Document:

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                                                                    Exhibit 10.5

                       FIRST VIRTUAL COMMUNICATIONS, INC.

                            (FORMERLY FVC.COM, INC.)

                           1999 EQUITY INCENTIVE PLAN

           ADOPTED BY THE BOARD OF DIRECTORS EFFECTIVE APRIL 21, 1999

      AMENDED BY THE BOARD OF DIRECTORS ON JANUARY 17, 2000, MAY 31, 2000,
            JANUARY 10, 2001, JULY 31, 2002, AND NOVEMBER 13, 2002

1. PURPOSES.

   (a) The purpose of the Plan is to provide a means by which selected Employees
and Consultants may be given an opportunity to benefit from increases in value
of the common stock of the Company through the granting of (i) Nonstatutory
Stock Options, (ii) stock bonuses, and (iii) rights to purchase restricted
stock.

   (b) The Company, by means of the Plan, seeks to retain the services of
persons who are now Employees or Consultants, to secure and retain the services
of new Employees and Consultants and to provide incentives for such persons to
exert maximum efforts for the success of the Company and its Affiliates.

   (c) The Company intends that the Stock Awards issued under the Plan shall, in
the discretion of the Board, be either (i) Nonstatutory Stock Options granted
pursuant to Section 6 hereof or (ii) stock bonuses or rights to purchase
restricted stock granted pursuant to Section 7 hereof. All Options shall be in
such form as issued pursuant to Section 6.

2. DEFINITIONS.

   (a) "AFFILIATE" means any parent corporation or subsidiary corporation,
whether now or hereafter existing, as those terms are defined in Sections 424(e)
and (f) respectively, of the Code, or such other parent corporation or
subsidiary corporation designated by the Board.

   (b) "BOARD" means the Board of Directors of the Company.

   (c) "CODE" means the Internal Revenue Code of 1986, as amended.

   (d) "COMMITTEE" means a committee appointed by the Board in accordance with
subsection 3(c) of the Plan.

   (e) "COMMON STOCK" means the common stock of the Company.

   (f) "COMPANY" means First Virtual Communications, Inc., formerly FVC.COM,
Inc., a Delaware corporation.

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   (g) "CONSULTANT" means any person, including an advisor, engaged by the
Company or an Affiliate to render consulting services and who is compensated for
such services, provided that the term "Consultant" shall not include a Director.

   (h) "CONTINUOUS STATUS" means the service relationship, whether as an
Employee, Director or a Consultant, is not interrupted or terminated. The Board
or the Committee, in that party's sole discretion, may determine whether
Continuous Status as an Employee, Director or Consultant shall be considered
interrupted in the case of: (i) any leave of absence approved by the Board,
including sick leave, military leave, or any other personal leave, or (ii)
transfers between locations of the Company or between the Company, Affiliates or
their successors.

   (i) "DIRECTOR" means a member of the Board.

   (j) "DISABILITY" means the inability of a person, in the opinion of a
qualified physician acceptable to the Company, to perform the major duties of
that person's position with the Company or an Affiliate of the Company because
of the sickness or injury of the person.

   (k) "EMPLOYEE" means any person employed by the Company or by any Affiliate,
excluding Officers and Directors of the Company (and of any Affiliate which
controls the Company).

   (l) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.

   (m) "FAIR MARKET VALUE" means, as of any date, the value of the Common Stock
determined as follows and in each case in a manner consistent with Section
260.140.50 of Title 10 of the California Code of Regulations:

        (i) If the Common Stock is listed on any established stock exchange, or
traded on the Nasdaq National Market or The Nasdaq SmallCap Market, the Fair
Market Value of a share of Common Stock shall be the closing sales price for
such stock (or the closing bid, if no sales were reported) as quoted on such
exchange or market (or the exchange or market with the greatest volume of
trading in Common Stock) on the last market trading day prior to determination,
as reported in The Wall Street Journal or such other source as the Board deems
reliable;

        (ii) In the absence of an established market for the Common Stock, the
Fair Market Value shall be determined in good faith by the Board and to the
extent that the Company is subject to Section 260.140.50 of Title 10 of the
California Code of Regulations, in a manner consistent with Section 260.140.50
of Title 10 of the California Code of Regulations.

   (n) "NONSTATUTORY STOCK OPTION" means an Option not intended to qualify as an
incentive stock option pursuant to Section 422 of the Code and the regulations
promulgated thereunder.

   (o) "OFFICER" means a person who is an officer of the Company, including any
corporate officer with the title of vice president and above and any other
Employee of the Company whom the Board or the Committee classifies as "Officer."

                                       2.

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   (p) "OPTION" means a Nonstatutory Stock Option granted pursuant to the Plan.

   (q) "OPTION AGREEMENT" means a written agreement between the Company and an
Optionee evidencing the terms and conditions of an individual Option grant. Each
Option Agreement shall be subject to the terms and conditions of the Plan.

   (r) "OPTIONEE" means a person to whom an Option is granted pursuant to the
Plan.

   (s) "PARTICIPANT" means a person to whom a Stock Award is granted pursuant to
the Plan or, if applicable, such other person who holds an outstanding Stock
Award.

   (t) "PLAN" means this First Virtual Communications, Inc. 1999 Equity
Incentive Plan.

   (u) "SHARE" means a share of Common Stock of the Company.

   (v) "STOCK AWARD" means any right granted under the Plan, including any
Option, any stock bonus and any right to purchase restricted stock.

   (w) "SECURITIES ACT" means the Securities Act of 1933, as amended.

   (x) "STOCK AWARD AGREEMENT" means a written agreement between the Company and
a holder of a Stock Award evidencing the terms and conditions of an individual
Stock Award grant. Each Stock Award Agreement shall be subject to the terms and
conditions of the Plan.

   (y) "TEN PERCENT STOCKHOLDER" means a person who owns (or is deemed to own
pursuant to Section 424(d) of the Code) stock possessing more than ten percent
(10%) of the total combined voting power of all classes of stock of the Company
or any of its Affiliates.

3. ADMINISTRATION.

   (a) The Plan shall be administered by the Board unless and until the Board
delegates administration to a Committee, as provided in subsection 3(c).

   (b) The Board shall have the power, subject to, and within the limitations
of, the express provisions of the Plan:

        (i) To determine from time to time which of the persons eligible under
the Plan shall be granted Stock Awards; when and how each Stock Award shall be
granted; whether a Stock Award will be an Option, a stock bonus, a right to
purchase restricted stock or a combination of the foregoing; the provisions of
each Stock Award granted (which need not be identical), including the time or
times when a person shall be permitted to receive Shares pursuant to a Stock
Award and the number of Shares with respect to which a Stock Award shall be
granted to each such person.

        (ii) To construe and interpret the Plan and Stock Awards granted under
it, and to establish, amend and revoke rules and regulations for its
administration. The Board, in the exercise of this power, may correct any
defect, omission or inconsistency in the Plan or in any

                                       3.

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Stock Award Agreement, in a manner and to the extent it shall deem necessary or
expedient to make the Plan fully effective.

        (iii) To amend the Plan or a Stock Award as provided in Section 13.

        (iv) Generally, to exercise such powers and to perform such acts as the
Board deems necessary or expedient to promote the best interests of the Company
which are not in conflict with the provisions of the Plan.

   (c) The Board may delegate administration of the Plan to a committee or
committees ("Committee") of one or more members of the Board. If administration
is delegated to a Committee, the Committee shall have, in connection with the
administration of the Plan, the powers theretofore possessed by the Board (and
references in this Plan to the Board shall thereafter be to the Committee),
subject, however, to such resolutions, not inconsistent with the provisions of
the Plan, as may be adopted from time to time by the Board. The Board may
abolish the Committee at any time and revest in the Board the administration of
the Plan. Notwithstanding anything to the contrary contained herein, the Board
may delegate administration of the Plan to any person or persons and the term
"Committee" shall apply to any person or persons to whom such authority has been
delegated.

4. SHARES SUBJECT TO THE PLAN.

   (a) Subject to the provisions of Section 12 relating to adjustments upon
changes in the stock and Section 4(c) below, the Shares that may be issued
pursuant to Stock Awards shall not exceed in the aggregate Six Million
(6,000,000) Shares. If any Stock Award shall for any reason expire or otherwise
terminate, in whole or in part, without having been exercised in full (or vested
in the case of restricted stock), the Shares not acquired under such Stock Award
shall revert to and again become available for issuance under the Plan.

   (b) The Shares subject to the Plan may be unissued Shares or reacquired
Shares bought on the market or otherwise.

   (c) Notwithstanding Section 4(a), if at the time of each grant of a Stock
Award under the Plan, the Company is subject to Section 260.140.45 of Title 10
of the California Code of Regulations ("Section 260.140.45"), the total number
of securities issuable upon exercise of all outstanding options of the Company
and the total number of shares provided for under this Plan or any other equity
incentive, stock bonus or similar plan or agreement of the Company or outside
any such plan shall not exceed 30% of the then outstanding capital stock of the
Company (as measured as set forth in Section 260.140.45), unless stockholder
approval to exceed 30% has been obtained in compliance with Section 260.140.45,
in which case the limit shall be such higher percentage as approved by the
stockholders.

5. ELIGIBILITY.

   (a) Stock Awards may be granted only to Employees or Consultants as defined
in Section 2 hereof. An Employee or Consultant who has been granted a Stock
Award, if he or she remains eligible, may be granted an additional Stock Award
or Stock Awards. Notwithstanding the foregoing, no Employee who is an Officer of
the Company (and of any Affiliate which

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controls the Company) or who is a Director shall be entitled to receive the
grant of a Stock Award under the Plan.

   (b) Stock Awards may not be granted to Consultants who are not natural
persons unless the Company determines both (i) that such grant (A) shall be
registered in a manner other than on a Form S-8 Registration Statement under the
Securities Act (e.g., on a Form S-3 Registration Statement) or (B) does not
require registration under the Securities Act in order to comply with the
requirements of the Securities Act, if applicable, and (ii) that such grant
complies with the securities laws of all other relevant jurisdictions.

   (c) The Plan shall not confer upon any Stock Award holder any right with
respect to continuation of employment or consultancy by the Company, nor shall
it interfere in any way with the holder's right or the Company's right to
terminate the Stock Award holder's employment at any time, for any reason or no
reason, with or without cause, or to terminate the Stock Award holder's
consultancy pursuant to the terms of the Consultant's agreement with the
Company.

   (d) Ten Percent Stockholders.

       (i) So long as the Company is subject to Section 260.140.41 of Title 10
of the California Code of Regulations, a Ten Percent Stockholder shall not be
granted a Nonstatutory Stock Option unless the exercise price of such Option is
at least (A) one hundred ten percent (110%) of the Fair Market Value of the
Common Stock on the date of grant or (B) such lower percentage of the Fair
Market Value of the Common Stock on the date of grant as is permitted by Section
260.140.41 of Title 10 of the California Code of Regulations at the time of the
grant of the Option.

       (ii) So long as the Company is subject to Section 260.140.41 of Title 10
of the California Code of Regulations, a Ten Percent Stockholder shall not be
granted a restricted stock award unless the purchase price of the restricted
stock is at least (A) one hundred percent (100%) of the Fair Market Value of the
Common Stock on the date of grant or (B) such lower percentage of the Fair
Market Value of the Common Stock on the date of grant as is permitted by Section
260.140.41 of Title 10 of the California Code of Regulations at the time of the
grant of the restricted stock award.

6. OPTION PROVISIONS.

   Each Option shall be in such form and shall contain such terms and conditions
as the Board shall deem appropriate. The provisions of separate Options need not
be identical, but each Option shall include (through incorporation of provisions
hereof by reference in the Option or otherwise) the substance of each of the
following provisions:

   (a) TERM. No Option shall be exercisable after the expiration of ten (10)
years from the date it was granted or such longer or shorter term as may be
provided in the Option Agreement.

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   (b) PRICE. Subject to the provisions of subsection 5(d) regarding Ten Percent
Stockholders, the exercise price of each Option shall be not less than 85% of
the Fair Market Value of the Common Stock subject to the Option on the date of
grant.

   (c) CONSIDERATION. The consideration to be paid for the Shares to be issued
upon exercise of an Option, including the method of payment, shall be determined
by the Board and may consist entirely of (i) cash or check, (ii) promissory note
(except that payment of the Share's "par value", as defined in the Delaware
General Corporation Law, shall not be made by deferred payment), (iii) other
Shares having a fair market value on the date of surrender equal to the
aggregate exercise price of the Shares as to which the Option shall be
exercised, including by delivering to the Company an attestation of ownership of
owned and unencumbered Shares in a form approved by the Company, (iv) payment
pursuant to a program developed under Regulation T as promulgated by the Federal
Reserve Board which, prior to the issuance of the Shares, results in either the
receipt of cash (or check) by the Company or the receipt of irrevocable
instructions to pay the aggregate exercise price to the Company from the sales
proceeds, (v) any combination of such methods of payment, or (vi) such other
consideration and method of payment for the issuance of Shares to the extent
permitted under applicable law. In making its determination as to the type of
consideration to accept, the Board shall consider if acceptance of such
consideration may be reasonably expected to benefit the Company. In the case of
any deferred payment arrangement, interest shall be charged at the minimum rate
of interest necessary to avoid the treatment as interest, under any applicable
provisions of the Code, of any amounts other than amounts stated to be interest
under the deferred payment arrangement.

   (d) TRANSFERABILITY. An Option shall not be transferable except by will or by
the laws of descent and distribution and, to the extent provided in the Option
Agreement, to such further extent as permitted by Section 260.140.41(d) of Title
10 of the California Code of Regulations at the time of the grant of the Option,
and, except in the case of a permitted transfer, shall be exercisable during the
lifetime of the person to whom the Option is granted only by such person. If the
Option does not provide for transferability, then the Option shall not be
transferable except by will or by the laws of descent and distribution and shall
be exercisable during the lifetime of the person to whom the Option is granted
only by such person. Notwithstanding the foregoing, the person to whom the
Option is granted may, by delivering written notice to the Company, in a form
satisfactory to the Company, designate a third party who, in the event of the
death of the Optionee, shall thereafter be entitled to exercise the Option.

   (e) VESTING. The total number of Shares subject to an Option may, but need
not, vest and therefore become exercisable in periodic installments (that may,
but need not, be equal). The Option may be subject to such other terms and
conditions on the time or times when it may be exercised (which may be based on
performance or other criteria) as the Board may deem appropriate. The vesting
provisions of individual Options may vary. The provisions of this subsection
6(e) are subject to any Option provisions governing the minimum number of Shares
as to which an Option may be exercised.

   (f) MINIMUM VESTING. Notwithstanding the foregoing Section 6(e), to the
extent that the Company is subject to the following restrictions on vesting
under Section 260.140.41(f) of Title 10 of the California Code of Regulations at
the time of the grant of the Option, then options granted to an Employee who is
not an Officer, Director or Consultant on the date of grant

                                       6.

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shall provide for vesting of the total number of Shares at a rate of at least
twenty percent (20%) per year over five (5) years from the date the Option was
granted, subject to reasonable conditions such as continued employment.

   (g) TERMINATION OF CONTINUOUS STATUS AS AN EMPLOYEE, DIRECTOR OR CONSULTANT.
In the event an Optionee's Continuous Status as an Employee, Director or
Consultant terminates (other than upon the Optionee's death or disability), the
Optionee may exercise his or her Option within three (3) months (or such longer
or shorter period specified in the Option Agreement, which period, for so long
as the Company is subject to Section 260.140.41 of Title 10 of the California
Code of Regulations, shall not be less than thirty (30) days unless such
termination is for cause), (the "Post-Termination Exercise Period") and only to
the extent that the Optionee was entitled to exercise the Option on the date the
Optionee's Continuous Status as an Employee, Director or Consultant terminates.
The Board may at any time extend the Post-Termination Exercise Period and
provide for continued vesting during such extended period. If, as of the date of
termination, the Optionee is not entitled to exercise his or her entire Option,
the Shares covered by the unexercisable portion of the Option shall revert to
the Plan. If, after termination, the Optionee does not exercise his or her
Option within the time specified in the Option Agreement or as otherwise
determined above, the Option shall terminate, and the Shares covered by such
Option shall revert to the Plan. Notwithstanding the foregoing, the Board shall
have the power to permit an Option to vest, in whole or in part, during the
Post-Termination Exercise Period.

   (h) DISABILITY OF OPTIONEE. In the event an Optionee's Continuous Status as
an Employee, Director or Consultant terminates as a result of the Optionee's
Disability, the Optionee may exercise his or her Option (to the extent that the
Optionee was entitled to exercise it as of the date of termination), but only
within such period of time ending on the earlier of (i) the date twelve (12)
months following such termination (or such longer or shorter period specified in
the Option Agreement which period for so long as the Company is subject to
Section 260.140.41 of Title 10 of the California Code of Regulations, shall not
be less than six (6) months unless such termination is for cause), or (ii) the
expiration of the term of the Option as set forth in the Option Agreement. If,
at the date of termination, the Optionee is not entitled to exercise his or her
entire Option, the Shares covered by the unexercisable portion of the Option
shall revert to and again become available for issuance under the Plan. If,
after termination, the Optionee does not exercise his or her Option within the
time specified herein, the Option shall terminate, and the Shares covered by
such Option shall revert to and again become available for issuance under the
Plan.

   (i) DEATH OF OPTIONEE. In the event of the death of an Optionee during, or
within a period specified in the Option Agreement after the termination of, the
Optionee's Continuous Status as an Employee, Director or Consultant, the Option
may be exercised (to the extent the Optionee was entitled to exercise the Option
as of the date of death) by the Optionee's estate, by a person who acquired the
right to exercise the Option by bequest or inheritance, but only within the
period ending on the earlier of (i) the date eighteen (18) months following the
date of death (or such longer or shorter period specified in the Option
Agreement which period, for so long as the Company is subject to Section
260.140.41 of Title 10 of the California Code of Regulations, shall not be less
than six (6) months unless such termination is for cause), or (ii) the
expiration of the term of such Option as set forth in the Option Agreement. If,
at the time of death, the

                                       7.

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Optionee was not entitled to exercise his or her entire Option, the Shares
covered by the unexercisable portion of the Option shall revert to and again
become available for issuance under the Plan. If, after death, the Option is not
exercised within the time specified herein, the Option shall terminate, and the
Shares covered by such Option shall revert to and again become available for
issuance under the Plan.

   (j) EARLY EXERCISE. The Option may, but need not, include a provision whereby
the Optionee may elect at any time before the Optionee's Continuous Status
terminates to exercise the Option as to any part or all of the Shares subject to
the Option prior to the full vesting of the Option. Subject to the "Repurchase
Limitation" in Section 11(f), any unvested Shares so purchased may be subject to
a repurchase option in favor of the Company, with the repurchase price to be
equal to the lower of Fair Market Value on the date of repurchase or the
original purchase price of the stock, or to any other restriction the Board
determines to be appropriate. Provided that the "Repurchase Limitation" in
Section 11(f) is not violated, the Company will not exercise its repurchase
option until at least six (6) months (or such longer or shorter period of time
required to avoid a charge to earnings for financial accounting purposes) have
elapsed following exercise of the Option unless the Board otherwise specifically
provides in the Option.

   (k) RIGHT OF REPURCHASE. Subject to the "Repurchase Limitation" in Section
11(f), the Option may, but need not, include a provision whereby the Company may
elect to repurchase all or any part of the vested Shares acquired by the
Optionee pursuant to the exercise of the Option. Provided that the "Repurchase
Limitation" in Section 11(f) is not violated, the Company will not exercise its
repurchase option until at least six (6) months (or such longer or shorter
period of time required to avoid a charge to earnings for financial accounting
purposes) have elapsed following exercise of the Option unless otherwise
specifically provided in the Option.

7. TERMS OF STOCK BONUSES AND PURCHASES OF RESTRICTED STOCK.

   Each stock bonus or restricted stock purchase agreement shall be in such form
and shall contain such terms and conditions as the Board shall deem appropriate.
The terms and conditions of stock bonus or restricted stock purchase agreements
may change from time to time, and the terms and conditions of separate
agreements need not be identical, but each stock bonus or restricted stock
purchase agreement shall include (through incorporation of provisions hereof by
reference in the agreement or otherwise) the substance of each of the following
provisions as appropriate:

   (a) PURCHASE PRICE. Subject to the provisions of Section 5(d) regarding Ten
Percent Stockholders, the purchase price under each stock bonus or restricted
stock purchase agreement shall be such amount as the Board shall determine and
designate in such agreement. Notwithstanding the foregoing, the Board may
determine that eligible participants in the Plan may be awarded stock pursuant
to a stock bonus or restricted stock purchase agreement in consideration for
past services actually rendered to the Company or for its benefit.

   (b) TRANSFERABILITY. Rights to acquire Shares under a stock bonus or
restricted stock purchase agreement shall not be transferable except by will or
by the laws of descent and distribution and shall be exercisable during the
lifetime of the Participant only by the Participant.

                                       8.

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   (c) CONSIDERATION. The purchase price of Shares acquired pursuant to a stock
bonus or restricted stock purchase agreement shall be paid either: (i) in cash
at the time of purchase, (ii) at the discretion of the Board, according to a
deferred payment or other arrangement with the person to whom the Shares are
sold, except that payment of the common stock's "par value" (as defined in the
Delaware General Corporation Law) shall not be made by deferred payment, or
(iii) in any other form of legal consideration that may be acceptable to the
Board in its discretion. Notwithstanding the foregoing, the Board to which
administration of the Plan has been delegated may award stock pursuant to a
stock bonus or restricted stock purchase agreement in consideration for past
services actually rendered to the Company or for its benefit.

   (d) VESTING. Subject to the "Repurchase Limitation" in Section 11(f) shares
sold or awarded under the Plan may, but need not, be subject to a repurchase
option or reacquisition option in favor of the Company in accordance with a
vesting schedule to be determined by the Board.

   (e) TERMINATION OF CONTINUOUS STATUS AS AN EMPLOYEE, DIRECTOR OR CONSULTANT.
Subject to the "Repurchase Limitation" in Section 11(f), in the event a
Participant's Continuous Status as an Employee, Director or Consultant
terminates, the Company may repurchase or otherwise reacquire any or all of the
Shares held by that person which have not vested as of the date of termination
under the terms of the stock bonus or restricted stock purchase agreement
between the Company and such person. Provided that the "Repurchase Limitation"
in Section 11(f) is not violated, the Company will not exercise its repurchase
option until at least six (6) months (or such longer or shorter period of time
required to avoid a charge to earnings for financial accounting purposes) have
elapsed following receipt of the stock bonus or restricted stock unless
otherwise specifically provided in the stock bonus or restricted stock purchase
agreement.

8. CANCELLATION AND RE-GRANT OF OPTIONS.

   The Board or the Committee shall have the authority to effect, at any time
and from time to time (i) the repricing of any outstanding Options under the
Plan and/or (ii) with the consent of the affected holders of Options, the
cancellation of any outstanding Options and the grant in substitution therefor
of new Options under the Plan covering the same or different numbers of Shares,
but having an exercise price per share not less than eighty-five percent (85%)
of the Fair Market Value (in the case of a Ten Percent Stockholder, not less
than one hundred and ten percent (110%) of the Fair Market Value) per Share on
the new grant date.

9. COVENANTS OF THE COMPANY.

   (a) During the terms of the Stock Awards, the Company shall keep available at
all times the number of Shares required to satisfy such Stock Awards.

   (b) The Company shall seek to obtain from each regulatory commission or
agency having jurisdiction over the Plan such authority as may be required to
issue and sell Shares under Stock Awards; provided, however, that this
undertaking shall not require the Company to register under the Securities Act
either the Plan, any Stock Award or any Shares issued or issuable pursuant to
any such Stock Award. If, after reasonable efforts, the Company is unable to
obtain

                                       9.

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from any such regulatory commission or agency the authority which counsel for
the Company deems necessary for the lawful issuance and sale of Shares under the
Plan, the Company shall be relieved from any liability for failure to issue and
sell Shares upon exercise of such Stock Awards unless and until such authority
is obtained.

10. USE OF PROCEEDS FROM SHARES.

    Proceeds from the sale of Shares pursuant to Stock Awards shall constitute
general funds of the Company.

11. MISCELLANEOUS.

    (a) The Board shall have the power to accelerate the time at which all or
any part of a Stock Award may first be exercised or the time during which a
Stock Award or any part thereof will vest, notwithstanding the provisions in the
Stock Award stating the time at which it may first be exercised or the time
during which it will vest.

    (b) No Employee, Consultant or any person to whom an Option is transferred
in accordance with the Plan shall be deemed to be the holder of, or to have any
of the rights of a holder with respect to, any Shares subject to such Option
unless and until such person has satisfied all requirements for exercise of the
Option pursuant to its terms.

    (c) Nothing in the Plan or any instrument executed or Stock Award granted
pursuant thereto shall confer upon any Employee, Consultant or other holder of
Stock Awards any right to continue in the employ of the Company or any Affiliate
or to continue serving as a Consultant or shall affect the right of the Company
or any Affiliate to terminate the employment of any Employee with or without
notice and with or without cause, or the right to terminate the relationship of
any Consultant pursuant to the terms of such Consultant's agreement with the
Company or Affiliate.

    (d) The Company may require any person to whom a Stock Award is granted, or
any person to whom a Stock Award is transferred in accordance with the Plan, as
a condition of exercising or acquiring Shares under any Stock Award, (i) to give
written assurances satisfactory to the Company as to such person's knowledge and
experience in financial and business matters and/or to employ a purchaser
representative reasonably satisfactory to the Company who is knowledgeable and
experienced in financial and business matters, and that he or she is capable of
evaluating, alone or together with the purchaser representative, the merits and
risks associated with the Stock Award, and (ii) to give written assurances
satisfactory to the Company stating that such person is acquiring the Shares
subject to the Stock Award for such person's own account and not with any
present intention of selling or otherwise distributing the Shares. The foregoing
requirements, and any assurances given pursuant to such requirements, shall be
inoperative if (i) the issuance of the Shares upon the exercise or acquisition
of Shares under the Stock Award has been registered under a then currently
effective registration statement under the Securities Act, or (ii) as to any
particular requirement, a determination is made by counsel for the Company that
such requirement need not be met in the circumstances under the then applicable
securities laws. The Company may, upon advice of counsel to the Company, place
legends on stock certificates issued under the Plan as such counsel deems
necessary or appropriate in order to

                                      10.

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comply with applicable securities laws, including, but not limited to, legends
restricting the transfer of the Shares.

    (e) To the extent provided by the terms of a Stock Award Agreement, the
person to whom a Stock Award is granted may satisfy any federal, state or local
tax withholding obligation relating to the exercise or acquisition of Shares
under a Stock Award by any of the following means or by a combination of such
means: (i) tendering a cash payment, (ii) authorizing the Company to withhold
Shares from the Shares otherwise issuable to the participant as a result of the
exercise or acquisition of Shares under the Stock Award or (iii) delivering to
the Company owned and unencumbered Shares, including by delivering to the
Company an attestation of ownership of owned and unencumbered Shares in a form
approved by the Company.

    (f) The terms of any repurchase option shall be specified in the Stock
Award, and the repurchase price may be either the Fair Market Value of the
Shares on the date of termination of Continuous Status or the lower of (i) the
Fair Market Value of the Shares on the date of repurchase or (ii) their original
purchase price. To the extent required by Section 260.140.41 and Section
260.140.42 of Title 10 of the California Code of Regulations at the time a Stock
Award is made, any repurchase option contained in a Stock Award granted to a
person who is not an Officer, Director or Consultant shall be upon the terms
described below:

        (i) FAIR MARKET VALUE. If the repurchase option gives the Company the
right to repurchase the Shares upon termination of Continuous Status at not less
than the Fair Market Value of the Shares to be purchased on the date of
termination of Continuous Status, then (A) the right to repurchase shall be
exercised for cash or cancellation of purchase money indebtedness for the Shares
within ninety (90) days of termination of Continuous Status (or in the case of
Shares issued upon exercise of Stock Awards after such date of termination,
within ninety (90) days after the date of the exercise) or such longer period as
may be agreed to by the Company and the Participant (for example, for purposes
of satisfying the requirements of Section 1202(c)(3) of the Code regarding
"qualified small business stock") and (B) the right terminates when the Shares
become publicly traded.

        (ii) ORIGINAL PURCHASE PRICE. If the repurchase option gives the Company
the right to repurchase the Shares upon termination of Continuous Status at the
lower of (A) the Fair Market Value of the Shares on the date of repurchase or
(B) their original purchase price, then (x) the right to repurchase at the
original purchase price shall lapse at the rate of at least twenty percent (20%)
of the Shares per year over five (5) years from the date the Stock Award is
granted (without respect to the date the Stock Award was exercised or became
exercisable) and (y) the right to repurchase shall be exercised for cash or
cancellation of purchase money indebtedness for the Shares within ninety (90)
days of termination of Continuous Status (or in the case of Shares issued upon
exercise of Options after such date of termination, within ninety (90) days
after the date of the exercise) or such longer period as may be agreed to by the
Company and the Participant (for example, for purposes of satisfying the
requirements of Section 1202(c)(3) of the Code regarding "qualified small
business stock").

    (g) To the extent required by Section 260.140.46 of Title 10 of the
California Code of Regulations, the Company shall deliver financial statements
to Participants at least annually.

                                      11.

<PAGE>

This Section 11(g) shall not apply to key Employees whose duties in connection
with the Company assure them access to equivalent information.

    (h) The Board shall have the authority to effect, at any time and from time
to time, (1) the repricing of any outstanding Options under the Plan and/or (2)
with the consent of any adversely affected holders of Options, the cancellation
of any outstanding Options under the Plan and the grant in substitution
therefore of new Options or other Stock Awards under the Plan covering the same
or different numbers of shares of Common Stock. The exercise price per share of
Common Stock shall be not less than that specified under the Plan for newly
granted Options. Notwithstanding the foregoing, the Board may grant an Option
with an exercise price lower than that set forth above if such Option is granted
as part of a transaction to which Section 424(a) of the Code applies, to the
extent permitted by Section 260.140.41 of Title 10 of the California Code of
Regulations.

12. ADJUSTMENTS UPON CHANGES IN STOCK.

    (a) If any change is made in the Shares subject to the Plan, or subject to
any Stock Award, without the receipt of consideration by the Company (through
merger, consolidation, reorganization, recapitalization, reincorporation, stock
dividend, dividend in property other than cash, stock split, liquidating
dividend, combination of Shares, exchange of Shares, change in corporate
structure or other transaction not involving the receipt of consideration by the
Company), the Plan will be appropriately adjusted in the class(es) and maximum
number of Shares subject to the Plan pursuant to subsection 4(a), and the
outstanding Stock Awards will be appropriately adjusted in the class(es) and
number of Shares and price per Share subject to such outstanding Stock Awards.
Such adjustments shall be made by the Board, the determination of which shall be
final, binding and conclusive. (The conversion of any convertible securities of
the Company shall not be treated as a "transaction not involving the receipt of
consideration by the Company.")

    (b) In the event of: (1) a dissolution, liquidation or sale of substantially
all of the assets of the Company; (2) a merger or consolidation in which the
Company is not the surviving corporation; (3) a reverse merger in which the
Company is the surviving corporation but the shares of the Common Stock
outstanding immediately preceding the merger are converted by virtue of the
merger into other property, whether in the form of securities, cash or
otherwise; or (4) the acquisition by any person, entity or group within the
meaning of Section 13(d) or 14(d) of the Exchange Act, or any comparable
successor provisions (excluding any employee benefit plan, or related trust,
sponsored or maintained by the Company or any Affiliate of the Company) of the
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act, or comparable successor rule) of securities of the Company
representing at least fifty percent (50%) of the combined voting power entitled
to vote in the election of directors, then to the extent permitted by applicable
law: (i) any surviving corporation (or an Affiliate thereof shall assume any
Stock Awards outstanding under the Plan or shall substitute similar Stock Awards
for those outstanding under the Plan, or (ii) such Stock Awards shall continue
in full force and effect. In the event any surviving corporation (or an
Affiliate) refuses to assume or continue such Stock Awards, or to substitute
similar Stock Awards for those outstanding under the Plan, then the Stock Awards
shall be terminated if not exercised prior to such event.

                                      12.

<PAGE>

13. AMENDMENT OF THE PLAN AND STOCK AWARDS.

    (a) The Board at any time, and from time to time, may amend the Plan.

    (b) The Board, in its sole discretion, may submit the Plan and/or any
amendment to the Plan for stockholder approval.

    (c) It is expressly contemplated that the Board may amend the Plan in any
respect the Board deems necessary or advisable to provide those eligible with
the maximum benefits provided or to be provided under the provisions of the Code
and the regulations promulgated thereunder.

    (d) Rights and obligations under any Stock Award granted before amendment of
the Plan shall not be impaired by any amendment of the Plan unless (i) the
Company requests the consent of the person to whom the Stock Award was granted
and (ii) such person consents in writing.

    (e) The Board at any time, and from time to time, may amend the terms of any
one or more Stock Awards; provided, however, that the rights and obligations
under any Stock Award shall not be impaired by any such amendment unless (i) the
Company requests the consent of the person to whom the Stock Award was granted
and (ii) such person consents in writing.

14. TERMINATION OR SUSPENSION OF THE PLAN.

    (a) The Board may suspend or terminate the Plan at any time. So long as the
Plan is subject to Section 260.140.41 of Title 10 of the California Code of
Regulations, the Plan shall terminate ten (10) years from the date the Plan is
adopted by the Board, unless sooner terminated by the Board; otherwise, the Plan
shall terminate when all Shares reserved for issuance under the Plan have been
issued and all such issued Shares are no longer subject to a repurchase option
or a reacquisition option in favor of the Company, unless sooner terminated by
the Board. No Stock Awards may be granted under the Plan while the Plan is
suspended or after it is terminated.

    (b) Rights and obligations under any Stock Award granted while the Plan is
in effect shall not be impaired by suspension or termination of the Plan, except
with the written consent of the person to whom the Stock Award was granted.

15. EFFECTIVE DATE OF PLAN.

    The Plan shall become effective on April 21, 1999.

                                      13.<PAGE>
                                                                    EXHIBIT 10.1

                          AMERICAN PULP EXCHANGE, INC.

                         COMMON STOCK PURCHASE AGREEMENT

         This Common Stock Purchase Agreement (this "AGREEMENT") is made and
entered into as of November 1, 2002, by and between American Pulp Exchange,
Inc., a Florida corporation (the "CORPORATION"), and Vector Partners, LLC, a
Nevada limited liability company (the "INVESTOR").

         WHEREAS, the Corporation desires to sell to the Investor, and the
Investor desires to purchase from the Corporation, shares of the Corporation's
Common Stock on the terms and conditions set forth in this Agreement;

         NOW, THEREFORE, the parties hereby agree as follows:

         1. AGREEMENT TO PURCHASE AND SELL STOCK.

            1.1 AUTHORIZATION. As of the Closing (as defined below), the
Corporation will have authorized the sale and issuance, pursuant to the terms
and conditions of this Agreement, of Nine Hundred Thirty Thousand (930,000)
shares of the Corporation's Common Stock, $0.0025 par value per share (the
"PURCHASED SHARES").

            1.2 AGREEMENT TO PURCHASE AND SELL. The Corporation agrees to sell
to the Investor at the Closing, and the Investor agrees to purchase from the
Corporation at the Closing, the Purchased Shares, at a per share purchase price
of One Cent ($0.01), and at the aggregate purchase price of Nine Thousand Three
Hundred Dollars ($9,300.00), in consideration of past services rendered to the
Corporation in connection with its organization, valued at Nine Thousand Three
Hundred Dollars ($9,300.00).

         2. CLOSING. The purchase and sale of the Purchased Shares will take
place at the offices of Pachulski, Stang, Ziehl, Young & Jones P.C., 10100 Santa
Monica Boulevard, Suite 1100, Los Angeles, California 90067, at 10:00 a.m.
Pacific Time, on November 4, 2002 or at such other time and place as the
Corporation and the Investor mutually agree upon (which time and place are
referred to in this Agreement as the "CLOSING"). At the Closing, the Corporation
will deliver to the Investor a share certificate representing the Purchased
Shares that the Investor has agreed to purchase against delivery to the
Corporation by such Investor of the full purchase price of such Purchased
Shares, paid in cash by wire transfer of funds to the Corporation.

         3. REPRESENTATIONS AND WARRANTIES OF THE CORPORATION. The Corporation
hereby represents and warrants to the Investor that the statements in the
following paragraphs of this Section 3 are all true and complete immediately
prior to the Closing:

            3.1 ORGANIZATION, GOOD STANDING, CORPORATE POWER AND QUALIFICATION.
The Corporation has been duly incorporated and organized, and is validly
existing in good standing, under the laws of the State of Florida. The
Corporation has the requisite corporate power and authority to enter into and
perform this Agreement, to own and operate its properties and assets, if any,
and to carry on its business as currently conducted and as presently proposed to
be conducted. The Corporation is not presently qualified to do business as a
foreign corporation in any jurisdiction and the failure to be so qualified will
not have a materially adverse affect on the Corporation's business as now
conducted or as now proposed to be conducted.

            3.2 CAPITALIZATION. The capitalization of the Corporation
immediately prior to the Closing consists of the following:
<PAGE>
                (a) PREFERRED STOCK. A total of 20,000,000 authorized shares of
preferred stock, $0.0025 par value per share (the "PREFERRED STOCK"), consisting
of shares designated as "SERIES A PREFERRED STOCK," none of which will be issued
and outstanding, and shares designated as "SERIES B PREFERRED STOCK," none of
which will be issued and outstanding.

                (b) COMMON STOCK. A total of 50,000,000 authorized shares of
Common Stock, $ 0.0025 par value per share (the "COMMON STOCK"), of which
4,345,000 shares will be issued and outstanding.

                (c) OPTIONS, WARRANTS, RESERVED SHARES. Except under this
Agreement, the Stock Purchase Agreement dated October 22, 2002, between Al
Siegel and Investor, and the Common Stock Purchase Agreement dated as of even
date herewith between the Corporation and PH Capital Holdings, LLC, to the
Corporation's knowledge (a) there is no outstanding option, warrant, right
(including conversion or preemptive rights) or agreement for the purchase or
acquisition from the Corporation of any shares of its capital stock or any
securities convertible into or ultimately exchangeable or exercisable for any
shares of the Corporation's capital stock and (b) no shares of the Corporation's
outstanding capital stock are subject to any preemptive rights, rights of first
refusal or other rights to purchase such stock.

            3.3 DUE AUTHORIZATION. All corporate action on the part of the
Corporation's director(s) and shareholders necessary for (i) the authorization,
execution, delivery of, and the performance of all obligations of the
Corporation under, this Agreement and (ii) the authorization, issuance,
reservation for issuance and delivery of all of the Purchased Shares being sold
under this Agreement has been taken or will be taken prior to the Closing. This
Agreement, when executed and delivered, will constitute, valid and legally
binding obligations of the Corporation, enforceable in accordance with their
respective terms, except as may be limited by (i) applicable bankruptcy,
insolvency, reorganization or others laws of general application relating to or
affecting the enforcement of creditors' rights generally and (ii) the effect of
rules of law governing the availability of equitable remedies.

            3.4 VALID ISSUANCE OF STOCK.

                (a) The Purchased Shares, when paid for and issued as provided
in this Agreement, will be duly authorized and validly issued, fully paid and
nonassessable.

                (b) Based in part on the representations made by the Investor in
Section 4 hereof, the offer and sale of the Purchased Shares solely to the
Investor in accordance with this Agreement are exempt from the registration and
prospectus delivery requirements of the Securities Act of 1933, as amended (the
"SECURITIES ACT") and the securities registration and qualification requirements
of the currently effective provisions of the securities laws of the State in
which the Investor is resident.

            3.5 GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state or local governmental authority is required on
the part of the Corporation in order to enable the Corporation to execute,
deliver and perform its obligations under this Agreement except for such
qualifications or filings under applicable securities laws as may be required in
connection with the transactions contemplated by this Agreement. All such
qualifications and filings will, in the case of qualifications, be effective on
the Closing and will, in the case of filings, be made within the time prescribed
by law.

            3.6 REGISTRATION RIGHTS. The Corporation is not under any obligation
to register under the Securities Act any of its currently outstanding securities
or any securities issuable upon exercise or conversion of its currently
outstanding securities nor is the Corporation obligated to register or qualify
any such securities under any state securities or blue sky laws.

         4. REPRESENTATIONS, WARRANTIES AND CERTAIN AGREEMENTS OF THE INVESTOR.
The Investor hereby represents and warrants to, and agrees with, the Corporation
that:

                                       2
<PAGE>
            4.1 AUTHORIZATION. This Agreement constitutes such Investor's valid
and legally binding obligation, enforceable in accordance with its terms except
as may be limited by (i) applicable bankruptcy, insolvency, reorganization or
other laws of general application relating to or affecting the enforcement of
creditors' rights generally and (ii) the effect of rules of law governing the
availability of equitable remedies. The Investor represents that such Investor
has full power and authority to enter into this Agreement.

            4.2 PURCHASE FOR OWN ACCOUNT. The Purchased Shares to be purchased
by such Investor hereunder will be acquired for investment for such Investor's
own account, not as a nominee or agent, and not with a view to the public resale
or distribution thereof within the meaning of the Securities Act, and such
Investor has no present intention of selling, granting any participation in, or
otherwise distributing the same. The Investor also represents that it has not
been formed for the specific purpose of acquiring the Purchased Shares.

            4.3 DISCLOSURE OF INFORMATION. At no time was the Investor presented
with or solicited by any publicly issued or circulated newspaper, mail, radio,
television or other form of general advertising or solicitation in connection
with the offer, sale and purchase of the Purchased Shares. Such Investor has
received or has had full access to all the information it considers necessary or
appropriate to make an informed investment decision with respect to the
Purchased Shares to be purchased by such Investor under this Agreement. Such
Investor further has had an opportunity to ask questions and receive answers
from the Corporation regarding the terms and conditions of the offering of the
Purchased Shares and to obtain additional information (to the extent the
Corporation possessed such information or could acquire it without unreasonable
effort or expense) necessary to verify any information furnished to such
Investor or to which such Investor had access.

            4.4 INVESTMENT EXPERIENCE. Such Investor understands that the
purchase of the Purchased Shares involves substantial risk. Such Investor: (i)
has experience as an investor in securities and acknowledges that such Investor
is able to fend for itself, can bear the economic risk of such Investor's
investment in the Purchased Shares and has such knowledge and experience in
financial or business matters that such Investor is capable of evaluating the
merits and risks of this investment in the Purchased Shares and protecting its
own interests in connection with this investment and/or (ii) has a preexisting
personal or business relationship with the Corporation and certain of its
officers, directors or controlling persons of a nature and duration that enables
such Investor to be aware of the character, business acumen and financial
circumstances of such persons.

            4.5 ACCREDITED INVESTOR STATUS. Such Investor is an "accredited
investor" within the meaning of Regulation D promulgated under the Securities
Act.

            4.6 RESTRICTED SECURITIES. Such Investor understands that the
Purchased Shares are characterized as "restricted securities" under the
Securities Act inasmuch as they are being acquired from the Corporation in a
transaction not involving a public offering and that under the Securities Act
and applicable regulations thereunder such securities may be resold without
registration under the Securities Act only in certain limited circumstances. In
this connection, such Investor represents that such Investor is familiar with
Rule 144 of the U.S. Securities and Exchange Commission (the "SEC"), as
presently in effect, and understands the resale limitations imposed thereby and
by the Securities Act. Such Investor understands that the Corporation is under
no obligation to register any of the securities sold hereunder except as
provided in the Registration Rights Agreement.

            4.7 FURTHER LIMITATIONS ON DISPOSITION. Without in any way limiting
the representations set forth above, such Investor further agrees not to make
any disposition of all or any portion of the Purchased Shares unless and until:

                (a) there is then in effect a registration statement under the
Securities Act covering such proposed disposition and such disposition is made
in accordance with such registration statement; or

                                       3
<PAGE>
                (b) such Investor shall have notified the Corporation of the
proposed disposition and shall have furnished the Corporation with a statement
of the circumstances surrounding the proposed disposition, and, at the expense
of such Investor or its transferee, with an opinion of counsel, reasonably
satisfactory to the Corporation, that such disposition will not require
registration of such securities under the Securities Act.

         Notwithstanding the provisions of paragraphs (a) and (b) above, no such
registration statement or opinion of counsel shall be required for any transfer
of any Purchased Shares in compliance with SEC Rule 144.

            4.8 "MARKET STAND-OFF" AGREEMENT. The Investor hereby agrees that it
shall not, to the extent requested by the Corporation or an underwriter of
securities of the Corporation, sell or otherwise transfer or dispose of any
Purchased Shares or other shares of stock of the Corporation then owned by such
Investor (other than to donees or partners of the Investor who agree to be
similarly bound) for up to One Hundred Eighty (180) days following the effective
date of any registration statement of the Corporation filed under the Securities
Act; provided that, notwithstanding a request by the Corporation, Investor shall
not be restricted under this Section 4.8 from selling or otherwise transferring
or disposing of any Purchased Shares or other shares of stock of the Corporation
at any time prior to the effective date of any registration statement.

         In order to enforce the foregoing covenant, the Corporation shall have
the right to place restrictive legends on the certificates representing the
shares subject to this Section and to impose stop transfer instructions with
respect to the Purchased Shares and such other shares of stock of the Investor
(and the shares or securities of every other person subject to the foregoing
restriction) until the end of such period. The Investor further agrees to enter
into any agreement reasonably required by the underwriters to implement the
foregoing within any reasonable timeframe so requested.

            4.9 LEGENDS. It is understood that the certificates evidencing the
Purchased Shares will bear the legends substantially similar to those set forth
below:

                (a) THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR UNDER THE
SECURITIES LAWS OF ANY OTHER JURISDICTIONS. THESE SECURITIES ARE SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS,
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. THE ISSUER OF THESE SECURITIES
MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE
ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH
THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

         THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A 180 DAY
MARKET STAND-OFF RESTRICTION AS SET FORTH IN A CERTAIN AGREEMENT BETWEEN THE
ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED
AT THE PRINCIPAL OFFICE OF THE ISSUER. AS A RESULT OF SUCH AGREEMENT, THESE
SHARES MAY NOT BE TRADED PRIOR TO 180 DAYS AFTER THE EFFECTIVE DATE OF THE
INITIAL PUBLIC OFFERING OF THE COMMON STOCK OF THE ISSUER HEREOF. SUCH
RESTRICTION IS BINDING ON TRANSFEREES OF THESE SHARES.

                (b) Any legends required by applicable state securities laws.

                (c) Any legends required by any agreement(s) between the
Corporation and the Investor.

                                       4
<PAGE>
         The first legend set forth in (a) above shall be removed by the
Corporation from any certificate evidencing Purchased Shares upon delivery to
the Corporation of an opinion by counsel, reasonably satisfactory to the
Corporation, that a registration statement under the Securities Act is at that
time in effect with respect to the legended security or that such security can
be freely transferred in a public sale without such a registration statement
being in effect and that such transfer will not jeopardize the exemption or
exemptions from registration pursuant to which the Corporation issued the
Purchased Shares.

         5. CONDITIONS TO INVESTOR'S OBLIGATIONS AT CLOSING. The obligations
of the Investor under Section 2 of this Agreement are subject to the fulfillment
or waiver, on or before the Closing, of each of the following conditions, the
waiver of which shall not be effective unless the Investor consents to such
waiver, which consent may be given by written, oral or telephone communication
to the Corporation:

            5.1 REPRESENTATIONS AND WARRANTIES TRUE. Each of the representations
and warranties of the Corporation contained in Section 3 hereof shall be true
and complete on and as of the Closing with the same effect as though such
representations and warranties had been made on and as of the date of the
Closing.

            5.2 PERFORMANCE. The Corporation shall have performed and complied
with all agreements, obligations and conditions contained in this Agreement that
are required to be performed or complied with by it on or before the Closing and
shall have obtained all approvals, consents and qualifications necessary to
complete the purchase and sale described herein.

            5.3 SECURITIES EXEMPTIONS. The offer and sale of the Purchased
Shares to the Investor pursuant to this Agreement shall be exempt from the
registration requirements of the Securities Act and the registration and/or
qualification requirements of all other applicable state securities laws.

            5.4 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
in connection with the transactions contemplated at the Closing and all
documents incident thereto shall be reasonably satisfactory in form and
substance to the Investor and to the Investor's counsel, and they shall each
have received all such counterpart originals and certified or other copies of
such documents as they may reasonably request.

         6. CONDITIONS TO THE CORPORATION'S OBLIGATIONS AT CLOSING. The
obligations of the Corporation to the Investor under this Agreement are subject
to the fulfillment or waiver on or before the Closing of each of the following
conditions by such Investor:

            6.1 REPRESENTATIONS AND WARRANTIES. The representations and
warranties of such Investor contained in Section 4 shall be true and complete on
the date of the Closing with the same effect as though such representations and
warranties had been made on and as of the Closing.

            6.2 PAYMENT OF PURCHASE PRICE. The Investor shall have delivered to
the Corporation the purchase price specified in Section 2.

            6.3 SECURITIES EXEMPTIONS. The offer and sale of the Purchased
Shares to the Investor pursuant to this Agreement shall be exempt from the
registration requirements of the Securities Act and the registration and/or
qualification requirements of all other applicable state securities laws.

            6.4 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
in connection with the transactions contemplated at the Closing and all
documents incident thereto shall be reasonably satisfactory in form and
substance to the Corporation and to the Corporation's legal counsel, and the
Corporation shall have received all such counterpart originals and certified or
other copies of such documents as it may reasonably request.

                                       5
<PAGE>
         7. GENERAL PROVISIONS.

            7.1 SURVIVAL OF WARRANTIES. The representations, warranties and
covenants of the Corporation and the Investor contained in or made pursuant to
this Agreement shall survive the execution and delivery of this Agreement and
the Closing and shall in no way be affected by any investigation of the subject
matter thereof made by or on behalf of the Investor, their counsel or the
Corporation, as the case may be.

            7.2 SUCCESSORS AND ASSIGNS. Except as otherwise provided in this
Agreement, this Agreement, and the rights and obligations of the parties
hereunder, will be binding upon and inure to the benefit of their respective
successors, assigns, heirs, executors, administrators and legal representatives.

            7.3 GOVERNING LAW. This Agreement will be governed by and construed
in accordance with the laws of the State of California, without giving effect to
that body of laws pertaining to conflict of laws.

            7.4 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered will be deemed an
original, and all of which together shall constitute one and the same agreement.

            7.5 TITLES AND HEADINGS. The titles, captions and headings of this
Agreement are included for ease of reference only and will be disregarded in
interpreting or construing this Agreement. Unless otherwise specifically stated,
all references herein to "sections" will mean "sections" to this Agreement.

            7.6 NOTICES. All notices, requests, demands and other communications
which are required to be given under this Agreement shall be in writing and
shall be deemed to have been duly given, made and received only when transmitted
if: (a) transmitted by facsimile, upon printed confirmation of complete
transmission by facsimile; (b) delivered (personally, by courier service or by
other messenger; or (c) when deposited in the United States mails, registered or
certified mail, postage prepaid, return receipt requested, addressed as set
forth below:

                (a) if to the Investor:

                    Vector Partners, LLC
                    Attention:  Jason W. Galanis
                    1518 North Beverly Drive
                    Beverly Hills, California  90210

                    With a copy to:

                    Meltzer, Lippe, Goldstein & Schlissel, LLP
                    Attention:  Richard Reichler, Esq.
                    190 Willis Avenue
                    Mineola, New York  11501

                (b) if to the Corporation:

                    American Pulp Exchange, Inc.
                    Attention:  President
                    1518 North Beverly Drive
                    Beverly Hills, California  90210

                    With a copy to:

                    Robert J. Feinstein, Esq.
                    Pachulski, Stang, Ziehl, Young & Jones P.C.

                                       6
<PAGE>
                    461 Fifth Ave
                    25th Floor
                    New York, NY  10017

            7.7 NO FINDER'S FEES. Each party represents that it neither is nor
will be obligated for any finder's or broker's fee or commission in connection
with this transaction. The Investor agrees to indemnify and to hold harmless the
Corporation from any liability for any commission or compensation in the nature
of a finders' or broker's fee (and any asserted liability) for which the
Investor or any of its officers, partners, employees, or representatives is
responsible. The Corporation agrees to indemnify and hold harmless the Investor
from any liability for any commission or compensation in the nature of a
finder's or broker's fee (and any asserted liability) for which the Corporation
or any of its officers, employees or representatives is responsible.

            7.8 AMENDMENTS AND WAIVERS. Any term of this Agreement may be
amended and the observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Corporation and the
Investor. Any amendment or waiver effected in accordance with this Section shall
be binding upon the Investor, each future holder of the Purchased Shares, and
the Corporation. No delay or failure to require performance of any provision of
this Agreement shall constitute a waiver of that provision as to that or any
other instance. No waiver granted under this Agreement as to any one provision
herein shall constitute a subsequent waiver of such provision or of any other
provision herein, nor shall it constitute the waiver of any performance other
than the actual performance specifically waived.

            7.9 SEVERABILITY. If any provision of this Agreement is determined
by any court or arbitrator of competent jurisdiction to be invalid, illegal or
unenforceable in any respect, such provision will be enforced to the maximum
extent possible given the intent of the parties hereto. If such clause or
provision cannot be so enforced, such provision shall be stricken from this
Agreement and the remainder of this Agreement shall be enforced as if such
invalid, illegal or unenforceable clause or provision had (to the extent not
enforceable) never been contained in this Agreement. Notwithstanding the
forgoing, if the value of this Agreement based upon the substantial benefit of
the bargain for any party is materially impaired, which determination as made by
the presiding court or arbitrator of competent jurisdiction shall be binding,
then both parties agree to substitute such provision(s) through good faith
negotiations.

            7.10 ENTIRE AGREEMENT. This Agreement and the documents referred to
herein constitute the entire agreement and understanding of the parties with
respect to the subject matter of this Agreement, and supersede any and all prior
understandings and agreements, whether oral or written, between or among the
parties hereto with respect to the specific subject matter hereof.

            7.11 FURTHER ASSURANCES. The parties agree to execute such further
documents and instruments and to take such further actions as may be reasonably
necessary to carry out the purposes and intent of this Agreement.

            7.12 FACSIMILE SIGNATURES. This Agreement may be executed and
delivered by facsimile and upon such delivery the facsimile signature will be
deemed to have the same effect as if the original signature had been delivered
to the other party.

            7.13 THIRD PARTIES. Nothing in this Agreement, express or implied,
is intended to confer upon any person, other than the parties hereto and their
successors and assigns, any rights or remedies under or by reason of this
Agreement

            7.14 COSTS AND ATTORNEYS' FEES. In the event that any action, suit
or other proceeding is instituted concerning or arising out of this Agreement or
any transaction contemplated hereunder, the prevailing party shall recover all
of such party's costs and attorneys' fees incurred in each such action, suit or
other proceeding, including any and all appeals or petitions therefrom.

                                       7
<PAGE>
         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.

THE CORPORATION:

AMERICAN PULP EXCHANGE, INC.,
a Florida corporation

By:      s/s  Jason Galanis
         --------------------------------------
Name:    Jason W. Galanis

Title:   Chairman, President, CFO and Secretary

INVESTOR:

VECTOR PARTNERS, LLC,
a Nevada limited liability company

By:      s/s  Jason Galanis
         --------------------------------------
         Jason W. Galanis, its Manager

               [SIGNATURE PAGE TO COMMON STOCK PURCHASE AGREEMENT]

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