sec document




                                                                    Exhibit 10.1

                          SOFTWAVE MEDIA EXCHANGE, INC.

                             2006 STOCK OPTION PLAN

   1.    PURPOSE OF THE PLAN.

         This 2006 Stock Option Plan (the  "Plan") is intended as an  incentive,
to retain in the employ of and as directors, officers, consultants, advisors and
employees  to  SoftWave  Media  Exchange,  Inc.,  a  Delaware  corporation  (the
"Company"),  and any  Subsidiary  of the Company,  within the meaning of Section
424(f) of the United  States  Internal  Revenue  Code of 1986,  as amended  (the
"Code"), persons of training,  experience and ability, to attract new directors,
officers,  consultants,  advisors and employees  whose  services are  considered
valuable,  to encourage the sense of proprietorship  and to stimulate the active
interest of such persons in the development and financial success of the Company
and its Subsidiaries.

         It is further  intended that certain  options  granted  pursuant to the
Plan shall constitute  incentive stock options within the meaning of Section 422
of the Code (the  "Incentive  Options")  while  certain  other  options  granted
pursuant to the Plan shall be  nonqualified  stock  options  (the  "Nonqualified
Options").  Incentive Options and Nonqualified  Options are hereinafter referred
to collectively as "Options."

         The Company  intends that the Plan meet the  requirements of Rule 16b-3
("Rule 16b-3") promulgated under the Securities Exchange Act of 1934, as amended
(the  "Exchange   Act")  and  that   transactions   of  the  type  specified  in
subparagraphs  (c) to (f)  inclusive of Rule 16b-3 by officers and  directors of
the Company  pursuant to the Plan will be exempt from the  operation  of Section
16(b)  of the  Exchange  Act.  Further,  the Plan is  intended  to  satisfy  the
performance-based  compensation exception to the limitation on the Company's tax
deductions  imposed by Section  162(m) of the Code with respect to those Options
for which qualification for such exception is intended. In all cases, the terms,
provisions,  conditions  and  limitations  of the Plan  shall be  construed  and
interpreted consistent with the Company's intent as stated in this Section 1.

   2.    ADMINISTRATION OF THE PLAN.

         The Plan  shall be  administered  by the  Compensation  Committee  (the
"Committee") of the Board of Directors of the Company (the "Board"), which shall
consist of three or more  directors who are  "Non-Employee  Directors"  (as such
term is defined in Rule 16b-3) and "Outside  Directors" (as such term is defined
in  Section  162(m) of the Code)  serving  at the  pleasure  of the  Board.  The
Committee,  subject  to  Sections  3, 5 and 6 hereof,  shall have full power and
authority  to  designate  recipients  of  Options,  to  determine  the terms and
conditions of the respective Option agreements (which need not be identical) and
to interpret the  provisions and supervise the  administration  of the Plan. The
Committee  shall have the  authority,  without  limitation,  to designate  which
Options  granted  under the Plan shall be  Incentive  Options and which shall be
Nonqualified  Options. To the extent any Option does not qualify as an Incentive
Option, it shall constitute a separate Nonqualified Option.




         Subject to the  provisions of the Plan, the Committee  shall  interpret
the Plan and all  Options  granted  under the Plan,  shall make such rules as it
deems necessary for the proper  administration of the Plan, shall make all other
determinations  necessary or advisable  for the  administration  of the Plan and
shall correct any defects or supply any omission or reconcile any  inconsistency
in the Plan or in any  Options  granted  under the Plan in the manner and to the
extent that the Committee  deems  desirable to carry into effect the Plan or any
Options.  The act or  determination  of a majority of the Committee shall be the
act or  determination  of the Committee and any decision  reduced to writing and
signed by all of the members of the Committee  shall be fully effective as if it
had been made by a majority at a meeting duly held. Subject to the provisions of
the Plan, any action taken or  determination  made by the Committee  pursuant to
this and the other Sections of the Plan shall be conclusive on all parties.

         In the event that for any reason the  Committee  is unable to act or if
the  Committee at the time of any grant,  award or other  acquisition  under the
Plan does not consist of two or more Non-Employee  Directors,  or if there shall
be no such  Committee,  then the Plan shall be  administered  by the Board,  and
references  herein to the  Committee  (except in the  proviso to this  sentence)
shall be deemed to be  references  to the Board,  and any such  grant,  award or
other  acquisition may be approved or ratified in any other manner  contemplated
by  subparagraph  (d) of Rule  16b-3;  provided,  however,  that  grants  to the
Company's  Chief  Executive  Officer or to any of the Company's  other four most
highly  compensated  officers that are intended to qualify as  performance-based
compensation  under  Section  162(m)  of the  Code may  only be  granted  by the
Committee.

   3.    DESIGNATION OF OPTIONEES.

         The persons  eligible for  participation  in the Plan as  recipients of
Options (the "Optionees") shall include directors, officers and employees of the
Company,  and subject to their meeting the eligibility  requirements of Rule 701
promulgated under the Securities Act of 1933, as amended (the "Securities Act"),
consultants,  vendors,  joint venture partners,  and advisors to, the Company or
any Subsidiary; provided that Incentive Options may only be granted to employees
of the Company and any Subsidiary.  In selecting  Optionees,  and in determining
the number of shares to be  covered by each  Option  granted to  Optionees,  the
Committee  may  consider  any  factors  it  deems  relevant,  including  without
limitation,  the  office or  position  held by the  Optionee  or the  Optionee's
relationship to the Company,  the Optionee's  degree of  responsibility  for and
contribution  to the growth and  success of the Company or any  Subsidiary,  the
Optionee's length of service,  promotions and potential. A Optionee who has been
granted an Option hereunder may be granted an additional  Option or Options,  if
the Committee shall so determine.

   4.    STOCK RESERVED FOR THE PLAN.

         Subject to  adjustment  as  provided  in  Section 8 hereof,  a total of
630,000  shares of the Company's  Common  Stock,  par value $0.01 per share (the
"Stock"),  shall be subject to the Plan.  The maximum  number of shares of Stock
that may be subject to Options  granted under the Plan to any  individual in any
calendar year shall not exceed 500,000 shares (subject to adjustment pursuant to
Section 7 hereof) and the method of counting  such shares  shall  conform to any
requirements  applicable to performance-based  compensation under Section 162(m)
of the Code, if qualification as performance-based compensation under Section


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162(m) of the Code is  intended.  The shares of Stock  subject to the Plan shall
consist of unissued shares,  treasury shares or previously issued shares held by
any  Subsidiary of the Company,  and such amount of shares of Stock shall be and
is hereby reserved for such purpose. Any of such shares of Stock that may remain
unsold and that are not subject to outstanding Options at the termination of the
Plan  shall  cease to be  reserved  for the  purposes  of the  Plan,  but  until
termination  of the Plan the  Company  shall at all times  reserve a  sufficient
number of  shares of Stock to meet the  requirements  of the  Plan.  Should  any
Option expire or be canceled  prior to its exercise or vesting in full or should
the number of shares of Stock to be  delivered  upon the  exercise or vesting in
full of an Option be reduced  for any  reason,  the shares of Stock  theretofore
subject to such Option may be subject to future  Options under the Plan,  except
where such reissuance is  inconsistent  with the provisions of Section 162(m) of
the Code where  qualification as  performance-based  compensation  under Section
162(m) of the Code is intended.

   5.    TERMS AND CONDITIONS OF OPTIONS.

         Options  granted  under  the Plan  shall be  subject  to the  following
conditions  and  shall  contain  such  additional  terms  and  conditions,   not
inconsistent with the terms of the Plan, as the Committee shall deem desirable:

         (a)      OPTION  PRICE.  The  purchase  price  of each  share  of Stock
purchasable  under an Incentive  Option shall be  determined by the Committee at
the time of grant,  but shall not be less than 100% of the Fair Market Value (as
defined  below)  of such  share of Stock on the  date  the  Option  is  granted;
provided,  however,  that with  respect  to an  Optionee  who,  at the time such
Incentive  Option is granted,  owns (within the meaning of Section 424(d) of the
Code) more than 10% of the total  combined  voting power of all classes of stock
of the Company or of any Subsidiary, the purchase price per share of Stock shall
be at least  110% of the Fair  Market  Value  per  share of Stock on the date of
grant.  The  purchase  price  of  each  share  of  Stock   purchasable  under  a
Nonqualified Option shall not be less than 100% of the Fair Market Value of such
share of Stock on the date the Option is granted.  The  exercise  price for each
Option  shall be subject to  adjustment  as provided  in Section 8 below.  "Fair
Market Value" means the closing price on the final trading day immediately prior
to the grant of  publicly  traded  shares of Stock on the  principal  securities
exchange  on which  shares of Stock are  listed  (if the  shares of Stock are so
listed),  or on the NASDAQ  Stock  Market (if the shares of Stock are  regularly
quoted on the NASDAQ Stock  Market),  or, if not so listed or regularly  quoted,
the mean between the closing bid and asked prices of publicly  traded  shares of
Stock in the over the counter market, or, if such bid and asked prices shall not
be  available,  as  reported  by any  nationally  recognized  quotation  service
selected  by  the  Company,  or as  determined  by  the  Committee  in a  manner
consistent with the provisions of the Code. Anything in this Section 5(a) to the
contrary  notwithstanding,  in no event shall the  purchase  price of a share of
Stock be less than the minimum price  permitted  under the rules and policies of
any national securities exchange on which the shares of Stock are listed.

         (b)      OPTION  TERM.  The term of each  Option  shall be fixed by the
Committee, but no Option shall be exercisable more than ten years after the date
such  Option is  granted  and in the case of an  Incentive  Option  granted to a
Optionee  who, at the time such  Incentive  Option is granted,  owns (within the
meaning  of  Section  424(d)  of the Code)  more than 10% of the total  combined
voting  power of all  classes of stock of the Company or of any  Subsidiary,  no
such Incentive  Option shall be exercisable  more than five years after the date
such Incentive Option is granted.



                                       3


         (c)      EXERCISABILITY.  Subject to Section 5(j) hereof, Options shall
be exercisable at such time or times and subject to such terms and conditions as
shall be determined by the  Committee at the time of grant;  provided,  however,
that in the absence of any Option vesting periods designated by the Committee at
the time of grant,  Options shall vest and become exercisable as to one-third of
the total  amount of shares  subject to the Option on each of the first,  second
and third  anniversaries  of the date of grant;  and  provided  further  that no
Options shall be exercisable until such time as any vesting limitation  required
by Section 16 of the Exchange Act, and related rules, shall be satisfied if such
limitation  shall be required for continued  validity of the exemption  provided
under Rule 16b-3(d)(3).

         Upon the occurrence of a "Change in Control" (as hereinafter  defined),
the Committee  may  accelerate  the vesting and  exercisability  of  outstanding
Options,  in  whole or in  part,  as  determined  by the  Committee  in its sole
discretion. In its sole discretion,  the Committee may also determine that, upon
the occurrence of a Change in Control,  each outstanding  Option shall terminate
within a specified number of days after notice to the Optionee  thereunder,  and
each such Optionee  shall  receive,  with respect to each share of Company Stock
subject to such  Option,  an amount equal to the excess of the Fair Market Value
of such shares  immediately  prior to such Change in Control  over the  exercise
price per share of such Option;  such amount shall be payable in cash, in one or
more  kinds  of  property  (including  the  property,  if  any,  payable  in the
transaction) or a combination  thereof,  as the Committee shall determine in its
sole discretion.

         For purposes of the Plan,  a Change in Control  shall be deemed to have
occurred if:

                  (i)    a tender offer (or series of related  offers)  shall be
         made  and  consummated  for  the  ownership  of  50%  or  more  of  the
         outstanding  voting  securities  of the Company,  unless as a result of
         such tender offer more than 50% of the outstanding voting securities of
         the surviving or resulting  corporation shall be owned in the aggregate
         by the stockholders of the Company (as of the time immediately prior to
         the  commencement  of such  offer),  any  employee  benefit plan of the
         Company or its Subsidiaries, and their affiliates;

                  (ii)   the  Company  shall  be  merged  or  consolidated  with
         another corporation, unless as a result of such merger or consolidation
         more than 50% of the outstanding  voting securities of the surviving or
         resulting   corporation   shall  be  owned  in  the  aggregate  by  the
         stockholders of the Company (as of the time  immediately  prior to such


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         transaction),   any  employee  benefit  plan  of  the  Company  or  its
         Subsidiaries, and their affiliates;

                  (iii)  the Company shall sell  substantially all of its assets
         to another corporation that is not wholly owned by the Company,  unless
         as a result of such sale more than 50% of such assets shall be owned in
         the  aggregate  by the  stockholders  of the  Company  (as of the  time
         immediately  prior to such  transaction),  any employee benefit plan of
         the Company or its Subsidiaries and their affiliates; or

                  (iv)   a Person (as defined  below) shall  acquire 50% or more
         of the outstanding  voting securities of the Company (whether directly,
         indirectly,  beneficially  or of  record),  unless  as a result of such
         acquisition more than 50% of the outstanding  voting  securities of the
         surviving or resulting  corporation  shall be owned in the aggregate by
         the  stockholders of the Company (as of the time  immediately  prior to
         the first acquisition of such securities by such Person),  any employee
         benefit plan of the Company or its Subsidiaries, and their affiliates.

         For purposes of this Section 5(c), ownership of voting securities shall
take into  account and shall  include  ownership as  determined  by applying the
provisions  of Rule  13d-3(d)(I)(i)  (as in effect on the date hereof) under the
Securities  Exchange Act of 1934, as amended (the "Exchange  Act"). In addition,
for such purposes,  "Person" shall have the meaning given in Section  3(a)(9) of
the  Exchange  Act, as modified  and used in Sections  13(d) and 14(d)  thereof;
however,  a Person shall not include (A) the Company or any of its Subsidiaries;
(B) a trustee or other fiduciary  holding  securities  under an employee benefit
plan of the Company or any of its Subsidiaries;  (C) an underwriter  temporarily
holding  securities  pursuant  to an  offering  of  such  securities;  or  (D) a
corporation owned, directly or indirectly, by the stockholders of the Company in
substantially the same proportion as their ownership of stock of the Company.

         (d)      METHOD OF EXERCISE.  Options to the extent then exercisable may
be exercised in whole or in part at any time during the option period, by giving
written  notice to the  Company  specifying  the number of shares of Stock to be
purchased,  accompanied by payment in full of the purchase price, in cash, or by
check  or such  other  instrument  as may be  acceptable  to the  Committee.  As
determined by the Committee, in its sole discretion,  at or after grant, payment
in full or in part may be made at the  election of the  Optionee (i) in the form
of Stock  owned by the  Optionee  (based on the Fair  Market  Value of the Stock
which is not the subject of any pledge or security interest, (ii) in the form of
shares of Stock withheld by the Company from the shares of Stock otherwise to be
received with such withheld  shares of Stock having a Fair Market Value equal to
the exercise  price of the Option,  or (iii) by a combination  of the foregoing,
such Fair Market  Value  determined  by  applying  the  principles  set forth in
Section 5(a),  provided that the combined value of all cash and cash equivalents
and the Fair Market Value of any shares  surrendered  to the Company is at least
equal to such exercise price and except with respect to (ii) above,  such method
of payment will not cause a disqualifying disposition of all or a portion of the
Stock received upon exercise of an Incentive  Option.  A Optionee shall have the
right to dividends and other rights of a  stockholder  with respect to shares of
Stock  purchased upon exercise of an Option at such time as the Optionee (i) has
given written notice of exercise and has paid in full for such shares,  and (ii)
has satisfied such conditions that may be imposed by the Company with respect to
the withholding of taxes.

         (e)      NON-TRANSFERABILITY OF OPTIONS; CONDITION OF EXERCISE.

                  (i)    Except as provided in Section 5(e)(ii)  hereof,  during
         the  lifetime of an Optionee,  only the  Optionee  (or, in the event of
         legal  incapacity or  incompetence,  the  Optionee's  guardian or legal
         representative)  may exercise an Option.  Except as provided in Section


                                       5


         5(e)(ii)  hereof,  no Option shall be assignable or transferable by the
         Optionee  to  whom it is  granted,  other  than by will or the  laws of
         descent and distribution.

                  (ii)   Except   pursuant   to  the   laws   of   descent   and
         distribution,  Optionee shall not sell or in any other way, directly or
         indirectly,   transfer,   assign,  distribute,   pledge,   hypothecate,
         encumber,  gift or  otherwise  alienate  or dispose  of  (collectively,
         "Transfer")  any Stock  issued  pursuant  to the  exercise of an Option
         (whether now owned or hereafter acquired pursuant to such exercise), or
         any right or interest therein, whether voluntarily or involuntarily, by
         operation of law, court order,  foreclosure,  marital property division
         or otherwise, except (a) in compliance with all applicable U.S. federal
         and state and foreign  securities laws and (b) with the written consent
         of  the  Company.  Notwithstanding  the  foregoing,  the  Optionee  may
         Transfer such Stock by gift or domestic  relations order to any "family
         member" (as that term is defined under Rule 701(c)(3) of the Securities
         Act,  as  amended  from time to time)  without  obtaining  the  written
         consent of the Company;  provided,  that (i) such Transfer  shall be in
         compliance  with all  applicable  U.S.  federal  and state and  foreign
         securities  laws;  (ii) there  shall be no  consideration  for any such
         Transfer;  and (iii) the  transferee  shall agree not to Transfer  such
         Stock except in accordance with this Section  5(e)(iii).  Any attempted
         Transfer of Stock  acquired  pursuant to the exercise of an Option that
         is not permitted in  accordance  with this Section  5(e)(iii)  shall be
         void and of no further  force and effect and shall not be registered on
         the books of the Company.  In addition,  the Company may require,  as a
         condition   to  exercise,   that  the  Optionee   agree  to  execute  a
         stockholders'  agreement in such form as may be reasonably requested by
         the Company.  The  provisions of this Section  5(e)(iii)  will be of no
         further  force or effect  upon the  earlier  of:  (x) the first date on
         which Shares are held of record by more than two hundred  (200) persons
         and the  company is filing  reports  pursuant to the  Exchange  Act, as
         amended; (y) the consummation of a firm commitment  underwritten public
         offering,  pursuant to an effective  registration  statement  under the
         Securities  Act,  as  amended  from time to time;  or (z) a sale of the
         Company to, or merger of the  Company  with,  a company  subject to the
         reporting  requirements  of the  Exchange  Act, as amended from time to
         time.

         (f)      TERMINATION  BY  DEATH.  Unless  otherwise  determined  by  the
Committee,  if any Optionee's  employment  with or service to the Company or any
Subsidiary  terminates  by  reason  of  death,  the  Option  may  thereafter  be
exercised,  to the extent then exercisable (or on such accelerated  basis as the
Committee shall determine at or after grant), by the legal representative of the
estate or by the legatee of the Optionee  under the will of the Optionee,  for a
period of one (1) year after the date of such death (or, if later,  such time as
the Option may be  exercised  pursuant  to  Section  13(d)  hereof) or until the
expiration  of the  stated  term of such  Option  as  provided  under  the Plan,
whichever period is shorter.

         (g)      TERMINATION   BY  REASON  OF   DISABILITY.   Unless   otherwise
determined by the Committee, if any Optionee's employment with or service to the
Company  or  any  Subsidiary   terminates  by  reason  of  total  and  permanent
disability, any Option held by such Optionee may thereafter be exercised, to the


                                       6


extent it was  exercisable at the time of  termination  due to disability (or on
such accelerated basis as the Committee shall determine at or after grant),  but
may not be exercised  after ninety (90) days after the date of such  termination
of employment or service (or, if later, such time as the Option may be exercised
pursuant to Section 13(d)  hereof) or the  expiration of the stated term of such
Option,  whichever period is shorter;  PROVIDED,  HOWEVER, that, if the Optionee
dies within such ninety  (90) day period,  any  unexercised  Option held by such
Optionee  shall  thereafter  be  exercisable  to  the  extent  to  which  it was
exercisable  at the time of death for a period of one (1) year after the date of
such death (or, if later,  such time as the Option may be exercised  pursuant to
Section 13(d) hereof) or for the stated term of such Option, whichever period is
shorter.

         (h)      TERMINATION   BY  REASON  OF   RETIREMENT.   Unless   otherwise
determined by the Committee, if any Optionee's employment with or service to the
Company or any Subsidiary terminates by reason of Normal or Early Retirement (as
such terms are defined  below),  any Option held by such Optionee may thereafter
be exercised to the extent it was exercisable at the time of such Retirement (or
on such  accelerated  basis as the Committee shall determine at or after grant),
but  may  not be  exercised  after  ninety  (90)  days  after  the  date of such
termination of employment or service (or, if later,  such time as the Option may
be exercised  pursuant to Section 13(d) hereof) or the  expiration of the stated
term of such Option, whichever date is earlier; provided,  however, that, if the
Optionee dies within such ninety (90) day period, any unexercised Option held by
such Optionee  shall  thereafter be  exercisable,  to the extent to which it was
exercisable at the time of death, for a period of one (1) year after the date of
such death (or, if later,  such time as the Option may be exercised  pursuant to
Section 13(d) hereof) or for the stated term of such Option, whichever period is
shorter.

         For purposes of this  paragraph  (h),  "Normal  Retirement"  shall mean
retirement from active employment with the Company or any Subsidiary on or after
the normal  retirement  date specified in the  applicable  Company or Subsidiary
pension plan or if no such pension plan,  age 65, and "Early  Retirement"  shall
mean  retirement  from  active  employment  with the  Company or any  Subsidiary
pursuant  to the  early  retirement  provisions  of the  applicable  Company  or
Subsidiary pension plan or if no such pension plan, age 55.

                  (a)    OTHER TERMINATION.  Unless otherwise  determined by the
                         Committee  and  except  as is  provided  below,  if any
                         Optionee's employment with or service to the Company or
                         any  Subsidiary  terminates  for any reason  other than
                         death,  disability or Normal or Early  Retirement,  the
                         Option  shall  thereupon  terminate,  except  that  the
                         portion of any Option that was  exercisable on the date
                         of such  termination  of  employment  or service may be
                         exercised  for the lesser of ninety (90) days after the
                         date of  termination  (or,  if  later,  such time as to
                         Option  may be  exercised  pursuant  to  Section  13(d)
                         hereof) or the  balance of such  Option's  term,  which
                         ever period is shorter if the Optionee's  employment or
                         service with the Company or Subsidiary is terminated by
                         the   Company  or   Subsidiary   without   cause,   the
                         determination  as to whether  termination was for cause
                         to  be  made  by  the  Committee.  The  transfer  of an
                         Optionee  from the employ of or service to the  Company
                         to the employ of or service  to a  Subsidiary,  or vice


                                       7


                         versa, or from one Subsidiary to another,  shall not be
                         deemed to  constitute a  termination  of  employment or
                         service for purposes of the Plan.

                  (i)    LIMIT ON VALUE OF INCENTIVE OPTION.  The aggregate Fair
Market  Value,  determined as of the date the  Incentive  Option is granted,  of
Stock for which  Incentive  Options  are  exercisable  for the first time by any
Optionee  during any calendar year under the Plan (and/or any other stock option
plans of the Company or any Subsidiary) shall not exceed $100,000.

                  (j)    INCENTIVE OPTION SHARES. A grant of an Incentive Option
under this Plan shall provide that if the Optionee makes a  disposition,  within
the  meaning  of  Section  424(c)  of  the  Code  and  regulations   promulgated
thereunder,  of any share or shares of Stock  issued to him upon  exercise of an
Incentive Option granted under the Plan within the two-year period commencing on
the day  after  the  date of the  grant of such  Incentive  Option  or  within a
one-year period commencing on the day after the date of transfer of the share or
shares to him  pursuant to the  exercise  of such  Incentive  Option,  he shall,
within 10 days after such disposition, notify the Company.

   6.    TERM OF PLAN.

         No Option  shall be granted  pursuant  to the Plan on or after the date
that is ten years from the effective date of the Plan,  but Options  theretofore
granted may extend beyond that date.

   7.    CAPITAL CHANGE OF THE COMPANY.

         In  the   event   of   any   merger,   reorganization,   consolidation,
recapitalization,  stock  dividend,  or  other  change  in  corporate  structure
affecting  the Stock,  the  Committee  shall make an  appropriate  and equitable
adjustment in the number and kind of shares reserved for issuance under the Plan
and in the number  and option  price of shares  subject to  outstanding  Options
granted  under  the Plan,  to the end that  after  such  event  each  Optionee's
proportionate   interest  shall  be  maintained  (to  the  extent  possible)  as
immediately  before the occurrence of such event.  The Committee  shall,  to the
extent  feasible,  make such other  adjustments as may be required under the tax
laws so that any  Incentive  Options  previously  granted  shall  not be  deemed
modified within the meaning of Section 424(h) of the Code.

         The  adjustments  described  above  will  be made  only  to the  extent
consistent with continued  qualification  of the Option under Section 422 of the
Code (in the case of an Incentive Option) and Section 409A of the Code.

   8.    PURCHASE FOR INVESTMENT/CONDITIONS.

         Unless the Options and shares covered by the Plan have been  registered
under the Securities Act, or the Company has determined  that such  registration
is unnecessary,  each person  exercising or receiving Options under the Plan may
be  required  by the  Company to give a  representation  in  writing  that he is
acquiring the  securities for his own account for investment and not with a view
to, or for sale in connection  with, the  distribution of any part thereof.  The


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Committee may impose any additional or further restrictions on awards of Options
as shall be determined by the Committee at the time of award.

   9.    TAXES.

         The  Company  may make  such  provisions  as it may  deem  appropriate,
consistent with applicable law, in connection with any Options granted under the
Plan  with  respect  to  the  withholding  of any  taxes  (including  income  or
employment taxes) or any other tax matters.

   10.   EFFECTIVE DATE OF PLAN.

         The Plan shall be effective on July 26, 2006; provided,  however,  that
if, and only if,  certain  options are  intended to qualify as  Incentive  Stock
Options,  the  Plan  must  subsequently  be  approved  by  majority  vote of the
Company's  stockholders  no later than July 26, 2007,  and further,  that in the
event   certain   Option   grants   hereunder   are   intended   to  qualify  as
performance-based compensation within the meaning of Section 162(m) of the Code,
the  requirements as to shareholder  approval set forth in Section 162(m) of the
Code are satisfied.

   11.   AMENDMENT AND TERMINATION.

         The Board may amend,  suspend,  or terminate  the Plan,  except that no
amendment  shall be made that would impair the rights of any Optionee  under any
Option theretofore  granted without the Optionee's  consent,  and except that no
amendment shall be made which,  without the approval of the  stockholders of the
Company would:

         (a)      materially  increase  the number of shares  that may be issued
under the Plan, except as is provided in Section 8;

         (b)      materially  increase  the benefits  accruing to the  Optionees
under the Plan;

         (c)      materially  modify  the  requirements  as to  eligibility  for
participation in the Plan;

         (d)      decrease  the exercise  price of an  Incentive  Option to less
than  100% of the  Fair  Market  Value  per  share of Stock on the date of grant
thereof or the exercise price of a Nonqualified  Option to less than 100% of the
Fair Market Value per share of Stock on the date of grant thereof; or

         (e)      extend  the term of any Option  beyond  that  provided  for in
Section 5(b).

         The  Committee  may  at  any  time  or  times  amend  the  Plan  or any
outstanding  award for any purpose which may at the time be permitted by law, or
may at any time terminate the Plan as to any further grants of awards,  provided
that (except to the extent expressly  required or permitted by the Plan) no such
amendment  will,  without  the  approval  of the  stockholders  of the  Company,
effectuate a change for which stockholder  approval is required in order for the
Plan to continue to qualify for the award of Incentive Options under Section 422
of the Code.



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         It is the intention of the Board that the Plan comply strictly with the
provisions  of  Section  409A of the Code and  Treasury  Regulations  and  other
Internal  Revenue  Service  guidance  promulgated  thereunder (the "Section 409A
Rules") and the  Committee  shall  exercise its  discretion  in granting  awards
hereunder (and the terms of such awards), accordingly. The Plan and any grant of
an award hereunder may be amended from time to time (without,  in the case of an
award, the consent of the Optionee) as may be necessary or appropriate to comply
with the Section 409A Rules.

   12.   GOVERNMENT REGULATIONS.

         The Plan,  and the grant and  exercise  of Options  hereunder,  and the
obligation of the Company to sell and deliver shares under such Options shall be
subject to all applicable laws, rules and regulations,  and to such approvals by
any  governmental  agencies,   national  securities  exchanges  and  interdealer
quotation systems as may be required.

   13.   GENERAL PROVISIONS.

         (a)      CERTIFICATES.  All  certificates for shares of Stock delivered
under  the Plan  shall  be  subject  to such  stop  transfer  orders  and  other
restrictions  as the Committee may deem advisable  under the rules,  regulations
and other  requirements  of the  Securities  and Exchange  Commission,  or other
securities  commission  having  jurisdiction,  any  applicable  Federal or state
securities  law, any stock exchange or interdealer  quotation  system upon which
the  Stock is then  listed  or traded  and the  Committee  may cause a legend or
legends to be placed on any such  certificates to make appropriate  reference to
such restrictions.

         (b)      EMPLOYMENT  MATTERS.  Neither the adoption of the Plan nor any
grant or award under the Plan shall  confer upon any Optionee who is an employee
of the Company or any  Subsidiary  any right to continued  employment or, in the
case of a Optionee who is a director,  continued service as a director, with the
Company or a  Subsidiary,  as the case may be, nor shall it interfere in any way
with the right of the Company or any  Subsidiary to terminate the  employment of
any of its  employees,  the service of any of its  directors or the retention of
any of its consultants or advisors at any time.

         (c)      LIMITATION OF LIABILITY.  No member of the  Committee,  or any
officer or employee of the Company acting on behalf of the  Committee,  shall be
personally liable for any action,  determination or interpretation taken or made
in good faith with  respect to the Plan,  and all members of the  Committee  and
each and any officer or employee of the Company acting on their behalf shall, to
the extent  permitted by law, be fully  indemnified and protected by the Company
in respect of any such action, determination or interpretation.

         (d)      REGISTRATION OF STOCK.  Notwithstanding any other provision in
the Plan,  no Option  may be  exercised  unless and until the Stock to be issued
upon the  exercise  thereof has been  registered  under the  Securities  Act and
applicable  state  securities  laws,  or are,  in the  opinion of counsel to the
Company,  exempt from such registration in the United States.  The Company shall
not be under any  obligation  to  register  under  applicable  federal  or state
securities  laws any Stock to be issued upon the  exercise of an Option  granted
hereunder in order to permit the exercise of an Option and the issuance and sale
of the Stock  subject  to such  Option,  although  the  Company  may in its sole


                                       10


discretion  register such Stock at such time as the Company shall determine.  If
the Company  chooses to comply with such an  exemption  from  registration,  the
Stock issued  under the Plan may, at the  direction  of the  Committee,  bear an
appropriate  restrictive  legend restricting the transfer or pledge of the Stock
represented  thereby,  and the Committee may also give appropriate stop transfer
instructions with respect to such Stock to the Company's transfer agent.

   14.   NON-UNIFORM DETERMINATIONS.

         The  Committee's  determinations  under  the Plan,  including,  without
limitation,  (i) the determination of the Optionees to receive awards,  (ii) the
form,  amount and timing of such awards,  (iii) the terms and provisions of such
awards and (ii) the agreements  evidencing the same, need not be uniform and may
be made by it selectively  among  Optionees who receive,  or who are eligible to
receive,  awards under the Plan,  whether or not such  Optionees  are  similarly
situated.

   15.   GOVERNING LAW.

         The  validity,  construction,  and effect of the Plan and any rules and
regulations  relating to the Plan shall be  determined  in  accordance  with the
internal laws of the State of Delaware,  without  giving effect to principles of
conflicts of laws, and applicable federal law.

                                      SoftWave Media Exchange, Inc.
                                      July 26, 2006


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