EXHIBIT 4.3

                             STOCK OPTION AGREEMENT

         AGREEMENT, made as of July 11, 1999 between OVERSEAS FILMGROUP, INC., a
Delaware corporation (the "Company"), and GARY STEIN (the "Optionee").

         WHEREAS, the Board of Directors of the Company has authorized the grant
to the Optionee of an option ("Option") to purchase 10,000 of the authorized but
unissued or treasury shares of the common stock of the Company, $.001 par value
("Common Stock"), on the terms and conditions set forth in this Agreement; and

         WHEREAS, the Optionee desires to acquire the Option on the terms and
conditions set forth in this Agreement.

         IT IS AGREED:

         1.     Grant of Stock Option. The Company hereby grants to the Optionee
the right and option to purchase all or any part of an aggregate of 10,000
shares of Common Stock ("Option Shares") on the terms and conditions set forth
herein. Said Option is a nonqualified stock option not intended to qualify under
any section of the Internal Revenue Code of 1986, as amended, and is not granted
under any plan, including the Company's 1996 Basic Stock Option Plan ("Plan").
Certain terms used herein, however, are defined under the Plan.

         2.     Exercise Price. The exercise price ("Exercise Price") of the
Option shall be $2.44 per share, subject to adjustment as hereinafter provided.

         3.     Exercisability. This Option is exercisable, subject to the terms
and conditions of this Agreement, at any time from and after the date of this
Agreement, and it shall remain exercisable, except as otherwise provided herein,
until the close of business on July 11, 2009 (the "Exercise Period").

         4.     Withholding Tax. Not later than the date as of which an amount
first must be included in the gross income of the Optionee for Federal income
tax purposes with respect to the Option, the Optionee may be required to pay to
the Company, or make arrangements satisfactory to the Company regarding the
payment of, any Federal, state and local taxes of any kind required by law to be
withheld or paid with respect to such amount ("Withholding Tax"). The
obligations of the Company pursuant to this Agreement shall be conditioned upon



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such payment or arrangements with the Company, if such payments or arrangements
are required, and the Company shall, to the extent permitted by law, have the
right to deduct any Withholding Taxes from any payment of any kind otherwise due
to the Optionee from the Company.

         5.      Adjustments. If and to the extent that the number of issued
shares of Common Stock shall be increased or reduced by reclassification, common
stock split, common stock dividend on the Common Stock, combination of shares,
or any similar change in the Common Stock of the Company as a whole, the Company
shall proportionally adjust the number and kind of Option Shares and the
exercise price of the Option, to such extent and in such manner as shall as
closely as possible maintain the Optionee's proportionate interest in the
Company and his rights hereunder. If (i) the Company shall not be the surviving
corporation in any merger, combination, consolidation or similar type of
corporate transaction or (ii) if the Company is the survivor, but the
outstanding shares of Common Stock are exchanged for securities of another
company, or property, then the Board of Directors will make appropriate
provision so that this Option will be exercisable for the full period as
provided in this Agreement for securities or other property of the surviving or
other entity as if this Option had been exercised for Common Stock immediately
before such merger, combination, consolidation or other transaction. No
fractional shares of Common Stock shall be issued as a result of any adjustment
under this provision, and to the extent any adjustment results in a fractional
share of Common Stock, then the adjustment will be to the lower full share.

         6.      Method of Exercise.

                 6.1     Notice to the Company. The Option shall be exercised in
whole or in part by written notice in the form attached hereto as Exhibit A
directed to the Company at its principal place of business accompanied by full
payment as hereinafter provided of the exercise price for the number of Option
Shares specified in the notice and of the Withholding Taxes, if any.

                 6.2     Delivery of Option Shares. The Company shall deliver a
certificate for the Option Shares to the Optionee as soon as practicable after
payment therefor.

                 6.3     Payment of Purchase Price.

                         6.3.1     Cash Payment. The Optionee shall make cash
payments by wire transfer, certified or bank check or personal check, in each
case payable to the order of the Company; the Company shall not be required to

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deliver certificates for Option Shares until the Company has confirmed the
receipt of good and available funds in payment of the purchase price thereof.

                        6.3.2      Cashless Payment. The Company, in its sole
discretion, may allow the Optionee to use Common Stock of the Company (or other
securities or promissory notes) owned by him (or to surrender a portion of this
Option) to pay the purchase price for the Option Shares (and any required
Withholding Taxes). Such payment would be made by delivery of certificates in
negotiable form, which are effective to transfer good and valid title thereto to
the Company, free of any liens or encumbrances. Shares of Common Stock used for
this purpose shall be valued at the Fair Market Value, as defined below. The
value of any Option surrendered shall equal the difference between the Exercise
Price and the Fair Market Value on the date of surrender multiplied by the
number of Option Shares underlying the portion of the Option surrendered.

                         6.3.3     Fair Market Value. "Fair Market Value,"
unless otherwise required by any applicable provision of the Internal Revenue
Code of 1986, as amended, or any regulations issued thereunder, means, as of any
given date: (i) if the Common Stock is listed on a national securities exchange
or quoted on the Nasdaq National Market or Nasdaq SmallCap Market, the last sale
price of the Common Stock in the principal trading market for the Common Stock
on the last trading day preceding the date of exercise, as reported by the
exchange or Nasdaq, as the case may be; (ii) if the Common Stock is not listed
on a national securities exchange or quoted on the Nasdaq National Market or
Nasdaq SmallCap Market, but is traded in the over-the-counter market, the
closing bid price for the Common Stock on the last trading day preceding the
date of exercise for which such quotations are reported by the OTC Bulletin
Board or the National Quotation Bureau, Incorporated or similar publisher of
such quotations; and (iii) if the Fair Market Value of the Common Stock cannot
be determined pursuant to clause (i) or (ii) above, such price as the Board of
Directors of the Company shall determine, in good faith.

         7.      Nonassignability. The Option shall not be assignable or
transferable, without the consent of the Company, except by will or by the laws
of descent and distribution in the event of the death of the Optionee. No
transfer of the Option by the Optionee by will or by the laws of descent and
distribution shall be effective to bind the Company unless the Company shall
have been furnished with written notice thereof and a copy of the will and/or
such other evidence as the Company may deem necessary to establish the validity
of the transfer and the acceptance by the transferee or transferees of the terms
and conditions of the Option.

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         8.      Company Representations. The Company hereby represents and
warrants to the Optionee that:

                         (1)     the Company, by appropriate and all required
action, is duly authorized to enter into this Agreement and consummate all of
the transactions contemplated hereunder; and

                         (2)     the Option Shares, when issued and delivered by
the Company to the Optionee in accordance with the terms and conditions hereof,
will be duly and validly issued and fully paid and non-assessable.

         9.      Optionee Representations. The Optionee hereby represents and
warrants to the Company that:

                         (1)     he is acquiring the Option and shall acquire
the Option Shares for his own account and not with a view towards the
distribution thereof;

                         (2)     he has received a copy of all reports and
documents required to be filed by the Company with the Securities and Exchange
Commission pursuant to the Securities Exchange Act of 1934, as amended, within
the last 24 months and all reports issued by the Company to its stockholders;

                         (3)     he understands that he must bear the economic
risk of the investment in the Option Shares, which cannot be sold by him unless
they are registered under the Securities Act of 1933 (the "Securities Act") or
an exemption therefrom is available thereunder and that, except as provided
herein, the Company is under no obligation to register the Option Shares for
sale under the Securities Act;

                         (4)     he has had both the opportunity to ask
questions and receive answers from the officers and directors of the Company and
all persons acting on its behalf concerning the terms and conditions of the
offer made hereunder and to obtain any additional information to the extent the
Company possesses or may possess such information or can acquire it without
unreasonable effort or expense necessary to verify the accuracy of the
information obtained pursuant to clause (ii) above;

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                         (5)     he is aware that the Company shall place stop
         transfer orders with its transfer agent against the transfer of the
         Option Shares in the absence of registration under the Securities Act
         or an exemption therefrom as provided herein; and

                         (6)     the certificates evidencing the Option Shares
shall bear the following legends:

                  "The shares represented by this certificate have been acquired
                  for investment and have not been registered under the
                  Securities Act of 1933. The shares may not be sold or
                  transferred in the absence of such registration or an
                  exemption therefrom under said Act."

                  "The shares represented by this certificate have been acquired
                  pursuant to a Stock Option Agreement, dated as of July 11,
                  1999, a copy of which is on file with the Company, and may not
                  be transferred, pledged or disposed of except in accordance
                  with the terms and conditions thereof."


         10.     Restriction on Transfer of Option Shares.

                 10.1     Anything in this Agreement to the contrary
notwithstanding, Optionee hereby agrees that he shall not sell, transfer by any
means or otherwise dispose of the Option Shares acquired by him without
registration under the Securities Act, or in the event that they are not so
registered, unless (i) an exemption from the Securities Act registration
requirements is available thereunder and (ii) Optionee has furnished the Company
with notice of such proposed transfer and the Company's legal counsel, in its
reasonable opinion, shall deem such proposed transfer to be so exempt.

                 10.2     Anything in this Agreement to the contrary
notwithstanding, the Optionee hereby agrees that, if he is, or at any time
hereinafter becomes, an employee or director of the Company or any subsidiary
thereof, he shall not sell, transfer by any means or otherwise dispose of the
Option Shares acquired by him except in accordance with Company's policy, if
any, regarding the sale and disposition of securities owned by employees and/or
directors of the Company.

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         11.     Miscellaneous.

                 11.1     Notices. All notices, requests, deliveries, payments,
demands and other communications which are required or permitted to be given
under this Agreement shall be in writing and shall be either delivered
personally, sent by confirmed facsimile, registered or certified mail, or by
private courier to the parties at their respective addresses set forth herein,
or to such other address as either shall have specified by notice in writing to
the other. Notice shall be deemed duly given hereunder when delivered, faxed or
mailed as provided herein.

                 11.2     Optionee and Stockholder Rights. The Optionee shall
not have any of the rights of a stockholder with respect to the Option Shares
until such shares have been issued after the due exercise of the Option. If
Optionee is, or hereinafter becomes, an employee or director of the Company or
any subsidiary thereof, nothing contained in this Agreement shall be deemed to
confer upon the Optionee any right to continued employment, or a continued
directorship position, with the Company or any subsidiary thereof, nor shall it
interfere in any way with the right of the Company to terminate the Optionee in
accordance with the provisions regarding such termination set forth in
Optionee's written employment agreement with the Company, or if there exists no
such agreement, to terminate Optionee at will, and/or terminate Optionee's
directorship in accordance with the Company's Certificate of Incorporation and
By-laws and/or the laws of the State of Delaware, as the case may be.

                 11.3     Waiver. The waiver by any party hereto of a breach of
any provision of this Agreement shall not operate or be construed as a waiver of
any other or subsequent breach.

                 11.4     Entire Agreement. This Agreement constitutes the
entire agreement between the parties with respect to the subject matter hereof.
This Agreement may not be amended except by writing executed by Optionee and the
Company.

                 11.5     Binding Effect; Successors. This Agreement shall inure
to the benefit of and be binding upon the parties hereto and, to the extent not
prohibited herein, their respective heirs, successors, assigns and
representatives. Nothing in this Agreement, expressed or implied, is intended to
confer on any person other than the parties hereto and as provided above, their
respective heirs, successors, assigns and representatives any rights, remedies,
obligations or liabilities.


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                 11.6     Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware (without regard
to choice of law provisions).

                 11.7     Headings. The headings contained herein are for the
sole purpose of convenience of reference, and shall not in any way limit or
affect the meaning or interpretation of any of the terms or provisions of this
Agreement.

         IN WITNESS WHEREOF, the parties hereto have signed this Agreement as of
the day and year first above written.

OVERSEAS FILMGROUP, INC.

                                                Address:
                                                8800 Sunset Boulevard
                                                Los Angeles, California  90069
                                                Fax:  (310) 855-0719

By: /s/ William F. Lischak
   -------------------------------
        William F. Lischak



OPTIONEE:
                                                Address:
                                                ______________________________
                                                ______________________________
  /s/ Gary Stein                                Fax:________________________
----------------------------------
         GARY STEIN

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                                                                      EXHIBIT A

                      FORM OF NOTICE OF EXERCISE OF OPTION

--------------------
       DATE

Overseas Filmgroup, Inc.
8800 Sunset Boulevard
Los Angeles, California  90069

Attention:  The Board of Directors

                           Re:      Purchase of Option Shares

Gentlemen:

         In accordance with my Stock Option Agreement dated as of July 11, 1999
with Overseas Filmgroup, Inc. (the "Company"), I hereby irrevocably elect to
exercise the right to purchase _________ shares of the Company's common stock,
par value $.001 per share ("Common Stock").

         As payment for my shares, enclosed is (check and complete applicable
box[es]):

         |_|     a [personal check] [certified check] [bank check] payable to
                 the order of "Overseas Filmgroup, Inc." in the sum of
                 $_________;

         |_|     confirmation of wire transfer in the amount of $_____________;
                 and/or

         |_|     with the consent of the Company, a certificate for _________
                 shares of the Company's Common Stock, free and clear of any
                 encumbrances, duly endorsed, having a Fair Market Value (as
                 such term is defined in Section 6.3.3 of the Stock Option
                 Agreement) of $_________.

         |_|     with the consent of the Company, by surrender of a portion of
                 my Option having a value of $_____________ as calculated in
                 accordance with Section 6.3.2 of the Stock Option Agreement.

         |_|     with the consent of the Company, ___________________________
                 ____________________________________________________________
                 ____________________________________________________________

         I hereby represent and warrant to, and agree with, the Company that:

                 (i)    I have acquired the Option and shall acquire the Option
Shares for my own account, for investment, and not with a view towards the
distribution thereof;

                 (ii)   I have received a copy of all reports and documents
required to be filed by the Company with the Commission pursuant to the Exchange
Act within the last 24 months and all reports issued by the Company to its
stockholders;

                 (iii)  I understand that I must bear the economic risk of the
investment in the Option Shares, which cannot be sold by me unless they are
registered under the Securities Act of 1933 (the "Securities Act") or an
exemption therefrom is available thereunder;

                 (iv)   I have had both the opportunity to ask questions and
receive answers from the officers and directors of the Company and all persons
acting on its behalf concerning the terms and conditions of the offer made
hereunder and to obtain any additional information to the extent the Company
possesses or may possess such information or can acquire it without unreasonable
effort or expense necessary to verify the accuracy of the information obtained
pursuant to clause (ii) above;

                 (v)    I am aware that the Company shall place stop transfer
orders with its transfer agent against the transfer of the Option Shares in the
absence of registration under the Securities Act or an exemption therefrom as
provided herein; and

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                (vi)   the certificates evidencing the Option Shares shall bear
the following legends:

                           "The shares represented by this certificate have been
                           acquired for investment and have not been registered
                           under the Securities Act of 1933. The shares may not
                           be sold or transferred in the absence of such
                           registration or an exemption therefrom under said
                           Act."

                           "The shares represented by this certificate have been
                           acquired pursuant to a Stock Option Agreement, dated
                           as of July 11, 1999, a copy of which is on file with
                           the Company, and may not be transferred, pledged or
                           disposed of except in accordance with the terms and
                           conditions thereof."


Kindly forward to me my certificate at your earliest convenience.

Very truly yours,

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(Signature)                          (Address)

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(Print Name)
                                     ----------------------------------------
                                     (Social Security Number)









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