in it by the terms of the
Plan, including exclusive authority (i) to select from among eligible directors,
officers,  employees and  consultants,  those persons to be granted "Awards" (as
defined  below) under the Plan;  (ii) to determine  the type,  size and terms of
individual  Awards  (which  need  not be  identical)  to be made to each  person
selected;  (iii) to  determine  the time  when  Awards  will be  granted  and to
establish objectives and conditions (including,  without limitation, vesting and
performance conditions),  if any, for earning Awards; (iv) to amend the terms or
conditions of any outstanding  Award,  subject to applicable legal  restrictions
and to the  consent  of the other  party to such  Award;  (v) to  determine  the
duration  and purpose of leaves of  absences  which may be granted to holders of
Awards  without  constituting  termination  of their  employment for purposes of
their Awards; (vi) to authorize any person to execute, on behalf of the Company,
any instrument required to carry out the purposes of the Plan; and (vii) to make
any  and all  other  determinations  which  it  determines  to be  necessary  or
advisable in the administration of the Plan. The Board shall have full power and
authority to administer  and  interpret the Plan and to adopt,  amend and revoke
such  rules,  regulations,   agreements,  guidelines  and  instruments  for  the


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administration  of the Plan and for the  conduct  of its  business  as the Board
deems necessary or advisable.  The Board's  interpretation  of the Plan, and all
actions taken and determinations made by the Board pursuant to the powers vested
in it  hereunder,  shall be  conclusive  and binding on all  parties  concerned,
including the Company,  its  shareholders,  any participants in the Plan and any
other employee of the Company or any of its subsidiaries.

3.       PERSONS ELIGIBLE UNDER THE PLAN.

         Any person who is a director,  officer,  employee or  consultant of the
Company,  or any of its subsidiaries (a "Participant"),  shall be eligible to be
considered for the grant of Awards under the Plan.

4.       AWARDS.

         (a)      COMMON STOCK AND DERIVATIVE SECURITY AWARDS. Awards authorized
under the Plan shall consist of any type of arrangement  with a Participant that
is not  inconsistent  with the  provisions  of the Plan and that,  by its terms,
involves  or might  involve or be made with  reference  to the  issuance  of (i)
shares of the Common  Stock,  $.001 par value per  share,  of the  Company  (the
"Common Stock") or (ii) a "derivative security" (as that term is defined in Rule
16a-1(c)  of the Rules,  as the same may be  amended  from time to time) with an
exercise or conversion price related to the Common Stock or with a value derived
from the value of the Common Stock.

         (b)      TYPES OF AWARDS.  Awards are not  restricted  to any specified
form or structure and may include,  but need not be limited to,  sales,  bonuses
and other  transfers of stock,  restricted  stock,  stock options,  reload stock
options,  stock purchase  warrants,  other rights to acquire stock or securities
convertible into or redeemable for stock,  stock  appreciation  rights,  phantom
stock,  dividend  equivalents,  performance units or performance  shares, or any
other type of Award  which the Board  shall  determine  is  consistent  with the
objectives  and  limitations  of the  Plan.  An Award  may  consist  of one such
security or benefit, or two or more of them in tandem or in the alternative.

         (c)      CONSIDERATION. Common Stock may be issued pursuant to an Award
for any lawful  consideration  as  determined by the Board,  including,  without
limitation,   a  cash  payment,   services  rendered,  or  the  cancellation  of
indebtedness.

         (d)      GUIDELINES.  The Board may adopt, amend or revoke from time to
time written policies implementing the Plan. Such policies may include, but need
not be limited to, the type,  size and term of Awards to be made to participants
and the conditions for payment of such Awards.

         (e)      TERMS AND  CONDITIONS.  Subject to the provisions of the Plan,
the Board, in its sole and absolute discretion, shall determine all of the terms
and  conditions  of each Award  granted  pursuant  to the Plan,  which terms and
conditions may include, among other things:

                  (i)      any provision  necessary for such Award to qualify as
         an incentive  stock option under Section 422 of the Code (an "Incentive
         Stock Option");

                  (ii)     a provision permitting the recipient of such Award to
         pay the purchase price of the Common Stock or other  property  issuable
         pursuant  to such Award,  or to pay such  recipient's  tax  withholding
         obligation  with  respect  to such  issuance,  in whole or in part,  by


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         delivering  previously  owned  shares of capital  stock of the  Company
         (including  "pyramiding") or other property,  or by reducing the number
         of shares of Common  Stock or the  amount of other  property  otherwise
         issuable pursuant to such Award; or

                  (iii)    a provision  conditioning or accelerating the receipt
         of benefits  pursuant to the Award,  or terminating  the Award,  either
         automatically or in the discretion of the Board, upon the occurrence of
         specified events, including, without limitation, a change of control of
         the Company,  an  acquisition  of a specified  percentage of the voting
         power of the Company,  the dissolution or liquidation of the Company, a
         sale of substantially  all of the property and assets of the Company or
         an event of the type described in Section 7 of the Plan.

         (f)      SUSPENSION OR TERMINATION OF AWARDS.  If the Company  believes
that a Participant  has committed an act of misconduct as described  below,  the
Company may suspend the  Participant's  rights under any then outstanding  Award
pending a determination by the Board. If the Board determines that a Participant
has committed an act of embezzlement,  fraud,  nonpayment of any obligation owed
to the  Company  or any  subsidiary,  breach  of  fiduciary  duty or  deliberate
disregard of the  Company's  rules  resulting  in loss,  damage or injury to the
Company, or if a Participant makes an unauthorized disclosure of trade secret or
confidential  information  of the Company,  engages in any conduct  constituting
unfair competition,  or induces any customer of the Company to breach a contract
with  the  Company,  neither  the  Participant  nor his or her  estate  shall be
entitled to exercise any rights whatsoever with respect to such Award. In making
such determination,  the Board shall act fairly and shall give the Participant a
reasonable  opportunity  to appear and present  evidence on his or her behalf to
the Board.

         (g)      MAXIMUM GRANT OF AWARDS TO ANY PARTICIPANT.  During any fiscal
year, no Participant  shall receive Awards under the Plan representing more than
fifty percent  (50%) of the total number of shares of Common Stock  reserved for
issuance pursuant to Section 5.

5.       SHARES OF COMMON STOCK SUBJECT TO THE PLAN.

         The  aggregate  number of shares of Common  Stock that may be issued or
issuable  pursuant to all Awards under the Plan (including Awards in the form of
Incentive Stock Options and Non-Statutory Options) shall not exceed an aggregate
of  35,000,000  shares of Common  Stock,  subject to  adjustment  as provided in
Section 7 of the Plan.  Shares of Common Stock  subject to the Plan may consist,
in whole or in part, of authorized and unissued shares or treasury  shares.  Any
shares of Common  Stock  subject to an Award which for any reason  expires or is
terminated  unexercised  as to such shares shall again be available for issuance
under the Plan.  For purposes of this Section 5, the aggregate  number of shares
of Common Stock that may be issued at any time pursuant to Awards  granted under
the Plan shall be reduced  by: the number of shares of Common  Stock  previously
issued  pursuant to Awards  granted under the Plan,  other than shares of Common
Stock  subsequently  reacquired  by  the  Company  pursuant  to  the  terms  and
conditions of such Awards and with respect to which the holder thereof  received
no benefits of ownership,  such as dividends; and the number of shares of Common
Stock which were otherwise  issuable  pursuant to Awards granted under this Plan
but which were  withheld by the Company as payment of the purchase  price of the
Common Stock issued pursuant to such Awards or as payment of the recipient's tax
withholding obligation with respect to such issuance.


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6.       PAYMENT OF AWARDS.

         The Board shall  determine  the extent to which Awards shall be payable
in cash, shares of Common Stock or any combination  thereof. The Board may, upon
request of a  Participant,  determine that all or a portion of a payment to that
Participant  under the Plan,  whether it is to be made in cash, shares of Common
Stock or a combination thereof,  shall be deferred.  Deferrals shall be for such
periods and upon such terms as the Board may determine in its sole discretion.

7.       DILUTION AND OTHER ADJUSTMENT.

         In the event of any  change  in the  outstanding  shares of the  Common
Stock or other securities then subject to the Plan by reason of any stock split,
reverse stock split, stock dividend,  recapitalization,  merger,  consolidation,
combination or exchange of shares or other similar  corporate  change, or if the
outstanding  securities  of the class then subject to the Plan are exchanged for
or converted into cash, property or a different kind of securities,  or if cash,
property or securities are distributed in respect of such outstanding securities
(other  than a  regular  cash  dividend)  ,  then,  unless  the  terms  of  such
transaction shall provide otherwise, such equitable adjustments shall be made in
the Plan and the Awards thereunder (including,  without limitation,  appropriate
and  proportionate  adjustments  in (i) the  number  and type of shares or other
securities or cash or other property that may be acquired  pursuant to Incentive
Stock  Options and other Awards  theretofore  granted  under the Plan,  (ii) the
maximum  number  and type of  shares  or  other  securities  that may be  issued
pursuant to Incentive  Stock Options and other Awards  thereafter  granted under
the Plan;  and (iii) the  maximum  number of  securities  with  respect to which
Awards may  thereafter be granted to any  Participant in any fiscal year) as the
Board  determines are necessary or  appropriate,  including,  if necessary,  any
adjustments  in the  maximum  number of shares  referred  to in Section 5 of the
Plan. Such  adjustments  shall be conclusive and binding for all purposes of the
Plan.

8.       MISCELLANEOUS PROVISIONS.

         (a)      DEFINITIONS. As used herein, "subsidiary" means any current or
future  corporation  which would be a "subsidiary  corporation," as that term is
defined  in Section  425 of the Code,  of the  Company;  and the term "or" means
"And/or."

         (b)      CONDITIONS  ON  ISSUANCE.   Securities  shall  not  be  issued
pursuant to Awards  unless the grant and issuance  thereof shall comply with all
relevant  provisions of law and the  requirements of any securities  exchange or
quotation system upon which any securities of the Company are listed,  and shall
be further  subject to approval of counsel for the Company  with respect to such
compliance.  Inability of the Company to obtain  authority  from any  regulatory
body having jurisdiction, which authority is determined by Company counsel to be
necessary  to the  lawful  issuance  and sale of any  security  or Award,  shall
relieve the Company of any  liability in respect of the  nonissuance  or sale of
such securities as to which requisite authority shall not have been obtained.

         (c)      RIGHTS AS SHAREHOLDER. A participant under the Plan shall have
no rights as a holder of Common Stock with respect to Awards  hereunder,  unless
and until certificates for shares of such stock are issued to the participant.


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         (d)      ASSIGNMENT  OR  TRANSFER.  Subject  to the  discretion  of the
Board,  and  except  with  respect  to  Incentive  Stock  Options  which are not
transferable  except by will or the laws of  descent  and  distribution,  Awards
under  the Plan or any  rights  or  interests  therein  shall be  assignable  or
transferable.

         (e)      AGREEMENTS.  All  Awards  granted  under  the  Plan  shall  be
evidenced  by  written  agreements  in such form and  containing  such terms and
conditions (not inconsistent with the Plan) as the Board shall from time to time
adopt.

         (f)      WITHHOLDING  TAXES. The Company shall have the right to deduct
from all Awards  hereunder  paid in cash any  federal,  state,  local or foreign
taxes  required by law to be  withheld  with  respect to such  awards and,  with
respect to awards paid in stock,  to require the  payment  (through  withholding
from the participant's salary or otherwise) of any such taxes. The obligation of
the Company to make  delivery of Awards in cash or Common Stock shall be subject
to the restrictions imposed by any and all governmental authorities.

         (g)      NO RIGHTS TO AWARD.  No Participant or other person shall have
any right to be granted an Award under the Plan. Neither the Plan nor any action
taken  hereunder  shall be construed as giving any  Participant  any right to be
retained  in the  employ  of the  Company  or any of its  subsidiaries  or shall
interfere  with or  restrict  in any way the rights of the Company or any of its
subsidiaries,  which are hereby reserved, to discharge a Participant at any time
for any reason whatsoever, with or without good cause.

         (h)      COSTS AND  EXPENSES.  The costs and expenses of  administering
the Plan shall be borne by the  Company  and not charged to any Award nor to any
Participant receiving an Award.

         (i)      FUNDING OF PLAN. The Plan shall be unfunded. The Company shall
not be required to establish  any special or separate  fund or to make any other
segregation of assets to assure the payment of any Award under the Plan.

9.       AMENDMENTS AND TERMINATION.

         (a)      AMENDMENTS.  The Board may at any time  terminate or from time
to time amend the Plan in whole or in part,  but no such action shall  adversely
affect any rights or  obligations  with respect to any Awards  theretofore  made
under the Plan. However, with the consent of the Participant affected, the Board
may amend  outstanding  agreements  evidencing Awards under the Plan in a manner
not inconsistent with the terms of the Plan.

         (b)      SHAREHOLDER  APPROVAL.  To the extent that  Section 422 of the
Code,  other  applicable law, or the rules,  regulations,  procedures or listing
agreement of any national securities exchange or quotation system, requires that
any  amendment of the Plan be approved by the  shareholders  of the Company,  no
such  amendment  shall be  effective  unless  and  until it is  approved  by the
shareholders in such a manner and to such a degree as is required.

         (c)      TERMINATION.  Unless  the Plan  shall  theretofore  have  been
terminated as above provided,  the Plan (but not the awards theretofore  granted
under  the  Plan)  shall  terminate  on and no  awards  shall be  granted  after
September 13, 2006.


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10.      EFFECTIVE DATE.

         The Plan is effective on September  13, 1996,  the date on which it was
originally  adopted by the Board of  Directors of the Company and the holders of
the majority of the Common Stock of the Company.  The Third Amended and Restated
Plan is effective as of June 20, 2002.

11.      GOVERNING LAW.

         The  corporate  law of  Delaware  shall  govern  issues  related to the
validity and issuance of Common Stock.  Otherwise,  the Plan and any  agreements
entered into thereunder shall be construed and governed by the laws of the State
of Delaware  applicable  to contracts  made within,  and to be performed  wholly
within, such state.


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