AMENDMENT NO. 1 TO LICENSE AGREEMENT


     This  Amendment No. 1 ("Amendment  No. 1") to the License  Agreement  dated
January 2, 2001 "Agreement") is entered into between ABC HOME FURNISHINGS, INC.,
a New York corporation  ("LICENSOR"),  and HARVEY ELECTRONICS,  INC., a New York
corporation,  having its principal office at Lyndhurst, New Jersey ("LICENSEE").
Sometimes  LICENSOR  and  LICENSEE  are  referred  to in this  Amendment  No.  1
individually as a "party" and collectively as the "parties."

     The parties agree to the following:

     A. LICENSOR and LICENSEE  entered into the Agreement  that provided for the
License of approximately  4,500 square feet of display space in LICENSOR's store
at 888 Broadway, New York, New York for a term that commenced on January 1, 2001
and will end on December 31, 2003.

     B.  LICENSOR  and  LICENSEE  have  expressed  an interest  in renewing  and
extending the term of the Agreement on the terms and conditions set out herein.

     THEREFORE,  for and in  consideration  of the mutual promises  contained in
this Amendment No. 1 and other good and valuable  consideration  set out in this
Amendment No. 1, the receipt and sufficiency of which is hereby acknowledged, it
is agreed as follows:

     1.  Extension  of  Term.  The  parties  agree  to  extend  the  term of the
Agreement,  which is currently  scheduled to end on December 31, 2003 for a term
of three (3) years  commencing  on January 1, 2004 and  ending on  December  31,
2006.

     2. Early  Termination  Provision.  LICENSEE will have the right at any time
after January 31, 2005 to terminate the Agreement  early without penalty so long
as LICENSEE  provides  LICENSOR  with at least one hundred and twenty days prior
written notice.  However,  if the termination date will end during the months of
October,  November,  or December,  LICENSEE  agrees to provide  LICENSOR with at
least one hundred and eighty days' prior written notice.

     3. Credit Card Charges.  The credit card charges set out in paragraph  4(b)
of the Agreement are hereby amended to increase from two and one-quarter percent
(2.25%) to two and  one-half  percent  (2.5%) and all other  provisions  of that
paragraph remain intact.

     4. Cross-Selling. LICENSOR and LICENSEE will each make available the use of
their  respective  mailing  lists and  participate  in  cross-promotions  as the
parties agree from time-to-time.

     5. License Fees.  The parties agree that  paragraph 4(d) on license fees is
amended to provide  that  instead of  LICENSEE  paying  LICENSOR  ten percent of
LICENSEE's net sales in excess of  $3,000,000,  that LICENSEE shall pay LICENSOR
8.5%  of net  sales  from  $3,000,001  to  $5,000,000,  10% on  net  sales  from
$5,000,001 to $6,000,000,  11% on net sales from  $6,000,001 to $8,000,000,  and
12% on net sales above $8,000,001.  In all other respects paragraph 4(d) remains
intact.

     6. Display Window. LICENSOR agrees to provide LICENSEE with a double window
display on 19th Street  subject to  LICENSOR's  approval of the  display,  which
approval will not be unreasonably  withheld.  LICENSEE agrees that LICENSOR will
have the right to select  what will be  displayed  on the TV that is part of the
window  display.  Prior to the  installation  of the window  display  referenced
herein,  LICENSOR will install a shatter-proof  glass window,  the cost of which
window and  installation  will be paid for  one-half by LICENSOR and one-half by
LICENSEE.  In the event of any act of vandalism,  theft,  or attempted  theft of
items  in such  display  window  or  damage  to  such  items,  LICENSEE  will be
responsible for the loss of any television or other electronics it places in the
display  window and the cost of repair and  replacement  of the display  window.
Notwithstanding  anything  contained  herein to the contrary,  the parties agree
that the plasma TV that is part of the window  display  will at all times remain
the property of LICENSEE.

     7. Plasma TV Display.  LICENSOR agrees to provide LICENSEE with an area for
the  display of a plasma TV on the main  floor of the Store at a location  to be
mutually  agreed  upon by the  parties,  which  display  is to be  appropriately
identified  with  LICENSEE's  name and the location of the Licensed Space within
the Store. LICENSEE agrees that LICENSOR will have the right to select what will
be displayed  on the TV that is part of such plasma TV display.  Notwithstanding
anything contained herein to the contrary,  the parties agree that the plasma TV
that is  referenced in this  paragraph  will at all times remain the property of
LICENSEE.

     8. Sign. LICENSOR agrees to work with LICENSEE to provide better visibility
for LICENSEE's sign near the Licensed Space.

     9.  Visibility.  LICENSOR and  LICENSEE  agree to cooperate in working with
another  licensee,  Besana,  to install  one plasma TV in  Besana's  wall system
display near the entrance to the Licensed  Space to provide  greater  visibility
for the display of LICENSEE's  products.  The exact  location of such display is
subject to LICENSEE's approval. Notwithstanding anything contained herein to the
contrary,  the  parties  agree  that the  plasma TV that is  referenced  in this
paragraph will at all times remain the property of LICENSEE.

     10. TV Wall Display.  LICENSEE  agrees to endeavor in good faith to get one
or more of its vendors to supply six plasma TV's at no cost for a planned Spring
2004  display/installation  on the main  floor of the  Store,  or at a  mutually
agreed-upon location on the main floor of the Store, which  display/installation
will  provide  appropriate  identification  of LICENSEE  and the location of the
Licensed  Space in the Store.  The  installment  of this  display may be delayed
until later in the year. If such good-faith  effort is not successful,  LICENSEE
agrees to purchase the plasma TV's at its cost and LICENSEE  agrees to share the
cost of obtaining the plasma TV's equally with LICENSOR. LICENSOR agrees, at its
cost,  to  construct  the wall  display/installation,  with the location of such
display/installation  to be  determined  by LICENSOR.  If the display  using the
televisions  is not in place for at least twelve  continuous  months  during the
term of this Agreement,  LICENSOR will return three of the plasma televisions to
LICENSEE and the other three  plasma  televisions  will belong to  LICENSOR.  If
three of the plasma  televisions  have not already been  returned to LICENSEE by
the date of the termination of this Agreement, all six of the plasma televisions
will belong to LICENSOR.  LICENSEE  agrees that  LICENSOR will have the right to
select  what  will be  displayed  on each of the TV's that are part of such wall
display/installation.

     11.  Mutual  Waiver  of  Subrogation.  As  provided  for in the  underlying
Agreement,  to the extent  permitted by state law,  LICENSEE  agrees to have its
insurers on any insurance  coverages that LICENSEE is required to maintain under
the terms of this Agreement waive  subrogation  rights and provide proof of same
to LICENSOR in the form of a written  notation on the  certificate of insurance.
Likewise,  to the extent  permitted  by state law,  LICENSOR  agrees to have its
insurers on any insurance  coverages that LICENSOR is required to maintain under
the terms of this  Agreement  waive  subrogation  rights  with  respect  to both
property damage and personal injury and provide proof of same to LICENSEE in the
form of a written notation on the certificate of insurance.

     12. Entire  Agreement.  This Amendment No. 1 contains the entire  agreement
between the  parties  relating to the  subject  matter of this  Amendment  No. 1
(except documents,  agreements,  and instruments delivered or to be delivered in
accordance   with  the  express  terms  of  this   Amendment  No.  1.  Any  oral
representations  or modifications  concerning this Amendment No. 1 will be of no
force or effect. Only a subsequent  modification in writing, signed by the party
to be charged and  supported  by  consideration  will be effective to amend this
Amendment No. 1.

     13. Miscellaneous.

     (a) With the exceptions noted above,  the Agreement is hereby  incorporated
into this  Amendment No. 1 by reference and made a part of this  Amendment No. 1
for the duration of its term and any renewal and extensions provided for in this
Amendment No. 1.

     (b) The parties further ratify and affirm the Agreement, as amended by this
Amendment No. 1, and each and every provision of same.

     (c) If there is any conflict  between the terms of this Amendment No. 1 and
the terms of the  Agreement,  the terms of this  Amendment  No. 1 will  control.
LICENSOR  and  LICENSEE  agree that all the terms of the  Agreement  will apply,
where applicable, to the Warehouse Licensed Space.

     (d) All  terms  used  but not  defined  in this  Amendment  No.  1 have the
meanings ascribed to such terms in the Agreement.


     IN WITNESS WHEREOF, the parties have signed this Amendment No. 1 on the day
of December, 2003.


LICENSOR:                               LICENSEE:
ABC HOME FURNISHINGS, INC.              HARVEY ELECTRONICS, INC.


By:/s/ David Lauber                     By:/s/ Franklin C. Karp
   ----------------                        --------------------
   David Lauber, CFO                       Franklin C. Karp, President