Recoton Corporation
2950 Lake Emma Road
Lake Mary, Florida 32746

January 16, 2001

I. Friedman Equities, Inc.
99 Park Avenue, Suite 2230
New York, NY 10016
Ladies and Gentlemen:

This
will confirm the understanding and agreement between Recoton Corporation (the
Company or Recoton) and I. Friedman Equities, Inc.
(Equities) in connection with Equities continuing to render its
services as financial advisor to the Company.

1.
Recoton hereby continues the engagement of Equities as its financial advisor for
the one-year period commencing January 1, 2001 and ending December 31, 2001,
which term shall be annually renewed unless either party provides the other with
a written notice of non-renewal at least 90 days prior to the scheduled
expiration date. Equities shall upon the Companys request review with
members of senior management the Companys financial plans, strategic plans
and business alternatives; advise the Company with respect to financing
alternatives involving equity, debt of Company and/or subsidiaries, and
combinations or variations thereof; advise the Company with respect to strategic
acquisitions, combinations, joint ventures, and/or mergers; and advise the
Company with respect to opportunities for the sale of the Companys assets,
subsidiaries, divisions, and such other related services as reasonably requested
by Company. Equities shall exercise its best efforts on behalf of the Company
and shall devote such time as is reasonably necessary to perform these services
for the Company consistent with its commitments and obligations to other
business for whom it renders similar services.

2.
As compensation for Equities' services hereunder:

(a)
The Company shall pay to Equities consulting fees of $55,000 per year, payable
quarterly on January 1, April 1, July 1 and October 1 of each year.

(b)
The Company shall, pursuant to approval by the Board of Directors, issue to
Equities options to purchase 20,000 Recoton common shares pursuant to the
Company's 1998 Stock Option Plan (the "Options"), pursuant to a form of option
certificate substantially in the form of Exhibit A. The Options shall be
exercisable at $10.16 per share for a ten-year period from the date of grant,
subject to the terms of the 1998 Stock Option Plan, except that (pursuant to the
approval of the Compensation and Stock Option Committee) the ten year term of
the options shall not expire in the event that Equities and/or Irwin Friedman
should ever cease to be a consultant to the Company.

3.
If Equities initiates a transaction or transactions, including acquisitions,
mergers, divestitures, financings or public offerings, the Company will pay a
success fee to be mutually agreed upon.

4.
The Company shall reimburse Equities upon request from time to time for all
reasonable and necessary out-of-pocket expenses provided that (i) such expenses
are deductible by the Company and (ii) such expenses are properly documented and
accounted for in accordance with the policy of the Company and with the
requirements of the Internal Revenue Service. Any expenses in excess of $3,000
in any month shall not be reimbursed unless such expenses were approved by an
authorized officer of the Company.

5.
Irwin Friedman, President and sole shareholder of Equities, has served and
continues to serve as a Director of the Company and has and may serve on
committees of the Board. Such services and the compensation to Friedman for such
services shall be in addition to the services and compensation payable to
Equities pursuant to this Agreement.

6.
Equities shall hold all information regarding the Company in confidence and use
any information which it learns solely in the performance of its services
hereunder in accordance with the confidentiality policy attached as Exhibit B.
The provisions of this paragraph 6 and the attached policy shall survive
termination of this Agreement as a separate agreement of the parties.

7.
In performing the services under this Agreement, Equities shall be an
independent contractor and not an employee or agent of the Company. As such, the
employees of Equities shall not be entitled to health insurance coverage, sick
leave, vacation, pension, or other benefits associated with regular employment
at the Company and no income taxes will be withheld from payment to Equities for
services rendered hereunder. In addition, the Companys workers
compensation insurance is not applicable to employees of Equities in the context
of this Agreement.

8.
This Agreement supersedes any prior agreements between the parties regarding the
subject matter of this Agreement, whether such prior agreements were or were not
in writing. No waiver, amendment or other modifications of this Agreement shall
be effective unless in writing and signed by each party to be bound thereby.
This Agreement shall be governed by, and in accordance with, the laws of the
State of New York applicable to agreements executed and to be fully performed
therein. The obligations of this Agreement shall be binding up and shall inure
to the benefit of the parties hereto, the indemnified persons hereunder, and any
of their successors, assigns, heirs, and representatives.

9.
Equities may not assign or transfer any of the rights, or delegate any of the
obligations, under this Agreement other than its rights and obligations under
this Agreement (but not under the option certificate) to Irwin Friedman or an
entity affiliated with Irwin Friedman. The Company may assign its rights,
together with its obligations hereunder, to any parent, subsidiary, affiliate or
successor, or in connection with any sale, transfer or other disposition of all
or substantially all of its business and assets, provided, however, that
any such assignee assumes the Companys obligations hereunder.

10.
Each party shall indemnify and hold the other party harmless from and against
any claims, liability, loss or damages, including reasonable legal fees,
resulting from the breach of any terms, conditions or provisions of this
Agreement by it.

11.
The parties shall submit to binding arbitration in any controversy or claim
arising out of or relating to this Agreement or any breach thereof, provided,
however, that the Company shall not be prohibited, limited or in any other
way restricted from seeking or obtaining equitable relief from a court having
jurisdiction of the parties against violations of paragraph 6 of this Agreement.
Such arbitration shall be conducted in New York City in accordance with the
Rules of the American Arbitration Association in effect at that time, and
judgment upon the determination or award rendered by the arbitrators may be
entered in any court having jurisdiction thereof. The arbitrators are hereby
authorized to award to the winning party the costs (including reasonable
attorneys fees and expenses) of any such arbitration.

12.
If any provision of this Agreement shall be found by any arbitration panel or
court of competent jurisdiction to be invalid or unenforceable, the parties
hereby waive such provision to the extent that it is found to be invalid or
unenforceable. Such provision shall, to the extent allowable by law, be modified
by such panel or court so that it becomes enforceable and, as modified, shall be
enforced as any other provision hereof, all the other provisions continuing in
full force and effect.

Please confirm that the foregoing is in accordance with your understanding of
the terms of our engagement by signing and returning to us the enclosed
duplicate of this letter, which shall thereupon constitute a binding agreement
between us.

| | RECOTON CORPORATION

By:   /s/ Robert L. Borchardt
Name:   Robert L. Borchardt
Title:   President and CEO
| | ---------------------------------------------------------------------------------------------------------

Exhibit A

OPTION CERTIFICATE
NON-QUALIFIED STOCK OPTION
To Purchase 20,000 Common Shares of
RECOTON CORPORATION
Issued Pursuant to the 1998
Stock Option Plan of Recoton Corporation

THIS
CERTIFIES that on January 16, 2001, I. Friedman Equities, Inc. (the "Holder")
was granted an option ("Option"), which is not an incentive stock option, to
purchase at the Option price of $10.16 per share all or any part of 20,000 fully
paid and non-assessable Common Shares, p.v. $.20 (the "Shares") of Recoton
Corporation ("Corporation"), upon and subject to the following terms and
conditions.

This Option shall expire on January 15, 2011.

This
Option shall not be transferable by the Holder otherwise than by will or by the
laws of descent and distribution or as provided pursuant to the 1998 Stock
Option Plan of Recoton Corporation (the "Plan").

Except as
otherwise provided in the Plan, this Option shall be exercisable as follows:
immediately upon grant in full and the ten year term of the options shall not
expire in the event that Equities and/or Irwin Friedman should ever cease to be
a consultant to the Company. In no event, however, may this Option be exercised
after the Option's expiration date.

The
Option and this Option certificate are issued pursuant to and are subject to all
of the terms and conditions of the Plan, the terms and conditions of which are
hereby incorporated by reference and a copy of which is attached to this
certificate. A determination of the Committee or the Board of Directors under
the Plan as to any questions which may arise with respect to the interpretation
of the provisions of the Option and of the Plan shall be final. The Committee or
the Board of Directors may authorize and establish such rules, regulations and
revisions thereof not inconsistent with the provisions of the Plan, as it may
deem advisable.

WITNESS the signature of the Corporation's duly authorized officer.

| | RECOTON CORPORATION

By:   /s/ Joseph H. Massot
Name:   Joseph H. Massot
Title:     Senior V.P. and Secretary
| | -------------------------------------------------------------------------------------------------------------