Common use of Compensation, Benefits and Reviews Clause in Contracts

Compensation, Benefits and Reviews. Subject to all the other terms of this Agreement, in connection with Employee's performance of the Services, Employer shall: (a) pay Employee's salary by check in equal installments in accordance with Employer's regular salary payment schedule, which shall be paid at the rate (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by federal, state and local law) of $165,000 per year retroactive to March 20, 2011 through December 31, 2011, then $195,000 per year from January 1, 2012 through December 31, 2012, then $225,000 per year from January 1, 2013 through December 31, 2014. Employee’s salary for the remaining term of this Agreement shall be set by the Board of Directors, but shall not increase less than five percent (5%) per annum. (b) at the sole option of the Board of Directors of Company, pay Employee a year-end performance bonus in the form of cash, options to purchase shares, or shares of the Company’s common stock or a combination thereof, but in no event shall the dollar value of the combined bonus be less than four and one-half percent (4.5%) of EBITDA of the Company (earnings before interest, depreciation, taxes and amortization) for the immediately preceding fiscal year, as long as that figure is positive, up to 100% of the base salary for the annual period for which the bonus is earned. The bonus amount may be increased to in excess of 100% of base salary at the discretion of the Board of Directors. Such bonuses are payable within ninety (90) days of issuance of audited financial statements of the Company. (c) grant an option to Employee in the approved form of grant notice for the Company’s 2008 Stock Option Plan (the “Option”) to purchase up to 1,000,000 shares of the Company’s no par value common stock, the terms (including, without limitation, the option price and the time of vesting of the shares issuable pursuant thereto) of which Option shall be governed by the face thereof subject to availability and provisions of Employer’s 2008 Stock Option Plan (the “Plan”) in effect or as amended, a copy of which has been provided to Employer. The Option shall be granted on the Effective date and vest as to 250,000 shares on April 1, 2011, and as to 250,000 shares on April 1st of each following year during the term. The exercise price of the Option shall be the greater of $0.44 per share. The Option shall be exercisable for ten (10) years from date of grant, and shall be treated as a Non-qualified Stock Option (NSO) as such term is defined in section 422 of the Internal Revenue Code when allowed by law. Upon termination, the Option shall expire as to all vested but unexercised shares and as to all unvested shares in accordance with the Stock Option Grant Notice, unless the Option has otherwise expired or Employee is terminated for Cause, in which case the Option must be exercised in accordance with the Plan, which currently calls for exercise within ninety (90) days of termination. In the event of a Change of Control that results in the termination of Employee’s employment prior to the Expiration Date, the vesting of the Option shall accelerate and vest in full. A Change of Control means the sale of all or substantially all of the Company’s assets, a merger or consolidation resulting in securities representing 50% of the combined voting power of the outstanding common stock being transferred to persons who are different from the holders immediately preceding the transaction, the acquisition (directly or indirectly) of 50% of the total combined voting power of the common stock pursuant to a tender or exchange offer, or a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election. Employee hereby grants a right of first refusal to the Company on all shares underlying and purchased by Employee pursuant to the Option (the “Shares”) in the event of Employee’s Termination for Cause pursuant to Paragraph 3 of this Agreement. The purchase price for the Shares under this right of first refusal shall be the bid price of the common stock on the date of termination of Employee’s employment hereunder (the “Purchase Price”). Prior to selling any of the Shares, Employee shall provide the Company with written notice (the “Notice”) stating: (i) the Employee’s bona fide intention to sell or otherwise transfer the Shares, the number of Shares being transferred (the “Offered Shares”), the identity of the proposed transferee, and the terms and conditions of the proposed transfer. The Company shall have thirty (30) days after receipt of the Notice (“Exercise Period”) to elect to purchase all or less than all of the Offered Shares at the Purchase Price by delivery written notice of exercise of its right of purchase hereunder to Employee (“Notice of Exercise”). Payment of the Purchase Price shall be made in cash (by check or wire transfer) within thirty (30) days after delivery of the Company’s Notice of Exercise. If less than all of the Offered Shares are purchased by the Company within the Exercise Period, Employee may sell or otherwise transfer the remaining Offered Shares to the proposed buyer at a minimum of the price included in the Notice within sixty (60) days after the expiration of the Exercise Period. To the extent the Offered Shares are not so sold, a new Notice shall be given to the Company and the Company shall again be offered the right of first refusal before any of the Shares may be sold or otherwise transferred. (d) grant Employee the option to participate in all of the benefit plans offered by Employer to its Employees generally, including without limitation, insurance plans, 401(k) and other savings plans, Section 125 (cafeteria) and similar pre-tax expense plans, etc., in existence or established during the term. (e) grant Employee private health care insurance for Employee and Employee’s dependents, either a cellular telephone or a cellular telephone reimbursement, computer laptop or similar devices, an automobile allowance of $11,400.00 per annum payable in equal installments in accordance with the Employers normal payroll payment schedule and subject to deductions required by federal, state and local law, and such other benefits as Employer shall determine to provide to any of its most senior executives from time to time. (f) reimburse Employee for all reasonable travel, meals, lodging, communications, entertainment and other business expenses incurred by Employee in connection with Employee’s performance under this Agreement subject to the Company’s expense reimbursement policy. Company shall indemnify Employee for all lawful acts committed in course and scope of employment to fullest extent allowed by law in accordance with the Company’s Articles of Incorporation and Bylaws. (g) grant Employee four (4) weeks' vacation with pay for each twelve-month period, taken at times agreed with Employer, plus holidays observed by Company.

Compensation, Benefits and Reviews. Subject to all the other terms of this Agreement, in connection with Employee's performance of the Services, Employer shall: (a) pay Employee's salary by check twice per month in equal installments in accordance with Employer's regular salary payment schedule, which shall be paid at the rate (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by federal, state and local law) of $165,000 150,000 per year retroactive to March 20, 2011 through December 31, 2011, then $195,000 per year from January 1, 2012 through December 31, 2012, then $225,000 per year from January 1, 2013 through December 31, 2014. Employee’s salary for the remaining term of this Agreement shall be set by the Board of Directors, but shall not increase less than five percent (5%) per annumyear. (b) at the sole option of the Board of Directors of Company, pay Employee a year-end performance bonus in the form of cash, options to purchase shares, cash or shares of the Company’s common stock or a combination thereofGenius Products, but in no event shall the dollar value of the combined bonus be less than four and one-half percent (4.5%) of EBITDA of the Company (earnings before interest, depreciation, taxes and amortization) for the immediately preceding fiscal year, as long as that figure is positive, up to 100% of the base salary for the annual period for which the bonus is earned. The bonus amount may be increased to in excess of 100% of base salary at the discretion of the Board of Directors. Such bonuses are payable within ninety (90) days of issuance of audited financial statements of the CompanyInc. Common Stock. (c) grant an option to Employee in the approved form of grant notice for the Company’s 2008 Stock Option Plan ANNEX B hereto (the “Option”"Options") to purchase up to 1,000,000 450,000 shares of the Company’s no par value common stockGenius Products, Inc. Common Stock, the terms (including, without limitation, the option price and the time of vesting of the shares issuable pursuant thereto) of which Option Options shall be governed by the face thereof subject except to availability and provisions of the extent such terms are superseded by Employer’s 2008 Stock Option Plan (the “Plan”) 's stock option plan currently in effect or as amendedeffect, a copy of which has been provided to Employer. The Option shall be granted on the Effective date and vest is attached hereto as to 250,000 shares on April 1, 2011, and as to 250,000 shares on April 1st of each following year during the term. The exercise price of the Option shall be the greater of $0.44 per share. The Option shall be exercisable for ten (10) years from date of grant, and shall be treated as a Non-qualified Stock Option (NSO) as such term is defined in section 422 of the Internal Revenue Code when allowed by law. Upon termination, the Option shall expire as to all vested but unexercised shares and as to all unvested shares in accordance with the Stock Option Grant Notice, unless the Option has otherwise expired or Employee is terminated for Cause, in which case the Option must be exercised in accordance with the Plan, which currently calls for exercise within ninety (90) days of termination. In the event of a Change of Control that results in the termination of Employee’s employment prior to the Expiration Date, the vesting of the Option shall accelerate and vest in full. A Change of Control means the sale of all or substantially all of the Company’s assets, a merger or consolidation resulting in securities representing 50% of the combined voting power of the outstanding common stock being transferred to persons who are different from the holders immediately preceding the transaction, the acquisition (directly or indirectly) of 50% of the total combined voting power of the common stock pursuant to a tender or exchange offer, or a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election. Employee hereby grants a right of first refusal to the Company on all shares underlying and purchased by Employee pursuant to the Option (the “Shares”) in the event of Employee’s Termination for Cause pursuant to Paragraph 3 of this Agreement. The purchase price for the Shares under this right of first refusal shall be the bid price of the common stock on the date of termination of Employee’s employment hereunder (the “Purchase Price”). Prior to selling any of the Shares, Employee shall provide the Company with written notice (the “Notice”) stating: (i) the Employee’s bona fide intention to sell or otherwise transfer the Shares, the number of Shares being transferred (the “Offered Shares”), the identity of the proposed transferee, and the terms and conditions of the proposed transfer. The Company shall have thirty (30) days after receipt of the Notice (“Exercise Period”) to elect to purchase all or less than all of the Offered Shares at the Purchase Price by delivery written notice of exercise of its right of purchase hereunder to Employee (“Notice of Exercise”). Payment of the Purchase Price shall be made in cash (by check or wire transfer) within thirty (30) days after delivery of the Company’s Notice of Exercise. If less than all of the Offered Shares are purchased by the Company within the Exercise Period, Employee may sell or otherwise transfer the remaining Offered Shares to the proposed buyer at a minimum of the price included in the Notice within sixty (60) days after the expiration of the Exercise Period. To the extent the Offered Shares are not so sold, a new Notice shall be given to the Company and the Company shall again be offered the right of first refusal before any of the Shares may be sold or otherwise transferred.ANNEX C. (d) grant Employee the option to participate in all of the benefit plans offered by Employer to its Employees generally, including without limitation, insurance plans, 401(k) and other savings plans, Section 125 (cafeteria) and similar pre-tax expense plans, etc., in existence or established during . Employee understands that Employer has only a Blue Cross PPO health plan and no other benefit plan as of the termdate of this Agreement. (e) grant Employee private health care insurance for Employee and Employee’s 's dependents, either a cellular telephone or a cellular telephone reimbursementallowance of up to $200 per month based on actual usage, computer laptop or computers and similar devices, an automobile allowance of $11,400.00 2,250 per annum payable in equal installments in accordance with the Employers normal payroll payment schedule and subject to deductions required by federal, state and local lawquarterly period, and such other benefits as Employer shall determine to provide to any of its most senior executives from time to timetime (in each case subject to adjustment by the mutual consent of Employer and Employee and payable quarterly in cash or, at the sole option of Employer, in the form of Employer common stock valued based on the average price thereof during the immediately preceding quarterly period). (f) reimburse Employee for all reasonable travel, meals, lodging, communications, entertainment and other business expenses incurred by Employee in connection with Employee’s 's performance under this Agreement subject to the Company’s expense reimbursement policy. Company shall indemnify Employee for all lawful acts committed in course and scope of employment to fullest extent allowed by law in accordance with the Company’s Articles of Incorporation and BylawsAgreement. (g) grant Employee four (4) weeks' vacation with pay for each twelve-month period, taken at times agreed with Employer, plus holidays observed by Company.

Compensation, Benefits and Reviews. Subject to all the other terms of this Agreement, in connection with Employee's performance of the Services, Employer shall: (a) pay Pay Employee's salary by check or direct deposit twice per month in equal installments in accordance with Employer's regular salary payment schedule, which shall be paid at the rate of $9,375 (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by federal, state and local law) of semi-monthly. b) Pay Employee a quarterly performance bonus (if any), not to exceed $165,000 per year retroactive to March 20100,000 in the aggregate, 2011 through December 31, 2011, then $195,000 per year from January 1, 2012 through December 31, 2012, then $225,000 per year from January 1, 2013 through December 31, 2014. Employee’s salary for based on specific performance targets set forth in the remaining term of this Agreement shall be set bonus plan established by the Board board of Directorsdirectors and attached hereto as Exhibit C. c) Employee will be granted 165,000 non-qualified stock options to vest in equal installments of 1/36 per month over a three (3) year period, but shall not increase less than five percent (5%) per annum. (b) starting on the date of the grant, and until such options are vested in full. The stock options’ exercise price will be priced at the sole closing share price on the date of grant and will be subject to Employee signing Employer’s form stock option of the Board of Directors of Company, pay Employee a year-end performance bonus in the form of cash, options to purchase shares, or shares of the Company’s common stock or a combination thereof, but in no event shall the dollar value of the combined bonus be less than four and one-half percent (4.5%) of EBITDA of the Company (earnings before interest, depreciation, taxes and amortization) for the immediately preceding fiscal year, as long as that figure is positive, up to 100% of the base salary for the annual period for which the bonus is earnedagreement. The bonus amount may be increased to in excess of 100% of base salary at the discretion of the Board of Directors. Such bonuses are payable within ninety (90) days of issuance of audited financial statements of the Company. (c) grant an option to Employee in the approved form of grant notice for the Company’s 2008 Stock Option Plan (the “Option”) to purchase up to 1,000,000 shares of the Company’s no par value common stock, the terms (including, without limitation, the option price and the time of vesting of the shares issuable pursuant thereto) of which Option stock options shall be governed by the face thereof subject to availability and provisions of Employer’s 2008 St. Xxxxxxx Software, Inc. 2005 Stock Option Plan (the “Plan”) in effect or as amended, a copy of which has been provided to Employer. The Option shall be granted on the Effective date and vest as to 250,000 shares on April 1, 2011, and as to 250,000 shares on April 1st of each following year during the term. The exercise price of the Option shall be the greater of $0.44 per share. The Option shall be exercisable for ten (10) years from date of grant, and shall be treated as a Non-qualified Stock Option (NSO) as such term is defined in section 422 of the Internal Revenue Code when allowed by law. Upon termination, the Option shall expire as to all vested but unexercised shares and as to all unvested shares in accordance with the Stock Option Grant Notice, unless the Option has otherwise expired or Employee is terminated for Cause, in which case the Option must be exercised in accordance with the Plan, which currently calls for exercise within ninety (90) days of termination. In the event of a Change of Control that results in the termination of Employee’s employment prior to the Expiration Date, the vesting of the Option shall accelerate and vest in full. A Change of Control means the sale of all or substantially all of the Company’s assets, a merger or consolidation resulting in securities representing 50% of the combined voting power of the outstanding common stock being transferred to persons who are different from the holders immediately preceding the transaction, the acquisition (directly or indirectly) of 50% of the total combined voting power of the common stock pursuant to a tender or exchange offer, or a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election. Employee hereby grants a right of first refusal to the Company on all shares underlying and purchased by Employee pursuant to the Option (the “Shares”) in the event of Employee’s Termination for Cause pursuant to Paragraph 3 of this Agreement. The purchase price for the Shares under this right of first refusal shall be the bid price of the common stock on the date of termination of Employee’s employment hereunder (the “Purchase Price”). Prior to selling any of the Shares, Employee shall provide the Company with written notice (the “Notice”) stating: (i) the Employee’s bona fide intention to sell or otherwise transfer the Shares, the number of Shares being transferred (the “Offered Shares”), the identity of the proposed transferee, and the terms and conditions of the proposed transfer. The Company shall have thirty (30) days after receipt of the Notice (“Exercise Period”) to elect to purchase all or less than all of the Offered Shares at the Purchase Price by delivery written notice of exercise of its right of purchase hereunder to Employee (“Notice of Exercise”). Payment of the Purchase Price shall be made in cash (by check or wire transfer) within thirty (30) days after delivery of the Company’s Notice of Exercise. If less than all of the Offered Shares are purchased by the Company within the Exercise Period, Employee may sell or otherwise transfer the remaining Offered Shares to the proposed buyer at a minimum of the price included in the Notice within sixty (60) days after the expiration of the Exercise Period. To the extent the Offered Shares are not so sold, a new Notice shall be given to the Company and the Company shall again be offered the right of first refusal before any of the Shares as it may be sold or otherwise transferredamended from time to time. (d) grant Grant Employee the option to participate in all of the benefit plans offered by Employer to its Employees generallyEmployer, including without limitation, insurance plans, 401(k) and other savings plans, short and long term disability insurance, Section 125 (cafeteria) and similar pre-tax expense plans, holidays, PTO- Personal Time Off, etc., which may be amended from time to time in existence or established during the termEmployer’s discretion. (e) grant Employee private Participate in health care insurance for Employee and Employee’s dependents, either a cellular telephone or a cellular telephone reimbursement, computer laptop or similar devices, an automobile allowance of $11,400.00 per annum payable in equal installments in accordance with the Employers normal payroll payment schedule and subject to deductions required by federal, state and local law, and such other benefits as Employer shall determine to provide to any all of its most senior executives employees from time to time. (f) reimburse Reimburse Employee for all reasonable travel, meals, lodging, communications, entertainment and other business expenses incurred by Employee in connection with Employee’s performance under this Agreement subject to the Company’s expense reimbursement policy. Company shall indemnify Employee for all lawful acts committed in course and scope of employment to fullest extent allowed by law in accordance with the Company’s Articles of Incorporation and Bylawsemployment. (g) grant Grant Employee four (4) weeks' weeks vacation with pay for each twelve-month period, to be taken at times agreed with Employer. Unused vacation shall accrue according to the Employer’s accrued vacation policy, plus holidays observed by Companyas may be amended from time to time.

Compensation, Benefits and Reviews. Subject to all the other terms of this Agreement, in connection with Employee's performance of the Services, Employer shall: (a) pay Employee's salary by check twice per month in equal installments in accordance with Employer's regular salary payment schedule, which shall be paid at the rate (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by federal, state and local law) of $165,000 45,000 per year retroactive to March 20, 2011 through December 31, 2011, then $195,000 per year from January 1, 2012 through December 31, 2012, then $225,000 per year from January 1, 2013 through December 31, 2014. Employee’s salary for the remaining term of this Agreement shall be set by the Board of Directors, but shall not increase less than five percent (5%) per annumyear. (b) at the sole option of the Board of Directors of Company, pay Employee a year-end performance bonus in the form of cash, options to purchase shares, cash or shares of the Company’s common stock or a combination thereofGenius Products, but in no event shall the dollar value of the combined bonus be less than four and one-half percent (4.5%) of EBITDA of the Company (earnings before interest, depreciation, taxes and amortization) for the immediately preceding fiscal year, as long as that figure is positive, up to 100% of the base salary for the annual period for which the bonus is earned. The bonus amount may be increased to in excess of 100% of base salary at the discretion of the Board of Directors. Such bonuses are payable within ninety (90) days of issuance of audited financial statements of the Company.Inc. Common Stock; (c) grant an option to Employee in the approved form of grant notice for the Company’s 2008 Stock Option Plan ANNEX B hereto (the “Option”"Options") to purchase up to 1,000,000 150,000 shares of the Company’s no par value common stockGenius Products, Inc. Common Stock, the terms (including, without limitation, the option price and the time of vesting of the shares issuable pursuant thereto) of which Option Options shall be governed by the face thereof subject except to availability and provisions of the extent such terms are superseded by Employer’s 2008 Stock Option Plan (the “Plan”) 's stock option plan currently in effect or as amendedeffect, a copy of which has been provided to Employer. The Option shall be granted on the Effective date and vest is attached hereto as to 250,000 shares on April 1, 2011, and as to 250,000 shares on April 1st of each following year during the term. The exercise price of the Option shall be the greater of $0.44 per share. The Option shall be exercisable for ten (10) years from date of grant, and shall be treated as a Non-qualified Stock Option (NSO) as such term is defined in section 422 of the Internal Revenue Code when allowed by law. Upon termination, the Option shall expire as to all vested but unexercised shares and as to all unvested shares in accordance with the Stock Option Grant Notice, unless the Option has otherwise expired or Employee is terminated for Cause, in which case the Option must be exercised in accordance with the Plan, which currently calls for exercise within ninety (90) days of termination. In the event of a Change of Control that results in the termination of Employee’s employment prior to the Expiration Date, the vesting of the Option shall accelerate and vest in full. A Change of Control means the sale of all or substantially all of the Company’s assets, a merger or consolidation resulting in securities representing 50% of the combined voting power of the outstanding common stock being transferred to persons who are different from the holders immediately preceding the transaction, the acquisition (directly or indirectly) of 50% of the total combined voting power of the common stock pursuant to a tender or exchange offer, or a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election. Employee hereby grants a right of first refusal to the Company on all shares underlying and purchased by Employee pursuant to the Option (the “Shares”) in the event of Employee’s Termination for Cause pursuant to Paragraph 3 of this Agreement. The purchase price for the Shares under this right of first refusal shall be the bid price of the common stock on the date of termination of Employee’s employment hereunder (the “Purchase Price”). Prior to selling any of the Shares, Employee shall provide the Company with written notice (the “Notice”) stating: (i) the Employee’s bona fide intention to sell or otherwise transfer the Shares, the number of Shares being transferred (the “Offered Shares”), the identity of the proposed transferee, and the terms and conditions of the proposed transfer. The Company shall have thirty (30) days after receipt of the Notice (“Exercise Period”) to elect to purchase all or less than all of the Offered Shares at the Purchase Price by delivery written notice of exercise of its right of purchase hereunder to Employee (“Notice of Exercise”). Payment of the Purchase Price shall be made in cash (by check or wire transfer) within thirty (30) days after delivery of the Company’s Notice of Exercise. If less than all of the Offered Shares are purchased by the Company within the Exercise Period, Employee may sell or otherwise transfer the remaining Offered Shares to the proposed buyer at a minimum of the price included in the Notice within sixty (60) days after the expiration of the Exercise Period. To the extent the Offered Shares are not so sold, a new Notice shall be given to the Company and the Company shall again be offered the right of first refusal before any of the Shares may be sold or otherwise transferred.ANNEX C. (d) grant Employee the option to participate in all of the benefit plans offered by Employer to its Employees generally, including without limitation, insurance plans, 401(k) and other savings plans, Section 125 (cafeteria) and similar pre-tax expense plans, etc., in existence or established during . Employee understands that Employer has only a Blue Cross PPO health plan and no other benefit plan as of the termdate of this Agreement. (e) grant Employee private health care insurance for Employee and Employee’s dependents, either a cellular telephone or a cellular telephone reimbursement, computer laptop or similar devices, an automobile allowance of $11,400.00 per annum payable in equal installments in accordance with the Employers normal payroll payment schedule and subject to deductions required by federal, state and local law, 's dependents and such other benefits as Employer shall determine to provide to any of its most senior executives from time to timetime (in each case subject to adjustment by the mutual consent of Employer and Employee and payable quarterly in cash or, at the sole option of Employer, in the form of Employer common stock valued based on the average price thereof during the immediately preceding quarterly period). (f) reimburse Employee for all reasonable travel, meals, lodging, communications, entertainment and other business expenses incurred by Employee in connection with Employee’s 's performance under this Agreement subject to the Company’s expense reimbursement policy. Company shall indemnify Employee for all lawful acts committed in course and scope of employment to fullest extent allowed by law in accordance with the Company’s Articles of Incorporation and BylawsAgreement. (g) grant Employee four (4) weeks' vacation with pay for each twelve-month period, taken at times agreed with Employer, plus holidays observed by Company.

Compensation, Benefits and Reviews. Subject to all the other terms of this Agreement, in connection with Employee's performance of the Services, Employer shall: (a) pay Employee's salary by check in equal installments in accordance with Employer's regular salary payment schedule, which shall be paid at the rate (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by federal, state and local law) of $165,000 per year retroactive to March 20, 2011 through December 31, 2011, then $195,000 per year from January 1, 2012 through December 31, 2012, then $225,000 190,000 per year from January 1, 2013 through December 31, 2013, then $215,000 per year from January 1, 2014 through December 31, 2014. Employee’s salary for the remaining term of this Agreement shall be set by the Board of Directors, but shall not increase less than five percent (5%) per annum. (b) at the sole option of the Board of Directors of Company, pay Employee a year-end performance bonus in the form of cash, options to purchase shares, or shares of the Company’s common stock or a combination thereofCommon Stock, but in no event shall the dollar value of the combined bonus be less than four and one-half two percent (4.52.0%) of EBITDA of the Company (earnings before interest, depreciation, taxes and amortization) for the immediately preceding fiscal year), as long as that figure is positive, up to 100% of the base salary for the annual period for which the bonus is earned. The bonus amount may be increased to in excess of 100% of base salary at the discretion of the Board of Directors. Such bonuses are payable within ninety (90) days of issuance of audited financial statements of the Company. (c) grant an option to Employee in the approved form of grant notice for the Company’s 2008 Stock Option Plan Annex B hereto (the “OptionOptions”) to purchase up purchase, in addition to 1,000,000 all other grants previously issued, 200,000 shares of the Company’s no par value common stockGenius Brands International, Inc. Common Stock, the terms (including, without limitation, the option price and the time of vesting of the shares issuable pursuant thereto) of which Option Options shall be governed by the face thereof subject to availability and provisions of Employer’s 2008 Stock Option Plan (the “Plan”) in effect or as amended, a copy of which has is attached hereto as Annex C. Such options have been provided to Employer. The Option granted or shall be granted on the Effective date and vest as to 250,000 shares on April 1Dec. 31, 2011, and as to 250,000 shares on April 1st of each following year during the term2014. The exercise purchase price of the Option stock options granted under this paragraph shall be the greater of $0.44 per shareshare or one hundred ten percent (110%) of the average trading price of shares of the Company for the previous five (5) trading days before the date of grant. The Option Any stock options granted shall be exercisable for ten five (105) years from date of grant, and shall be treated as a Non-qualified Qualified Stock Option Options (NSOISO) as such term is defined in section 422 of the Internal Revenue Code when allowed by law. Upon termination, the Option Options granted but not exercised or expired upon termination shall expire have an expiration as to all vested but unexercised shares and as to all unvested shares in accordance with determined by the Stock Option Grant Notice, unless the Option has otherwise expired or Employee is terminated for Cause, in which case the Option must they may be exercised in accordance with the PlanEmployer’s then existing stock option plan, which currently calls for exercise within ninety (90) days of termination. In the event of a Change of Control that results in the termination of Employee’s employment prior to the Expiration Date, the vesting of the Option Options shall accelerate and vest in full. A Change of Control means the sale of all or substantially all of the Company’s assets, a merger or consolidation resulting in securities representing 50% of the combined voting power of the outstanding common stock being transferred to persons who are different from the holders immediately preceding the transaction, the acquisition (directly or indirectly) of 50% of the total combined voting power of the common stock pursuant to a tender or exchange offer, or a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election. Employee hereby grants a right of first refusal to the Company on all shares underlying and purchased by Employee pursuant to the Option (the “Shares”) in the event of Employee’s Termination for Cause pursuant to Paragraph 3 of this Agreement. The purchase price for the Shares under this right of first refusal shall be the bid price of the common stock on the date of termination of Employee’s employment hereunder (the “Purchase Price”). Prior to selling any of the Shares, Employee shall provide the Company with written notice (the “Notice”) stating: (i) the Employee’s bona fide intention to sell or otherwise transfer the Shares, the number of Shares being transferred (the “Offered Shares”), the identity of the proposed transferee, and the terms and conditions of the proposed transfer. The Company shall have thirty (30) days after receipt of the Notice (“Exercise Period”) to elect to purchase all or less than all of the Offered Shares at the Purchase Price by delivery written notice of exercise of its right of purchase hereunder to Employee (“Notice of Exercise”). Payment of the Purchase Price shall be made in cash (by check or wire transfer) within thirty (30) days after delivery of the Company’s Notice of Exercise. If less than all of the Offered Shares are purchased by the Company within the Exercise Period, Employee may sell or otherwise transfer the remaining Offered Shares to the proposed buyer at a minimum of the price included in the Notice within sixty (60) days after the expiration of the Exercise Period. To the extent the Offered Shares are not so sold, a new Notice shall be given to the Company and the Company shall again be offered the right of first refusal before any of the Shares may be sold or otherwise transferred. (d) grant Employee the option to participate in all of the benefit plans offered by Employer to its Employees generally, including without limitation, insurance plans, 401(k) and other savings plans, Section 125 (cafeteria) and similar pre-tax expense plans, etc., in existence or established during the term. (e) grant Employee private health care insurance for Employee and Employee’s dependents, either a cellular telephone or a cellular telephone reimbursement, computer laptop or similar devices, an automobile allowance of $11,400.00 per annum payable in equal installments in accordance with the Employers normal payroll payment schedule and subject to deductions required by federal, state and local law, and such other benefits as Employer shall determine to provide to any of its most senior executives from time to time. (f) reimburse Employee for all reasonable travel, meals, lodging, communications, entertainment and other business expenses incurred by Employee in connection with Employee’s performance under this Agreement subject to the Company’s expense reimbursement Expense Reimbursement policy. Company shall indemnify Employee for all lawful acts committed in course and scope of employment to fullest extent allowed by law in accordance with the Company’s Articles of Incorporation and Bylawslaw. (g) grant Employee four (4) weeks' vacation with pay for each twelve-month period, taken at times agreed with Employer, plus holidays observed by Company. Unused vacation time shall accrue in accordance with Company policy, as may be amended from time to time, but in no event shall accrued vacation exceed six (6) weeks.

Compensation, Benefits and Reviews. Subject to all the other terms of this Agreement, in connection with Employee's performance of the Services, Employer shall: (a) pay Pay Employee's salary by check twice per month in equal installments in accordance with Employer's regular salary payment schedule, which shall be paid at the rate (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by federal, state and local law) of $165,000 16,667 per year retroactive to March 20, 2011 through December 31, 2011, then $195,000 per year from January month commencing on October 1, 2012 through December 31, 2012, then $225,000 per year from January 1, 2013 through December 31, 2014. Employee’s salary for the remaining term of this Agreement shall be set by the Board of Directors, but shall not increase less than five percent (5%) per annum2005. (b) at At the sole option discretion of the Board of Directors of CompanyEmployer, Employer may pay Employee a year-end performance bonus in the form of cash, options to purchase shares, cash or shares of the Company’s common stock or a combination thereofGenius Products, but in no event shall the dollar value of the combined bonus be less than four and one-half percent (4.5%) of EBITDA of the Company (earnings before interest, depreciation, taxes and amortization) for the immediately preceding fiscal year, as long as that figure is positive, up to 100% of the base salary for the annual period for which the bonus is earned. The bonus amount may be increased to in excess of 100% of base salary at the discretion of the Board of Directors. Such bonuses are payable within ninety (90) days of issuance of audited financial statements of the CompanyInc. Common Stock. (c) grant an option to Employee in the approved form of grant notice for the Company’s 2008 Stock Option Plan (the “Option”) to purchase up to 1,000,000 shares of the Company’s no par value common stock, the terms (including, without limitation, the option price and the time of vesting of the shares issuable pursuant thereto) of which Option shall be governed by the face thereof subject to availability and provisions of Employer’s 2008 Stock Option Plan (the “Plan”) in effect or as amended, a copy of which has been provided to Employer. The Option shall be granted on the Effective date and vest as to 250,000 shares on April 1, 2011, and as to 250,000 shares on April 1st of each following year during the term. The exercise price of the Option shall be the greater of $0.44 per share. The Option shall be exercisable for ten (10) years from date of grant, and shall be treated as a Non-qualified Stock Option (NSO) as such term is defined in section 422 of the Internal Revenue Code when allowed by law. Upon termination, the Option shall expire as to all vested but unexercised shares and as to all unvested shares in accordance with the Stock Option Grant Notice, unless the Option has otherwise expired or Employee is terminated for Cause, in which case the Option must be exercised in accordance with the Plan, which currently calls for exercise within ninety (90) days of termination. In the event of a Change of Control that results in the termination of Employee’s employment prior to the Expiration Date, the vesting of the Option shall accelerate and vest in full. A Change of Control means the sale of all or substantially all of the Company’s assets, a merger or consolidation resulting in securities representing 50% of the combined voting power of the outstanding common stock being transferred to persons who are different from the holders immediately preceding the transaction, the acquisition (directly or indirectly) of 50% of the total combined voting power of the common stock pursuant to a tender or exchange offer, or a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election. Employee hereby grants a right of first refusal to the Company on all shares underlying and purchased by Employee pursuant to the Option (the “Shares”) in the event of Employee’s Termination for Cause pursuant to Paragraph 3 of this Agreement. The purchase price for the Shares under this right of first refusal shall be the bid price of the common stock on the date of termination of Employee’s employment hereunder (the “Purchase Price”). Prior to selling any of the Shares, Employee shall provide the Company with written notice (the “Notice”) stating: (i) the Employee’s bona fide intention to sell or otherwise transfer the Shares, the number of Shares being transferred (the “Offered Shares”), the identity of the proposed transferee, and the terms and conditions of the proposed transfer. The Company shall have thirty (30) days after receipt of the Notice (“Exercise Period”) to elect to purchase all or less than all of the Offered Shares at the Purchase Price by delivery written notice of exercise of its right of purchase hereunder to Employee (“Notice of Exercise”). Payment of the Purchase Price shall be made in cash (by check or wire transfer) within thirty (30) days after delivery of the Company’s Notice of Exercise. If less than all of the Offered Shares are purchased by the Company within the Exercise Period, Employee may sell or otherwise transfer the remaining Offered Shares to the proposed buyer at a minimum of the price included in the Notice within sixty (60) days after the expiration of the Exercise Period. To the extent the Offered Shares are not so sold, a new Notice shall be given to the Company and the Company shall again be offered the right of first refusal before any of the Shares may be sold or otherwise transferred. (d) grant Employee the option to participate in all of the benefit plans offered by Employer to its Employees Senior Executives generally, on the same terms and conditions, including without limitation, insurance plans, 401(k) and other savings plans, short and long term disability insurance, Section 125 (cafeteria) and similar pre-tax expense plans, holidays, sick leave, etc., which may be amended from time to time in existence or established during Employer’s discretion. Employee understands that Employer has only a Blue Cross PPO health plan and no other benefit plan as of the termdate of this Agreement. (ed) grant Grant Employee private health care insurance for Employee and Employee’s dependents, either a cellular telephone or a cellular telephone reimbursement, computer laptop or similar devices, an automobile allowance of $11,400.00 per annum payable in equal installments in accordance with the Employers normal payroll payment schedule and subject to deductions required by federal, state and local law, and such other benefits as Employer shall determine to provide to any all of its most senior executives management employees from time to time. (fe) reimburse Reimburse Employee for all reasonable travel, meals, lodging, communications, entertainment and other business expenses incurred by Employee in connection with Employee’s performance under this Agreement subject to the Company’s expense reimbursement policy. Company shall indemnify Employee for all lawful acts committed in course and scope of employment to fullest extent allowed by law in accordance with the Company’s Articles of Incorporation and BylawsAgreement. (gf) grant Grant Employee four three (43) weeks' vacation with pay for each twelve-month period, taken at times agreed with Employer. Unused vacation shall accrue to a maximum of two times the annual accrual (for example a maximum accrual of six (6) weeks if employee earns three (3) weeks vacation per year.) (g) Pay Employee an automobile allowance, plus holidays observed which shall be paid at the rate (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by Companyfederal, state and local law) of $800.00 per month commencing on the first day of employment. (h) Employer will recommend to the Board of Directors that Employee be granted 225,000 stock options to vest in three equal installments of 75,000 stock options per year, with the initial grant of stock options to be granted on the date of grant. The stock options’ exercise price will be priced at the closing share price on the date of grant and will be subject to Employee signing Employer’s form stock option agreement. While Employer has every belief these stock options will be approved, Employee acknowledges that this offer of stock options is contingent on Employer’s Board of Directors’ approval. The Options shall be governed by the stock option plan, as it may be amended from time to time.

Compensation, Benefits and Reviews. Subject to all the other terms of this Agreement, in connection with Employee's performance of the Services, Employer shall: (a) pay a. Pay Employee's salary by check or direct deposit twice per month in equal installments in accordance with Employer's regular salary payment schedule, which shall be paid at the rate of $7,916.67 (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by federal, state and local law) of $165,000 per year retroactive to March 20, 2011 through December 31, 2011, then $195,000 per year from January 1, 2012 through December 31, 2012, then $225,000 per year from January 1, 2013 through December 31, 2014. Employee’s salary for the remaining term of this Agreement shall be set by the Board of Directors, but shall not increase less than five percent (5%) per annumsemi-monthly. (b) at the sole option of the Board of Directors of Company, pay b. Pay Employee a year-end performance bonus in the form of cash, options to purchase shares, or shares of the Company’s common stock or a combination thereof, but in no event shall the dollar value of the combined bonus be less than four and one-half percent (4.5%) of EBITDA of the Company (earnings before interest, depreciation, taxes and amortization) for the immediately preceding fiscal year, as long as that figure is positive, up to 100% of the base salary for the annual period for which the bonus is earned. The bonus amount may be increased to in excess of 100% of base salary at the discretion of the Board of Directors. Such bonuses are payable within ninety (90) days of issuance of audited financial statements of the Company. (c) grant an option to Employee in the approved form of grant notice for the Company’s 2008 Stock Option Plan (the “Option”) to purchase up to 1,000,000 shares of the Company’s no par value common stock, monthly commission on sales based on the terms and conditions set forth in a then current Sales Variable (including, without limitation, the option price and the time of vesting of the shares issuable pursuant theretoCommission) of which Option shall be governed by the face thereof subject to availability and provisions of Employer’s 2008 Stock Option Plan Compensation plan (the “Plan”) in effect established by the board of directors or a committee of the board of directors, as amendedsuch Plan may be amended by the board of directors, a copy of which has been provided or its committee, from time to time. Attached hereto as Exhibit C is the current Plan for Q3 0000- X0 0000. c. Subject to Employer’s board of directors’ approval, Employee will be granted 250,000 stock options (the “Grant”). The Option Grant will vest over a four (4) year period with one quarter (1/4) vesting on the first anniversary of the date of the grant and the remainder three quarters (3/4) vesting over the remaining three (3) years on a monthly basis thereafter (such shares to vest on the first day of each month thereafter until such shares are vested in full). The stock options’ exercise price will be priced at the closing share price on the date of grant and will be subject to Employee first signing Employer’s form stock option agreement. The Grant shall be granted on the Effective date governed by EdgeWave’s 2010 Employee, Director and vest as to 250,000 shares on April 1, 2011, and as to 250,000 shares on April 1st of each following year during the term. The exercise price of the Option shall be the greater of $0.44 per share. The Option shall be exercisable for ten (10) years from date of grant, and shall be treated as a Non-qualified Stock Option (NSO) as such term is defined in section 422 of the Internal Revenue Code when allowed by law. Upon termination, the Option shall expire as to all vested but unexercised shares and as to all unvested shares in accordance with the Stock Option Grant Notice, unless the Option has otherwise expired or Employee is terminated for Cause, in which case the Option must be exercised in accordance with the Consultant Equity Incentive Plan, which currently calls for exercise within ninety as may be amended from time to time (90) days or at the discretion of terminationEmployer, under a similar plan or outside of a stock option or restricted share plan). In the event of a Change of Control that results (as defined below) or resignation for “good reason (defined below) then subject to You signing a general release of all claims agreement in substantially the termination of Employee’s employment prior to same form attached hereto as Exhibit B, any unvested options will accelerate by 50% and vest immediately upon the Expiration Date, the vesting later date of the Option shall accelerate and vest in full. A Change of Control means the sale of all or substantially all of the Company’s assets, a merger or consolidation resulting in securities representing 50% of the combined voting power of the outstanding common stock being transferred to persons who are different from the holders immediately preceding the transaction, the acquisition (directly or indirectly) of 50% of the total combined voting power of the common stock pursuant to a tender or exchange offer, or a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before your resignation for “Good Reason” and the date of the appointment or election. Employee hereby grants a right of first refusal to the Company on all shares underlying Release Agreement is signed and purchased by Employee pursuant to the Option (the “Shares”) in the event of Employee’s Termination for Cause pursuant to Paragraph 3 of this Agreement. The purchase price for the Shares under this right of first refusal shall be the bid price of the common stock on the date of termination of Employee’s employment hereunder (the “Purchase Price”). Prior to selling any of the Shares, Employee shall provide the Company with written notice (the “Notice”) stating: (i) the Employee’s bona fide intention to sell or otherwise transfer the Shares, the number of Shares being transferred (the “Offered Shares”), the identity of the proposed transferee, and the terms and conditions of the proposed transfer. The Company shall have thirty (30) days after receipt of the Notice (“Exercise Period”) to elect to purchase all or less than all of the Offered Shares at the Purchase Price by delivery written notice of exercise of its right of purchase hereunder to Employee (“Notice of Exercise”). Payment of the Purchase Price shall be made in cash (by check or wire transfer) within thirty (30) days after delivery of the Company’s Notice of Exercise. If less than all of the Offered Shares are purchased by the Company within the Exercise Period, Employee may sell or otherwise transfer the remaining Offered Shares to the proposed buyer at a minimum of the price included in the Notice within sixty (60) days after the expiration of the Exercise Period. To the extent the Offered Shares are not so sold, a new Notice shall be given to the Company and the Company shall again be offered the right of first refusal before any of the Shares may be sold or otherwise transferredbecomes effective. (d) grant x. Xxxxx Employee the option to participate in all of the benefit plans offered by Employer to all of its Employees generallyemployees from time to time, including without limitation, insurance plans, 401(k) and other savings plans, short and long term disability insurance, Section 125 (cafeteria) and similar pre-tax expense plans, holidays, PTO- Personal Time Off, etc., which may be amended from time to time in existence or established during the termEmployer’s discretion. (e) grant Employee private e. Participate in health care insurance for Employee and Employee’s dependents, either a cellular telephone or a cellular telephone reimbursement, computer laptop or similar devices, an automobile allowance of $11,400.00 per annum payable in equal installments in accordance with the Employers normal payroll payment schedule and subject to deductions required by federal, state and local law, and such other benefits as Employer shall determine to provide to any all of its most senior executives employees from time to time. (f) reimburse f. Reimburse Employee for all reasonable travel, meals, lodging, communications, entertainment and other business expenses incurred by Employee in connection the normal course of business in compliance with EmployeeEmployer’s performance under this Agreement subject to policies in effect at the Company’s expense reimbursement policy. Company shall indemnify time. g. Reimburse Employee for all lawful acts committed hotel, rental car, airfare, and other travel related expenses incurred for travel to and from home for the first 90 days of employment, not to exceed $5,500 per month. Reimbursement will be in course and scope compliance with Employer’s policies in effect at the time. If Employee terminates within 12 months from the use of employment to fullest extent allowed this monthly benefit the reimbursement will be recoverable by law in accordance with the Company’s Articles of Incorporation and BylawsEdgeWave. h. Reimburse Employee for reasonable relocation expenses up to $25,000, for which receipts must be provided. If Employee terminates within 12 months from the use of this relocation expense (gthe date the Employee is reimbursed for the relocation) grant the reimbursement will be 100% recoverable to EdgeWave from Employee. x. Xxxxx Employee four three (43) weeks' vacation weeks PTO with pay for each twelve-month period, to be taken at times agreed with Employer. Unused PTO shall accrue according to the Employer’s PTO policy, plus holidays observed by Companyas may be amended from time to time.

Compensation, Benefits and Reviews. Subject to all the other terms of this Agreement, in connection with Employee's performance of the Services, Employer shall: (a) pay Employee's salary by check twice per month in equal installments in accordance with Employer's regular salary payment schedule, which shall be paid at the rate (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by federal, state and local law) of $165,000 173,000 per year retroactive to March 20, 2011 through December 31, 2011, then $195,000 per year from January 1, 2012 through December 31, 2012, then $225,000 per year from January 1, 2013 through December 31, 2014. Employee’s salary for the remaining term of this Agreement shall be set by the Board of Directors, but shall not increase less than five percent (5%) per annumyear. (b) pay Employee a one-time $20,000 signing bonus for entering into this Agreement. (c) at the sole option of the Board of Directors of Company, pay Employee a year-end performance bonus in the form of cash, options to purchase shares, cash or shares of the Company’s common stock or a combination thereofGenius Products, but in no event shall the dollar value of the combined bonus be less than four and one-half percent (4.5%) of EBITDA of the Company (earnings before interest, depreciation, taxes and amortization) for the immediately preceding fiscal year, as long as that figure is positive, up to 100% of the base salary for the annual period for which the bonus is earned. The bonus amount may be increased to in excess of 100% of base salary at the discretion of the Board of Directors. Such bonuses are payable within ninety (90) days of issuance of audited financial statements of the CompanyInc. Common Stock. (cd) grant an option to Employee in the approved form of grant notice for the Company’s 2008 Stock Option Plan ANNEX B hereto (the “Option”"Options") to purchase up to 1,000,000 150,000 shares of the Company’s no par value common stockGenius Products, Inc. Common Stock, the terms (including, without limitation, the option price and the time of vesting of the shares issuable pursuant thereto) of which Option Options shall be governed by the face thereof subject except to availability and provisions of the extent such terms are superseded by Employer’s 2008 Stock Option Plan (the “Plan”) 's stock option plan currently in effect or as amendedeffect, a copy of which has been provided to Employer. is attached hereto as ANNEX C. The Option Options shall be granted on priced at the Effective date and vest as to 250,000 shares on April 1, 2011, and as to 250,000 shares on April 1st of each following year during the term. The exercise closing ask price of the Option shall be the greater of $0.44 per share. The Option shall be exercisable for ten (10) years from date of grant, and shall be treated as a Non-qualified Stock Option (NSO) as such term is defined in section 422 of the Internal Revenue Code when allowed by law. Upon termination, the Option shall expire as to all vested but unexercised shares and as to all unvested shares in accordance with the Stock Option Grant Notice, unless the Option has otherwise expired or Employee is terminated for Cause, in which case the Option must be exercised in accordance with the Plan, which currently calls for exercise within ninety (90) days of termination. In the event of a Change of Control that results in the termination of Employee’s employment prior to the Expiration Date, the vesting of the Option shall accelerate and vest in full. A Change of Control means the sale of all or substantially all of the Company’s assets, a merger or consolidation resulting in securities representing 50% of the combined voting power of the outstanding common stock being transferred to persons who are different from the holders immediately preceding the transaction, the acquisition (directly or indirectly) of 50% of the total combined voting power of the common stock pursuant to a tender or exchange offer, or a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election. Employee hereby grants a right of first refusal to the Company on all shares underlying and purchased by Employee pursuant to the Option (the “Shares”) in the event of Employee’s Termination for Cause pursuant to Paragraph 3 of this Agreement. The purchase price for the Shares under this right of first refusal shall be the bid price of the common stock on the date of termination of Employee’s employment hereunder (the “Purchase Price”). Prior to selling any of the Shares, Employee shall provide the Company with written notice (the “Notice”) stating: (i) the Employee’s bona fide intention to sell or otherwise transfer the Shares, the number of Shares being transferred (the “Offered Shares”), the identity of the proposed transferee, and the terms and conditions of the proposed transfer. The Company shall have thirty (30) days after receipt of the Notice (“Exercise Period”) to elect to purchase all or less than all of the Offered Shares at the Purchase Price by delivery written notice of exercise of its right of purchase hereunder to Employee (“Notice of Exercise”). Payment of the Purchase Price shall be made in cash (by check or wire transfer) within thirty (30) days after delivery of the Company’s Notice of Exercise. If less than all of the Offered Shares are purchased by the Company within the Exercise Period, Employee may sell or otherwise transfer the remaining Offered Shares to the proposed buyer at a minimum of the price included in the Notice within sixty (60) days after the expiration of the Exercise Period. To the extent the Offered Shares are not so sold, a new Notice shall be given to the Company and the Company shall again be offered the right of first refusal before any of the Shares may be sold or otherwise transferredissuance. (de) grant Employee the option to participate in all of the benefit plans offered by Employer to its Employees generally, including without limitation, insurance plans, 401(k) and other savings plans, Section 125 (cafeteria) and similar pre-tax expense plans, etc., in existence or established during . Employee understands that Employer has only a Blue Cross PPO health plan which does not go into effect until 90 days after the termEmployee's first complete day of service to Employer under this Agreement and no other benefit plan as of the date of this Agreement. (ef) grant Employee private health care insurance for Employee and Employee’s dependents's dependents or a subsidy of $680 per month if Employee maintains his own health care insurance, either a cellular telephone or a cellular telephone reimbursementallowance of up to $200 per month based on actual usage, computer laptop or computers and similar devices, an automobile allowance of $11,400.00 2,250 per annum payable in equal installments in accordance with the Employers normal payroll payment schedule and subject to deductions required by federal, state and local lawquarterly period commencing after Employee's first year of service, and such other benefits as Employer shall determine to provide to any of its most senior executives from time to timetime (in each case subject to adjustment by the mutual consent of Employer and Employee and payable quarterly in cash or, at the sole option of Employer, in the form of Employer common stock valued based on the average price thereof during the immediately preceding quarterly period). (fg) reimburse Employee for all reasonable travel, meals, lodging, communications, entertainment and other business expenses incurred by Employee in connection with Employee’s 's performance under this Agreement subject to the Company’s expense reimbursement policy. Company shall indemnify Employee for all lawful acts committed in course and scope of employment to fullest extent allowed by law in accordance with the Company’s Articles of Incorporation and BylawsAgreement. (gh) grant Employee four (4) weeks' vacation with pay for each twelve-month period, taken at times agreed with Employer, plus holidays observed by Company.

Compensation, Benefits and Reviews. Subject to all the other terms of this Agreement, in connection with Employee's performance of the Services, Employer shall: (a) pay Employee's salary by check twice per month in equal installments in accordance with Employer's regular salary payment schedule, which shall be paid at the rate (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by federal, state and local law) of $165,000 175,000 per year retroactive to March 20commencing as of July 16, 2011 through December 31, 2011, then $195,000 per year from January 1, 2012 through December 31, 2012, then $225,000 per year from January 1, 2013 through December 31, 2014. Employee’s salary for the remaining term of this Agreement shall be set by the Board of Directors, but shall not increase less than five percent (5%) per annum2004. (b) pay a bonus of 2% of the net sales in excess of a total of $15 million achieved by the Company in the third and fourth quarters of 2004, if any. (c) reimburse Employee up to $5,000 for moving expenses from New York to California. (d) at the sole option of the Board of Directors of CompanyEmployer, pay Employee a year-end performance bonus in the form of cash, options to purchase shares, cash or shares of the Company’s common stock or a combination thereofGenius Products, but in no event shall the dollar value of the combined bonus be less than four and one-half percent (4.5%) of EBITDA of the Company (earnings before interest, depreciation, taxes and amortization) for the immediately preceding fiscal year, as long as that figure is positive, up to 100% of the base salary for the annual period for which the bonus is earned. The bonus amount may be increased to in excess of 100% of base salary at the discretion of the Board of Directors. Such bonuses are payable within ninety (90) days of issuance of audited financial statements of the CompanyInc. Common Stock. (ce) grant an option to Employee in the approved form of grant notice for the Company’s 2008 Stock Option Plan Annex B hereto (the “Option”"Options") to purchase up to 1,000,000 150,000 shares of the Company’s no par value common stockGenius Products, Inc. Common Stock, the terms (including, without limitation, the option price and the time of vesting of the shares issuable pursuant thereto) of which Option Options shall be governed by the face thereof subject except to availability and provisions of the extent such terms are superseded by Employer’s 2008 Stock Option Plan (the “Plan”) 's stock option plan currently in effect or as amendedeffect, a copy of which has been provided to Employer. is attached hereto as Annex C. The Option Options shall be granted priced at an exercise price of $2.00 per share and shall vest as follows: 50% on the Effective date Date and vest as to 250,000 shares 10% per month on April 1, 2011, and as to 250,000 shares on April 1st of each following year during the term. The exercise price of the Option shall be the greater of $0.44 per share. The Option shall be exercisable for ten (10) years from date of grant, and shall be treated as a Non-qualified Stock Option (NSO) as such term is defined in section 422 of the Internal Revenue Code when allowed by law. Upon termination, the Option shall expire as to all vested but unexercised shares and as to all unvested shares in accordance with the Stock Option Grant Notice, unless the Option has otherwise expired or Employee is terminated for Cause, in which case the Option must be exercised in accordance with the Plan, which currently calls for exercise within ninety (90) days of termination. In the event of a Change of Control that results in the termination of Employee’s employment prior to the Expiration Date, the vesting of the Option shall accelerate and vest in full. A Change of Control means the sale of all or substantially all of the Company’s assets, a merger or consolidation resulting in securities representing 50% of the combined voting power of the outstanding common stock being transferred to persons who are different from the holders immediately preceding the transaction, the acquisition (directly or indirectly) of 50% of the total combined voting power of the common stock pursuant to a tender or exchange offer, or a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the monthly anniversary date of the appointment or election. Employee hereby grants a right of first refusal to the Company on all shares underlying and purchased by Employee pursuant to the Option (the “Shares”) Effective Date in the event of Employee’s Termination for Cause pursuant to Paragraph 3 months six through ten of this Agreement. The purchase price for the Shares under this right of first refusal shall be the bid price of the common stock on the date of termination of Employee’s employment hereunder (the “Purchase Price”). Prior to selling any of the Shares, Employee shall provide the Company with written notice (the “Notice”) stating: (i) the Employee’s bona fide intention to sell or otherwise transfer the Shares, the number of Shares being transferred (the “Offered Shares”), the identity of the proposed transferee, and the terms and conditions of the proposed transfer. The Company shall have thirty (30) days after receipt of the Notice (“Exercise Period”) to elect to purchase all or less than all of the Offered Shares at the Purchase Price by delivery written notice of exercise of its right of purchase hereunder to Employee (“Notice of Exercise”). Payment of the Purchase Price shall be made in cash (by check or wire transfer) within thirty (30) days after delivery of the Company’s Notice of Exercise. If less than all of the Offered Shares are purchased by the Company within the Exercise Period, Employee may sell or otherwise transfer the remaining Offered Shares to the proposed buyer at a minimum of the price included in the Notice within sixty (60) days after the expiration of the Exercise Period. To the extent the Offered Shares are not so sold, a new Notice shall be given to the Company and the Company shall again be offered the right of first refusal before any of the Shares may be sold or otherwise transferred. (df) grant Employee the option to participate in all of the benefit plans offered by Employer to its Employees generally, including without limitation, insurance plans, 401(k) and other savings plans, Section 125 (cafeteria) and similar pre-tax expense plans, etc., in existence or established during . Employee understands that Employer has only a Blue Cross PPO health plan and no other benefit plan as of the termdate of this Agreement. (eg) grant Employee private health care insurance for Employee and Employee’s 's dependents, either a cellular telephone or a cellular telephone reimbursement, computer laptop or computers and similar devices, an automobile allowance of $11,400.00 per annum payable in equal installments in accordance with the Employers normal payroll payment schedule and subject to deductions required by federal, state and local law, and such other benefits as Employer shall determine to provide to any of its most senior executives employees from time to timetime (in each case subject to adjustment by the mutual consent of Employer and Employee and payable quarterly in cash or, at the sole option of Employer, in the form of Employer common stock valued based on the average price thereof during the immediately preceding quarterly period). (fh) reimburse Employee for all reasonable travel, meals, lodging, communications, entertainment and other business expenses incurred by Employee in connection with Employee’s 's performance under this Agreement subject to the Company’s expense reimbursement policy. Company shall indemnify Employee for all lawful acts committed in course and scope of employment to fullest extent allowed by law in accordance with the Company’s Articles of Incorporation and BylawsAgreement. (gi) grant Employee four (4) 3 weeks' vacation with pay for each twelve-month period, taken at times agreed with Employer, plus holidays observed by Company.

Compensation, Benefits and Reviews. Subject to all the other terms of this Agreement, in connection with Employee's performance of the Services, Employer shall: (a) pay Pay Employee's salary by check twice per month in equal installments in accordance with Employer's regular salary payment schedule, which shall be paid at the rate (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by federal, state and local law) of $165,000 17,500 per year retroactive to March 20, 2011 through December 31, 2011, then $195,000 per year from January 1, 2012 through December 31, 2012, then $225,000 per year from January 1, 2013 through December 31, 2014. Employee’s salary for month commencing on the remaining term first day of this Agreement employment which shall be set by the Board of DirectorsOctober 11, but shall not increase less than five percent (5%) per annum2005. (b) at At the sole option discretion of the Board of Directors of CompanyEmployer, Employer may pay Employee a year-end performance bonus in the form of cash, options to purchase shares, cash or shares of the Company’s common stock or a combination thereofGenius Products, but in no event shall the dollar value of the combined bonus be less than four and one-half percent (4.5%) of EBITDA of the Company (earnings before interest, depreciation, taxes and amortization) for the immediately preceding fiscal year, as long as that figure is positive, up to 100% of the base salary for the annual period for which the bonus is earned. The bonus amount may be increased to in excess of 100% of base salary at the discretion of the Board of Directors. Such bonuses are payable within ninety (90) days of issuance of audited financial statements of the CompanyInc. Common Stock. (c) Recommend to the Board of Directors that Employee be granted 225,000 stock options to vest as follows: 75,000 upon date of grant; 75,000 at the first anniversary of the grant an option date; and 75,000 at the second anniversary of the grant date. The initial grant of stock options will be granted on the date of grant or Employee’s first day of employment, whichever comes later. The stock options’ exercise price will be priced at the closing share price on the date of grant or Employee’s first day of employment, whichever comes later, and will be subject to Employee signing Employer’s form stock option agreement, in substantially the approved form attached hereto as Exhibit A. While Employer has every belief these stock options will be approved, Employee acknowledges that this offer of grant notice for the Companystock options is contingent on Employer’s 2008 Stock Option Plan (the “Option”) to purchase up to 1,000,000 shares Board of the Company’s no par value common stock, the terms (including, without limitation, the option price and the time of vesting of the shares issuable pursuant thereto) of which Option Directors’ approval. The Options shall be governed by the face thereof subject stock option plan, as it may be amended from time to availability and provisions of Employer’s 2008 Stock Option Plan (the “Plan”) time. The stock option plan currently in effect or is attached as amended, a copy of which has been provided to Employer. The Option shall be granted on the Effective date and vest as to 250,000 shares on April 1, 2011, and as to 250,000 shares on April 1st of each following year during the term. The exercise price of the Option shall be the greater of $0.44 per share. The Option shall be exercisable for ten (10) years from date of grant, and shall be treated as a Non-qualified Stock Option (NSO) as such term is defined in section 422 of the Internal Revenue Code when allowed by law. Upon termination, the Option shall expire as to all vested but unexercised shares and as to all unvested shares in accordance with the Stock Option Grant Notice, unless the Option has otherwise expired or Employee is terminated for Cause, in which case the Option must be exercised in accordance with the Plan, which currently calls for exercise within ninety (90) days of termination. In the event of a Change of Control that results in the termination of Employee’s employment prior to the Expiration Date, the vesting of the Option shall accelerate and vest in full. A Change of Control means the sale of all or substantially all of the Company’s assets, a merger or consolidation resulting in securities representing 50% of the combined voting power of the outstanding common stock being transferred to persons who are different from the holders immediately preceding the transaction, the acquisition (directly or indirectly) of 50% of the total combined voting power of the common stock pursuant to a tender or exchange offer, or a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election. Employee hereby grants a right of first refusal to the Company on all shares underlying and purchased by Employee pursuant to the Option (the “Shares”) in the event of Employee’s Termination for Cause pursuant to Paragraph 3 of this Agreement. The purchase price for the Shares under this right of first refusal shall be the bid price of the common stock on the date of termination of Employee’s employment hereunder (the “Purchase Price”). Prior to selling any of the Shares, Employee shall provide the Company with written notice (the “Notice”) stating: (i) the Employee’s bona fide intention to sell or otherwise transfer the Shares, the number of Shares being transferred (the “Offered Shares”), the identity of the proposed transferee, and the terms and conditions of the proposed transfer. The Company shall have thirty (30) days after receipt of the Notice (“Exercise Period”) to elect to purchase all or less than all of the Offered Shares at the Purchase Price by delivery written notice of exercise of its right of purchase hereunder to Employee (“Notice of Exercise”). Payment of the Purchase Price shall be made in cash (by check or wire transfer) within thirty (30) days after delivery of the Company’s Notice of Exercise. If less than all of the Offered Shares are purchased by the Company within the Exercise Period, Employee may sell or otherwise transfer the remaining Offered Shares to the proposed buyer at a minimum of the price included in the Notice within sixty (60) days after the expiration of the Exercise Period. To the extent the Offered Shares are not so sold, a new Notice shall be given to the Company and the Company shall again be offered the right of first refusal before any of the Shares may be sold or otherwise transferred.Exhibit B. (d) grant Grant Employee the option to participate in all of the benefit plans offered by Employer to its Employees Senior Executives generally, on the same terms and conditions, including without limitation, insurance plans, 401(k) and other savings plans, short and long term disability insurance, Section 125 (cafeteria) and similar pre-tax expense plans, holidays, sick leave, etc., which may be amended from time to time in existence or established during Employer’s discretion. Employee understands that Employer has only a Blue Cross PPO health plan and no other benefit plan as of the termdate of this Agreement. (e) grant Grant Employee private health care insurance for Employee and Employee’s dependents, either a cellular telephone or a cellular telephone reimbursement, computer laptop or similar devices, an automobile allowance of $11,400.00 per annum payable in equal installments in accordance with the Employers normal payroll payment schedule and subject to deductions required by federal, state and local law, and such other benefits as Employer shall determine to provide to any of its most senior executives employees from time to time. (f) reimburse Reimburse Employee for all reasonable travel, meals, lodging, communications, entertainment and other business expenses incurred by Employee in connection with Employee’s performance under this Agreement subject to the Company’s expense reimbursement policy. Company shall indemnify Employee for all lawful acts committed in course and scope of employment to fullest extent allowed by law in accordance with the Company’s Articles of Incorporation and BylawsAgreement. (g) grant Grant Employee four three (43) weeks' vacation with pay for each twelve-month period, taken at times agreed with Employer. Unused vacation shall accrue to a maximum of two times the annual accrual (for example a maximum accrual of six (6) weeks if employee earns three (3) weeks vacation per year.) (h) Pay Employee an automobile allowance, plus holidays observed which shall be paid at the rate (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by Company.federal, state and local law) of $600 per month commencing on the first day of employment

Compensation, Benefits and Reviews. Subject to all the other terms of this Agreement, in connection with Employee's performance of the Services, Employer shall: (a) pay Pay Employee's salary by check twice per month in equal installments in accordance with Employer's regular salary payment schedule, which shall be paid at the rate (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by federal, state and local law) of $165,000 per year retroactive to March 20, 2011 through December 31, 2011, then $195,000 per year from January 1, 2012 through December 31, 2012, then $225,000 per year from January 1, 2013 through December 31, 2014. Employee’s salary for the remaining term of this Agreement shall be set by the Board of Directors, but shall not increase less than five percent (5%) per annumyear. (b) at At the sole option of the Board of Directors discretion of Company, pay Employee a year-end performance bonus consistent with the bonus plan held by the Company's Chief Executive Officer. The bonus shall be in the form of cash, options to purchase shares, or shares of the Company’s common stock or a combination thereof, but in no event shall the dollar value of the combined bonus be less than four and one-half percent (4.5%) of EBITDA of the Company (earnings before interest, depreciation, taxes and amortization) for the immediately preceding fiscal year, as long as that figure is positive, up to 100% of the base salary for the annual period for which the bonus is earned. The bonus amount may be increased to in excess of 100% of base salary at the discretion of the Board of Directors. Such bonuses are payable within ninety (90) days of issuance of audited financial statements of the Company. (c) grant an option options to Employee in the approved form of grant notice for the Company’s 2008 Stock Option Plan (the “Option”) EXHIBIT A to purchase up to 1,000,000 900,000 shares of Genius Products, Inc. Common Stock. The Options shall be priced at an exercise price that is the Company’s no par value common stock, closing price per share on the first date of hire and shall vest as follows: 180,000 shares at first-year anniversary of hire date 180,000 shares at second-year anniversary of hire date 180,000 shares at third-year anniversary of hire date 180,000 shares at four-year anniversary of hire date 180,000 shares at five-year anniversary of hire date The terms (including, without limitation, the option price and the time of vesting of the shares issuable pursuant thereto) of which Option Options shall be governed by the face thereof subject except to availability and provisions of the extent such terms are superseded by Employer’s 2008 Stock Option Plan (the “Plan”) 's stock option plan currently in effect or as amendedeffect, a copy of which has been provided to Employer. The Option shall be granted on the Effective date and vest is attached hereto as to 250,000 shares on April 1, 2011, and as to 250,000 shares on April 1st of each following year during the term. The exercise price of the Option shall be the greater of $0.44 per share. The Option shall be exercisable for ten (10) years from date of grant, and shall be treated as a Non-qualified Stock Option (NSO) as such term is defined in section 422 of the Internal Revenue Code when allowed by law. Upon termination, the Option shall expire as to all vested but unexercised shares and as to all unvested shares in accordance with the Stock Option Grant Notice, unless the Option has otherwise expired or Employee is terminated for Cause, in which case the Option must be exercised in accordance with the Plan, which currently calls for exercise within ninety (90) days of termination. In the event of a Change of Control that results in the termination of Employee’s employment prior to the Expiration Date, the vesting of the Option shall accelerate and vest in full. A Change of Control means the sale of all or substantially all of the Company’s assets, a merger or consolidation resulting in securities representing 50% of the combined voting power of the outstanding common stock being transferred to persons who are different from the holders immediately preceding the transaction, the acquisition (directly or indirectly) of 50% of the total combined voting power of the common stock pursuant to a tender or exchange offer, or a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election. Employee hereby grants a right of first refusal to the Company on all shares underlying and purchased by Employee pursuant to the Option (the “Shares”) in the event of Employee’s Termination for Cause pursuant to Paragraph 3 of this Agreement. The purchase price for the Shares under this right of first refusal shall be the bid price of the common stock on the date of termination of Employee’s employment hereunder (the “Purchase Price”). Prior to selling any of the Shares, Employee shall provide the Company with written notice (the “Notice”) stating: (i) the Employee’s bona fide intention to sell or otherwise transfer the Shares, the number of Shares being transferred (the “Offered Shares”), the identity of the proposed transferee, and the terms and conditions of the proposed transfer. The Company shall have thirty (30) days after receipt of the Notice (“Exercise Period”) to elect to purchase all or less than all of the Offered Shares at the Purchase Price by delivery written notice of exercise of its right of purchase hereunder to Employee (“Notice of Exercise”). Payment of the Purchase Price shall be made in cash (by check or wire transfer) within thirty (30) days after delivery of the Company’s Notice of Exercise. If less than all of the Offered Shares are purchased by the Company within the Exercise Period, Employee may sell or otherwise transfer the remaining Offered Shares to the proposed buyer at a minimum of the price included in the Notice within sixty (60) days after the expiration of the Exercise Period. To the extent the Offered Shares are not so sold, a new Notice shall be given to the Company and the Company shall again be offered the right of first refusal before any of the Shares may be sold or otherwise transferred.EXHIBIT B. (d) grant Grant Employee the option to participate in all of the benefit plans offered by Employer to its Employees generally, including without limitation, insurance plans, 401(k) and other savings plans, Section 125 (cafeteria) and similar pre-tax expense plans, holidays, sick leave, etc., which may be amended from time to time in existence or established during Employer's discretion. Employee understands that Employer has only a Blue Cross PPO health plan and no other benefit plan as of the termdate of this Agreement. (e) grant Grant Employee private health care insurance for Employee and Employee’s 's dependents, either a cellular telephone or a cellular telephone reimbursement, computer laptop or computers and similar devices, an automobile allowance of $11,400.00 per annum payable in equal installments in accordance with the Employers normal payroll payment schedule and subject to deductions required by federal, state and local law, and such other benefits as Employer shall determine to provide to any of its most senior executives employees from time to timetime (in each case subject to adjustment by the mutual consent of Employer and Employee and payable quarterly in cash or, at the sole option of Employer, in the form of Employer common stock valued based on the average price thereof during the immediately preceding quarterly period). (f) reimburse Reimburse Employee for all reasonable travel, meals, lodging, communications, entertainment and other business expenses incurred by Employee in connection with Employee’s 's performance under this Agreement subject to the Company’s expense reimbursement policy. Company shall indemnify Employee for all lawful acts committed in course and scope of employment to fullest extent allowed by law in accordance with the Company’s Articles of Incorporation and BylawsAgreement. (g) grant Grant Employee four three (43) weeks' vacation with pay for each twelve-month period, taken at times agreed with Employer, plus holidays observed by Company. Unused vacation shall accrue to a maximum of two times the annual accrual (for example a maximum accrual of six (6) weeks if employee earns three (3) weeks vacation per year.

Compensation, Benefits and Reviews. Subject to all the other terms of this Agreement, in connection with Employee's performance of the Services, Employer shall: (a) pay Pay Employee's salary by check or direct deposit twice per month in equal installments in accordance with Employer's regular salary payment schedule, which shall be paid at the rate of $9,375 (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by federal, state and local law) semi-monthly. b) Pay Employee a quarterly performance bonus (if any), not to exceed $25,000 (before deductions made at Employee's request, if any, and for deductions required by federal, state and local law) in the aggregate per quarter, based on specific performance targets set forth in the bonus plan established by the board of $165,000 per directors. c) Employee will be granted 500,000 non-qualified stock options to vest over a three (3) year retroactive to March 20, 2011 through December 31, 2011, then $195,000 per year from January 1, 2012 through December 31, 2012, then $225,000 per year from January 1, 2013 through December 31, 2014. Employee’s salary for period with one third (1/3) vesting on the first anniversary of the date of the grant and the remainder two thirds (2/3) vesting over the remaining term two (2) years on a monthly basis thereafter (such shares to vest on the first day of this Agreement shall each month thereafter until such shares are vested in full). The stock options' exercise price will be set by the Board of Directors, but shall not increase less than five percent (5%) per annum. (b) priced at the sole closing share price on the date of grant and will be subject to Employee signing Employer's form stock option of the Board of Directors of Company, pay Employee a year-end performance bonus in the form of cash, options to purchase shares, or shares of the Company’s common stock or a combination thereof, but in no event shall the dollar value of the combined bonus be less than four and one-half percent (4.5%) of EBITDA of the Company (earnings before interest, depreciation, taxes and amortization) for the immediately preceding fiscal year, as long as that figure is positive, up to 100% of the base salary for the annual period for which the bonus is earnedagreement. The bonus amount may be increased to in excess of 100% of base salary at the discretion of the Board of Directors. Such bonuses are payable within ninety (90) days of issuance of audited financial statements of the Company. (c) grant an option to Employee in the approved form of grant notice for the Company’s 2008 Stock Option Plan (the “Option”) to purchase up to 1,000,000 shares of the Company’s no par value common stock, the terms (including, without limitation, the option price and the time of vesting of the shares issuable pursuant thereto) of which Option stock options shall be governed by the face thereof subject to availability and provisions of Employer’s 2008 St. Bxxxxxx Software, Inc. 2005 Stock Option Plan (the “Plan”) in effect or as amended, a copy of which has been provided to Employer. The Option shall be granted on the Effective date and vest as to 250,000 shares on April 1, 2011, and as to 250,000 shares on April 1st of each following year during the term. The exercise price of the Option shall be the greater of $0.44 per share. The Option shall be exercisable for ten (10) years from date of grant, and shall be treated as a Non-qualified Stock Option (NSO) as such term is defined in section 422 of the Internal Revenue Code when allowed by law. Upon termination, the Option shall expire as to all vested but unexercised shares and as to all unvested shares in accordance with the Stock Option Grant Notice, unless the Option has otherwise expired or Employee is terminated for Cause, in which case the Option must be exercised in accordance with the Plan, which currently calls for exercise within ninety as it may be amended from time to time (90) days or at the discretion of terminationEmployer under a similar plan or outside of a stock option plan). In the event of a Change of Control (as defined below) occurring after April 28, 2011, and on condition that results in the termination of Employee’s 's employment with Employer is not terminated prior to or in connection with the Expiration DateChange of Control, then the vesting of the Option Employee's unvested stock options, if any, granted under this Paragraph 2(c) shall accelerate and vest in full. A Change of Control means the sale of all or substantially all of the Company’s assets, a merger or consolidation resulting in securities representing 50% of the combined voting power of the outstanding common stock being transferred to persons who are different from the holders immediately preceding the transaction, the acquisition by six (directly or indirectly6) of 50% of the total combined voting power of the common stock pursuant to a tender or exchange offer, or a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election. Employee hereby grants a right of first refusal to the Company on all shares underlying and purchased by Employee pursuant to the Option (the “Shares”) in the event of Employee’s Termination for Cause pursuant to Paragraph 3 of this Agreement. The purchase price for the Shares under this right of first refusal shall be the bid price of the common stock on the date of termination of Employee’s employment hereunder (the “Purchase Price”). Prior to selling any of the Shares, Employee shall provide the Company with written notice (the “Notice”) stating: (i) the Employee’s bona fide intention to sell or otherwise transfer the Shares, the number of Shares being transferred (the “Offered Shares”), the identity of the proposed transferee, and the terms and conditions of the proposed transfer. The Company shall have thirty (30) days after receipt of the Notice (“Exercise Period”) to elect to purchase all or less than all of the Offered Shares at the Purchase Price by delivery written notice of exercise of its right of purchase hereunder to Employee (“Notice of Exercise”). Payment of the Purchase Price shall be made in cash (by check or wire transfer) within thirty (30) days after delivery of the Company’s Notice of Exercise. If less than all of the Offered Shares are purchased by the Company within the Exercise Period, Employee may sell or otherwise transfer the remaining Offered Shares to the proposed buyer at a minimum of the price included in the Notice within sixty (60) days after the expiration of the Exercise Period. To the extent the Offered Shares are not so sold, a new Notice shall be given to the Company and the Company shall again be offered the right of first refusal before any of the Shares may be sold or otherwise transferredmonths. (d) grant Grant Employee the option to participate in all of the benefit plans offered by Employer to all of its Employees generallyemployees from time to time, including without limitation, insurance plans, 401(k) and other savings plans, short and long term disability insurance, Section 125 (cafeteria) and similar pre-tax expense plans, holidays, PTO- Personal Time Off, etc., which may be amended from time to time in existence or established during the termEmployer's discretion. (e) grant Employee private Participate in health care insurance for Employee and Employee’s 's dependents, either a cellular telephone or a cellular telephone reimbursement, computer laptop or similar devices, an automobile allowance of $11,400.00 per annum payable in equal installments in accordance with the Employers normal payroll payment schedule and subject to deductions required by federal, state and local law, and such other benefits as Employer shall determine to provide to any all of its most senior executives employees from time to time. (f) reimburse Reimburse Employee for all reasonable travel, meals, lodging, communications, entertainment and other business expenses incurred by Employee in connection with Employee’s performance under this Agreement subject to the Company’s expense reimbursement policy. Company shall indemnify Employee for all lawful acts committed in course and scope of employment to fullest extent allowed by law in accordance with the Company’s Articles of Incorporation and Bylaws's employment. (g) grant Grant Employee four three (43) weeks' weeks vacation with pay for each twelve-month period, to be taken at times agreed with Employer. Unused vacation shall accrue according to the Employer's accrued vacation policy, plus holidays observed by Companyas may be amended from time to time.

Compensation, Benefits and Reviews. Subject to all the other terms of this Agreement, in connection with Employee's performance of the Services, Employer shall: (a) pay Employee's salary by check twice per month in equal installments in accordance with Employer's regular salary payment schedule, which shall be paid at the rate (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by federal, state and local law) of $165,000 150,000 per year retroactive to March 20, 2011 through December 31, 2011, then $195,000 per year from January 1, 2012 through December 31, 2012, then $225,000 per year from January 1, 2013 through December 31, 2014. Employee’s salary for the remaining term of this Agreement shall be set by the Board of Directors, but shall not increase less than five percent (5%) per annumyear. (b) at the sole option of the Board of Directors of Company, pay Employee a year-end performance bonus in the form of cash, options to purchase shares, cash or shares of the Company’s common stock or a combination thereofGenius Products, but in no event shall the dollar value of the combined bonus be less than four and one-half percent (4.5%) of EBITDA of the Company (earnings before interest, depreciation, taxes and amortization) for the immediately preceding fiscal year, as long as that figure is positive, up to 100% of the base salary for the annual period for which the bonus is earned. The bonus amount may be increased to in excess of 100% of base salary at the discretion of the Board of Directors. Such bonuses are payable within ninety (90) days of issuance of audited financial statements of the CompanyInc. Common Stock. (c) grant confirm the granting of an option to purchase 450,000 shares of Genius Products, Inc. Common Stock (te "Options"). This option was previously granted to Employee on January 3, 2002 in consideration of the Employee's position as a consultant with the Company in the approved form of grant notice for the Company’s 2008 Stock Option Plan (the “Option”) to purchase up to 1,000,000 shares of the Company’s no par value common stockANNEX B hereto, the terms (including, without limitation, the option price and the time of vesting of the shares issuable pursuant thereto) of which Option Options shall be governed by the face thereof subject except to availability and provisions of the extent such terms are superseded by Employer’s 2008 Stock Option Plan (the “Plan”) 's stock option plan currently in effect or as amendedeffect, a copy of which has been provided to Employer. is attached hereto as ANNEX C. The Option shall be granted on the Effective date and vest as to 250,000 shares on April 1, 2011, and as to 250,000 shares on April 1st of each following year during the term. The exercise price accelerated vesting provision of the Option January 3, 2002 Options shall be the greater of $0.44 per share. The Option shall be exercisable for ten (10) years from date of grant, and shall be treated as a Non-qualified Stock Option (NSO) as such term is defined in section 422 of the Internal Revenue Code when allowed by law. Upon termination, the Option shall expire as apply to all vested but unexercised shares and as to all unvested shares in accordance Employee's employment with the Stock Option Grant Notice, unless the Option has otherwise expired or Employee is terminated for Cause, in which case the Option must be exercised in accordance with the Plan, which currently calls for exercise within ninety (90) days of termination. In the event of a Change of Control that results in the termination of Employee’s employment prior to the Expiration Date, the vesting of the Option shall accelerate and vest in full. A Change of Control means the sale of all or substantially all of the Company’s assets, a merger or consolidation resulting in securities representing 50% of the combined voting power of the outstanding common stock being transferred to persons who are different from the holders immediately preceding the transaction, the acquisition (directly or indirectly) of 50% of the total combined voting power of the common stock Company pursuant to a tender or exchange offer, or a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election. Employee hereby grants a right of first refusal to the Company on all shares underlying and purchased by Employee pursuant to the Option (the “Shares”) in the event of Employee’s Termination for Cause pursuant to Paragraph 3 of this Agreement. The purchase price for the Shares under this right of first refusal shall be the bid price of the common stock on the date of termination of Employee’s employment hereunder (the “Purchase Price”). Prior to selling any of the Shares, Employee shall provide the Company with written notice (the “Notice”) stating: (i) the Employee’s bona fide intention to sell or otherwise transfer the Shares, the number of Shares being transferred (the “Offered Shares”), the identity of the proposed transferee, and the terms and conditions of the proposed transfer. The Company shall have thirty (30) days after receipt of the Notice (“Exercise Period”) to elect to purchase all or less than all of the Offered Shares at the Purchase Price by delivery written notice of exercise of its right of purchase hereunder to Employee (“Notice of Exercise”). Payment of the Purchase Price shall be made in cash (by check or wire transfer) within thirty (30) days after delivery of the Company’s Notice of Exercise. If less than all of the Offered Shares are purchased by the Company within the Exercise Period, Employee may sell or otherwise transfer the remaining Offered Shares to the proposed buyer at a minimum of the price included in the Notice within sixty (60) days after the expiration of the Exercise Period. To the extent the Offered Shares are not so sold, a new Notice shall be given to the Company and the Company shall again be offered the right of first refusal before any of the Shares may be sold or otherwise transferred. (d) deliver to Employee, as a one-time signing bonus, a Warrant to purchase 162,000 shares of Genius Products, Inc. Common Stock at an exercise price of $0.63 per share that is substantially in the form of ANNEX D ------- hereto; (e) grant Employee the option to participate in all of the benefit plans offered by Employer to its Employees generally, including without limitation, insurance plans, 401(k) and other savings plans, Section 125 (cafeteria) and similar pre-tax expense plans, etc., in existence or established during . Employee understands that Employer has only a Blue Cross PPO health plan and no other benefit plan as of the termdate of this Agreement. (ef) grant Employee private health care insurance for Employee and Employee’s 's dependents, either a cellular telephone or a cellular telephone reimbursementallowance of up to $200 per month based on actual usage, computer laptop or computers and similar devices, an automobile allowance of $11,400.00 2,250 per annum payable in equal installments in accordance with the Employers normal payroll payment schedule and subject to deductions required by federal, state and local lawquarterly period, and such other benefits as Employer shall determine to provide to any of its most senior executives from time to timetime (in each case subject to adjustment by the mutual consent of Employer and Employee and payable quarterly in cash or, at the sole option of Employer, in the form of Employer common stock valued based on the average price thereof during the immediately preceding quarterly period). (fg) reimburse Employee for all reasonable travel, meals, lodging, communications, entertainment and other business expenses incurred by Employee in connection with Employee’s 's performance under this Agreement subject to the Company’s expense reimbursement policy. Company shall indemnify Employee for all lawful acts committed in course and scope of employment to fullest extent allowed by law in accordance with the Company’s Articles of Incorporation and BylawsAgreement. (gh) grant Employee four (4) weeks' vacation with pay for each twelve-month period, taken at times agreed with Employer, plus holidays observed by Company.

Compensation, Benefits and Reviews. Subject to all the other terms of this Agreement, in connection with Employee's performance of the Services, Employer shall: (a) pay Pay Employee's salary by check twice per month in equal installments in accordance with Employer's regular salary payment schedule, which shall be paid at the rate (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by federal, state and local law) of $165,000 17,500 per year retroactive to March 20, 2011 through December 31, 2011, then $195,000 per year from January 1, 2012 through December 31, 2012, then $225,000 per year from January 1, 2013 through December 31, 2014. Employee’s salary for month commencing on the remaining term first day of this Agreement employment which shall be set by the Board of DirectorsJanuary 2, but shall not increase less than five percent (5%) per annum2006. (b) Pay Employee a guaranteed bonus of 25% of Employee’s base salary set forth in Paragraph 2(a) above, payable quarterly. By way of example, at the current base salary of $17,500 per month, Employer will pay Employee a guaranteed bonus of $13,125 every three months. In addition, at the sole option discretion of the Board of Directors of CompanyEmployer, Employer may pay Employee a year-end performance bonus in the form of cash, options to purchase shares, cash or shares of the Company’s common stock or a combination thereofGenius Products, but in no event shall the dollar value Inc. Common Stock of the combined bonus be less than four and one-half percent (4.5%) of EBITDA of the Company (earnings before interest, depreciation, taxes and amortization) for the immediately preceding fiscal year, as long as that figure is positive, up to 100% of the base salary for the annual period for which the bonus is earned. The bonus amount may be increased to in excess of 10050% of base salary at the discretion of the Board of Directors. Such bonuses are payable within ninety (90) days of issuance of audited financial statements of the Companysalary. (c) Recommend to the Board of Directors that Employee be granted 225,000 stock options to vest as follows: 75,000 upon date of grant; 75,000 at the first anniversary of the grant an option date; and 75,000 at the second anniversary of the grant date. The initial grant of stock options will be granted on the date of grant or Employee’s first day of employment, whichever comes later. The stock options’ exercise price will be priced at the closing share price on the date of grant or Employee’s first day of employment, whichever comes later, and will be subject to Employee signing Employer’s form stock option agreement, in substantially the approved form attached hereto as Exhibit A. While Employer has every belief these stock options will be approved, Employee acknowledges that this offer of grant notice for the Companystock options is contingent on Employer’s 2008 Stock Option Plan (the “Option”) to purchase up to 1,000,000 shares Board of the Company’s no par value common stock, the terms (including, without limitation, the option price and the time of vesting of the shares issuable pursuant thereto) of which Option Directors’ approval. The Options shall be governed by the face thereof subject stock option plan, as it may be amended from time to availability and provisions of Employer’s 2008 Stock Option Plan (the “Plan”) time. The stock option plan currently in effect or is attached as amended, a copy of which has been provided to Employer. The Option shall be granted on the Effective date and vest as to 250,000 shares on April 1, 2011, and as to 250,000 shares on April 1st of each following year during the term. The exercise price of the Option shall be the greater of $0.44 per share. The Option shall be exercisable for ten (10) years from date of grant, and shall be treated as a Non-qualified Stock Option (NSO) as such term is defined in section 422 of the Internal Revenue Code when allowed by law. Upon termination, the Option shall expire as to all vested but unexercised shares and as to all unvested shares in accordance with the Stock Option Grant Notice, unless the Option has otherwise expired or Employee is terminated for Cause, in which case the Option must be exercised in accordance with the Plan, which currently calls for exercise within ninety (90) days of termination. In the event of a Change of Control that results in the termination of Employee’s employment prior to the Expiration Date, the vesting of the Option shall accelerate and vest in full. A Change of Control means the sale of all or substantially all of the Company’s assets, a merger or consolidation resulting in securities representing 50% of the combined voting power of the outstanding common stock being transferred to persons who are different from the holders immediately preceding the transaction, the acquisition (directly or indirectly) of 50% of the total combined voting power of the common stock pursuant to a tender or exchange offer, or a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election. Employee hereby grants a right of first refusal to the Company on all shares underlying and purchased by Employee pursuant to the Option (the “Shares”) in the event of Employee’s Termination for Cause pursuant to Paragraph 3 of this Agreement. The purchase price for the Shares under this right of first refusal shall be the bid price of the common stock on the date of termination of Employee’s employment hereunder (the “Purchase Price”). Prior to selling any of the Shares, Employee shall provide the Company with written notice (the “Notice”) stating: (i) the Employee’s bona fide intention to sell or otherwise transfer the Shares, the number of Shares being transferred (the “Offered Shares”), the identity of the proposed transferee, and the terms and conditions of the proposed transfer. The Company shall have thirty (30) days after receipt of the Notice (“Exercise Period”) to elect to purchase all or less than all of the Offered Shares at the Purchase Price by delivery written notice of exercise of its right of purchase hereunder to Employee (“Notice of Exercise”). Payment of the Purchase Price shall be made in cash (by check or wire transfer) within thirty (30) days after delivery of the Company’s Notice of Exercise. If less than all of the Offered Shares are purchased by the Company within the Exercise Period, Employee may sell or otherwise transfer the remaining Offered Shares to the proposed buyer at a minimum of the price included in the Notice within sixty (60) days after the expiration of the Exercise Period. To the extent the Offered Shares are not so sold, a new Notice shall be given to the Company and the Company shall again be offered the right of first refusal before any of the Shares may be sold or otherwise transferred.Exhibit B. (d) grant Grant Employee the option to participate in all of the benefit plans offered by Employer to its Employees Senior Executives generally, on the same terms and conditions, including without limitation, insurance plans, 401(k) and other savings plans, short and long term disability insurance, Section 125 (cafeteria) and similar pre-tax expense plans, holidays, sick leave, etc., which may be amended from time to time in existence or established during Employer’s discretion. Employee understands that Employer has only a Blue Cross PPO health plan and no other benefit plan as of the termdate of this Agreement. (e) grant Grant Employee private health care insurance for Employee and Employee’s dependents, either a cellular telephone or a cellular telephone reimbursement, computer laptop or similar devices, an automobile allowance of $11,400.00 per annum payable in equal installments in accordance with the Employers normal payroll payment schedule and subject to deductions required by federal, state and local law, and such other benefits as Employer shall determine to provide to any of its most senior executives employees from time to time. (f) reimburse Reimburse Employee for all reasonable travel, meals, lodging, communications, entertainment and other business expenses incurred by Employee in connection with Employee’s performance under this Agreement subject to the Company’s expense reimbursement policy. Company shall indemnify Employee for all lawful acts committed in course and scope of employment to fullest extent allowed by law in accordance with the Company’s Articles of Incorporation and BylawsAgreement. (g) grant Reimburse Employee four for reasonable telephone, facsimile, and Internet service charges incurred at Employee's home office based in New Jersey in connection with the Employee's performance under this agreement (4h) Grant Employee three (3) weeks' vacation with pay for each twelve-month period, taken at times agreed with Employer. Unused vacation shall accrue to a maximum of two times the annual accrual (for example a maximum accrual of six (6) weeks if employee earns three (3) weeks vacation per year.) (i) Pay Employee an automobile allowance, plus holidays observed which shall be paid at the rate (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by Company.federal, state and local law) of $800 per month commencing on the first day of employment

Compensation, Benefits and Reviews. Subject to all the other terms of this Agreement, in connection with for Employee's performance of the Services, Employer shall: (a) pay Employee's salary by check twice per month in equal installments in accordance with Employer's regular salary payment schedule, which shall be paid at the rate (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by federal, state and local law) of $165,000 160,000 per year retroactive to March 20commencing as of August 23, 2011 through December 31, 2011, then $195,000 per year from January 1, 2012 through December 31, 2012, then $225,000 per year from January 1, 2013 through December 31, 2014. Employee’s salary for the remaining term of this Agreement shall be set by the Board of Directors, but shall not increase less than five percent (5%) per annum2004. (b) at the sole option of the Board of Directors of CompanyEmployer, pay Employee a year-end performance bonus in the form of cash, options to purchase shares, cash or shares of the Company’s common stock or a combination thereofGenius Products, but in no event shall the dollar value of the combined bonus be less than four and one-half percent (4.5%) of EBITDA of the Company (earnings before interest, depreciation, taxes and amortization) for the immediately preceding fiscal year, as long as that figure is positive, up to 100% of the base salary for the annual period for which the bonus is earned. The bonus amount may be increased to in excess of 100% of base salary at the discretion of the Board of Directors. Such bonuses are payable within ninety (90) days of issuance of audited financial statements of the CompanyInc. Common Stock. (c) grant an option to Employee in the approved form of grant notice for the Company’s 2008 Stock Option Plan ANNEX B hereto (the “Option”"Options") to purchase up to 1,000,000 75,000 shares of the Company’s no par value common stockGenius Products, Inc. Common Stock, the terms (including, without limitation, the option price and the time of vesting of the shares issuable pursuant thereto) of which Option Options shall be governed by the face thereof subject except to availability and provisions of the extent such terms are superseded by Employer’s 2008 Stock Option Plan (the “Plan”) 's stock option plan currently in effect or as amendedeffect, a copy of which has been provided to Employer. is attached hereto as ANNEX C. The Option Options shall be granted on the Effective date and vest as to 250,000 shares on April 1, 2011, and as to 250,000 shares on April 1st of each following year during the term. The priced at an exercise price that is the weighted average of the Option shall be the greater of $0.44 closing price per share. The Option shall be exercisable for ten (10) years from date of grant, and shall be treated as a Non-qualified Stock Option (NSO) as such term is defined in section 422 share of the Internal Revenue Code when allowed by law. Upon termination, Employer's stock for the Option shall expire as to all vested but unexercised shares and as to all unvested shares in accordance with the Stock Option Grant Notice, unless the Option has otherwise expired or Employee is terminated for Cause, in which case the Option must be exercised in accordance with the Plan, which currently calls for exercise within ninety (90) days of termination. In the event of a Change of Control that results in the termination of Employee’s employment three weeks prior to the Expiration Date, Effective Date and shall vest on the vesting one-year anniversary of the Option shall accelerate and vest in full. A Change of Control means the sale of all or substantially all of the Company’s assets, a merger or consolidation resulting in securities representing 50% of the combined voting power of the outstanding common stock being transferred to persons who are different from the holders immediately preceding the transaction, the acquisition (directly or indirectly) of 50% of the total combined voting power of the common stock pursuant to a tender or exchange offer, or a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election. Employee hereby grants a right of first refusal to the Company on all shares underlying and purchased by Employee pursuant to the Option (the “Shares”) in the event of Employee’s Termination for Cause pursuant to Paragraph 3 of this Agreement. The purchase price for the Shares under this right of first refusal shall be the bid price of the common stock on the date of termination of Employee’s employment hereunder (the “Purchase Price”). Prior to selling any of the Shares, Employee shall provide the Company with written notice (the “Notice”) stating: (i) the Employee’s bona fide intention to sell or otherwise transfer the Shares, the number of Shares being transferred (the “Offered Shares”), the identity of the proposed transferee, and the terms and conditions of the proposed transfer. The Company shall have thirty (30) days after receipt of the Notice (“Exercise Period”) to elect to purchase all or less than all of the Offered Shares at the Purchase Price by delivery written notice of exercise of its right of purchase hereunder to Employee (“Notice of Exercise”). Payment of the Purchase Price shall be made in cash (by check or wire transfer) within thirty (30) days after delivery of the Company’s Notice of Exercise. If less than all of the Offered Shares are purchased by the Company within the Exercise Period, Employee may sell or otherwise transfer the remaining Offered Shares to the proposed buyer at a minimum of the price included in the Notice within sixty (60) days after the expiration of the Exercise Period. To the extent the Offered Shares are not so sold, a new Notice shall be given to the Company and the Company shall again be offered the right of first refusal before any of the Shares may be sold or otherwise transferredgrant date. (d) grant Employee the option to participate in all of the benefit plans offered by Employer to its Employees generally, including without limitation, insurance plans, 401(k) and other savings plans, Section 125 (cafeteria) and similar pre-tax expense plans, etc., in existence or established during . Employee understands that Employer has only a Blue Cross PPO health plan and no other benefit plan as of the termdate of this Agreement. (e) grant Employee private health care insurance for Employee and Employee’s 's dependents, either a cellular telephone or a cellular telephone reimbursementtelephone, computer laptop or computers and similar devices, an automobile allowance of $11,400.00 per annum payable in equal installments in accordance with the Employers normal payroll payment schedule and subject to deductions required by federal, state and local law, and such other benefits as Employer shall determine to provide to any of its most senior executives employees from time to time. Employer shall pay directly to Employee the Employer's portion of the cost of private health care insurance until such time as the Employee becomes eligible for coverage under Employer's Blue Cross PPO health plan. (f) reimburse Employee for all reasonable travel, meals, lodging, communications, entertainment and other business expenses incurred by Employee in connection with Employee’s 's performance under this Agreement subject to the Company’s expense reimbursement policy. Company shall indemnify Employee for all lawful acts committed in course and scope of employment to fullest extent allowed by law in accordance with the Company’s Articles of Incorporation and BylawsAgreement. (g) grant Employee four three (43) weeks' vacation with pay for each twelve-month period, taken at times agreed with Employer, plus holidays observed by Company.

Compensation, Benefits and Reviews. Subject to all the other terms of this Agreement, in connection with Employee's performance of the Services, Employer shall: (a) pay Pay Employee's salary by check or direct deposit twice per month in equal installments in accordance with Employer's regular salary payment schedule, which shall be paid at the rate of $9,375 (before deductions for advances and deductions made at Employee's request, if any, and for deductions required by federal, state and local law) of $165,000 per year retroactive to March 20, 2011 through December 31, 2011, then $195,000 per year from January 1, 2012 through December 31, 2012, then $225,000 per year from January 1, 2013 through December 31, 2014. Employee’s salary for the remaining term of this Agreement shall be set by the Board of Directors, but shall not increase less than five percent (5%) per annumsemi-monthly. (b) at the sole option of the Board of Directors of Company, pay Pay Employee a year-end performance bonus in the form of cash, options to purchase shares, or shares of the Company’s common stock or a combination thereof, but in no event shall the dollar value of the combined bonus be less than four and one-half percent (4.5%) of EBITDA of the Company (earnings before interest, depreciation, taxes and amortization) for the immediately preceding fiscal year, as long as that figure is positive, up to 100% of the base salary for the annual period for which the bonus is earned. The bonus amount may be increased to in excess of 100% of base salary at the discretion of the Board of Directors. Such bonuses are payable within ninety (90) days of issuance of audited financial statements of the Company. (c) grant an option to Employee in the approved form of grant notice for the Company’s 2008 Stock Option Plan (the “Option”) to purchase up to 1,000,000 shares of the Company’s no par value common stock, monthly commission on sales based on the terms and conditions set forth in a then current Sales Variable (including, without limitation, the option price and the time of vesting of the shares issuable pursuant theretoCommission) of which Option shall be governed by the face thereof subject to availability and provisions of Employer’s 2008 Stock Option Plan Compensation plan (the “Plan”) in effect established by the board of directors or a committee of the board of directors, as amendedsuch Plan may be amended by the board of directors, a copy of which has been provided or its committee, from time to time. Attached hereto as Exhibit C is the current Plan for Q4 2000- X0 0000. c) Subject to Employer’s board of directors’ approval, Employee will be granted either (i) 365,000 non-qualified stock options; or (ii) a commensurate number of restricted shares (the “Grant”). The Option Grant will vest over a four (4) year period with one quarter (1/4) vesting on the first anniversary of the date of the grant and the remainder three quarters (3/4) vesting over the remaining three (3) years on a monthly basis thereafter (such shares to vest on the first day of each month thereafter until such shares are vested in full). The stock options’ exercise price will be priced at the closing share price on the date of grant and will be subject to Employee first signing Employer’s form stock option agreement or restricted share agreement. The Grant shall be granted on governed by the Effective date and vest as to 250,000 shares on April 1St. Bxxxxxx Software, 2011, and as to 250,000 shares on April 1st of each following year during the term. The exercise price of the Option shall be the greater of $0.44 per share. The Option shall be exercisable for ten (10) years from date of grant, and shall be treated as a Non-qualified Inc. 2005 Stock Option (NSO) as such term is defined in section 422 of the Internal Revenue Code when allowed by law. Upon terminationPlan or St. Bxxxxxx Software, the Option shall expire as to all vested but unexercised shares and as to all unvested shares in accordance with the Stock Option Grant Notice, unless the Option has otherwise expired or Employee is terminated for Cause, in which case the Option must be exercised in accordance with the Inc. 2006 Recruitment Equity Incentive Plan, which currently calls for exercise within ninety as either may be amended from time to time (90) days or at the discretion of terminationEmployer, under a similar plan or outside of a stock option or restricted share plan). In the event of a Change of Control (as defined below) occurring after October 18, 2011, and on condition that results Employee’s employment with Employer is not terminated prior to or in connection with the termination Change of Control, then the vesting of Employee’s employment prior to the Expiration Dateunvested stock options, the vesting of the Option if any, granted under this Paragraph 2(c) shall accelerate and vest in full. A Change of Control means the sale of all or substantially all of the Company’s assets, a merger or consolidation resulting in securities representing 50% of the combined voting power of the outstanding common stock being transferred to persons who are different from the holders immediately preceding the transaction, the acquisition by six (directly or indirectly6) of 50% of the total combined voting power of the common stock pursuant to a tender or exchange offer, or a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election. Employee hereby grants a right of first refusal to the Company on all shares underlying and purchased by Employee pursuant to the Option (the “Shares”) in the event of Employee’s Termination for Cause pursuant to Paragraph 3 of this Agreement. The purchase price for the Shares under this right of first refusal shall be the bid price of the common stock on the date of termination of Employee’s employment hereunder (the “Purchase Price”). Prior to selling any of the Shares, Employee shall provide the Company with written notice (the “Notice”) stating: (i) the Employee’s bona fide intention to sell or otherwise transfer the Shares, the number of Shares being transferred (the “Offered Shares”), the identity of the proposed transferee, and the terms and conditions of the proposed transfer. The Company shall have thirty (30) days after receipt of the Notice (“Exercise Period”) to elect to purchase all or less than all of the Offered Shares at the Purchase Price by delivery written notice of exercise of its right of purchase hereunder to Employee (“Notice of Exercise”). Payment of the Purchase Price shall be made in cash (by check or wire transfer) within thirty (30) days after delivery of the Company’s Notice of Exercise. If less than all of the Offered Shares are purchased by the Company within the Exercise Period, Employee may sell or otherwise transfer the remaining Offered Shares to the proposed buyer at a minimum of the price included in the Notice within sixty (60) days after the expiration of the Exercise Period. To the extent the Offered Shares are not so sold, a new Notice shall be given to the Company and the Company shall again be offered the right of first refusal before any of the Shares may be sold or otherwise transferredmonths. (d) grant Grant Employee the option to participate in all of the benefit plans offered by Employer to all of its Employees generallyemployees from time to time, including without limitation, insurance plans, 401(k) and other savings plans, short and long term disability insurance, Section 125 (cafeteria) and similar pre-tax expense plans, holidays, PTO- Personal Time Off, etc., which may be amended from time to time in existence or established during the termEmployer’s discretion. (e) grant Employee private Participate in health care insurance for Employee and Employee’s dependents, either a cellular telephone or a cellular telephone reimbursement, computer laptop or similar devices, an automobile allowance of $11,400.00 per annum payable in equal installments in accordance with the Employers normal payroll payment schedule and subject to deductions required by federal, state and local law, and such other benefits as Employer shall determine to provide to any all of its most senior executives employees from time to time. (f) reimburse Reimburse Employee for all reasonable travel, meals, lodging, communications, entertainment and other business expenses incurred by Employee in connection with Employee’s performance under this Agreement subject to the Company’s expense reimbursement policy. Company shall indemnify Employee for all lawful acts committed in course and scope of employment to fullest extent allowed by law in accordance with the Company’s Articles of Incorporation and Bylawsemployment. (g) grant Grant Employee four three (43) weeks' vacation weeks PTO with pay for each twelve-month period, to be taken at times agreed with Employer. Unused PTO shall accrue according to the Employer’s PTO policy, plus holidays observed by Companyas may be amended from time to time.