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                      PLATINUM ENTERTAINMENT, INC.

                            TERM CREDIT NOTE

$20,000,000                                                  December 12, 1997

     For value received, the undersigned, Platinum Entertainment, Inc., a 
Delaware corporation (the "COMPANY") and Intersound, Inc., a Delaware 
corporation ("INTERSOUND"; the Company and Intersound being hereinafter 
referred to collectively as the "BORROWERS"), hereby jointly and severally 
promise to pay to the order of Bank of Montreal (the "LENDER"), at the 
principal office of Bank of Montreal in Chicago, Illinois the principal sum 
of Twenty Million Dollars ($20,000,000), in installments as follows:  eleven 
(11) consecutive quarterly installments (commencing on June 1, 1998 and 
continuing on the first day of each September, December, March and June 
occurring thereafter to and including December 1, 2000) with all such 
installments (except the last such installment) to be in an amount equal to 
$1,818,181.82 per installment and the last such installment to be in an 
amount equal to $1,818,181.80 which shall be the full amount of the then 
unpaid principal balance of this Note.

     This Note evidences indebtedness constituting the "DOMESTIC RATE 
PORTION" and "LIBOR PORTIONS" as such terms are defined in that certain 
Credit Agreement dated as of December 12, 1997, by and among the Borrowers, 
certain Subsidiaries of the Company, Bank of Montreal individually and as 
Administrative Agent and certain lenders which are or may from time to time 
become parties thereto (the "CREDIT AGREEMENT") made or to be made to the 
Borrowers by the Lender under the Term Credit provided for under the Credit 
Agreement and the Borrowers hereby jointly and severally promise to pay 
interest at the office specified above on the loan evidenced hereby at the 
rates and times specified therefor in the Credit Agreement.  Capitalized 
terms used herein without definition shall have the meanings ascribed to them 
in the Credit Agreement, and this Note is subject to the terms of the Credit 
Agreement.

     Any repayment of principal hereon, the status of indebtedness evidenced 
hereby from time to time as part of the Domestic Rate Portion or a LIBOR 
Portion and the interest rates and interest periods applicable thereto shall 
be endorsed by the holder hereof on the reverse side of this Note or recorded 
on the books and records of the holder hereof (provided that such entries 
shall be endorsed on the reverse side hereof prior to any negotiation hereof) 
and the Borrowers agree that in any action or proceeding instituted to 
collect or enforce collection of this Note, the entries so endorsed on the 
reverse side hereof or recorded on the books and records of the Lender shall 
be PRIMA FACIE evidence of the unpaid balance of this Note and the status of 
indebtedness evidenced hereby from time to time as part of the Domestic Rate 
Portion or a LIBOR Portion and the interest rates and interest periods 
applicable thereto.

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     This Note is issued by the Borrowers under the terms and provisions of 
the Credit Agreement and is secured, inter alia, by certain security 
agreements and other instruments and documents from the Company and certain 
of its Subsidiaries, and this Note and the holder hereof are entitled to all 
of the benefits and security provided for thereby or referred to therein, 
equally and ratably with all other indebtedness thereby secured, to which 
reference is hereby made for a statement thereof.  This Note may be declared 
to be, or be and become, due prior to its expressed maturity upon the 
occurrence of an Event of Default specified in the Credit Agreement, 
voluntary prepayments may be made hereon, and certain prepayments are 
required to be made hereon, all in the events, on the terms and with the 
effects provided in the Credit Agreement.

     THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE 
INTERNAL LAWS OF THE STATE OF ILLINOIS WITHOUT REGARD TO PRINCIPLES OF 
CONFLICT OF LAW.

     The Borrowers hereby waive presentment for payment.


                                    PLATINUM ENTERTAINMENT, INC.

                                    By /s/ Steven Devick
                                      ----------------------------------------
                                      Name:  Steven Devick
                                      Title: President




                                    INTERSOUND, INC.

                                    By /s/ Steven Devick
                                      ----------------------------------------
                                      Name:  Steven Devick
                                      Title: President

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