EXHIBIT 10.8

                      BRILLIANT DIGITAL ENTERTAINMENT, INC.
                           DEFERRED COMPENSATION PLAN

         WHEREAS,   Brilliant  Digital   Entertainment,   Inc.  ("Company")  has
previously asked two of its executives, Kevin Bermeister and Mark Dyne, to defer
their  salary from the Company  until July 1, 2004,  or, if earlier,  until such
time as the Company,  in its sole and  absolute  discretion,  has the  financial
ability to make such salary payments; and

         WHEREAS, Kevin Bermeister and Mark Dyne agreed to the deferral of their
salary at the Company's request provided the salary deferred accrued interest at
the rate of 8%; and

         WHEREAS,   the   Company   wishes  to  formally   document   the  prior
understanding of the Company with Kevin Bermeister and Mark Dyne.

         WHEREAS, the Company intends that this Brilliant Digital Entertainment,
Inc. deferred  compensation  plan qualify as an unfunded  deferred  compensation
plan  for  the  benefit  of  management  and  highly  compensated  employees  in
accordance   with  Title  29,  section   2520.104.23  of  the  Code  of  Federal
Regulations.

         NOW,  THEREFORE,  the Company hereby adopts this Deferred  Compensation
Plan as of the date set forth below to read as follows:
ARTICLE I

                              TITLE AND DEFINITIONS

         1.1      DEFINITIONS.

                  Whenever  the  following  words and  phrases  are used in this
Plan, with the first letter capitalized,  they shall have the meanings specified
below.

                  (a)      "Beneficiary"  or  "Beneficiaries"   shall  mean  the
person  or  persons,  including  a  trustee,  personal  representative  or other
fiduciary,  last  designated  in writing by a  Participant  in  accordance  with
procedures  established  by the  Committee  to receive  the  benefits  specified
hereunder in the event of the  Participant's  death. No beneficiary  designation
shall become  effective  until it is filed with the Committee.  Any  designation
shall be  revocable  at any  time  through  a  written  instrument  filed by the
Participant  with the  Committee  with or without  the  consent of the  previous
Beneficiary. No designation of a Beneficiary other than the Participant's spouse
shall be valid unless  consented  to in writing by such  spouse.  If there is no
such designation or if there is no surviving  designated  Beneficiary,  then the
Participant's  surviving  spouse  shall  be  the  Beneficiary.  If  there  is no
surviving  spouse  to  receive  any  benefits  payable  in  accordance  with the
preceding   sentence,   the  duly  appointed  and  currently   acting   personal
representative  of the  Participant's  estate  (which shall  include  either the
Participant's  probate estate or living trust) shall be the Beneficiary.  In any
case where there is no such personal


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representative  of the  Participant's  estate duly  appointed and acting in that
capacity within 90 days after the  Participant's  death (or such extended period
as the  Committee  determines  is  reasonably  necessary to allow such  personal
representative  to  be  appointed,   but  not  to  exceed  180  days  after  the
Participant's  death), then Beneficiary shall mean the person or persons who can
verify by affidavit or court order to the  satisfaction  of the  Committee  that
they are legally entitled to receive the benefits  specified  hereunder.  In the
event any amount is payable under the Plan to a minor, payment shall not be made
to the minor,  but instead be paid (a) to that person's living  parent(s) to act
as custodian,  (b) if that person's parents are then divorced, and one parent is
the sole custodial parent, to such custodial parent, or (c) if no parent of that
person is then  living,  to a custodian  selected by the  Committee  to hold the
funds for the minor under the Uniform Transfers or Gifts to Minors Act in effect
in the  jurisdiction in which the minor resides.  If no parent is living and the
Committee  decides  not to select  another  custodian  to hold the funds for the
minor,  then payment shall be made to the duly  appointed  and currently  acting
guardian  of the estate for the minor or, if no  guardian  of the estate for the
minor is duly  appointed and currently  acting within 60 days after the date the
amount  becomes  payable,  payment  shall be  deposited  with the  court  having
jurisdiction  over the estate of the minor.  Payment by Company  pursuant to any
unrevoked  Beneficiary  designation,  or to the Participant's  estate if no such
designation  exists,  of all benefits owed hereunder shall terminate any and all
liability of Company.

                  (b)      "Board of  Directors" or "Board" shall mean the Board
of Directors of Company.

                  (c)      "Code" shall mean the Internal  Revenue Code of 1986,
as amended.

                  (d)      "Committee" shall mean the Committee appointed by the
Board to administer the Plan in accordance with Article V.

                  (e)      "Company" shall mean Brilliant Digital Entertainment,
Inc.

                  (f)      "Compensation" shall be the Participant's base salary
commencing January 1, 1997.

                  (g)      "Deferral   Account"  or  "Account"  shall  mean  the
bookkeeping  account  maintained by the Committee for each  Participant  that is
credited with amounts equal to (1) the portion of the Participant's Compensation
that has been deferred, and (2) earnings and losses pursuant to Article III. The
Company may, in its sole and absolute  discretion,  invest or deposit all or any
portion of the amounts credited to the Account in an account or fund established
with a federally insured banking  institution or savings and loan association or
any other  institution  on whatever  terms it may see fit and without  fiduciary
responsibility  of any kind  whatsoever.  A  Participant  shall have no right to
require or compel any such investment, but shall be credited or debited with any
earnings,  interests or losses  thereon.  The Account  shall  constitute  only a
bookkeeping  entry by the Company for purposes of  facilitating  the benefits to
which the  Participant  is entitled  hereunder and shall not  constitute a trust
fund or escrow account nor any form of asset segregation.


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<PAGE>


                  (h)      "Disability"  shall mean the Participant's  inability
to  perform  each  and  every  duty  of his or her  occupation  or  position  of
employment  due to  illness  or injury as  determined  in the sole and  absolute
discretion of the Committee.

                  (i)      "Distributable  Amount" shall mean the balance in the
Participant's Account.

                  (j)      "Participant"   shall   mean   Mark  Dyne  and  Kevin
Bermeister.

                  (k)      "Payment  Date"  shall  be  the  time  set  forth  in
accordance with Article V.

                  (l)      "Plan"    shall    mean   the    Brilliant    Digital
Entertainment, Inc. Deferred Compensation Plan.

                  (m)      "Plan  Year"  shall be the twelve  (12) month  period
beginning each January 1 and ending December 31.

                                   ARTICLE II

                                  PARTICIPATION

                  Each Participant is deemed to have commenced  participation in
this Plan upon the  Participant's  agreement  to allow the  Company to defer his
Compensation.

                                   ARTICLE III

                                    DEFERRALS

                  Each   Participant   has   agreed   that  he  will  defer  his
Compensation  until July 1, 2004.  In this  regard,  the amount of  Compensation
deferred by the  Participant  shall be credited  with interest at the rate of 8%
per annum until all amounts of deferred Compensation are paid in full.

                                   ARTICLE IV

                                  DISTRIBUTIONS

                  Company  shall  distribute  the  balance  of  a  Participant's
Account to such Participant in a lump sum on July 1, 2004. If, in Company's sole
and absolute discretion,  Company has the financial ability to distribute all or
any portion of a Participant's  Account to a Participant  prior to July 1, 2004,
Company  shall  have the  right,  but not the  obligation,  to  distribute  to a
Participant all or any portion of such Participant's  Account.  Company reserves
the right to make any  distribution  of a  Participant's  Account  in cash or in
Company stock of equal value.

                  In the event a Participant dies prior to receipt of his entire
Account,  his  Beneficiary  shall  succeed  to his  interest  and shall  receive
distributions in accordance with this Article IV.


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<PAGE>


                                   ARTICLE V

                                 ADMINISTRATION

         5.1      COMMITTEE.

                  A committee  shall be appointed  by, and serve at the pleasure
of, the Board of Directors. The number of members comprising the Committee shall
be  determined  by the  Board,  which may from  time to time vary the  number of
members.  A member of the Committee may resign by delivering a written notice of
resignation  to the  Board.  The Board may remove  any  member by  delivering  a
certified  copy of its  resolution  of removal to such member.  Vacancies in the
membership of the Committee  shall be filled promptly by the Board. If the Board
does not appoint a committee,  than the Compensation  Committee of the Board or,
in the absence of a Compensation Committee,  the full Board shall constitute the
Committee.

         5.2      COMMITTEE ACTION.

                  The Committee  shall act at meetings by affirmative  vote of a
majority of the members of the Committee.  Any action permitted to be taken at a
meeting  may be taken  without a meeting  if,  prior to such  action,  a written
consent to the action is signed by all members of the Committee and such written
consent is filed with the minutes of the proceedings of the Committee.  A member
of the Committee  shall not vote or act upon any matter which relates  solely to
himself or herself as a Participant. The Chairman or any other member or members
of the Committee designated by the Chairman may execute any certificate or other
written direction on behalf of the Committee.

         5.3      POWERS AND DUTIES OF THE COMMITTEE.

                  (a)      The  Committee,  on  behalf of the  Participants  and
their Beneficiaries,  shall enforce the Plan in accordance with its terms, shall
be  charged  with the  general  administration  of the Plan,  and shall have all
powers  necessary  to  accomplish  its  purposes,  including,  but not by way of
limitation, the following:

                           (1)      To  construe  and  interpret  the  terms and
provisions of this Plan;

                           (2)      To  compute  and  certify  to the amount and
kind of benefits payable to Participants and their Beneficiaries;

                           (3)      To  maintain   all   records   that  may  be
necessary for the administration of the Plan;

                           (4)      To  provide  for  the   disclosure   of  all
information  and the  filing or  provision  of all  reports  and  statements  to
Participants,  Beneficiaries  or  governmental  agencies as shall be required by
law;

                           (5)      To  make  and  publish  such  rules  for the
regulation of the Plan and procedures for the  administration of the Plan as are
not inconsistent with the terms hereof;


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                           (6)      To appoint a Plan administrator or any other
agent,  and to delegate to them such  powers and duties in  connection  with the
administration of the Plan as the Committee may from time to time prescribe; and

                           (7)      To  take  all  actions   necessary  for  the
administration of the Plan, including determining whether to hold or discontinue
the Policies.

         5.4      CONSTRUCTION AND INTERPRETATION.

                  The  Committee  shall have full  discretion  to  construe  and
interpret  the terms and  provisions  of this  Plan,  which  interpretations  or
construction  shall be final  and  binding  on all  parties,  including  but not
limited to the Company and any Participant or  Beneficiary.  The Committee shall
administer such terms and provisions in a uniform and  nondiscriminatory  manner
and in full accordance with any and all laws applicable to the Plan.

         5.5      INFORMATION.

                  To enable the Committee to perform its functions,  the Company
shall  supply  full and  timely  information  to the  Committee  on all  matters
relating to the  Compensation of all  Participants,  their death or other events
which cause  termination  of their  participation  in this Plan,  and such other
pertinent facts as the Committee may require.

         5.6      COMPENSATION, EXPENSES AND INDEMNITY.

                  (a)      The  members of the  Committee  shall  serve  without
compensation for their services hereunder.

                  (b)      The  Committee  is  authorized  at the expense of the
Company to employ such legal  counsel as it may deem  advisable to assist in the
performance of its duties  hereunder.  Expenses and fees in connection  with the
administration of the Plan shall be paid by the Company.

                  (c)      To the extent  permitted by applicable state law, the
Company shall indemnify and hold harmless the Committee and each member thereof,
the Board of Directors  and any delegate of the  Committee who is an employee of
the Company  against any and all  expenses,  liabilities  and claims,  including
legal fees to defend  against such  liabilities  and claims arising out of their
discharge in good faith of responsibilities under or incident to the Plan, other
than expenses and liabilities arising out of willful misconduct.  This indemnity
shall not preclude such further  indemnities as may be available under insurance
purchased by the Company or provided by the Company  under any bylaw,  agreement
or otherwise, as such indemnities are permitted under state law.

         5.7      DISPUTES.

                  (a)      CLAIM.

                  A person who believes that he or she is being denied a benefit
to which he or she is  entitled  under  this Plan  (hereinafter  referred  to as
"Claimant")  must file a written  request  for


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such benefit with the Company,  setting forth his or her claim. The request must
be addressed  to the  President  of the Company at its then  principal  place of
business.

                  (b)      CLAIM DECISION.

                  Upon receipt of a claim, the Company shall advise the Claimant
that a reply will be  forthcoming  within  ninety (90) days and shall,  in fact,
deliver  such reply within such period.  The Company  may,  however,  extend the
reply period for an additional ninety (90) days for special circumstances.

                  If the claim is denied in whole or in part,  the Company shall
inform the Claimant in writing,  using  language  calculated to be understood by
the  Claimant,  setting  forth:  (A) the  specified  reason or reasons  for such
denial; (B) the specific reference to pertinent provisions of this Plan on which
such  denial  is  based;  (C)  a  description  of  any  additional  material  or
information  necessary  for the  Claimant  to  perfect  his or her  claim and an
explanation  of  why  such  material  or  such  information  is  necessary;  (D)
appropriate  information  as to the steps to be taken if the Claimant  wishes to
submit the claim for  review;  and (E) the time limits for  requesting  a review
under subsection (c).

                  (c)      REQUEST FOR REVIEW.

                  Within  sixty (60) days after the  receipt by the  Claimant of
the written opinion  described  above,  the Claimant may request in writing that
the  Committee  review the  determination  of the Company.  Such request must be
addressed  to the  Secretary  of the  Company,  at its then  principal  place of
business.  The Claimant or his or her duly  authorized  representative  may, but
need not,  review the  pertinent  documents  and submit  issues and  comments in
writing for  consideration by the Committee.  If the Claimant does not request a
review within such sixty (60) day period, he or she shall be barred and estopped
from challenging the Company's determination.

                  (d)      REVIEW OF DECISION.

                  Within  sixty  (60) days  after the  Committee's  receipt of a
request for review,  after considering all materials  presented by the Claimant,
the Committee will inform the Participant in writing,  in a manner calculated to
be understood by the Claimant,  the decision  setting forth the specific reasons
for the decision containing  specific references to the pertinent  provisions of
this Plan on which the decision is based. If special  circumstances require that
the sixty (60) day time period be  extended,  the  Committee  will so notify the
Claimant and will render the decision as soon as possible, but no later than one
hundred twenty (120) days after receipt of the request for review.


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<PAGE>


                                   ARTICLE VI

                                  MISCELLANEOUS

         6.1      UNSECURED GENERAL CREDITOR.

                  Participants and their Beneficiaries,  heirs, successors,  and
assigns  shall have no legal or  equitable  rights,  claims,  or interest in any
specific  property or assets of the Company.  No assets of the Company  shall be
held in any way as collateral  security for the fulfilling of the obligations of
the Company under this Plan.  Any and all of the Company's  assets shall be, and
remain, the general unpledged, unrestricted assets of the Company. The Company's
obligation  under the Plan shall be merely  that of an  unfunded  and  unsecured
promise  of the  Company  to pay  money in the  future,  and the  rights  of the
Participants  and  Beneficiaries  shall be no greater  than  those of  unsecured
general creditors. It is the intention of the Company that this Plan be unfunded
for purposes of the Code and for purposes of Title 1 of the Employee  Retirement
Income Security Act of 1974, as amended ("ERISA").

         6.2      RESTRICTION AGAINST ASSIGNMENT.

                  The Company shall pay all amounts  payable  hereunder  only to
the  person or  persons  designated  by the Plan and not to any other  person or
corporation.  No part of a Participant's Accounts shall be liable for the debts,
contracts,  or  engagements  of any  Participant,  his or  her  Beneficiary,  or
successors  in  interest,  nor shall a  Participant's  Accounts  be  subject  to
execution by levy, attachment, or garnishment or by any other legal or equitable
proceeding,  nor shall any such person have any right to  alienate,  anticipate,
sell, transfer,  commute,  pledge,  encumber, or assign any benefits or payments
hereunder in any manner whatsoever. If any Participant, Beneficiary or successor
in interest is adjudicated bankrupt or purports to anticipate,  alienate,  sell,
transfer,  commute,  assign,  pledge,  encumber  or charge any  distribution  or
payment from the Plan,  voluntarily  or  involuntarily,  the  Committee,  in its
discretion,  may cancel such distribution or payment (or any part thereof) to or
for the benefit of such  Participant,  Beneficiary  or  successor in interest in
such manner as the Committee shall direct.

         6.3      WITHHOLDING.

                  There shall be deducted  from each payment made under the Plan
or any other Compensation  payable to the Participant (or Beneficiary) all taxes
which are  required to be withheld by the Company in respect to such  payment or
this  Plan.  The  Company  shall  have  the  right to  reduce  any  payment  (or
compensation)  by the amount of cash  sufficient  to provide  the amount of said
taxes.

         6.4      AMENDMENT, MODIFICATION, SUSPENSION OR TERMINATION.

                  The Committee may amend, modify, suspend or terminate the Plan
in whole or in part,  except  that no  amendment,  modification,  suspension  or
termination shall have any retroactive effect to reduce any amounts allocated to
a Participant's Accounts. In the event that this Plan is terminated, the amounts
allocated to a  Participant's  Accounts shall be distributed to the  Participant
or,  in the  event of his or her  death,  his or her  Beneficiary  in a lump sum
within thirty (30) days following the date of termination.


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<PAGE>


         6.5      GOVERNING LAW.

                  This  Plan shall  be construed,  governed and  administered in
accordance with the laws of the State of California.

         6.6      RECEIPT OR RELEASE.

                  Any payment to a Participant or the Participant's  Beneficiary
in accordance with the provisions of the Plan shall,  to the extent thereof,  be
in full  satisfaction  of all claims against the Committee and the Company.  The
Committee may require such Participant or Beneficiary,  as a condition precedent
to such payment,  to execute a receipt and release to such effect.

         6.7      PAYMENTS ON BEHALF OF PERSONS UNDER INCAPACITY.

                  In the event that any amount becomes payable under the Plan to
a person who, in the sole judgment of the Committee,  is considered by reason of
physical or mental condition to be unable to give a valid receipt therefore, the
Committee  may  direct  that such  payment  be made to any  person  found by the
Committee,  in its sole judgment,  to have assumed the care of such person.  Any
payment made pursuant to such determination  shall constitute a full release and
discharge  of the  Committee  and the  Company.

         6.8      LIMITATION OF RIGHTS AND EMPLOYMENT RELATIONSHIP

                  Neither  the  establishment  of the  Plan  and  Trust  nor any
modification  thereof,  nor the creating of any fund or account, nor the payment
of any benefits shall be construed as giving to any Participant,  or Beneficiary
or other person any legal or equitable  right against the Company or the trustee
of the Trust except as provided in the Plan and Trust; and in no event shall the
terms of employment of any Employee or  Participant be modified or in any way be
affected by the provisions of the Plan and Trust.

         6.9      HEADINGS.

                  Headings  and  subheadings  in  this  Plan  are  inserted  for
convenience of reference  only and are not to be considered in the  construction
of the provisions hereof.

                  IN WITNESS  WHEREOF,  the  Company  has caused this Plan to be
adopted on this 30th day of May, 2003, effective as of January 1, 1997.

                                        BRILLIANT DIGITAL ENTERTAINMENT, INC.

                                        By:   /S/ TYLER TARR
                                            -------------------------------
                                             Name: Tyler Tarr
                                             Title: Chief Financial Officer