Document:

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Exhibit 10.9

                              SEPARATION AGREEMENT
                              --------------------

     THIS AGREEMENT entered into as of the 19th day of February, 2001 by and
between eOn COMMUNICATIONS CORPORATION, a Delaware corporation ("eOn", "Company"
or "Employer") and ROBERT CASH, a resident of Tennessee ("Employee").

     WHEREAS, Employer has accepted Employee's resignation as Vice President and
Chief Marketing Officer, effective December 20th, 2000

     WHEREAS, Employer and Employee wish to formalize the terms of Employee's
termination of employment and upon the terms and conditions hereinafter set
forth.

     NOW, THEREFORE, in consideration of the above premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

                                    Article 1
                                Term of Agreement

This Agreement shall be effective as of the date of its execution and shall
continue in force in perpetuity except for those articles in which some other
term of duration or date of termination is provided.

                                   Article 2.
                           Compensation and Severance

In consideration of Employee's past service and in order to secure Employee's
availability to assist the Company in connection with financial issues and other
matters that occurred on or prior to January 31, 2001, eOn will provide the
following compensation and severance benefits to Employee:

  1.      Continuation for the period through April 15, 2001, of Employee's
     present base salary and fringe benefits (except as noted in Item 3 below)
     in conjunction with services described in the opening paragraph of Article
     2.

  2.      Severance pay for the period April 16 through June 8, 2001 to be paid
     through the Company's normal bi-weekly payroll system.

  3.      Payment for accrued but unused vacation days through February 16,
     2001, payable on the first business day following April 15, 2001.

  4.      Employee may continue to contribute to the eOn Medical Plan at the
     employee rate through the end the month during which his last severance
     payment is received, extending his coverage through the end of the month of
     June 2001. He will then have sixty (60) days from the end of June 2001 to
     make a decision about continuing medical coverage at his own expense under
     the provisions of the COBRA program.

  5.      In keeping with the provisions of the governing versions of the
     Company's Equity Incentive Plan, employee will have ninety (90) days from
     April 15, 2001 within which to exercise his vested stock options.

  6.      Employee may retain his laptop computer for his personal use. Employee
     agrees to make the laptop available to eOn personnel for purposes of
     collecting a backup of information and data on the computer.

  7.      Any confidentiality agreements signed by Employee will remain in full
     force and effect as provided in the terms of those agreements.

To the extent that any provisions of this Article of this Agreement conflict
with the provisions of the agreement between Employee and the Company dated
December 20, 2000, the provisions of this Agreement will govern.

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                                   Article 3.
                             Services to be Provided

In consideration of the severance and other compensation provided herein, the
employee shall make himself available through July 31, 2001, to answer questions
regarding matters in which he has been involved. Employee may respond to such
requests for information at times that are reasonable and do not interfere with
his responsibilities to any subsequent employer.

                                   Article 4.
                            Confidential Information

     In consideration of the compensation and benefits to be paid or provided to
Employee by Employer under this Agreement, Employee covenants as follows:

     1)   Employee agrees and acknowledges that through the nature of his work,
he has had access to and may acquire proprietary information and knowledge
concerning the business and operations of Employer and its Affiliates including,
without limitation, information about its trade secrets, current and proposed
products, present and potential customers, vendor relationships, financial
information, sales and marketing plans, technical, engineering, and test data,
employees, intellectual property, and business models (collectively, the
"Confidential Information"). Employee acknowledges that all such Confidential
Information is the property of Employer and its Affiliates solely and
constitutes valuable, proprietary and confidential information of Employer and
its Affiliates; that the disclosure thereof would cause substantial loss to the
goodwill of Employer and its Affiliates; that disclosure thereof to Employee is
being or has been made only because of the position of trust and confidence
which he has occupied and will occupy and because of his agreement to the
restrictions herein contained. Employee shall not, at any time, divulge,
disseminate, disclose or communicate to any Person any Confidential Information,
either during or after the term of this agreement, which information Employee
shall hold in trust in a fiduciary capacity for the sole benefit of Employer,
its Affiliates, and their successors and assigns.

     2)   None of the foregoing obligations and restrictions applies to any part
of the Confidential Information that Employee demonstrates was or became
generally available to the public other than as a result of a disclosure by
Employee.

     3)   Employee will not remove from Employer's premises (except to the
extent such removal is for purposes of the performance of Employee's duties at
home or while traveling, or except as otherwise specifically authorized by
Employer) any document, record, notebook, plan, model, component, device, or
computer software or code, whether embodied in a disk or in any other form
(collectively, the "Proprietary Items"). Employee recognizes that, as between
Employer and Employee, all of the Proprietary Items, whether or not developed by
Employee, are the exclusive property of Employer. No later than February 16,
2001, Employee will return to eOn all of the Proprietary Items in Employee's
possession or subject to Employee's control except as provided in Article 2. 6.
of this Agreement, and Employee shall not retain any copies, abstracts,
sketches, or other physical embodiment of any of the Proprietary Items.

     4)   The Employee acknowledges that the Employee Confidentiality Agreement
and the Agreement for Assignment of Inventions and Covenant Against Disclosure
previously executed by the Employee remain in full force and effect during and
after the term of this Agreement and after the termination of his employment.

     5)   The parties agree that, in addition to any damages otherwise
available, the damages, whether financial or otherwise, in the event of a breach
of this Article by the Employee, would be irreparable, and that damages from
such breach would not be an adequate remedy. The Employee therefore agrees that
an injunction from a court of competent jurisdiction will be available if the
Employee violates

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or threatens to violate the terms of this Article, in addition to any other
remedy at law or equity available to the Employer under this Agreement or under
any applicable law.

                                   Article 5.
                               Releases and Waiver
                               -------------------

     The Employee hereby fully releases the Employer, its affiliates, officers,
directors, employees, and agents from any and all claims of whatever kind or
character under federal, state, or local law or regulation, including but not
limited to the Age Discrimination in Employment Act of 1967, as amended, all
civil rights acts, and any other statutes or common law concerning employment
discrimination or otherwise. In consideration of that release, the Employer
likewise releases the Employee from any and all claims existing as of the date
of this Agreement.

     The Employer acknowledges and agrees that the Employee has been covered by
the Employer's director and officer liability insurance policy. Notwithstanding
Employee's part-time employment pursuant to this Agreement or termination of his
employment at any time, whether due to termination of this Agreement or
otherwise, the Employer shall continue to cover Employee under its director and
officer insurance policy to the extent allowed by the provisions of such policy
with respect to his conduct and activities during the period when he was an
officer and/or director of the Employer. The provisions of this paragraph shall
survive the termination of this Agreement for a period of six years.

     This Release does not constitute a waiver of any rights or claims under the
Age Discrimination in Employment Act that may arise after the date that this
Agreement is signed. The Employee further acknowledges that he is receiving
consideration beyond anything of value to which he is already entitled. The
Employee understands that he has up to 21 days to consider whether to sign this
Release and Agreement. By signing this Release and Agreement on the date shown
below, the Employee voluntarily elects to forego waiting 21 days to sign this
Release and Agreement. The Employee also acknowledges that he has been fully
advised by Employer of his right to revoke and nullify this Release and
Agreement, which right must be exercised, if at all, within seven days of the
date of his signature. Any revocation of this Agreement must be in writing
addressed to the Company as follows:

                                  Troy Lynch
                                  eOn Communications Corporation
                                  4105 Royal Drive
                                  Kennesaw, GA 30144

                                   Article 6.
                                  Miscellaneous
                                  -------------

         11.1 Waiver. The rights and remedies of the parties to this Agreement
are cumulative and not alternative. Neither the failure nor any delay by either
party in exercising any right, power, or privilege under this Agreement will
operate as a waiver of such right, power, or privilege, and no single or partial
exercise of any such right, power, or privilege will preclude any other or
further exercise of such right, power, or privilege or the exercise of any other
right, power, or privilege. To the maximum extent permitted by applicable law,
(a) no claim or right arising out of this Agreement can be discharged by one
party, in whole or in part, by a waiver or renunciation of the claim or right
unless in writing signed by the other party; (b) no waiver that may be given by
a party will be applicable except in the specific instance for which it is
given; and (c) no notice to or demand on one party will be deemed to be a waiver
of any obligation of such party or of the right of the party giving such notice
or demand to take further action without notice or demand as provided in this
Agreement.

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     11.2    Binding Effect; Delegation of Duties Prohibited. This Agreement
shall inure to the benefit of, and shall be binding upon, the parties hereto and
their respective successors, assigns, heirs, and legal representatives,
provided, however, that this Agreement may be assigned by Employer only with the
prior written consent of Employee, which consent shall not be unreasonably
withheld. The duties and covenants of Employee under this Agreement, being
personal, may not be delegated.

     11.3    Entire Agreement; Amendments. This Agreement contains the entire
agreement between the parties with respect to the subject matter hereof and
supersede all prior agreements and understandings, oral or written, between the
parties hereto with respect to the subject matter hereof. This Agreement may not
be amended orally, but only by an agreement in writing signed by the parties
hereto.

     11.4    Severability. If any provision of this Agreement is held invalid or
unenforceable by any court of competent jurisdiction, the other provisions of
this Agreement will remain in full force and effect. Any provision of this
Agreement held invalid or unenforceable only in part or degree will remain in
full force and effect to the extent not held invalid or unenforceable.

     11.5    Governing Law; Venue. This Agreement shall be governed by and
construed in accordance with the domestic laws of the State of Georgia without
giving effect to any choice or conflict of law provision or rule (whether of the
State of Georgia or any other jurisdiction) that would cause the application of
the laws of any jurisdiction other than the State of Georgia. Each of the
parties submits to the jurisdiction of any state or federal court sitting in
Atlanta, Georgia, in any action or proceeding arising out of or relating to this
Agreement and agrees that all claims in respect of the action or proceeding
shall be heard and determined in any such court. Each party also agrees not to
bring any action or proceeding arising out of or relating to this Agreement in
any other court. Each of the parties waives any defense of inconvenient forum to
the maintenance of any action or proceeding so brought and waives any bond,
surety, or other security that might be required of any other party with respect
thereto

     11.6    Arbitration. Subject to the provisions set forth herein below, any
disputes, claims or controversies ("claims") arising out of and related to the
interpretation and application of this Agreement, or any amendment thereto,
including any alleged breach hereof, or any claims otherwise arising out of or
related to Employee's employment, including, any claims governed by any law,
state or federal, relating to employment shall be referred to and resolved by
Arbitration which shall be conducted in accordance with the then current
Commercial Arbitration Rules of the American Arbitration Association ("AAA")
before an arbitrator who is licensed to practice law in the State of Georgia.
The arbitration shall take place in Atlanta, Georgia, at a mutually acceptable
site. Provided, however, this arbitration clause shall not apply to or cover
claims for worker's compensation or claims for injunctive or equitable relief
arising out of or relating to the enforcement by the Employer of any of the
restrictive covenants set forth in Article 8 and Article 9 or elsewhere in this
Agreement.

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     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed and delivered as of the day and date first above written.

     eOn COMMUNICATIONS CORPORATION

     /s/ Troy E. Lynch
     ---------------------------------------------------
                          TROY E. LYNCH

     Date:              February 19, 2001
          ----------------------------------------------

     /s/ Robert R. Cash
     ---------------------------------------------------
                         ROBERT R. CASH

     Date:              February 19, 2001
          ----------------------------------------------<PAGE>

10.1              2001 Non-Qualified Stock Compensation Plan

                   2001 NON-QUALIFIED STOCK COMPENSATION PLAN

1.       PURPOSE OF PLAN

         1.1 This 2001 NON-QUALIFIED STOCK COMPENSATION PLAN (the "Plan") of
H-Entertainment, Inc. (the "Company") for employees, directors and other persons
associated with the Company, is intended to advance the best interests of the
Company by providing those persons who have a substantial responsibility for its
management and growth with additional incentive and by increasing their
proprietary interest in the success of the Company, thereby encouraging them to
maintain their relationships with the Company. Further, the availability and
offering of stock options and restricted stock under the Plan supports and
increases the Company's ability to attract and retain individuals of exceptional
talent upon whom, in large measure, the sustained progress, growth and
profitability of the Company depends.

2.       DEFINITIONS

         2.1 For Plan purposes, except where the context might clearly indicate
otherwise, the following terms shall have the meanings set forth below:

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

         "Committee" shall mean the Compensation Committee, or such other
committee appointed by the Board, which shall be designated by the Board to
administer the Plan, or the Board if no committees have been established. The
Committee shall be composed of three or more persons as from time to time are
appointed to serve by the Board. Each member of the Committee, while serving as
such, shall be a disinterested person with the meaning of Rule 16b-3 promulgated
under the Securities Exchange Act of 1934.

         "Common Shares" shall mean the Company's Common Shares, $.01 par
value per share, or, in the event that the outstanding Common Shares are
hereafter changed into or exchanged for different shares of securities of the
Company, such other shares or securities.

         "Company" shall mean H-Entertainment, Inc., a Nevada corporation, and
any parent or subsidiary corporation of H-Entertainment, Inc., as such terms are
defined in Sections 425(e) and 425(f), respectively, of the Code.

         "Fair Market Value" shall mean, with respect to the date a given stock
option is granted or exercised, the average of the highest and lowest reported
sales prices of the Common Shares, as reported by such responsible reporting
service as the Committee may select, or if there were not transactions in the
Common Shares on such day, then the last preceding day on which transactions
took place. The above withstanding, the Committee may determine the Fair Market
Value in such other manner as it may deem more equitable for Plan purposes or as
is required by applicable laws or regulations.

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         "Optionee" shall mean an employee of the company who has been granted
one or more Stock Options under the Plan.

         "Restricted Stock" shall mean shares of common stock which are issued
by the Company pursuant to Section 5, below.

         "Restricted Stockholder" means the employee of, consultant to, or
director of the Company or other person to whom shares of Restricted Stock are
issued pursuant to this Plan.

         "Restricted Stock Agreement" means an agreement executed by a
Restricted Stockholder and the Company as contemplated by Section 5, below,
which imposes on the shares of Restricted Stock held by the Restricted
Stockholder such restrictions as the Board or Committee deem appropriate.

         "Stock Option" or "Non-Qualified Stock Option" or "NQSO" shall mean a
stock option granted pursuant to the terms of the Plan.

         "Stock Option Agreement" shall mean the agreement between the Company
and the Optionee under which the Optionee may purchase Common Shares hereunder.

3.       ADMINISTRATION OF THE PLAN

         3.1 The Committee shall administer the Plan and accordingly, it shall
have full power to grant Stock Options and Restricted Stock, construe and
interpret the Plan, establish rules and regulations and perform all other acts,
including the delegation of administrative responsibilities, it believes
reasonable and proper.

         3.2 The determination of those eligible to receive Stock Options and
Restricted Stock, and the amount, type and timing of each grant and the terms
and conditions of the respective stock option agreements and restricted stock
agreements shall rest in the sole discretion of the Committee, subject to the
provisions of the Plan.

         3.3 The Committee may cancel any Stock Options awarded under the Plan
if an Optionee conducts himself in a manner which the Committee determines to be
inimical to the best interest of the Company, as set forth more fully in
paragraph 8 of Article 11 of the Plan.

         3.4 The Board, or the Committee, may correct any defect, supply any
omission or reconcile any inconsistency in the Plan, or in any granted Stock
Option, in the manner and to the extent it shall deem necessary to carry it into
effect.

         3.5 Any decision made, or action taken, by the Committee or the Board
arising out of or in connection with the interpretation and administration of
the Plan shall be final and conclusive.

                                       2
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         3.6 Meetings of the Committee shall be held at such times and places as
shall be determined by the Committee. A majority of the members of the Committee
shall constitute a quorum for the transaction of business, and the vote of a
majority of those members present at any meeting shall decide any question
brought before that meeting. In addition, the Committee may take any action
otherwise proper under the Plan by the affirmative vote, taken without a
meeting, of a majority of its members.

         3.7 No member of the Committee shall be liable for any act or omission
of any other member of the Committee or for any act or omission on his own part,
including, but not limited to, the exercise of any power or discretion given to
him under the Plan, except those resulting from his own gross negligence or
willful misconduct.

         3.8 The Company, through its management, shall supply full and timely
information to the Committee on all matters relating to the eligibility of
Optionees, their duties and performance, and current information on any
Optionee's death, retirement, disability or other termination of association
with the Company, and such other pertinent information as the Committee may
require. The Company shall furnish the Committee with such clerical and other
assistance as is necessary in the performance of its duties hereunder.

4.       SHARES SUBJECT TO THE PLAN

         4.1 The total number of shares of the Company available for grants of
Stock Options and Restricted Stock under the Plan shall be 6,000,000 Common
Shares, subject to adjustment in accordance with Article 7 of the Plan, which
shares may be either authorized but unissued or reacquired Common Shares of the
Company.

         4.2 If a Stock Option or portion thereof shall expire or terminate for
any reason without having been exercised in full, the unpurchased shares covered
by such NQSO shall be available for future grants of Stock Options.

5.       AWARD OF RESTRICTED STOCK

         5.1 The Board or Committee from time to time, in its absolute
discretion, may (a) award Restricted Stock to employees of, consultants to, and
directors of the Company, and such other persons as the Board or Committee may
select, and (b) permit Holders of Options to exercise such Options prior to full
vesting therein and hold the Common Shares issued upon exercise of the Option as
Restricted Stock. In either such event, the owner of such Restricted Stock shall
hold such stock subject to such vesting schedule as the Board or Committee may
impose or such vesting schedule to which the Option was subject, as determined
in the discretion of the Board or Committee.

         5.2 Restricted Stock shall be issued only pursuant to a Restricted
Stock Agreement, which shall be executed by the Restricted Stockholder and the
Company and which shall contain such terms and conditions as the Board or
Committee shall determine consistent with this Plan, including such restrictions
on transfer as are imposed by the Restricted Stock Agreement.

                                       3
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         5.3 Upon delivery of the shares of Restricted Stock to the Restricted
Stockholder, below, the Restricted Stockholder shall have, unless otherwise
provided by the Board or Committee, all the rights of a stockholder with respect
to said shares, subject to the restrictions in the Restricted Stock Agreement,
including the right to receive all dividends and other distributions paid or
made with respect to the Restricted Stock.

         5.4. Notwithstanding anything in this Plan or any Restricted Stock
Agreement to the contrary, no Restricted Stockholders may sell or otherwise
transfer, whether or not for value, any of the Restricted Stock prior to the
date on which the Restricted Stockholder is vested therein.

         5.5 All shares of Restricted Stock issued under this Plan (including
any shares of Common Stock and other securities issued with respect to the
shares of Restricted Stock as a result of stock dividends, stock splits or
similar changes in the capital structure of the Company) shall be subject to
such restrictions as the Board or Committee shall provide, which restrictions
may include, without limitation, restrictions concerning voting rights,
transferability of the Restricted Stock and restrictions based on duration of
employment with the Company, Company performance and individual performance;
provided that the Board or Committee may, on such terms and conditions as it may
determine to be appropriate, remove any or all of such restrictions. Restricted
Stock may not be sold or encumbered until all applicable restrictions have
terminated or expire. The restrictions, if any, imposed by the Board or
Committee or the Board under this Section 5 need not be identical for all
Restricted Stock and the imposition of any restrictions with respect to any
Restricted Stock shall not require the imposition of the same or any other
restrictions with respect to any other Restricted Stock.

         5.6 Each Restricted Stock Agreement shall provide that the Company
shall have the right to repurchase from the Restricted Stockholder the unvested
Restricted Stock upon a termination of employment, termination of directorship
or termination of a consultancy arrangement, as applicable, at a cash price per
share equal to the purchase price paid by the Restricted Stockholder for such
Restricted Stock.

         5.7 In the discretion of the Board or Committee, the Restricted Stock
Agreement may provide that the Company shall have the a right of first refusal
with respect to the Restricted Stock and a right to repurchase the vested
Restricted Stock upon a termination of the Restricted Stockholder's employment
with the Company, the termination of the Restricted Stockholder's consulting
arrangement with the Company, the termination of the Restricted Stockholder's
service on the Company's Board, or such other events as the Board or Committee
may deem appropriate.

         5.8 The Board or Committee shall cause a legend or legends to be placed
on certificates representing shares of Restricted Stock that are subject to
restrictions under Restricted Stock Agreements, which legend or legends shall
make appropriate reference to the applicable restrictions.

                                       4
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6.       STOCK OPTION TERMS AND CONDITIONS

         6.1 Consistent with the Plan's purpose, Stock Options may be granted to
non-employee directors of the Company or other persons who are performing or who
have been engaged to perform services of special importance to the management,
operation or development of the Company.

         6.2 All Stock Options granted under the Plan shall be evidenced by
agreements which shall be subject to applicable provisions of the Plan, and such
other provisions as the Committee may adopt, including the provisions set forth
in paragraphs 2 through 11 of this Section 6.

         6.3 All Stock Options granted hereunder must be granted within ten
years from the earlier of the date of this Plan is adopted or approved by the
Company's shareholders.

         6.4 No Stock Option granted to any employee or 10% Shareholder shall be
exercisable after the expiration of ten years from the date such NQSO is
granted. The Committee, in its discretion, may provide that an Option shall be
exercisable during such ten year period or during any lesser period of time.

                  The Committee may establish installment exercise terms for a
Stock Option such that the NQSO becomes fully exercisable in a series of
cumulating portions. If an Optionee shall not, in any given installment period,
purchase all the Common Shares which such Optionee is entitled to purchase
within such installment period, such Optionee's right to purchase any Common
Shares not purchased in such installment period shall continue until the
expiration or sooner termination of such NQSO. The Committee may also accelerate
the exercise of any NQSO. However, no NQSO, or any portion thereof, may be
exercisable until thirty (30) days following date of grant ("30-Day Holding
Period.").

         6.5 A Stock Option, or portion thereof, shall be exercised by delivery
of (i) a written notice of exercise of the Company specifying the number of
common shares to be purchased, and (ii) payment of the full price of such Common
Shares, as fully set forth in paragraph 6 of this Section 6.

                  No NQSO or installment thereof shall be exercisable except
with respect to whole shares, and fractional share interests shall be
disregarded. Not less than 100 Common Shares may be purchased at one time unless
the number purchased is the total number at the time available for purchase
under the NQSO. Until the Common Shares represented by an exercised NQSO are
issued to an Optionee, he shall have none of the rights of a shareholder.

         6.6 The exercise price of a Stock Option, or portion thereof, may be
paid:

                  A. In United States dollars, in cash or by cashier's check,
certified check, bank draft or money order, payable to the order of the Company
in an amount equal to the option price; or

                                       5
<PAGE>

                  B. At the discretion of the Committee, through the delivery of
fully paid and nonassessable Common Shares, with an aggregate Fair Market Value
on the date the NQSO is exercised equal to the option price, provided such
tendered Shares have been owned by the Optionee for at least one year prior to
such exercise; or

                  C. By a combination of both A and B above.

                  The Committee shall determine acceptable methods for tendering
Common Shares as payment upon exercise of a Stock Option and may impose such
limitations and prohibitions on the use of Common Shares to exercise an NQSO as
it deems appropriate.

         6.7 With the Optionee's consent, the Committee may cancel any Stock
Option issued under this Plan and issue a new NQSO to such Optionee.

         6.8 Except by will or the laws of descent and distribution, no right or
interest in any Stock Option granted under the Plan shall be assignable or
transferable, and no right or interest of any Optionee shall be liable for, or
subject to, any lien, obligation or liability of the Optionee. Stock Options
shall be exercisable during the Optionee's lifetime only by the Optionee or the
duly appointed legal representative of an incompetent Optionee.

         6.9 If the Optionee shall die while associated with the Company or
within three months after termination of such association, the personal
representative or administrator of the Optionee's estate or the person(s) to
whom an NQSO granted hereunder shall have been validly transferred by such
personal representative or administrator pursuant to the Optionee's will or the
laws of descent and distribution, shall have the right to exercise the NQSO for
one year after the date of the Optionee's death, to the extent (i) such NQSO was
exercisable on the date of such termination of employment by death, and (ii)
such NQSO was not exercised, and (iii) the exercise period may not be extended
beyond the expiration of the term of the Option.

                  No transfer of a Stock Option by the will of an Optionee or by
the laws of descent and distribution shall be effective to bind the Company
unless the Company shall have been furnished with written notice thereof and an
authenticated copy of the will and/or such other evidence as the Committee may
deem necessary to establish the validity of the transfer and the acceptance by
the transferee or transferee of the terms and conditions by such Stock Option.

                  In the event of death following termination of the Optionee's
association with the Company while any portion of an NQSO remains exercisable,
the Committee, in its discretion, may provide for an extension of the exercise
period of up to one year after the Optionee's death but not beyond the
expiration of the term of the Stock Option.

         6.10 Any Optionee who disposes of Common Shares acquired on the
exercise of a NQSO by sale or exchange either (i) within two years after the
date of the grant of the NQSO under which the stock was acquired, or (ii) within
one year after the acquisition of such Shares, shall notify the Company of such
disposition and of the amount realized upon such disposition. The transfer of
Common Shares may also be restricted by applicable provisions of the Securities
Act of 1933, as amended.

                                       6
<PAGE>

7.       ADJUSTMENTS OR CHANGES IN CAPITALIZATION

         7.1 In the event that the outstanding Common Shares of the Company are
hereafter changed into or exchanged for a different number or kind of shares or
other securities of the Company by reason of merger, consolidation, other
reorganization, recapitalization, reclassification, combination of shares, stock
split-up or stock dividend:

                  A. Prompt, proportionate, equitable, lawful and adequate
adjustment shall be made of the aggregate number and kind of shares subject to
Stock Options which may be granted under the Plan, such that the Optionee shall
have the right to purchase such Common Shares as may be issued in exchange for
the Common Shares purchasable on exercise of the NQSO had such merger,
consolidation, other reorganization, recapitalization, reclassification,
combination of shares, stock split-up or stock dividend not taken place;

                  B. Rights under unexercised Stock Options or portions thereof
granted prior to any such change, both as to the number or kind of shares and
the exercise price per share, shall be adjusted appropriately, provided that
such adjustments shall be made without change in the total exercise price
applicable to the unexercised portion of such NQSO's but by an adjustment in the
price for each share covered by such NQSO's; or

                  C. Upon any dissolution or liquidation of the Company or any
merger or combination in which the Company is not a surviving corporation, each
outstanding Stock Option granted hereunder shall terminate, but the Optionee
shall have the right, immediately prior to such dissolution, liquidation, merger
or combination, to exercise his NQSO in whole or in part, to the extent that it
shall not have been exercised, without regard to any installment exercise
provisions in such NQSO.

         7.2 The foregoing adjustments and the manner of application of the
foregoing provisions shall be determined solely by the Committee, whose
determination as to what adjustments shall be made and the extent thereof, shall
be final, binding and conclusive. No fractional Shares shall be issued under the
Plan on account of any such adjustments.

8.       MERGER, CONSOLIDATION OR TENDER OFFER

         8.1 If the Company shall be a party to a binding agreement to any
merger, consolidation or reorganization or sale of substantially all the assets
of the Company, each outstanding Stock Option shall pertain and apply to the
securities and/or property which a shareholder of the number of Common Shares of
the Company subject to the NQSO would be entitled to receive pursuant to such
merger, consolidation or reorganization or sale of assets.

         8.2 In the event that:

                  A. Any person other than the Company shall acquire more than
20% of the Common Shares of the Company through a tender offer, exchange offer
or otherwise;

                  B. A change in the "control" of the Company occurs, as such
term is defined in Rule 405 under the Securities Act of 1933;

                                       7
<PAGE>

                  C. There shall be a sale of all or substantially all of the
assets of the Company;

any then outstanding Stock Option held by an Optionee, who is deemed by the
Committee to be a statutory officer ("Insider") for purposes of Section 16 of
the Securities Exchange Act of 1934 shall be entitled to receive, subject to any
action by the Committee revoking such an entitlement as provided for below, in
lieu of exercise of such Stock Option, to the extent that it is then
exercisable, a cash payment in an amount equal to the difference between the
aggregate exercise price of such NQSO, or portion thereof, and, (i) in the event
of an offer or similar event, the final offer price per share paid for Common
Shares, or such lower price as the Committee may determine to conform an option
to preserve its Stock Option status, times the number of Common Shares covered
by the NQSO or portion thereof, or (ii) in the case of an event covered by B or
C above, the aggregate Fair Market Value of the Common Shares covered by the
Stock Option, as determined by the Committee at such time.

         8.3 Any payment which the Company is required to make pursuant to
paragraph 8.2 of this Section 8 shall be made within 15 business days, following
the event which results in the Optionee's right to such payment. In the event of
a tender offer in which fewer than all the shares which are validly tendered in
compliance with such offer are purchased or exchanged, then only that portion of
the shares covered by an NQSO as results from multiplying such shares by a
fraction, the numerator of which is the number of Common Shares acquired
pursuant to the offer and the denominator of which is the number of Common
Shares tendered in compliance with such offer shall be used to determine the
payment thereupon. To the extent that all or any portion of a Stock Option shall
be affected by this provision, all or such portion of the NQSO shall be
terminated.

         8.4 Notwithstanding paragraphs 8.1 and 8.3 of this Section 8, the
Committee may, by unanimous vote and resolution, unilaterally revoke the
benefits of the above provisions; provided, however, that such vote is taken no
later than ten business days following public announcement of the intent of an
offer or the change of control, whichever occurs earlier.

9.       AMENDMENT AND TERMINATION OF PLAN

         9.1 The Board may at any time, and from time to time, suspend or
terminate the Plan in whole or in part or amend it from time to time in such
respects as the Board may deem appropriate and in the best interest of the
Company.

         9.2 No amendment, suspension or termination of this Plan shall, without
the Optionee's consent, alter or impair any of the rights or obligations under
any Stock Option theretofore granted to him under the Plan.

         9.3 The Board may amend the Plan, subject to the limitations cited
above, in such manner as it deems necessary to permit the granting of Stock
Options meeting the requirements of future amendments or issued regulations, if
any, to the Code.

         9.4 No NQSO may be granted during any suspension of the Plan or after
termination of the Plan.

                                       8
<PAGE>

10.      GOVERNMENT AND OTHER REGULATIONS

         10.1 The obligation of the Company to issue, transfer and deliver
Common Shares for Stock Options exercised under the Plan shall be subject to all
applicable laws, regulations, rules, orders and approval which shall then be in
effect and required by the relevant stock exchanges on which the Common Shares
are traded and by government entities as set forth below or as the Committee in
its sole discretion shall deem necessary or advisable. Specifically, in
connection with the Securities Act of 1933, as amended, upon exercise of any
Stock Option, the Company shall not be required to issue Common Shares unless
the Committee has received evidence satisfactory to it to the effect that the
Optionee will not transfer such shares except pursuant to a registration
statement in effect under such Act or unless an opinion of counsel satisfactory
to the Company has been received by the Company to the effect that such
registration is not required. Any determination in this connection by the
Committee shall be final, binding and conclusive. The Company may, but shall in
no event be obligated to, take any other affirmative action in order to cause
the exercise of a Stock Option or the issuance of Common Shares pursuant thereto
to comply with any law or regulation of any government authority.

11.      MISCELLANEOUS PROVISIONS

         11.1 No person shall have any claim or right to be granted a Stock
Option or Restricted Stock under the Plan, and the grant of an NQSO or
Restricted Stock under the Plan shall not be construed as giving an Optionee or
Restricted Stockholder the right to be retained by the Company. Furthermore, the
Company expressly reserves the right at any time to terminate its relationship
with an Optionee with or without cause, free from any liability, or any claim
under the Plan, except as provided herein, in an option agreement, or in any
agreement between the Company and the Optionee.

         11.2 Any expenses of administering this Plan shall be borne by the
Company.

         11.3 The payment received from Optionee from the exercise of Stock
Options under the Plan shall be used for the general corporate purposes of the
Company.

         11.4 The place of administration of the Plan shall be in the State of
California, and the validity, construction, interpretation, administration and
effect of the Plan and of its rules and regulations, and rights relating to the
Plan, shall be determined solely in accordance with the laws of the State of
Nevada.

         11.5 Without amending the Plan, grants may be made to persons who are
foreign nationals or employed outside the United States, or both, on such terms
and conditions, consistent with the Plan's purpose, different from those
specified in the Plan as may, in the judgment of the Committee, be necessary or
desirable to create equitable opportunities given differences in tax laws in
other countries.

                                       9
<PAGE>

         11.6 In addition to such other rights of indemnification as they may
have as members of the Board or the Committee, the members of the Committee
shall be indemnified by the Company against all costs and expenses reasonably
incurred by them in connection with any action, suit or proceeding to which they
or any of them may be party by reason of any action taken or failure to act
under or in connection with the Plan or any Stock Option granted thereunder, and
against all amounts paid by them in settlement thereof (provided such settlement
is approved by independent legal counsel selected by the Company) or paid by
them in satisfaction of a judgment in any such action, suit or proceeding,
except a judgment based upon a finding of bad faith; provided that upon the
institution of any such action, suit or proceeding a Committee member shall, in
writing, give the Company notice thereof and an opportunity, at its own expense,
to handle and defend the same, with counsel acceptable to the Optionee, before
such Committee member undertakes to handle and defend it on his own behalf.

         11.7 Stock Options may be granted under this Plan from time to time, in
substitution for stock options held by employees of other corporations who are
about to become employees of the Company as the result of a merger or
consolidation of the employing corporation with the Company or the acquisition
by the Company of the assets of the employing corporation or the acquisition by
the Company of stock of the employing corporation as a result of which it
becomes a subsidiary of the Company. The terms and conditions of such substitute
stock options so granted may vary from the terms and conditions set forth in
this Plan to such extent as the Board of Directors of the Company at the time of
grant may deem appropriate to conform, in whole or in part, to the provisions of
the stock options in substitution for which they are granted, but no such
variations shall be such as to affect the status of any such substitute stock
options as a stock option under Section 422A of the Code.

         11.8 Notwithstanding anything to the contrary in the Plan, if the
Committee finds by a majority vote, after full consideration of the facts
presented on behalf of both the Company and the Optionee, that the Optionee has
been engaged in fraud, embezzlement, theft, insider trading in the Company's
stock, commission of a felony or proven dishonesty in the course of his
association with the Company or any subsidiary corporation which damaged the
Company or any subsidiary corporation, or for disclosing trade secrets of the
Company or any subsidiary corporation, the Optionee shall forfeit all
unexercised Stock Options and all exercised NQSO's under which the Company has
not yet delivered the certificates and which have been earlier granted to the
Optionee by the Committee. The decision of the Committee as to the cause of an
Optionee's discharge and the damage done to the Company shall be final. No
decision of the Committee, however, shall affect the finality of the discharge
of such Optionee by the Company or any subsidiary corporation in any manner.

12.      WRITTEN AGREEMENT

         12.1 Each Stock Option granted hereunder shall be embodied in a written
Stock Option Agreement which shall be subject to the terms and conditions
prescribed above and shall be signed by the Optionee and by the President or any
Vice President of the Company, for and in the name and on behalf of the Company.
Such Stock Option Agreement shall contain such other provisions as the
Committee, in its discretion shall deem advisable.

                                       10
<PAGE>

Number of Shares:                               Date of Grant:
                  -------------------------                    --------------

                  FORM OF NON-QUALIFIED STOCK OPTION AGREEMENT

         AGREEMENT made this ________ day of _____________ 200 , between
__________________ (the "Optionee"), and H-Entertainment, Inc. (the "Company").

         1.       GRANT OF OPTION

                  The Company, pursuant to the provisions of the Non-qualified
Stock Compensation Plan (the "Plan"), adopted by the Board of Directors on ,
2001, the Company hereby grants to the Optionee, subject to the terms and
conditions set forth or incorporated herein, an option to purchase from the
Company all or any part of an aggregate of shares of its $.01 par value common
stock, as such common stock is now constituted, at the purchase price of $ per
share. The provisions of the Plan governing the terms and conditions of the
Option granted hereby are incorporated in full herein by reference.

         2.       EXERCISE

                  The Option evidenced hereby shall be exercisable in whole or
in part on or after and on or before , provided that the cumulative number of
shares of common stock as to which this Option may be exercised (except in the
event of death, retirement, or permanent and total disability, as provided in
paragraph 6.9 of the Plan) shall not exceed the following amounts:

         Cumulative Number                  Prior to Date
             of Shares                   (Note Inclusive of)
             ---------                   -------------------

The Option evidenced hereby shall be exercisable by the delivery to and receipt
by the Company of (i) written notice of election to exercise, in the form set
forth in Attachment B hereto, specifying the number of shares to be purchased;
(ii) accompanied by payment of the full purchase price thereof in cash or
certified check payable to the order of the Company, or by fully paid and
nonassessable common stock of the Company properly endorsed over to the Company,
or by a combination thereof, and (iii) by return of this Stock Option Agreement
for endorsement of exercise by the Company on Schedule I hereof. In the event
fully paid and nonassessable common stock is submitted as whole or partial
payment for shares to be purchased hereunder, such common stock will be valued
at their Fair Market Value (as defined in the Plan) on the date such shares
received by the Company are applied to payment of the exercise price.

                                       11
<PAGE>

         3.       TRANSFERABILITY

                  The Option evidenced hereby is not assignable or transferable
by the Optionee other than by the Optionee's will or by the laws of descent and
distribution, as provided in paragraph 6.9 of the Plan. The Option shall be
exercisable only by the Optionee during his lifetime.

                                                     H-Entertainment, Inc.

                                                     By:
                                                        ------------------------
                                                     Name:
ATTEST:                                              Title:

Secretary

         Optionee hereby acknowledges receipt of a copy of the Plan, attached
hereto and accepts this Option subject to each and every term and provision of
such Plan. Optionee hereby agrees to accept as binding, conclusive and final,
all decisions or interpretations of the of the Board of Directors administering
the Plan on any questions arising under such Plan. Optionee recognizes that if
Optionee's employment with the Company or any subsidiary thereof shall be
terminated without cause, or by the Optionee, prior to completion or
satisfactory performance by Optionee (except as otherwise provided in paragraph
6 of the Plan) all of the Optionee's rights hereunder shall thereupon terminate;
and that, pursuant to paragraph 6 of the Plan, this Option may not be exercised
while there is outstanding to Optionee any unexercised Stock Option granted to
Optionee before the date of grant of this Option.

Dated:_________________       __________________________________________________
                              Optionee

                              __________________________________________________
                              Print Name

                              __________________________________________________
                              Address

                              __________________________________________________
                              Social Security No.

                                       12
<PAGE>

ATTACHMENT B

                               NOTICE OF EXERCISE

To:      H-Entertainment, Inc.

         (1) The undersigned hereby elects to purchase ________ shares of Common
Shares (the "Common Shares"), of H-Entertainment, Inc. pursuant to the terms of
the attached Non-Qualified Stock Option Agreement, and tenders herewith payment
of the exercise price in full, together with all applicable transfer taxes, if
any.

         (2) Please issue a certificate or certificates representing said shares
of Common Shares in the name of the undersigned or in such other name as is
specified below:

                  -------------------------------
                  (Name)

                  -------------------------------
                  (Address)
                  -------------------------------

Dated:

                                                     ---------------------------
                                                     Signature

                                       13
<PAGE>

Optionee:                                   Date of Grant:
         -----------------------------                     ---------------------

                                                     SCHEDULE I

<TABLE>
<CAPTION>
============================ ============================ ==================== ====================== ==============
                                                                               UNEXERCISED            ISSUING
                                                                               SHARES                 OFFICER
DATE                         SHARES PURCHASED             PAYMENT RECEIVED     REMAINING              INITIALS
---------------------------- ---------------------------- -------------------- ---------------------- --------------
<S>                          <C>                          <C>                  <C>                    <C>

---------------------------- ---------------------------- -------------------- ---------------------- --------------

---------------------------- ---------------------------- -------------------- ---------------------- --------------

---------------------------- ---------------------------- -------------------- ---------------------- --------------

---------------------------- ---------------------------- -------------------- ---------------------- --------------

---------------------------- ---------------------------- -------------------- ---------------------- --------------

---------------------------- ---------------------------- -------------------- ---------------------- --------------

---------------------------- ---------------------------- -------------------- ---------------------- --------------

---------------------------- ---------------------------- -------------------- ---------------------- --------------

---------------------------- ---------------------------- -------------------- ---------------------- --------------

---------------------------- ---------------------------- -------------------- ---------------------- --------------

---------------------------- ---------------------------- -------------------- ---------------------- --------------

---------------------------- ---------------------------- -------------------- ---------------------- --------------

============================ ============================ ==================== ====================== ==============
</TABLE>

                                       14

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