CENTERSTAGING
      CORP. 

     

    OPTION
      CERTIFICATE

    (Non-Qualified
      Stock Option)

     

    


    THIS
      IS
      TO CERTIFY that CenterStaging Corp., a Delaware corporation (the “Company”),
      has
      granted to the officer named below (“Optionee”)
      a
      non-qualified stock option (the “Option”)
      to
      purchase shares of the Company’s common stock (the “Common
      Stock”)
      upon
      the terms and conditions set forth below and in the attached Stock Option
      Agreement:

     

    
      	
              Name
                of Optionee:

            	
              Paul
                Schmidman

            
	 	 
	
              Number
                of Option Shares:

            	
              3,000,000

            
	 	 
	
              Exercise
                Price:

            	
              $1.25
                per share

            
	 	 
	
              Date
                of Grant:

            	
              March
                13, 2007

            
	 	 
	
              Option
                Expiration Date:

            	
              March
                12, 2017

            


    

    


    Exercise
      Schedule:
      The
      Option shall become exercisable (“vest”) as follows:

     

    
      	
              Date

            	
              Number
                of Shares

            
	
              March
                13, 2007

            	
              1,500,000

            
	
              March
                13, 2008

            	
              1,500,000

            


    

    


    IN
      WITNESS WHEREOF, the Company has granted to Optionee the Option as of the Date
      of Grant set forth above.

    


    
      	
              OPTIONEE

               

               

              /s/
                Paul Schmidman    

              Paul
                Schmidman

            	
              CENTERSTAGING
                CORP.

               

               

              By /s/
                Howard Livingston 

              Howard
                Livingston, Chief Financial Officer

            


    

    


    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    STOCK
      OPTION AGREEMENT

    (Non-Qualified
      Stock Option)

     

    


    This
      STOCK OPTION AGREEMENT (this “Agreement”)
      is
      made and entered into as of the Date of Grant set forth in the Option
      Certificate to which this Agreement is attached (the “Certificate”)
      by and
      between CenterStaging Corp., a Delaware corporation (the “Company”),
      and
      the optionee (the “Optionee”)
      named
      in the Certificate. 

     

    It
      is
      intended that the option not
      qualify
      as an “incentive stock option” within the meaning of Section 422 of the Internal
      Revenue Code of 1986, as amended from time to time (the “Code”).
      

     

    The
      Company and Optionee agree as follows:

     

    1. Grant
      of Option.
      The
      Company hereby grants to Optionee, upon the terms and subject to the conditions
      set forth in this Agreement, an Option (the “Option”)
      to
      purchase all or any portion of that number of shares of Common Stock set forth
      in the Certificate (the “Option
      Shares”),
      at
      the exercise price set forth in the Certificate (the “Exercise
      Price”).

     

    2. Vesting

     

    2.1. The
      Option shall “vest” and become exercisable in installments upon and after the
      dates set forth under the caption “Exercise
      Schedule”
in
      the
      Certificate. The installments shall be cumulative; i.e.,
      the
      Option may be exercised, as to any or all Shares covered by an installment,
      at
      any time or times after the installment first becomes exercisable and until
      expiration or termination of the Option.

     

    2.2. No
      vesting shall occur after the Employment Termination Date (as defined in Section
      4.2 of this Agreement).

     

    2.3. Notwithstanding
      anything to the contrary contained in this Option Agreement, the Option may
      not
      be exercised, in whole or in part, unless and until any then-applicable
      requirements of all state and federal laws and regulatory agencies shall have
      been fully complied with to the satisfaction of the Company and its
      counsel.

     

    3. Exercise
      of the Option.
      

     

    3.1. The
      Option may be exercised, in whole or in part, only by delivery to the Company
      of:

     

    3.1.1 written
      notice of the exercise of the Option in form identical to Exhibit
      “A”
      attached
      to this Agreement stating the number of Option Shares being purchased (the
      “Purchased
      Shares”);
      

     

    3.1.2 payment
      of the Exercise Price in cash, check or wire transfer; and 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    3.1.3 if
      the
      issuance of the Purchased Shares has not been registered under the Securities
      Act of 1933, as amended (the “Securities
      Act”),
      an
      investment letter, in form and substance satisfactory to the Company, executed
      by the Optionee containing such representations, warranties and agreements
      as
      the Company may request to permit the Company to issue the Purchased Shares
      without registration under the Securities Act.

     

    3.2. Following
      receipt of the exercise notice, any other applicable documents and the payment
      referred to above, the Company shall, within 30 days, cause certificates
      representing the Purchased Shares to be delivered to Optionee either at
      Optionee’s address set forth in the records of the Company or at such other
      address as Optionee may designate in writing to the Company; provided, however,
      that
      the Company shall not be obligated to issue a fraction or fractions of a share
      otherwise issuable upon exercise of the Option, and may pay to Optionee, in
      cash
      or cash equivalent, the fair market value of any such fraction or fractions
      of a
      share as of the date of exercise.

     

    3.3. If
      requested by the Company, Optionee shall also deliver this Agreement to the
      Secretary of the Company, who shall endorse hereon a notation of the exercise
      and return this Agreement to Optionee. The date of exercise of an Option that
      is
      validly exercised shall be deemed to be the date on which there shall have
      been
      delivered to the Company the instruments referred to in this Section 3.


     

    3.4. As
      a
      condition to exercise of this Option, the Company may require Optionee to pay
      over to the Company all applicable federal, state and local taxes which the
      Company is required to withhold with respect to the exercise of this Option.
      At
      the discretion of the Company and upon the request of Optionee, the minimum
      statutory withholding tax requirements may be satisfied by the withholding
      of
      Shares otherwise issuable to Optionee upon the exercise of this
      Option.

     

    4. Termination
      of Option

     

    4.1. The
      Option shall terminate and expire upon the earliest to occur of: (i) the Option
      Expiration Date set forth in the Option Certificate; (ii) the Termination Date;
      or (iii) a Corporate Transaction unless specified otherwise by the Company
      in
      accordance with Section 6 of this Agreement. Following the Employment
      Termination Date, and prior to the Termination Date, the Option may be exercised
      only to the extent vested as of the date of the Employment Termination
      Date.

     

    4.2. For
      purposes of this Agreement:

     

    4.2.1 “Employment
      Termination Date”
shall
      mean the date Optionee is no longer a director, employee or consultant to the
      Company and its subsidiaries (the “Company
      Group”).
      As
      long as Optionee is at least one of employee, director or consultant, the
      Employment Termination Date shall not be deemed to have occurred. For example,
      if Optionee is an employee and a director, the termination of employment as
      an
      employee while remaining a director shall not establish an Employment
      Termination Date (which would only be established if and when Optionee ceases
      to
      be a director). Optionee’s employment shall not be deemed to terminate by reason
      of a transfer among members of the Company Group, or sick leave, military leave
      or other leave of absence approved by the Company, if the period of any such
      leave does not exceed 90 days or, if longer, if Optionee’s right to reemployment
      by the Company Group is guaranteed either contractually or by
      statute.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    4.2.2 “Termination
      Date”
shall
      be: (a) the date 90 days following the Employment Termination Date unless
      Optionee’s employment is terminated as a result of the death or disability of
      Optionee or For Cause; or (b) upon the Employment Termination Date if Optionee’s
      employment is terminated For Cause; or (c) one year following the Employment
      Termination Date if the Employment Termination Date occurs as a result of the
      death or disability of Optionee. 

     

    4.2.3 “For
      Cause”
shall
      mean Optionee’s loss of employment, directorship or consulting engagement by any
      member of the Company Group due to Optionee’s (a) willful breach or habitual
      neglect or continued incapacity to perform Optionee’s required duties, (b)
      commission of acts of dishonesty, fraud, misrepresentation or other acts of
      moral turpitude in connection with Optionee’s services to any member of the
      Company Group or which in the determination of the Company would prevent the
      effective performance of Optionee’s duties or (c) termination for cause under
      any employment or consulting agreement between the Company and Optionee (as
      For
      Cause is defined therein).

     

    5. Changes
      in Capital Structure

     

    5.1. If
      outstanding shares of the Common Stock shall be subdivided into a greater number
      of shares, or a dividend in Common Stock shall be paid in respect of the Common
      Stock, the Exercise Price of the Option in effect immediately prior to such
      subdivision or at the record date of such dividend shall, simultaneously with
      the effectiveness of such subdivision or immediately after the record date
      of
      such dividend, be proportionately reduced, and conversely, if outstanding shares
      of the Common Stock of the Company shall be combined into a smaller number
      of
      shares, the Exercise Price of the Option in effect immediately prior to such
      combination shall, simultaneously with the effectiveness of such combination,
      be
      proportionately increased.

     

    5.2. When
      any
      adjustment is required to be made in the Exercise Price, the number of Option
      Shares purchasable upon the exercise of the Option shall be adjusted to that
      number of Option Shares determined by dividing (a) an amount equal to the
      number of Option Shares purchasable upon the exercise of the Option immediately
      prior to such adjustment, multiplied by the Exercise Price in effect immediately
      prior to such adjustment, by (b) the Exercise Price in effect immediately
      after such adjustment.

     

    5.3. Subject
      to Section 6 of this Agreement, following any capital reorganization, any
      reclassification of the Common Stock (other than recapitalization described
      in
      Section 5.1
      of this
      Agreement), or the consolidation or merger of the Company, upon exercise of
      the
      Option the Optionee shall be entitled to receive the securities or property
      (including cash) that the Optionee would have received had the Optionee
      exercised the Option immediately prior to such reorganization, reclassification,
      consolidation or merger, and in any such case appropriate adjustments shall
      be
      made in the application of the provisions set forth in this Agreement with
      respect to the rights and interests thereafter of the Optionee, to the end
      that
      the provisions set forth in this Agreement (including the specified changes
      and
      other adjustments to the Exercise Price) shall thereafter be applicable in
      relation to any securities or other property thereafter issuable upon exercise
      of the Option.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    6. Corporate
      Transactions.
      In the
      event of a Corporate Transaction, the Option shall terminate immediately prior
      thereto unless the Company, in its sole discretion, either provides that the
      Option shall not terminate or provides that the Option shall be assumed by
      an
      applicable successor corporation or entity or any affiliate of the successor
      corporation or entity. If the Option shall terminate upon a Corporate
      Transaction, the Option shall be exercisable in full immediately prior to the
      Corporate Transaction without regard to the vesting provisions under Section
      2
      of this Agreement. For purposes of this Agreement, a “Corporate
      Transaction”
shall
      mean (a) a liquidation or dissolution of the Company; (b) a merger or
      consolidation of the Company with or into another corporation (other than a
      merger with a wholly owned subsidiary); or (c) a sale of all or
      substantially all of the assets of the Company in a single transaction or a
      series of related transactions. 

     

    7. Restrictions
      on Sale of Purchased Shares.
      Optionee understands that: (a) unless the issuance of the Purchased Shares
      to
      Optionee upon exercise of the Option is registered under the Securities Act
      of
      1933, the Purchased Shares will be “restricted
      securities”
within
      the meaning of Rule 144 under the Securities Act; (b) the Purchased Shares
      may
      not be sold, transferred or assigned by the Optionee except pursuant to an
      effective registration statement under the Securities Act or an exemption from
      registration under the Securities Act; and (c) the Company is under no
      obligation to file a registration statement under the Securities Act covering
      the Option Shares. Optionee agrees that any certificates evidencing Purchased
      Shares may bear a legend indicating that their transferability is restricted
      in
      accordance with applicable state and federal securities laws.

     

    8. General
      Provisions

     

    8.1. Further
      Assurances.
      Optionee shall promptly take all actions and execute all documents requested
      by
      the Company that the Company deems to be reasonably necessary to effectuate
      the
      term and intent of this Agreement.

     

    8.2. Notices.
      All
      notices, requests, demands and other communications (collectively, “Notices”)
      given
      pursuant to this Agreement shall be in writing, and shall be delivered by
      personal service, courier, or by United States first class, registered or
      certified mail, postage prepaid, addressed to the Optionee at his address on
      the
      records of the Company or to the Company at its principal executive offices.
      Any
      Notice, other than a Notice sent by registered or certified mail, shall be
      effective when received; a Notice sent by registered or certified mail, postage
      prepaid, return receipt requested, shall be effective on the earlier of when
      received or the third day following deposit in the United States mails. Any
      party may from time to time change its address for further Notices hereunder
      by
      giving notice to the other party in the manner prescribed in this
      Section.

     

    8.3. Failure
      to Enforce Not a Waiver.
      The
      failure of the Company to enforce at any time any provision of this Agreement
      shall in no way be construed to be a waiver of such provision or of any other
      provision hereof.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    8.4. Governing
      Law.
      This
      Agreement shall be governed by and construed in accordance with the law of
      the
      State of California applicable to contracts made in, and to be performed within,
      that State.

     

    8.5. Transfer
      of Rights Under this Agreement.
      The
      Company may at any time transfer and assign its rights and delegate its
      obligations under this Agreement to any other person, corporation, firm or
      entity, with or without consideration.

     

    8.6. Option
      Non-transferable.
      Optionee may not sell, transfer, assign or otherwise dispose of the Option
      except by will or the laws of descent and distribution, and only Optionee or
      his
      or her legal representative or guardian may exercise the Option during
      Optionee’s lifetime.

     

    8.7. No
      Right to Employment.
      Nothing
      in this Option shall interfere with or limit in any way the right of the Company
      or other member of the Company Group to terminate Optionee’s employment,
      consulting or advising at any time, nor confer upon Optionee any right to
      continue in the employ of, consult with or advise the Company or other member
      of
      the Company Group.

     

    8.8. Successors
      and Assigns.
      Except
      to the extent specifically limited by the terms and provisions of this
      Agreement, this Agreement shall be binding upon and inure to the benefit of
      the
      parties hereto and their respective successors, assigns, heirs and personal
      representatives.

     

    8.9. Miscellaneous.
      Titles
      and captions contained in this Agreement are inserted for convenience of
      reference only and do not constitute a part of this Agreement for any other
      purpose. Except as specifically provided herein, neither this Agreement nor
      any
      right pursuant hereto or interest herein shall be assignable by any of the
      parties hereto without the prior written consent of the other party
      hereto.

     

    8.10. Tax
      Treatment.
      Optionee acknowledges that the tax treatment of the Option, the Option Shares
      or
      any events or transactions with respect thereto may be dependent upon various
      factors or events that are not determined by this Agreement. The Company makes
      no representations with respect to and hereby disclaims all responsibility
      as to
      such tax treatment.

     

    The
      signature page of this Agreement consists of the last page of the
      Certificate.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    EXHIBIT
      “A”

     

    NOTICE
      OF EXERCISE

     

    (To
      be
      signed only upon exercise of the Option)

    


    TO: CenterStaging
      Corp. 

     

    


    The
      undersigned, the holder of the enclosed Stock Option Agreement (Non-Qualified
      Stock Option), hereby irrevocably elects to exercise the purchase right
      represented by the Option and to purchase thereunder ______* shares of Common
      Stock of CenterStaging Corp. (the “Company”)
      and
      herewith encloses payment of $_________ in full payment of the purchase price
      of
      such shares being purchased.

     

     

    
      	
              Dated:
                

            	
               

            	 	 
	 	 	 	 
	 	 	 	(Signature must conform in all respects
              to
              name of holder as specified on the face of the Option)
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	
               (Address)

            
	 	 	 	 
	 	 	 	 
	 	 	 	
              Social
                Security Number

            


    

     

    
      	*	
              Insert
                here the number of shares being exercised, making all adjustments
                for
                stock splits, stock dividends or other additional Common Stock of
                the
                Company, other securities or property which, pursuant to the adjustment
                provisions of Section 5 of the Option, may be deliverable upon
                exercise.