Exhibit
10.1




LIGHTNING
GAMING, INC.


2007
EQUITY INCENTIVE PLAN


INCENTIVE
STOCK OPTION AGREEMENT




This
INCENTIVE STOCK OPTION AGREEMENT (this “Option Agreement”), dated as of the ____
day of ________________ (the “Grant Date”), is between Lightning Gaming, Inc., a
Nevada corporation (the “Company”), and _______________ (the “Optionee”), a key
employee of the Company or of a “Related Corporation,” as defined in the
Lightning Gaming, Inc.2007 Equity Incentive Plan (the “Plan”).




WHEREAS,
the Company desires to give the Optionee the opportunity to purchase shares of
common stock of the Company (“Common Stock”) in accordance with the provisions
of the Plan, a copy of which is attached hereto;




NOW
THEREFORE, in consideration of the mutual covenants hereinafter set forth and
for other good and valuable consideration, the parties hereto, intending to be
legally bound hereby, agree as follows:




1.           Grant of Option Subject to
the Plan.  The Company hereby grants to the Optionee the right
and option (the “Option”) to purchase all or any part of an aggregate of
________ shares of Common Stock. The Option is in all respects limited and
conditioned as hereinafter provided, and is subject in all respects to the terms
and conditions of the Plan now in effect and as it may be amended from time to
time (but only to the extent that such amendments apply to outstanding options).
Such terms and conditions are incorporated herein by reference, made a part
hereof, and shall control in the event of any conflict with any other terms of
this Option Agreement. The Option granted hereunder is intended to be an
incentive stock option (“ISO”) meeting the requirements of the Plan and section
422 of the Internal Revenue Code of 1986, as amended (the “Code”), and not a
nonqualified stock option (“NQSO”).




The
Optionee acknowledges that he or she has received a copy of the Plan together
with, or prior to receipt of, this Option Agreement and that he or she has fully
reviewed the Plan.




2.           Exercise
Price.  The exercise price of the shares of Common Stock
covered by this Option shall be $____ per share. It is the determination of the
“Committee” (as defined in the Plan) that on the Grant Date the exercise price
was not less than the greater of (i) 100% (110% for an Optionee who owns more
than 10% of the total combined voting power of all shares of stock of the
Company or of a Related Corporation (a “More-Than-10% Owner”)) of the “Fair
Market Value” (as defined in the Plan) of a share of Common Stock, or (ii) the
par value of a share of Common Stock.




3.           Term.  Unless
earlier terminated pursuant to any provision of the Plan or this Option
Agreement, this Option shall expire on ______________________ (the
“Expiration




1


Date”),
which date is not more than 10 years (five years in the case of a More-Than-10%
Owner) from the Grant Date. This Option shall not be exercisable on or after the
Expiration Date.




4.           Exercise of
Option.  The Optionee shall have the right to purchase from the
Company, on and after the following vesting dates, the following number of
shares of Common Stock subject to the Option, provided the Optionee has not
terminated his or her service as of the applicable vesting date:




Date
      Installment Becomes
              Exercisable (Vesting Date)
            Number of Shares




Notwithstanding
the above, the Option shall be fully vested on the date of a Change in Control.
A Change in Control shall be deemed to occur for this purpose if:




(i)           A
person, including a “group” as such term is used in Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended, becomes the beneficial owner,
directly or indirectly, of 50.1% or more of the total voting power or fair
market value of stock of the Company.




(ii)           There
is a sale of all or substantially all the assets of the Company.




(iii)           There
is a merger or consolidation of the Company as a result of which the individuals
and entities who were the beneficial owners of the stock of the Company do not
beneficially own, immediately after such merger or consolidation, directly or
indirectly, 50.1% or more of the total voting power and fair market value of the
stock resulting from such merger or consolidation in substantially the same
proportion as their ownership of the stock of the Company prior to such merger
or consolidation.




The
Committee may accelerate any vesting date of the Option, in its discretion, if
it deems such acceleration to be desirable. Once the Option becomes vested, it
will remain vested and exercisable until it is exercised or until it
terminates.




5.           Method of Exercising
Option. Subject to the terms and conditions of this Option Agreement and
the Plan, the Option may be exercised by written notice to the Company at its
principal office, which is presently located at 106 Chelsea Parkway, Boothwyn,
Pennsylvania 19061. The form of such notice is attached hereto and shall state
the election to exercise the Option and the number of whole shares with respect
to which it is being exercised; shall be signed by the person or persons so
exercising the Option; and shall be accompanied by payment of the full exercise
price of such shares. Only full shares will be issued.




2


The
exercise price shall be paid to the Company -




(a)           in
cash, or by check (acceptable to the Company), bank draft, or money
order;




(b)           through
the delivery of shares of Common Stock previously acquired by the
Optionee;




(c)           in
shares of Common Stock newly acquired by the Optionee upon the exercise of the
Option; or




(d)           in
any combination of (a), (b), or (c) above.




In the
event the exercise price is paid, in whole or in part, with shares of Common
Stock, the portion of the exercise price so paid shall be equal to the Fair
Market Value of the Common Stock surrendered on the date of exercise. In the
event the exercise price is paid with shares of Common Stock newly acquired or
with shares acquired through exercise of an ISO which have not been held for a
period of not less than the holding period described in section 422(a)(1) of the
Code, a disqualifying disposition shall result.




Upon
receipt of notice of exercise and payment, the Company shall deliver a
certificate or certificates representing the shares with respect to which the
Option is so exercised. The Optionee shall obtain the rights of a shareholder
upon receipt of the certificate(s) representing such Common Stock.




Such
certificate(s) shall be registered in the name of the person so exercising the
Option (or, if the Option is exercised by the Optionee and if the Optionee so
requests in the notice exercising the Option, shall be registered in the name of
the Optionee and the Optionee’s spouse jointly, with right of survivorship), and
shall be delivered as provided above to, or upon the written order of, the
person exercising the Option. In the event the Option is exercised by any person
after the death or “Disability” (as defined in the Plan) of the Optionee, the
notice shall be accompanied by appropriate proof of the right of such person to
exercise the Option. All shares that are purchased upon exercise of the Option
as provided herein shall be fully paid and non-assessable.




6.           Shares to be Purchased for
Investment. Unless the Company has notified the Optionee that a
registration statement covering the shares to be acquired upon the exercise of
the Option has become effective under the Securities Act of 1933, as amended
(the “Act”), and the Company has not thereafter notified the Optionee that such
registration statement is no longer effective, it shall be a condition to any
exercise of this Option that the shares acquired upon such exercise be acquired
for investment and not with a view to distribution, and the person effecting
such exercise shall submit to the Company a certificate of such investment
intent, together with such other evidence supporting the same as the Company may
request. The Company shall be entitled to restrict the transferability of the
shares issued upon any such exercise to the extent necessary to avoid a risk of
violation of the Act (or of any rules or regulations promulgated




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thereunder),
or of any state laws or regulations. Such restrictions may, at the option of the
Company, be noted or set forth in full on the share certificates.




7.           Non-Transferability of
Option. This Option is not assignable or transferable, in whole or in
part, by the Optionee other than by will or by the laws of descent and
distribution.  During the lifetime of the Optionee, the Option shall
be exercisable only by the Optionee or, in the event of his or her Disability,
by his or her guardian or legal representative.




8.           Termination of
Employment.  If the Optionee’s employment with the Company and
all Related Corporations is terminated prior to the Expiration Date, for any
reason, other than for “Cause” (as defined in the Plan), death or Disability,
this Option may be exercised by the Optionee, to the extent of the number of
shares with respect to which the Optionee could have exercised it immediately
before such termination of employment, at any time prior to the earlier of (i)
the Expiration Date or (ii) three months after such termination of employment.
Any part of the Option that was not exercisable immediately before the
Optionee’s termination of employment shall terminate at that time. In the event
the Optionee’s employment is terminated for Cause, this Option (regardless of
the extent to which it was then exercisable) shall terminate in its entirety on
the date of such termination of employment.




9.           Disability.  If
the Optionee incurs a Disability during his or her employment and, prior to the
Expiration Date, the Optionee’s employment is terminated as a consequence of
such Disability, this Option may be exercised by the Optionee or by the
Optionee’s legal representative, to the extent of the number of shares with
respect to which the Optionee could have exercised it immediately before such
termination of employment, at any time prior to the earlier of (i) the
Expiration Date or (ii) one year after such termination of employment. Any part
of the Option that was not exercisable immediately before the Optionee’s
termination of employment shall terminate at that time.




10.           Death.  If
the Optionee dies during his or her employment and prior to the Expiration Date,
or if the Optionee’s employment is terminated for any other reason except Cause
(as described in Paragraphs 8 and 9) and the Optionee dies following his or her
termination of employment but prior to the earlier of (i) the Expiration Date,
or (ii) the expiration of the period determined under Paragraph 8 or 9 (as
applicable to the Optionee) this Option may be exercised, to the extent of the
number of shares with respect to which the Optionee could have exercised it on
the date of his or her death by the Optionee’s estate, personal representative
or beneficiary who acquired the right to exercise this Option by bequest or
inheritance or by reason of the Optionee’s death, at any time prior to the
earlier of (i) the Expiration Date or (ii) one year after the date of the
Optionee’s death. Any part of the Option that was not exercisable immediately
before the Optionee’s death shall terminate at that time.




11.           Disqualifying Disposition of
Option Shares.  The Optionee agrees to give written notice to
the Company, at its principal office, if a “disposition” of the shares acquired
through exercise of the Option occurs at any time within two years after the
Grant Date or within one year after the issuance to the Optionee of such shares.
Optionee acknowledges that if such disposition occurs, the Optionee generally
will recognize ordinary income as of the date the Option was exercised in an
amount equal to the lesser of (i) the Fair Market Value of the
shares




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of Common
Stock on the date of exercise minus the exercise price, or (ii) the amount
realized on disposition of such shares minus the exercise price. For purposes of
this Paragraph, the term “disposition” shall have the meaning assigned to such
term by section 424(c) of the Code.




12.           Rights as a
Shareholder.  The issuance of a stock certificate shall be
conditioned upon the Optionee’s execution of any Shareholders Agreement in
effect at such time.




13.           Governing
Law.  This Option Agreement shall be governed by the applicable
Code provisions to the maximum extent possible. Otherwise, the laws of the State
of Nevada (without reference to principles of conflict of laws) shall govern the
operation of, and the rights of the Optionee under, the Plan and the
Option.




IN
WITNESS WHEREOF, this Option Agreement has been duly executed by the Company and
the Optionee as of the date first set forth above.






LIGHTNING
GAMING, INC.:







By:  ______________________________


Name:


Title:








OPTIONEE:








Name:







5


LIGHTNING
GAMING, INC.


2007
EQUITY INCENTIVE PLAN




Notice of
Exercise of Incentive Stock Option




I hereby
exercise the incentive stock option granted to me pursuant to the Incentive
Stock Option Agreement dated as of __________________, ___ (the “Option”), by
Lightning Gaming, Inc. (the “Company”), with respect to the following number of
shares of the Company’s common stock (“Shares”) covered by the
Option:




Number of
Shares to be purchased:




Purchase
price per Share:




Total
purchase
price:                                                                                       $




____
            A.
            Enclosed
      is cash or my check, bank draft, or money order in the amount of
      $_____________ in full/partial [circle one]payment for
      such Shares;




and/or




____
            B.
            Enclosed
      is/are
            Share(s)
      with a total fair market value of $________ on the date hereof in
      full/partial [circle one]payment for such Shares;




and/or




____
            C.
            I
      elect to satisfy the payment for Shares purchased hereunder by having the
      Company withhold newly acquired Shares pursuant to the exercise of the
      Option and recognize that this constitutes a disqualifying disposition of
      such Shares.




Please
have the certificate or certificates representing the purchased Shares
registered in the following name or names*:
__________________________________________ and sent to
___________________________________________________.




If the
condition in Paragraph 6 (“Shares to be Purchased for Investment”) of the
Incentive Stock Option Agreement related to the Shares purchased hereby is
applicable, the undersigned hereby certifies that the Shares purchased hereby
are being acquired for investment and not with a view to distribution of such
Shares.










DATE:Optionee’s
      Signature







*
      Certificates may be registered in the name of the Optionee alone or in the
      joint names (with right of survivorship) of the Optionee and his or her
      spouse.