September 30, 2008

Exhibit (d.1)

September 30, 2008

Harbinger Capital Partners Master Fund I, Ltd.

Harbinger Capital Partners Special Situations Fund, L.P.

000 Xxxxxxx Xxxxxx, 00xx Xxxxx

Xxx Xxxx, Xxx Xxxx 00000

Attention: Xx. Xxxxx Xxxxx

Re: Merger of Grill Acquisition Corporation with and into Salton, Inc. pursuant to Delaware General Corporation Laws § 253

Ladies and Gentlemen:

Reference is made to that certain Third Amended and Restated Credit Agreement dated as of December 28, 2007 (as at any time amended, restated, supplemented or otherwise modified, the “Credit Agreement”), among Salton, Inc., a Delaware corporation (“Parent”), APN Holding Company, Inc., a Delaware corporation, Applica Consumer Products, Inc., a Florida corporation (successor-by-merger to each of Sonex International Corporation, Icebox, LLC, Family Products Inc., and One:One Coffee LLC), Applica Americas, Inc., a Delaware corporation, HP Delaware, Inc., a Delaware corporation, HPG, LLC, a Delaware limited liability company, Applica Mexico Holdings, Inc., a Delaware corporation, Home Creations Direct Ltd., a Delaware corporation, Salton Holdings, Inc., a Delaware corporation, and Toastmaster Inc., a Missouri corporation (successor-by-merger to Salton Toastmaster Logistics LLC) (collectively, “Borrowers”); Applica Asia Limited, a Hong Kong company, and Applica Canada Corporation, a Nova Scotia company (together, “Guarantors,” and together with Borrowers, “Loan Parties”); Bank of America, N.A., a national banking association, as collateral and administrative agent (together with its successors in such capacity, “Agent”) for various financial institutions (“Lenders”); and Lenders. All terms used herein, unless otherwise defined, shall have the meaning ascribed to them in the Credit Agreement.

Equity Investors have advised Agent and Lenders that Equity Investors desire to engage in the following transactions pursuant to which Parent will cease to be a publicly-traded company and will become wholly-owned by Equity Investors (such transactions collectively referred to as the “Short Form Merger Transaction”): (a) Equity Investors will establish Grill Acquisition Corporation, a Delaware corporation (“Newco”), and contribute their shares in Parent to Newco; (b) Newco will issue shares to each Equity Investor in proportion to such Equity Investor’s ownership interest in Parent prior to the contribution of such shares to Newco; (c) Newco will merge into and with Parent, with Parent being the surviving entity, effected in accordance with Section 253 of the Delaware General Corporation Law; and (d) the shares of common stock of Parent owned by Persons other than Newco will be cancelled on the date of the Short Form Merger Transaction and such Persons will be compensated for such shares with funds from Equity Investors (and not Revolving Loans) and cease to be holders of equity interests in Parent. Equity Investors have requested that Agent and Required Lenders consent to the Short Form Merger Transaction which, absent such consent, would constitute an Event of Default under the Credit Agreement.

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By their signatures below, Agent and Required Lenders consent to the Short Form Merger Transaction and agree to execute and deliver to Loan Parties, upon the effective date of the Short Form Merger Transaction, a letter agreement regarding the Short Form Merger Transaction in the form attached hereto as Exhibit A. By their signatures hereinbelow, Equity Investors agree to cause the Loan Parties to execute and deliver to Agent and Required Lenders a letter agreement regarding the Short Form Merger Transaction in the form attached hereto as Exhibit A.

Very truly yours,
AGENT:
BANK OF AMERICA, N.A., as Agent
By:		/s/ Xxxxxx X. Xxxxxx
Name:		Xxxxxx X. Xxxxxx
Title:		Senior Vice-President
LENDERS:
BANK OF AMERICA, N.A.
By:		/s/ Xxxxxx X. Xxxxxx
Name:		Xxxxxx X. Xxxxxx
Title:		Senior Vice-President
TEXTRON FINANCIAL CORPORATION
By:		/s/ Xxxxx Xxxxxxxx
Name:		Xxxxx Xxxxxxxx
Title:		Senior Account Executive
XXXXX FARGO FOOTHILL, LLC
By:		/s/ Xxxxx X. Xxxx
Name:		Xxxxx X. Xxxx
Title:		Vice-President

[Signatures continued on following page]

Acknowledged and Agreed:
HARBINGER CAPITAL PARTNERS MASTER FUND I, LTD.
By:		Harbinger Capital Partners Offshore Manager, L.L.C., its Investment Manager
		By:		/s/ Xxxxxxx X. Xxxxxx
		Name:		Xxxxxxx X. Xxxxxx
		Title:		Executive Vice-President
HARBINGER CAPITAL PARTNERS SPECIAL SITUATIONS FUND, L.P.
By:		Harbinger Capital Partners Special Situations GP, LLC, its General Partner
		By:		/s/ Xxxxxxx X. Xxxxxx
		Name:		Xxxxxxx X. Xxxxxx
		Title:		Executive Vice-President