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                                                                   EXHIBIT 10.16

November 5, 1996

Perry Schwartz
220 Walker Lane
Edgewood, KY 41017

Dear Perry:

This letter is to formally outline our offer of employment as Executive Vice
President and Chief Financial Officer, for Baldwin Piano and Organ Company,
based at our Corporate Offices in Loveland, Ohio.

The following is more specific information about the offer. Of course, all of
these items are subject to the details of the specific plan documents. If you
have any questions or want more detailed information, please feel free to
contact Cindy Moeller at 576-4652.

ANNUAL AND LONG-TERM COMPENSATION

Base Salary                         Your starting annual base salary will be  
                                    $180,000 (less withholdings and deductions),
                                    which will be paid monthly on the 25th of
                                    the month. The Company will review your
                                    salary annually.

Annual Incentive                    You will participate in Baldwin's
                                    Management Incentive Plan, which provides
                                    opportunity for an annual cash bonus. You
                                    will be eligible for an annual incentive of
                                    24%, 30%, or 45% of your salary, subject to
                                    the level of the performance of the
                                    Company. The plan runs on a fiscal year
                                    basis, and your participation will begin in
                                    1997.

Annual Incentive Stock Options      In 1997 you will be eligible for an annual
                                    incentive stock option grant, determined by
                                    the CEO, based on your individual
                                    contribution.

Special Stock Option Grant          On your first day of employment the Company
                                    will grant you a qualified option to
                                    acquire 10,000 shares of the Company's
                                    common stock.  The per share exercise price
                                    will equal the closing share price of the
                                    Company's common stock on the NASDAQ Market
                                    on your commencement date. Your right to
                                    exercise 20% of these options will vest
                                    immediately on your commencement date, and
                                    an additional 20% of the options will vest
                                    on each anniversary of your commencement
                                    date. These options will expire on the
                                    earlier of the following: ten years from
                                    the date of the grant or three months
                                    following the termination of your
                                    employment.

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Long-Term Incentive Plan            You will be eligible to participate in
                                    Baldwin's Long-Term Incentive Plan, which
                                    covers a three-year period and which pays
                                    out at the end of the third year. The
                                    current Long-Term Incentive Plan covers
                                    1994-1996. Under this plan awards are based
                                    on Company performance over the three-year
                                    period. At your level you would be eligible
                                    for an award of 0%, 40%, 60%, or 80% of
                                    your third-year base salary. The awards may
                                    be paid in restricted stock, cash, or a
                                    combination. You will be eligible for an
                                    award under this plan, pro-rated for your
                                    length of employment during the period
                                    covered by the plan. A new Long-Term
                                    Incentive Plan will be adopted for
                                    1997-1999. We are currently investigating
                                    alternatives to this long-term incentive
                                    plan.


BENEFITS

Medical and Dental Benefits         You will be eligible to participate in the
                                    medical and dental plan ninety days after
                                    your commencement date. The current medical
                                    plan is a point-of-service plan, and you
                                    will select a primary care physician, who
                                    will direct your medical care. Your share
                                    of the monthly premium for 1996 would be 
                                    $120.00 for family coverage or $45.00 for
                                    single coverage. The maximum annual dental
                                    benefit is $1,000 for each family member.

                                    Co-pay for doctors' visits in the network
                                    is $12. There is a prescription card with a
                                    co-pay of $7 for generic drugs and $12 for
                                    branded drugs. Also there is a mail order
                                    prescription provision with a $7 co-pay for
                                    a three-month supply of maintenance drugs.

Flexible Spending Plan              You will be eligible for the Flexible
                                    Spending Plan, which allows you to make a
                                    salary deferral to pay certain items with
                                    pre-tax dollars. You may defer up to $2,000
                                    annually to the Medical Reimbursement
                                    Account and up to $5,000 to the Dependent
                                    Care Reimbursement Account.

Retirement Plan                     Baldwin has a 401(k) plan, which has two
                                    parts. First, after you have been employed
                                    for 30 days, you will be eligible to make
                                    salary deferral contributions to the Plan
                                    (up to a certain limit). Second, after you
                                    have been employed for one year, the
                                    Company will contribute on an annual basis
                                    to your account an amount equal to 3% of
                                    your salary, plus match your salary
                                    deferral contributions at the rate of 50%
                                    (up to a certain overall limit).

                                    In addition, Baldwin has a Non-Qualified
                                    Deferred Compensation Plan, to which you
                                    also will be able to make salary deferral
                                    contributions (up to a certain limit) after
                                    30 days of employment. After one year of
                                    employment, your deferrals to this Plan
                                    will be matched at the rate of 50% (again,
                                    up to a certain overall limit).

                                    You will choose from the options available
                                    in each plan how to direct the investment
                                    of these funds.

                                    You will be 100% vested in all Company
                                    contributions after five years.

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Vacation                            You will be entitled to four weeks of paid
                                    vacation annually beginning in 1997. You
                                    will receive pro rata vacation for 1996.

Long-Term Disability                You will be offered long-term disability at
                                    group rates.

Life Insurance                      The Company provides life insurance in an
                                    amount equal to 1-1/2 times your annual W-2
                                    earnings. This amount is adjusted annually.

Educational Assistance              You will be eligible for educational
                                    assistance after one year of employment.

OTHER

Change of Control Agreement         Attached to this letter is the Change of
                                    Control Agreement that had been approved by
                                    the Board of Directors for a few select,
                                    critical senior executives. This Change of
                                    Control Agreement will supersede this
                                    compensation package in the event of change
                                    of control. This will give you assurance of
                                    financial protection for a period of time
                                    if Baldwin has a change of control and your
                                    employment is terminated either directly or
                                    constructively as a result.

Separation Agreement                If your employment is terminated
                                    involuntarily by Baldwin within the first
                                    twelve months of your employment and not
                                    for cause, you will be entitled to
                                    severance of $15,000 per month (less
                                    withholdings and deductions) for 6 months
                                    from the termination date. If on that date
                                    you are not employed elsewhere and have
                                    made good faith attempts to seek
                                    employment, you will be entitled to the
                                    same monthly pay per month until employed
                                    up to an additional three months. In
                                    addition, we will provide reasonable
                                    outplacement services.

Employment at Will                  If employed, your employment with the
                                    Company is at-will.

Drug Screen/Background Check        This offer is contingent upon successful
                                    completion of a pre-employment drug screen
                                    and a background check.

Commencement Date                   To comply with Federal law, we will need
                                    you to provide us with proof of identity
                                    (passport, driver's license, or
                                    military/school identification) and a
                                    document that establishes employment
                                    eligibility (Social Security card, birth
                                    certificate, or employment "green card").

Perry, I am certainly looking forward to having you join us at Baldwin.

Sincerely,


Karen L. Hendricks

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November 11, 1996

Mr. Perry H. Schwartz
220 Walker Lane
Edgewood, KY 41017-2600

Dear Perry:

This letter is in response to your letter of November 7, 1998, accepting
employment as Executive Vice President and Chief Financial Officer of Baldwin
Piano & Organ Company, with the following modifications and supplemental
points:

1.   The provisions set forth in Section V of the Change of Control Agreement
     submitted to you will become a part of your employment arrangement from
     the outset, including as an inducement of your acceptance, Baldwin's
     Indemnification Agreement attached, whether or not the Change of Control
     Agreement ever becomes operative.

2.   Your job responsibilities are outlined in Schedule A attached, subject to
     the reasonable assignment by the President and CEO of additional or
     different duties, so long as the nature of same shall be consistent with
     and appropriate to an executive position of no lesser level than that of
     other executives reporting directly to Baldwin's President and CEO.

3.   You shall be afforded resources and authorities which are approved by
     Baldwin's President and CEO and which are reasonably sufficient to
     successfully perform your assigned duties, including reasonably suitable
     office space in Baldwin's Loveland, Ohio headquarters facility and
     secretarial assistance.

4.   The provisions regarding "separation" shall be restated as follows: "If
     your employment is terminated by Baldwin within the first twenty-four (24)
     months of your employment without Cause, as "Cause" is defined below, you
     will be entitled to severance of $15 thousand per month from the
     termination date, for 12 months. Under all circumstances of termination by
     Baldwin, except for Cause, we will provide reasonable outplacement
     services and the opportunity under law to elect COBRA benefits.

     For this purpose, "terminated" shall be deemed to include "constructive
     termination" as defined in Section IV, 1 of the Change of Control
     Agreement, and "Cause" shall be defined as: (i) willful failure to perform
     the duties of the job; (ii) gross neglect in carrying out the duties of
     the job; (iii) willful misconduct which is demonstrable and materially
     injurious to Baldwin; (iv) conviction of a felony after one promptly filed
     unsuccessful appeal; or (v) a material breach by you of any of the terms
     of the employment arrangement between Baldwin and you."

Sincerely,                              ACCEPTED AND AGREED


Karen L. Hendricks                      _______________________________________
                                        Perry H. Schwartz           Date

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                        SCHEDULE A (AS REVISED 11/8/96)
                        CFO RESPONSIBILITIES/AUTHORITIES
                            BALDWIN PIANO AND ORGAN

Organizational:

-   Corporate Secretary
-   Controller
-   Treasury
-   Financial Analyses
-   Information Systems
-   Risk Management


Functional:

-   Analyses
-   Business Planning
-   Create/Implement Financial Controls
-   Information Systems
-   Taxes
-   Shareholder Relations - via active support to CEO's Program
-   Organizational/Cultural Change Essential to Strategic Growth/Profitability
    - via active support to CEO and HR Director
-   Protection of Assets

Tasks (Performance Criteria for CFO):

-   Lead the financial contribution to formal strategic planning and to the
    analysis and rationalization of organizational change and manufacturing
    operations.

-   Develop Company financial policies which enhance/establish systems of
    Internal control as well as accounting policies and procedures to properly
    record the Company's business transactions and to provide the Company's
    asset accountability.

-   Lead the Company's efforts in managing its banking relationships to
    evaluate debt financing and lines of credit and secure alternate sources if
    best for the Company.

-   Provide and analyze financial information that will facilitate effective
    evaluation of and decision-making about growth opportunities, including
    joint ventures, acquisitions, and make-or-buy decisions.

-   Actively support the CEO's efforts to develop and maintain effective
    Investor relations.

-   Analyze financial results to determine the business performance in
    comparison to the current operating plan and highlight opportunities to
    take action.

-   Lead, analyze, and make comprehensive recommendations that will optimize
    the manufacturing costs systems and related information systems.

-   Ensure that the Companies contracts for appropriate and high-quality
    auditing services for the purpose of SEC/public accounting and manage the
    relationship with that firm.

-   Coordinate data processing activities for the Company to ensure that
    up-to-date, relevant, statistical data concerning sales, orders,
    production, Inventories, actual manufacturing costs, accounts receivable,
    and operations results are available on a timely basis.