SETTLEMENT AGREEMENT
                              --------------------
                            (SHAREHOLDERS AGREEMENT)
                            ------------------------


         SETTLEMENT AGREEMENT by and among Klaus Moeller, Michael Meader and
Gerald Edick (the "SHAREHOLDERS"), and American Public Media Group (formerly
known as Minnesota Communications Group), a Minnesota non-profit organization
("APMG") dated as of December 21, 2000.

         WHEREAS, the parties entered into a Shareholders Agreement dated as of
March 31, 1999 (the "SHAREHOLDERS AGREEMENT") in connection the acquisition by
APMG of shares in Genius Products, Inc. ("GPI"); and

         WHEREAS, the parties desire to cancel certain provisions of the
Shareholders Agreement, and for APMG to release the Shareholders with respect to
certain provisions under the Shareholders Agreement, from any known and unknown
actual and potential claims that exist or may exist arising out of or in
connection with the Shareholders Agreement; and

         NOW THEREFORE, in consideration of the mutual covenants provided
herein, and for other good and valuable consideration the sufficiency of which
is hereby acknowledged, the parties hereby agree as follows:

         1.       DEFINED TERMS: Capitalized terms shall have the meaning set
                  forth in the Shareholders Agreement unless otherwise defined.

         2.       CANCELLATION OF SECTION 1: APMG hereby agrees that the duties
                  and obligations of the Shareholders under Section 1 of the
                  Shareholders Agreement are hereby cancelled, and the Proxy
                  granted thereunder is hereby cancelled and deemed null and
                  void with immediate effect, and without the need for further
                  action on the part of any Shareholder, and APMG shall take
                  such action as may be reasonably necessary for the purpose of
                  giving effect to the cancellation of the Proxy.

         3.       CONTINUATION OF SECTIONS 2, 3 AND 4. Sections 2, 3 and 4 of
                  the Shareholders Agreement shall continue in full force and
                  effect. The parties acknowledge the right of the Shareholders
                  to sell shares owned by the shareholders in an open market
                  transaction pursuant to Paragraph 4(b)(ii) of the Shareholders
                  Agreement. of the Shareholders Agreement.

         4.       RELEASE AND DISCHARGE: APMG hereby releases and forever
                  discharges each Shareholder and GPI and its respective
                  subsidiaries and affiliates, and each of their respective
                  heirs, executors, administrators, successors, assigns, agents,
                  representatives, shareholders, directors, officers, and
                  employees, from any and all actions, claims, demands and suits
                  of whatever nature arising out of or connected directly or
                  indirectly with the rights, duties and obligations of the
                  Shareholders under Section 1 of the Shareholder Agreement (the
                  claims released being the "RELEASED Claims").

                  The release and discharge set forth in this Section 4 extends
                  to and includes all damages, injuries, losses, claims and
                  rights now existing as well as any that may develop in the
                  future, whether known or unknown, as related to the Released
                  Claims. With respect to the Released Claims, APMG expressly
                  waives and relinquishes any and all rights and benefits
                  conferred upon it by the provisions of Section 1542 of the
                  California Civil Code, which provides as follows:

                           "A general release does not extend to claims which
                           the creditor does not know or suspect to exist in his
                           favor at the time of executing the release, which if
                           known by him must have materially affected his
                           settlement with the debtor."



<PAGE>

                  The parties acknowledge that the waiver of Section 1542 of the
                  California Civil Code was separately bargained for, and they
                  agree that the this Agreement shall be given full force and
                  effect in accordance with the terms and provisions related to
                  unknown and unsuspected claims and damages as well as those
                  provisions related to known claims, demands, and causes of
                  action.

         5.       NO ADMISSION OF LIABILITY. With respect to the Released
                  Claims, the parties agree and acknowledge that the terms and
                  conditions of this Agreement constitute an accord and
                  satisfaction of contested matters and neither the offer nor
                  the acceptance of the terms and conditions hereto represent an
                  admission of liability, responsibility or wrongdoing on the
                  part of either party, and each party hereby expressly
                  disclaims any such liability, responsibility or wrongdoing.

         6.       GOVERNING LAW: This Agreement shall be construed in accordance
                  with and governed by the internal laws of the State of
                  California.

         7.       ENTIRE AGREEMENT. This Agreement embodies the entire agreement
                  and understanding among the parties with respect to the
                  subject matter hereof, and supercedes all prior agreements,
                  understandings and representations between the parties related
                  to the subject matter hereof.

         IN WITNESS WHEREOF, the parties have executed this Settlement Agreement
by their duly authorized officers as of the dated first above written.


         /S/  Klaus Moeller
         ----------------------
         KLAUS MOELLER


         /S/ Michael Meader
         ----------------------
         MICHAEL MEADER


         /S/ Gerald Edick
         ----------------------
         GERALD EDICK




         AMERICAN PUBLIC MEDIA GROUP


         /S/ Thomas J. Kigin
         ----------------------
         Thomas J. Kigin
         Executive Vice President

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