Document:

Exhibit 10.1

        SECOND AMENDMENT TO CREDIT AGREEMENT, WAIVER AND LIMITED CONSENT

     THIS SECOND AMENDMENT TO CREDIT AGREEMENT, WAIVER AND LIMITED CONSENT (this
"Amendment") is made as of the 24th day of January, 2005, among KRISPY KREME
DOUGHNUT CORPORATION, a North Carolina corporation (the "Borrower"), KRISPY
KREME DOUGHNUTS, INC., a North Carolina corporation (the "Parent"), FREEDOM
RINGS, LLC, a Delaware limited liability company, and GOLDEN GATE DOUGHNUTS,
LLC, a North Carolina corporation (collectively, the "Subsidiary Guarantors"),
MONTANA MILLS BREAD CO., INC., a Delaware corporation (the "Affiliate
Guarantor", and, collectively with the Parent and the Subsidiary Guarantors, the
"Guarantors"), the LENDERS party hereto (the "Lenders"), BRANCH BANKING AND
TRUST COMPANY, as Syndication Agent, BANK OF AMERICA, N.A. and ROYAL BANK OF
CANADA, as Co-Documentation Agents, and WACHOVIA BANK, NATIONAL ASSOCIATION, as
Administrative Agent (the "Administrative Agent") and the Issuing Lender (the
"Issuing Lender").

                                R E C I T A L S:

     The Borrower, the Administrative Agent, the Issuing Lender and the Lenders
have entered into that certain $150,000,000 Credit Agreement dated as of October
31, 2003, as amended by that certain First Amendment to Credit Agreement dated
November 2003 (as so amended, the "Credit Agreement"). Capitalized terms used in
this Amendment which are not otherwise defined in this Amendment shall have the
respective meanings assigned to them in the Credit Agreement.

     The Borrower has failed to deliver financial statements and a Compliance
Certificate for the Fiscal Quarter ended October 31, 2004 (the "Required
Financial Information") as required by Sections 6.01(b) and 6.01(c) of the
Credit Agreement (the "Existing Defaults").

     The Borrower has notified the Lenders that the information set forth in
financial statements and certificates previously delivered by the Borrower may
need to be restated or corrected as a result of the matters described and
referred to in the Form 8-K dated January 4, 2005 filed by the Borrower under
the Exchange Act (the "8-K Disclosure"), which could be deemed to have caused
such financial statements and/or certificates in the forms previously delivered
to have been incorrect or misleading, and the representations and warranties
made or deemed made by the Borrower may, or may not, as a result of such matters
described and referred to in the 8-K Disclosure, be deemed to have resulted in a
Default having occurred under Section 8.01(d) of the Credit Agreement (any such
Default which has or may have occurred being hereinafter referred to as a
"Disclosure Default").

     The Borrower has requested the Administrative Agent, the Issuing Lender and
the Lenders to provide a limited consent to a delay in delivery of the Required
Financial Information and the extension of the applicable grace period with
respect to the Existing Defaults under Section 8.01(c) of the Credit Agreement
arising from the failure to deliver the Required Financial Information and to
waive during such time any Disclosure Default which has or may

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have occurred, such consent and waiver to be subject to certain terms and
conditions as specifically set forth herein.

     The Borrower, the Administrative Agent, the Issuing Lender and the Lenders
are each willing to use its best efforts to work toward a long-term solution
with respect to the matters contained herein that is satisfactory to all parties
during the Extension Period (as hereinafter defined).

     NOW, THEREFORE, in consideration of the Recitals and the mutual promises
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by each of the parties hereto, the
parties hereto intending to be legally bound hereby, agree as follows:

     SECTION 1. Recitals. The Recitals are incorporated herein by reference and
shall be deemed to be a part of this Amendment.

     SECTION 2. Amendments. The Borrower and the Lenders hereby agree that the
Credit Agreement is hereby amended as set forth in this Section 2.

     (a) Section 4.02 of the Credit Agreement is hereby amended to delete "and"
at the end of clause (c), to substitute the period at the end of clause (d) with
a semicolon and to add new clauses (e) and (f) to read in their entirety as
follows:

          (e) if, after any Revolving Credit Borrowing or any Swing Loan
     Borrowing, the aggregate outstanding principal amount of all Revolving
     Credit Loans and Swing Loans will exceed $59,000,000, receipt by the
     Administrative Agent of the prior written consent of the Required Lenders
     to such Borrowing; and

          (f) with respect to the issuance, renewal or extension of a Letter of
     Credit, (i) the fact that immediately after such issuance, renewal or
     extension, and after giving effect to the expiration or cancellation of any
     outstanding Letters of Credit, the aggregate Letter of Credit Obligations
     do not exceed the aggregate Letter of Credit Obligations as of January 14,
     2005 and such issuance, renewal or extension is on substantially similar
     terms as applicable to the Letter of Credit being replaced, renewed or
     extended or (ii) receipt by the Administrative Agent of the prior written
     consent of the Required Lenders to the issuance, renewal or extension of
     such Letter of Credit.

     (b) Section 7.10(d) of the Credit Agreement is hereby amended and restated
in its entirety to read as follows:

          (d) Guarantees of the Borrower in respect of Debt incurred by Joint
     Ventures in an aggregate principal amount outstanding at any time not to
     exceed the amount of such Debt outstanding as of January 14, 2005; except
     that (A) (i) to the extent that any Guarantee issued prior to January 14,
     2005 permits the

                                      -2-
<PAGE>

     increase of the principal amount of the outstanding Debt secured by such
     Guarantee, such increase shall be permitted under this clause (d) and (ii)
     any new Guarantee issued under this clause (d) shall be issued on terms no
     less favorable to the Guarantor than the Guarantee that it replaces, if it
     replaces another Guarantee; (B) the Borrower may issue Guarantees after
     January 14, 2005 (other than pursuant to clause (A)) in connection with the
     refinancing of existing Guarantees of Debt not to exceed at any one time
     outstanding $5,000,000 individually or in the aggregate; and (C) the
     Borrower may issue new Guarantees after January 14, 2005 and prior to March
     25, 2005, in connection with Guarantees of Debt not to exceed at any one
     time outstanding $2,500,000 individually or in the aggregate;

     (c) Section 6.01 of the Credit Agreement is hereby amended to delete "and"
at the end of clause (k), to substitute the period at the end of clause (l) with
a semicolon and to add new clauses (m) to read in its entirety as follows:

          (m) as soon as available and in any event within thirty (30) days
     after the end of each of the first two fiscal months of any Fiscal Quarter,
     and within forty-five (45) days after the end of the last fiscal month of
     each Fiscal Quarter, a consolidated balance sheet of the Parent and its
     Consolidated Subsidiaries as of the end of the prior fiscal month and the
     related statement of income or operations for such fiscal month and for the
     portion of the Fiscal Year ended at the end of such fiscal month, setting
     forth in each case in comparative form the figures for the corresponding
     fiscal month and the corresponding portion of the previous Fiscal Year, all
     in form reasonably acceptable to the Administrative Agent; and

          (n) Tuesday of each week, beginning February 1, 2005, a rolling
     13-week cash forecast, in form reasonably acceptable to the Administrative
     Agent.

     (d) Section 11.03 of the Credit Agreement is hereby amended to add a new
sentence at the end thereof to read in its entirety as follows:

          The Borrower shall also pay all reasonable out-of-pocket expenses upon
     demand of the Administrative Agent's counsel in connection with the hiring
     and retention by the Administrative Agent's counsel of a financial advisor
     for the Lenders (including, without limitation, a reasonable retainer, if
     requested). The Administrative Agent acknowledges and agrees that any such
     financial advisor shall be bound by the terms of Section 11.09 of this
     Agreement.

     SECTION 3. Limited Consent and Waiver.

     (a) Upon the satisfaction of the conditions contained in Section 5 below,
but with effect on and after the date hereof, the Administrative Agent, the
Lenders and the Issuing Lender hereby consent to the extension from the date
hereof to March 25, 2005 (the "Extension Period") of the applicable 30-day grace
period under Section 8.01(c) of the Credit Agreement insofar

                                      -3-
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as such grace period relates to the delivery of the Required Financial
Information under either Section 6.01(b) or 6.01(c), of the Credit Agreement.

     (b) Upon the satisfaction of the conditions contained in Section 5 below,
but with effect on and after the date hereof, the Lenders hereby temporarily
waive, during the Extension Period only, any Disclosure Default. If a Disclosure
Default has occurred or is deemed to have occurred, such Disclosure Default
shall not be, and shall not be deemed to have been, an Event of Default until
the expiration of the Extension Period. Without in any regard limiting the
generality of the terms of Sections 3(c), 3(d) and 4(a) of this Amendment, the
temporary waiver hereby granted relates exclusively to the breach of Section
8.01(d) of the Credit Agreement and nothing herein shall be deemed to have
waived any other Default which may arise or may have arisen by reason of any
fact or circumstance which may be or may have been disclosed but for any
Disclosure Default including, without limitation as aforesaid, any Default under
Section 7.13 of the Credit Agreement. Moreover, this temporary waiver shall not
be deemed to have waived any right or remedy available against any Person other
than the Borrower by reason of the matters described or referred to in the 8-K
Disclosure.

     (c) The consent granted in clause (a) above and the temporary waiver
granted in clause (b) above shall be limited solely to the delivery of the
Required Financial Information and to any Disclosure Default, respectively, and
shall not be deemed to (i) be a waiver of or consent to any deviation from or
modification or amendment of any other Default which has occurred and is
continuing or which shall have occurred at any time prior to the date hereof, or
of any other term or condition of the Credit Agreement, or of any default under
any instruments or agreements referred to herein or therein, or (ii) prejudice
in any way any right or rights which the Administrative Agent, the Issuing
Lender or the Lenders may now have or may have in the future (including, without
limitation, any right or rights with respect to any Disclosure Default after the
expiration of the Extension Period) under or in connection with the Credit
Agreement or any instruments or agreements referred to herein or therein or
executed in connection herewith or therewith. The consent set forth in clause
(a) and the temporary waiver granted pursuant to clause (b) above shall not at
any time or in any way obligate the Administrative Agent, the Issuing Lender or
the Lenders to grant any other approval, waiver, or consent hereinafter
requested by the Borrower.

     (d) Except as specifically provided herein, the Administrative Agent, the
Issuing Lender and the Lenders expressly reserve all of their rights and
remedies available to them under the Credit Agreement and applicable law
(including, without limitation, any rights or remedies that may arise with
respect to any Disclosure Default after the expiration of the Extension Period).

     SECTION 4. Other Agreements.

     (a) The Borrower hereby acknowledges that (i) the limited consent granted
in Section 3(a) above is an extension of the applicable 30-day grace period
under Section 8.01(c) of the Credit Agreement and shall not be deemed to be a
waiver of the Existing Defaults, (ii) the temporary waiver granted in Section
3(b) above is effective only for the Extension Period and shall not be deemed to
be a permanent waiver of any Disclosure Default or the rights and/or remedies of
the Administrative Agent, Issuing Lender or any Lender in connection therewith

                                      -4-
<PAGE>

beyond the Extension Period and (iii) the Borrower shall continue to be in
Default under the Credit Agreement until the Required Financial Information is
delivered pursuant to the terms of the Credit Agreement.

     (b) The Borrower hereby agrees, and the Administrative Agent, Issuing
Lender and the Lenders hereby acknowledge, that until the Borrower delivers the
Required Financial Information, the provisions of the Credit Agreement that
apply (i) after the occurrence and/or during the continuance of a Default and
(ii) during the period from the date such Required Financial Information was due
to the date such Required Financial Information is delivered, shall continue to
apply; except that, during the Extension Period and so long as no other Default
(other than the Existing Defaults and any Disclosure Default) has occurred and
is continuing (A) the Issuing Lender shall extend, renew and issue Letters of
Credit under Section 3.04 of, and subject to the other conditions to issuance
contained in, the Credit Agreement, notwithstanding the continuance of the
Default arising from the Existing Defaults and the existence of any Disclosure
Default, as and to the extent that as a result of any such extension, renewal or
issuance, and after giving effect to the expiration or cancellation of any
outstanding Letters of Credit, the aggregate Letter of Credit Obligations do not
exceed the aggregate Letter of Credit Obligations as of January 14, 2005 and (B)
the Borrower may request new Revolving Credit Borrowings and Swing Line
Borrowings under Section 2.01 of, and subject to the other conditions to
Borrowings contained in, the Credit Agreement, notwithstanding the continuance
of the Default arising from the Existing Defaults and the existence of any
Disclosure Default, as and to the extent that as a result of any such Borrowing
the aggregate outstanding principal amount of all Revolving Credit Loans and
Swing Loans does not exceed $59,000,000.

     (c) The Borrower hereby agrees that if the Required Financial Information
has not been received by the Administrative Agent and each of the Lenders on or
before March 25, 2005 such failure to make such delivery in compliance with
Sections 6.01(b) and 6.01(c) of the Credit Agreement shall permit the immediate
exercise of all rights and remedies of the Administrative Agent, the Issuing
Lender and the Lenders arising from such failure.

     (d) The Borrower hereby agrees that if any Disclosure Default has occurred
then, upon expiration of the Extension Period, the Administrative Agent, the
Issuing Lender and the Lenders may immediately exercise all rights and remedies
available to them as a result of such Disclosure Default.

     (e) The Borrower shall deliver to Administrative Agent a full, complete,
and correct copy of the engagement agreement between the Borrower and Kroll
Zolfo Cooper LLC, no later than two (2) Domestic Business Days after execution
thereof. The Borrower shall notify Administrative Agent no later than one (1)
Domestic Business Day after any amendment, alteration or termination of such
engagement agreement

     (f) The Borrower has advised Lenders that, among the responsibilities of
Kroll Zolfo Cooper LLC, will be the creation of a business plan detailing its
tactical and strategic business objectives, including forecasts. The Borrower
shall deliver to Administrative Agent a true, complete, and correct copy of such
business plan no later than two (2) Domestic Business Days after completion and
appropriate corporate approval thereof.

                                      -5-
<PAGE>

     SECTION 5. Conditions to Effectiveness. The effectiveness of this Amendment
is subject to satisfaction of the following conditions:

     (a) receipt by the Administrative Agent from each of the Borrower, the
Guarantors and the Required Lenders of a duly executed counterpart of this
Amendment signed by such party;

     (b) the fact that the representations and warranties of each of the
Borrower and the Guarantors contained in Section 7 of this Amendment shall be
true on and as of the date hereof; and

     (c) receipt by the Administrative Agent from the Borrower for the ratable
account of the Lenders executing this Amendment of fees in an amount equal to
$100,000.

     SECTION 6. Limitations. Except as herein provided, the Loan Documents shall
remain unchanged and in full force and effect. The limited consent and temporary
waiver granted herein are limited solely to the Existing Defaults and any
Disclosure Default, respectively. This Amendment is not intended to effect, nor
shall be construed as, a novation. The Credit Agreement and this Amendment shall
be construed together as a single agreement. Nothing herein contained shall
waive, annul, vary or affect any provision, condition, covenant or agreement
contained in the Credit Agreement, nor affect or impair any rights, powers or
remedies under the Credit Agreement, except as herein provided. Except as
expressly provided herein, the Lenders, the Issuing Lender and the
Administrative Agent do hereby reserve all of their rights and remedies against
all parties who may be or may hereafter become secondarily liable for the
repayment of the Obligations. The Borrower and each of the Guarantors promise
and agree to perform all of the requirements, conditions, agreements and
obligations under the terms of each Loan Document to which it is a party, such
Loan Documents being hereby ratified and affirmed.

     SECTION 7. Representations and Warranties. The Borrower and each of the
Guarantors hereby represent and warrant to the Administrative Agent, the Issuing
Bank and each of the Lenders as follows:

     (a) To the best of their knowledge and belief after reasonably diligent
inquiry, and except for those matters described and referred to in the Form 8-K
dated January 4, 2005, filed by the Borrower under the Exchange Act, Borrower is
in compliance as of the date hereof with the financial covenants contained in
Section 7.13 of the Credit Agreement.

     (b) The Borrower and each of the Guarantors have the power and authority to
enter into this Amendment and to do all acts and things as are required or
contemplated hereunder to be done, observed and performed by it.

     (c) This Amendment has been duly authorized, validly executed and delivered
by one or more authorized officers of each of the Borrower and the Guarantors
and constitutes the legal, valid and binding obligation of each of the Borrower
and the Guarantors, enforceable against

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<PAGE>

each of the Borrower and the Guarantors in accordance with its terms, provided
that such enforceability is subject to general principles of equity.

     (d) The execution and delivery of this Amendment and the performance by
each of the Borrower and the Guarantors of its obligations hereunder do not and
will not require the consent or approval of any regulatory authority or
governmental authority or agency having jurisdiction over the Borrower or any
Guarantor, nor be in contravention of or in conflict with the certificate of
incorporation or bylaws of the Borrower or any Guarantor, or the provision of
any statute, or any judgment, order, indenture, instrument, agreement or
undertaking, to which the Borrower or any Guarantor is party or by which the
Borrower's or any Guarantor's assets or properties are or may become bound.

     SECTION 8. Counterparts. This Amendment may be executed in multiple
counterparts, each of which shall be deemed to be an original and all of which,
taken together, shall constitute one and the same agreement.

     SECTION 9. Governing Law. This Amendment shall be construed in accordance
with and governed by the law of the State of North Carolina (without giving
effect to its conflict of laws rules).

     SECTION 10. Headings. Section headings in this Amendment are included
herein for convenience of reference only and shall not constitute a part of this
Amendment for any other purposes.

     Section 11. Joinder of Existing Guarantors. Each Guarantor confirms,
acknowledges and agrees that each Loan Document to which it is a party is and
remains in full force and effect and shall cover the Obligations as modified by
this Amendment. Each Guarantor promises and agrees to perform all of the
requirements, conditions, agreements and obligations under the terms of its
Guaranty, said Guaranty being hereby ratified and affirmed. Except as expressly
provided herein, no Loan Document shall in any way be impaired, discharged,
diminished, or released by this Amendment.

     SECTION 12. Financial Information, etc; Representations and Warranties.
Each Lender acknowledges and agrees that any representation or warranty made or
deemed to have been made in connection with any Borrowing made (or the issuance,
renewal or extension of any Letter of Credit) during the Extension Period, shall
be deemed to have been made subject to the Existing Defaults, any Disclosure
Default and the matters described and referred to in the 8-K Disclosure and in
the other public filings made by the Borrower on or after April 16, 2004 and
prior to January 21, 2005 under the Exchange Act (the "Public Filings").
Borrower hereby acknowledges and agrees that (i) the preceding sentence is
intended solely to qualify the representations and warranties required by or
deemed to be made under the Credit Agreement in connection with any Borrowing to
be made (or the issuance, renewal or extension of any Letter of Credit) during
the Extension Period and nothing herein shall be deemed to have waived any
Default which may arise or may have arisen by reason of any fact or circumstance
which may be or may have been disclosed in connection with any Disclosure
Default or the matters described and referred to in the 8-K Disclosure or in the
Public Filings and such qualification shall be

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<PAGE>

subject to the same limitations as those applicable to the temporary waiver of
any Disclosure Default contained in Sections 3(b), 3(c) and 3(d) of this
Amendment and (ii) nothing in this Amendment shall be deemed to have waived the
requirements of Section 6.01(j) of the Credit Agreement including, without
limitation, the obligation of the Borrower to deliver the certificate therein
described within five (5) Domestic Business Days after Borrower becomes aware of
the occurrence of any Default under Section 7.13 of the Credit Agreement which
may have arisen by reason of any fact or circumstance described in or referred
to in the 8-K Disclosure or in the Public Filings, other than, in the case of
this clause (ii), the Existing Defaults or any Disclosure Default.

                     [SIGNATURES APPEAR ON FOLLOWING PAGES]

                                      -8-
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed and delivered, or have
caused their respective duly authorized officers or representatives to execute
and deliver, this Amendment as of the day and year first above written.

                                  BORROWER:

                                  KRISPY KREME DOUGHNUT
                                  CORPORATION

                                  By:     /s/ Michael C. Phalen
                                          ----------------------------------
                                  Title:  Chief Financial Officer

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<PAGE>

                                   ADMINISTRATIVE AGENT:

                                   WACHOVIA BANK, NATIONAL ASSOCIATION,
                                   as Administrative Agent,
                                   an Issuing Lender and as a Lender

                                   By:     /s/ Katherine A. Harkness
                                           ------------------------------
                                   Title:  Director

                                   LENDERS:

                                   BRANCH BANKING AND TRUST COMPANY,
                                   as Syndication Agent and as a Lender

                                   By:     /s/ Thatcher L. Townsend III
                                           ------------------------------
                                   Title:  SENIOR VICE PRESIDENT

                                   BANK OF AMERICA, N.A.,
                                   as Co-Documentation Agent and as a Lender

                                   By:     /s/
                                           -------------------------------
                                   Title:

                                   ROYAL BANK OF CANADA,
                                   as Co-Documentation Agent and as a Lender

                                   By:     /s/
                                           -------------------------------
                                   Title:

                                   CIBC INC.,
                                   as a Lender

                                   By:     /s/ Gerald Girardi
                                           -------------------------------
                                   Title:  EXECUTIVE DIRECTOR
                                           CIBC WORLD MARKETS CORP. AS AGENT

                                   THE BANK OF NOVA SCOTIA,
                                   as a Lender

                                   By:     /s/ Chris J. Allen
                                           -------------------------------
                                   Title:  Managing Director & Office Head

                                      -10-
<PAGE>

     This Amendment is hereby acknowledged by, consented and agreed to, and duly
executed and delivered as of the day and year first above.

                                  GUARANTORS:

                                  KRISPY KREME DOUGHNUTS, INC.

                                  By:     /s/ Michael C. Phalen (SEAL)
                                          --------------------------------
                                  Title:  Chief Financial Officer

                                  FREEDOM RINGS, LLC

                                  By:     /s/ Sherry Polonsky (SEAL)
                                          --------------------------------
                                  Title:  Manager

                                  MONTANA MILLS BREAD CO., INC.

                                  By:     /s/ Michael C. Phalen (SEAL)
                                          --------------------------------
                                  Title:  Vice President and Treasurer

                                  GOLDEN GATE DOUGHNUTS, LLC

                                  By:     /s/ Sherry Polonsky (SEAL)
                                          --------------------------------
                                  Title:  Manager

                                      -11-Exhibit 10.11

SECURITIES REPRESENTED BY THIS AGREEMENT HAVE NOT BEEN REGISTERED OR QUALIFIED
UNDER FEDERAL OR STATE SECURITIES LAWS. THESE SECURITIES MAY NOT BE OFFERED FOR
SALE, SOLD, PLEDGED, OR OTHERWISE DISPOSED OF UNLESS SO REGISTERED OR QUALIFIED
OR UNLESS AN EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED BY
AN OPINION OF COUNSEL TO THE REGISTERED HOLDER (WHICH OPINION AND COUNSEL SHALL
BOTH BE SATISFACTORY TO THE COMPANY).

                             INFOSONICS CORPORATION

                             STOCK OPTION AGREEMENT
            (Non-Employee Directors' Options--2003 Stock Option Plan)

     THIS STOCK OPTION AGREEMENT (the "Agreement") is made and entered into as
of the ____ day of ________ by and between InfoSonics Corporation, a Maryland
corporation (the "Company"), and ________ (the "Optionee").

                                   WITNESSETH:

     WHEREAS, effective as of ________________ the Optionee was elected as a
director of the Company;

     WHEREAS, the Company agreed to issue to Optionee an option to purchase
shares of the $.001 par value common stock of the Company ("Common Stock"), said
option to be for the number of shares, at the price per share and on the terms
set forth in this Agreement;

     WHEREAS, the Optionee is a Non-Employee Director, as defined in the
Company's 2003 Stock Option Plan (the "Plan"), and the option granted pursuant
to this Agreement constitutes a Non-Discretionary Option pursuant to the Plan;
and

     WHEREAS, the Optionee desires to receive an option on the terms and
conditions set forth in this Agreement.

     NOW, THEREFORE, the parties agree as follows:

     1. Grant Of Option. 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 the authorized and unissued $.001 par value common stock of the
Company (the "Option Shares") pursuant to the terms and conditions set forth in
this Agreement.

     2. Option Price. At any time when shares are to be purchased pursuant to
the Option, the purchase price (the "Option Price") for each Option Share shall
be equal to _______________, subject to adjustment as provided in this
Agreement.

     3. Exercise Period.

        (a) All or any portion of the Option relating to 5,000 Option Shares
shall become exercisable as follows:______________________

        (b) The period for the exercise of the Option shall terminate at 5:00
p.m., San Diego, California time on _______________ unless terminated earlier as
provided in this Agreement. Notwithstanding the foregoing, to the extent not
earlier terminated, the Option shall terminate three months after Optionee
ceases to be a director of the Company.

                                       1

<PAGE>

     4. Exercise Of Option.

        (a) The Option may be exercised in whole or in part by delivering to the
Treasurer of the Company (i) a Notice And Agreement Of Exercise Of Option,
substantially in the form attached hereto as Exhibit A, specifying the number of
Option Shares with respect to which the Option is exercised, and (ii) full
payment of the Option Price for such shares. Payment shall be made by certified
check or cleared funds. The Option may not be exercised in part unless the
purchase price for the Option Shares purchased is at least $1,000 or unless the
entire remaining portion of the Option is being exercised.

        (b) Promptly upon receipt of the Notice And Agreement Of Exercise Of
Option together with the full payment of the Option Price, the Company shall
deliver to the Optionee a properly executed certificate or certificates
representing the Option Shares being purchased.

        (c) During the lifetime of the Optionee, the Option shall be exercisable
only by the Optionee; provided, that in the event of the legal disability of an
Optionee, the guardian or personal representative of the Optionee may exercise
the Option. Following the death of the Optionee, the Option may be exercised by
the personal representative of the Optionee during any remaining term of the
Option.

        (d) (1) If for any reason (other than as a result of the removal of
Optionee as a director of the Company) the Optionee ceases to be a director of
the Company, then any Option then held by the Optionee may be exercised within
90 days after the date Optionee ceases to be a director of the Company, but only
to the extent that (A) the Option was exercisable according to its terms on the
date Optionee ceased to be a director of the Company, and (B) the period for
exercise of the Option, as defined in Section 3 of this Agreement, has not
terminated as of the date of exercise. Upon termination of the respective
periods set forth in the previous sentence, any unexercised portion of the
Option shall expire.

            (2) If the Optionee is removed as a director of the Company by a
vote of stockholders in accordance with the law of the Company's state of
incorporation, any Option held by the Optionee at the time of removal shall
expire upon delivery to the Optionee of notice of removal, which may be oral or
in writing, and all rights to purchase shares pursuant to the Option shall
terminate immediately upon the delivery of such notice of removal.

     5. Withholding Taxes. The Company may take such steps as it deems necessary
or appropriate for the withholding of any taxes which the Company is required by
any law or regulation or any governmental authority, whether federal, state or
local, domestic or foreign, to withhold in connection with the Option including,
but not limited to, the withholding of all or any portion of any payment owed by
the Company to the Optionee or the withholding of issuance of Option Shares to
be issued upon the exercise of the Option.

     6. Securities Laws Requirements. No Option Shares shall be issued unless
and until, in the opinion of the Company, there has been full compliance with,
or an exemption from, any applicable registration requirements of the Securities
Act of 1933, as amended (the "1933 Act"), any applicable listing requirements of
any securities exchange on which stock of the same class has been listed, and
any other requirements of law or any regulatory bodies having jurisdiction over
such issuance and delivery, or applicable exemptions are available and have been
complied with. Pursuant to the terms of the Notice And Agreement Of Exercise Of
Option (Exhibit A) that shall be delivered to the Company upon each exercise of
the Option, the Optionee shall acknowledge, represent, warrant and agree as
follows:

                                       2

<PAGE>

        (a) Optionee is acquiring the Option Shares for investment purposes only
and the Option Shares that Optionee is acquiring will be held by Optionee
without sale, transfer or other disposition for an indefinite period unless the
transfer of those securities is subsequently registered under the federal
securities laws or unless exemptions from registration are available;

        (b) Optionee's overall commitment to investments that are not readily
marketable is not disproportionate to Optionee's net worth and Optionee's
investment in the Option Shares will not cause such overall commitments to
become excessive;

        (c) Optionee's financial condition is such that Optionee is under no
present or contemplated future need to dispose of any portion of the Option
Shares to satisfy any existing or contemplated undertaking, need or
indebtedness;

        (d) Optionee has sufficient knowledge and experience in business and
financial matters to evaluate, and Optionee has evaluated, the merits and risks
of an investment in the Option Shares;

        (e) The address set forth on the signature page to this Agreement is
Optionee's true and correct residence, and Optionee has no present intention of
becoming a resident of any other state or jurisdiction;

        (f) Optionee confirms that all documents, records and books pertaining
to an investment in the Option and the Option Shares that have been requested by
Optionee have been made available or delivered to Optionee. Without limiting the
foregoing, Optionee has received and reviewed the Company's periodic reports as
filed with the Securities And Exchange Commission, and Optionee has had the
opportunity to discuss the acquisition of the Option and the Option Shares with
the Company, and Optionee has obtained or been given access to all information
concerning the Company that Optionee has requested;

        (g) Optionee has had the opportunity to ask questions of, and receive
the answers from, the Company concerning the terms of the investment in the
Option Shares and to receive additional information necessary to verify the
accuracy of the information delivered to Optionee, to the extent that the
Company possesses such information or can acquire it without unreasonable effort
or expense;

        (h) Optionee understands that the Options have not, and the Option
Shares issuable upon exercise of the Options will not be, registered under the
1933 Act or any state securities laws in reliance on an exemption for private
offerings, and no federal or state agency has made any finding or determination
as to the fairness of this investment or any recommendation or endorsement of
the sale of the Option Shares;

        (i) The Option Shares that Optionee is acquiring will be solely for
Optionee's own account, for investment, and are not being purchased with a view
to or for the resale, distribution, subdivision or fractionalization thereof.
Optionee has no agreement or arrangement for any such resale, distribution,
subdivision or fractionalization thereof;

        (j) Optionee acknowledges and is aware of the following:

                        (i) The Company has a history of losses. The Option
            Shares constitute a speculative investment and involve a high degree
            of risk of loss by Optionee of Optionee's total investment in the
            Option Shares.

                                       3

<PAGE>

                        (ii) There are substantial restrictions on the
            transferability of the Option Shares. The Option is not transferable
            except by will or the laws of descent and distribution, and any
            attempt to do so shall void the Option. The Option Shares cannot be
            transferred, pledged, hypothecated, sold or otherwise disposed of
            unless they are registered under the 1933 Act or an exemption from
            such registration is available and established to the satisfaction
            of the Company; investors in the Company have no rights to require
            that the Option Shares be registered; there is no right of
            presentment of the Option Shares and there is no obligation by the
            Company to repurchase any of the Option Shares; and, accordingly,
            Optionee may have to hold the Option Shares indefinitely and it may
            not be possible for Optionee to liquidate Optionee's investment in
            the Company.

                        (iii) Unless the issuance of the Option Shares is
            registered, each certificate issued representing the Option Shares
            shall be imprinted with a legend that sets forth a description of
            the restrictions on transferability of those securities, which
            legend will read substantially as follows:

                        "THE SECURITIES REPRESENTED BY THIS
                        CERTIFICATE HAVE NOT BEEN REGISTERED OR
                        QUALIFIED UNDER FEDERAL OR STATE SECURITIES
                        LAWS. THESE SECURITIES MAY NOT BE OFFERED FOR
                        SALE, SOLD, PLEDGED, OR OTHERWISE DISPOSED OF
                        UNLESS SO REGISTERED OR QUALIFIED OR UNLESS AN
                        EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS
                        TO BE ESTABLISHED BY AN OPINION OF COUNSEL TO
                        THE REGISTERED HOLDER (WHICH OPINION AND
                        COUNSEL SHALL BOTH BE SATISFACTORY TO THE
                        COMPANY)."

        (k) No Option Shares shall be sold or otherwise distributed in violation
of the 1933 Act or any other applicable federal or state securities laws;

        (l) The Company may, without liability for its good faith actions, place
legend restrictions upon the certificates representing the Option Shares and
issue "stop transfer" instructions requiring compliance with applicable
securities laws and the terms of the Option.

        (m) The Optionee shall report all sales of Option Shares to the Company
in writing on a form prescribed by the Company; and

        (n) If and so long as the Optionee is subject to reporting requirements
under Section 16(a) of the 1934 Act, the Optionee shall (i) be aware that any
sale by the Optionee or the Optionee's immediate family of shares of the
Company's Common Stock or any of the Option Shares within six months before or
after any transaction deemed to be a "purchase" of an equity security of the
Company may create liability for the Optionee under Section 16(b) of the 1934
Act, (ii) consult with the Optionee's counsel regarding the application of
Section 16(b) of the 1934 Act prior to any exercise of the Option, and prior to
any sale of shares of the Company's Common Stock or the Option Shares, (iii)
furnish the Company with a copy of each Form 4 filed by the Optionee's, and (iv)
timely file all reports required under the federal securities laws.

        The restrictions described in this Section 6, or notice thereof, may be
placed on the certificates representing the Option Shares purchased pursuant to
the Option, and the Company may refuse to issue the certificates or to transfer
the Option Shares on its books unless it is satisfied that no violation of such
restrictions will occur.

                                       4

<PAGE>

     7. Transferability Of Option. No Option shall be transferable by the
Optionee otherwise than by will or by the laws of descent and distribution or
pursuant to a domestic relations order (within the meaning of Rule 12a-12
promulgated under the 1934 Act), and Options shall be exercisable during the
lifetime of an Optionee only by the Optionee or the Optionee's guardian or legal
representative. Notwithstanding the foregoing, Options may be transferred to
Permitted Transferees (as defined below) of the Optionee, and for purposes of
this Agreement, a Permitted Transferee of an Optionee shall be deemed to be the
Optionee. The terms of an Option shall be final, binding and conclusive upon the
beneficiaries, executors, administrators, heirs and successors of the Optionee.
A "Permitted Transferee" means Optionee's immediate family, trusts solely for
the benefit of such family members and partnerships in which such family members
and/or trusts are the only partners. For this purpose, immediate family of a
person means the person's spouse, parents, children, stepchildren and
grandchildren and the spouses of such parents, children, stepchildren and
grandchildren.

     8. Adjustment By Stock Split, Stock Dividend, Etc. If at any time the
Company increases or decreases the number of its outstanding shares of common
stock, or changes in any way the rights and privileges of such shares, by means
of the payment of a stock dividend or the making of any other distribution on
such shares payable in its common stock, or through a stock split or subdivision
of shares, or a consolidation or combination of shares, or through a
reclassification or recapitalization involving its common stock, the numbers,
rights and privileges of the shares of common stock included in the Option shall
be increased, decreased or changed in like manner as if such shares had been
issued and outstanding, fully paid and nonassessable at the time of such
occurrence.

     9. Merger Or Consolidation.

        (a) Upon the occurrence of any of the following events, and subject to
the 30-day period provided for in Subsection 9(b), the Option shall
automatically terminate and be of no further force or effect whatever if and
only if the notice described in Subsection 9(b) has been given to Optionee: (i)
the merger or consolidation of the Company with one or more other corporations,
regardless of which entity survives the transaction; (ii) the dissolution or
liquidation of the Company; (iii) the appointment of a receiver for all, or
substantially all, of the Company's assets or business; (iv) the appointment of
a trustee for the Company after a petition has been filed for the Company's
reorganization under applicable statutes; or (v) the sale, lease or exchange of
all, or substantially all, of the Company's assets and business.

        (b) If any of the events described in clauses (i), (ii), (iii), (iv), or
(v) of Subsection 9(a) occurs, then the Company, at the Company's option, may
cause the Option to terminate and be of no further force or effect whatever if
the Company gives written notice to the Optionee at least 30 days prior to the
occurrence of any such event. After receipt of such notice, the Optionee may at
any time before the occurrence of the event requiring the giving of notice
exercise the unexercised portion of the Option as to all the shares covered
thereby and without regard to the restrictions set forth in Subparagraphs 3(a)
and 3(b), except that the portion of the Option thereby becoming exercisable
that shall be considered an incentive stock option shall be subject to the
limitations of Section 16 of the Plan. Notwithstanding the foregoing, if the
notice given under this Subsection 9(b) is given fewer than 30 days prior to
occurrence of the event, then the Option shall not terminate pursuant to
Subsection 9(a), and may be exercised, until 30 days after the date on which the
notice was given. If no notice shall be given with respect to a transaction
described in clauses (i), (ii), or (v) of Subsection 9(a), the provisions of
Subsection 9(a) shall not apply and the Option shall not terminate until the
termination is pursuant to Subsection 9(a) or any other applicable provision of
this Agreement. Notice pursuant to this Subsection 9(b) shall be given pursuant
to the provisions of Section 14 of this Agreement.

     10. Registration Rights. Optionee shall have no registration rights unless
otherwise agreed by the Company.

                                       5

<PAGE>

     11. Common Stock To Be Received Upon Exercise. Optionee understands that
(a) the Company is under no obligation to register the issuance of the Option
Shares, and (b) in the absence of any such registration, the Option Shares
cannot be sold unless they are sold pursuant to an exemption from registration
under the 1933 Act. Optionee also understands that with respect to Rule 144,
routine sales of securities made in reliance upon such Rule can be made only in
limited amounts in accordance with the terms and conditions of the Rule, and
that in cases in which the Rule is inapplicable, compliance with either
Regulation A or another disclosure exemption under the 1933 Act will be
required. Thus, the Option Shares will have to be held indefinitely in the
absence of registration under the 1933 Act or an exemption from registration.

         Furthermore, the Optionee fully understands that issuance of the Option
Shares will not be registered under the 1933 Act and that, because the issuance
of the Option Shares will not be registered, the Option Shares will be issued in
reliance upon an exemption which is available only if Optionee acquires such
shares for investment and not with a view to distribution. Optionee is familiar
with the phrase "acquired for investment and not with a view to distribution" as
it relates to the 1933 Act and the special meaning given to such term in various
releases of the Securities And Exchange Commission.

     12. Privilege Of Ownership. Optionee shall not have any of the rights of a
stockholder with respect to the shares covered by the Option except to the
extent that one or more certificates for such shares shall be delivered to him
upon exercise of the Option.

     13. Relationship To Employment Or Position. Nothing contained in this
Agreement (i) shall confer upon the Optionee any right with respect to
employment or continuance of service as a director of the Company, or (ii) shall
interfere in any way with the right of the Company at any time to remove
Optionee as a director of the Company or determine not to nominate Optionee for
an additional term as a director.

     14. Notices. All notices, requests, demands, directions and other
communications ("Notices") concerning this Agreement shall be in writing and
shall be mailed or delivered personally or sent by telecopier or facsimile to
the applicable party at the address of such party set forth below in this
Section 14. When mailed, each such Notice shall be sent by first class,
certified mail, return receipt requested, enclosed in a postage prepaid wrapper,
and shall be effective on the fifth business day after it has been deposited in
the mail. When delivered personally, each such Notice shall be effective when
delivered to the address for the respective party set forth in this Section 14,
provided that it is delivered on a business day and further provided that it is
delivered prior to 5:00 p.m., local time of the party to whom the notice is
being delivered, on that business day; otherwise, each such Notice shall be
effective on the first business day occurring after the Notice is delivered.
When sent by telecopier or facsimile, each such Notice shall be effective on the
day on which it is sent provided that it is sent on a business day and further
provided that it is sent prior to 5:00 p.m., local time of the party to whom the
Notice is being sent, on that business day; otherwise, each such Notice shall be
effective on the first business day occurring after the Notice is sent. Each
such Notice shall be addressed to the party to be notified as shown below:

         (a)                     if to the Company:
                                 InfoSonics Corporation 5880
                                 Pacific Center Drive San
                                 Diego, California 92121
                                 Facsimile No. (858)
                                 373-1503 Attention:
                                 President

         (b) if to the Optionee: ________________
                                 At the address set forth on the signature page
                                 of this Agreement

                                       6

<PAGE>

         Either party may change its respective address for purposes of this
Section 14 by giving the other party Notice of the new address in the manner set
forth above.

     15. General Provisions. This instrument (a) contains the entire agreement
between the parties, (b) may not be amended nor may any rights hereunder be
waived except by an instrument in writing signed by the party sought to be
charged with such amendment or waiver, (c) shall be construed in accordance
with, and governed by the laws of California, except where conflicts of law
rules require the application of Maryland law, and (d) shall be binding upon and
shall inure to the benefit of the parties and their respective personal
representatives and assigns, except as above set forth. All pronouns contained
herein and any variations thereof shall be deemed to refer to the masculine,
feminine or neuter, singular or plural as the identity of the parties hereto may
require.

     IN WITNESS WHEREOF, the parties have executed this Agreement on the dates
set forth below.

                                            INFOSONICS CORPORATION

Date:____________________                   By:________________________________

                                            ___________________________________
                                            Printed Name And Title

                                            OPTIONEE

Date:____________________                   ___________________________________

                                       7

<PAGE>

                                    EXHIBIT A
                                    ---------
                           (To InfoSonics Corporation
                             Stock Option Agreement)

                             INFOSONICS CORPORATION

                   NOTICE AND AGREEMENT OF EXERCISE OF OPTION

     I hereby exercise my InfoSonics Corporation Stock Option dated as of
__________ as to ________ shares of the $.001 par value common stock (the
"Option Shares") of InfoSonics Corporation (the "Company") at a purchase price
of $____ per share. The total exercise price for these Option Shares is
$________. Enclosed is payment in the form of ___________________.

     Enclosed is the payment specified in Paragraph 4 of my Option Agreement.

     I understand that no Option Shares will be issued unless and until, in the
opinion of the Company, there has been full compliance with any applicable
registration requirements of the Securities Act of 1933, as amended, any
applicable listing requirements of any securities exchange on which stock of the
same class is then listed, and any other requirements of law or any regulatory
bodies having jurisdiction over such issuance and delivery. I hereby
acknowledge, represent, warrant and agree, to and with the Company as follows:

     a.   The Option Shares I am purchasing are being acquired for my own
          account for investment purposes only and with no view to their resale
          or other distribution of any kind, and no other person (except, if I
          am married, my spouse) will own any interest therein. (Note: This
          provision to be included only if issuance of Option Shares is not
          registered at the time of exercise.)

     b.   I will not sell or dispose of my Option Shares in violation of the
          Securities Act of 1933, as amended, or any other applicable federal or
          state securities laws.

     c.   I agree that the Company may, without liability for its good faith
          actions, place legend restrictions upon my Option Shares and issue
          "stop transfer" instructions requiring compliance with applicable
          securities laws and the terms of my Option.

     d.   I will report all sales of Option Shares to the Company in writing on
          a form prescribed by the Company.

     e.   If and so long as I am subject to reporting requirements under Section
          16(a) of the 1934 Act), I recognize that any sale by me or my
          immediate family of the Company's $.001 par value common stock may
          create liability for me under Section 16(b) of the 1934 Act ("Section
          16(b)"). Therefore, I have consulted with my counsel regarding the
          application of Section 16(b) to this exercise of my Option.

     f.   I will consult with my counsel regarding the application of Section
          16(b) before I make any sale of the Company's $.001 par value common
          stock, including the Option Shares, and I will furnish the Company
          with a copy of each Form 4 or Form 5 filed by me and will timely file
          all reports that I may be required to file under the federal
          securities laws.

                                       8

<PAGE>

The number of Option Shares specified above are to be issued in the name or
names set forth below in the left-hand column.

-----------------------------               -----------------------------------
(Print Your Name)                           Signature

-----------------------------               -----------------------------------
(Optionee - Print Name of Spouse            Address
if you wish joint registration)
                                            -----------------------------------
                                            City, State and Zip Code

                                       9

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