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                                                                    Exhibit 10.7




                             EQUITY MARKETING, INC.
                           THIRD AMENDMENT AND WAIVER
                               TO CREDIT AGREEMENT

            This THIRD AMENDMENT AND WAIVER TO CREDIT AGREEMENT (this
"AGREEMENT") is dated as of September 30, 2002 and entered into by and among
Equity Marketing, Inc., a Delaware corporation ("COMPANY"), the financial
institutions listed on the signature pages hereof ("LENDERS") and Bank of
America, N.A., as administrative agent for Lenders ("ADMINISTRATIVE AGENT"), and
is made with reference to that certain Credit Agreement dated as of April 24,
2001, as amended by that certain First Amendment dated as of November 14, 2001,
and that certain Second Amendment dated as of February 8, 2002 (as so amended,
the "CREDIT AGREEMENT"), by and among Company, Lenders and Administrative Agent.
Capitalized terms used herein without definition shall have the same meanings
herein as set forth in the Credit Agreement.

                                    RECITALS

            WHEREAS, Company and Lenders desire to amend the Credit Agreement as
set forth below; and

            WHEREAS, Company and Lenders desire that Lenders waive Company's
compliance with (i) subsection 7.04(a) of the Credit Agreement as it relates to
Company's forgiveness of the RSI Note, (ii) subsection 7.05(d) of the Credit
Agreement as it relates to the acquisition of certain assets of Promotional
Marketing, L.L.C., d.b.a. Upshot as described in the transaction updated dated
May 3, 2002 (the "UPSHOT ACQUISITION"), and (iii) subsection 7.15 of the Credit
Agreement as it relates to Company's execution and substitution of the RSI
Supply Agreement.

            NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:

      SECTION 1. AMENDMENTS TO CREDIT AGREEMENT

            1.1   AMENDMENTS TO SECTION 1: DEFINITIONS AND ACCOUNTING TERMS

            (A)   Subsection 1.01 of the Credit Agreement is hereby amended by
deleting the proviso at the end of definition of "Borrowing Base" in its
entirety and substituting the following therefor:

            "provided that Administrative Agent, in the exercise of its
            Permitted Discretion, may, with the consent of either Borrower or
            Required Lenders, (i) increase or decrease reserves against Eligible
            Accounts Receivable and Eligible Inventory, and (ii) reduce the
            advance rates (including the Eligible Inventory Advance Rate)
            provided in this definition, or restore such advance rates to any
            level equal to or below the advance rates in effect as of the
            Closing Date; provided, however, that the amount set forth in clause
            (c) above shall not exceed the lesser of (x) 40% of the Borrowing
            Base and (y) $6,000,000."

            (B)   Subsection 1.01 of the Credit Agreement is hereby amended by
deleting the definition of "RSI Supply Agreement" in its entirety and
substituting the following therefor:

            "RSI Supply Agreement " means that certain Master Supply Agreement,
      dated as of May 15, 2002, by and between RSI and Borrower."

            (C)   Subsection 1.01 of the Credit Agreement is hereby further
amended by deleting clause (f)(ii) from the definition of "Permitted
Acquisition" in its entirety and substituting the following therefor:

                  "(ii) the Consolidated Leverage Ratio will not exceed the
            maximum Consolidated Leverage Ratio set forth in Section 7.12 for
            the next succeeding Fiscal Quarter minus 0.25;"


            (D)   Subsection 1.01 of the Credit Agreement is hereby further
amended by deleting from the definition of "Eligible Inventory" the phrase "(it
being understood that the amount of Eligible Inventory shall not exceed
$6,000,000 at any time)".

            1.2   AMENDMENTS TO SECTION 7: NEGATIVE COVENANTS

            (A)   Subsection 7.01(i) of the Credit Agreement is hereby amended
by deleting it in its entirety and substituting the following therefor:

            "(i)  Indebtedness of Borrower to any of its Subsidiaries or of any
      Subsidiary of Borrower to Borrower or any other Subsidiary, in each case
      as permitted under Section 7.05(d), not exceeding $1,000,000 in the
      aggregate at any time outstanding."

            (B)   Subsection 7.02(c) of the Credit Agreement is hereby amended
by deleting it in its entirety and substituting the following therefor:

                  "No Further Negative Pledges. Except with respect to (i)
      specific property encumbered to secure payment of particular Indebtedness
      or to be sold pursuant to an executed agreement with respect to a
      Disposition, (ii) any debt facility of a Foreign Subsidiary in connection
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      with Indebtedness of such Foreign Subsidiary permitted by subsection
      7.01(d), (iii) clauses in the security agreement between Borrower and
      Sanwa Bank, as secured party, prohibiting Borrower from creating or
      assuming any Lien on the cash pledged as collateral under such security
      agreement to support outstanding letters of credit issued by Sanwa Bank to
      Borrower, and (iv) those licenses, contracts and agreements to which
      Borrower is a party excluded from the Collateral pursuant to the terms of
      Security Agreement, enter into any agreement prohibiting the creation or
      assumption of any Lien upon any of its properties or assets, whether now
      owned or hereafter acquired."

      SECTION 2. WAIVER AND CONSENT

            (A)   Subject to the terms and conditions set forth herein and in
reliance on the representations and warranties of Company herein contained,
Lenders hereby waive compliance with the provisions of (i) subsection 7.04(a) of
the Credit Agreement to the extent, and only to the extent, necessary to permit
Company to forgive the outstanding principal amount of the RSI Note issued by
RSI in favor of Company for less than fair market value (contrary to the
requirements set forth in the definition of "Ordinary Course Dispositions"),
(ii) subsection 1.01 of the Credit Agreement with respect to the definition of
"Permitted Acquisition" to the extent, and only to the extent, necessary to
acknowledge and approve the Upshot Acquisition as a Permitted Acquisition even
though the requirements of clause (d) of the definition of "Permitted
Acquisition" are not satisfied, and (iii) subsection 7.15 of the Credit
Agreement, to the extent, and only to the extent, that such subsection relates
to obtaining the prior written consent of Required Lenders in connection with
the execution and substitution of the RSI Supply Agreement insofar as it is a
"Related Document" and the extinguishment of the RSI Note, which consent shall
be deemed to have been given hereby.

            (B)   Without limiting the generality of the provisions of
subsection 10.01 of the Credit Agreement, the waiver and consent set forth above
shall be limited precisely as written and relates solely to the extent Company
would otherwise be in noncompliance with the provisions of subsections 7.04(a),
7.05(d) and 7.15 of the Credit Agreement in the manner and to the extent
described above, and nothing in this Agreement shall be deemed to:

                  (i)   constitute a waiver of compliance by Company with
            respect to (i) subsections 7.04(a), 7.05(d) and 7.15 of the Credit
            Agreement in any other instance or (ii) any other term, provision or
            condition of the Credit Agreement or any other instrument or
            agreement referred to therein (whether in connection with this
            Agreement or otherwise); or

                  (ii)  prejudice any right or remedy that Administrative Agent
            or any Lender may now have (except to the extent such right or
            remedy was based upon existing defaults that will not exist after
            giving effect to this Agreement) or may have in the future under or
            in connection with the Credit Agreement or any other instrument or
            agreement referred to therein.

            (C)   Except as expressly set forth herein, the terms, provisions
and conditions of the Credit Agreement and the other Loan Documents shall remain
in full force and effect and in all other respects are hereby ratified and
confirmed.

      SECTION 3. COMPANY'S REPRESENTATIONS AND WARRANTIES

            In order to induce Lenders to enter into this Agreement and thereby
amend the Credit Agreement in the manner provided herein, Company represents and
warrants to each Lender that the following statements are true, correct and
complete:

            3.1   CORPORATE POWER AND AUTHORITY. Company has all requisite
corporate power and authority to enter into this Agreement and to carry out the
transactions contemplated by, and perform its obligations under, the Credit
Agreement as amended by this Agreement (as so amended, the "AMENDED AGREEMENT").

            3.2   AUTHORIZATION OF AGREEMENTS. The execution and delivery of
this Agreement and the performance of the Amended Agreement have been duly
authorized by all necessary corporate action on the part of Company.

            3.3   BINDING OBLIGATION. This Agreement and the Amended Agreement
are, together, the legal, valid and binding obligation of Company, enforceable
against it in accordance with their terms, except as enforcement may be limited
by bankruptcy, insolvency, reorganization, moratorium or similar laws relating
to or limiting creditors' rights generally or by equitable principles, and any
instrument or agreement required hereunder or by the Amended Agreement, in each
case, when executed and delivered, will be similarly valid, binding and
enforceable.

            3.4   INCORPORATION OF REPRESENTATIONS AND WARRANTIES FROM CREDIT
AGREEMENT. The representations and warranties contained in Section 5 of the
Credit Agreement are true, correct and complete in all material respects, except
to the extent such representations and warranties specifically relate to an
earlier date, in which case they were true, correct and complete in all material
respects on and as of such earlier date.

            3.5   ABSENCE OF DEFAULT. No event has occurred and is continuing or
will result from the consummation of this Agreement that would constitute an
Event of Default or a Default.

      SECTION 4. MISCELLANEOUS

            4.1   REFERENCE TO AND EFFECT ON THE CREDIT AGREEMENT AND THE OTHER
LOAN DOCUMENTS.


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            (A)   On and after the Effective Date, each reference in the Credit
Agreement to "this Agreement", "hereunder", "hereof", "herein" or words of like
import referring to the Credit Agreement, and each reference in the other
documents entered pursuant to the Credit Agreement to the "Credit Agreement",
"thereunder", "thereof" or words of like import referring to the Credit
Agreement shall mean and be a reference to the Amended Agreement.

            (B)   Except as specifically amended by this Agreement, the Credit
Agreement and the other documents entered pursuant to the Credit Agreement shall
remain in full force and effect and are hereby ratified and confirmed.

            (C)   The execution, delivery and performance of this Amendment
shall not, except as expressly provided herein, constitute a waiver of any
provision of, or operate as a waiver of any right, power or remedy of
Administrative Agent or any Lender under the Credit Agreement or any of the
other Loan Documents.

            4.2   HEADINGS. Section and subsection headings in this Agreement
are included herein for convenience of reference only and shall not constitute a
part of this Agreement for any other purpose or be given any substantive effect.

            4.3   CALIFORNIA LAW. This Agreement shall be governed by, and shall
be construed and enforced in accordance with, the internal laws of the State of
California, without regard to conflicts of laws principles.

            4.4   COUNTERPARTS; EFFECTIVENESS. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument; signature pages may be detached from multiple separate
counterparts and attached to a single counterpart so that all signature pages
are physically attached to the same document. This Agreement shall become
effective as of September 30, 2002 (the "EFFECTIVE DATE") upon the execution of
a counterpart hereof by Company and Required Lenders and receipt by Company and
Administrative Agent of written or telephonic notification of such execution and
authorization of delivery thereof.

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

                             COMPANY:

                             EQUITY MARKETING, INC.

                             By: /s/ Michael W. Sanders
                                 -----------------------------
                                 Name: Michael W. Sanders
                                 Title:   Senior Director, Finance


                             BANK OF AMERICA, N.A., as Administrative Agent


                             By: /s/ Ken Puro
                                 -----------------------------
                                 Name: Ken Puro
                                 Title:   Vice President


                             BANK OF AMERICA, N.A., as Lender, Swing Line Lender
                             and Issuing Lender


                             By: /s/ David J. Stassel
                                 -----------------------------
                                 Name: David J. Stassel
                                 Title:   Senior Vice President


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