Exhibit 10.5

EXECUTION COPY

AMENDMENT NO. 11 TO THE LOAN AGREEMENT, AMENDMENT NO. 3 TO
THE SECURITY AGREEMENT AND AMENDMENT NO. 2 TO THE
PLEDGE AGREEMENT

                      THIS AMENDMENT NO. 11 TO THE LOAN AGREEMENT, AMENDMENT NO.
3 TO THE SECURITY AGREEMENT AND AMENDMENT NO. 2 TO THE PLEDGE AGREEMENT is made
as of September 25, 2002 (this “Agreement”) by and among RECOTON CORPORATION, a
New York corporation (“Recoton”), INTERACT ACCESSORIES, INC., a Delaware
corporation (“InterAct”), RECOTON AUDIO CORPORATION, a Delaware corporation
(“Audio”), AAMP OF FLORIDA, INC., a Florida corporation (“AAMP”), RECOTON HOME
AUDIO, INC., a California corporation (“RHAI”), RECOTON ACCESSORIES, INC., a
Delaware corporation (“Recoton Accessories”) and RECOTON MOBILE ELECTRONICS,
INC., a Delaware corporation (“Mobile Electronics”) and together with Recoton,
InterAct, Audio, AAMP, RHAI and Recoton Accessories collectively, the
“Borrowers”, the Guarantors (the Borrowers and the Guarantors are sometimes
collectively referred to herein as the “Loan Parties” or the “Pledgors” with
respect to the Pledge Agreement (as defined herein)), the Lenders, HELLER
FINANCIAL, INC., a Delaware corporation, for itself as a Lender and as
Administrative Agent and Senior agent and GENERAL ELECTRIC CAPITAL CORPORATION,
a New York corporation for itself as a Lender and as Collateral Agent and
Syndication Agent (the Administrative Agent, Senior Agent, Collateral Agent and
Syndication Agent are sometimes referred to herein as the “Agents”) and is made
with reference to the Loan agreement dated as of October 31, 2000 (as amended by
the (i) Consent and Amendment No. 1 to the Credit Agreement and Amendment No. 1
to the Security Agreement, dated as of February 7, 2001, (ii) Amendment No. 2 to
the Credit Agreement, dated as of May 10, 2001, (iii) Consent and Amendment No.
3 to the Loan Agreement, Amendment No. 2 to the Security agreement and Amendment
No. 1 to the Pledge Agreement, dated as of July 3, 2001, (iv) Fourth Amendment
to Loan Agreement, dated as of February 26, 2002, (v) Waiver, Consent and
Amendment No. 5 to the Loan Agreement, dated as of March 29, 2002, (vi) Waiver
and Amendment No. 6, dated as of August 28, 2002 (“Waiver and Amendment No. 6”),
(vii) Amendment No. 7 to the Loan Agreement, dated as of September 13, 2002,
(viii) Amendment No. 8 to the Loan Agreement dated as of September 18, 2002,
(ix) Amendment No. 9 to the Loan Agreement dated as of September 20, 2002 and
(x) Amendment No. 10 to the Loan Agreement dated as of September 23, 2002, as
the same may be further amended, supplemented, restated or otherwise modified
from time to time, the “Loan Agreement”), among the Borrowers, the Guarantors,
the Lenders and the Agent. Capitalized terms used herein and not otherwise
defined herein shall have the meanings ascribed to such terms in the Loan
Agreement as amended hereby, or if not defined therein, in the Pledge Agreement
(as defined herein) as amended hereby.

R E C I T A L S

                      WHEREAS, the Borrowers, the Guarantors, the Lenders and
the Agents have entered into the Loan Agreement;

                      WHEREAS, the Lenders have made Loans to the Borrowers
pursuant to the terms of the Loan Agreement;

                      WHEREAS, the Borrowers, the Guarantors and the Senior
Agent have entered into that certain Security Agreement, dated as of October 31,
2000, as amended by that certain Consent and Amendment No. 1 to the Credit
Agreement and Amendment No. 1 to the Security Agreement, dated as of February 7,
2001 and that certain Consent and Amendment No. 3 to the Loan Agreement,
Amendment No. 2 to the Security agreement and Amendment No. 1 to the Pledge
Agreement, dated as of July 3, 2001, (and as amended, restated, supplemented or
otherwise modified from time to time the “Security Agreement”);

                      WHEREAS, the Pledgors and the Senior Agent have entered
into the Pledge Agreement, dated as of October 31, 2000, as amended by that
certain Consent and Amendment No. 3 to the Loan Agreement, Amendment No. 2 to
the Security agreement and Amendment No. 1 to the Pledge Agreement, dated as of
July 3, 2001 (and as amended, restated, supplemented or otherwise modified from
time to time the “Pledge Agreement”);

                      WHEREAS, the Borrowers expressly reaffirm all of the Loan
Documents and the debt and other obligations thereunder, the Borrowers agree
that nothing contained herein shall operate to release the Borrowers or any
other person or persons from their liability to keep and perform the provisions,
conditions, obligations, and agreements contained in the Loan Documents, except
as may be herein modified, and the Borrowers hereby reaffirm that each and every
provision, condition, obligation and agreement in such documents shall continue
in full force and effect, except as may be herein modified;

                      WHEREAS, the validity, priority and perfection of all
mortgages, security interests and other liens granted or created by the Loan
Documents is hereby acknowledged and confirmed by the Borrowers, and the
Borrowers agree that such documents shall continue to secure the Loans and the
other Obligations, as may be amended by this Agreement, without any change, loss
or impairment of the priority of such mortgages, security interests or other
liens;

                      WHEREAS, the Borrowers have requested that the Lenders
agree to amend certain provisions of the Loan Agreement; and

                      WHEREAS, the Lenders have agreed to amend certain
provisions of the Loan Agreement as specifically set forth herein;

                      NOW, THEREFORE, in consideration of the premises and the
mutual agreements contained herein and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:

                      Section 1. Certain Amendments to the Loan Agreement. As of
the Effective Date (as defined herein), the Loan Agreement is hereby amended as
follows:

                                (a) The first two sentences of the first
paragraph of Section 2.1(B) of the Loan Agreement are hereby amended and
restated in their entirety as follows:

  “Each Revolving Loan Lender severally agrees to lend to Borrowers from time to
time its Pro Rata Share of each Revolving Advance. The aggregate amount of all
Revolving Loan Commitments shall not exceed (i) $165,000,000 at any time during
the period beginning on September 25, 2002 and ending on October 4, 2002 or (ii)
$160,000,000 at any time thereafter, in each case as such amount may be reduced
from time to time pursuant to subsections 2.4(B)(5), 2.4(B)(6) or 2.4(C).”  

                                 (b) Clause (b) of Section 2.1(B)(2) of the Loan
Agreement is hereby amended and restated in its entirety as follows:

  ““(b) up to the lesser of (i) (A) 70% of Eligible Inventory during the period
beginning on September 25, 2002 and ending the earlier of the date on which the
AAMP Bridge Loan is made and October 4, 2002 and (B) 65% of Eligible Inventory
at all times thereafter and (ii) (A) 100% of the Appraised Value of Eligible
Inventory for the period beginning August 19, 2002 and ending October 4, 2002,
(B) 95% of the Appraised Value of Eligible Inventory for the period beginning
October 5, 2002 and ending October 30, 2002, (C) 90% of the Appraised Value of
Eligible Inventory for the period beginning October 31, 2002 and ending November
29, 2002, and (D) 85% of the Appraised Value of Eligible Inventory at all time
on and after November 30, 2002;"  

                                 (c) Section 11.1 of the Loan Agreement is
amended to delete in its entirety the definition of “Permitted Overadvance” and
to replace such definition with the following definition:

  ““ “‘Permitted Overadvance’ means an overadvance of an amount equal to
$15,250,000, which shall be permanently reduced (i) to $12,750,000 on October 4,
2002 and (ii) to zero on October 31, 2002.”  

                      Section 2. Amendment to the Security Agreement. As of the
Effective Date (as defined herein), Section 2 of the Security Agreement is
hereby amended to delete the second paragraph thereof that begins with
“Notwithstanding anything herein to the contrary”.

                      Section 3. Certain Amendments to the Pledge Agreement. As
of the Effective Date (as defined herein), the Pledge Agreement is hereby
amended as follows:

                                 (a) Clause (a)(ii) of Section 2 of the Pledge
Agreement is hereby amended by deleting the phrase “65% of the Capital Stock of
the first tier Foreign Subsidiaries” and substituting therefor the phrase “all
of the Capital Stock of the first tier Foreign Subsidiaries”.

                                 (b) In connection with the amendment to the
Pledge Agreement in clause (a) of this Section, each Pledgor hereby pledges,
assigns, hypothecates, transfers, delivers and grants to the Senior Agent, on
behalf of the Agents, Lenders, Subordinated Agent and Subordinated Creditors, a
first lien on and first priority security interest in all of the Capital Stock
of the first tier Foreign Subsidiaries held by such Pledgor and not previously
pledged to the Senior Agent, together with all of the certificates evidencing
such shares of Capital Stock, and all options, warrants and other rights to
purchase the shares of Capital Stock of such Foreign Subsidiaries held by such
Pledgor together with the Capital Stock of such Foreign Subsidiary underlying
such options, warrants and other rights.

                      Section 4. Representations and Warranties. The Loan
Parties hereby represent and warrant to each Agent and each Lender that after
giving effect to this Agreement:

                                 (a) no Default or Event of Default has occurred
and is continuing on and as of the date hereof;

                                 (b) the representations and warranties of the
Loan Parties and the other Loan Parties contained in the Loan Agreement and the
other Loan Documents are true and correct on and as of the date hereof as if
made on and as of the date hereof, except to the extent such representations and
warranties expressly relate to a different date; and

                                 (c) the execution and delivery by the Loan
Parties to this Agreement and the performance by the Loan Parties of all of
their respective agreements and obligations under this Agreement and the Loan
Agreement as amended hereby, respectively, are within the power and authority of
the Loan Parties and have been duly authorized by all necessary action on the
part of the Loan Parties, and that the execution and delivery by the Loan
Parties, of this Agreement and the performance by each of the transactions
contemplated hereby will not contravene any term or condition set forth in any
material agreement or instrument to which each is a party or by which each is
bound.

                      Section 5. Effectiveness and Conditions Precedent. This
Agreement shall become effective on September 25, 2002 (the “Effective Date”),
upon the Administrative Agent’s receipt of counterparts of this Agreement
executed and delivered by each of the Lenders, the Borrowers and the Guarantors
(which executions and deliveries may be effected by delivery and receipt by
facsimile transmission).

                      Section 6. Status of Loan Documents; Additional
Representations and Warranties.

                                 (a) This Agreement is limited solely for the
purposes and to the extent expressly set forth herein, and, except as expressly
provided hereby, (i) the terms, provisions and conditions of the Loan Documents
and (ii) the Liens granted under the Loan Documents shall continue in full force
and effect and are hereby ratified and confirmed in all respects.

                                 (b) No waiver or amendment of any terms or
provisions of the Loan Agreement made hereunder shall relieve the Loan Parties
from complying with any other term or provision of the Loan Agreement or any
other Loan Document.

                                 (c) No action taken by any Lender, the
Administrative Agent or the Collateral Agent prior to, on or after the date
hereof shall constitute a waiver of or modification of any term or condition of
any of the Loan Documents, except as specifically set forth herein, or prejudice
any rights which the Administrative Agent, the Collateral Agent or any of the
Lenders may now have as of the date hereof or may have in the future under or in
connection with the Loan Documents, including without limitation all rights and
remedies in connection with Defaults, Events of Default and failures of
conditions precedent to the making of Loans and the issuance of Lender Letters
of Credit that have occurred and are continuing, all of which rights and
remedies each Lender, the Administrative Agent and the Collateral Agent hereby
expressly reserve.

                                 (d) The Loan Parties represent and warrant to
each of the other parties hereto that except as heretofore disclosed in writing
by the Loan Parties to the Lenders, as of the date hereof, there is no pending
or, to the knowledge of the Loan Parties, threatened action, suit, proceeding,
governmental investigation or arbitration against or affecting any of the Loan
Parties or any property of any of the Loan Parties that is likely to have a
Material Adverse Effect.

                      Section 7. Certain Covenants and Agreements of the
Borrowers. The parties hereto hereby agree that the failure of the Borrowers to
comply with any of the following provisions in this Section 7, or with any of
the provisions of Section 4 of Waiver and Amendment No. 6, will result in an
immediate Event of Default under the Loan Agreement notwithstanding the
provisions of subsection 8.1(E) of the Loan Agreement or any other grace period
or right to cure contained in the Loan Agreement or any other Loan Document.

                                 (a) On or before September 30, 2002, the
Borrowers shall provide to the Administrative Agent, with a copy to each Lender,
an alternative plan of action, in form, scope and substance acceptable to the
Requisite Lenders, with respect to the disposition of InterAct International in
the event that a sale of InterAct International as a going concern basis does
not occur.

                                 (b) On or before October 10, 2002, the
Borrowers shall provide to the Administrative Agent, with a copy to each Lender,
a strategic action plan, in form, scope and substance acceptable to the
Requisite Lenders, with respect to improvements in the Borrowers’ financial
performance, including, without limitation, detailed plans for reductions in the
Borrowers’ SG&A expenses, office closings, improvements within the financial
staff of the Borrowers, and improvements in the financial reporting of the
Borrowers.

                                 (c) On or before October 31, 2002, the
Borrowers shall cause AAMP to enter into a credit facility subject to terms and
conditions approved in writing by all of the Lenders and pursuant to which, on
or before such date, (i) initial loans are made to or for the benefit of AAMP in
an aggregate principal amount of not less than $15,000,000 and (ii)
notwithstanding any contrary provisions of the Loan Agreement, the proceeds of
such loans (net of fees and expenses directly related to such credit facility)
are applied in a manner acceptable to all of the Lenders.

                                 (d) The Borrowers shall, beginning on the
Effective Date, provide to the Administrative Agent, with a copy to each Lender,
a weekly report of Zolfo Cooper (the “Borrower Consultant”), in form, scope and
substance reasonably acceptable to the Administrative Agent, which details the
progress made by the Borrower Consultant with respect to improvements to the
Borrowers’ cash flows, borrowing availability, financial performance and
operations during such week.

                                 (e) The Borrowers shall, beginning on the
Effective Date, arrange for representatives of Jeffries & Co. to conduct
telephone conferences on a weekly basis with the Administrative Agent and the
Lenders to provide updates as to the Borrowers’ progress with respect to the
disposition of their InterAct, AAMP, German, NHT and certain other business
units.

                                 (f) On or before October 15, 2002, the
Borrowers shall cause Jeffries & Company to prepare offering memoranda marketing
the sale of the Borrowers’ German business units and to distribute such offering
memoranda to potential purchasers with copies of each such distribution sent to
the Administrative Agent and the Lenders.

                                 (g) On or before September 30, 2002, the
Borrowers shall cause the $16,000,000 Irrevocable Standby Letter of Credit No.
MAI91373 issued by Commerzbank Aktiengesellschaft, Filale Mainz to be amended to
permit the Administrative Agent to draw the full amount of such letter of credit
at any time without condition (whether or not the obligations due the
Administrative Agent supported by such letter of credit are in default).

                                 (h) On or before November 30, 2002, Recoton
International Holdings, Inc. shall execute and deliver all pledge agreements,
stock powers, financing statements, financing change statements, charges of
shares, instruments of transfer and resolutions, shall deliver to the Senior
Agent all stock certificates and legal opinions, shall cause all applicable
notations to be recorded on stock registers, shall engage local counsel and
shall execute and deliver such other documents and do such other acts or things
as the Senior Agent may reasonably request in order to ensure that the security
interest granted to the Senior Agent in Section 3(b) with respect to the Capital
Stock of Recoton Germany will be enforceable as a matter of German law.

                      Section 8. Miscellaneous.

                                 (a) No Waiver, Cumulative Remedies. No failure
or delay or course of dealing on the part of any Agent or any Lender in
exercising any right, power or privilege hereunder shall operate as an express
or implied waiver thereof, nor shall any single or partial exercise of any such
right, power or privilege preclude any other or further exercise thereof or the
exercise of any other right, power or privilege hereunder. The rights, powers
and remedies herein expressly provided are cumulative and not exclusive of any
rights, powers or remedies which the Lenders would otherwise have. No notice to
or demand on the Borrowers or Guarantors in any case shall entitle the Borrowers
or Guarantors to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of the Lenders to any other
or further action in any circumstances without notice or demand.

                                 (b) Ratification, Etc. Except as expressly
provided for herein, the Loan Agreement and all documents, instruments and
agreements related thereto, including but not limited to, the Security
Documents, are hereby ratified and confirmed in all respects and shall continue
in full force and effect. The Loan Agreement and this Agreement shall be read
and construed as a single agreement. This Agreement shall constitute one of the
Loan Documents and the obligations of the Borrowers and Guarantors under this
Agreement shall constitute Obligations for all purposes of the Loan Documents.
All references in the Loan Agreement, the Loan Documents or any related
agreement or instrument to the Loan Agreement shall hereafter refer to the Loan
Agreement as amended hereby.

                                 (c) Expenses. The Borrowers agree to pay and
reimburse the Administrative Agent and Lenders for all of their costs and
expenses (including, without limitation, costs and expenses of legal counsel and
Richter Consulting, Inc.) in connection with this Agreement.

                                 (d) Bankruptcy; Insolvency. The Borrowers
represent and warrant that, on and as of the date hereof, no proceeding has been
filed or commenced by or against the Borrowers for dissolution or liquidation,
or by or against the Borrowers voluntarily or involuntarily terminating or
dissolving or being terminated or dissolved; nor does there exist insolvency of
the Borrowers, nor do the Borrowers fail to pay their debts as they become due
in the ordinary course of business; nor has a creditor’s committee been
appointed for the business of the Borrowers; nor have the Borrowers made an
assignment for the benefit of creditors, or filed a petition in bankruptcy or
for reorganization or to effect a plan of arrangement with creditors; nor have
the Borrowers applied for or permitted the appointment of a receiver or trustee
for any or all of their property, assets or rights; nor are the Borrowers aware
of any such receiver or trustee being appointed for any or all of their
property, assets or rights; nor has any of the above actions or proceedings
whatsoever been commenced by or against any other party liable for the
Obligations.

                                 (e) Headings Descriptive. The headings of the
several Sections and subsections of this Agreement are inserted for convenience
only and shall not in any way affect the meaning or construction of any
provision.

                                 (f) Severability. In case any provision in or
obligation under this Agreement shall be invalid, illegal or unenforceable in
any jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.

                                 (g) Counterparts. This Agreement may be
executed and delivered in any number of counterparts and by the different
parties hereto on separate counterparts, each of which when so executed and
delivered shall be an original, but all of which shall together constitute one
and the same instrument. A complete set of counterparts shall be lodged with
each of Recoton and the Administrative Agent.

                                 Section 9. Release. The Borrowers and each of
the Guarantors hereby acknowledges and confirms that (i) it does not have any
grounds, and hereby agrees not to challenge (or to allege or to pursue any
matter, cause or claim arising under or with respect to), in any case based upon
acts or omissions of any of the Agents or Lenders occurring prior to the date
hereof or facts otherwise known to it as of the date hereof, the effectiveness,
genuineness, validity, collectibility or enforceability of the Loan Agreement or
any of the other Loan Documents, the Obligations, the Liens securing such
Obligations, or any of the terms or conditions of any Loan Document (it being
understood that such acknowledgement and confirmation does not preclude the
Borrowers or the Guarantors from challenging the Agents’ or any Bank’s
interpretation of any term or provision of the Loan Agreement or other Loan
Document) and (ii) it does not possess (and hereby forever waives, remises,
releases, discharges and holds harmless the Agents, the Lenders, and their
respective affiliates, stockholders, directors, officers, employees, attorneys,
agents and representatives and each of their respective heirs, executors,
administrators, successors and assigns (collectively, the “Indemnified Parties”)
from and against, and agrees not to allege or pursue) any action, cause of
action, suit, debt, claim, counterclaim, cross-claim, demand, defense, offset,
opposition, demand and other right of action whatsoever, whether in law, equity
or otherwise (which it, all those claiming by, through or under it, or its
successors or assigns, have or may have) against the Indemnified Parties, or any
of them, by reason of, any matter, cause or thing whatsoever, with respect to
events or omissions occurring or arising on or prior to the date hereof and
relating to the Loan Agreement or any of the other Loan Documents (including,
without limitation, with respect to the payment, performance, validity or
enforceability of the Obligations, the Liens securing the Obligations or any or
all of the terms or conditions of any Loan Document) or any transaction relating
thereto; provided, however, that no Borrower nor Guarantor hereby releases or
holds harmless any Indemnified Party for actions or omissions by any such
Indemnified Party constituting, or losses or expenses directly resulting from,
the gross negligence or willful misconduct of such Indemnified Party as
determined by a final judgment of a court of competent jurisdiction.

                      Section 10. Governing Law. THIS AGREEMENT SHALL BE
GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK.

* * * *

                      IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their respective duly authorized
officers as of the date first written above.

BORROWERS/PLEDGORS: RECOTON CORPORATION

By: /s/ Arnold Kezsbom                                                       
Name: Arnold Kezsbom
Title:   Executive Vice President - Finance

INTERACT ACCESSORIES, INC.
RECOTON AUDIO CORPORATION
AAMP OF FLORIDA, INC.
RECOTON HOME AUDIO, INC.
RECOTON ACCESSORIES, INC.
RECOTON MOBILE ELECTRONICS, INC.

By: /s/ Arnold Kezsbom                                                       
Name: Arnold Kezsbom
Title:   Vice President

GUARANTORS/PLEDGORS: CHRISTIE DESIGN CORPORATION
RECOTON INTERNATIONAL HOLDINGS, INC.
RECOTON JAPAN, INC.
RECONE, INC.
RECOTON CANADA LTD.
INTERACT CANADA, LTD.
INTERACT INTERNATIONAL, INC.
INTERACT HOLDINGS, INC.
INTERACT TECHNOLOGIES, INC.

By: /s/ Arnold Kezsbom                                                       
Name: Arnold Kezsbom
Title:   Vice President

LENDERS: HELLER FINANCIAL, INC.,
individually and as Senior Agent and
Administrative Agent

By: /s/ Hugh Wilder                                                       
Name: Hugh Wilder
Title:   Senior Vice President

  GENERAL ELECTRIC CAPITAL CORPORATION,
Syndication Agent

By: /s/ Hugh Wilder                                                       
Name: Hugh Wilder
Title:   Authorized Signatory

  BANK OF AMERICA, N.A.

By: /s/ Valerie Peppe                                                       
Name: Valerie Peppe
Title:   Assistant Vice President

  THE CIT GROUP / BUSINESS CREDIT, INC.

By: /s/ Vincent Belcastro                                                       
Name: Vincent Belcastro
Title:   Vice President

  GUARANTY BUSINESS CREDIT CORPORATION

By: /s/ James E. Casper                                                       
Name: James E. Casper
Title:   Senior Vice President

  FOOTHILL CAPITAL CORPORATION

By: /s/ Robert J. Cambora                                                       
Name: Robert J. Cambora
Title:   Senior Vice President

  CITIZENS BUSINESS CREDIT

By: /s/ Thomas D. Opie                                                       
Name: Thomas D. Opie
Title:   Vice President

  WASHINGTON MUTUAL BANK

By: /s/ Terri K. Lins                                                       
Name: Terri K. Lins
Title:   Vice President

  SIEMENS FINANCIAL SERVICES, INC.

By: /s/ Frank Amodio                                                       
Name: Frank Amodio
Title:   Vice President - Credit

  GMAC BUSINESS CREDIT LLC

By: /s/ Alexander J. Chobot                                            
          
Name: Alexander J. Chobot
Title:   Vice President

  U.S. BANK NATIONAL ASSOCIATION

By: /s/ Suzanne Geiger                                                       
Name: Suzanne Geiger
Title:   Senior Vice President