Exhibit 10.5

                          SMARTVIDEO TECHNOLOGIES, INC.
                           2004 EQUITY INCENTIVE PLAN


1.       Purpose

         The purpose of the SmartVideo Technologies, Inc. 2004 Equity Incentive
Plan (the "Plan") is to attract and retain the best available talent and
encourage the highest level of performance by directors, employees and other
persons who perform services for SmartVideo Technologies, Inc. (the "Company").
By affording eligible persons the opportunity to acquire proprietary interests
in the Company and by providing them incentives to put forth maximum efforts for
the success of the Company's business, the Plan is intended to serve the best
interests of the Company and its stockholders.

2.       Definitions

         "Affiliate" shall mean (i) any entity that, directly or indirectly, is
controlled by the Company, and (ii) any entity in which the Company has a
significant equity interest, in either case as determined by the Committee.

         "Award" shall mean any Option, Stock Appreciation Right, Restricted
Stock Award, Performance Award or other Stock-Based Award.

         "Award Agreement" shall mean any written agreement, contract, or other
instrument or document evidencing any Award, which may, but need not, be
executed or acknowledged by a Participant.

         "Board" shall mean the Board of Directors of the Company.

         "Change in Control" shall mean:

         (i) the acquisition, in a single transaction or series of related
transactions, by any individual, entity or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Exchange Act (a "Person") of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange act) of 50% or
more of either (i) the outstanding shares of common stock of the Company
immediately after the consummation of such acquisition (the "Outstanding Company
Common stock") or (ii) the combined voting power of the outstanding voting
securities of the Company entitled to vote generally in the election of
directors immediately after the consummation of such acquisition (the
"Outstanding Company Voting Securities") or;

         (ii) the cessation for any reason of individuals who, as of the date
hereof, constitute the Board (the "Incumbent Board") to constitute at least a
majority of the Board; provided, however, that any individual becoming a
director subsequent to the date hereof whose election, or nomination for
election by the Company's shareholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board; or

         (iii) the approval by the shareholders of the Company of a
reorganization, merger or consolidation, in each case, unless, following such
reorganization, merger or consolidation, more than 50% of, respectively, then
outstanding shares of common stock of the corporation resulting from such
reorganization, merger or consolidation and the combined voting power of then
outstanding voting securities of such corporation entitled to vote generally in
the election of directors is then beneficially owned, directly or indirectly, by
all or substantially all of the individuals and entities who were the beneficial
owners, respectively, of the Outstanding Company Common stock and Outstanding
Company Voting Securities immediately prior to such reorganization, merger or
consolidation in substantially the same proportions as their ownership,
immediately prior to such reorganization, merger or consolidation, of the
Outstanding Company Common stock and Outstanding Company Voting Securities, as
the case may be; or

         (iv) the approval by the shareholders of the Company of (i) a complete
liquidation or dissolution of the Company or (ii) the sale or other disposition
of all or substantially all of the assets of the Company.


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         "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.

         "Committee" shall mean the Compensation Committee of the Board or such
other committee consisting of not less than one Board member designated by the
Board to administer the Plan, all of whom are "non-employee directors" within
the meaning of Rule 16b-3 of the Exchange Act and "outside directors" within the
meaning of Section 162(m) of the Code.

         "Common Shares" shall mean shares of the common stock, $.001 par value,
of the Company, or such other securities of the Company as may be designated by
the Committee from time to time.

         "Company" shall mean SmartVideo Technologies, Inc., a Delaware
corporation.

         "Effective Date" means January 1, 2004, provided that adoption of the
Plan shall have been approved by the stockholders of the Company not later than
12 months after such date.

         "Employee" shall mean an employee of the Company or of any Affiliate, a
director of the Company, or any non-employee who provides services to the
Company or any Affiliate.

         "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.

         "Fair Market Value" of the Common Shares shall mean the average of the
high and low prices of the Common Shares as reported by the Nasdaq National
Market System, or such other recognized exchange or over-the-counter market on
which the Common Shares shall then be traded, or the Fair Market Value of any
other property or other item being valued as determined by the Committee in its
sole discretion.

         "Freestanding Right" shall mean a Stock Appreciation Right awarded by
the Committee pursuant to Section 7 of the Plan other than in connection with an
Option.

         "Incentive Stock Option" shall mean the right to purchase Common Shares
from the Company that is granted under Section 6 of the Plan and that is
intended to meet the requirements of Section 422 of the Code or any successor
provision thereto.

         "Insider" shall mean, at any time, an individual who is an officer,
director, or 10% stockholder of the Company within the meaning of Exchange Act
Rule 16a-1(f) as promulgated and interpreted by the SEC under the Exchange Act,
or any successor rule or regulation thereto as in effect from time to time.

         "Non-Qualified Stock Option" shall mean a right to purchase Common
Shares from the Company that is granted under Section 6 of the Plan and that is
not intended to be an Incentive Stock Option.

         "Option" shall mean an Incentive Stock Option or a Non-Qualified Stock
Option.

         "Other Stock-Based Award" shall mean any right granted under Section 10
of the Plan.

         "Participant" shall mean any Employee, director or individual
independent contractor of the Company or one of its Affiliates selected by the
Committee to receive an Award under the Plan.

         "Performance Award" shall mean any right granted under Section 9 of the
Plan.

         "Person" shall mean any individual, corporation, partnership,
association, joint-stock company, trust, unincorporated organization, government
or political subdivision thereof or other entity.

         "Plan" shall mean this Smart Video Technologies, Inc. 2004 Equity
Incentive Plan.

         "QDRO" shall mean a domestic relations order meeting such requirements
as the Committee shall determine, in its sole discretion.

         "Restricted Period" shall mean the period during which Restricted Stock
and Restricted Units may be forfeited to the Company.

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         "Restricted Stock" shall mean Common Shares granted under Section 8 of
the Plan.

         "Restricted Stock Unit" shall mean any unit granted under Section 8 of
the Plan.

         "Rule 16b-3" shall mean Rule 16b-3 as promulgated and interpreted by
the SEC under the Exchange Act, or any successor rule or regulation thereto as
in effect from time to time.

         "SEC" shall mean the Securities and Exchange Commission.

         "Stock Appreciation Right" shall mean any Tandem Right or Freestanding
Right granted under Section 7 of the Plan.

         "Tandem Right" shall mean a Stock Appreciation Right awarded by the
Committee in connection with an Option pursuant to Section 7 of the Plan.

         "Total Disability" shall mean a determination by the Committee that the
Employee is unable to perform the duties required of him or her by the Company
as a result of any physical or mental condition.

3.       Scope and Duration

         Awards under the Plan may be granted in the form of Incentive Stock
Options, Non-Qualified Stock Options, Stock Appreciation Rights, Restricted
Shares, Restricted Units, Performance Awards or Other Stock-Based Awards. The
maximum aggregate number of Common Shares as to which Awards may be granted from
time to time under the Plan is 2,000,000 shares, subject to adjustment as
provided in Section 14. The Common Shares available may be in whole or in part,
as the Board shall from time to time determine, authorized but unissued shares
or issued shares re-acquired by the Company. Unless otherwise provided by the
Committee, Common Shares covered by expired, terminated or forfeited Awards,
Awards which are settled for cash or consideration other than the delivery of
Common Shares, or Common Shares which are used to exercise any Award or to
satisfy the withholding tax liabilities of any Award will be available for
subsequent awards under the Plan. No Incentive Stock Option shall be granted
more than 10 years after the Effective Date.

4.       Administration

         The Plan shall be administered by the Committee. The Committee shall
have plenary authority in its discretion, subject to and not inconsistent with
the express provisions of the Plan, to grant Awards, to determine the terms and
conditions applicable to Awards, to determine the persons to whom, and the time
or times at which, Awards shall be granted and the number of Common Shares to be
covered by each grant; to determine the terms and provisions of the Award
Agreements entered into in connection with Awards under the Plan; to interpret
the Plan; to prescribe, amend and rescind rules and regulations relating to the
Plan; and to make all other determinations provided for in the Plan, or deemed
necessary or advisable for the administration of the Plan. The Committee may
reprice any outstanding Option at its discretion. To the extent permissible by
law, the Committee may delegate to one or more of its members or to one or more
agents such administrative duties as it may deem advisable, and the Committee or
any person to whom it has delegated duties as aforesaid may employ one or more
persons to render advice with respect to any responsibility the Committee or
such person may have under the Plan.

5.       Eligibility; Factors to be Considered in Granting Awards

         Subject to the discretion of the Committee, Awards may be granted to
any Employee of the Company and its Affiliates, a director of the Company, or a
non-employee who provides service to the Company or its Affiliates, except that
a non-employee shall not be granted an Incentive Stock Option. In determining
the Employees to whom Awards shall be granted and the number of Common Shares or
units to be covered by each Award, the Committee shall take into account the
nature of the Employee's duties, the present and potential contributions to the
success of the Company, and such other factors as it shall deem relevant in
connection with accomplishing the purposes of the Plan.

         No award of Incentive Stock Options shall result in the aggregate Fair
Market Value of Common Shares with respect to which Incentive Stock Options are
exercisable for the first time by any Employee during any calendar year
(determined at the time the Incentive Stock Option is granted) exceeding
$100,000.

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6.       Stock Options

         (a)      Exercise Price

         The purchase price of the Common Shares covered by each Option shall be
determined by the Committee, but in the case of an Incentive Stock Option shall
not be less than 100% of the Fair Market Value (110% in the case of a
stockholder owning more than 10% of the combined voting power of all classes of
Company stock) of the Common Shares on the date the Option is granted, or if
there are no sales on such date, on the next preceding day on which there were
sales.

         (b)      Terms of Options

         The term of each Incentive Stock Option granted under the Plan shall
not be more than 10 years (5 years in the case of a stockholder of the Company
owning more than 10% of the combined voting power of all classes of Company
stock) from the date of grant, as the Committee shall determine, subject to
earlier termination as provided in Sections 11 and 12. The term of each
Non-Qualified Stock Option granted under the Plan shall be such period of time
as the Committee shall determine, subject to earlier termination as provided in
Sections 11 and 12.

         (c) Exercise of Options

         (i) Subject to the provisions provided herein, an Option granted under
the Plan shall become vested as determined by the Committee. The Committee may,
in its discretion, determine as a condition of any Option, that all or a stated
percentage of the Option shall become exercisable, in installments or otherwise,
only after the completion of a specified service requirement, or the
satisfaction or occurrence of other conditions. The Committee may also, in its
discretion, accelerate the exercisability of any Option at any time and provide
in any Award Agreement that the Option shall become immediately exercisable as
to all Common Shares remaining subject to the Option upon a Change in Control.

         (ii) Subject to applicable regulatory restrictions, an Option may be
exercised at any time or from time to time (further subject, in the case of an
Incentive Stock Option, to such restrictions as may be imposed by the Code), as
to any or all full shares as to which the Option has become exercisable.
Notwithstanding the foregoing provision, no Option may be exercised without the
prior consent of the Committee by an Insider until the expiration of six months
from the date of the grant of the Option.

         (iii) Except as provided in Sections 11, 12 and 13, no Option may be
exercised at any time unless the holder thereof is then an Employee, director or
individual independent contractor of the Company or one of its Affiliates.

         (d) Payment

         The purchase price of the Common Shares as to which an Option is
exercised shall be paid in full at the time of exercise. Payment may be made (i)
in cash, which may be paid by check, or other instrument acceptable to the
Company, (ii) with the consent of the Committee or the Chief Executive Officer,
in Common Shares, valued at the Fair Market Value on the date prior to exercise,
or if there were no sales on such date, on the next preceding day on which there
were sales, (iii) with the consent of the Committee and subject to such terms
and conditions as it may determine, by surrender of outstanding Awards under the
Plan, (iv) with the consent of the Committee, the delivery of a promissory note
containing such terms as deemed acceptable to the Committee, or (v) any
combination of the above. In addition, any amount necessary to satisfy
applicable federal, state or local tax requirements shall be paid promptly upon
notification of the amount due. The Committee may permit such amount to be paid
in Common Shares previously owned by the Employee, or a portion of the Common
Shares that otherwise would be distributed to such Employee upon exercise of the
Option, or a combination of cash and such Common Shares.



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         (e)      Change in Control

         Unless the Board determines otherwise, and except as otherwise provided
herein, all Options outstanding under the Plan shall accelerate and become
immediately exercisable for a period of fifteen days, or such longer or shorter
period as the Board may prescribe, (the "notice period") immediately prior to
the scheduled consummation of a Change in Control, provided, however, that any
such acceleration and any exercise of options during the notice period shall be
(i) conditioned upon the consummation of the Change in Control and (ii)
effective only immediately before the consummation of such Change in Control.

         Upon consummation of any Change in Control, the Plan and all
outstanding but unexercised Options shall terminate. Notwithstanding the
foregoing, to the extent provision is made in writing in connection with such
Change in Control for the continuation of the Plan and the assumption of Options
under the Plan theretofore granted, or for the substitution for such Options of
new options covering the stock of a successor company, or a parent or subsidiary
thereof, with appropriate adjustments as to the number and kinds of shares or
units and exercise prices, then the Plan and Options theretofore granted shall
continue in the manner and under the terms so provided, and the acceleration and
termination provisions set forth in the first two sentences of this Section 6(e)
shall be of no effect. The Company shall send written notice of a Change in
Control to all individuals who hold Options not later than the time at which the
Company gives notice thereof to its stockholders.

7.       Stock Appreciation Rights

         (a)      Awards

         The Committee may award Stock Appreciation Rights to Employees of the
Company or any of its Affiliates. Stock Appreciation Rights may be either Tandem
Rights or Freestanding Rights. Tandem Rights may be awarded either at the time
the Option is granted or at any time prior to the exercise of the Option.

         (b) Terms and Conditions

         (i) Each Tandem Right shall be subject to the same terms and conditions
as the related Option and shall be exercisable only to the extent the Option is
exercisable.

         (ii) The price per share specified in a Freestanding Right shall be
determined by the Committee, but in no event shall be less than the Fair Market
Value of the Common Shares as of the date of grant. The term of each
Freestanding Right shall be such period of time as the Committee shall
determine. Subject to the provisions of the Plan, each Freestanding Right shall
become vested as determined by the Committee. Prior to becoming 100% vested,
each Freestanding Right shall become exercisable, in installments or otherwise,
as the Committee shall determine. The Committee may also, in its discretion,
accelerate the exercisability of any Freestanding Right at any time, including a
Change in Control.

         (c) Exercise

         (i) Upon exercise of a Stock Appreciation Right, (subject, in the case
of a Tandem Right, to the surrender of the related Option or any unexercised
portion thereof which the Employee determines to surrender for this purpose) the
Employee shall be entitled to receive, subject to the provisions of the Plan and
such rules and regulations as from time to time may be established by the
Committee, a payment having an aggregate value equal to (A) the excess of (i)
the Fair Market Value on the exercise date of one Common Share over (ii) the
Option price per share, in the case of a Tandem Right, or the price per share
specified in the terms of a Freestanding Right, times (B) the number of Common
Shares with respect to which the Stock Appreciation Right shall have been
exercised.

         (ii) Upon exercise of a Tandem Right, the number of Common Shares
subject to exercise under the related Option shall automatically be reduced by
the number of Common Shares represented by the Option or portion thereof
surrendered.

         (iii)A Tandem Right related to an Incentive Stock Option may only
be exercised if the Fair Market Value of a Common Share on the exercise date
exceeds the Option price.

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         (d) Payments

         (i) The payment described in subparagraph (c)(i) above shall be made in
the form of cash, Common Shares, or a combination thereof, as elected by the
Employee, provided that the Committee shall have sole discretion to consent to
or disapprove the election of an officer or director to receive all or part of a
payment in cash.

         (ii) If upon exercise of a Stock Appreciation Right the Employee is to
receive a portion of the payment in Common Shares, the number of shares received
shall be determined by dividing such portion by the Fair Market Value of a share
on the exercise date. The number of Common Shares received may not exceed the
number of Common Shares covered by any Option or portion thereof surrendered.
Cash will be paid in lieu of any fractional share.

         (iii) Whether payments to Employees upon exercise of Tandem Rights or
Freestanding Rights are made in cash, Common Shares or a combination thereof,
the Committee shall have sole discretion as to timing of the payments, whether
in one lump sum or in annual installments or otherwise deferred, which deferred
payments may in the Committee's sole discretion (i) bear amounts equivalent to
interest or cash dividends, (ii) be treated as invested in the manner from time
to time determined by the Committee, with dividends or other income thereon
being deemed to have been so reinvested, or (iii) for the convenience of the
Company, contributed to a trust, which may be revocable by the Company or
subject to the claims of its creditors, for investment in the manner from time
to time determined by the Committee and set forth in the instrument creating
such trust, all as the Committee shall determine.

         (iv) No payment will be required from the Employee upon exercise of a
Stock Appreciation Right, except that any amount necessary to satisfy applicable
federal, state or local tax requirements shall be withheld or paid promptly upon
notification of the amount due and prior to or concurrently with delivery of
cash or a certificate representing shares. The Committee may permit such amount
to be paid in (i) Common Shares previously owned by the Employee, (ii) a portion
of the Common Shares that otherwise would be distributed to such Employee upon
exercise of the right, or (iii) a combination of cash and Common Shares.

8.       Restricted Shares or Restricted Units

         (a)      Awards

         Restricted Stock or Restricted Stock Units may be awarded by the
Committee in its sole discretion. At the time an award of Restricted Shares or
Restricted Units is made, the Committee shall (i) establish a Restricted Period
applicable to such award, (ii) prescribe conditions for the incremental lapse of
restrictions during the Restricted Period, or for the lapse or termination of
restrictions upon the satisfaction or occurrence of other conditions in addition
to or other than the expiration of the Restricted Period, including a Change in
Control, and (iii) determine all other terms and conditions of such award,
including voting and dividend or dividend equivalent rights.

         (b)      Restrictions on Transfer

         Upon the grant of Restricted Shares, a stock certificate representing
the number of Common Shares equal to the number of Restricted Shares granted to
an Employee shall be registered in the Employee's name but shall be held in
custody by the Company for the Employee's account. The Employee shall not be
entitled to delivery of the certificate or to sell, transfer, assign, pledge or
otherwise encumber the Restricted Shares until the expiration of the Restricted
Period and the satisfaction of any other conditions prescribed by the Committee.
Upon the forfeiture of any Restricted Shares, such forfeited Restricted Shares
shall be transferred to the Company without further action by the Employee.

         (c)      Delivery of Shares

         Upon the expiration or termination of the Restricted Period and the
satisfaction of any other conditions prescribed by the Committee or at such
earlier time as provided for in Section 12, a stock certificate for the number
of Common Shares with respect to which the restrictions have lapsed, or one
Common Share for each Restricted Stock Unit with respect to which the
restrictions have lapsed, shall be delivered, free of all such restrictions,
except any that may be imposed by law, to the Employee or the Employee's
beneficiary or estate, as the case may be. Fractional Shares will be paid in
cash.

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         (d)      Payment

         No payment will be required from the Employee upon the issuance or
delivery of any Common Shares, except that any amount necessary to satisfy
applicable federal, state or local tax requirements shall be withheld or paid
promptly upon notification of the amount due and prior to or concurrently with
the issuance or delivery of a certificate representing such shares. The
Committee may permit such amount to be paid in (i) Common Shares previously
owned by the Employee, (ii) a portion of the Common Shares that otherwise would
be distributed to such Employee upon the lapse of the restrictions applicable to
the Restricted Shares or Restricted Units, or (iii) a combination of cash and
Common Shares.

9.       Performance Awards

         (a)      Grant

         Performance Awards may be granted to any Employee by the Committee in
its sole discretion. A Performance Award shall consist of a right that is (i)
denominated in cash or Common Shares, (ii) valued, as determined by the
Committee, in accordance with the achievement of such performance goals during
such performance periods as the Committee shall establish, and (iii) payable at
such time and in such form as the Committee shall determine.

         (b)      Terms and Conditions

         Subject to the terms of the Plan and any applicable Award Agreement,
the Committee shall (i) determine the performance goals to be achieved during
any performance period, (ii) the length of any performance period, (iii) the
amount of any Performance Award, (iv) the amount and kind of any payment or
transfer to be made pursuant to any Performance Award, and (v) all other terms
and conditions of any Performance Award, including the consequences of death,
Total Disability, termination of employment and Change in Control.

         (c)      Payment of Performance Awards

         Performance Awards may be paid in a lump sum or in installments
following the close of the performance period or, in accordance with procedures
established by the Committee, on a current or deferred basis.

10.      Other Stock-Based Awards

         The Committee shall have authority to grant to eligible Employees an
"Other Stock-Based Award," which shall consist of any right that is an Award of
Common Shares or an Award denominated or payable in, valued in whole or in part
by reference to, or otherwise based on or related to, Common Shares (including,
without limitation, securities convertible into Common Shares), as deemed by the
Committee to be consistent with the purposes of the Plan, other than an Award
described in Sections 6 through 9 above.

11.      Termination of Employment

         Unless otherwise determined by the Committee, and subject to such
restrictions as may be imposed by the Code in the case of any Incentive Stock
Options, in the event that the employment of an Employee to whom an Option or
Stock Appreciation Right has been granted under the Plan shall be terminated
(except as set forth in Section 12), such Option or Stock Appreciation Right
may, subject to the provisions of the Plan, be exercised, to the extent that the
Employee was entitled to do so at the termination of his employment, at any time
within three months after such termination, but in no case later than the date
on which the Option or Stock Appreciation Right terminates.

         Unless otherwise determined by the Committee, if an Employee to whom
Restricted Stock or Restricted Stock Units have been granted ceases to be an
Employee prior to the end of the Restricted Period and the satisfaction of any
other conditions prescribed by the Committee for any reason other than death or
Total Disability, the Employee shall immediately forfeit all Restricted Stock
and Restricted Stock Units.


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12.      Death or Total Disability of Employee

         Unless otherwise determined by the Committee, if an Employee to whom an
Option or Stock Appreciation Right has been granted under the Plan shall die or
suffer a Total Disability while employed by the Company, such Option or Stock
Appreciation Right may be exercised, to the extent it was exercisable at the
date of such Employee's death or Total Disability, at any time within one year
after the date of the Employee's death or Total Disability, but in no case later
than the date on which the Option or Stock Appreciation Right otherwise
terminates.

         If an Employee to whom Restricted Stock or Restricted Stock Units have
been granted shall die or suffer a Total Disability prior to the end of the
Restricted Period and the satisfaction of any other conditions prescribed by the
Committee, or in cases of other special circumstances, the Committee may, in its
sole discretion, waive in whole or in part any or all remaining restrictions
with respect to such Employee's Restricted Stock or Restricted Stock Units.

13.      Non-Transferability of Awards

         Awards granted under the Plan shall not be transferable other than by
will or the laws of descent and distribution, or pursuant to a qualified
domestic relations order as defined by Section 414(p) of the Code except to the
extent provided in any Award Agreement and permitted under applicable law.

14.      Adjustment upon Changes in Capitalization, etc.

         (a) The existence of outstanding Options or other Awards shall not
affect in any way the right or ability of the Company or its stockholders to
make or authorize any or all adjustments, recapitalizations, reorganizations or
other changes in the Company's capital structure or its business, or any merger
or consolidation of the Company, or any issue of bonds, debentures, preferred or
prior preference stock ahead of or affecting the Common Shares or the rights
hereof, or the dissolution or liquidation of the Company, or any sale or
transfer of all or any part of its assets or business or substantially all of
the outstanding stock of the Company, or any other corporate act or proceeding,
whether of a similar character or otherwise.

         (b) If the Company shall effect a subdivision, consolidation or
reclassification of the Common Shares or other capital readjustment or
recapitalization, the payment of a stock dividend, or other increase or
reduction in the number of the Common Shares outstanding, without receiving
compensation therefor in money, services or property, then the number, class,
and per share price of Common Shares shall be appropriately adjusted in such a
manner as to entitle Employees to receive, for the same aggregate cash
consideration, if applicable, the same total number and class of shares as he
would have received as a result of the event requiring the adjustment and the
number of shares of stock which may be issued under the Plan shall be
appropriately adjusted in order to prevent dilution or enlargement of rights.

         (c) Except as hereinbefore expressly provided, the issue by the Company
of shares of stock of any class, for cash or property, or for labor or services,
either upon direct sale or upon the exercise of rights or warrants to subscribe
therefor, or upon conversion of shares or obligations of the Company convertible
into such shares or other securities, shall not affect, and no adjustment by
reason thereof shall be made with respect to, the number or price of Common
Shares then subject to outstanding options.

15.      Effective Date

         The Plan was effective as of January 1, 2004; provided that the
adoption of the Plan shall have been approved by the stockholders of the Company
not later than 12 months after such date. The Committee may, in its discretion,
grant Awards under the Plan, the grant, exercise or payment of which shall be
expressly subject to the conditions that, to the extent required at the time of
grant, exercise or payment, (i) if the Company deems it necessary or desirable,
a Registration Statement under the Securities Act of 1933, as amended, with
respect to such Common Shares shall be effective, and (ii) any requisite
approval or consent of any governmental authority of any kind having
jurisdiction over Awards granted under the Plan shall be obtained.


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16.      Amendment of the Plan

         (a) The Board at any time, and from time to time, may amend the Plan.
However, except as provided in Section 14 relating to adjustments upon changes
in the Common Shares, no amendment shall be effective unless

approved by the stockholders of the Company within twelve (12) months before or
after the adoption of the amendment, where the amendment will:

(i) Increase the number of Common Shares reserved for Awards under the Plan;

(ii) Modify the requirements as to eligibility for participation in the Plan (to
the extent such modification requires stockholder approval in order for the Plan
to satisfy the requirements of Section 422(b) of the Code); or

(iii) Modify the Plan in any other way if such modification requires stockholder
approval in order for the Plan to satisfy the requirements of Section 422(b) of
the Code.

(b) The Board may in its sole discretion submit any amendment to the Plan for
stockholder approval, including, but not limited to, amendments to the Plan
intended to satisfy the requirements of Section 162(m) of the Code and the
regulations promulgated thereunder regarding the exclusion of performance-based
compensation from the limit on corporate deductibility of compensation to
certain executive officers.

(c) It is expressly contemplated that the Board may amend the Plan in any
respect the Board deems necessary or advisable to provide optionees with the
maximum benefits provided or to be provided under the provisions of the Code and
the regulations promulgated thereunder relating to employee Incentive Stock
Options and/or to bring the Plan and/or Options granted under it into compliance
therewith.

(d) Rights and obligations under any Award granted before amendment of the Plan
shall not be impaired by any amendment of the Plan, unless: (i) the Company
requests the consent of the person to whom the Award was granted; and (ii) such
person consents in writing.

17. Termination or Suspension of the Plan

(a) The Board may suspend or terminate the Plan at any time. No Stock Awards
may be granted under the Plan while the Plan is suspended or after it is
terminated. No Incentive Stock Options may be granted under the Plan after
January 1, 2014.

(b) Rights and obligations under any Awards granted while the Plan is in effect
shall not be impaired by suspension or termination of the Plan, except with the
consent of the Person to whom the Award was granted.

18.      Miscellaneous

         (a)      Written Agreements

         Each Award hereunder shall be evidenced by an Award Agreement that
shall contain such restrictions, terms and conditions as the Committee may
require.

         (b)      No Right to Employment

         Nothing in the Plan or in any Award granted pursuant to the Plan shall
confer upon any Employee any right to continue in the employ of the Company or
any of its subsidiaries or interfere in any way with the right of the Company or
any such subsidiary to terminate such employment at any time.

         (c)      Governing Law

         The validity, construction, and effect of the Plan and any rules and
regulations relating to the Plan and any Award Agreement shall be determined in
accordance with the laws of the State of Delaware.

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<PAGE>

         (d)      Severability

         If any provision of the Plan or any Award is or becomes or is deemed to
be invalid, illegal, or unenforceable in any jurisdiction or as to any Employee
or Award, or would disqualify the Plan or any Award under any law or regulations
deemed applicable, or the compliance with which is deemed desirable, including
any accounting rules or regulations, by the Committee, such provision shall be
construed or deemed amended to conform to the applicable laws, rules or
regulations, or if it cannot be construed or deemed amended without, in the
determination of the Committee, materially altering the intent of the Plan or
the Award, such provision shall be stricken as to such jurisdiction, Employee or
Award and the remainder of the Plan and any such Award shall remain in full
force and effect.

         (e)      Other Laws

         The Committee may refuse to issue or transfer any Common Shares or
other consideration under an Award if, acting in its sole discretion, it
determines that the issuance or transfer of such Common Shares or such other
consideration might violate any applicable law or regulation or entitle the
Company to recover the same under Section 16(b) of the Exchange Act, and any
payment tendered to the Company by an Employee, other holder or beneficiary in
connection with the exercise of such Award shall be promptly refunded to the
relevant Employee, holder, or beneficiary.


         IN WITNESS WHEREOF, the Company has caused its duly authorized officer
to execute this 2004 Equity Incentive Plan as of this 1st day of January 2004.

                                         SMARTVIDEO TECHNOLOGIES, INC.

                             By:      /s/Richard E. Bennett, Jr.
                                         -----------------------
                             Name:       Richard E. Bennett, Jr.
                             Title:      President and Chief Executive Officer


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