POINT 360
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>4
<FILENAME>rlsconsult.txt
<TEXT>
                                  Exhibit 10.2

                              CONSULTING AGREEMENT


        This Consulting Agreement (this AGREEMENT), dated as of October 2, 2002,
is  entered  into  by and  between  Point.360,  a  California  corporation  (the
COMPANY), and R. Luke Stefanko (the CONSULTANT).

        WHEREAS, the Consultant resigned,  as of the end of business on the date
hereof, from all positions he held with the Company,  including his positions as
an officer and director of the Company; and

        WHEREAS,  the Company  desires to hire the Consultant and the Consultant
desires to serve the Company on a part-time basis to assist in the transition to
new management upon the terms and provisions set forth herein;

        NOW,  THEREFORE,  in  consideration  of the  mutual  promises  set forth
herein, the Company and the Consultant hereby agree as follows:

        1. Consulting  Relationship.  Beginning as of the date of this Agreement
and continuing  through  December 31, 2002, the Consultant shall be available to
provide to the Company,  on a part-time  basis,  but in no event greater than 20
hours per month, the following consulting services (the SERVICES):  (i) managing
the day to day operations of the Company;  (ii) overseeing the Company's  sales;
(iii)  developing a five year plan for the Company;  (iv)  attending  facilities
meetings  to  assist in the  transition  to new  management;  and (iv) any other
consulting  services as the  Company  shall  determine.  The  Services  shall be
rendered by Consultant primarily in Hollywood, California and at such times and,
if required in  particular  circumstances,  such other  locations as  reasonably
requested by the Company.  Beginning  January 1, 2003 and  continuing as long as
this Agreement is in effect,  the  Consultant  shall be available to provide the
Services to the Company on an as-needed basis, upon reasonable  request from the
Company from time to time, but in no event greater than 10 hours per month.

        2. Fees. In consideration of the Services to be rendered hereunder,  the
Company shall pay to the Consultant  $10,000 per month  beginning as of the date
hereof and continuing through December 31, 2002, payable on the 15th day of each
month.  In addition,  while this Agreement is in effect,  the Company will allow
the Consultant's  current option grants, as set forth in the attached Exhibit A,
to continue to vest and become  exercisable,  with such options terminating upon
the second  anniversary of the date of this Agreement,  or earlier in accordance
with Section 4(b) below or Section 1 of the Noncompetition Agreement between the
Company and the  Consultant,  entered  into as of the date  hereof and  attached
hereto as EXHIBIT B For all Services  Consultant  provides to the Company  after
January 1, 2003 while this  Agreement  is in effect,  the Company  shall pay the
Consultant a consulting fee of $150 per hour.

        3. Expenses.  The Company shall reimburse the Consultant  within 30 days
following  receipt of  appropriate  documentation  for necessary and  reasonable
out-of-pocket business expenses incurred by the Consultant in the performance of
the Services;  provided, however, that the Consultant shall not be authorized to
incur on behalf of the  Company  any  expenses  in excess of $1,000  without the
prior consent of the Company.

        4. Term and  Termination.  The Consultant shall serve as a consultant to
the Company and shall render the Services to the Company for a period commencing
on October 3, 2002 and terminating October 2, 2004, unless earlier terminated by
either  party  hereto as set forth in this  Section  4. This  Agreement  and the
Consultant's rights and obligations  hereunder shall, under any of the following
circumstances, terminate in advance of the time specified in this Section 4, and
the  Consultant  shall  have the right to  receive  only his Fees that  shall be
accrued  hereunder through the effective date of such termination and shall have
no right to receive any further  compensation  hereunder from and after the time
of such termination:

   (a)  Death.  This  Agreement  and the  Consultant's  duties  hereunder  shall
        terminate immediately upon the Consultant's death.

<PAGE>

   (b)  Termination  by the  Company.  In the event  that the  Consultant  shall
        become either physically or mentally incapacitated so as to be incapable
        of performing his duties as required  hereunder,  and if such incapacity
        shall continue for a period of 40 consecutive  days, the Company may, at
        its  option,  terminate  this  Agreement  and  the  Consultant's  duties
        hereunder  by written  notice to the  Consultant  at that time or at any
        time  thereafter  while  such  incapacity  continues.  The  Company  may
        terminate this Agreement for Cause (as hereinafter  defined) at any time
        upon written notice to the Consultant. "Cause" as used in this Agreement
        means that (i) the Consultant,  after reasonable notice and warning, has
        failed  to  perform  his  assigned  duties,   (ii)  the  Consultant  has
        materially breached any of the terms or conditions of this Agreement, or
        (iii)  the  Consultant  has  been  charged  with a  felony  or with  any
        intentionally  fraudulent act that materially damages, or may materially
        damage, the business or reputation of the Company.

   (c)  Termination  by  the  Consultant.  The  Consultant  may  terminate  this
        Agreement at any time upon written  notice to the Company if the Company
        shall have materially breached any of the provisions of this Agreement.

        5.  Independent  Contractor.  The  Consultant's  relationship  with  the
Company will be that of an independent contractor and not that of an employee of
the Company.

   (a)  No Authority to Bind Company.  Neither the Consultant,  nor any partner,
        agent or  employee  of the  Consultant,  has  authority  to  enter  into
        contracts that bind the Company or create obligations on the part of the
        Company without the prior written authorization of the Company.

   (b)  No Benefits. The Consultant  acknowledges and agrees that the Consultant
        will not be  eligible  for any  Company  employee  benefits  and, to the
        extent  the  Consultant  otherwise  would be  eligible  for any  Company
        employee  benefits  but for the  express  terms of this  Agreement,  the
        Consultant  hereby  expressly  declines to  participate  in such Company
        employee benefits.

   (c)  Withholding;   Indemnification.   The   Consultant   shall   have   full
        responsibility  for applicable  withholding  taxes for all  compensation
        paid to the Consultant under this Agreement, and for compliance with all
        applicable  labor  and  employment  requirements  with  respect  to  the
        Consultant's  self-employment,  sole  proprietorship  or  other  form of
        business  organization.  The Consultant agrees to indemnify,  defend and
        hold the Company  harmless from any liability for, or assessment of, any
        claims or penalties  with respect to such  withholding  taxes,  labor or
        employment requirements,  including any liability for, or assessment of,
        withholding  taxes  imposed  on  the  Company  by  the  relevant  taxing
        authorities with respect to any compensation paid to the Consultant.

        6. Corporate  Opportunity.  The Consultant  agrees that the Consultant's
right to pursue activities that may be deemed  "corporate  opportunities" of the
Company is  subject to the  Noncompetition  Agreement  referred  to in Section 2
above (attached hereto as EXHIBIT B) and  incorporated  into this Agreement by
this reference.

        7.  Confidential  Information.  While this  Agreement is in effect,  the
parties  agree to be bound by the terms  and  provisions  of the  Noncompetition
Agreement  referred to in Section 2 above (attached  hereto as EXHIBIT B) with
respect to confidential information.

        8. Proprietary Rights. All work performed and all materials developed or
prepared for the Company by the  Consultant  in  rendering  the Services are the
property  of the Company and all title and  interest  therein  shall vest in the
Company  and shall be deemed to be works made for hire and made in the course of
the services rendered hereunder.  To the extent that title to any such works may
not,  by  operation  of  law,  vest in the  Company  or  such  works  may not be
considered  works made for hire,  all  rights,  title and  interest  therein are
hereby  irrevocably  assigned to the Company.  The Consultant agrees to give the
Company and any person designated by the Company such reasonable assistance,  at
the  Company's  expense,  as is required  to perfect the rights  defined in this
Section 8.

<PAGE>

        9.  Indemnification.  The  Consultant  agrees to indemnify  and hold the
Company harmless from and against any and all claims, demands, causes of action,
losses,  damages,  liabilities,  costs and expenses,  including attorneys' fees,
arising from a breach of any of the Consultant's  representations and warranties
herein or attributable to or resulting from the Consultant's gross negligence or
willful  misconduct  in rendering  the Services to the Company.  The  Consultant
warrants and  represents  that the  Consultant  has full power and  authority to
enter into and perform this Agreement.  The Company agrees to indemnify and hold
the Consultant harmless from and against any and all claims,  demands, causes of
action, losses, damages, liability, costs and expenses, including attorneys fees
arising out of the  Consultant's  services  hereunder,  other than those arising
from  the  Consultant's  breach  of any of his  representations  and  warranties
hereunder or the Consultant's gross negligence or willful misconduct.

        10. Miscellaneous.

   (a)  Amendments  and Waivers.  Any term of this  Agreement  may be amended or
        waived only with the written consent of the parties.

   (b)  Sole  Agreement.  This Agreement  constitutes  the sole agreement of the
        parties and  supersedes  all oral  negotiations  and prior writings with
        respect to the subject matter hereof.

   (c)  Notices.  Any notice required or permitted by this Agreement shall be in
        writing and shall be deemed  sufficient  upon  receipt,  when  delivered
        personally  or by  courier,  overnight  delivery  service  or  confirmed
        facsimile,  48  hours  after  being  deposited  in the  regular  mail as
        certified or  registered  mail  (airmail if sent  internationally)  with
        postage prepaid, if such notice is addressed to the party to be notified
        at such party's  address or facsimile  number as set forth below,  or as
        subsequently modified by written notice.

   (d)  Choice  of  Law.  The   validity,   interpretation,   construction   and
        performance of this Agreement shall be governed by the laws of the State
        of  California,  without  giving effect to the principles of conflict of
        laws.

   (e)  Dispute  Resolution.  Any  dispute  arising  out of or  relating to this
        Agreement  shall be  decided  by  binding  arbitration  by the  American
        Arbitration  Association  and shall be held in Los Angeles,  California.
        The ruling of the  arbitrator  shall be final and may be enforced by any
        party to such arbitration in any court of competent jurisdiction located
        in Los Angeles, California.

   (f)  Attorneys'  Fees. If an arbitration or other legal proceeding is brought
        to enforce or interpret the  provisions  of this  Agreement or as to the
        rights or  obligations  of any party to this  Agreement,  the prevailing
        party in such  action  shall  be  entitled  to  recover  its  reasonable
        attorneys' fees and costs.

   (g)  Severability. If one or more provisions of this Agreement are held to be
        unenforceable  under  applicable  law, the parties agree to  renegotiate
        such provision in good faith. In the event that the parties cannot reach
        a mutually  agreeable and  enforceable  replacement  for such provision,
        then (i) such provision shall be excluded from this Agreement,  (ii) the
        balance of the Agreement  shall be interpreted as if such provision were
        so excluded and (iii) the balance of the Agreement  shall be enforceable
        in accordance with its terms.

<PAGE>

   (h)  Counterparts.  This Agreement may be executed in  counterparts,  each of
        which  shall be  deemed  an  original,  but all of which  together  will
        constitute one and the same instrument.

   (i)  Effect on Successors in Interest; Assignment. This Agreement shall inure
        to the  benefit  of and  be  binding  upon  the  heirs,  administrators,
        executors, and successors of each of the parties hereto. The services to
        be  rendered  under  this  Agreement  are  personal  to and  may  not be
        delegated  by the  Consultant  except to a company  wholly  owned by the
        Consultant; provided, however, that the Consultant may assign his rights
        to payment under this Agreement to any person or entity.

        The parties have executed  this  Agreement on the  respective  dates set
forth below.

                                    POINT.360


                                                By: /s/ Haig S. Bagerdjian
                                                    -----------------------
                                                        Haig S. Bagerdjian

                                                Date: 10/02/02


                                                By: /s/ Alan Steel
                                                    -----------------------
                                                        Alan Steel

                                                Date: 10/02/02

                                                Address:
                                                        Point.360
                                                        P.O. Box 1830
                                                        Hollywood, CA 90028
                                                        Attn: President
                                                        Fax: (323) 957-2297


                                                R. LUKE STEFANKO


                                                By: /s/ R. Luke Stefanko
                                                    -----------------------
                                                        R. Luke Stefanko

                                                Address:



                                                Date: 10/02/02



<PAGE>

                                    EXHIBIT A

                              CURRENT STOCK OPTIONS



                                Number of Shares
                                ----------------

                                     55,000
                                    179,000
                                    200,000
                                     64,100
                                    200,000
                                    -------
                                    698,100





<PAGE>


                                    EXHIBIT B

                            NONCOMPETITION AGREEMENT



                       See Exhibit 10.3 to this Form 8-K.


</TEXT>
</DOCUMENT>
