Genius Products Announces Long-Term Co-Production And Distribution Agreements With Entertainment Rights Plc And Classic Media

Deal Positions Genius as a Leader in the Family & Faith Entertainment Categories

January 12, 2007

Genius Products, LLC, The Weinstein Company LLC (TWC) and Entertainment Rights Plc (“ER”) of London, England, and Classic Media Holdings, Inc. of New York City announced today that they have entered into long-term agreements for the distribution and co-production and co-financing of multiple home video and videogame productions for the family, children and teen markets. ER is one of the UK’s leading independent media groups specializing in the ownership of children’s and family programming, characters and brands. ER recently announced an agreement to acquire U.S.-based Classic Media, which is still subject to, amongst other things, ER shareholders’ approval. Genius Products will be the exclusive North American distributor of home video and certain digital media distribution rights in Classic's and ER's catalogs of children's and faith-based animated films as well as other titles and series. The announcement was made today by Stephen K. Bannon, Chairman and Trevor Drinkwater, President and CEO of Genius Products, Inc. (OTCBB:GNPI), Bob and Harvey Weinstein, Co-Chairmen of The Weinstein Company, Mike Heap, CEO of Entertainment Rights Plc, and Eric Ellenbogen and John Engelman, founders of Classic Media. Under the terms of the multi-year distribution agreements, Genius Products will be the North American home video and digital distributor for ER’s and Classic’s libraries of more than, in aggregate, 4,000 programs. Included are Lassie, Fat Albert, Postman Pat, Rupert Bear, the best-selling holiday specials Rudolph the Red-Nosed Reindeer, Frosty the Snowman and Santa Claus is Comin’ to Town, and VeggieTales, the world’s most popular faith-based kids’ brand with more than 50 million videos sold. Genius will also have North American home video and digital distribution rights in new productions including The Lone Ranger, Gumby, and She Ra. In addition, Genius will have North American distribution rights for a slate of up to 12 new videogames to be produced and financed by Genius based on titles in the ER and Filmation catalogs. “We are very excited about the new partnerships with ER and Classic Media. The economic model associated with the new agreements is a great fit for our business and is expected to add approximately $75 million in annual gross revenues and should further enhance our operating margins,” said Trevor Drinkwater, President and CEO of Genius Products. “The combination of perennial titles such as Rudolph, Frosty, Peter Cottontail, Fat Albert and The Archies, the introduction into America of the highly successful brands from London, Rupert Bear and Postman Pat, exciting new productions, and VeggieTales, the most popular faith-based animated children’s entertainment, will instantly position us as a leader in the important family/faith content segment.” In addition Mr. Drinkwater stated, “We believe our experienced management team, proven infrastructure, and marketing expertise working closely with Sony Wonder, Classic Media’s prior distributor, will facilitate a quick and seamless transition for our retail partners." "These agreements offer an unprecedented opportunity to distribute the characters and brands of ER and Classic throughout North America, creating one of the leading portfolios of contemporary classic and new children's DVD’s and digital rights in the world,” stated Mike Heap, CEO, Entertainment Rights Plc. “We will be introducing North America to some of our leading characters for the first time and will, once Classic becomes part of the ER Group, be exploiting Classic’s content to ensure the best placement possible in the world’s largest media market – the U.S. – and will expand our brand recognition as we sell merchandise through American retailers. We are delighted to be partnering with Genius and in particular we look forward to working with The Weinstein Company who we believe have a unique perspective on brand development in the US.” “Bob and I have a tremendous amount of respect for the business that ER and Classic created and believe that their content is unmatched internationally in the children and family category,” said Harvey Weinstein. “We are excited to begin working on co-production opportunities and look forward to many projects going forward.” ER, Classic and TWC will be co-producing and co-financing new animated children's productions including Gumby, Kung Fu Magoo, Lone Ranger, Rupert Bear, Postman Pat and She-Ra. North American home video and digital distribution of co-productions will be handled by Genius Products and ER will distribute internationally. The productions will be managed by Eric Robinson, VP of Production and Development, of TWC. Eric Ellenbogen, CEO of Classic Media, commented, “After many successful years with Sony Wonder, we chose Genius Products as our distributor because their combination of major studio infrastructure and entrepreneurial spirit will allow us to aggressively expand our home entertainment business. We are confident that this transition will be seamless for our retail partners and the consumer.” Genius Products will maintain both physical and digital distribution rights for the terms of the agreements. The transactions will automatically grow the Genius Products library to over 2,800 titles. “I am very proud of our early track record of strategically expanding our position in the entertainment industry through the introduction of new brands and content-provider partnerships across the four verticals of Sports, Family/Faith, Lifestyle and Independent Film product segments,” said Stephen K. Bannon, Chairman of Genius Products. “The new agreement with ER and Classic will position us as one of the leaders in the Family/Faith segment just as our agreement with ESPN positioned us as a leader in the Sports segment.” Additionally, Genius’s initiative with ER in the development and production of new videogames based on ER catalog titles marks a significant advance in the expansion of Genius’s business.”

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