Document:

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                                  Exhibit 10.7

                                 MUTUAL RELEASE

This Mutual Release (this "RELEASE"), dated as of May 17, 2002, is entered into
by and among National Lampoon Acquisition Group LLC, a California limited
liability company ("NLAG"), Daniel S. Laikin ("LAIKIN"), Paul Skjodt, Timothy S.
Durham, Samerian LLP, an Indiana limited liability partnership, Diamond
Investments, LLC, an Indiana limited liability company, Christopher R. Williams,
Helen C. Williams, DW Leasing Company, LLC, an Indiana limited liability
company, and Judy B. Laikin (each, a "NLAG PARTY", and, collectively, the "NLAG
PARTIES"), James P. Jimirro ("JIMIRRO") and J2 Communications, a California
corporation (the "COMPANY"). The NLAG Parties, Jimirro and the Company are each
referred to individually in this Release as a "PARTY" and, collectively, as the
"PARTIES."

1. DEFINITIONS Each of the following terms shall have the following meanings as
used herein:

        (a) "CLAIMS" shall mean all claims, debts, liabilities, losses, demands,
obligations, duties, liens, promises, acts, agreements, costs and expenses
(including but not limited to costs of investigation and defense and reasonable
attorneys' fees), damages (including actual, consequential and incidental
damages, diminution in value, punitive and other damages calculated as a
multiple of actual damages, penalties and fines), actions and causes of action,
of whatever kind or nature, including without limitation claims for injunctive
relief, whether arising under contract, tort, statute, regulation or by
operation of law.

        (b) "COMPANY ACTION" shall mean that certain action pending in United
States District Court for the Central District of California, Western Division,
entitled J2 Communications vs. Daniel S. Laikin; Judy B. Laikin; Sidney J.
Laikin; Paul Skjodt; Cynthia Skjodt; Christopher R. Williams; Helen C. Williams;
Diamond Investment, LLC, An Indiana Limited Liability Company; DW Leasing
Company, LLC; Samerian LLP; Carroll Edwards; Cooper L. Williams; Edward
Kowlowski; John Swinehart; Timothy Durham; Gregory Sarkisian; Gary Perel; Debra
Goldfarb; Hal Harlan; Errol Gerson; Charles Finkl; Reno R. Rolle; and Lenny
Young, Case No. CV 01-10282-RMT (JTLx).

        (c) "DRAFT LAIKIN COMPLAINT" shall mean the draft complaint captioned
"DANIEL S. LAIKIN, Plaintiff, vs. JAMES P. JIMIRRO, BRUCE P. VANN, JAMES
FELLOWS, JOHN DE SIMIO, GARY COWAN, J2 COMMUNICATIONS, a California corporation,
and DOES 1 though 10, inclusive, Defendants" transmitted by John C. Kirkland to
Bruce P. Vann via electronic mail on or about December 6, 2001.

        (d) "INFORMATION" shall mean any and all information relevant to the
Released Matters and the negotiation and execution of the Stock Purchase
Agreement and the documents that are exhibits thereto and the consummation of
the transactions contemplated thereby, including but not limited to the
following categories of

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information: (a) facts regarding the identification and description of documents
relevant to the matters and issues raised in the Released Matters and the
negotiation and execution of the Stock Purchase Agreement and the documents that
are exhibits thereto and the consummation of the transactions contemplated
thereby; (b) facts and other information and advice regarding the transactions,
events and claims raised in the Released Matters and the negotiation and
execution of the Stock Purchase Agreement and the documents that are exhibits
thereto and the consummation of the transactions contemplated thereby; (c)
information, documents, advice and other communications obtained, developed and
held by any of the Joint Advisors or NLAG Advisors (as applicable) in connection
with, or as a result of, any of the transactions, events and claims raised in
the Released Matters and the negotiation and execution of the Stock Purchase
Agreement and the documents that are exhibits thereto and the consummation of
the transactions contemplated thereby; (d) legal advice and other communications
from and to counsel, whether in writing or given orally, in relation to or
relevant to any of the Released Matters and the negotiation and execution of the
Stock Purchase Agreement and the documents that are exhibits thereto and the
consummation of the transactions contemplated thereby; and (e) all other
documents, writings, billing records, communications, data and workpapers,
whether in electronic form or otherwise in relation to or relevant to any of the
Released Matters and the negotiation and execution of the Stock Purchase
Agreement and the documents that are exhibits thereto and the consummation of
the transactions contemplated thereby. For the avoidance of doubt, the term
"documents" is used herein in its customary broad sense and includes (without
limitation) any kind of printed, recorded, written, graphic or photographic
matter (including tape recordings and computer data), however printed, produced,
reproduced, coded or stored, of any kind or description, whether or not sent or
received, including but not limited to reproductions, facsimiles, or drafts, and
also includes (without limitation) papers, books, accounts, correspondence,
reports, memoranda, e-mail, tapes, handwritten, typewritten, stenographic or
dictated notes, invoices, computer printouts, disks, computer disks, compact
disks, storage devices, digital storage devices, data or files saved on computer
hard drives or computer networks, tapes, data, telex messages, work papers,
telephone logs, diaries, desk calendars, and things similar to any of the
foregoing.

        (e) "LERNER ACTION" shall mean that certain action pending in Superior
Court of the State of California for the County of Los Angeles, entitled
Lawrence D. Lerner v. J2 Communications and Does 1 through 10 inclusive, Case
No. 01K-23006.

        (f) "LETTER AGREEMENT" shall mean the letter agreement, dated March 5,
2001, among the Company, Jimirro, Laikin and Paul Skjodt.

        (g) "JOINT ADVISORS" shall mean the law firms of Kelly, Lytton & Vann
LLP, Latham & Watkins and Gibson, Dunn & Crutcher LLP and the investment banking
firm of Batchelder & Partners, LP.

        (h) "NASDAQ DELISTING" shall mean the delisting of the Company's common
stock from trading on the Nasdaq Small Cap Market on or about March 22, 2002 and
all other matters related to the trading (or lack thereof) of the Company's
securities on the public
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markets or any securities exchange.

        (i) "NLAG ACTION" shall mean that certain action pending in Superior
Court of the State of California for the County of Los Angeles, entitled
National Lampoon Acquisition Group, LLC, Daniel Laikin and Paul Skjodt v. J2
Communications, James P. Jimirro, et al., Case No. BC 262021.

        (j) "NLAG ACTION CROSS-COMPLAINT" shall mean the cross-complaint filed
by the Company and Jimirro in response to the NLAG Action.

        (k) "NLAG ADVISORS" shall mean law firms of Leagre Chandler & Millard,
LLP, Greenberg Traurig, LLP and the investment banking firm of GTH Capital.

        (l) "PROXY SOLICITATION" shall mean the proxy solicitation commenced by
Laikin on or about August 11, 2000.

        (m) "RELATED PERSONS" shall mean, with respect to any Party to this
Release, such Party's respective past and present successors, assigns, heirs,
representatives, partners, members, affiliates, agents, employees, servants,
executors, administrators, accountants, attorneys, family members and
investigators, in any and all capacities and, as the case may be, controlling
and/or controlled persons, stockholders, owners, officers, directors, insurers,
subsidiaries (whether or not wholly-owned) and divisions, if any, of such Party,
and each of such entity's respective past and present successors, assigns,
heirs, representatives, partners, members, affiliates, agents, employees,
servants, executors, administrators, accountants, attorneys and investigators,
and, as the case may be, the controlling and/or controlled persons,
stockholders, owners, officers, directors, insurers, subsidiaries (whether or
not wholly-owned) and divisions, if any, of such entity; provided, however,
that, for purposes of Sections 2(c), 2(f), 3(c), 3(f), 4(c) and 4(f), "NLAG
Party's Related Persons" shall not include the law firm of Greenberg Traurig,
LLP or the investment banking firm of GTH Capital, Inc. or their partners or
employees.

        (n) "RELEASED MATTERS" shall mean any and all matters related to, which
were asserted under, or which could have been asserted under, the: (i) the
Company and its subsidiaries (including, without limitation, with respect to any
individual, in respect of any such individual's relationship in all capacities
to the Company and any of its subsidiaries); (ii) the Letter Agreement; (iii)
the Proxy Solicitation; (iv) the Draft Laikin Complaint; (v) the NLAG Action;
(vi) the Lerner Action (vii) the Company Action; (viii) the NLAG Action
Cross-Complaint (ix) the Nasdaq Delisting; and (x) the purchase, sale, voting or
ownership, beneficial or otherwise, of any shares of capital stock of the
Company; but excluding the Stock Purchase Agreement Transactions.

        (o) "STOCK PURCHASE AGREEMENT" shall mean the Preferred Stock and
Warrant Purchase Agreement, dated as of April 25, 2002, as amended by the First
Amendment to Preferred Stock and Warrant Purchase Agreement dated May 17, 2002,
by and among the Company, NLAG and the other parties set forth on the schedule
of purchasers attached thereto, including, without limitation, the schedules and
exhibits thereto.
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        (p) "STOCK PURCHASE AGREEMENT TRANSACTIONS" shall mean the transactions
contemplated by the Stock Purchase Agreement but excluding, for the avoidance of
doubt, the transactions contemplated by this Release.

2. RELEASES.

        (a) For good and valuable consideration, the adequacy of which is hereby
acknowledged, each NLAG Party hereby knowingly and voluntarily, on behalf of
such NLAG Party and each such NLAG Party's Related Persons (it being expressly
understood and agreed that for all purposes hereunder the Company shall be
deemed not to be an NLAG Party Related Person), forever relieves, releases, and
discharges the Company and each Company Related Person (it being expressly
understood and agreed that for all purposes hereunder Jimirro shall be deemed
not to be a Company Related Person) from any and all Claims which any NLAG Party
and any NLAG Related Person now has, has ever had or may hereafter have against
the Company and each Company Related Person on account of or arising out of any
and all matters, causes or events occurring prior to and including the date
hereof and relating in any way to the Released Matters.

        (b) For good and valuable consideration, the adequacy of which is hereby
acknowledged, each NLAG Party hereby knowingly and voluntarily, on behalf of
such NLAG Party and each such NLAG Party's Related Persons, forever relieves,
releases, and discharges Jimirro and each Jimirro Related Person from any and
all Claims which any NLAG Party and any NLAG Related Person now has, has ever
had or may hereafter have against Jimirro and each Jimirro Related Persons on
account of or arising out of any and all matters, causes or events occurring
prior to and including the date hereof and relating in any way to the Released
Matters.

        (c) For good and valuable consideration, the adequacy of which is hereby
acknowledged, the Company hereby knowingly and voluntarily, on behalf of itself
and each Company Related Person, forever relieves, releases, and discharges each
NLAG Party and each such NLAG Party's Related Persons from any and all Claims
which the Company and any Company Related Person now has, has ever had or may
hereafter have against such NLAG Party and each such NLAG Party's Related
Persons on account of or arising out of any and all matters, causes or events
occurring prior to and including the date hereof and relating in any way to the
Released Matters.

        (d) For good and valuable consideration, the adequacy of which is hereby
acknowledged, the Company hereby knowingly and voluntarily, on behalf of itself
and each Company Related Person, forever relieves, releases, and discharges
Jimirro and each Jimirro Related Person from any and all Claims which the
Company and any Company Related Person now has, has ever had or may hereafter
have against Jimirro and each Jimirro Related Person on account of or arising
out of any and all matters, causes or events occurring prior to and including
the date hereof and relating in any way to the Released Matters, but excluding
Claims on account of or arising out of that certain promissory note of Jimirro
dated July 14, 1986.

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        (e) For good and valuable consideration, the adequacy of which is hereby
acknowledged, the Company hereby knowingly and voluntarily forever relieves,
releases, and discharges each Company Related Person (other than the Company's
stockholders, owners and employees in their respective capacities as such) from
any and all Claims which the Company and any other Company Related Person now
has, has ever had or may hereafter have against such Company Related Person on
account of or arising out of any and all matters, causes or events occurring
prior to and including the date hereof and relating in any way to the Released
Matters.

        (f) For good and valuable consideration, the adequacy of which is hereby
acknowledged, Jimirro hereby knowingly and voluntarily, on behalf of himself and
each Jimirro Related Person, forever relieves, releases, and discharges each
NLAG Party and each such NLAG Party's Related Persons from any and all Claims
which Jimirro and any Jimirro Related Person now has, has ever had or may
hereafter have against each NLAG Party and each such NLAG Party's Related
Persons on account of or arising out of any and all matters, causes or events
occurring prior to and including the date hereof and relating in any way to the
Released Matters.

        (g) For good and valuable consideration, the adequacy of which is hereby
acknowledged, Jimirro hereby knowingly and voluntarily, on behalf of himself and
each Jimirro Related Person, forever relieves, releases, and discharges the
Company (except with respect to the obligations set forth on Schedule A hereto)
and each Company Related Person from any and all Claims which Jimirro and any
Jimirro Related Person now has, has ever had or may hereafter have against the
Company (except with respect to the obligations set forth on Schedule A hereto)
and each Company Related Person on account of or arising out of any and all
matters, causes or events occurring prior to and including the date hereof and
relating in any way to the Released Matters.

3. LITIGATION.

        (a) Each NLAG Party hereby knowingly, voluntarily and irrevocably
covenants that each NLAG Party and each such NLAG Party's Related Persons shall
(i) refrain from, directly or indirectly (including without limitation by
derivative action as a shareholder of the Company), asserting any claim or
demand, or commencing, instituting, causing to be commenced or supporting, any
claim, litigation, action or proceeding of any kind against the Company or any
Company Related Person, based upon any matter relieved, released or discharged
hereby, and (ii) not directly or indirectly cause the Company or any other
entity or individual to commence, or to assist the Company or any such other
entity or individual in the commencement of, any derivative action based on any
Claims which the Company now has, has ever had or may hereafter have against any
Company Related Person on account of or arising out of any matter relieved,
released or discharged hereby, and, if such an action referred to in either
clause (i) or (ii) has been or is commenced, such NLAG Party will not support
such action and will use such NLAG Party's best efforts to cause such action to
be dismissed with prejudice and withdrawn and, in the case of a derivative
action, to cause the actions that are the subject thereof to be ratified and
approved by the stockholders of the Company.
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        (b) Each NLAG Party hereby knowingly, voluntarily and irrevocably
covenants that each NLAG Party and each such NLAG Party's Related Persons shall
(i) refrain from, directly or indirectly (including without limitation by
derivative action as a shareholder of the Company), asserting any claim or
demand, or commencing, instituting, causing to be commenced or supporting, any
claim, litigation, action or proceeding of any kind against Jimirro or any
Jimirro Related Person, based upon any matter relieved, released or discharged
hereby, and (ii) not directly or indirectly cause the Company or any other
entity or individual to commence, or to assist the Company or any such other
entity or individual in the commencement of, any derivative action based on any
Claims which the Company now has, has ever had or may hereafter have against
Jimirro and any Jimirro Related Person on account of or arising out of any
matter relieved, released or discharged hereby, and, if such an action referred
to in either clause (i) or (ii) has been or is commenced, such NLAG Party will
not support such action and will use such NLAG Party's best efforts to cause
such action to be dismissed with prejudice and withdrawn and, in the case of a
derivative action, to cause the actions that are the subject thereof to be
ratified and approved by the stockholders of the Company.

        (c) The Company hereby knowingly, voluntarily and irrevocably covenants
that the Company and each Company Related Persons shall (i) refrain from,
directly or indirectly (including without limitation by derivative action as a
shareholder of the Company), asserting any claim or demand, or commencing,
instituting, causing to be commenced or supporting, any claim, litigation,
action or proceeding of any kind against any NLAG Party or any such NLAG Party's
Related Persons, based upon any matter relieved, released or discharged hereby,
and (ii) not directly or indirectly cause the Company or any other entity or
individual to commence, or to assist the Company or any such other entity or
individual in the commencement of, any derivative action based on any Claims
which the Company now has, has ever had or may hereafter have against any NLAG
Party or any such NLAG Party's Related Persons on account of or arising out of
any matter relieved, released or discharged hereby, and, if such an action
referred to in either clause (i) or (ii) has been or is commenced, the Company
will not support such action and will use its best efforts to cause such action
to be dismissed with prejudice and withdrawn and, in the case of a derivative
action, to cause the actions that are the subject thereof to be ratified and
approved by the stockholders of the Company.

        (d) The Company hereby knowingly, voluntarily and irrevocably covenants
that the Company and each Company Related Persons shall (i) refrain from,
directly or indirectly (including without limitation by derivative action as a
shareholder of the Company), asserting any claim or demand, or commencing,
instituting, causing to be commenced or supporting, anyclaim, litigation, action
or proceeding of any kind against Jimirro or any Jimirro Related Person, based
upon any matter relieved, released or discharged hereby, and (ii) not directly
or indirectly cause the Company or any other entity or individual to commence,
or to assist the Company or any such other entity or individual in the
commencement of, any derivative action based on any Claims which the Company now
has, has ever had or may hereafter have against Jimirro or any Jimirro Related
Person on account of or arising out of any matter relieved, released or
discharged hereby, and, if such an action referred to in either clause (i) or
(ii) has been or is

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commenced, the Company will not support such action and will use its best
efforts to cause such action to be dismissed with prejudice and withdrawn and,
in the case of a derivative action, to cause the actions that are the subject
thereof to be ratified and approved by the stockholders of the Company.

        (e) The Company hereby knowingly, voluntarily and irrevocably covenants
that the Company and each Company Related Persons shall (i) refrain from,
directly or indirectly (including without limitation by derivative action as a
shareholder of the Company), asserting any claim or demand, or commencing,
instituting, causing to be commenced or supporting, any claim, litigation,
action or proceeding of any kind against any other Company Related Person (other
than the Company's stockholders, owners and employees in their respective
capacities as such), based upon any matter relieved, released or discharged
hereby, and (ii) not directly or indirectly cause the Company or any other
entity or individual to commence, or to assist the Company or any such other
entity or individual in the commencement of, any derivative action based on any
Claims which the Company now has, has ever had or may hereafter have against any
other Company Related Person (other than the Company's stockholders, owners and
employees in their respective capacities as such) on account of or arising out
of any matter relieved, released or discharged hereby, and, if such an action
referred to in either clause (i) or (ii) has been or is commenced, the Company
will not support such action and will use its best efforts to cause such action
to be dismissed with prejudice and withdrawn and, in the case of a derivative
action, to cause the actions that are the subject thereof to be ratified and
approved by the stockholders of the Company.

        (f) Jimirro hereby knowingly, voluntarily and irrevocably covenants that
Jimirro and each Jimirro Related Persons shall (i) refrain from, directly or
indirectly (including without limitation by derivative action as a shareholder
of the Company), asserting any claim or demand, or commencing, instituting,
causing to be commenced or supporting, any claim, litigation, action or
proceeding of any kind against any NLAG Party or any such NLAG Party's Related
Persons, based upon any matter relieved, released or discharged hereby, and (ii)
not directly or indirectly cause the Company or any other entity or individual
to commence, or to assist the Company or any such other entity or individual in
the commencement of, any derivative action based on any Claims which the Company
now has, has ever had or may hereafter have against any NLAG Party or any such
NLAG Party's Related Persons on account of or arising out of any matter
relieved, released or discharged hereby, and, if such an action referred to in
either clause (i) or (ii) has been or is commenced, Jimirro will not support
such action and will use its best efforts to cause such action to be dismissed
with prejudice and withdrawn and, in the case of a derivative action, to cause
the actions that are the subject thereof to be ratified and approved by the
stockholders of the Company.

        (g) Jimirro hereby knowingly, voluntarily and irrevocably covenants that
Jimirro and each Jimirro Related Persons shall (i) refrain from, directly or
indirectly (including without limitation by derivative action as a shareholder
of the Company), asserting any claim or demand, or commencing, instituting,
causing to be commenced or supporting, any claim, litigation, action or
proceeding of any kind against the Company or any

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Company Related Person, based upon any matter relieved, released or discharged
hereby, and (ii) not directly or indirectly cause the Company or any other
entity or individual to commence, or to assist the Company or any such other
entity or individual in the commencement of, any derivative action based on any
Claims which the Company now has, has ever had or may hereafter have against any
Company Related Person on account of or arising out of any matter relieved,
released or discharged hereby, and, if such an action referred to in either
clause (i) or (ii) has been or is commenced, Jimirro will not support such
action and will use its best efforts to cause such action to be dismissed with
prejudice and withdrawn and, in the case of a derivative action, to cause the
actions that are the subject thereof to be ratified and approved by the
stockholders of the Company.

        (h) Each of the Parties shall, and shall cause their respective Related
Persons to, immediately upon execution of this Release, file stipulated
dismissals, with prejudice, of, and withdraw, all actions among them including,
without limitation, the following:

        (i) the NLAG Action (including, for the avoidance of doubt, the NLAG
Action Cross-Complaint); and (ii) the Company Action.

4. INDEMNIFICATION.

        (a) Without in any way limiting any of the rights and remedies otherwise
available to the Company and any Company Related Person, each NLAG Party hereby
agrees to defend, indemnify and hold harmless the Company and each Company
Related Person from and against all Claims, including third party claims,
arising directly or indirectly from, or in connection with, the assertion by or
on behalf of such NLAG Party or any of such NLAG Party's Related Persons of any
Claim on account of or arising out of any matter relieved, released or
discharged hereby.

        (b) Without in any way limiting any of the rights and remedies otherwise
available to Jimirro and any Jimirro Related Person, each NLAG Party hereby
agrees to defend, indemnify and hold harmless Jimirro and each Jimirro Related
Person from and against all Claims, including third party claims, arising
directly or indirectly from, or in connection with, the assertion by or on
behalf of such NLAG Party or any of such NLAG Party's Related Persons of any
Claim on account of or arising out of any matter relieved, released or
discharged hereby. (c) Without in any way limiting any of the rights and
remedies otherwise available to each NLAG Party and any such NLAG Party's
Related Persons, the Company hereby agrees to defend, indemnify and hold
harmless each NLAG Party and each such NLAG Party's Related Persons from and
against all Claims, including third party claims, arising directly or indirectly
from, or in connection with, the assertion by or on behalf of the Company or any
Company Related Person of any Claim on account of or arising out of any matter
relieved, released or discharged hereby.

        (d) Without in any way limiting any of the rights and remedies otherwise
available to Jimirro and any Jimirro Related Persons, the Company hereby agrees
to defend, indemnify and hold harmless Jimirro and each Jimirro Related Person
from and against all Claims, including third party claims, arising directly or
indirectly from, or in

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connection with, the assertion by or on behalf of the Company or any Company
Related Person of any Claim on account of or arising out of any matter relieved,
released or discharged hereby.

        (e) Without in any way limiting any of the rights and remedies otherwise
available to any Company Related Person, the Company hereby agrees to defend,
indemnify and hold harmless each Company Related Person (other than the
Company's stockholders, owners and employees in their respective capacities as
such) from and against all Claims, including third party claims, arising
directly or indirectly from, or in connection with, the assertion by or on
behalf of the Company or any of the other Company Related Persons of any Claim
on account of or arising out of any matter relieved, released or discharged
hereby.

        (f) Without in any way limiting any of the rights and remedies otherwise
available to each NLAG Party and any such NLAG Party's Related Persons, Jimirro
hereby agrees to defend, indemnify and hold harmless each NLAG Party and each
such NLAG Party's Related Persons from and against all Claims, including third
party claims, arising directly or indirectly from, or in connection with, the
assertion by or on behalf of Jimirro or any Jimirro Related Persons of any Claim
on account of or arising out of any matter relieved, released or discharged
hereby.

        (g) Without in any way limiting any of the rights and remedies otherwise
available to the Company and any Company Related Person, Jimirro hereby agrees
to defend, indemnify and hold harmless the Company and each Company Related
Person from and against all Claims, including third party claims, arising
directly or indirectly from, or in connection with, the assertion by or on
behalf of Jimirro or any Jimirro Related Persons of any Claim on account of or
arising out of any matter relieved, released or discharged hereby.

        (h) A Party obligated to defend a person or entity in accordance with
(a) through (g) of this Section 4 shall defend the person or entity at the
Party's expense and the person or entity entitled to be defended shall have the
right to participate in the defense at the person's or entity's own expense.

        5. GENERAL RELEASE; WAIVER OF RIGHTS. These releases cover both claims
that the Parties and their respective Related Persons know about or suspect and
those that the Parties and their respective Related Persons may not know about
or suspect. Each of the Parties, on such Party's own behalf and on behalf of
such Party's Related Persons, expressly waives all rights afforded by any
statute (such as Section 1542 of the Civil Code of the State of California
("SECTION 1542")), or common law principles of the same or similar effect, which
limits the effect of a release with respect to unknown claims. Each of the
Parties, on such Party's own behalf and on behalf of each of such Party's
Related Persons, understand the significance of such release of unknown claims
and the waiver of statutory protection against a release of unknown claims (such
as under Section 1542). Section 1542 states as follows:
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        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.

Notwithstanding the provisions of Section 1542, each Party, on such Party's own
behalf and on behalf of each of such Party's Related Persons, expressly
acknowledges that the releases set forth herein are intended to include all
claims released hereby, both known and unknown.

6. FURTHER ASSURANCES. Subject to the terms and conditions herein provided, each
of the Parties agrees to use its best efforts to take, or cause to be taken, all
action and to do, or cause to be done, all things necessary, proper, or
advisable under applicable laws and regulations, to consummate and make
effective the releases and other actions contemplated hereby, including
executing any further documentation to effectuate such releases, to obtain all
necessary waivers, consents, and approvals, and to effect all necessary
registrations and filings.

7. GOVERNING LAW; ENTIRE AGREEMENT; COUNTERPARTS. This Release shall be governed
by, and construed in accordance with, the internal law of the State of
California, without regard to conflicts of laws. This Release and the Stock
Purchase Agreement, including the schedules and exhibits thereto, constitute the
entire agreement among the parties with respect to the matters referred to
herein and therein and supersede any prior negotiations, understandings or
agreements with respect thereto. This Release may be executed in counterparts,
each of which shall be an original and all of which together shall constitute
one and the same instrument.

8. THIRD PARTY BENEFICIARIES. Each NLAG Related Person, each Company Related
Person and each Jimirro Related Person shall be deemed to be a third party
beneficiary of this Agreement.

9. ACKNOWLEDGEMENT OF JOINT DEFENSE.

        (a) Each of the Parties hereto agrees and acknowledges that, (i) prior
to the date hereof, Jimirro and the Company (acting through both its Board of
Directors and the Special Committee of the Board of Directors formed on August
18, 2000), on the one hand, and the various NLAG Parties, on the other hand,
were on opposing sides with respect to many of the Released Matters and certain
related matters, (ii) Jimirro and the Company (acting through both its Board of
Directors and the Special Committee of the Board of Directors) on the one hand,
and certain of the NLAG Parties, on the other hand, retained attorneys and other
advisors to assist them with respect to the Released Matters and certain related
matters and in the negotiation of the transactions contemplated by the Stock
Purchase Agreement and the documents that are exhibits thereto, (iii) the Joint
Advisors were engaged by the Company or Jimirro and the NLAG Advisors were
engaged by one or more of the NLAG Parties, (iv) in order for the transactions

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contemplated by the Stock Purchase Agreement and the documents that are exhibits
thereto to be consummated, it has been desirable for the Company, Jimirro and
the Joint Advisors to work cooperatively in connection with the Released Matters
and certain related matters and in the negotiation of such transactions, (v) in
order for the transactions contemplated by the Stock Purchase Agreement and the
documents that are exhibits thereto to be consummated, it has been desirable for
the NLAG Parties and the NLAG Advisors to work cooperatively in connection with
the Released Matters and certain related matters and in the negotiation of such
transactions, (vi) in connection with their engagements, the Joint Advisors have
shared Information amongst themselves and their respective clients which was and
is intended to be treated as confidential and not disclosed to any other person
or entity, (vii) in connection with their engagements, the NLAG Advisors have
shared Information amongst themselves and their respective clients which was and
is intended to be treated as confidential and not disclosed to any other person
or entity, and (viii) it is in the best interest of each of the Parties that all
such Information shared by Jimirro, the Company and the Joint Advisors, on the
one hand, and the NLAG Parties and the NLAG Advisors, on the other hand, in each
case in connection with the Released Matters and certain related matters and in
the negotiation of the transactions contemplated by the Stock Purchase Agreement
and the documents that are exhibits thereto remain confidential after the
consummation of such transactions and not disclosed other than internally among
such applicable group.

        (b) Each of the NLAG Parties hereto covenants and agrees, on its own
behalf and on behalf of its Related Persons (i) that the NLAG Parties and their
Related Persons shall not seek to obtain or to have disclosed any Information of
or shared between Jimirro, the Company and/or the Joint Advisors, or encourage,
assist, cause or permit any other person or entity to do so on their behalf or
otherwise take any steps designed to obtain access to such Information for
themselves, their Related Persons or the Company, and (ii) that the NLAG Parties
and their Related Persons shall at all times cooperate with the efforts of
Jimirro, the Company and the Joint Advisors, and shall use their commercially
reasonable efforts in the course of such cooperation, to cause the
confidentiality of all Information of or shared among Jimirro, the Company
and/or the Joint Advisors to be maintained.

        (c) Each of Jimirro and the Company covenants and agrees, on its own
behalf and on behalf of its Related Persons (i) that neither they nor their
Related Persons shall seek to obtain or to have disclosed any Information of or
shared between the NLAG Parties and/or the NLAG Advisors, or encourage, assist,
cause or permit any other person or entity to do so on their behalf or otherwise
take any steps designed to obtain access to such Information for themselves or
their Related Persons, and (ii) that they and their Related Persons shall at all
times cooperate with the efforts of the NLAG Parties and the NLAG Advisors, and
shall use their commercially reasonable efforts in the course of such
cooperation, to cause the confidentiality of all Information of or shared among
the NLAG Parties and/or the NLAG Advisors to be maintained.

        (d) Each of the Parties hereto agrees and acknowledges, on its own
behalf and on behalf of its Related Persons, that for the purposes of this
Section 9, from and after the

<PAGE>
date hereof, the Company will be considered and treated as a third party and at
and after such time the prior written consent of each of James P. Jimirro, and
each of the Joint Advisors shall be required for any disclosure of Information
by any of Jimirro, the Company or the Joint Advisors to the Company (from and
after the date hereof) or any member of the Board of Directors of the Company or
to any officer, employee, agent, affiliate or representative of the Company.
From and after the date hereof, the Company will at all times take all actions
that may be desirable or required to cause the confidentiality of all
Information of or shared among Jimirro, the Company and/or the Joint Advisors to
be maintained and will not permit the disclosure of any such Information other
than in conformity with this Section 9(d). Each of the Parties hereby agrees, on
its own behalf and on behalf of its Related Persons, that the failure of Jimirro
or any of the Joint Advisors to provide any such consent will not be a breach of
any duty owed by any of such persons to any other person.

                                      * * *
<PAGE>
        IN WITNESS WHEREOF, the parties have caused this Release to be executed
as of the date first set forth above.

                             NATIONAL LAMPOON ACQUISITION GROUP LLC

                             By:
                                -------------------------------------------
                             Name: Daniel S. Laikin
                             Title: Managing Member

                             ----------------------------------------------
                             DANIEL S. LAIKIN

                             ----------------------------------------------
                             PAUL SKJODT

                             ----------------------------------------------
                             TIMOTHY S. DURHAM

                             SAMERIAN LLP

                             By:
                                -------------------------------------------
                             Name: Paul Skjodt
                             Title: General Partner

                             By:
                                -------------------------------------------
                             Name: Cindy Skjodt
                             Title: General Partner

                             DIAMOND INVESTMENTS, LLC

                             By:
                                -------------------------------------------
                             Name: Timothy S. Durham
                             Title: Managing Member
<PAGE>

                             ----------------------------------------------
                             CHRISTOPHER R. WILLIAMS

                             ----------------------------------------------
                             HELEN C. WILLIAMS

                             DW LEASING COMPANY, LLC

                             By:
                                -------------------------------------------
                             Name: Timothy S. Durham
                             Title: Managing Member

                             ----------------------------------------------
                             JUDY B. LAIKIN

                             ----------------------------------------------
                             JAMES P. JIMIRRO

                             J2 COMMUNICATIONS

                             By:
                                -------------------------------------------
                             Name: James P. Jimirro
                             Title: President

<PAGE>
                                   SCHEDULE A

                 SCHEDULE OF EXCLUDED MATTERS FROM SECTIONS 2(g)

1.      The Stock Purchase Agreement Transactions.

2.      All salary and compensation earned by Jimirro since the date of the end
        of the last pay period of Jimirro immediately preceding the date of
        execution of this Release, provided that One Million One Hundred
        Thousand Dollars ($1,100,000) shall have been duly paid to Jimirro in
        connection with the Stock Purchase Agreement Transactions.

3.      The obligation of the Company to pay to the Internal Revenue Service,
        any State tax collection authority and/or any other relevant entity or
        authority all amounts withheld from Jimirro's salary or compensation in
        respect of (a) Federal and/or State taxes, (b) Social Security, (c)
        Federal Medicare, (d) any State Disability Insurance and (e) any other
        required withholdings.

4.      All amounts in respect of accrued vacation, holiday and/or sick leave of
        Jimirro.

5.      All and any rights to indemnification of Jimirro by the Company pursuant
        to (a) the Jimirro Indemnity Agreement (as defined in the Stock Purchase
        Agreement), (b) the Company's Articles of Incorporation and bylaws and
        (c) applicable law.

6.      All rights of Jimirro under all outstanding stock option agreements that
        survive the Closing.<PAGE>
                                                                    EXHIBIT 10.8

RESTATED INDEMNIFICATION AGREEMENT

        THIS AGREEMENT (the "Agreement") is made and entered into this 17th day
of May, 2002 between J2 Communications, a California corporation (the "Company")
and James P. Jimirro ("Indemnitee").

                                WITNESSETH THAT:

        WHEREAS, Indemnitee performs a valuable service for the Company; and

        WHEREAS, the Board of Directors of the Company having adopted the Second
Amended and Restated Articles of Incorporation (the "Certificate") permitting
the Board of Directors to indemnify certain agents and employees designated by
the Board of Directors (the "Officers") and directors (the "Directors") of the
Company; and

        WHEREAS, the Certificate and Section 317 of the California General
Corporation Law, as amended ("Law"), permits the Company to indemnify its
Officers and Directors; and

        WHEREAS, as a result of recent developments affecting the terms, scope
and availability of D & O Insurance there exists general uncertainty as to the
extent of protection afforded the Company's Officers and Directors by such D&O
Insurance and said uncertainty also exists under statutory and bylaw
indemnification provisions; and

        WHEREAS, in recognition of past services and in order to induce
Indemnitee to continue to serve as an officer and/or a director of the Company,
the Company has determined and agreed to enter into this contract with
Indemnitee;

        NOW, THEREFORE, in consideration of Indemnitee's continued service as an
Officer and/or a Director after the date hereof, the parties hereto agree as
follows:

        1. Indemnity of Indemnitee. The Company hereby agrees to hold harmless
and indemnity Indemnitee to the fullest extent authorized or permitted by the
provisions of the Law, as such may be amended from time to time, and Article IV
of the Certificate, as such may be amended. The benefits afforded hereby may not
be reduced at a subsequent date without the express written permission of the
Indemnitee. In furtherance of the foregoing indemnification, and without
limiting the generality thereof:

                (a) Proceedings Other Than Proceedings by or in the Right of the
        Company. Indemnitee shall be entitled to the rights of indemnification
        provided in this Section 1(a) if, by reason of his Corporate Status (as
        hereinafter defined), he is, or is threatened to be made, a party to or
        participant in any Proceeding (as hereinafter defined) other than a
        Proceeding by or in the right of the Company. Pursuant to this Section
        1(a), Indemnitee shall be indemnified against all Expenses (as
        hereinafter defined), judgments, penalties, fines and amounts paid in
        settlement actually and reasonably incurred by him or on his behalf in
        connection

<PAGE>

        with such Proceeding or any claim, issue or matter therein, if he acted
        in good faith and in a manner he reasonably believed to be in or not
        opposed to the best interests of the Company and, with respect to any
        criminal Proceeding, had no reasonable cause to believe his conduct was
        unlawful.

               (b) Proceedings by or in the Right of the Company. Indemnitee
        shall be entitled to the rights of indemnification provided in this
        Section 1(b) if, by reason of his Corporate Status, he is, or is
        threatened to be made, a party to or participant in any Proceeding
        brought by or in the right of the Company to procure a judgment in its
        favor. Pursuant to this Section 1(b), Indemnitee shall be indemnified
        against all Expenses actually and reasonably incurred by him or on his
        behalf in connection with such Proceeding if be acted in good faith and
        in a manner he reasonably believed to be in or not opposed to the best
        interests of the Company; provided, however, that, if applicable law so
        provides, no indemnification against such Expenses shall be made in
        respect of any claim, issue or matter in such Proceeding as to which
        Indemnitee shall have been adjudged to be liable to the Company unless
        and to the extent that the Superior Court of the State of California, or
        the court in which such Proceeding shall have been brought or is
        pending, shall determine that such indemnification may be made.

               (c) Indemnification for Expenses of a Party Who is Wholly or
        Partly Successful. Notwithstanding any other provision of this
        Agreement, to the extent that Indemnitee is, by reason of his Corporate
        Status, a party to and is successful, on the merits or otherwise, in any
        Proceeding, he shall be indemnified to the tiniest extent permitted by
        law against all Expenses actually and reasonably incurred by him or on
        his behalf in connection therewith. If Indemnitee is not wholly
        successful in such Proceeding but is successful, on the merits or
        otherwise, as to one or more but less than all claims, issues or matters
        in such Proceeding, the Company shall indemnify Indemnitee against all
        Expenses actually and reasonably incurred by him or on his behalf in
        connection with each successfully resolved claim, issue or matter. For
        purposes of this Section and without limitation, the termination of any
        claim, issue or matter in such a Proceeding by dismissal, with or
        without prejudice, shall be deemed to be a successful result as to such
        claim, issue or matter.

        2. Additional Indemnity.

                (a) Subject only to the exclusions set forth in Section 2(b)
        hereof, the Company hereby further agrees to hold harmless and indemnify
        Indemnitee against any and all Expenses, judgments, fines and amounts
        paid in settlement actually and reasonably incurred by Indemnitee in
        connection with any Proceeding (including an action by or on behalf of
        the Company) to which Indemnitee is, was or at any time becomes a party,
        or is threatened to be made a party, by reason of his Corporate Status;
        provided, however, that with respect to actions by or on behalf of the
        Company, indemnification of Indemnitee against

<PAGE>

        any judgments shall be made by the Company only as authorized in the
        specific case upon a determination that Indemnitee acted in good faith
        and in a manner he reasonably believed to be in or not opposed to the
        best interests of the Company; and

                (b) No indemnity pursuant to this Section 2 shall be paid by the
        Company:

                      (i) In respect to remuneration paid to Indemnitee if it
               shall be determined by a final judgment or other final
               adjudication that such remuneration was in violation of law;

                      (ii) On account of any suit in which judgment is rendered
               against Indemnitee for an accounting of profits made from the
               purchase or sale by Indemnitee of securities of the Company
               pursuant to the provisions of Section 16(b) of the Securities
               Exchange Act of 1934 and amendments thereto or similar provisions
               of any federal, state or local statutory law;

                      (iii) On account of Indemnitee's conduct which is finally
               adjudged to have been knowingly fraudulent or deliberately
               dishonest, or to constitute willful misconduct; or

                      (iv) If a final decision by a court having jurisdiction in
               the matter shall determine that such indemnification is not
               lawful.

        3. Contribution. If the indemnification provided in Sections 1 and 2 is
unavailable and may not be paid to Indemnitee for any reason other than those
set forth in paragraphs (i), (ii) and (iii) of Section 2(b), then in respect to
any Proceeding in which the Company is jointly liable with Indemnitee (or would
be if joined in such Proceeding), the Company shall contribute to the amount of
Expenses, judgments, fines and amounts paid in settlement actually and
reasonably incurred and paid or payable by Indemnitee in such proportion as is
appropriate to reflect (i) the relative benefits received by the Company on the
one hand and by the Indemnitee on the other hand from the transaction from which
such Proceeding arose, and (ii) the relative fault of the Company on the one
hand and of the Indemnitee on the other hand in connection with the events which
resulted in such Expenses, judgments, fines or settlement amounts, as well as
any other relevant equitable considerations. The relative fault of the Company
on the one band and of the Indemnitee on the other hand shall be determined by
reference to, among other things, the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent the circumstances
resulting in such Expenses, judgments, fines or settlement amounts. The Company
agrees that it would not be just and equitable if contribution pursuant to this
Section 3 were determined by pro rata allocation or any other method of
allocation which does not take account of the foregoing equitable
considerations.

        4. Indemnification for Expenses of a Witness. Notwithstanding any other
provision of this Agreement, to the extent that Indemnitee is, by reason of his
Corporate Status, a witness in any Proceeding to which Indemnitee is not a
party, he shall be

<PAGE>

indemnified against all Expenses actually and reasonably incurred by him or on
his behalf in connection therewith.

        5. Advancement of Expenses. Notwithstanding any other provision of this
Agreement, the Company shall advance all reasonable Expenses incurred by or on
behalf of Indemnitee in connection with any Proceeding by reason of Indemnitee's
Corporate Status within ten days after the receipt by the Company of a statement
or statements from Indemnitee requesting such advance or advances from time to
time, whether prior to or after final disposition of such Proceeding. Such
statement or statements shall reasonably evidence the Expenses incurred by
Indemnitee and shall include or be preceded or accompanied by an undertaking by
or on behalf of Indemnitee to repay any Expenses advanced if it shall ultimately
be determined that Indemnitee is not entitled to be indemnified against such
Expenses. Any advances and undertakings to repay pursuant to this Section 5
shall be unsecured and interest free. Notwithstanding the foregoing, the
obligation of the Company to advance Expenses pursuant to this Section 5 shall
be subject to the condition that, if, when and to the extent that the Company
determines that Indemnitee would not be permitted to be indemnified under
applicable law, the Company shall be entitled to be reimbursed, within thirty
(30) days of such determination, by Indemnitee (who hereby agrees to reimburse
the Company) for all such amounts theretofore paid; provided, however, that if
Indemnitee has commenced or thereafter commences legal proceedings in a court of
competent jurisdiction to secure a determination that Indemnitee should be
indemnified under applicable law, any determination made by the Company that
Indemnitee would not be permitted to be indemnified under applicable law shall
not be binding and Indemnitee shall not be required to .reimburse the Company
for any advance of Expenses until a final judicial determination is made with
respect thereto (as to which all rights of appeal therefrom have been exhausted
or lapsed).

        6. Procedure for Determination of Entitlement to Indemnification.

               (a) To obtain indemnification (including, but not limited to, the
        advancement of Expenses and contribution by the Company) under this
        Agreement, Indemnitee shall submit to the Chief Executive Officer (if
        Indemnitee is not then serving as the Chief Executive Officer) or Chief
        Financial Officer a written request, including therein or therewith such
        documentation and information as is reasonably available to Indemnitee
        and is reasonably necessary to determine whether and to what extent
        Indemnitee is entitled to indemnification. The Secretary or any
        Assistant Secretary of the Company shall, promptly upon receipt of such
        a request for indemnification, advise the Board of Directors in writing
        that Indemnitee has requested indemnification.

               (b) Upon written request by Indemnitee for indemnification
        pursuant to the first sentence of Section 6(a) hereof, a determination,
        if required by applicable law, with respect to Indemnitee's entitlement
        thereto shall be made in the specific case:

                        (i) if a Change in Control (as hereinafter defined)
                shall have

<PAGE>

                occurred, by Independent Counsel (as hereinafter defined) in a
                written opinion to the Board of Directors, a copy of which shall
                be delivered to Indemnitee (unless Indemnitee shall request that
                such determination be made by the Board of Directors or the
                stockholders, in which case the determination shall be made in
                the manner provided in Clause (ii) below), or

                        (ii) if a Change in Control shall not have occurred, (A)
                by the Board of Directors by a majority vote of a quorum
                consisting of Disinterested Directors (as hereinafter defined),
                or (B) if a quorum of the Board of Directors consisting of
                Disinterested Directors is not obtainable or, even if
                obtainable, said Disinterested Directors so direct, by
                Independent Counsel in a written opinion to the Board of
                Directors, a copy of which shall be delivered to Indemnitee, or
                (C) if so directed by said Disinterested Directors, by the
                stockholders of the Company. If it is determined that Indemnitee
                is entitled to indemnification, payment to Indemnitee shall be
                made within ten (10) days after such determination. Indemnitee
                shall cooperate with the person, persons or entity making such
                determination with respect to Indemnitee's entitlement to
                indemnification, including providing to such person, persons or
                entity upon reasonable advance request any documentation or
                information which is not privileged or otherwise protected from
                disclosure and which is reasonably available to Indemnitee and
                reasonably necessary to such determination. Any Independent
                Counsel, member of the Board of Directors, or stockholder of the
                Company shall act reasonably and in good faith in making a
                determination under the Agreement of the Indemnitee's
                entitlement to indemnification. Any Expenses incurred by
                Indemnitee in so cooperating with the person, persons or entity
                making such determination shall be borne by the Company
                (irrespective of the determination as to Indemnitee's
                entitlement to indemnification) and the Company hereby
                indemnifies and agrees to hold Indemnitee harmless therefrom.

                (c) If the determination of entitlement to indemnification is to
        be made by Independent Counsel pursuant to Section 6(b) hereof, the
        Independent Counsel shall be selected as provided in this Section 6(c).
        If a Change in Control shall not have occurred, the Independent Counsel
        shall be selected by the Board of Directors, and the Company shall give
        written notice to Indemnitee advising him of the identity of the
        Independent Counsel so selected. If a Change in Control shall have
        occurred, the Independent Counsel shall be selected by Indemnitee
        (unless Indemnitee shall request that such selection be made by the
        Board of Directors, in which event the preceding sentence shall apply),
        and Indemnitee shall give written notice to the Company advising it of
        the identity of the Independent Counsel so selected. In either event,
        Indemnitee or the Company, as the case may be, may, within 10 days after
        such written notice of selection shall have been given, deliver to the
        Company or to Indemnitee, as the case may be, a written objection to
        such selection; provided, however, that such objection may be

<PAGE>

        asserted only on the ground that the Independent Counsel so selected
        does not meet the requirements of "Independent Counsel" as defined in
        Section 14 of this Agreement, and the objection shall set forth with
        particularity the factual basis of such assertion. Absent a proper and
        timely objection, the person so selected shall act as Independent
        Counsel. If a written objection is made and substantiated, the
        Independent Counsel selected may not serve as Independent Counsel unless
        and until such objection is withdrawn or a court has determined that
        such objection is without merit. If, within 20 days after submission by
        Indemnitee of a written request for indemnification pursuant to Section
        6(a) hereof, no Independent Counsel shall have been selected and not
        objected to, either the Company or Indemnitee may petition the Superior
        Court of the State of California or other court of competent
        jurisdiction for resolution of any objection which shall have been made
        by the Company or Indemnitee to the other's selection of Independent
        Counsel and/or for the appointment as independent Counsel of a person
        selected by the court or by such other person as the court shall
        designate, and the person with respect to whom all objections are so
        resolved or the person so appointed shall act as Independent Counsel
        under Section 6(b) hereof. The Company shall pay any and all reasonable
        fees and expenses of Independent Counsel incurred by such Independent
        Counsel in connection with acting pursuant to Section 6(b) hereof, and
        the Company shall pay all reasonable fees and expenses incident to the
        procedures of this Section 6(c), regardless of the manner in which such
        Independent Counsel was selected or appointed. Upon the due commencement
        of any judicial proceeding or arbitration pursuant to Section 8(a)(iii)
        of this Agreement, Independent Counsel shall be discharged and relieved
        of any further responsibility in such capacity (subject to the
        applicable standards of professional conduct then prevailing).

                (d) The Company shall not be required to obtain the consent of
        the Indemnitee to the settlement of any Proceeding which the Company has
        undertaken to defend if the Company assumes full and sole responsibility
        for such settlement and the settlement grants the Indemnitee a complete
        and unqualified release in respect of the potential liability.

        7. Presumptions and Effect of Certain Proceedings.

                (a) In making a determination with respect to entitlement to
        indemnification hereunder, the person or persons or entity making such
        determination shall presume that Indemnitee is entitled to
        indemnification under this Agreement if Indemnitee has submitted a
        request for indemnification in accordance with Section 6(a) of this
        Agreement, and the Company shall have the burden of proof to overcome
        that presumption in connection with the making by any person, persons or
        entity of any determination contrary to that presumption.

                (b) If the person, persons or entity empowered or selected under
        Section 5 of this Agreement to determine whether Indemnitee is entitled
        to indemnification shall not have made a determination within thirty
        (30) days after receipt by the

<PAGE>

        Company of the request therefor, the requisite determination of
        entitlement to indemnification shall be deemed to have been made and
        Indemnitee shall be entitled to such indemnification, absent

                      (i) a misstatement by Indemnitee of a material fact, or an
               omission of a material fact necessary to make Indemnitee's
               statement not materially misleading, in connection with the
               request for indemnification, or

                      (ii) a prohibition of such indemnification under
               applicable law; provided, however, that such 30 day period may be
               extended for a reasonable time, not to exceed an additional
               fifteen (15) days, if the person, persons or entity making the
               determination with respect to entitlement to indemnification in
               good faith requires such additional time for the obtaining or
               evaluating documentation and/or information relating thereto; and
               provided, further, that the foregoing provisions of this Section
               7(b) shall not apply if the determination of entitlement to
               indemnification is to be made by the stockholders pursuant to
               Section 5(b) of this Agreement and if (A) within fifteen (15)
               days after receipt by the Company of the request for such
               determination the Board of Directors or the Disinterested
               Directors, if appropriate, resolve to submit such determination
               to the stockholders for their consideration at an annual meeting
               thereof to be held within seventy-five (75) days after such
               receipt and such determination is made thereat, or (B) a special
               meeting of stockholders is called within fifteen (15) days after
               such receipt for the purpose of making such determination, such
               meeting is held for such purpose within sixty (60) days after
               having been so called and such determination is made thereat, or

                      (iii) if the determination of entitlement to
               indemnification is to be made by Independent Counsel pursuant to
               Section 6(b) of this Agreement.

                (c) The termination of any Proceeding or of any claim, issue or
        matter therein, by judgment, order, settlement (with or without court
        approval), conviction, or upon a plea of nolo contendre or its
        equivalent, shall not (except as otherwise expressly provided in this
        Agreement) of itself adversely affect the right of Indemnitee to
        indemnification or create a presumption that Indemnitee did not act in
        good faith and in a manner which he reasonably believed to be in or not
        opposed to the best interests of the Company or, with respect to any
        criminal Proceeding, that Indemnitee had reasonable cause to believe
        that his conduct was unlawful.

                (d) For purposes of any determination of good faith, Indemnitee
        shall be deemed to have acted in good faith if Indemnitee's action is
        based on the records or books of account of the Enterprise (as
        hereinafter defined), including financial statements, or on information
        supplied to Indemnitee by the Officers and Directors of the Enterprise
        in the course of their duties, or on the advice of legal

<PAGE>

        counsel for the Enterprise or on information or records given or reports
        made to the Enterprise by an independent certified public accountant or
        by an appraiser or other expert selected with reasonable care by the
        Enterprise. In addition, the knowledge and/or actions, or failure to
        act, of any director, officer, agent or employee of the Enterprise shall
        not be imputed to Indemnitee for purposes of determining the right to
        indemnification under this Agreement. The provisions of this Section
        7(d) shall not be deemed to be exclusive or to limit in any way the
        other circumstances in which the Indemnitee may be deemed to have met
        the applicable standard of conduct set forth in this Agreement.

        8. Remedies of Indemnitee.

               (a)In the event that:

                        (i) a determination is made pursuant to Section 6 of
                this Agreement that Indemnitee is not entitled to
                indemnification under this Agreement,

                        (ii) advancement of Expenses is not timely made pursuant
                to Section 5of this Agreement,

                        (iii) no determination of entitlement to indemnification
                shall have been made pursuant to Section 6(b) of this Agreement
                within ninety (90) days after receipt by the Company of the
                request for indemnification,

                        (iv) payment of indemnification is not made pursuant to
                Section 3 or 4 of this Agreement within ten (10) days after
                receipt by the Company of a written request therefor, or

                        (v) payment of indemnification is not made within ten
                (10) days after a determination has been made that Indemnitee is
                entitled to indemnification or such determination is deemed to
                have been made pursuant to Section 6 or 7 of this Agreement,
                Indemnitee shall be entitled to an adjudication in an
                appropriate court of the State of California, or in any other
                court of competent jurisdiction, of his entitlement to such
                indemnification. Alternatively, Indemnitee, at his option, may
                seek an award in arbitration to be conducted by a single
                arbitrator pursuant to the Commercial Arbitration Rules of the
                American Arbitration Association. Indemnitee shall commence such
                proceeding seeking an adjudication or an award in arbitration
                within one hundred eighty (180) days following the date on which
                Indemnitee first has the right to commence such proceeding
                pursuant to this Section 8(a). The Company shall not oppose
                Indemnitee's right to seek any such adjudication or award in
                arbitration.

                (b) In the event that a determination shall have been made
        pursuant to Section 6(b) of this Agreement that Indemnitee is not
        entitled to indemnification, any judicial proceeding or arbitration
        commenced pursuant to this Section 8 shall

<PAGE>

        be conducted in all respects as a de novo trial, or arbitration, on the
        merits and Indemnitee shall not be prejudiced by reason of that adverse
        determination.

                (c) If a determination shall have been made pursuant to Section
        6(b) of this Agreement that Indemnitee is entitled to indemnification,
        the Company shall be bound by such determination in any judicial
        proceeding or arbitration commenced pursuant to this Section 8, absent:

                        (i) a misstatement by Indemnitee of a material fact, or
                an omission of a material fact necessary to make Indemnitee's
                statement not materially misleading, in connection with the
                request for indemnification, or

                        (ii) a prohibition of such indemnification under
                applicable law.

                (d) In the event that Indemnitee, pursuant to this Section 8,
        seeks a judicial adjudication of or an award in arbitration to enforce
        his rights under, or to recover damages for breach of this Agreement,
        Indemnitee shall be entitled to recover from the Company, and shall be
        indemnified by the Company against, any and all expenses (of the types
        described in the definition of Expenses in Section 14 of this Agreement)
        actually and reasonably incurred by him in such judicial adjudication or
        arbitration, but only if he prevails therein. If it shall be determined
        in said judicial adjudication or arbitration that Indemnitee is entitled
        to receive part but not all of the indemnification sought, the expenses
        incurred by Indemnitee in connection with such judicial adjudication or
        arbitration shall be appropriately prorated. The Company shall indemnify
        Indemnitee against any and all expenses and, if requested by Indemnitee,
        shall (within ten (10) days after receipt by the Company of a written
        request therefor) advance such expenses to Indemnitee, which are
        incurred by Indemnitee in connection with any action brought by
        Indemnitee to recover under any Directors' and Officers' liability
        insurance policies maintained by the Company, regardless of whether
        Indemnitee ultimately is determined to be entitled to such
        indemnification, advancement of expenses or insurance recovery, as the
        case may be.

                (e) The Company shall be precluded from asserting in any
        judicial proceeding or arbitration commenced pursuant to this Section 8
        that the procedures and presumptions of this Agreement are not valid,
        binding and enforceable and shall stipulate in any such court or before
        any such arbitrator that the Company is bound by all the provisions of
        this Agreement.

9. Non-Exclusivity; Survival of Rights; Insurance; Subrogation.

                (a) The rights of indemnification as provided by this Agreement
        shall not be deemed exclusive of any other rights to which Indemnitee
        may at anytime be entitled under applicable law, the Certificate, any
        agreement, a vote of

<PAGE>

        stockholders or a resolution of Directors, or otherwise. No amendment,
        alteration or repeal of this Agreement or of any provision hereof shall
        limit or restrict any right of Indemnitee under this Agreement in
        respect of any action taken or omitted by such Indemnitee in his
        Corporate Status prior to such amendment, alteration or repeal. To the
        extent that a change in the Law, whether by statute or judicial
        decision, permits greater indemnification than would be afforded
        currently under the Certificate and this Agreement, it is the intent of
        the parties hereto that Indemnitee shall enjoy by this Agreement the
        greater benefits so afforded by such change. No right or remedy herein
        conferred is intended to be exclusive of any other right or remedy, and
        every other right and remedy shall be cumulative and in addition to
        every other right and remedy given hereunder or now or hereafter
        existing at law or in equity or otherwise. The assertion or employment
        of any right or remedy hereunder, or otherwise, shall not prevent the
        concurrent assertion or employment of any other right or remedy.

                (b) To the extent that the Company maintains an insurance policy
        or policies providing liability insurance for Directors, Officers,
        employees, or agents or fiduciaries of the Company or of any other
        corporation, partnership, joint venture, trust, employee benefit plan or
        other enterprise which such person serves at the request of the Company,
        Indemnitee shall be covered by such policy or policies in accordance
        with its or their terms to the maximum extent of the coverage available
        fir any such director, officer, employee or agent under such policy or
        policies. A minimum of One Million Dollars ($1,000,000) of insurance
        shall be maintained at all times.

                (c) In the event of any payment under this Agreement, the
        Company shall be subrogated to the extent of such payment to all of the
        rights of recovery of Indemnitee, who shall execute all papers required
        and take all action necessary to secure such rights, including execution
        of such documents as are necessary to enable the Company to bring suit
        to enforce such rights; provided, however, the Company may not be
        subrogated to any rights until Indemnitee has been paid in full all
        amounts owed to him hereunder, or unless Indemnitee shall have secured
        all benefits owing to him hereunder.

                (d) The Company shall not be liable under this Agreement to make
        any payment of amounts otherwise indemnifiable hereunder if and to the
        extent that Indemnitee has otherwise actually received such payment
        under any insurance policy, contract, agreement or otherwise.

        10. Exception to Right of Indemnification. Notwithstanding any other
provision of this Agreement, Indemnitee shall nor be entitled to indemnification
under this Agreement with respect to any Proceeding brought by Indemnitee, or
any claim therein, unless

                (a) the bringing of such Proceeding or making of such claim
        shall have been approved by the Board of Directors or

<PAGE>

               (b) such Proceeding is being brought by the Indemnitee to assert
        his rights under this Agreement.

        11. Duration of Agreement. All agreements and obligations of the Company
contained herein shall continue during the period Indemnitee is an officer
and/or a director of the Company (or is or was serving at the request of the
Company as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise) and shall continue
thereafter so long as Indemnitee shall be subject to any Proceeding (or any
proceeding commenced under Section 3 hereof) by reason of his Corporate Status,
whether or not he is acting or serving in any such capacity at the time any
liability or expense is incurred for which indemnification can be provided under
this Agreement. This Agreement shall be binding upon and inure to the benefit of
and be enforceable by the parties hereto and their respective successors
(including any direct or indirect successor by purchase, merger, consolidation
or otherwise to all or substantially all of the business or assets of the
Company), assigns, spouses, heirs, executors and personal and legal
representatives. This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as an officer and/or a director of the Company or
any other enterprise at the Company's request.

        12. Security. The Company acknowledges and agrees that its obligations
to Indemnitee pursuant to this Agreement are secured by all of the Company's
assets pursuant to that certain Security Agreement dated as of May 17, 2002. To
the extent requested by the Indemnitee and approved by the Board of Directors,
the Company may at any time and from time to time provide additional security to
the Indemnitee for the Company's obligations hereunder through an irrevocable
bank line of credit, funded trust or other collateral. Any and all such
security, once provided to the Indemnitee, may not be revoked or released
without the prior written consent of the Indemnitee.

        13. Enforcement.

                (a) The Company expressly confirms and agrees that it has
        entered into this Agreement and assumed the obligations imposed on it
        hereby in order to induce Indemnitee to serve as an officer and/or a
        director of the Company, and the Company acknowledges that Indemnitee is
        relying upon this Agreement in serving as an officer and/or a director
        of the Company.

                (b) This Agreement constitutes the entire agreement between the
        pates hereto with respect to the subject matter hereof and supersedes
        all prior agreements and understandings, oral, written and implied,
        between the parties hereto with respect to the subject matter hereof.

        14. Definitions. For purposes of this Agreement:

                (a) "Change in Control" means a change in control of the Company
        occurring after the date of this Agreement of a nature that would
        constitute a Change in Control under that certain Employment Agreement,
        dated as of May

<PAGE>

        17, 2002 between the Company and James P. Jimirro

               (b) "Corporate Status" describes the status of a person who is or
        was a director, officer, employee or agent or fiduciary of the Company
        or of any other corporation, partnership, joint venture, trust, employee
        benefit plan or other enterprise for which such person is or was serving
        in such capacity at the express request of the Company.

               (c) "Disinterested Director" means a director of the Company who
        is not and was not a party to the Proceeding in respect of which
        indemnification is sought by Indemnitee; provided, however, that neither
        Indemnitee nor Daniel Laikin shall be "Disinterested Directors"
        hereunder, and both Indemnitee and Daniel Laikin shall recuse themselves
        from any determinations made or to be made by the Board of Directors
        pursuant to this Agreement.

               (d) "Enterprise" shall mean the Company and any other
        corporation, partnership, joint venture, trust, employee benefit plan or
        other enterprise of which Indemnitee is or was serving at the express
        written request of the Company as a director, officer, employee, agent
        or fiduciary.

               (e) "Expenses" shall include all reasonable attorneys' fees,
        retainers, court costs, transcript costs, fees of experts, fees of
        accountants, witness fees, travel expenses, duplicating costs, printing
        and binding costs, telephone charges, postage, delivery service fees,
        and all other disbursements or expenses of the types customarily
        incurred in connection with prosecuting, defending, preparing to
        prosecute or defend, investigating, participating, or being or preparing
        to be a witness in a Proceeding.

               (f) "Independent Counsel" means a law firm of national
        reputation, that is experienced in matters of California corporation law
        and neither presently is, nor in the past five years has been, retained
        to represent:

                        (i) the Company or Indemnitee in any matter including
                with respect to matters concerning other indemnitees under
                similar indemnification agreements, or

                        (ii) any other party to the Proceeding giving rise to a
                claim for indemnification hereunder. Notwithstanding the
                foregoing, the term "Independent Counsel" shall not include any
                person who, under the applicable standards of professional
                conduct then prevailing, would have a conflict of interest in
                representing either the Company or Indemnitee in an action to
                determine Indemnitee's rights under this Agreement. Without
                limiting the foregoing, the term "Independent Counsel" shall not
                include Greenberg Traurig LLP or any other law firm in which
                John C. Kirkland is a partner or with which he is otherwise
                affiliated or associated. The Company agrees to pay the
                reasonable fees of the Independent Counsel referred to above and
                to fully indemnify such counsel against any and all Expenses,
                claims, liabilities and damages arising our of or relating to
                this

<PAGE>

                Agreement or its engagement pursuant hereto.

               (g) "Proceeding" includes any threatened, pending or completed
        action, suit, arbitration, alternate dispute resolution mechanism,
        investigation, inquiry, administrative hearing or any other actual,
        threatened or completed proceeding, whether brought by or in the right
        of the Company or otherwise and whether civil, criminal, administrative
        or investigative, in which Indemnitee was, is or will be involved as a
        party or otherwise, by reason of the fact that Indemnitee is or was an
        officer and/or a director of the Company, by reason of any action taken
        by him or of any inaction on his part while acting as an officer and/or
        a director of the Company, or by reason of the fact that he is or was
        serving at the request of the Company as a director, officer, employee
        or agent of another corporation, partnership, joint venture, trust or
        other enterprise; in each case whether or not he is acting or serving in
        any such capacity at the time any liability or expense is incurred for
        which indemnification can be provided under this Agreement, and in each
        case whether or not based on any fact or facts occurring before, on or
        after the date of this Agreement, including one pending before, on or
        after the date of this Agreement, and excluding one initiated by an
        Indemnitee pursuant to Section 8 of this Agreement to enforce his rights
        under this Agreement.

        15. Severability. If any provision or provisions of this Agreement shall
be held by a court of competent jurisdiction to be invalid, void, illegal or
otherwise unenforceable for any reason whatsoever:

               (a) the validity, legality and enforceability of the remaining
        provisions of this Agreement (including without limitation, each portion
        of any section of this Agreement containing any such provision held to
        be invalid, illegal or unenforceable, that is not itself invalid,
        illegal or unenforceable) shall not in any way be affected or impaired
        thereby and shall remain enforceable to the fullest extent permitted by
        law; and

               (b) to the fullest extent possible, the provisions of this
        Agreement (including, without limitation, each portion of any section of
        this Agreement containing any such provision held to be invalid, illegal
        or unenforceable, that is not itself invalid, illegal or unenforceable)
        shall be construed so as to give effect to the intent manifested
        thereby.

        16. Modification and Waiver. No supplement, modification, termination or
amendment of this Agreement shall be binding unless executed in writing by both
of the parties hereto. No waiver of any of the provisions of this Agreement
shall be deemed or shall constitute a waiver of any other provisions hereof
(whether or not similar) nor shall such waiver constitute a continuing waiver.

        17. Notice by Indemnitee. Indemnitee agrees promptly to notify the
Company in writing upon being served with any summons, citation, subpoena,
complaint, indictment, information or other document relating to any Proceeding
or matter which may be subject to indemnification covered hereunder. The failure
to so notify the Company shall not

<PAGE>

relieve the Company of any obligation which it may have to the Indemnitee under
this Agreement or otherwise.

        18. Notices. All notices, requests, demands and other communications
hereunder stall be in writing and shall be deemed to have been duly given if (i)
delivered by hand and receipted for by the party to whom said notice or other
communication shall have been directed, or (ii) mailed by certified or
registered mail with postage prepaid, on the third business day after the date
on which it is so mailed:

               (a) If to Indemnitee, to:
                   James P. Jimirro
                   10787 Wilshire Blvd., Suite 1702
                   Los Angeles, California 90024

               (b) If to the Company, to:
                   J2 Communications
                   111 Monument Circle, Suite 3680
                   Indianapolis, Indiana 46204
                   Attention: Timothy S. Durham

or to such other address as may have been furnished in writing to Indemnitee by
the Company or in writing to the Company by Indemnitee, as the case may be.

        19. Identical Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall for all purposes be deemed to be an
original but all of which together shall constitute one and the same Agreement.
Only one such counterpart signed by the party against whom enforceability is
sought needs to be produced to evidence the existence of this Agreement.

        20. Headings. The headings of the paragraphs of this Agreement are
inserted for convenience only and shall not be deemed to constitute part of this
Agreement or to affect the construction thereof.

        21. Governing Law. The parties agree that this Agreement shall be
governed by, and construed and enforced in accordance with, the laws of the
State of California without application of the conflict of laws principles
thereof.

        22. Gender. Use of the masculine pronoun shall be deemed to include
usage of the feminine pronoun where appropriate.

<PAGE>

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

                                    COMPANY:

                                    J2 COMMUNICATIONS,
                                    a California corporation
                                    By: _______________________________
                                    Name: James P. Jimirro
                                    Title: President

                                    INDEMNITEE:

                                    -----------------------------------
                                    JAMES P. JIMIRRO

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