Document:

exhibit_10-1.htm

    
      

    

    Exhibit 10.1

     

    STOCK PURCHASE
AGREEMENT

    

    

    THIS
AGREEMENT made and entered into as of the 29th day of March, 2006, by and
between Dimensional Visions Incorporated, a Delaware corporation (hereinafter
called “DVSO”), and Studio One Entertainment, Inc., an Arizona corporation
(hereinafter called “SOE”).

    

    WITNESSETH
THAT:

     

    A.          DVSO
is a publicly traded company.

    B.           SOE
is a private company based in Scottsdale, Arizona that is engaged in the design
and manufacturing of a proprietary, self contained interactive audio/video
recording and conferencing studio designed for installation in shopping malls
and other high traffic public areas. The Studio One Kiosk will enable the
public, for a fee, to record their video and voice images in a portable
state-of-the-art recording studio environment and enter their performances in
music, modeling and other talent related contests.

    

    C.           Subject
to the approval of the Board of Directors of DVSO and SOE and the consent of a
majority of the shareholders of DVSO and SOE, DVSO and SOE shall enter into an
Agreement of Exchange (hereinafter called the “Exchange Agreement”) in
substantially the form attached hereto and made apart hereof as Exhibit A, which
provides, among other things, for the issuance by DVSO of approximately six
million five hundred thousand (6,500,000) of its common stock shares to the
shareholders of SOE (the “Exchange”).

    

    D.           Following
the Exchange under the Exchange Agreement, SOE will be a wholly-owned subsidiary
of DVSO.

    

    E.           It
is intended that the transactions contemplated by this Agreement shall
constitute an exchange conforming to the provisions of Section 368(a)(2) of the
Internal Revenue Code of 1954.

    

    NOW
THEREFORE, in consideration of the mutual covenants and agreements and the
benefits to be realized by each of the parties, the following transactions are
hereby agreed to, subject to the conditions hereinafter stated:

    

    1.           The
Exchange

    

    (a)           In
accordance with the Exchange Agreement, on the Closing Date hereinafter referred
to, and in exchange for all of the then issued and outstanding shares of capital
stock of SOE (the “SOE Common Stock”), DVSO shall issue the number of fully paid
and nonassessable shares of voting DVSO common stock (hereinafter called “DVSO
Common Stock”) in order to permit the Exchange to be effected in accordance with
the terms of the Exchange Agreement, on the basis of one (1) share of DVSO
Common Stock for each one (1) share of SOE Common Stock.

    

    If
between the date hereof and the Closing Date, DVSO shall effect any
reclassification, recapitalization, subdivision, combination or exchange of
shares, in respect of the outstanding shares of common stock of DVSO or a stock
dividend thereon shall be declared with a record date within said period, the
per share amounts of DVSO Common Stock to be issued and delivered in the
Exchange shall be appropriately adjusted.

    

    (b)           DVSO
shall issue and deliver as and when required by the Exchange Agreement,
certificates representing the shares of DVSO Common Stock for which the shares
of SOE Common Stock outstanding immediately prior to the effective time of the
Exchange shall have been exchanged as provided in the Exchange
Agreement.

    

    (c)           SOE
shall submit this Agreement and the Exchange Agreement to its shareholders for
approval, in accordance with Arizona General Corporation Law, at a meeting
called and held on the date to be fixed by its Board of Directors. SOE shall use
its best efforts to obtain the affirmative vote of shareholders required to
approve this Agreement, the Exchange Agreement and the transactions contemplated
herein and therein.

    
      
        
        

      

      
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STOCK PURCHASE
AGREEMENT

     

    1.           The
Exchange - continued

     

    (d)           DVSO
shall use it best efforts to obtain the affirmative consent of shareholders
required to approve the issues set forth in paragraph 14(e) below at a meeting
or by written consent.

    

    (e)           Following
the approval of the Exchange Agreement by the stockholders of DVSO and SOE, and
upon execution of the Exchange Agreement by the officers of DVSO and SOE, a
Certificate of Exchange containing the information required by the corporate law
of Delaware and Arizona shall be executed by the appropriate officers of DVSO
and SOE.

    

    2.           Closing

    

    (a)           The
closing of the transaction contemplated hereby (herein called the “Closing” or
the “Closing Date”) shall take place at the offices of DVSO in Arizona at 9:00
a.m. on a date within five (5) business days after all of the conditions
described in paragraphs 12 and 13 hereof have been satisfied or, to the extent
permitted in paragraph 15 hereof, their satisfaction has been waived. DVSO and
SOE will use their best efforts to obtain the approvals specified in paragraph 6
hereof and any other of the consents, waivers or approvals necessary or
desirable to accomplish the transactions contemplated by this Agreement and the
Exchange Agreement. All documents required to be delivered by each of the
parties shall be duly delivered to the respective recipient thereof at or prior
to the Closing. In no event shall the Closing Date be later than June 30, 2007,
and if it is delayed beyond said date then either party shall have the right to
terminate this Agreement upon notice to that effect.

    

    (b)           At
the Closing, DVSO and SOE shall jointly direct that the Certificate of Exchange
be duly filed, and it shall in accordance with such direction be filed, if
required, in the office of the Secretary of State of the State of Delaware and
the Arizona Corporation Commission so that the Exchange shall be effective on
the Closing Date.

    

    3.           Investigation by the
Parties

    

    DVSO and
SOE each may, prior to the Closing Date, make or cause to be made such
investigation of the properties of the other and its subsidiaries and of its
financial and legal condition as the party making such investigation deems
necessary or advisable to familiarize itself with such properties and other
matters, provided, that such shall not interfere with normal operations. DVSO
and SOE each agrees to permit the other and its authorized agents or
representatives to have, after the date of execution hereof, full access to its
premises and to all of its books and records at reasonable hours, and its
subsidiaries and officers will furnish the party making such investigation with
such financial and operating data and other information with respect to the
business and properties of its and its subsidiaries as the party making such
investigation shall from time to time reasonably request. No investigation by
DVSO or SOE shall affect the representations and warranties of the other and
each such representation and warranty shall survive any such investigation. Each
party further agrees that in the event that the transactions contemplated by
this Agreement shall not be consummated it and its officers, employees,
accountants, attorneys, engineers and other representatives will not disclose or
make available to any other person or use for any purpose unrelated to the
consummation of this Agreement any information, whether written or oral, with
respect to the other party and its subsidiaries or their business which it
obtained pursuant to this Agreement. Such information shall remain the property
of the party providing it and shall not be reproduced or copied without the
consent of such party. In the event that the transaction contemplated by this
Agreement shall not be consummated, all such written information shall be
returned to the party providing it.

    

    4.           State
Securities Laws

     

    DVSO and
SOE will each take such steps as may be necessary on their respective parts to
comply with any state securities or so-called Blue Sky laws applicable to the
action to be taken by them in connection with the Exchange and the delivery by
DVSO to SOE shareholders of the DVSO Common Stock pursuant to this Agreement and
the Exchange Agreement.

    

     

    
      
        
        

      

      
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STOCK PURCHASE
AGREEMENT

     

    5.           Business
Pending the Closing

     

    (a) From
the date of this Agreement to and including the Closing Date, except as may be
first approved by SOE or as is otherwise permitted or contemplated by this
Agreement or in furtherance of the objectives of this Agreement: (i) DVSO (which
term shall, where applicable in this paragraph 5, also refer to the subsidiaries
of DVSO specified in paragraph 9 hereof) shall conduct its business only in the
usual and ordinary course without the creation of any additional indebtedness;
(ii) no change shall be made in the authorized capitalization of DVSO except as
contemplated by this Agreement; (iii) no shares of capital stock of DVSO shall
be authorized for issuance or issued and no agreement or commitment for the
issuance thereof shall be entered into in excess of the number of shares set
forth for DVSO in the Exchange Agreement; (iv) no rights or elections shall be
created or granted to purchase stock under any employee stock bonus, thrift or
purchase plan or otherwise, to the extent such rights shall result in the
commitment for the issuance of shares in excess of the number set forth for DVSO
in the Exchange Agreement; (v) no amendment shall be made to DVSO’s Articles of
Incorporation or Bylaws, except as contemplated by this Agreement; (vi) no
modifications shall be made in DVSO’s present employee benefit programs or in is
present policies in regard to the payment of salaries or compensation to its
personnel and no increase shall be made in the compensation of its personnel;
(vii) no contract or commitment shall be entered into by or on behalf of DVSO
and no sale or purchase of assets shall be made except in the ordinary course of
business; (viii) DVSO will use all reasonable and proper efforts to preserve its
business organization intact, to keep available the services of its present
employees and to maintain satisfactory relationships between DVSO and its
suppliers, customers, regulatory agencies, and others having business relations
with it; (ix) DVSO shall make no amendments or contributions to any profit
sharing plans; and (x) the Board of Directors of DVSO will not declare any
dividends on, or otherwise make any distributions in respect of, its outstanding
shares of capital stock;

    

    (b)
 From the date of this Agreement to and including the Closing Date, except
as may be first approved by DVSO or as is otherwise permitted or contemplated by
this Agreement: (i) SOE (which term shall, where applicable in this paragraph 5,
also refer to the subsidiaries of SOE specified in paragraph 10 hereof) shall
conduct its business only in the usual and ordinary course without the creation
of any additional indebtedness exceeding $10,000 for money borrowed maturing in
more than one year, except for the lease of capital equipment pursuant to
leasing company commitments outstanding prior to the date of this Agreement;
(ii) no change shall be made in the authorized capitalization of SOE except as
contemplated by this Agreement; (iii) no shares of capital stock of SOE shall be
authorized for issuance or issued and no agreement or commitment for the
issuance thereof shall be entered into in excess of the number of shares set
forth for SOE in the Exchange Agreement; (iv) no rights or elections shall be
created or granted to purchase stock under any employee stock bonus, thrift or
purchase plan or otherwise; (v) no amendment shall be made to SOE’s Articles of
Incorporation or Bylaws, except as contemplated by this Agreement; (vi) no
modifications shall be made in SOE’s present employee benefit programs or in is
present policies in regard to the payment of salaries or compensation to its
personnel and no increase shall be made in the compensation of its personnel and
no increase shall be made in the compensation of its personnel, provided that
nothing herein shall preclude (1) the continuation of SOE’s present practices of
periodically reviewing the salaries of its personnel and granting normal
increases in such salaries or compensation to such personnel, or (2) the hiring
of new personnel at a salary or compensation deemed reasonable in the ordinary
course of business; (vii) no contract or commitment shall be entered into by or
on behalf of SOE and no sale or purchase of assets shall be made except in the
ordinary course of business; (viii) SOE will use all reasonable and proper
efforts to preserve its business organization intact, to keep available the
services of its present employees and to maintain satisfactory relationships
between SOE and its suppliers, customers, regulatory agencies, and others having
business relations with it; (ix) SOE shall make no amendments or contributions
to any profit sharing plans; and (x) the Board of Directors of SOE will not
declare any dividends on, or otherwise make any distributions in respect of, its
outstanding shares of capital stock.

    

    
      
        
        

      

      
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STOCK PURCHASE
AGREEMENT

     

    5.           Business
Pending the Closing - continued

     

    
      (c) The
parties hereto agree that SOE is extending to DVSO an exclusive option to
purchase the shares of SOE. As such, SOE agrees not to solicit or entertain
offers to purchase its shares or assets from a third party prior to the Closing
or termination of this Agreement. As consideration for this exclusivity,
subsequent to the date of this Agreement but prior to Closing, SOE shall
continue its research and development program relating to the entertainment
Kiosk. SOE agrees that all intellectual property that may be protected by
patents, copyrights and trademarks will become the subject of patent
applications filed with the U.S. Patent and Trademark office, together with
appropriate assignments to SOE of all rights by any persons claiming or who may
have the right to claim status of an inventor or creator of the intellectual
property being the subject of each such application. All intellectual property
of SOE shall remain unencumbered and free of any liens or claims of whatsoever
nature prior to the Closing. Except as set forth in formal patents, copyrights
and trademarks, or applications for same, SOE makes no representations or
warranties with respect to its intellectual property. DVSO
understands and agrees that it will conduct its own independent investigations
with respect to the assets and liabilities of SOE, including but not limited to
items of intellectual property of SOE. Provided DVSO shall not have theretofore
issued written notice of termination of this Agreement, as provided herein, DVSO
will advance or reimburse all costs incurred by SOE in connection with the kiosk
development program including, but not limited to, consulting fees, professional
fees, prototype construction costs, engineering and design fees, and
administrative and overhead expenses. Such costs will be either paid directly by
DVOS or remitted to SOE upon written invoice therefore. In the event this
transaction shall fail to close, for any reason whatsoever, SOE shall be liable
to DVSO for all monies theretofore advanced to or for the benefit of the SOE
research and development program and shall execute and deliver to DVSO a
promissory note in such principal amount evidencing such indebtedness. Such
Promissory Note shall (i) provide for a maturity date two years from the date it
is executed, (ii) bear interest at the rate of three percent over the prime rate
as set by Bank of America from time to time, and (iii) permit repayment at any
time without penalty. The principal of the note, together with all accrued
interest, shall be due and payable at maturity. Upon execution and delivery of
the aforementioned promissory note, DVSO (i) shall have no rights, liens against
the intellectual property of SOE or any other claims against SOE except as
provided in the promissory note, and (ii) shall not be entitled to reimbursement
of any monies advanced, paid or remitted to or on behalf of SOE to any person or
entity pursuant to this Agreement except as provided in the promissory note. All
intellectual property developed or created by SOE prior to this Agreement or
during the term hereof, shall remain the property of SOE.

    

    

    6.           Efforts
to Obtain Approvals and Consents

    

    In
addition to DVSO and SOE obtaining the requisite shareholder approval as
described in paragraph 1 hereof, DVSO and SOE will use all reasonable and proper
efforts to obtain the following: (i) approval or consent of any other
governmental authorities having jurisdiction over the transactions contemplated
in this Agreement; and (ii) approval or consent of such other persons whose
consent is required to the transactions contemplated by this
Agreement.

    

    7.           Cooperation
Between Parties

    

    DVSO and
SOE shall fully cooperate with each other and with their respective counsel and
accountants in connection with any steps required to be taken as part of their
obligations under this Agreement, including the preparation of financial
statements and the supplying of information.

    

    8.           No
Tax Ruling

    

    DVSO and
SOE agree that they will not attempt to obtain ruling from the United States
Internal Revenue Service to the effect that for Federal Income Tax purposes no
gain or loss will be recognized to the holders of SOE Common Stock upon the
receipt of DVSO Common Stock in exchange for their SOE shares in accordance with
the provisions of this Agreement. In lieu of such a ruling from the Internal
Revenue Service, SOE may request an opinion of its counsel to the foregoing
effects, which opinion shall be a condition to both parties’ obligations to
consummate the Exchange.

    

    9.           Representations
of DVSO

     

    DVSO
represents, warrants and agrees that:

    

    (a)
 DVSO is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware and it and its subsidiaries are
duly qualified to do business and in good standing in every jurisdiction in
which the nature of its business or the character of its properties makes such
qualification necessary. DVSO’s subsidiaries and a list of jurisdictions in
which DVSO or its subsidiaries is so qualified is set forth in a memorandum to
be prepared by DVSO and furnished to SOE. DVSO owns 100% of the outstanding
capital stock of each of its subsidiaries.

    

    (b)
 As of December 31, 2005, the capitalization of DVSO and its subsidiaries
is as set forth in the financial statements previously furnished to SOE. The
outstanding capital stock of DVSO has been duly authorized and issued and is
fully paid and nonassessable. DVSO has no commitments to issue nor will it issue
any shares of its capital stock or any securities or obligations convertible
into or exchangeable for, or giving any person any right to acquire from DVSO,
any shares of its capital stock, except for those shares issued in conformity
with paragraph 5(a)(iii) above or otherwise described in prior filings with the
SEC.

    
      
        
        

      

      
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STOCK PURCHASE
AGREEMENT

    9.           Representations
of DVSO - continued

    

    (c)
 The shares of DVSO Common Stock which are to be issued and delivered to
the SOE shareholders pursuant to the terms of this Agreement and the Exchange
Agreement, when so issued and delivered, will be validly authorized and issued
and will be fully paid and nonassessable. No stockholder of DVSO, or other
person, will have any preemptive rights in respect to the DVSO Common
Stock.

    

    (d)
 DVSO has furnished SOE with copies of its 2005 Financial Statements
together with the Auditors report for its fiscal year ending June 30, 2005,
consisting of the consolidated balance sheet of DVSO and its subs idiaries as of
June 30, 2005, and related statements of consolidated income, stockholders’
equity and changes in financial position for the year then ended. DVSO has also
furnished SOE with copies of its unaudited financial statements for the six
months ending December 31, 2005, consisting of the consolidated balance sheet of
DVSO and its subsidiaries as of December 31, 2005, and related statements of
consolidated income, stockholders’ equity and changes in financial position for
the six months then ended. All of the above-described financial statements
present fairly the consolidated financial position of DVSO and its subsidiaries,
at the periods indicated, and the consolidated results of their operations and
changes in their financial position for the year and periods then ended in
conformity with generally accepted accounting principles applied on a consistent
basis. DVSO has no material liabilities or commitments other than as listed or
noted in the aforesaid financial statements, or as incurred in the ordinary
course of business since the date of such financial statements Since December
31, 2005, to the date of this Agreement, there has been no material adverse
change in the assets or liabilities or in the business or condition, financial
or otherwise, of DVSO or its subsidiaries, except in the ordinary course of
business or as contemplated by this Agreement, nor has DVSO or its subsidiaries,
except in the ordinary course of business or as contemplated by this Agreement,
incurred any indebtedness for money borrowed. All tax returns and reports of
DVSO and its subsidiaries required by law to be filed have been duly filed and
all taxes, assessments and other governmental charges now due (other than any
still payable without penalty) upon DVSO and its subsidiaries or upon any of
their properties or assets, have been paid. All amounts which have been
reflected as liabilities on the books of DVSO and its subsidiaries in respect of
taxes are considered adequate and DVSO does not know of any actual or proposed
additional assessments in respect of taxes, against either it or its
subsidiaries.

    

    (e)
 Subsequent to December 31, 2005, DVSO has not declared or paid any
dividends on its outstanding shares of common stock or declared or made any
distribution on, or directly or indirectly redeemed, purchased or otherwise
acquired any of its outstanding stock except as described in its prior filings
with the SEC, or authorized the creation or issuance of, or issued any
additional shares of stock, or agreed to take any such action, except as
expressly provided for in paragraph 5(a)(iii) above in this Agreement. Except as
permitted by paragraph 5(a)(iii), DVSO will not take any such action during the
period between the date hereof and the Closing Date except as provided
herein.

    

    (f)
 Neither DVSO nor any of its subsidiaries is engaged in or a party to, or
to the knowledge of DVSO threatened with, any material legal action or other
proceeding before any court or administrative agency, except as set forth and
described in a memorandum to be prepared by DVSO and furnished to
SOE.

    

    Neither DVSO nor any of its subsidiaries, to the knowledge of
DVSO, has been charged with, an is not under investigation with regard to, any
charge concerning any presently pending material violation of any provision of
Federal, State or other applicable law or administrative regulations in respect
of its business as set forth in said memorandum.

    

    (g) There
has not been, since December 31, 2005, and will not be prior to the Closing
Date, a purchase or sale or any other acquisition, transfer or distribution of
any assets or properties on the part of DVSO or its subsidiaries except in the
ordinary course of business.

    

    (h) Except
in each case as set forth in a memorandum to be prepared by DVSO and furnished
to SOE, as of the date of this Agreement neither DVSO nor any of its
subsidiaries is a holder of or a party to any: (1) written or oral contract for
the employment of any officer or any other person, (ii) bonus, pension, profit
sharing, retirement, stock purchase, stock option, insurance, or similar plan or
practice in effect with respect to its employees or other person, (iii) lease or
other commitment for the rental of office space, storage, or other facilities,
(iv) contract or lease agreement for the acquisition or lease of motor vehicles,
(v) insurance policy covering its properties, buildings, machinery, equipment,
furniture, fixtures or operations, or the life of any person; (vi) material
contract or commitment not made in the ordinary course of
business.

    
      
        
        

      

      
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STOCK PURCHASE
AGREEMENT

     

    9.           Representations
of DVSO - continued

    

    (i) The
execution and carrying out of this Agreement and compliance with the terms and
provisions hereof by DVSO will not conflict with or result in any material
breach of any of the terms, conditions, or provisions of, or constitute a
default under, or result in the creation of, any lien, charge or encumbrance
upon any of the property or assets of DVSO or any of its subsidiaries pursuant
to any corporate charter, bylaw, indenture, mortgage, agreement (other than that
which is created by virtue of this Agreement), or other instrument to which DVSO
or any of its subsidiaries is a party or by which they are bound or
affected.

    

    (j) This
Agreement and the memoranda and documents to be furnished hereunder on behalf of
DVSO do not and will not contain any untrue statement of a material fact nor
omit to state a material fact necessary to be stated in order to make the
statements contained herein and therein not misleading; and there is not fact
which materially adversely affects or in the future (so far as DVSO can now
foresee) will materially adversely affect the business operations, affairs or
condition of DVSO or its subsidiaries or any of the properties or assets which
has not been set forth in this Agreement and other documents and papers
furnished hereunder.

    

    10.           Representations
of SOE

    

    SOE
represents, warrants and agrees that:

    

    (a)
 SOE is a corporation duly organized, validly existing and in good standing
under the laws of the State of Arizona. SOE has the corporate power and any
necessary governmental authority to own or lease its properties now owned or
leased and to carry on its business as now being conducted. SOE is duly
qualified to do business and in good standing in every jurisdiction in which the
nature of its business or the character of its properties makes such
qualification necessary.

    

    (b)
 As of September 24, 2004, the capitalization of SOE and its subsidiaries
is as set forth in the financial statements previously furnished to DVSO. The
outstanding capital stock of SOE has been duly authorized and issued and is
fully paid and nonassessable. SOE has no commitments to issue nor will it issue
any shares of its capital stock or any securities or obligations convertible
into or exchangeable for, or giving any person any right to acquire from SOE,
any shares of its capital stock, except for those shares issued in conformity
with paragraph 5(b)(iii) above.

     

    (c)
 SOE has furnished DVSO with copies of its 2005 Financial Statements
together with the Auditors report for its fiscal year ending December 31, 2005,
consisting of the consolidated balance sheet of SOE and its subsidiaries as of
December 31, 2005, and related statements of consolidated income, stockholders’
equity and changes in financial position for the year then ended. All of the
above-described financial statements present fairly the consolidated financial
position of SOE and its subsidiaries, at the  periods indicated, and the
consolidated results of their operations and changes in their financial position
for the year and periods then ended in conformity with generally accepted
accounting principles applied on a consistent basis. SOE has no material
liabilities or commitments other than as listed or noted in the aforesaid
financial statements, or as incurred in the ordinary course of business since
the date of such financial statements, except under agreements described in the
memorandum described in paragraph 10(i) hereof. Since December 31, 2005, to the
date of this Agreement, there has been no material adverse change in the assets
or liabilities or in the business or condition, financial or otherwise, of SOE
or its consolidated subsidiaries, except in the ordinary course of business or
as contemplated by this Agreement. All tax returns and reports of SOE and its
subsidiaries required by law to be filed have been duly filed and all taxes,
assessments and other governmental charges now due (other than any still payable
without penalty) upon SOE and its subsidiaries or upon any of their properties
or assets, have been paid. All amounts which have been reflected as liabilities
on the books of SOE and its subsidiaries in respect of taxes are considered
adequate and SOE does not know of any actual or proposed additional assessments
in respect of taxes, against either it or its subsidiaries.

    

    (d)
 Subsequent to December 31, 2005, SOE has not declared or paid any
dividends on its outstanding shares of common stock or declared or made any
distribution on, or directly or indirectly redeemed, purchased or otherwise
acquired any of its outstanding stock or authorized the creation or issuance of,
or issued any additional shares of stock, or agreed to take any such action,
except as expressly provided for in paragraph 5(a)(iii) above in this Agreement.
SOE will not take any such action during the period between the date hereof and
the Closing Date except as provided herein.

    
      
        
        

      

      
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STOCK PURCHASE
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    10.           Representations
of SOE - continued

     

    (e)
 Neither SOE nor any of its subsidiaries is engaged in or a party to, or to
the knowledge of SOE threatened with, any material legal action or other
proceeding before any court or administrative agency.

    

    (f)
 There has not been, since December 31, 2005, and will not be prior to the
Closing Date, a purchase or sale or any other acquisition, transfer or
distribution of any assets or properties on the part of SOE or its subsidiaries
except in the ordinary course of business.

    

    (g)
 Except in each case as set forth in a memorandum to be prepared by SOE and
furnished to DVSO, as of the date of this Agreement neither SOE nor any of its
subsidiaries is a holder of or a party to any: (1) written or oral contract for
the employment of any officer or any other person, (ii) bonus, pension, profit
sharing, retirement, stock purchase, stock option, insurance, or similar plan or
practice in effect with respect to its employees or other person, (iii)
continuing contract for future purchase, sales, lease or distribution of
materials, services, supplies, products, or equipment involving annual payments
in excess of $10,000, (iv) lease or other commitment for the rental of office
space, storage, or other facilities, (v) contract or lease agreement for the
acquisition or lease of motor vehicles, (vi) contracts in force with employees
or others relating in whole or in part to disclosure, assignment or patenting of
any inventions, discoveries, improvements, shop rights, processes, formulae or
other know-how, presently owned or held, in whole or in part, by SOE or its
subsidiaries, (vii) insurance policy covering its properties, buildings,
machinery, equipment, furniture, fixtures or operations, or the life of any
person; (vi) material contract or commitment not made in the ordinary course of
business.

    

    (h)
 SOE has the corporate power to enter into this Agreement, the execution
and delivery and performance of this Agreement have been duly authorized by all
requisite corporate action, and this Agreement constitutes the valid and binding
obligation of SOE.

    

    (i)
 The execution and carrying out of this Agreement and compliance with the
terms and provisions hereof by SOE will not conflict with or result in any
material breach of any of the terms, conditions, or provisions of, or constitute
a default under, or result in the creation of, any lien, charge or encumbrance
upon any of the property or assets of SOE or any of its subsidiaries pursuant to
any corporate charter, bylaw, indenture, mortgage, agreement (other than that
which is created by virtue of this Agreement), or other instrument to which SOE
or any of its subsidiaries is a party or by which they are bound or
affected.

    

    (j) This Agreement and the
memoranda and documents to be furnished hereunder on behalf of SOE do not and
will not contain any untrue statement of a material fact nor omit to state a
material fact necessary to be stated in order to make the statements contained
herein and therein not misleading; and there is not fact which materially
adversely affects or in the future (so far as SOE can now foresee) will
materially adversely affect the business operations, affairs or condition of SOE
or its subsidiaries or any of the properties or assets which has not been set
forth in this Agreement and other documents and papers furnished
hereunder.

    

    11.           Survival
of Warranties

    

    The
representations and warranties made herein by DVSO and SOE shall survive the
Closing hereunder.

    

    12.           Conditions
to the Obligations of DVSO

    

    The
obligations of DVSO hereunder are subject to the satisfaction on or before
Closing Date of the following conditions:

    

    (a)
 This Agreement and the transactions contemplated hereby shall have been
approved by the requisite vote of the outstanding shares of SOE Common
Stock.

    

    (b)
 SOE shall have furnished DVSO with (1) a certified copy of resolutions
duly adopted by the holders of more than fifty percent (50%) of its issued and
outstanding shares of SOE Common Stock entitled to vote, evidencing approval of
this Agreement and the Exchange Agreement and the transactions contemplated
hereby and thereby; (2) one certified copy of resolutions duly adopted by the
Board of Directors of SOE approving the execution and delivery of this Agreement
and the Exchange Agreement and authorizing all necessary or proper corporate
action to enable SOE to comply with the terms hereof and thereof; and (3) a
certificate of SOE’s President or Secretary that each of SOE’s officers and
directors have resigned, as of the effective date subsequent to the actions
indicted in subparagraphs (1) and (2) of this paragraph 12(b).

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      
STOCK PURCHASE
AGREEMENT

     

    12.           Conditions
to the Obligations of DVSO - continued

     

    (c)
 The representation and warranties of SOE contained in this Agreement shall
be true in all material respects on and as of the Closing Date with the same
effect as though such representations and warranties had been made on and as of
such date, except for changes permitted by this Agreement or those incurred in
the ordinary course of business, and DVSO shall have received from SOE at the
Closing a certificate, dated the Closing Date, of the President or Vice
President of SOE to that effect.

    

    (d)
 Each and all of the respective agreements of SOE to be performed on or
before the Closing Date pursuant to the terms hereof shall in all material
respects have been duly performed and SOE shall have delivered to DVSO a
certificate date the Closing Date, of the President or Vice President of SOE to
that effect.

    

    (e)
 SOE shall have furnished DVSO with copies of its audited Financial
Statements together with the Auditor’s report for all fiscal years ended prior
to the Closing Date and for the current year from its beginning to the Closing
Date. Such financial statements shall consist of the balance sheet, the income
statement, statement of stockholder’s equity and changes in financial position
for the year or period then ended.

    

    13.           Conditions to the Obligations of
SOE

    

    The
obligations of SOE hereunder are subject to the satisfaction on or before
Closing Date of the following conditions:

    

    (a) This
Agreement and the transactions contemplated hereby shall have been approved by
the requisite vote of the outstanding shares of SOE Common Stock.

    

    (b) All
the terms and covenants of this Agreement to be complied with or performed by
DVSO shall have been fully complied with and performed in all material
respects.

    

    (c) The
representation and warranties of DVSO contained in this Agreement shall be true
in all material respects on and as of the Closing Date with the same effect as
though such representations and warranties had been made on and as of such date,
and DVSO shall have delivered to SOE at the Closing a certificate, dated the
Closing Date, of the President or Vice President of SOE to that
effect.

    

    (d) The
necessary approvals described in paragraph 6 hereof shall have been
granted.

    

    (e) On
the Closing Date, DVSO shall have furnished SOE with (1) a certified copy of
resolutions duly adopted by the holders of more than fifty percent (50%) of its
issued and outstanding shares of DVSO Common Stock entitled to vote, evidencing
approval of this Agreement and the Exchange Agreement and the transactions
contemplated hereby and thereby; and (2) a certified copy of DVSO approving the
execution and delivery of this Agreement and authorizing all necessary and
proper corporate action to enable DVSO to comply with the terms and conditions
of this Agreement.

    

    14.           Termination
and Modification of Rights

    

    (a) This
Agreement (except for the last three sentences of paragraph 3 hereof) may be
terminated at any time prior to the Closing Date by (1) mutual consent of the
parties hereto authorized by their respective Boards of Directors, or (2) upon
written notice to the other party, by either party, upon authorization of its
Board of Directors:

    

    (i) if
in its reasonably exercised judgment there shall have occurred a material
adverse change in the financial condition or business of the other party or the
other party shall have suffered a material loss or damage to any of its property
or assets, which change, loss or damage materially affects or impairs the
ability of the other party to conduct its business, or if any previously
undisclosed condition which materially adversely affects the earning power or
assets of either party comes to the attention of the other
party;

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      
STOCK PURCHASE
AGREEMENT

    14.           Termination
and Modification of Rights - continued

    

    (ii) if
the terms, covenants or conditions of this Agreement to be complied with or
performed by one of the other parties at or before the Closing Date shall not
have been materially complied with or performed at the time required for such
compliance or performance and such noncompliance or nonperformance shall not
have been waived by the party giving notice of termination;

    

    (iii) if any action or proceeding
shall have been instituted or threatened before a court or other governmental
body or by any public authority to restrain or prohibit the transaction
contemplated by this Agreement or if the consummation of such transaction would
subject either of such parties to liability for breach of any law or regulation;
or

    

    (b)
 As provided in paragraph 2(a) this Agreement may be terminated by either
party hereto upon notice to the other in the event the Closing shall not beheld
by June 30, 2007.

    

    (c)
 Any terms or conditions of this Agreement may be waived at any time by the
party hereto which is entitled to the benefit thereof, by action taken by the
Board of Directors of such party; and any such term or condition may be amended
at any time, by an agreement in writing executed by the chairman of the Board,
the President or any Vice President of each of the parties pursuant to
authorization by the respective Board of Directors; provided, however, that no
amendment of any principal term of the Exchange Agreement shall be effected
after approval of this Agreement by the shareholders of SOE, unless such
amendment is approved by such shareholders in accordance with the respective
state corporation law.

    

    15.           Expenses

    

    Except to
the extent otherwise provided in paragraph 5(c) of this Agreement, in the event
this Agreement is terminated without consummation at the Closing, DVSO and SOE
shall each pay all of its respective expenses incurred for the purpose of
carrying this Agreement into effect.

    

    16.           Finders

    

    Each of
the parties represents that no broker, agent, finder or similar person has been
retained or paid and that no brokerage fee or other commission has been agreed
to be paid for or on account of this Agreement.

    

    17.           Governing Law and
Venue

    

    This
Agreement shall be governed by and interpreted in accordance with the laws of
the State of Arizona, United States of America. The parties hereby expressly
agree that the proper venue for any claim or cause of action by the parties
shall be the district Court for Maricopa, Arizona, and each party upon execution
of this Agreement consents to the service of process from such
court.

    

    18.           Notices

    

    All
notices or other communications required or permitted hereunder shall be
sufficiently given if sent by certified mail, postage prepaid, addressed as
follows:

    

    

    If to
DVSO:                                       Dimensional
Visions Incorporated

    8777 N. Gainey Center Dr., Suite
191

    Scottsdale, AZ 85281

    

    With a copy to:

    

    Kenneth R. Pinckard, Esq.

    3104 E. Camelback Rd., Suite
245

    Phoenix, AZ 85016

    

    If to
SOE:                                           Studio
One Entertainment, Inc.

    Attn: Larry Ryckman

    13470 N. 85 th
Place

    Scottsdale, AZ 85260

    
 

    
      
        
        

      

      
        9

        
          

        

      

      
        STOCK
PURCHASE AGREEMENT

      

    

     

    19.           Binding Nature and
Assignment

    

    This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors, but it may not be assigned by any party without
the consent of the other.

    

    20.           Assignment

    

    Rights ad
obligations of a party to this Agreement may not be assigned or transferred
without the other party’s prior written consent.

    

    21.           Modification

    

    No
modification or amendment of this Agreement shall be valid unless it is in
writing and signed by both parties hereto.

    

    22.           Complete
Agreement

    

    This
Agreement constitutes the entire agreement between the parties and supersedes
all prior agreements and understandings between the parties.

    

    23.           Waiver

    

    The
waiver by either party of a breach of any term in this Agreement shall not
operate as, or be construed as, a waiver of any subsequent breach.

    

    24.           Headings

    

    The
headings in this Agreement are inserted for convenience only and shall not be
considered in interpreting the provisions hereof.

    

    25.           Counterparts

    

    This
Agreement may be executed in two or more counterparts by the parties hereto by
their respective officers thereunto duly authorized by a majority of their
directors as of the date first above written.

    

    

    IN
WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto by
their respective officers thereto duly authorized by a majority of their
directors as of the date first above written.

    

    
      
        	DIMENSIONAL VISIONS
      INCORPORATED
	 	 
	
                By:
    

              	/s/ Preston J.
      Shea 
	 	Preston J.
Shea 
	 	Title: President
	 	 

      

       

      
        	STUDIO ONE ENTERTAINMENT,
      INC.
	 	 
	
                By:
    

              	/s/ Lawrence H.
      Ryckman 
	 	Lawrence H.
      Ryckman  
	 	Title: Chairman and Chief
      Executive Officer
	 	 

      

       

       

    

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      
STOCK PURCHASE
AGREEMENT

    EXHIBIT “A”

    

    

    AGREEMENT OF
EXCHANGE

    OF

    DIMENSIONAL VISIONS
INCORPORATED

    AND

    STUDIO ONE ENTERTAINMENT,
INC.

    

    

    AGREEMENT
OF EXCHANGE made as of the _____ day of ________________, 20__, by and between
Dimensional Visions Incorporated, a Delaware corporation (herein, “DVSO”), and
Studio One Entertainment, Inc., an Arizona corporation (herein, “SOE”). DVSO and
SOE are sometimes hereinafter collectively referred to as the “Constituent
Corporations”.

    

    RECITALS:

    

    DVSO is a
Delaware corporation organized on May 12, 1988, and its authorized capital stock
consists of 100,000,000 shares of common stock, $.001 par value (the “DVSO
Common Stock”) of which no more than 4,000,000 shares of DVSO Common Stock will
be issued and outstanding as of the Closing Date.

    

    SOE is an
Arizona corporation organized on September 24, 2004 and its authorized capital
stock consists of 100,000,000 shares of common stock, no par value (the “SOE
Common Stock”) of which approximately 6,500,000 shares of SOE Common Stock will
be issued and outstanding as of the Closing Date and no shares of SOE Common
Stock are reserved for issuance upon exercise of any outstanding common stock
purchase warrants or options except as described in the Stock Purchase
Agreement.

    

    DVSO and
SOE have entered into an Stock Purchase Agreement dated March 29, 2006 (the
“Stock Purchase Agreement”) setting forth certain representations, warranties,
agreements and conditions in connection with the exchange provided for
herein.

    

    The
respective Board of Directors of DVSO and SOE have, by resolution, duly approved
the execution of and the transaction contemplated by the Stock Purchase
Agreement and this Agreement of Exchange and directed that they be submitted to
the shareholders of SOE for adoption and approval.

    

    NOW,
THEREFORE, in consideration of the premises and of the mutual covenants and
agreements herein contained, the parties hereto have agreed and do hereby agree,
subject to the terms and conditions hereinafter set forth, as
follows:

    

    I

    

    EXCHANGE

    

    1.1 In
accordance with the provisions of this Agreement and Section 1(a) of Stock
Purchase Agreement, each of the shares of SOE Common Stock outstanding as the
Effective Date of the Exchange shall be exchanged for one (1) share of DVSO
Common Stock to be issued upon the Effective Date of the Exchange. DVSO shall be
and is herein sometimes referred to as the “Acquiring Corporation”.

    

    1.2 Upon
the Effective Date of the Exchange (as defined in Article III hereof) SOE shall
become a wholly-owned subsidiary of DVSO, (i) shall continue to possess all of
its rights and property as constituted immediately prior to the Effective Date
of the Exchange and (ii) shall continue subject to all of its debts and
liabilities as the same shall have exited immediately prior to the Effective
Date of the Exchange. All rights of creditors and all liens upon the property of
each of the Constituent Corporations shall be preserved unimpaired.

    

    1.3 DVSO hereby agrees that at and after the times when the
Exchange shall become effective and as and when required by the provisions of
the Stock Purchase Agreement, DVSO will issue certificates representing that
number of shares of common stock, $.001 par value per share, or DVSO
(collectively, “Exchange Shares”) for which shares of DVSO Common Stock issued
and outstanding immediately prior to the Effective Date of the Exchange and by
virtue of the Exchange, be exchanged as hereinafter provided.

     

    1.4 The Exchange shall not become effective until the
following actions shall have been completed: (i) this Agreement of Exchange
shall have been adopted and approved by the shareholders of SOE in accordance
with the requirements of Arizona corporate law; and (ii) all of the other
conditions precedent to the consummation of the Exchange specified in the Stock
Purchase Agreement shall have been satisfied or duly waived by the party
entitled to satisfaction thereof.

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      
STOCK PURCHASE
AGREEMENT

     

    II

    

    EXCHANGE OF
SHARES

    

    The
manner and basis of exchanging shares of SOE Common Stock for the Exchange
Shares and the exchange of certificates therefore, shall be as
follows:

    

    2.1 Each
one (1) share of SOE Common Stock which shall be issued and outstanding
immediately prior to the Effective Date of the Exchange shall, by virtue of the
Exchange and without any action on the part of the holder thereof other than
that set forth in the Stock Purchase Agreement, be exchanged on or before the
fifteenth (15 th ) day after the
Board of Directors of DVSO shall have approved and authorized the consummation
of the transaction contemplated by the Acquisition Documents (the “Effective
Date of the Exchange”) into One (1) share of the Exchange Shares. If between the
date hereof and the Effective Date of the Exchange, DVSO or SOE shall either
effect any reclassification, recapitalization, subdivision, combination or
exchange or shares, in respect of their respective outstanding common stock, or
a stock divided thereon shall be declared with a record date within said period,
the per share amounts of the Exchange Shares to be issued and delivered as
provided in this Agreement shall be appropriately adjusted.

    

    2.2 After
the Effective Date of the Exchange certificates evidencing outstanding shares of
SOE Common Stock shall evidence the right of the holder thereof to receive
certificates for shares of the Exchange Shares at the applicable rate as
aforesaid. Each holder of SOE Common Stock, upon surrender of the certificate or
certificates, which prior thereto represented shares of SOE Common Stock, to
DVSO’s stock transfer agent, which shall act as the exchange agent (the
“Exchange Agent”) for such shareholder to effect the exchange of certificates on
their behalf, shall be entitled upon such surrender to receive in exchange
therefore a certificate or certificates representing the number of whole shares
of the Exchange Shares into which the shares of SOE Common Stock therefore
represented by the certificate or certificates so surrendered shall have been
exchanged as aforesaid. Until so surrendered, each outstanding certificate for
shares of SOE Common Stock shall be deemed for all corporate purposes, including
voting rights, subject to the future provisions of this Article II, to evidence
the ownership of the shares of the Exchange Shares into which such shares have
been so exchanged. No dividends or distributions will be paid to persons
entitled to receive certificates for shares of the Exchange Shares pursuant
hereto until such persons shall have surrendered their certificates which prior
to the Effective Date of the Exchange represented shares of SOE Common Stock;
but there shall be paid to the record holder of each such certificates, with
respect to the number of whole shares of the Exchange Shares issued in exchange
therefore (i) upon such surrender, the amount of any dividends or distributions
with a record date subsequent to the Effective Date of the Exchange and prior to
surrender which shall have become payable thereon since the Effective Date of
the Exchange, without interest, and (ii) after such surrender, the amount of any
dividends thereon with a record date subsequent to the Effective Date of the
Exchange and prior to surrender and the payment date of which shall be
subsequent to surrender; such amount to be paid on such payment
date.

    

    2.3 No
certificates representing a fraction of a share of the Exchange Shares will be
issued and no right to vote or receive any distribution or any other right of a
shareholder shall attach to any fractional interest in a share of the Exchange
Shares to which any holder of shares of SOE Common Stock would otherwise be
entitled hereunder. In lieu thereof, each holder of shares of SOE Common Stock
entitled to a fraction of a share of the Exchange Shares shall receive one whole
share of DVSO Common Stock if the fraction of a share is equal to or greater
than one-half share (.50); otherwise, the holder of the fraction of a share
shall receive cash on the basis of $.50 per share.

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      
STOCK PURCHASE
AGREEMENT

     

    EXCHANGE OF SHARES - continued

    
2.4 If
any certificate for shares of the Exchange Shares is to be issued in a name
other than that in which the certificate surrendered in exchange therefore is
registered, it shall be a condition of the issuance thereof that the certificate
so surrendered shall be properly endorsed and otherwise be in proper form for
transfer and that the person requesting such exchange pay to the Exchange Agent
any transfer or other taxes required by reason of the issuance of a certificate
for shares of the Exchange Shares in any name other than that of the registered
holder of the certificate surrendered, or establish to the satisfaction of the
Exchange Agent that such tax has been paid or is not payable.

     

    2.5 At
the Effective Date of the Exchange, all shares of SOE Common Stock which shall
then be held in its treasury, if any, shall cease to exist, and all certificates
representing such shares shall be canceled.

    

    

    III

    

    MISCELLANEOUS

    

    3.1 For
the convenience of the parties hereto and to facilitate the filing of this
Agreement of Exchange, any number of counterparts hereof may be executed; and
each such counterpart shall be deemed to be an original instrument.

    

    3.2 At
any time prior to the Effective Date of the Exchange the parties hereto may, by
written agreement, (a) extend the time for the performance of any of the
obligations or other acts of the parties hereto, (b) waive (in the manner
specified in Paragraph 14 of the Stock Purchase Agreement) any breach or
inaccuracy in the representations and warranties contained in this Agreement of
Exchange or in the Stock Purchase Agreement or in any document delivered
pursuant thereto, or (c) waive (in the manner specified in Paragraph 14 of the
Stock Purchase Agreement) compliance with any of the covenants, conditions or
agreements contained in this Agreement of Exchange or in the Stock Purchase
Agreement.

    

    3.3 The
corporation parties to this Agreement are also parties to the Stock Purchase
Agreement. The two agreements are intended to be construed together in order to
effectuate their purposes, and said agreements are intended as a plan or
reorganization within the meaning of Section 368 of the Internal Revenue Code of
1954, as amended.

    

    IN
WITNESS WHEREOF, each of the undersigned corporations has caused this Agreement
of Exchange to be signed in its corporate name by its duly authorized officers
and its corporate seal to be affixed hereto, all as of the date first above
written.

     

    

    
      	DIMENSIONAL VISIONS
      INCORPORATED
	 	 
	
              By:
    

            	/s/ Preston J.
      Shea 
	 	Preston J.
Shea 
	 	President
	 	 

    

     

    
      	STUDIO ONE ENTERTAINMENT,
      INC.
	 	 
	
              By:
    

            	/s/ Lawrence H.
      Ryckman 
	 	Lawrence H.
      Ryckman  
	 	Chairman and Chief Executive
      Officer
	 	 

    

     

     

     

     13exhibit_10-2.htm

    
      

    

    EXHIBIT 10.2

    

    AGREEMENT OF
EXCHANGE

    OF

    STUDIO ONE MEDIA,
INC.

    AND

    STUDIO ONE ENTERTAINMENT,
INC.

    

    

    AGREEMENT
OF EXCHANGE made as of the 17th day of April, 2007, by and between Studio One
Media, Ic., (fka Dimensional Visions Incorporated), a Delaware corporation
(herein, “SOMD”), and Studio One Entertainment, Inc., an Arizona corporation
(herein, “SOE”). SOMD and SOE are sometimes hereinafter collectively referred to
as the “Constituent Corporations”.

    

    RECITALS:

    

    SOMD is a
Delaware corporation organized on May 12, 1988, and its authorized capital stock
consists of 100,000,000 shares of common stock, $.001 par value (the “SOMD
Common Stock”) of which no more than 4,000,000 shares of SOMD Common Stock will
be issued and outstanding as of the Closing Date.

    

    SOE is an
Arizona corporation organized on September 24, 2004 and its authorized capital
stock consists of 100,000,000 shares of common stock, no par value (the “SOE
Common Stock”) of which 7,000,000 shares of SOE Common Stock will be issued and
outstanding as of the Closing Date and no shares of SOE Common Stock are
reserved for issuance upon exercise of any outstanding common stock purchase
warrants or options except as described in the Stock Purchase
Agreement.

    

    SOMD and
SOE have entered into an Stock Purchase Agreement dated March 29, 2006 (the
“Stock Purchase Agreement”) setting forth certain representations, warranties,
agreements and conditions in connection with the exchange provided for
herein.

    

    The
respective Board of Directors of SOMD and SOE have, by resolution, duly approved
the execution of and the transaction contemplated by the Stock Purchase
Agreement and this Agreement of Exchange and directed that they be submitted to
the shareholders of SOE for adoption and approval.

    

    A
majority of the shareholders of SOMD and a majority of the shareholders of SOE
have approved the transaction contemplated by the Stock Purchase Agreement and
this Agreement of Exchange.

    

    NOW,
THEREFORE, in consideration of the premises and of the mutual covenants and
agreements herein contained, the parties hereto have agreed and do hereby agree,
subject to the terms and conditions hereinafter set forth, as
follows:

    

    I

    

    EXCHANGE

    

    1.1 In
accordance with the provisions of this Agreement and Section 1(a) of Stock
Purchase Agreement, each of the shares of SOE Common Stock outstanding as the
Effective Date of the Exchange shall be exchanged for one (1) share of SOMD
Common Stock to be issued upon the Effective Date of the Exchange. SOMD shall be
and is herein sometimes referred to as the “Acquiring Corporation”.

    

    1.2 Upon
the Effective Date of the Exchange (as defined in Article III hereof) SOE shall
become a wholly-owned subsidiary of SOMD, (i) shall continue to possess all of
its rights and property as constituted immediately prior to the Effective Date
of the Exchange and (ii) shall continue subject to all of its debts and
liabilities as the same shall have exited immediately prior to the Effective
Date of the Exchange. All rights of creditors and all liens upon the property of
each of the Constituent Corporations shall be preserved
unimpaired.

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      
AGREEMENT OF
EXCHANGE

    EXCHANGE - continued

    

    1.3 SOMD
hereby agrees that at and after the times when the Exchange shall become
effective and as and when required by the provisions of the Stock Purchase
Agreement, SOMD will issue certificates representing that number of shares of
common stock, $.001 par value per share, or SOMD (collectively, “Exchange
Shares”) for which shares of SOMD Common Stock issued and outstanding
immediately prior to the Effective Date of the Exchange and by virtue of the
Exchange, be exchanged as hereinafter provided.

    

    1.4 The
Exchange shall not become effective until the following actions shall have been
completed: (i) this Agreement of Exchange shall have been adopted and approved
by the shareholders of SOE in accordance with the requirements of Arizona
corporate law; and (ii) all of the other conditions precedent to the
consummation of the Exchange specified in the Stock Purchase Agreement shall
have been satisfied or duly waived by the party entitled to satisfaction
thereof.

     

    

    II

    

    EXCHANGE OF
SHARES

    

    The
manner and basis of exchanging shares of SOE Common Stock for the Exchange
Shares and the exchange of certificates therefore, shall be as
follows:

    

    2.1 Each
one (1) share of SOE Common Stock which shall be issued and outstanding
immediately prior to the Effective Date of the Exchange shall, by virtue of the
Exchange and without any action on the part of the holder thereof other than
that set forth in the Stock Purchase Agreement, be exchanged on or before the
fifteenth (15 th ) day after the
Board of Directors of SOMD shall have approved and authorized the consummation
of the transaction contemplated by the Acquisition Documents (the “Effective
Date of the Exchange”) into One (1) share of the Exchange Shares. If between the
date hereof and the Effective Date of the Exchange, SOMD or SOE shall either
effect any reclassification, recapitalization, subdivision, combination or
exchange or shares, in respect of their respective outstanding common stock, or
a stock divided thereon shall be declared with a record date within said period,
the per share amounts of the Exchange Shares to be issued and delivered as
provided in this Agreement shall be appropriately adjusted.

    

    2.2 After
the Effective Date of the Exchange certificates evidencing outstanding shares of
SOE Common Stock shall evidence the right of the holder thereof to receive
certificates for shares of the Exchange Shares at the applicable rate as
aforesaid. Each holder of SOE Common Stock, upon surrender of the certificate or
certificates, which prior thereto represented shares of SOE Common Stock, to
SOMD’s stock transfer agent, which shall act as the exchange agent (the
“Exchange Agent”) for such shareholder to effect the exchange of certificates on
their behalf, shall be entitled upon such surrender to receive in exchange
therefore a certificate or certificates representing the number of whole shares
of the Exchange Shares into which the shares of SOE Common Stock therefore
represented by the certificate or certificates so surrendered shall have been
exchanged as aforesaid. Until so surrendered, each outstanding certificate for
shares of SOE Common Stock shall be deemed for all corporate purposes, including
voting rights, subject to the future provisions of this Article II, to evidence
the ownership of the shares of the Exchange Shares into which such shares have
been so exchanged. No dividends or distributions will be paid to persons
entitled to receive certificates for shares of the Exchange Shares pursuant
hereto until such persons shall have surrendered their certificates which prior
to the Effective Date of the Exchange represented shares of SOE Common Stock;
but there shall be paid to the record holder of each such certificates, with
respect to the number of whole shares of the Exchange Shares issued in exchange
therefore (i) upon such surrender, the amount of any dividends or distributions
with a record date subsequent to the Effective Date of the Exchange and prior to
surrender which shall have become payable thereon since the Effective Date of
the Exchange, without interest, and (ii) after such surrender, the amount of any
dividends thereon with a record date subsequent to the Effective Date of the
Exchange and prior to surrender and the payment date of which shall be
subsequent to surrender; such amount to be paid on such payment
date.

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      
AGREEMENT OF
EXCHANGE

     

    EXCHANGE OF SHARES - continued

    

    2.3 No
certificates representing a fraction of a share of the Exchange Shares will be
issued and no right to vote or receive any distribution or any other right of a
shareholder shall attach to any fractional interest in a share of the Exchange
Shares to which any holder of shares of SOE Common Stock would otherwise be
entitled hereunder. In lieu thereof, each holder of shares of SOE Common Stock
entitled to a fraction of a share of the Exchange Shares shall receive one whole
share of SOMD Common Stock if the fraction of a share is equal to or greater
than one-half share (.50); otherwise, the holder of the fraction of a share
shall receive cash on the basis of $.50 per share.

    

    2.4 If
any certificate for shares of the Exchange Shares is to be issued in a name
other than that in which the certificate surrendered in exchange therefore is
registered, it shall be a condition of the issuance thereof that the certificate
so surrendered shall be properly endorsed and otherwise be in proper form for
transfer and that the person requesting such exchange pay to the Exchange Agent
any transfer or other taxes required by reason of the issuance of a certificate
for shares of the Exchange Shares in any name other than that of the registered
holder of the certificate surrendered, or establish to the satisfaction of the
Exchange Agent that such tax has been paid or is not payable.

    

    2.5 At
the Effective Date of the Exchange, all shares of SOE Common Stock which shall
then be held in its treasury, if any, shall cease to exist, and all certificates
representing such shares shall be canceled.

    

    III

    

    CONDITION
SUBSEQUENT

    

    SOE
shall, within thirty days of the date hereof, furnish SOMD with copies of its
audited Financial Statements together with the Auditor’s report for all fiscal
years ended December 31, 2004, 2005, and 2006 and for the current year through
and at the Closing Date. Such financial statements shall consist of the balance
sheet, the income statement, statement of stockholder’s equity and changes in
financial position for the year or period then ended.

    

    

    IV

    

    MISCELLANEOUS

    

    3.1 For
the convenience of the parties hereto and to facilitate the filing of this
Agreement of Exchange, any number of counterparts hereof may be executed; and
each such counterpart shall be deemed to be an original instrument.

    

    3.2 At
any time prior to the Effective Date of the Exchange the parties hereto may, by
written agreement, (a) extend the time for the performance of any of the
obligations or other acts of the parties hereto, (b) waive (in the manner
specified in Paragraph 14 of the Stock Purchase Agreement) any breach or
inaccuracy in the representations and warranties contained in this Agreement of
Exchange or in the Stock Purchase Agreement or in any document delivered
pursuant thereto, or (c) waive (in the manner specified in Paragraph 14 of the
Stock Purchase Agreement) compliance with any of the covenants, conditions or
agreements contained in this Agreement of Exchange or in the Stock Purchase
Agreement.

    

    3.3 The
corporation parties to this Agreement are also parties to the Stock Purchase
Agreement. The two agreements are intended to be construed together in order to
effectuate their purposes, and said agreements are intended as a plan or
reorganization within the meaning of Section 368 of the Internal Revenue Code of
1954, as amended.

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      
AGREEMENT OF
EXCHANGE

    IN
WITNESS WHEREOF, each of the undersigned corporations has caused this Agreement
of Exchange to be signed in its corporate name by its duly authorized officers
and its corporate seal to be affixed hereto, all as of the date first above
written.

    

                                                    

     

    
      	 STUDIO
      ONE MEDIA, INC.
	 
	 By: /s/ Preston J.
      Shea   
	 /s/
      Preston J. Shea   
	 President
	 
	 
	 STUDIO ONE ENTERTAINMENT,
      INC.  
	 
	 By: /s/ Lawrence G.
      Ryckman
	 Lawrence
      G. Ryckman
	 Chairman
      and Chief Executive Officer

    

     

     

     

     

     

     

     

     

     

     

    4

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