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                                                                    EXHIBIT 10.4

                          BALDWIN PIANO & ORGAN COMPANY

                 THIRD AMENDMENT AND LIMITED WAIVER AND CONSENT
                                       TO
                                CREDIT AGREEMENT

                  This THIRD AMENDMENT AND LIMITED WAIVER AND CONSENT TO CREDIT
AGREEMENT (this "AMENDMENT") is dated as of January 26, 2001 and entered into by
and among BALDWIN PIANO & ORGAN COMPANY, a Delaware corporation ("BORROWER"),
GENERAL ELECTRIC CAPITAL CORPORATION ("GE CAPITAL"), as agent for itself and
Lenders ("AGENT"), the financial institutions listed on the signature pages
hereof ("LENDERS"), and, for purposes of Section 5 hereof, the Credit Parties
listed on the signature pages hereof, and is made with reference to: (i) that
certain Credit Agreement dated as of March 24, 2000, by and among Borrower, the
other Credit Parties party thereto, Lenders and Agent (as modified by the First
Amendment and Limited Waiver thereto dated as of August 11, 2000, the Limited
Waiver and Consent thereto dated as of September 28, 2000, the Limited Waiver
thereto dated as of October 30, 2000, the Second Amendment and Limited Waiver
thereto dated as of December 15, 2000 (the "SECOND AMENDMENT") and as such
agreement may have otherwise been amended, restated, supplemented or otherwise
modified from time to time prior to the date hereof, the "CREDIT AGREEMENT");
and (ii) that certain Security Agreement dated as of March 24, 2000 (as
heretofore amended, restated, supplemented or otherwise modified from time to
time, the "SECURITY AGREEMENT") by and among Borrower, the Grantors party
thereto and GE Capital, as Agent for itself and Lenders. Capitalized terms used
herein without definition shall have the same meanings herein as set forth in
the Credit Agreement or the Security Agreement, as applicable.

                                 R E C I T A L S
                                 - - - - - - - -

                  WHEREAS, Borrower has informed Agent and Lenders that Borrower
has proposed to enter into an Asset Purchase Agreement (the "CE ASSET PURCHASE
AGREEMENT") with Ayrshire Electronics LLC, a Kentucky limited liability company
("AYRSHIRE"), pursuant to which Borrower has agreed to sell to Ayrshire all of
the assets of Borrower primarily relating to and used by Borrower in the
operation of Borrower's contract electronics manufacturing services division
(the "SUBJECT ASSETS").

                  WHEREAS, in connection with the Closing under the CE Asset
Purchase Agreement, Borrower and Ayrshire have agreed to enter into a
Confidentiality, Nonsolicitation and Noncompetition Agreement (the "CE
NONCOMPETE AGREEMENT"), an Information Technology Transition Services Agreement
and a Lease (together with the CE Asset Purchase Agreement, collectively, the
"CE SALE DOCUMENTS").



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                  WHEREAS, Borrower has requested that Agent and Requisite
Lenders (i) waive the restrictions contained in Sections 5.1, 6.7 and 6.8 of the
Credit Agreement to the extent necessary to permit the sale of the Subject
Assets to Ayrshire for a gross cash purchase price of not less that $9,700,000
(the "CE SALE") and consent to the release of liens created by the Security
Agreement on the Subject Assets pursuant to the terms thereof and (ii) extend
the January 31, 2001 date set forth in Section 2 of the Second Amendment to
February 16, 2001.

                  WHEREAS, Agent and Requisite Lenders have agreed to make
certain amendments and waive certain requirements of the Credit Agreement and
consent to the release of liens created by the Security Agreement on the Subject
Assets, but only on the terms and conditions hereinafter set forth.

                  NOW, THEREFORE, in consideration of the premises and the terms
and conditions herein contained, Borrower, Agent and Requisite Lenders hereby
agree pursuant to Section 11.2 of the Credit Agreement as follows:

                                   SECTION 1.
                       AMENDMENTS TO THE CREDIT AGREEMENT

                  On the basis of the representations and warranties contained
in this Amendment, and subject to the terms and the satisfaction of the
conditions set forth in this Amendment, Agent and Requisite Lenders hereby agree
as follows:

                  A. AMENDMENT TO SECTION 1.6. Section 1.6(s) of the Credit
Agreement is amended and restated as follows:

                  "(s) with respect to any Account owing by Biasco Musical
         Instrument Co., to the extent such Account, together with all other
         Accounts owing by Biasco Musical Instrument Co. and its Affiliates, as
         at any date of determination exceeds twenty percent (20%) of all
         Eligible Accounts; provided that, to the extent that such Accounts
         exceed twenty percent (20%) of all Eligible Accounts, Agent may elect
         to nevertheless treat all or a portion of such excess Accounts as
         Eligible Accounts on such terms, including advance rates and Reserves,
         as the Agent shall determine in its discretion, it being understood
         that, from and after the Third Amendment Effective Date and
         notwithstanding any advance rate percentage set forth in clause (a) of
         the definition of Borrowing Base, until Borrower received a subsequent
         notice from Agent, the advance rate for such excess Accounts shall be
         51.5% of such excess Accounts to the extent such excess Accounts are
         otherwise Eligible Accounts."

                  B. AMENDMENT TO SECTION 3. Section 3 of the Credit Agreement
is hereby amended by inserting a new Section 3.28 at the end thereof as follows:

                  "3.28 CE SALE DOCUMENTS. As of the Third Amendment Effective
         Date, Borrower has delivered to Agent a complete and correct copy of
         the CE Sale Documents (including all schedules, exhibits, amendments,
         supplements, modifications, assignments and all other documents
         delivered pursuant thereto or in



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         connection therewith). No Credit Party and no other Person party
         thereto is in default in the performance or compliance with any
         provisions thereof. Each of the CE Sale Documents complies with, and
         the CE Sale has been consummated in accordance with, all applicable
         laws. Each of the CE Sale Documents is in full force and effect as of
         the Third Amendment Effective Date, has not been terminated, rescinded
         or withdrawn. The Liabilities (as defined in the CE Asset Purchase
         Agreement) arising out of Borrower's relationship with Pana Pacific do
         not exceed $100,000 in the aggregate as of the Third Amendment
         Effective Date. There is no sharing of customers or other relationship
         between any of the businesses being retained by Borrower and the
         contract electronics manufacturing services business of Borrower being
         sold to Ayrshire or other circumstances such that Section 3(a) of the
         CE Noncompete Agreement would be violated. All requisite approvals by
         Governmental Authorities having jurisdiction over Ayrshire, any Credit
         Party and other Persons referenced therein, with respect to the
         transactions contemplated by the CE Sale Documents, have been obtained,
         and no such approvals impose any conditions to the consummation of the
         transactions contemplated by the CE Sale Documents or to the conduct by
         any Credit Party of its business thereafter. To the best of each Credit
         Party's knowledge, none of Ayrshire's representations or warranties in
         the CE Asset Purchase Agreement contain any untrue statement of a
         material fact. Each of the representations and warranties given by each
         applicable Credit Party in the CE Asset Purchase Agreement is true and
         correct in all material respects and do not or omit any fact necessary
         to make the statements therein not misleading. Notwithstanding anything
         contained in the CE Asset Purchase Agreement to the contrary, such
         representations and warranties of the Credit Parties are incorporated
         into this Agreement by this SECTION 3.28 and shall, solely for purposes
         of this Agreement and the benefit of Agent and Lenders, survive the
         consummation of the CE Sale."

                  C. AMENDMENTS TO ANNEX A.

                           (1) Annex A of the Credit Agreement is hereby amended
by amending the definition of "Borrowing Base" contained therein by deleting
from paragraph (b) thereto the words "fifty-six and five-tenths percent (56.5%)"
appearing therein and inserting the words "fifty-one and five-tenths percent
(51.5%)" in their place.

                           (2) Annex A of the Credit Agreement is hereby further
amended by inserting the following definitions therein in alphabetical order:

                  "`AYRSHIRE' means Ayrshire Electronics LLC, a Kentucky limited
         liability company.

                  `CE ASSET PURCHASE AGREEMENT' means that certain Asset
         Purchase Agreement dated as of January 26, 2001 by and between Borrower
         and Ayrshire, as such agreement may be amended, supplemented or
         otherwise modified in accordance with SECTION 6.19.

                  `CE LEASE' means that certain Lease made and entered into as
         of January 26,



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         2001 by and between by Borrower and Ayrshire, as such agreement may be
         amended, supplemented or otherwise modified in accordance with SECTION
         6.19.

                  `CE NONCOMPETE AGREEMENT' means that certain Confidentiality,
         Nonsolicitation and Noncompetition Agreement dated as of January 26,
         2001 by and between Ayrshire and Borrower, as such agreement may be
         amended, supplemented or otherwise modified in accordance with SECTION
         6.19.

                  `CE SALE' means the sale by Borrower to Ayrshire of the assets
         of Borrower primarily relating to and used by Borrower in the operation
         of Borrower's contract electronics manufacturing services division.

                  `CE TRANSITION SERVICES AGREEMENT' means that certain
         Information Technology Transition Services Agreement dated as of
         January 26, 2001 by and between Ayrshire and Borrower, as such
         agreement may be amended, supplemented or otherwise modified in
         accordance with SECTION 6.19.

                  `CE SALE DOCUMENTS" shall mean the CE Asset Purchase
         Agreement, CE Noncompete Agreement, CE Transition Services Agreement
         and CE Lease.

                  `THIRD AMENDMENT' means that certain Third Amendment to the
         Credit Agreement dated as of January 26, 2001 by and among Borrower,
         the Lenders signatory thereto, Agent and other Credit Parties signatory
         thereto.

                  `THIRD AMENDMENT EFFECTIVE DATE' means the Third Amendment
         Effective Date as defined in the Third Amendment."

         D. AMENDMENT TO DISCLOSURE SCHEDULE (3.19) (DEPOSIT AND DISBURSEMENT
ACCOUNTS). Disclosure Schedule (3.19) is hereby amended by adding the following
line entry under "LOCKBOX ACCOUNTS":

                  "Baldwin Piano & Organ Company
                  FIFTH THIRD BANK
                  P.O. Box 632383 Cincinnati, Ohio 45263
                  Baldwin Piano & Organ Company
                  5/3 BANK - LOCKBOX"

         E. AMENDMENT TO DISCLOSURE SCHEDULE A. Disclosure Schedule A of the
Credit Agreement is hereby amended by inserting the following at the end
thereof:

                  "10.     CE Asset Purchase Agreement

                  11.      CE Noncompete Agreement

                  12.      CE Transition Services Agreement

                  13.      CE Lease."


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                                   SECTION 2.
               LIMITED WAIVER AND CONSENT TO THE CREDIT AGREEMENT

                  A. CE SALE. On the basis of the representations and warranties
contained in this Amendment, and subject to the terms and conditions of this
Amendment, Agent and Requisite Lenders hereby agree to waive the restrictions
contained in Sections 5.1, 6.7 and 6.8 of the Credit Agreement solely to the
extent necessary to permit Borrower and Ayrshire to consummate the CE Sale
pursuant to the terms of the CE Sale Documents; PROVIDED that concurrently with
the consummation of the CE Sale, Borrower shall deposit proceeds received in
connection with the CE Sale to the Collection Account. Requisite Lenders hereby
authorize Agent to, at Borrower's sole cost and expense, execute and deliver
such partial releases of its security interest in and Liens on such Collateral
which constitutes Subject Assets as may be reasonably requested by Borrower in
connection with the CE Sale, including, without limitation, any UCC-3
termination statements and other full or partial release instruments, as
applicable. Notwithstanding anything contained herein to the contract, this
Amendment shall cease to be of any force or effect if the CE Sale has not been
consummated on or before January 31, 2001.

                  B. EXTENSION. On the basis of the representations and
warranties contained in this Amendment, and subject to the terms and conditions
of this Limited Waiver, Agent and Requisite Lenders agree to extend the January
31, 2001 date set forth in Section 2 of the Second Amendment to February 16,
2001.


                                   SECTION 3.
                              LIMITATION OF WAIVER

                  Without limiting the generality of the provisions of Section
11.2 of the Credit Agreement, the wavier set forth above shall be limited
precisely as written and relates solely to noncompliance by Borrower with the
provisions of Sections 5.1, 6.7 and 6.8 of the Credit Agreement in the manner
and to the extent described above and nothing in this Amendment shall be deemed
to:

                  (a) constitute a waiver of compliance by Borrower with respect
to (i) the Sections 5.1, 6.7 and 6.8 of Credit Agreement in any other instance
or (ii) any other term, provision or condition of the Credit Agreement, Security
Agreement or any other instrument or agreement referred to therein; or

                  (b) prejudice any right or remedy that 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 Amendment) or may have
in the future under or in connection with the Credit Agreement, Security
Agreement or any other instrument or agreement referred to therein.

                  Except as expressly set forth herein, the terms, provisions
and conditions of the Credit Agreement, Security Agreement and the other Loan
Documents shall remain in full



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force and effect and in all other respects are hereby ratified and confirmed.

                                   SECTION 4.
                         REPRESENTATIONS AND WARRANTIES

                  In order to induce Agent and Lenders to enter into this
Amendment, Borrower hereby represents and warrants to Agent and Lenders that:

                  A. AUTHORIZATION; BINDING OBLIGATIONS. Each Credit Party has
all requisite corporate power and authority to enter into this Amendment. The
execution, delivery and performance of this Amendment have been duly authorized
by all necessary corporate action by each Credit Party. This Amendment has been
duly executed and delivered by each Credit Party and is the legal, valid and
binding obligation of each Credit Party, enforceable against each Credit Party
in accordance with its terms, except to the extent that the enforceability
thereof may be limited by applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or similar laws generally affecting
creditors' rights and by equitable principles (regardless of whether enforcement
is sought in equity or at law). As of the Third Amendment Effective Date (as
hereinafter defined), the Credit Agreement, as amended by this Amendment, will
constitute the legal, valid and binding obligation of each Credit Party,
enforceable against each Credit Party in accordance with its terms, except to
the extent that the enforceability thereof may be limited by applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or
similar laws generally affecting creditors' rights and by equitable principles
(regardless of whether enforcement is sought in equity or at law).

                  B. INCORPORATION OF REPRESENTATIONS. Each representation and
warranty of each Credit Party contained in each of the Loan Documents is true,
correct and complete in all material respects on and as of the Third Amendment
Effective Date to the same extent as though made on and as of the Third
Amendment Effective, except to the extent such representations and warranties
relate to an earlier date, in which case they were true, correct and complete in
all material respects as of such earlier date.

                  C. ABSENCE OF DEFAULTS. No event has occurred and is
continuing or would result from the execution, delivery or performance of this
Amendment that constitutes or would constitute a Default or Event of Default
after giving effect to this Amendment.

                  D. PERFORMANCE. Borrower has performed in all material
respects all agreements to be performed on its part on or before the date hereof
as set forth in the Credit Agreement.

                                   SECTION 5.
                  ACKNOWLEDGEMENT AND CONSENT BY CREDIT PARTIES

                  Borrower and each other Credit Party executing a counterpart
hereto agree to and acknowledge the terms and provisions of this Amendment and
confirm that each Loan Document to which such Credit Party is a party shall
continue in full force and effect and that



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all of its obligations thereunder shall be valid and enforceable and shall not
be impaired or affected by the execution of this Amendment, except as
specifically provided herein. Borrower and each other Credit Party executing a
counterpart hereof represent and warrant that, all representations and
warranties contained in each Loan Document to which such Credit Party is a party
are true, correct and complete in all material respects as of the date hereof to
the same extent as though made on each such date and that Borrower and each such
Credit Party has performed in all material respects all agreements to be
performed on its part on or before the date hereof as set forth in the Loan
Documents.

                                   SECTION 6.
                           CONDITIONS TO EFFECTIVENESS

         This Amendment shall become effective (the "THIRD AMENDMENT EFFECTIVE
DATE") only upon receipt of the following items by Agent:

         (a) counterparts hereof duly executed by each Credit Party and
Requisite Lenders (or, in the case of any Lender, telex or telephone
confirmation from such Lender of its execution hereof);

         (b) the form and substance of the CE Sale Documents, which form and
substance shall in all respects be satisfactory to Agent and Requisite Lenders
(which satisfaction shall be evidenced by such Lenders executing a counterpart
hereof);

         (c) the final form of the CE Sale Documents which shall be in the form
approved by Agent and Requisite Lenders with such changes thereto as may be
acceptable to Agent;

         (d) resolutions of the Borrower's Board of Directors and stockholders,
approving and authorizing the execution, delivery and performance of the CE Sale
Documents and the Third Amendment, certified as of the Third Amendment Effective
Date by Borrower's corporate secretary or an assistant secretary as being in
full force and effect without any modification or amendment; and

         (e) evidence satisfactory to Agent that Borrower has sent or in any
event within five (5) Business Days after the Closing Date under the CE Asset
Purchase Agreement will send written notices to all Account Debtors of the music
division which have previously been instructed to direct payments to Lock Box
Number 631882 maintained at Fifth Third instructing such Account Debtors
thereafter to send such payments to Lock Box Number 632383 maintained at Fifth
Third; and

         (f) such other documents as Agent may reasonably request.


                                   SECTION 7.
                                  MISCELLANEOUS

         A. EFFECT OF AMENDMENT. Except as specifically provided herein, this


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Amendment does not in any way waive, amend, modify, affect or impair the terms
and conditions of the Credit Agreement or the other Loan Documents, and all
terms and conditions of the Credit Agreement and the other Loan Documents are
hereby ratified and confirmed and shall remain in full force and effect unless
otherwise specifically amended, waived, modified or changed pursuant to the
terms and conditions of this Amendment.

                  On and after the Third Amendment 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 Loan Documents to the "Credit Agreement", "thereunder",
"thereof", or words of like import referring to the Credit Agreement shall mean
and be a reference to the Credit Agreement as modified by this Amendment.

         B. FEES AND EXPENSES. Borrower acknowledges that all costs, fees and
expenses as described in Section 11.3 of the Credit Agreement incurred by Agent,
Lenders and their respective counsel with respect to this Amendment and the
documents and transactions contemplated hereby shall be for the account of
Borrower.

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

         D. APPLICABLE LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO CONTRACTS MADE AND PERFORMED IN THAT STATE AND ANY APPLICABLE LAWS
OF THE UNITED STATES OF AMERICA.

         E. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, including by telecopy, 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.




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


                          BORROWER:

                          BALDWIN PIANO & ORGAN COMPANY

                          By: /s/ DUANE D. KIMBLE, JR.
                              ------------------------
                              Name:  Duane D. Kimble, Jr.
                                     --------------------
                              Title: Executive Vice President
                                     ------------------------


                          AGENT AND LENDERS:

                          GENERAL ELECTRIC CAPITAL CORPORATION, AS AGENT FOR
                          ITSELF AND LENDERS

                          By: /s/ CHARLES CHIODO
                              ------------------
                              Name: Charles Chiodo
                                    --------------
                              Title: Its Duly Authorized Signatory


                          OTHER CREDIT PARTIES:

                          THE WURLITZER COMPANY

                          By: /s/ DUANE D. KIMBLE, JR.
                              ------------------------
                              Name:  Duane D. Kimble, Jr.
                                     --------------------
                              Title: Executive Vice President
                                     ------------------------


                             BALDWIN TRADING COMPANY


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                                      By: /s/ DUANE D. KIMBLE, JR.
                                          ------------------------
                                          Name:  Duane D. Kimble, Jr.
                                                 --------------------
                                          Title: Executive Vice President
                                                 ------------------------




                                      THE BALDWIN PIANO COMPANY (CANADA) LIMITED

                                      By: /s/ DUANE D. KIMBLE, JR.
                                          ------------------------
                                          Name:  Duane D. Kimble, Jr.
                                                 --------------------
                                          Title: Executive Vice President
                                                 ------------------------