Document:

GENIUS PRODUCTS, INC.
                              ---------------------

                                    EXECUTIVE
                                    ---------
                              EMPLOYMENT AGREEMENT
                              --------------------

EMPLOYMENT AGREEMENT between Genius Products, Inc., a Nevada corporation (the
"COMPANY") and Alison Elliott, ("EXECUTIVE") dated as of February 1, 2000 (the
"EFFECTIVE DATE").

WHEREAS, the Company wishes to employ Executive and Executive wishes to be
employed by the Company , all on the terms and conditions set forth herein;

NOW THEREFORE, in consideration of the mutual covenants set forth below and for
other good and valuable consideration, the adequacy and sufficiency is hereby
acknowledged, the parties agree as follows:

1)       POSITION AND TERM:

         a)       The Company hereby employs Executive for one (1) year from the
                  Effective Date (the "TERM") as Treasurer and Controller and
                  perform such other duties consistent with Executive's office
                  as may be directed by the Board of Directors, CEO, President
                  or Executive Vice President.

         b)       As an officer of the Company Executive may contractually bind
                  the Company subject to prior written authorization from the
                  CEO, President, CFO, Executive Vice President or Board of
                  Directors.

2)       EXECUTIVE TO DEVOTE FULL TIME TO COMPANY. Executive shall devote full
         time, attention, and energies to the business of the Company , and,
         during this employment, will not engage in any other business activity,
         regardless of whether such activity is pursued for profit, gain, or
         other pecuniary advantage. Executive is not prohibited from making
         personal investments in any other businesses provided those investments
         do not require active involvement in the operation of said companies.

3)       COMPENSATION AND BENEFITS: The Company shall pay, provide and grant to
         Executive the following salary and benefits:

         a)       ANNUAL SALARY: $96,000

         b)       GRANT OF OPTIONS: A grant of options as provided in the
                  Non-Qualified Stock Option Agreement attached hereto as
                  EXHIBIT A and subject to the terms and conditions of the
                  Company 's Non-Qualified Stock Option Plan attached hereto as
                  EXHIBIT B.

         c)       MEDICAL AND OTHER BENEFITS: As determined by the Board in its
                  sole discretion, PROVIDED that all benefits are on terms no
                  less favorable than those provided to all other executives,
                  including senior executives, of the Company , including, to
                  the extent applicable:

                  i)       Medical and health insurance for Executive and
                           dependants;

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<PAGE>

                  ii)      Medical expense reimbursement plan;

                  iii)     Retirement, pension and 401(k) plans; and

                  iv)      Life, disability and key-man insurance.

         d)       VACATION: Three (3) weeks per year, any unused days of which
                  may be rolled-over into following year; and three (3) personal
                  days.

         e)       OTHER BENEFITS/ REIMBURSEMENT: Reimbursement of reasonable
                  out-of-pocket expenses incurred on Company business and
                  pre-approved in writing by the CEO, President, or CFO of the
                  Company .

4)       DEATH BENEFITS. Should Executive die during the term of employment, the
         Company shall pay to Executive's estate any compensation and other
         benefits due through the end of the month in which death occurred.

5)       TERMINATION.

         a)       TERMINATION BY COMPANY WITHOUT CAUSE; TERMINATION BY EXECUTIVE
                  FOR GOOD REASON

                  i)       Notwithstanding anything to the contrary herein and
                           subject to applicable law, the Company may terminate
                           this Agreement without cause at any time upon thirty
                           (30) days' prior written notice to Executive.

                  ii)      Notwithstanding anything to the contrary herein,
                           Executive may terminate this Agreement for Good
                           Reason at any time upon thirty (30) days' prior
                           written notice to the Company . "GOOD REASON" means:

                           (1)      the assignment to Executive of any duties
                                    inconsistent with his duties described in
                                    Section 1) above or any removal of Executive
                                    from or any failure to re-elect Executive to
                                    his office and position described in Section
                                    1) above, except in connection with
                                    promotions to higher office;

                           (2)      the failure by the Company to maintain and
                                    to continue Executive's participation in the
                                    Company 's benefit or compensation plans as
                                    in effect immediately prior to the Change in
                                    Control (including but not limited to bonus
                                    and incentive compensation plans, stock
                                    option, bonus, award and purchase plans,
                                    life insurance, medical, health and
                                    accident, and disability plans);

                           (3)      the taking of any action by the Company
                                    which would adversely affect Executive's
                                    participation in or reduce Executive's
                                    benefits under any of the Company 's benefit
                                    or compensation plans (including but not
                                    limited to bonus and incentive compensation
                                    plans, stock option, bonus, award and
                                    purchase plans, life insurance, medical,
                                    health and accident, and disability plans);

                           (4)      the failure by the Company to obtain the
                                    assumption of this Agreement by any
                                    successor as required under Section 12) c)
                                    below.

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<PAGE>

                  iii)     If Executive is terminated without cause or resigns
                           for Good Reason, the Company shall continue to
                           provide the compensation and benefits set forth in
                           Section 3) for the remainder of the Term, except that
                           medical and health insurance benefits shall only be
                           provided until the earlier of (1) the end of the Term
                           and (2) the date on which Executive and his
                           dependants are fully covered under the medical
                           insurance plan of a new employer.

         b)       TERMINATION BY EXECUTIVE. Executive may terminate this
                  Agreement upon thirty (30) days' prior written notice to the
                  Company . Executive may at his election and subject to the
                  Company 's consent, perform his duties through to the
                  termination date and the Company shall continue to pay and
                  provide Executive with all of the compensation and benefits
                  set forth in Section 2) through to the termination date, but
                  Executive shall not receive any severance allowance.

         c)       TERMINATION BY COMPANY FOR CAUSE. Notwithstanding anything to
                  the contrary contained herein and subject to applicable law,
                  the Company may terminate the Executive's employment with
                  immediate effect if the Board of Directors shall determine in
                  good faith that any of the following has occurred: (i) acts or
                  omissions by the Executive which constitute material
                  misconduct or a knowing violation of a material written policy
                  of the Company or any of its subsidiaries (provided Executive
                  has been provided with a copy of such material written
                  policy), (ii) the Executive or any affiliated or related
                  person or entity receiving a benefit in money, property or
                  services from the Company or any of its subsidiaries or from
                  another person dealing with the Company or any of its
                  subsidiaries, in material violation of applicable law or
                  Company policy, (iii) an act of fraud, conversion,
                  misappropriation, or embezzlement by the Executive or his
                  conviction of, or entering a guilty plea or plea of no contest
                  with respect to, a felony, or the equivalent thereof, (iv) a
                  material breach by the Executive of any provision of Section 8
                  hereof, (v) the Executive's failure or refusal (whether
                  intentional, reckless or negligent) to perform his duties
                  under this Agreement or (vi) any other breach by the Executive
                  of this Agreement in any material respect. In no event shall
                  the Executive's termination by the Company be considered to
                  have been for cause if such termination took place as a result
                  of (1) the Executive's bad judgment or negligence or (2) any
                  act or omission without intent of gaining a profit to which
                  the Executive was not legally entitled or (3) any act or
                  omission believed by the Executive in good faith to have been
                  in, or not opposed to, the interests of the Company . If
                  Executive is terminated for cause, he shall be entitled to the
                  compensation and other benefits set forth in Section 2)
                  through the last date of Executive's employment. Upon payment
                  of all obligations under this Agreement that are then
                  outstanding, this Agreement shall terminate. Notice of such
                  termination shall be given to Executive in writing, specifying
                  the reasons for such termination.

6)       SEVERANCE UPON CHANGE IN CONTROL: As of the effective date of a Change
         of Control as defined in the Employment Agreement set forth in EXHIBIT
         C hereto, the Company and Executive shall enter into, and shall be
         deemed to have entered into, an Employment Agreement substantially
         identical to the agreement set forth in EXHIBIT C, unless such
         Employment Agreement has been terminated as provided therein.

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<PAGE>

7)       PROPRIETARY AND CONFIDENTIAL INFORMATION:

         a)       All information, data, materials, computer code, intellectual
                  property rights, customer lists, discoveries, inventions or
                  processes or improvement in procedures or made or discovered
                  by Executive during the term of this Agreement in connection
                  with or in any way affecting or relating to the business of
                  the Company or capable of being used or adapted for use
                  therein or in connection therewith is and shall forthwith be
                  deemed to be "CONFIDENTIAL INFORMATION" and shall be disclosed
                  to the Company and shall belong to and be the absolute
                  property of the Company .

         b)       Executive shall, if and when required so to do, whether during
                  or after the termination of this Agreement, at Employer's
                  expense apply or join in applying for any patent or trademark
                  registration or other similar protection in the United States
                  or in any other part of the world for any such discovery,
                  invention, process or improvement and shall execute all
                  instruments and do all things necessary to register the
                  patent, trademark or other similar protection when obtained
                  and all right and title to an interest in the same in the
                  Company absolutely and as sole beneficial owner.

         c)       Executive shall not at any time either during the term of this
                  Agreement or any extension thereof or after the termination of
                  the employment for any reason (i) divulge any Confidential
                  Information or other affairs or secrets of the Company to any
                  other company, person or persons without the previous consent
                  in writing of the Company or (ii) use or attempt to use any
                  information which Executive may acquire in the course of the
                  employment in any manner which may injure or cause loss or be
                  calculated to injure or cause loss to the Company .

         d)       Upon the termination of this Agreement for any reason,
                  Executive shall resign without claim for compensation from as
                  a director (if applicable) of the Company and from all offices
                  held by Executive in the Company , and in the event of
                  Executive failing to do so the Company is hereby irrevocably
                  authorized to appoint some person in Executive's name and on
                  Executive's behalf to execute any documents and to do all
                  things required to give effect to the provisions of this
                  Section.

         e)       Upon the termination of this Agreement for any reason,
                  Executive shall deliver to the Company all documents used by
                  Executive in the course of the Company 's business, including
                  but without limiting the foregoing, all price lists, mailing
                  lists, customer, client or supplier lists, sales information,
                  catalogues, diaries, log books, computer software and computer
                  data.

         f)       Should Executive reveal or threaten to reveal any Confidential
                  Information, the Company shall be entitled to an injunction
                  restraining the Executive from disclosing same, or from
                  rendering any services to any entity to whom such information
                  has been or is threatened to be disclosed. The right to secure
                  an injunction is not exclusive, and the Company may pursue any
                  other remedies it has against the Executive for a breach or
                  threatened breach of this provision, including the recovery of
                  damages from the Executive.

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<PAGE>

8)       RESTRICTIVE COVENANT: Executive expressly agrees that it shall not at
         any time for one (1) year after the termination of the employment (i)
         undertake or carry on or be employed or directly or indirectly be
         concerned or interested either as employer, Executive, consultant,
         director or shareholder or (ii) for one (1) year after the termination
         of the employment attempt in any way whatsoever to obtain customers or
         clients of the Company , in either case in or for any enterprise,
         person, firm or company, the principal business of which involves (A)
         the production or development or the retail or wholesale selling or
         distribution of goods and services that are substantially similar to or
         in competition with those sold or provided by the Company or (B) the
         sale of memberships in member programs the benefits of which include
         the sale or provision of such goods or services. Executive further
         agrees during and after the termination of the employment for any
         reason, whether for Executive's own account or for any other person or
         for any firm or company not to solicit, interfere with or endeavor to
         entice away from the Company any employee of the Company or any person,
         firm or company who at any time during the continuance of the
         employment shall have been a customer or client of the Company .

9)       INDEMNITY: Executive shall defend, save and hold harmless the Company
         from and against any claims, damages, actions, proceedings or other
         losses incurred or suffered by the Company arising out of a material
         breach by Executive of the confidentiality provisions herein.

10)      GOVERNING LAW; JURISDICTION; VENUE. The Agreement will be interpreted,
         construed and enforced in all respects in accordance with the laws of
         the State of California, without regard to its conflicts of laws
         principles. Each party hereby irrevocably consents to the exclusive
         jurisdiction of the state and federal courts San Diego County of the
         State of California in connection with any action arising under this
         Agreement and waives all defenses regarding the inconvenience of such
         forum. THE PARTIES IRREVOCABLY WAIVE THEIR RIGHTS TO A TRIAL BY JURY IN
         CONNECTION WITH ANY CLAIM, COUNTERCLAIM OR OTHER PROCEEDINGS ARISING
         UNDER OR IN CONNECTION WITH THIS AGREEMENT.

11)      MISCELLANEOUS.

         a)       INTEGRATION. This Agreement is the sole contract governing the
                  relationship between the Company or any predecessor of the
                  Company and Executive, and supersedes any and all prior
                  agreements, letters of intent, correspondence, negotiations,
                  discussions or understandings between the Company or any
                  predecessor of the Company and the Executive.

         b)       SEVERABILITY. If any provision of the Agreement is held
                  invalid by a court with jurisdiction over the parties to the
                  Agreement, (i) such provision will be deemed to be restated to
                  reflect as nearly as possible the original intentions of the
                  parties in accordance with applicable law and (ii) the
                  remaining terms, provisions, covenants and restrictions of
                  this Agreement will remain in full force and effect. If this
                  Agreement is held invalid or cannot be enforced, then to the
                  full extent permitted by law any prior agreement between the
                  Company (or any predecessor thereof) and the Executive shall
                  be deemed reinstated as if this Agreement had not been
                  executed.

         c)       SUCCESSORS. The Company 's rights and obligations under this
                  Agreement will inure to the benefit and be binding upon the
                  Company 's successors and assignees.

         d)       AMENDMENTS. This Agreement may be altered only by a written
                  agreement signed by the party against whom enforcement of any
                  waiver, change, modification, extension, or discharge is
                  sought.

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<PAGE>

         e)       NOTICES. Any notice, approval, request, authorization,
                  direction or other communication under this Agreement will be
                  given in writing and will be deemed to have been delivered and
                  given for all purposes (i) on the delivery date if delivered
                  personally to the party to whom the same is directed; (iii)
                  one business day after deposit with a commercial overnight
                  carrier, with written verification of receipt; or (iii) five
                  business days after the mailing date, whether or not actually
                  received, if sent by U.S. mail, return receipt requested,
                  postage and charges prepaid, or any other means of rapid mail
                  delivery for which a receipt is available. All notices to the
                  Company will be effective if delivered to THE COMPANY
                  Corporation, 11250 El Camino Real, Suite 100, San Diego, CA
                  92130, attention: President, or such other address specified
                  by the Company in writing. All notices to Executive will be
                  effective if delivered to Executive's last residential address
                  provided to the Company by Executive.

         f)       ASSIGNMENTS. The Company will not assign this Agreement or any
                  right, interest or benefit under this Agreement without the
                  prior written consent of Executive.

         g)       REMEDIES. Except where otherwise specified herein, the rights
                  and remedies granted to a party under the Agreement are
                  cumulative and in addition to, and not in lieu of, any other
                  rights or remedies which the Party may possess at law or in
                  equity.

         h)       LIMITED EFFECT OF WAIVER BY COMPANY. Should Company waive
                  breach of any provision of this Agreement by the Executive,
                  such waiver will not operate or be construed as a waiver of
                  further breach by the Executive.

         i)       COUNTERPARTS. The Agreement may be executed in counterparts,
                  each of which will be deemed an original and all of which
                  together will constitute one and the same document.

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<PAGE>

IN WITNESS WHEREOF, parties have signed this Employment Agreement as of the date
first above written.

GENIUS PRODUCTS, INC.

By:      /S/ Klaus Moeller
         --------------------------

Name:    Klaus Moeller
         Chief Executive Officer

EXECUTIVE

By:      /S/ Alison Elliott
         --------------------------

Name:    Alison ElliottCHANGE OF CONTROL
                                -----------------
                         EXECUTIVE EMPLOYMENT AGREEMENT
                         ------------------------------

         THIS EMPLOYMENT AGREEMENT (the "AGREEMENT") is made and entered into as
of February 1, 2000 between Genius Products, Inc., a Nevada corporation (the
"COMPANY"), and Alison Elliott (the "EXECUTIVE").

                              STATEMENT OF PURPOSE
                              --------------------

         The Company considers sound and vital management to be essential to
protecting and enhancing the best interests of the Company and its stockholders.
Although the Company knows of no change in control of the Company which is being
contemplated, the Company recognizes that a future change in control is always
possible and this possibility creates uncertainty and insecurity among members
of management. The Company believes that appropriate measures should be taken to
reinforce the dedication of key members of management and to provide them with a
greater sense of security so that they will be encouraged to remain in the
employ of the Company. The Company also believes that it is in the best
interests of the Company and its stockholders that appropriate measures be taken
to assure the neutrality of management in analyzing a potential change in
control and the options available to the Company and to preserve continuity in
corporate management and operations in the event of a change in control.

         NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the Company and the Executive hereby agree as follows:

      1. OPERATION OF AGREEMENT.

         (a) This Agreement shall be effective upon its execution, but anything
in this Agreement to the contrary notwithstanding, neither this Agreement nor
any of its provisions, except its renewal provision, shall be operative unless
and until there has been a Change in Control of the Company, as defined in
Subsection 1(c) below and subject to the provisions of Subsection 1(d) below
(regarding action by a majority of the Incumbent Board to modify or terminate
this Agreement up to 30 days following a Change in Control).

          (b) If no Change in Control of the Company has occurred on or before
the close of business on December 31, 2001, this Agreement shall thereupon
expire; PROVIDED, HOWEVER, the parties by their written mutual assent may extend
such date on which this Agreement shall expire.

          (c) A "CHANGE IN CONTROL" shall be deemed to have occurred if any of
the following events shall have occurred:

               (i)  any corporation, other person or "GROUP" (as defined below)
                    becomes the "BENEFICIAL OWNER" (as defined below) of more
                    than 15% of the Company's outstanding Common Stock; or

               (ii) the Company's outstanding Common Stock (x) is held of record
                    by less than 300 persons or (y) is neither listed on a
                    national securities exchange nor authorized to be quoted on
                    an inter-dealer quotation system of a registered national
                    securities association.
<PAGE>

         For purposes of this definition of Change in Control, the following
terms shall have the following meanings:

                  "BENEFICIAL OWNER" shall have the meaning which that term is
                  given in Rule 13d-3 under the Securities Exchange Act of 1934,
                  as amended (the "ACT").

                  "GROUP" shall mean persons who act in concert as described in
                  Section 14(d)(2) of the Act.

          (d) Notwithstanding any provision of this Agreement to the contrary,
at any time up to thirty (30) days following the date of a Change in Control,
the Board of Directors may, in its sole and exclusive discretion with approval
of at least a majority of the Incumbent Board (as defined below), terminate this
Agreement or make any modifications to the terms and provisions of this
Agreement (including without limitation causing the Agreement not to apply with
respect to the given Change in Control or reducing the amount of benefits
described herein) without the consent of Executive. For purposes hereof,
"INCUMBENT BOARD" shall mean the group of individuals who, as of the date of
this Agreement, constitute the Board of Directors of the Company; PROVIDED,
HOWEVER, that any individual who becomes a director subsequent to the date of
this Agreement and whose election, or whose nomination for election by the
Company's shareholders, to the Board of Directors was either (i) approved by a
vote of at least a majority of the directors then comprising the Incumbent Board
or (ii) recommended by a nominating committee comprised entirely of directors
who are then Incumbent Board members, shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of either an actual or threatened election contest (as such terms are
used in Rule 14a-11 of Regulation 14A promulgated under the Act), other actual
or threatened solicitation of proxies or consents or an actual or threatened
tender offer.

       2. EMPLOYMENT; PERIOD OF EMPLOYMENT.

          (a) The Company agrees to continue the Executive in its employ, and
the Executive hereby agrees to remain in the employ of the Company, for the
period set forth in Subsection 2(b) below (the "PERIOD OF Employment") in the
position and with the duties and responsibilities set forth in any Employment
Agreement in effect on the date of any Change in Control and Section 3 below,
subject to the other terms and conditions of this Agreement. If there is any
conflict between any terms of any such Employment Agreement and any terms
hereof, the terms of this Agreement shall prevail.

          (b) The Period of Employment shall commence on the date of any Change
in Control and, subject only to the Executive's death or termination of
employment by the Company for "CAUSE" or "DISABILITY" or by the Executive for
"GOOD REASON" (as defined in Section 4), shall continue until the close of
business on the later of (i) that date two years after the date on which the
Change in Control occurred or (ii) the expiration date under Subsection 1(b),
taking into account any extensions of such expiration date.

       3. POSITION, DUTIES, AND RESPONSIBILITIES.

          (a) During the Period of Employment, the Executive shall continue to
serve as an officer of the Company, either (i) with substantially the same
offices, titles, duties and responsibilities as the Executive had immediately
prior to the Change in Control or (ii) with a higher office with titles, duties
and responsibilities commensurate with such higher office.

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<PAGE>

         (b) During the Period of Employment, the Executive shall devote his
full-time efforts during normal business hours to the business and affairs of
the Company, except reasonable vacation periods and periods of illness or
incapacity, but nothing in this Agreement shall preclude the Executive from
devoting reasonable time to serving as a director or member of a committee of
one or more organizations (business, charitable, civic, religious or otherwise)
involving no conflict with the interests of the Company.

      4. TERMINATION FOLLOWING CHANGE IN CONTROL. If, after a Change in
Control of the Company has occurred, the Company shall terminate the Executive's
employment other than because of his death or for Disability or Cause or if the
Executive shall terminate his employment for Good Reason, the Executive shall be
entitled to all of the benefits and payments provided in Section 5 below,
subject to the provisions of Subsection 1(d) above.

         (a) DISABILITY. Termination based on "DISABILITY" shall mean
termination because of the Executive's absence due to physical or mental illness
from his duties with the Company on a full-time basis for 150 consecutive
business days unless within 30 days after Notice of Termination (as defined in
Subsection 4(d) below) is given following such absence, the Executive shall
return to the full-time performance of his duties.

          (b) CAUSE. Termination shall be deemed to have been for "CAUSE" only
if termination shall have been the result of an act or acts of dishonesty on the
part of the Executive constituting a felony and resulting or intended to result
in substantial gain or personal enrichment at the expense of the Company, or if
there has been a willful and substantial breach by the Executive of the
provisions of Subsection 3(b) above, and such breach has caused substantial
injury to the Company. In no event shall the Executive's termination by the
Company be considered to have been for Cause if such termination took place as a
result of (i) the Executive's bad judgment or negligence or (ii) any act or
omission without intent of gaining a profit to which the Executive was not
legally entitled or (iii) any act or omission believed by the Executive in good
faith to have been in, or not opposed to, the interests of the Company.

          (c) GOOD REASON.  "GOOD REASON" shall mean

               (i)  the assignment to the Executive of any duties inconsistent
                    with his duties described in Subsection 3(a) above or any
                    removal of the Executive from or any failure to re-elect the
                    Executive to his positions described in Subsection 3(a)
                    above, except in connection with promotions to higher
                    office;

               (ii) a reduction by the Company in the Executive's base salary as
                    in effect immediately prior to the Change in Control;

               (iii) the failure by the Company to maintain and to continue the
                    Executive's participation in the Company's benefit or
                    compensation plans as in effect immediately prior to the
                    Change in Control (including but not limited to bonus and
                    incentive compensation plans, stock option, bonus, award and
                    purchase plans, life insurance, medical, health and
                    accident, and disability plans); or the taking of any action
                    by the Company which would adversely affect the Executive's
                    participation in or reduce the Executive's benefits under
                    any of such plans or deprive the Executive of any fringe
                    benefit he enjoyed immediately prior to the Change in
                    Control; or the failure to provide the Executive with the
                    number of paid vacation days to which he was entitled under
                    the Company's normal vacation policy in effect immediately
                    prior to the Change in Control;

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<PAGE>

               (iv) the relocation of the Executive's office to anywhere other
                    than a location within 100 miles of Del Mar, California or
                    the Company's requiring the Executive to be based anywhere
                    other than within 100 miles of Del Mar, California (or such
                    other location as shall be the location of the Executive's
                    office immediately prior to the Change in Control) except
                    for required travel on the Company's business to an extent
                    consistent with the Executive's business travel obligations
                    immediately prior to the Change in Control; or

               (v)  the failure by the Company to obtain the assumption of this
                    Agreement by any successor as contemplated in Section 7
                    below.

          (d) Any termination of the Executive's employment, unless because of
death, shall be communicated by written Notice of Termination to the other
party. In the event of termination of employment by the Company for Cause or
Disability or by the Executive for Good Reason, the Notice of Termination shall
state the specific ground for termination (Cause, Disability or Good Reason) and
set forth in reasonable detail the facts and circumstances claimed to provide a
basis for the specified ground of termination.

          (e) "TERMINATION DATE" shall mean (i) if the Executive's employment is
terminated due to death, the Executive's date of death, (ii) if the Executive's
employment is terminated for Disability, thirty (30) days after Notice of
Termination is given (provided that the Executive shall not have returned to the
performance of his duties on a full-time basis during such thirty day period),
(iii) if the Executive's employment is terminated for Cause, the date specified
in the Notice of Termination, and (iv) if the Executive's employment is
terminated for any other reason, the date on which a Notice of Termination is
given.

       5. BENEFITS.

         (a) If the Company shall terminate the Executive's employment other
than because of his death or for Disability or Cause, or if the Executive shall
terminate his employment for Good Reason, then the Company shall pay to the
Executive and provide him, his dependents, beneficiaries and estate, with the
following;

               (i)  The Company shall pay the Executive his full base salary
                    through the Termination Date at the higher of the rate in
                    effect when Notice of Termination is given or the rate in
                    effect one year prior to such date, plus credit for any
                    vacation earned but not taken. The Executive's full base
                    salary shall be paid at the times normally scheduled for
                    payment of the salaries of key members of management;
                    PROVIDED, HOWEVER, that all of such salary shall be paid not
                    later than Termination Date.

               (ii) Subject to clause (iii) below, the Company shall pay the
                    Executive a lump sum payment equal to ten (10) times the
                    highest annual compensation (including base salary,
                    incentive compensation and monetary bonus or similar award)
                    paid or payable to the Executive by the Company for any of
                    the three fiscal years ended immediately prior to the
                    Termination Date. The Company shall gross-up the lump sum
                    payment such that the amount of the payment is net of all
                    federal, state, local, excise and other taxes and
                    withholdings, including without limitation, any "golden
                    parachute" taxes payable by the Executive. This lump sum
                    payment shall be due and payable on the 10th business day
                    after the Termination Date and bear interest from the
                    Termination Date until paid at then current prime rate of
                    interest published by Citibank, N.A.

                                       4
<PAGE>

               (iii) The Company shall pay all legal fees and expenses which the
                    Executive may incur as a result of the Company's contesting
                    the validity or enforceability of this Agreement, or as a
                    result of the Company's failure to make timely payment of
                    any sum due to the Executive hereunder.

          (b) The Executive shall not be required to mitigate the benefits or
amounts of any payment provided for in this Section 5 by seeking other
employment or otherwise, nor shall the amount of any payment provided for in
this Section 5 be reduced by any compensation earned by the Executive as a
result of employment by another employer after the Date of Termination, or
otherwise.

       6. OPTIONS. Subject to the provisions of Subsection 1(d) above, all of
the Executive's outstanding stock options shall become exercisable in full on
the date of a Change in Control of the Company, whether or not the stock options
were exercisable on such date.

       7. SUCCESSORS; BINDING AGREEMENT.

          (a) The Company shall require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business or assets of the Company, by agreement in form
and substance satisfactory to the Executive, expressly to assume and agree to
perform this Agreement in the same manner and to the same extent that the
Company would be required to perform if no such succession had taken place. As
used in this Agreement, "COMPANY" shall mean the company as defined in the
preamble to this Agreement and any successor to its business or assets which
executes and delivers the agreement provided for in this Paragraph 7 or which
otherwise becomes bound by all the terms and provisions of this Agreement by
operation of law.

          (b) This Agreement shall inure to the benefit of and be enforceable by
the Executive's personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees.

      8. NOTICES.

         For the purposes of this Agreement, notices and all other
communications provided for herein shall be in writing and shall be deemed to
have been duly given when delivered or mailed by United Stated registered or
certified mail, return receipt requested, postage prepaid. All notices to the
Company will be effective if delivered to ITM Corporation, 1250 El Camino Real,
Suite 100, San Diego, CA 92130, attention: Chief Executive Officer. All notices
to Executive will be effective if delivered to Executive's last residential
address provided to the Company by Executive, or to such other address as any
party may have furnished to the other in writing in accordance herewith, except
that notices of change of address shall be effective only upon receipt.

       9. GOVERNING LAW. The validity, interpretation, construction and
performance of this Agreement shall be governed by the internal laws of the
State of California.

       10. MISCELLANEOUS. No provisions of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing signed by the Executive and the Company. No waiver by either party of
any breach of this Agreement shall be deemed a waiver of any prior or subsequent
breach. No agreements or representations, oral or otherwise, with respect to the
subject matter hereof have been made by either party which are not set forth
expressly in this Agreement.

       11. SEPARABILITY. The invalidity or unenforceability of any provisions of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.

                                       5
<PAGE>

       12. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same Agreement.

       13. WITHHOLDING OF TAXES. The Company may withhold from any benefits
payable under this Agreement all federal, state, city or other taxes as shall be
required pursuant to any law or governmental regulation or ruling.

         14. NON-ASSIGNABILITY. This Agreement is personal in nature and neither
of the parties hereto shall, without the consent of the other, assign or
transfer this Agreement or any rights or obligations hereunder, except as
provided in Section 7 above. Without limiting the foregoing, the Executive's
right to receive payments hereunder shall not be assignable or transferable,
whether by pledge, creation of a security interest or otherwise, other than a
transfer by his will or by the laws of descent or distribution, and in the event
of any attempted assignment or transfer contrary to this paragraph, the Company
shall have no liability to pay any amount so attempted to be assigned or
transferred.

       15. ARBITRATION; FEES.

          (a) Any disputes between the Company and the Executive concerning this
Agreement will be settled by arbitration in accordance with the Commercial
Arbitration Rules of the American Arbitration Association, by a panel of three
arbitrators, one selected by the Executive, one selected by the Company and the
other selected by the two so chosen. Judgment upon the arbitration award
rendered by the arbitrators shall be binding and conclusive and may be entered
in any court having jurisdiction thereof. The costs of the arbitration shall be
borne by the Company.

          (b) In the event that the Executive receives an arbitration award
pursuant to subsection (a) above, the Company shall, within thirty (30) days
after the presentation of proper receipts or invoices therefor, reimburse the
Executive the reasonable fees and disbursements of counsel incurred in
connection of any amounts awarded the Executive pursuant thereto.

       16. TERMINATION OF PRE-EXISTING EMPLOYMENT AGREEMENT. The Company and
the Executive hereby acknowledge and agree that this Agreement replaces any
employment agreement previously entered into between the Company and the
Executive, and that any rights granted under any such pre-existing employment
agreement are hereby terminated and of no further force and effect.

         IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered as of the day and year first above set forth.

         GENIUS PRODUCTS, INC..

         BY:      /S/ Klaus Moeller
                  --------------------------
                  Klaus Moeller
                  CEO

         EXECUTIVE

         BY:      /S/ Alison Elliott
                  --------------------------
                  Alison Elliott

                                       6

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