THIS AMENDMENT TO EMPLOYMENT AGREEMENT (this "Agreement") is made and entered
into as of October 10, 1997 by and between MEDIA ARTS GROUP, INC. (the "Company"
or  "Employer") and JOHN LACKNER ("Employee").  This Agreement is intended to
replace the October 1, 1997 employment agreement between the parties in its


A.  The Company desires to engage Employee to perform certain services for the
    Company on the terms and conditions set forth herein.

B.  The Employee desires to perform certain services for the Company on the
    terms and conditions set forth herein.

C.  The Parties desire to amend their agreement, but for purposes of this
    Agreement, the effective date for the agreement shall remain the original
    effective date of October 1, 1997 (hereafter, the "Effective Date") so as
    not to affect certain rights which may already be accruing or accrued.

NOW, THEREFORE, the parties agree as follows:


    1.1  TERM:  For the term and subject to the conditions set forth in this
Agreement, the Company hereby employs Employee, for a period which shall begin
on the Effective Date and shall end on  October 1, 2002 or such earlier date of
termination as provided in this Agreement, and Employee hereby accepts such
employment.  As used herein, the phrase "Employment Term" refers to the entire
period of employment by the Company hereunder.

    1.2  EXTENSION OF TERM:  The term set forth in Section 1.1 may be extended
by written amendment to this Agreement signed by both parties.  Any continued
employment after the expiration of the Employment Term without such written
amendment shall be on an "at will" basis and not be construed to be part of this


    2.1  TITLE:  Subject to the provisions of this Agreement, Employee shall
serve the Company during the Employment Term as Senior Vice President, Chief
Operating Officer of the Company.  In this role, Employee shall have (i) oversee
limited Company operations, which shall include Manufacturing, Customer Service
and MIS, and (ii) perform such other duties and responsibilities  as may from
time to time be assigned to Employee by the Company's Board of Directors or by
the President.

    2.2  EMPLOYEE RESPONSIBILITIES:  During the Employment Term, Employee shall:

     (i) devote 100% of his business time, energy and skill to the affairs of
the Company as shall be necessary to perform the duties of such position and at
all times during the Employment Term shall have the powers and authority which
are necessary to enable him to discharge his duties in the office which he holds
and which are commonly incident to such office.  Employee shall promptly and


observe, comply with and conform to the policies, instructions, directions,
and requests of applicable senior management and the policies, rules and
regulations of the Company; and

    (ii)  serve the Company on a full-time, exclusive basis during the
Employment Term;

   (iii)  Employee shall work in the Company headquarters, currently
located at 521 Charcot Ave., San Jose, CA  95131.

    2.3  COMPANY RESPONSIBILITIES:  The Company shall provide Employee with
the compensation, bonuses, benefits and business expense reimbursement
specified elsewhere in this Agreement.


    During the Employment Term, as full compensation for all services to be
performed by Employee pursuant to this Agreement, the Company agrees to pay
Employee compensation and provide Employee with benefits as set forth in this
Section 3.

    3.1  BASE COMPENSATION:  The Company shall pay Employee base compensation
of $175,000 per annum (the "BASE COMPENSATION") during the Employment Term, with
such salary to be increased, at such times, if any, as the Board may deem
appropriate, to an amount determined by the Board, which increases shall be
consistent with the normal historical practices of Employer and the salary
adjustments for other senior managers of Employer.  The Base Compensation will
be paid in equal installments in conformity with the Company's normal payroll

    3.2  ARTWORK BONUS:  Employee shall receive from the Company an artwork
bonus of $5,000 at wholesale cost, from which to purchase any of the Company's
products. Employee shall receive one framed lithograph (S/N), which is produced
and distributed by the Employer and which the Employee shall select, per year of
employment, commencing after the first twelve months of employment. 

    3.3  ADDITIONAL BENEFITS:  In addition to his Base Compensation and Artwork
Bonus, Employee shall:

     (i) Be granted the following options:
         a.   15,000 shares of Media Arts Group, Inc. common stock at fair
              market value on the Effective Date, such options to be based on
              the terms of the Employee Stock Option Plan and vesting over 3
              years of employment (34% at one year from the Effective Date, 33%
              at two years from the Effective Date, and 33% at three years from
              the Effective Date);
         b.   18,000 shares of Media Arts Group, Inc. common stock at fair
              market value on October 29, 1997, such options to be based on the
              terms of the Employee Stock Option Plan and vesting over 3 years
              of employment (34% at one year from the Effective Date, 33% at
              two years from the Effective Date, and 33% at three years from
              the Effective Date);
    (ii) Receive a temporary living allowance of $2,500.00 per month, until the
         earlier of either a) when Employee's home sells or b) four (4) months
         from the Effective Date;

   (iii) Receive $500.00 auto allowance per full month of service;

    (iv) Receive $17,500.00 in relocation costs, related commissions and
         closing costs;

     (v) Receive a one-time moving allowance of $7,500.00;


    (vi) Participate in the Senior Manager Bonus Program or equivalent
         substitute program.  In 1998, Employee shall receive a bonus payment
         of $25,000.00;

   (vii) Participate in the Company Profit Sharing Plan, if any, pursuant
         to the conditions of the plan;

  (viii) Receive medical, dental and vision insurance coverage for Employee and
         his dependents under the Company's group medical insurance plan, at a
         cost as set forth in the plan;

    (ix) Receive $250,000 of life insurance coverage under a life insurance
         plan selected by the Employer, towards which Employer will contribute
         the lowest cost of coverage (i.e. the cost of coverage for someone of
         Employee's same age, without any pre-existing conditions or other risk
         factors which would increase premiums above the best rate available
         for that age);

     (x) Be entitled to vacation, sick time and personal time off under the
         Company's Flexible Time Off (FTO) plan at an accrual of 13.33 hours
         per full month of service; and

    (xi) Receive such additional benefits as the Company may from time to time
         in its sole discretion determine.


employment pursuant to this Agreement may be terminated at any time upon thirty
(30) days written notice by the Company upon the occurrence of any of the
following events;

     (i)  Death of employee;

    (ii)  Disability of Employee (as defined below).  For purposes of this
Agreement, the term "Disability" shall mean mental incapacity to perform his
duties in a normal manner for a total of three (3) months (whether or not
consecutive) in any twelve (12) month period during the term of this Agreement;

   (iii)  Justifiable Cause (as defined below) for such termination.   For
purposes of this Agreement, the term "Justifiable Cause" shall mean any of the

         (a)  If Employee shall fail to (i) perform any of his material
obligations under this Agreement and/or (ii) comply with reasonable directions
from the Board, which failure continues after the Company gives Employee written
notice of such failure and an opportunity for thirty (30) days to remedy such

         (b)  If Employee shall have engaged in willful misconduct in any
material matter affecting the Company or;

         (c)  If Employee shall be convicted of, or shall plead guilty or nolo
contendere to, a felony where such crime materially interferes with Employee's
ability to fulfill his duties under this Agreement or is otherwise materially
injurious to the Company.

    4.2  CORPORATE REORGANIZATION:  This Agreement shall not be terminated
by any voluntary or involuntary dissolution of the Company resulting from either
a merger or consolidation in which the Company is not the consolidated or
surviving corporation, or a transfer of all or substantially all of the stock or
assets of the Company.  In the event of any such merger or consolidation or
transfer of stock or assets, the Company's rights, benefits, and obligations
hereunder may be assigned to the surviving or resulting corporation or the
transferee of the Company's assets.


    4.3  EFFECT OF TERMINATION:   Upon any termination of this Agreement by the
Company pursuant to Section 4.1, the Company shall pay Employee (or in the event
of his death, his designated beneficiary) at the end of applicable notice period
the accrued and unpaid amount of the Base Compensation and Additional Benefits
payable pursuant to Section 3.1 3.2 and 3.3, prorated through the date of such
termination, and the Company shall have no further liability to Employee or his
estate pursuant to this Agreement, including without limitation, severance
compensation.  If this Agreement terminates for any reason other than by the
Company pursuant to Section 4.1, then, effective upon the termination of this
Agreement, the Company shall pay Employee such compensation as provided in
sections 3.1, 3.2,  and 3.3 of this Agreement, prorated through the date of
termination on a fair and equitable basis.  The Company shall pay Employee all
amounts due under this paragraph upon Employee's termination or as soon
thereafter as is reasonably practicable.

5.  RIGHT TO COMPANY MATERIALS:   Employee agrees that all styles, designs,
lists, materials, books, files, reports, correspondence, and other documents
("COMPANY MATERIALS") used, prepared, or made available to the Employee, shall
be and shall remain the property of the Company.  Upon termination of employment
or the expiration of this Agreement, all Company Materials shall be returned
immediately to the Company; provided, however, that Employee shall be entitled
to make and retain any copies thereof with respect to matters involving

6.  ANTISOLICITATION:   Employee promises and agrees that while this Agreement
continues in effect, he will not influence or attempt to influence customers or
suppliers of the Company or any of its present or future affiliates, either
directly or indirectly, to divert their business to any individual, partnership,
firm, corporation, or other entity then in competition with the business of the
Company, or any affiliates of the Company.

7.  SOLICITING EMPLOYEES:   Employee promises and agrees that while this
Agreement continues in effect and for one year thereafter, he will not directly
or indirectly solicit any of the employees of the Company or its affiliates to
work for or invest in, as the case may be, any business, individual,
partnership, firm, or corporation, that is in direct competition with the
Company or any of its affiliates.

understood that Employee may be dealing with trade secrets of the Company and
its affiliates, including but not limited to information system(s), inventions
and processes, all of a confidential nature, that concern the operations of the
Company or its affiliates and that are the Company's property and are used in
the course of the Company's business or that of its affiliates.  Employee
promises and agrees that he will not disclose to anyone, directly or indirectly,
either while this Agreement is in effect or at any time thereafter any trade
secrets learned in the course of his employment with the Company or its
affiliates.  Employee acknowledges that the Company may use all remedies,
including injunctive relief, in order to enforce the provisions of this
paragraph 8.

9.  CHOICE OF LAW AND JURISDICTION:   The validity, interpretation and effect
of this Agreement shall be governed by the laws of the State of California
applicable to agreements to be performed wholly within California by California

10. COUNTERPARTS:   This Agreement may be executed in counterparts, each of
which shall be an original, and all of which together shall constitute one and
the same instrument.

11. NOTICES:  Any notices, requests, demands and other communications under
this Agreement shall be in writing and shall be delivered to the person or sent
commercial courier service or postage prepaid, and addressed as follows:

The Company:       MEDIA ARTS GROUP, INC.
                   Attention: James F. Landrum, Jr.
                   521 CHARCOT  AVE.
                   SAN JOSE, CA 95131

To Employee:       JOHN LACKNER
                   31493 Bishop Gate
                   Westlake, OH 44145

Any party may from time to time change its address for the purposes of notices
to that party by a similar notice specifying a new address, but no such change
shall be deemed to have been given until actually received by the party sought
to be charged with its contents.  All notices and other communications required
or permitted under this Agreement which are addressed as provided in this
Section 11 if delivered personally, shall be effective upon delivery and if
delivered by mail or by commercial courier service, shall be effective five (5)
days after deposit in the United States mail, postage prepaid, registered or
certified, return receipt requested or upon receipt by such party from the
commercial courier service, as the case may be.

12. REPRESENTATIONS OF EMPLOYEE:  Employee represents and warrants that he is
now (and will continue to be during the entire term of this Agreement) legally
free to enter into this Agreement and to perform the duties required hereunder
and that neither the execution and delivery of this Agreement nor the
performance of his obligations hereunder will result in any breach or violation
of any other agreement or instrument to which he is a party.

13. ENTIRE AGREEMENT ; AMENDMENTS; ASSIGNMENTS:   This Agreement constitutes
the entire agreement and understanding of the parties with respect to the
matters dealt with herein (including the compensation and employment benefits to
which Employee is entitled for periods from and after the Effective Date), and
supersedes all negotiations, representations or agreements and all other oral,
written and other communication between them concerning the subject matter
hereof, and all prior arrangements with the Company concerning employment
compensation and benefits for periods from and after the Effective Date.  This
Agreement may be amended in whole or in part only by an agreement in writing
signed by all parties hereto. This Agreement and the rights and obligations
hereunder shall be deemed personal to Employee and Employee may not transfer,
pledge, encumber, assign, or alienate all or any part of this Agreement.

14  WAIVER:   The waiver by one party of a breach of any of the terms or
conditions of this Agreement shall not operate or be construed as a continuing
waiver or as a consent to or waiver of any other subsequent breach thereof.

15. FEES:   Should an action be instituted by either of the parties hereto in
any court of law or equity pertaining to the enforcement or interpretation of
this Agreement, the prevailing party shall be entitled to recover, in addition
to any judgment or decree rendered therein, all court costs and reasonable
attorneys' and experts' fees and expenses.

16. FURTHER ASSURANCES:  From and after the date of this Agreement, the parties
hereto shall cooperate in good faith to accomplish the objectives of this
Agreement and to that end agree to execute and/or deliver from time to time such
further instruments and documents as may be necessary and convenient to the
fulfillment of these purposes.  Should any documents conflict with this
Agreement, this Agreement shall control, unless such other document specifically
modifies or replaces this Agreement.

17. CAPTIONS:   The Section captions inserted in this Agreement are for
convenience of reference and are not intended to influence the interpretation of
this Agreement.

18. SEVERABILITY:  Should any part or portion of this Agreement or any
provision thereof be held invalid, illegal or void, the remainder of such part
or portion of this Agreement of provision thereof shall continue in full force
and effect as if the void, illegal or invalid part, portion, or provision had
been deleted therefrom or never included herein.  In the event that any portion
of this Agreement is declared invalid, the parties hereto agree to use their
best efforts to reform this Agreement in a manner consistent with their original


19. GENDER:   The use of the masculine pronoun hereunder shall not be
restrictive as to gender and shall be interpreted in all cases as the context
may require.

    IN WITNESS WHEREOF, the parties have executed this Agreement effective
October 10, 1997.


/s/ Craig A. Fleming
Craig A. Fleming, President


/s/ John Lackner


Source: OneCLE Business Contracts.