fs81208ex10_snap.htm


     

    Exhibit
10.1

    
      


      


      SNAP
INTERACTIVE, INC.

      EQUITY INCENTIVE
PLAN

      


      1.           Purpose. The purpose
of the plan is to provide incentives to attract, retain and motivate eligible
persons whose present and potential contributions are important to the success
of SNAP INTERACTIVE, INC. a Delaware corporation (the “Company”), and its
Subsidiaries and Affiliates, by offering them an opportunity to participate in
the Company’s future performance through awards of Options and Free Trading
Stock. Capitalized terms not defined in the text are defined in Section
22.

      


      2.           Shares Subject to the Plan;
Per-Person Award Limitation.

      


      2.1 Number of Shares
Available. Subject to Sections 2.2 and 17, the total number of Shares
reserved and available for grant and issuance pursuant to the Plan shall be Five
Hundred Thousand (500,000) Shares. Subject to Sections 2.2 and 17, Shares shall
again be available for grant and issuance in connection with future Awards under
the Plan that: (a) are subject to issuance upon exercise of an Option but cease
to be subject to such Option for any reason other than exercise of such Option;
(b) are subject to an Award granted hereunder but are forfeited; or (c) are
subject to an Award that otherwise terminates without Shares being issued.
Subject to Sections 2.2 and 17, in no event shall the aggregate number of Shares
that may be issued pursuant to incentive stock options exceed Five Hundred
Thousand (500,000) Shares.

      


      2.2  Adjustment of Shares.
In the event that the number of outstanding Shares is changed by a stock
dividend, recapitalization, stock split, reverse stock split, subdivision or
similar change in the capital structure of the Company without consideration,
then: (a) the number of Shares reserved for issuance under the Plan; (b) the
Exercise Prices of and number of Shares subject to outstanding Options; and (c)
the number of Shares subject to other outstanding Awards shall be
proportionately adjusted, subject to any required action by the Board or the
shareholders of the Company and in compliance with applicable securities
laws.

      


      3.          
Eligibility.

      


      3.1 General.
All  Awards set forth herein may be granted to employees, officers,
directors,  consultants and advisors of the Company or any Parent,
Subsidiary or Affiliate of the Company, provided such consultants and advisors
render bona fide services not in connection with the offer and sale of
securities in a capital-raising transaction. A person may be granted more than
one Award under the Plan.

      


      4.          
Administration.

      


      4.1 Compensation Board.
The Plan shall be administered by a by the Company's Board of Directors. Any
determination made by the Board with respect to any Award shall be made in its
sole discretion at the time of grant of the Award or, unless in contravention of
any express term of the Plan or Award, at any later time, and such determination
shall be final and binding on the Company and all persons having an interest in
any Award under the Plan.

       

       

      
        
          
          

        

        
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      4.2 Board Authority.
Subject to the general purposes, terms and conditions of the Board, the Board
shall have full power to implement and carry out the Plan. The Board may
delegate to one or more officers of the Company the authority to make
recommendations to grant an Award under the Plan to Participants who are not
Insiders of the Company. The Board shall have the authority to:

      


      
        	
                 
      

              	
                (a)

              	
                construe
      and interpret the Plan, any Award Agreement and any other agreement or
      document executed pursuant to the
Plan;

              


      

      
        	
                 
      

              	
                (b)

              	
                recommend
      to the Board amendments to the rules and regulations relating to the
      Plan;

              


      

      
        	
                 
      

              	
                (c)

              	
                select
      the persons to receive Awards;

              


      

      
        	
                 
      

              	
                (d)

              	
                determine
      the form and terms of Awards;

              


      

      
        	
                 
      

              	
                (e)

              	
                determine
      the number of Shares or other consideration subject to
    Awards;

              


      

      
        	
                 
      

              	
                (f)

              	
                determine
      whether Awards will be granted singly, in combination, in tandem with, in
      replacement of, or as alternatives to, other Awards under the Plan or any
      other incentive or compensation plan of the Company or any Parent,
      Subsidiary or Affiliate of the
Company;

              


      

      
        	
                 
      

              	
                (g)

              	
                determine
      the granting of certain waivers of Plan or Award
    conditions;

              


      

      
        	
                 
      

              	
                (h)

              	
                determine
      the conditions concerning the vesting, exercisability and payment of
      Awards;

              


      

      
        	
                 
      

              	
                (i)

              	
                recommend
      to the Board such matters so as to correct any defect, supply any
      omission, or reconcile any inconsistency in the Plan, any Award or any
      Award Agreement;

              


      

      
        	
                 
      

              	
                (j)

              	
                determine
      whether an Award has been earned;
and

              


      

      
        	
                 
      

              	
                (k)

              	
                make
      all other determinations necessary or advisable for the administration of
      the Plan.

              


      

      


      5.          
Options. The
Board may grant Options to eligible persons and shall determine whether such
Options shall be Incentive Stock Options within the meaning of the Code (“ISO”)
or Nonqualified Stock Options (“NQSO”), the number of Shares subject to the
Option, the Exercise Price of the Option, the period during which the Option may
be exercised, and all other terms and conditions of the Option, subject to the
following:

      


      5.1 Form of Option Grant.
Each Option granted under the Plan shall be evidenced by an Award Agreement
which shall expressly identify the Option as an ISO or NQSO (“Stock Option
Agreement”), and be in such form and contain such provisions (which need not be
the same for each Participant) as the Board shall from time to time approve, and
which shall comply with and be subject to the terms and conditions of the
Plan.

       

       

      
        
          
          

        

        
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      5.2 Date of Grant. The
date of grant of an Option shall be the date on which the Board makes the
determination to grant such Option, unless otherwise specified by the Board. The
Stock Option Agreement and a copy of the Plan will be delivered to the
Participant within a reasonable time after the granting of the
Option.

      


      5.3 Exercise Period.
Options shall be exercisable within the times or upon the events determined by
the Board as set forth in the Stock Option Agreement; provided, however, that no
Option shall be exercisable after the expiration of ten (10) years from the date
the Option is granted, and provided further that no Option granted to a person
who directly or by attribution owns more than ten percent (10%) of the total
combined voting power of all classes of stock of the Company or any Parent or
Subsidiary of the Company (“Ten Percent Shareholder”) shall be exercisable after
the expiration of one (1) year from the date the Option is granted. The Board
also may provide for the Options to become exercisable at one time or from time
to time, periodically or otherwise, in such number or percentage as the Board
determines.

      


      5.4 Exercise Price. The
Exercise Price shall be determined by the Board when the Option is granted and
may be not less than the par value of a Share on the date of grant provided
that: (i) the Exercise Price of an ISO shall be not less than one hundred
percent (100%) of the Fair Market Value of the Shares on the date of grant; (ii)
the Exercise Price of any ISO granted to a Ten Percent Shareholder shall not be
less than one hundred percent (100%) of the Fair Market Value of the Shares on
the date of grant; and (iii) the Exercise Price of any option granted that the
Board intends to qualify under Section 162(m) of the Code, shall not be less
than one hundred percent (100%) of the Fair Market Value of the Shares on the
date of grant. Payment for the Shares purchased may be made in accordance with
Section 7 of the Plan.

      


      5.5 Method of Exercise.
Options may be exercised only by delivery to the Company of a written stock
option exercise agreement (the “Exercise Agreement”) in a form approved by the
Board (which need not be the same for each Participant), stating the number of
Shares being purchased, the restrictions imposed on the Shares, if any, and such
representations and agreements regarding Participant’s investment intent and
access to information and other matters, if any, as may be required or desirable
by the Company to comply with applicable securities laws, together with payment
in full of the Exercise Price for the number of Shares being
purchased.

      


      5.6 Termination. Unless
otherwise set forth in the Stock Option Agreement, the exercise of an Option
shall be subject to the following:

      


      
        	
                 
      

              	
                (a)
      If the Participant is Terminated for any reason except death or
      Disability, then Participant may exercise such Participant’s Options only
      to the extent that such Options would have been exercisable upon the
      Termination Date no later than three (3) months after the Termination Date
      (or such shorter time period as may be specified in the Stock Option
      Agreement), but in any event, no later than the expiration date of the
      Options.

              


      

       

       

      
        
          
          

        

        
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                (b)
      If the Participant is terminated because of death or Disability (or the
      Participant dies within three (3) months of such termination), then
      Participant’s Options may be exercised only to the extent that such
      Options would have been exercisable by Participant on the Termination Date
      and must be exercised by Participant (or Participant’s legal
      representative or authorized assignee) no later than twelve (12) months
      after the Termination Date (or such shorter time period as may be
      specified in the Stock Option Agreement), but in any event no later than
      the expiration date of the Options; provided, however, that in the event
      of termination due to Disability other than as defined in Section 22(e)(3)
      of the Code, any ISO that remains exercisable after ninety (90) days after
      the date of termination shall be deemed a
NQSO.

              


      

      


      5.7 Limitations on
Exercise. The Board may specify a reasonable minimum number of Shares
that may be purchased on any exercise of an Option, provided that such minimum
number will not prevent Participant from exercising the Option for the full
number of Shares for which it is then exercisable.

       

      5.8 Modification, Extension or
Renewal. The Board may modify, extend or renew outstanding Options and
authorize the grant of new Options in substitution therefore, provided that any
such action may not without the written consent of Participant, impair any of
Participant’s rights under any Option previously granted. Any outstanding ISO
that is modified, extended, renewed or otherwise altered shall be treated in
accordance with Section 424(h) of the Code. The Board may reduce the Exercise
Price of outstanding Options without the consent of Participants affected by a
written notice to them; provided, however, that the Exercise Price may not be
reduced below the minimum Exercise Price that would be permitted under Section
5.4 of the Plan for Options granted on the date the action is taken to reduce
the Exercise Price.

      


      5.9 No Disqualification.
Notwithstanding any other provision in the Plan, no term of the Plan relating to
ISOs shall be interpreted, amended or altered, nor shall any discretion or
authority granted under the Plan be exercised, so as to disqualify the Plan
under Section 422 of the Code or, without the consent of the Participant
affected, to disqualify any ISO under Section 422 of the Code.

       

       

      
        
          
          

        

        
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      6.          
Payment For Share
Purchases.

      


      6.1 Payment. Payment for
Shares purchased pursuant to the Plan may be made in cash (by check) or, where
expressly approved for the Participant by the Board and where permitted by
law:

      


      
        	
                 
      

              	
                (a)
      by cancellation of indebtedness of the Company to the
      Participant;

              


      

      


      
        	
                 
      

              	
                (b)
      by transfer of Shares that either (1) have been owned by Participant for
      more than six (6) months and have been paid for within the meaning of SEC
      Rule 144; or (2) were obtained by Participant in the public
      market;

              


      

      


      
        	
                 
      

              	
                (c)
      by waiver of compensation due or accrued to Participant for services
      rendered;

              


      

      


      
        	
                 
      

              	
                (d)
      by tender of property;

              


      

      


      
        	
                 
      

              	
                (e)
      with a promissory note in favor of the Company, which such note shall (1)
      provide for full recourse to the maker, (2) be collateralized by the
      pledge of the Shares that the Optionee purchases upon exercise of the
      Option, (3) bear interest at the prime rate of the Company’s principal
      lender, and (4) contain such other terms as the Board in its sole
      discretion shall reasonably
require;

              


      

      


      
        	
                 
      

              	
                (f)
      by a “cashless exercise” in which Shares which would otherwise be
      delivered upon exercise of the Option may be used to satisfy the payment
      of the exercise price of the Option, in accordance with the following
      formula:

              


      

       

      X = Y (A-B)

      
        	
                 
      

              	
                A

              


      

      


      Where:

      X = the
number of Shares to be issued to Optionee.

      Y = the
number of Shares purchasable under the amount of the Option being
exercised

      A = the
per Share Fair Market Value

      
        	
                 
      

              	
                B =
      the per Share Exercise Price of the
Option

              


      

      


      
        	
                 
      

              	
                (g)
      with respect only to purchases upon exercise of an Option, and provided
      that a public market for the Company’s stock
  exists:

              


      

      


      
        	
                 
      

              	
                (1)
      through a “same day sale” commitment from Participant and a broker-dealer
      that is a member of the National Association of Securities Dealers (an
      “NASD Dealer”) whereby the Participant irrevocably elects to exercise the
      Option and to sell a portion of the Shares so purchased to pay for the
      Exercise Price, and whereby the NASD Dealer irrevocably commits upon
      receipt of such Shares to forward the Exercise Price directly to the
      Company; or

              


      

       

       

      
        
          
          

        

        
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                (2)
      through a “margin” commitment from Participant and an NASD Dealer whereby
      Participant irrevocably elects to exercise the Option and to pledge the
      Shares so purchased to the NASD Dealer in a margin account as security for
      a loan from the NASD Dealer in the amount of the Exercise Price, and
      whereby the NASD Dealer irrevocably commits upon receipt of such Shares to
      forward the exercise price directly to the Company;
  or

              


      

      
        	
                 
      

              	
                 

              	
                

                  (h)
      by any combination of the
foregoing.

                

              


      

      


      If the
Exercise Price or purchase price is paid in whole or in part with Shares or
through the withholding of Shares issuable upon exercise of the Option, the
value of the Shares surrendered or withheld shall be their Fair Market Value on
the date the Option is exercised.

      


      7.          
Withholding
Taxes.

      


      7.1 Withholding
Generally. Whenever Shares are to be issued in satisfaction of Awards
granted under the Plan, the Company may require the Participant to remit to the
Company an amount sufficient to satisfy federal, state and local withholding tax
requirements prior to the delivery of any certificate or certificates for such
Shares. Whenever, under the Plan, payments in satisfaction of Awards are to be
made in cash, such payment shall be net of an amount sufficient to satisfy
federal, state, and local withholding tax requirements.

      


      7.2 Stock Withholding.
When, under applicable tax laws, a Participant incurs tax liability in
connection with the exercise or vesting of any Award that is subject to tax
withholding and the Participant is obligated to pay the Company the amount
required to be withheld, the Board may allow the Participant to satisfy the
minimum withholding tax obligation by electing to have the Company withhold from
the Shares to be issued that number of Shares having a Fair Market Value equal
to the minimum amount required to be withheld, determined on the date that the
amount of tax to be withheld is to be determined (the “Tax Date”). All elections
by a Participant to have Shares withheld for this purpose shall be made in
writing in a form acceptable to the Board and shall be subject to the following
restrictions:

      


      
        	
                 
      

              	
                (a)
      the election must be made on or prior to the applicable Tax
      Date;

              


      

       

       

      
        
          
          

        

        
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                (b)
      once made, then except as provided below, the election shall be
      irrevocable as to the particular Shares as to which the election is
      made;

              


      

      


      
        	
                 
      

              	
                (c)
      all elections shall be subject to the consent or disapproval of
      the         Board;

              


      

      


      
        	
                 
      

              	
                (d)
      if the Participant is an Insider and if the Company is subject to Section
      1 6(b) of the Exchange Act: (1) the election may not be made within six
      (6) months of the date of grant of the Award, except as otherwise
      permitted by SEC Rule 1 6b-3(e) under the Exchange Act, and (2) either (A)
      the election to use stock withholding must be irrevocably made at least
      six (6) months prior to the Tax Date (although such election may be
      revoked at any time at least six (6) months prior to the Tax Date) or (B)
      the exercise of the Option or election to use stock withholding must be
      made in the ten (10) day period beginning on the third day following the
      release of the Company’s quarterly or annual summary statement of sales or
      earnings; and

              


      

      


      
        	
                 
      

              	
                (e)
      in the event that the Tax Date is deferred until six (6) months after the
      delivery of Shares under Section 83(b) of the Code, the Participant shall
      receive the full number of Shares with respect to which the exercise
      occurs, but such Participant shall be unconditionally obligated to tender
      back to the Company the proper number of Shares on the Tax
      Date.

              


      

      


      8.           Privileges of Stock
Ownership. No Participant shall have any of the rights of a shareholder
with respect to any Shares until the Shares are issued to the Participant. After
Shares are issued to the Participant, the Participant shall be a shareholder and
have all the rights of a shareholder with respect to such Shares, including the
right to vote and receive all dividends or other distributions made or paid with
respect to such Shares; provided, that if such Shares are Restricted Stock, then
any new, additional or different securities the Participant may become entitled
to receive with respect to such Shares by virtue of a stock dividend, stock
split or any other change in the corporate or capital structure of the Company
shall be subject to the same restrictions as the Restricted Stock.

      


      9.           Transferability.
Awards granted under the Plan, and any interest therein, shall not be
transferable or assignable by Participant, and may not be made subject to
execution, attachment or similar process, otherwise than by will or by the laws
of descent and distribution or as consistent with the specific Plan and Award
Agreement provisions relating thereto. During the lifetime of the Participant an
Award shall be exercisable only by the Participant, and any elections with
respect to an Award, may be made only by the Participant.

       

      
        
          
          

        

        
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      10.           Restrictions on
Shares. At the discretion of the Board, the Company may reserve to itself
and/or its assignee(s) in the Award Agreement a right of first refusal to
purchase all Shares that a Participant (or a subsequent transferee) may propose
to transfer to a third party.

      


      11.           Certificates. All
certificates for Shares or other securities delivered under the Plan shall be
subject to such stock transfer orders, legends and other restrictions as the
Board may deem necessary or advisable, including restrictions under any
applicable federal, state or foreign securities law, or any rules, regulations
and other requirements of the SEC or any stock exchange or automated quotation
system upon which the Shares may be listed.

      


      12.           Escrow; Pledge of
Shares. To enforce any restrictions on a Participant’s Shares, the Board
may require the Participant to deposit all certificates representing Shares,
together with stock powers or other instruments of transfer approved by the
Board, appropriately endorsed in blank, with the Company or an agent designated
by the Company to hold in escrow until such restrictions have lapsed or
terminated, and the Board may cause a legend or legends referencing such
restrictions to be placed on the certificates.

      


      13.           Exchange and Buy out of
Awards. The Board, may, at any time or from time to time, authorize the
Company, with the consent of the respective Participants, to issue new Awards in
exchange for the surrender and cancellation of any or all outstanding Awards.
The Company may at any time buy from a Participant an Award previously granted
with payment in cash, Shares (including Restricted Stock) or other
consideration, based on such terms and conditions as the Company and the
Participant shall agree.

      


      14.         
Securities Law and
Other Regulatory Compliance. An Award shall not be effective unless such
Award is in compliance with all applicable federal and state securities laws,
rules and regulations of any governmental body, and the requirements of any
stock exchange or automated quotation system upon which the Shares may then be
listed, as they are in effect on the date of grant of the Award and also on the
date of exercise or other Issuance. Notwithstanding any other provision in the
Plan, the Company shall have no obligation to issue or deliver certificates for
Shares under the Plan prior to: (a) obtaining any approvals from governmental
agencies that the Company determines are necessary or advisable, and/or (b)
completion of any registration or other qualification of such shares under any
state or federal law or ruling of any governmental body that the Company
determines to be necessary or advisable. The Company shall be under no
obligation to register the Shares with the SEC or to effect compliance with the
registration, qualification or listing requirements of any state securities
laws, stock exchange or automated quotation system, and the Company shall have
no liability for any inability or failure to do so.

      


      15.         
No Obligation to
Employ. Nothing in the Plan or any Award granted under the Plan shall
confer or be deemed to confer on any Participant any right to continue in the
employ of, or to continue any other relationship with, the Company or any
Parent, Subsidiary or Affiliate of the Company or limit in any way the right of
the Company or any Parent, Subsidiary or Affiliate of the Company to terminate
Participant’s employment or other relationship at any time, with or without
cause.

       

      
        
          
          

        

        
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      16.         
Corporate
Transactions.

      


      16.1
Assumption or
Replacement of Awards by Successor. In the event of (a) a merger or
consolidation in which the Company is not the surviving corporation (other than
a merger or consolidation with a wholly-owned subsidiary, a reincorporation of
the Company in a different jurisdiction, or other transaction in which there is
no substantial change in the shareholders of the company and the Awards granted
under the Plan are assumed or replaced by the successor corporation, which
assumption shall be binding on all Participants); (b) a dissolution or
liquidation of the Company; (c) the sale of substantially all of the assets of
the Company; or (d) any other transaction which qualifies as a “corporate
transaction” under Section 424(a) of the Code wherein the shareholders of the
Company give up all of their equity interest in the Company (except for the
acquisition, sale or transfer of all or substantially all of the outstanding
shares of the Company), all outstanding Awards may, to the extent permitted by
applicable law, be replaced by the successor corporation (if any) with Awards of
equivalent value, which replacement shall be binding on all Participants. In the
alternative, substantially similar consideration may be provided to Participants
as was provided to shareholders (after taking into account the existing
provisions of the Awards). The successor corporation may also issue, in place of
outstanding Shares of the Company held by the Participant, substantially similar
shares or other property subject to repurchase restrictions no less favorable to
the Participant.

      


      16.2
Other Treatment of
Awards. Subject to any greater rights granted to Participants under the
foregoing provisions of this Section 17, in the event of the occurrence of any
transaction described in Section 17.1, any outstanding Awards shall be treated
as provided in the applicable agreement or plan of merger, consolidation,
dissolution, liquidation, sale of assets or other “corporate
transaction.”

      


      16.3
Assumption of Awards
by the Company. The Company, from time to time, also may grant Awards
identical to awards granted by another company, whether in connection with an
acquisition of such other company or otherwise, by granting an Award under the
Plan in replacement of such other company’s award. Such replacement shall be
permissible if the holder of the replaced award would have been eligible to be
granted an Award under the Plan if the other company had applied the rules of
the Plan to such grant. In the event the Company grants Awards identical to an
award granted by another company, the terms and conditions of such award shall
remain unchanged (except that the exercise price and the number and nature of
Shares issuable upon exercise of any such option will be adjusted approximately
pursuant to Section 424(a) of the Code).

       

       

      
        
          
          

        

        
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      17.           Adoption and Shareholder
Approval. The Plan shall become effective on the date that it is adopted
by the Board (the “Effective Date”). The Plan shall be approved by the
shareholders of the Company (excluding Shares issued pursuant to this Plan),
consistent with applicable laws, within twelve months before or after the
Effective Date. Upon the Effective Date, the Board may grant Awards pursuant to
the Plan; provided, however, that: (a) no Option may be exercised prior to
initial shareholder approval of the Plan; (b) no Option granted pursuant to an
increase in the number of Shares approved by the Board shall be exercised prior
to the time such increase has been approved by the shareholders of the Company;
and in the event that shareholder approval is not obtained within the time
period provided herein, all Awards granted hereunder shall be canceled, any
Shares issued pursuant to any Award shall be canceled and any purchase of Shares
hereunder shall be rescinded. After the Company becomes subject to Section 16(b)
of the Exchange Act, the Company will comply with the requirements of Rule 16b-3
(or its successor), as amended, with respect to shareholder
approval.

      


      18.           Term of Plan. The
Plan will terminate ten (10) years from the Effective Date or, if earlier, the
date of shareholder approval of the Plan.

      


      19.           Amendment or Termination of
Plan. The Board may at any time terminate or amend the Plan in any
respect, including without limitation amendment of any form of Award Agreement
or instrument to be executed pursuant to the Plan; provided, however, that: (a)
the Board shall not, without the approval of the shareholders of the Company,
amend the Plan in any manner that requires such shareholder approval pursuant to
the Code or the regulations promulgated thereunder as such provisions apply to
ISO plans or pursuant to the Exchange Act or Rule 16b-3 (or its successor), as
amended, thereunder; and (b) no outstanding Award shall be deemed effected by
such amendment without the advance written consent of the Participant(s) holding
such outstanding Award(s) at the time of the proposed termination or
amendment.

      


      20.           Nonexclusivity of the Plan.
Neither the adoption of the Plan by the Board, the submission of the Plan
to the shareholders of the Company for approval, nor any provision of the Plan
shall be construed as creating any limitations on the power of the Board to
adopt such additional compensation arrangements as it may deem desirable,
including, without limitation, the granting of stock options and bonuses
otherwise than under the Plan, and such arrangements may be either generally
applicable or applicable only in specific cases.

      


      21.          
 Definitions. As used
in the Plan, the following terms shall have the following meanings:

       

      “Affiliate”
means any corporation that directly, or indirectly through one or more
intermediaries, controls or is controlled by, or is under common control with,
another corporation, where “control” (including the terms “controlled by” and
“under common control with”) means the possession, direct or indirect, of the
power to cause the direction of the management and policies of the corporation,
whether through the ownership of voting securities, by contract or
otherwise.

       

      
        
          
          

        

        
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      “Award”
means any award under the Plan, including any Option or Restricted
Stock.

      


      “Award Agreement” means, with respect
to each Award, the signed written agreement between the Company and the
Participant setting forth the terms and conditions of the Award.

      


      “Board” means the Board of Directors of
the Company.

      


      “Code” means the Internal Revenue Code
of 1986, as amended.

      


      “Board” means a Board appointed by the
Company's Compensation Board (said Compensation Board itself being first
appointed by the Company's Board).

      


      “Company” means SNAP INTERACTIVE, INC.,
a Delaware corporation, or any successor company.

      


      “Disability” means a disability,
whether temporary or permanent, partial or total, as determined by the
Board.

      


      “Disinterested Person” means a director
who has not, during the period that person is a member of the Board and for one
(1) year prior to service as a member of the Board, been granted or awarded
equity securities pursuant to the Plan or any other plan of the Company or any
Parent, Subsidiary or Affiliate of the Company, except in accordance with the
requirements set forth in Rule 16b-3(c)(2)(I) (and any successor regulation
thereto) as promulgated by the SEC under Section 16(b) of the Exchange Act, as
such rule is amended from time to time and as interpreted by the
SEC.

      


      “Exchange Act” means the Securities
Exchange Act of 1934, as amended.

      


      “Exercise Price” means the price at
which a holder of an Option may purchase the Shares issuable upon exercise of
the Option.

      


      “Fair Market Value” means, as of any
date, the value of a share of the Company’s Common Stock determined as
follows:

      


      
        	
                 
      

              	
                (a)
      if such Common Stock is then quoted on the Nasdaq market, its last
      reported sale price on the Nasdaq market or, if no such reported sale
      takes place on such date, the average of the closing bid and asked
      prices;

              


      

      


      
        	
                 
      

              	
                (b)
      if such Common Stock is publicly traded and is then listed on a national
      securities exchange, the last reported sale price or, if no such reported
      sale takes place on such date, the average of the closing bid and asked
      prices on the principal national securities exchange on which the Common
      Stock is listed or admitted to
trading;

              


      

       

       

      
        
          
          

        

        
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                (c)
      if such Common Stock is publicly traded but is not quoted on a Nasdaq
      market nor listed or admitted to trading on a national securities
      exchange, the average of the closing bid and asked prices on such date, as
      reported by The Wall Street Journal, for the over-the-counter market;
      or

              


      

      


      
        	
                 
      

              	
                (d)
      if none of the foregoing is applicable, by the Board of Directors of the
      Company in good faith.

              


      

      


      “Insider” means an officer or director
of the Company or any other person whose transactions in the Company’s Common
Stock are subject to Section 16 of the Exchange Act.

      


      “Option” means an award of an option to
purchase Shares pursuant to Section 5.

      


      “Parent” means any corporation (other
than the Company) in an unbroken chain of corporations ending with the Company,
if at the time of the granting of an Award under the Plan, each of such
corporations other than the Company owns stock possessing fifty percent (50%),
or more, of the total combined voting power of all classes of stock in one of
the other corporations in such chain.

      


      “Participant” means a person who
receives an Award under the Plan.

      


      “Plan” means this Snap Interactive,
Inc. Equity Incentive Plan, as amended from time to time.

      


      “Restricted
Stock Award” means an award of Shares pursuant to Section

      


      “SEC”
means the Securities and Exchange Commission.

      


      “Securities
Act” means the Securities Act of 1933, as amended.

      


      “Shares”
means shares of the Company’s Common Stock reserved for issuance under the Plan,
as adjusted pursuant to Sections 2 and 17, and any successor
security.

      


      “Subsidiary”
means any corporation (other than the Company) in an unbroken chain of
corporations beginning with the Company if, at the time of granting of the
Award, each of the corporations other than the last corporation in the unbroken
chain owns stock possessing fifty percent (50%), or more, of the total combined
voting power of all classes of stock in one of the other corporations in such
claim.

       

       

      
        
          
          

        

        
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      “Termination”
or “Terminated” means, for purposes of the Plan with respect to a Participant,
that the Participant has ceased to provide services as an employee, director,
consultant or advisor, to the Company or a Parent, Subsidiary or Affiliate of
the Company, except in the case of sick leave, military leave, or any other
leave of absence approved by the Board, provided, that such leave is for a
period of not more than ninety (90) days, or reinstatement upon the expiration
of such leave is guaranteed by contract or statute. The Board shall have sole
discretion to determine whether a Participant has ceased to provide services and
the effective date on which the Participant ceased to provide services (the
“Termination Date”).

      


      


      
        
          
          

        

        
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      EXERCISE
NOTICE

      


      SNAP
INTERACTIVE, INC.

      366 North
Broadway

      Suite
41042

      Jericho,
NY 11753

      


      Attention:
Stock Option Plan Administrator

      


      1.           Exercise of Option.
Effective as of today, ___________, ____, the undersigned ("Participant") hereby
elects to exercise Participant's option to purchase ________ shares of the
Common Stock (the "Shares") of Snap
Interactive, Inc. (the "Company") under and
pursuant to the Snap Interactive, Inc. Equity Incentive Plan (the "Plan") and the Stock
Option Agreement dated ______, 2008 (the "Option
Agreement").

      


      2.           Delivery of Payment.
Purchaser herewith delivers to the Company the full purchase price of the
Shares, as set forth in the Option Agreement.

      


      3.           Representations of
Participant. Participant acknowledges that Participant has received, read
and understood the Plan and the Option Agreement and agrees to abide by and be
bound by their terms and conditions.

      


      4.           Rights as
Shareholder. Until the issuance of the Shares (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company), no right to vote or receive dividends or any other rights
as a shareholder shall exist with respect to the Optioned Stock, notwithstanding
the exercise of the Option. The Shares shall be issued to the Participant as
soon as practicable after the Option is exercised.

      


      5.           Tax Consultation.
Participant understands that Participant may suffer adverse tax consequences as
a result of Participant's purchase or disposition of the Shares. Participant
represents that Participant has consulted with any tax consultants Participant
deems advisable in connection with the purchase or disposition of the Shares and
that Participant is not relying on the Company for any tax advice.

      


      6.           Successors and
Assigns. The Company may assign any of its rights under this Exercise
Notice to single or multiple assignees, and this Exercise Notice shall inure to
the benefit of the successors and assigns of the Company. Subject to the
restrictions on transfer herein set forth, this Exercise Notice shall be binding
upon Participant and his or her heirs, executors, administrators, successors and
assigns.

      


       

      
        
          
          

        

        
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      7.           Withholding Taxes.
There may be a regular federal income tax liability upon the exercise of this
Option. Participant will be treated as having received compensation income
(taxable at ordinary income tax rates) equal to the excess, if any, of the Fair
Market Value of the Shares on the date of exercise over the Exercise Price. If
Participant is an employee, the Company will be required to withhold from
Participant’s compensation or collect from Participant and pay to the applicable
taxing authorities an amount equal to a percentage of this compensation income
at the time of exercise.

       

      8.           Governing Law. This
Exercise Notice is governed by the internal substantive laws of the state of New
York.

      


      9. Entire Agreement. The
Plan and Option Agreement are incorporated herein by reference. This Exercise
Notice, the Plan, the Option Agreement constitute the entire agreement of the
parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and Participant
with respect to the subject matter hereof, and may not be modified adversely to
the Participant's interest except by means of a writing signed by the Company
and Participant.

      


      Submitted
by:                                                                              Accepted
by:

       

      


      PARTICIPANT                                                                           SNAP
INTERACTIVE, INC.

      


      ________________________________                            By:
________________________________

      Signature

      


      ________________________________                            Title:
_______________________________

      Print
Name

      


      


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