Document:

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                                                                   Exhibit 10.10

                  MASTER NOTE PURCHASE AND REPURCHASE AGREEMENT

         This Master Note Purchase and Repurchase Agreement (this "Agreement")
is executed as of August 31, 2000 by The Selmer Company, Inc. with an address of
600 Industrial Parkway, Elkhart, IN 46516 ("Selmer") and Textron Financial
Corporation with an address of 701 Xenia Avenue South, Suite 300, Golden Valley,
MN 55416 ("TFC").

                                    RECITALS

        A.        Selmer manufactures and distributes musical instruments
                  ("Selmer Products") and extends credit to selected retail
                  dealers of Selmer Products ("Dealers"), facilitating the
                  acquisition of Selmer Products by such Dealers (the "Floor
                  Plan");

        B.        In order to secure the Floor Plan, among other security,
                  Selmer establishes a first priority security interest in the
                  Selmer Products financed pursuant to the Floor Plan;

        C.        Selmer, from time to time, pursuant to powers of attorney
                  granted to Selmer by Dealers, executes promissory notes on
                  behalf of Dealers evidencing all or a portion of the
                  outstanding indebtedness under the Floor Plan (the "Notes");

        D.        Selmer and TFC intend that TFC will, from time to time, in an
                  amount not to exceed an aggregate of $15 Million at any time
                  outstanding and with full recourse to Selmer, purchase the
                  Notes and take an assignment of all security for, and all
                  other rights of Selmer associated with, such Notes and the
                  indebtedness evidenced thereby; and

        E.        Selmer shall be obligated to repurchase the Notes under the
                  circumstances set forth in this agreement.

                                    AGREEMENT

         In reliance upon the various representations, warranties and covenants
set forth in this Agreement, Selmer and TFC agree as follows:

                          ARTICLE I - PURCHASE OF NOTES

         1.1 PURCHASE OF NOTES. Provided that Selmer is in compliance with, and
is not in breach of, any of its warranties, covenants or other obligations set
forth in this Agreement (and will not be in breach of, or in non-compliance
with, such obligations following the purchase hereinafter described), TFC will
purchase Eligible Notes (as hereinafter defined) from Selmer in an aggregate
amount at any time outstanding not to exceed $15 Million. The purchase price for
each Eligible Note shall be equal to the outstanding principal balance of such
Eligible Note at the time of purchase (the "Purchase Price").

         1.2      ELIGIBLE NOTES.  An "Eligible Note" is a Note which:

                  ( a )    is not in default;

                  ( b )    conforms to the documentation requirements set forth
                           in Section 1.4;

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                  ( c )    is for a term not to exceed twenty-four (24) months;

                  ( d )    provides for full straight line amortization of the
                           principal balance thereof (or some other amortization
                           of principal acceptable to TFC); and

                  ( e )    is from a Dealer with which TFC has not had a prior
                           unsatisfactory relationship.

         In order for TFC to make a determination as to the eligibility of a
Note, Selmer shall submit a list of Dealers to TFC and update such list on a
regular basis. In addition, if TFC's purchase of a Note would result in the
aggregate amount of outstanding principal under all Notes purchased by TFC with
respect to the subject Dealer exceeding $500,000.00, such Note shall not be an
"Eligible Note" unless TFC determines that the creditworthiness of such Dealer
is acceptable.

         1.3 MINIMUM YIELD ON PURCHASED NOTES. To the extent that any Eligible
Note purchased by TFC (a "Purchased Note") accrues interest in any month at a
rate (the "Note Rate") less than the Minimum Acceptable Interest Rate (as
hereinafter defined), Selmer agrees to pay to TFC, on or before the twentieth
(20th) day of the following month, the difference between the amount of interest
accrued during such month at the Note Rate and the amount of interest which
would have accrued during such month at the Minimum Acceptable Interest Rate.
The Minimum Acceptable Interest Rate shall be a variable rate per annum,
adjusted monthly, equal to Prime plus three and one-quarter percent (3.25%).
Prime for any month shall be the greater of: (a) the prime commercial rate of
interest per annum published by the index bank referenced in the Purchased Notes
on the last day of the preceding month, or (b) Seven percent (7.0%) per annum.
Unless otherwise specified in the Purchased Notes, all interest calculations
under the Purchased Notes shall be done using a year of 360 days and the actual
number of days elapsed in the computation period.

         1.4 REQUEST FOR PURCHASE OF A NOTE. Selmer may, from time to time,
request that TFC purchase Notes. Selmer shall not sell any Note to any other
party unless Selmer has first requested that TFC purchase such Note. Any such
request shall be made by submitting, for each Note, a completed Request for
Purchase of a Note in the form attached hereto as EXHIBIT 1.4(a); and the sole
original of such Note in the form attached hereto as EXHIBIT 1.4(b) ("Original
Note"). In addition, TFC shall have the right to receive copies of the
bookkeeping counterpart of all invoices identifying the indebtedness evidenced
by such Original Note (the "Invoices") and upon such request made by TFC, Selmer
shall deliver the Invoices within seven (7) business days. Such Original Note
shall have been executed on behalf of the Dealer obligated thereon by an
authorized officer of The Selmer Company, Inc., pursuant to a valid power of
attorney, and shall be endorsed to TFC by Selmer as shown in EXHIBIT 1.4(b). The
Invoices and supporting material shall collectively identify the Selmer Products
being sold pursuant thereto by model and serial number, except for various
accessory Selmer Products which do not bear serial numbers and which will not,
in the aggregate, constitute more than five percent (5.0%) of the value of the
Selmer Products identified on the Invoices. Provided that the Original Note is
an Eligible Note, TFC shall pay the Purchase Price for such Note to Selmer, or
Selmer's designee, in immediately available funds, by wire transfer, within
three (3) business days following TFC's receipt of the foregoing documents in
acceptable form. If TFC determines that any Note submitted for purchase is not
an Eligible Note, TFC shall return all documents associated with such submission
to Selmer within five days (5) following TFC's receipt of the foregoing
documents.

         1.5 ASSIGNMENT OF SECURITY AND OTHER RIGHTS. In connection with each
Purchased Note, Selmer assigns to TFC all of Selmer's rights to payment of the
indebtedness evidenced by such

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Purchased Note, all of Selmer's rights associated with Selmer Products
identified on the Invoices, an undivided joint interest in all other security or
such indebtedness in which Selmer has an interest, and an undivided joint
interest rights of Selmer associated with such indebtedness. The rights of
Selmer described in the foregoing sentence include, but are not limited to,
Selmer's rights under the Security Agreement and Power of Attorney entered into
by Selmer with the applicable Dealer, any Guaranty and Waiver By Individual(s)
or similar instrument(s) executed in connection therewith, and Selmer's interest
under policies of insurance covering Selmer Products owned by the applicable
Dealer. The collection of writings evidencing the rights described in this
Section, including the Purchased Notes, are hereinafter referred to as the
"Chattel Paper."

         1.6 PERFECTION AND PROTECTION OF TFC'S INTEREST IN PURCHASED CHATTEL
PAPER. TFC shall perfect its interest in all purchased Chattel Paper by filing
an appropriate UCC-1 Financing Statement identifying the Chattel Paper to be
purchased. In addition, all original instruments executed between Selmer and the
Dealers associated with purchased Chattel Paper, pursuant to which such Dealers
have granted a security interest in Selmer Products to Selmer, shall be
conspicuously stamped with the legend set forth at EXHIBIT 1.6 hereto.

         1.7 ALTERATION OF CHATTEL PAPER AND WAIVER OF RIGHTS. For so long as
there are outstanding amounts owing to TFC under a Purchased Note or Purchased
Notes, Selmer agrees not to amend, supplement or otherwise alter, or waive any
rights under, any of the purchased Chattel Paper associated therewith without
TFC's prior consent. TFC agrees not to amend, supplement or otherwise alter, or
waive any rights under, any purchase Chattel Paper without Selmer's prior
consent, except for purchased Chattel Paper associated with a Purchased Note or
Purchased Notes for which Selmer has failed to honor its repurchase obligations
under this Agreement.

                        ARTICLE II - REPURCHASE OF NOTES

         2.1      REPURCHASE  OF NOTES.  Selmer  shall be  obligated,  if
 requested  by TFC,  to  repurchase  all or a portion  of the Purchased Notes
under the following circumstances:

                  (a) Selmer shall be obligated, if requested by TFC, to
repurchase all of the Purchased Notes relating to a particular Dealer if any of
the following occur: (i) such Dealer defaults in the payment of principal and/or
interest under the applicable Purchased Note(s) and such obligation(s) is past
due more than ninety (90) days; (ii) such Dealer is otherwise in default under
the terms of the applicable Purchased Note(s); or (iii) Selmer breaches the
terms of any warranty contained in Sections 3.4 and 3.5 of this Agreement as
such warranty relates to such Dealer or the applicable Purchased Notes; and

                  (b) Selmer shall be obligated, if requested by TFC, to
repurchase ALL Purchased Notes if Selmer: (i) breaches any provision of this
Agreement, other than the warranties set forth in Sections 3.4 and 3.5 of this
agreement; (ii) is in default under the terms and conditions of any loan, lease,
or similar agreement pursuant to which Selmer's aggregate obligations are $1
Million or more and all applicable grace periods for the cure of such default
have expired; or (iii) is the subject of a bankruptcy, receivership or similar
proceeding which, if involuntary, is not dismissed within thirty (30) days
following its commencement.

         In the event that Selmer is obligated to repurchase a Purchased Note
because of a circumstance set forth in the foregoing Subparagraph (a), Clause
(i) or Clause (ii), Selmer shall have the right to cause such Dealer to cure
such default (in its entirety) within thirty (30) days following receipt of
notice from

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                                       4

 TFC of the occurrence of such circumstance. In the event that Selmer
is obligated to repurchase some or all of the Purchased Notes because of a
circumstance set forth in the foregoing Subparagraph (a), Clause (iii), or
Subparagraph (b), Clause (i) (expect for Selmer's breach of the warranties
and/or obligations set forth in Sections 1.3, 2.2, 4.1, 4.2(b) and 4.4(b) of
this Agreement), Selmer shall have the right to cure such breach within thirty
(30) days following receipt of notice from TFC of the occurrence of such breach.

         2.2 REPURCHASE PRICE. The Repurchase Price for a Purchased Note shall
be equal to all principal, accrued interest and other charges owing to TFC
pursuant to such Purchased Note, and owing to TFC by Selmer pursuant to Section
1.3, as of the date that Selmer pays the Repurchase Price to TFC. Selmer shall
pay the Repurchase Price for a Purchased Note to TFC within fifteen (15) days
following receipt of notice from TFC that Selmer is required to repurchase such
Purchased Note.

         2.3 REASSIGNMENT OF RIGHTS. In connection with Selmer's repurchase of a
Purchased Note, TFC shall reassign to Selmer all of TFC's rights in the Chattel
Paper associated therewith previously assigned to TFC by Selmer. TFC warrants
that such assignment of rights shall be free and clear of the interest of any
party claiming such interest through TFC. TFC shall endorse the applicable
Original Note to Selmer, without recourse, and shall return such Original Note
to Selmer together with the Invoices related thereto.

                       ARTICLE III - WARRANTIES OF SELMER

         Selmer continuously warrants to TFC as follows:

         3.1 ORGANIZATION. Selmer is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and has
all requisite power and authority to own, operate and lease its properties and
to carry on its business as presently being conducted. Selmer is duly qualified
to do business and is in good standing in each jurisdiction in which the
property owned, leased or operated by Selmer, or the nature of the business
conducted by Selmer, makes such qualification necessary, except where the
failure to be so qualified would not have an adverse effect on the financial
condition or business prospects of Selmer (an "Adverse Effect").

         3.2 AUTHORIZATION. Selmer has the power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
Selmer has duly approved and authorized the execution and delivery of this
Agreement, and no other proceedings on the part of Selmer are necessary in
connection therewith. This Agreement constitutes a valid and binding obligation
of Selmer, enforceable against Selmer in accordance with its terms.

         3.3 AUTHORITY. The compliance by Selmer with the provisions hereof will
not: ( a ) violate any provision of the charter documents or by-laws of Selmer;
( b ) violate any provision of, constitute a default under (or an event which,
with notice or lapse of time or both, would constitute a default under), or
result in the creation of any lien, security interest, charge of encumbrance
upon any of the properties of Selmer, pursuant to the terms of any agreement,
instrument or other obligation to which Selmer is party or by which any of
Selmer's properties are bound; ( c ) violate any order, rule or regulation of
any court or governmental authority; or ( d ) require the consent of, or notice
to, any governmental or regulatory authority.

         3.4 PURCHASED CHATTEL PAPER. All of the documents associated with
purchased Chattel Paper contained in Selmer's credit or documentation files are,
in all material respects, what they purport

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                                       5

to be and, as appropriate, are valid and binding obligations of the Dealer
associated therewith, enforceable against such Dealer in accordance with their
terms, except: (a) as enforcement may be limited by bankruptcy or other similar
laws affecting the enforcement of creditors' rights generally; and (b) that the
remedy of specific performance and other forms of equitable relief are subject
to judicial discretion. Selmer has good and marketable title to the purchased
Chattel Paper and to the indebtedness evidenced thereby, free and clear of all
defenses, set-offs, counterclaims, liens and encumbrances of every kind and
nature. Each Purchased Note constitutes a bona fide loan by Selmer to the
applicable Dealer, in an amount equal to the Purchase Price for such Eligible
Note. Selmer has not accepted interest, or any other similar amounts, from any
Dealer obligated on any Purchased Note in advance of any due date occurring
after the date that Selmer completes a Request for Purchase of a Note with
respect thereto.

         3.5 PRIORITY OF LIENS AND INSURANCE. Selmer has a perfected security
interest in all Selmer Products owned by each Dealer associated with a Purchased
Note. Selmer has a first priority security interest in each of the Selmer
Products which is identified on the Invoices. Each Dealer associated with a
Purchased Note has obtained property insurance covering its inventory of Selmer
Products for their full replacement value and naming Selmer as Loss Payee.

         3.6 REPORTS AND INFORMATION. All reports and information delivered or
conveyed by Selmer to TFC pertaining to the Purchased Notes are accurate and
complete in all material respects.

         3.7 LITIGATION. There are no proceedings before any court or
governmental authority (each a "Proceeding") pending or, to the best of Selmer's
knowledge, threatened against Selmer which, if adversely determined, would have
an Adverse Effect. Selmer is not subject to any judgment or other order entered
in any law suit or proceeding which would have an Adverse Effect.

         3.8 COMPLIANCE WITH LAWS. The Purchased Notes have been entered into by
Selmer in accordance with all applicable laws and other requirements of
governmental authorities (including, but not limited to, usury, equal credit
opportunity and similar laws or regulations), except where the failure to comply
with such laws, regulations or other requirements would not have an Adverse
Effect.

            ARTICLE IV - AFFIRMATIVE AND NEGATIVE COVENANTS OF SELMER

         Selmer covenants and agrees with TFC as follows:

         4.1 FINANCIAL STATEMENTS. Selmer shall deliver to TFC, within one
hundred twenty (120) days following the close of each of its fiscal years,
Selmer's financial statements, certified by a recognized firm of certified
public accountants as having been prepared in accordance with generally accepted
accounting principles and as presenting fairly the financial condition of Selmer
as of the date thereof and for the period then ended. Selmer shall deliver to
TFC such other financial information as TFC shall reasonably request, including,
within forty-five (45) days following the close of each of Selmer's fiscal
quarters, Selmer's financial statements, certified by the chief financial
officer of Selmer as having been prepared in accordance with generally accepted
accounting principles and in a manner consistent with the normal accounting
practices of Selmer. Each time that Selmer delivers Selmer's financial
statements to TFC, Selmer shall also deliver a certificate from the chief
financial officer of Selmer indicating whether Selmer was in compliance with the
provisions of Section 4.6 of this Agreement as of the date of such financial
statements.

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                                       6

         4.2 BOOKS AND RECORDS. Selmer shall: (a) keep accurate and complete
records pertaining to the purchased Chattel Paper, and (b) permit TFC, upon
reasonable notice and at reasonable times, to audit the credit and documentation
files of a Dealer associated with purchased Chattel Paper, or an Eligible Note
which Selmer has requested that TFC purchase.

         4.3 ADDITIONAL DOCUMENTATION. Selmer shall execute and deliver to TFC
all additional documents which TFC may, from time to time, determine are
necessary or appropriate to evidence or perfect TFC's interest in the purchased
Chattel Paper.

         4.4 EXISTENCE, NAME AND PRINCIPAL PLACE OF BUSINESS. Selmer shall: (a)
maintain its existence in good standing, and (b)deliver to TFC written notice,
at least sixty (60) days in advance, of any proposed change in Selmer's name or
the location of Selmer's principal place of business.

         4.5 BREACH OR DEFAULT. Selmer shall notify TFC as soon as reasonably
possible upon the occurrence of any circumstance which puts Selmer in breach of
any of Selmer's covenants, warranties or agreements contained in this Agreement.

         4.6 FINANCIAL COVENANTS. Selmer shall not permit its: (a) Tangible Net
Worth (as hereinafter defined) to be less than $41 Million, or (b) the ratio of
its Adjusted Indebtedness (as hereinafter defined) to Tangible Net Worth to be
greater than 2.0 to 1.0. "Tangible Net Worth" means the shareholders equity of
Selmer, increased by Selmer's minimum pension liability and Subordinated Debt
(as hereinafter defined), and reduced by Selmer's intangible assets.
"Subordinated Debt" includes in the Senior Secured Notes (in the original
principal amount of $53 Million) and any other indebtedness of Selmer owing to a
party which has subordinated its right to payment of such indebtedness to the
right of TFC to payment under this Agreement. "Adjusted Indebtedness" means
Selmer's total liabilities, reduced by unfunded pension liability and the
reserves for recourse notes.

                            ARTICLE V - MISCELLANEOUS

         5.1 TERM OF AGREEMENT. This Agreement shall be in effect for a period
of one (1) year from the date hereof. TFC may terminate this Agreement if Selmer
is, at any time, obligated to repurchase all Purchased Notes. Any termination or
expiration of this Agreement shall not affect the obligations of Selmer and TFC
under this Agreement with respect to Chattel Paper purchased by TFC from Selmer.

         5.2 POWER OF ATTORNEY. Selmer irrevocably appoints TFC, and any person
designated by TFC, for so long as any obligation remains outstanding under any
Purchased Note, as Selmer's true and lawful attorney-in-fact to: (a) endorse, in
TFC's or Selmer's name, any draft or other order for the payment of money
payable to Selmer and related to the purchased Chattel Paper, and (b) execute,
in TFC's or Selmer's name, all other instruments and documents necessary or
appropriate to enable TFC to enforce TFC's rights in the purchased Chattel Paper
against any associated Dealer.

         5.3 INTEGRATION, MODIFICATION AND COURSE OF DEALING. This Agreement
constitutes the entire agreement of Selmer and TFC relative to the subject
matter hereof. No modification of, or supplement to, this Agreement shall bind
Selmer or TFC unless in writing and signed by an authorized officer of Selmer or
TFC, as appropriate. No course of dealing and no delay or failure of Selmer or
TFC to exercise any right, power or privilege under this Agreement will affect
any other or future exercise of such right, power or privilege.

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         5.4 ASSIGNMENT AND DELEGATION. Selmer shall have the right, from time
to time, to sell, assign or otherwise transfer its entire interest in this
Agreement to any entity which it controls, is controlled by, or is under common
control with Selmer. Selmer may not assign or transfer any of its rights or
delegate any of its obligations under this Agreement under any other
circumstances. TFC shall have the right, from time to time, to sell, assign or
otherwise transfer its interest in this Agreement and the purchased Chattel
Paper, either in whole or in part, to any entity which controls, is controlled
by, or is under common control with TFC.

         5.5 NOTICES. All notices, requests, demands and other communications
made pursuant to this Agreement (the "Notices") shall be in writing and shall be
sent by certified mail, return receipt requested. All of the Notices shall be
sent to TFC (Attention: Vice President - Operations) or Selmer (Attention: Vice
President of Finance) at the address for such party set forth at the end of this
Agreement or to such other address as such party shall designate from time to
time.

         5.6 BINDING EFFECT AND GOVERNING LAW. This Agreement shall not be
deemed to create any right in any party except as provided herein and shall
inure to the benefit of, and by binding upon, the successors and assigns of
Selmer and TFC. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF RHODE ISLAND, WITHOUT REFERENCE TO APPLICABLE
CONFLICT OF LAW PRINCIPLES.

         The undersigned, pursuant to due corporate and/or partnership
authority, have caused this Agreement to be executed as of the date set forth
above.

                        TFC:

                        TEXTRON FINANCIAL CORPORATION

                        By:              /S/ JOHN K. KING
                                         --------------------------------------
                        Print Name:      JOHN K. KING
                                         -------------------------------
                        Print Title:     VICE PRESIDENT-DIVISION MANAGER
                                         --------------------------------------
                        Address:         701 Xenia Avenue South, Suite 300
                                         Golden Valley, MN  55416

                        SELMER:

                        THE SELMER COMPANY, INC.

                        By:              /S/ MICHAEL R. VICKREY
                                         --------------------------------------
                        Print Name:      MICHAEL R. VICKREY
                                         --------------------------------------
                        Print Title:     EXECUTIVE V.P. - FINANCE
                                         --------------------------------------
                        Address:         600 Industrial Parkway
                                         Elkhart, IN  46516<PAGE>

                                                                   Exhibit 10.11

                  MASTER NOTE PURCHASE AND REPURCHASE AGREEMENT

This Master Note Purchase and Repurchase Agreement (this "Agreement") is
executed as of August 31, 2000 by Emerson Musical Instruments, Inc. with an
address of 28135 West Hively, Elkhart, IN 46517 ("Emerson") and Textron
Financial Corporation with an address of 701 Xenia Avenue South, Suite 300,
Golden Valley, MN 55416 ("TFC").

                                    RECITALS

A.       Emerson manufactures and distributes musical instruments ("Emerson
Products")and extends credit to selected retail dealers of Emerson Products
("Dealers"), facilitating the acquisition of Emerson Products by such Dealers
(the "Floor Plan");

B.       In order to secure the Floor Plan,  among other security,  Emerson
establishes a first priority security interest in the Emerson Products financed
pursuant to the Floor Plan;

C.       Emerson,  from time to time,  pursuant  to powers of  attorney  granted
to Emerson by Dealers, executes promissory notes on behalf of Dealers evidencing
all or a portion of the outstanding indebtedness under the Floor Plan (the
"Notes");

D.       Emerson and TFC intend that TFC will, from time to time, in an amount
not to exceed an aggregate of $1 Million at any time outstanding and with full
recourse to Emerson, purchase the Notes and take an assignment of all security
for, and all other rights of Emerson associated with, such Notes and the
indebtedness evidenced thereby; and

E.       Emerson shall be obligated to repurchase the Notes under the
circumstances set forth in this agreement.

                                    AGREEMENT

In reliance upon the various representations, warranties and covenants set forth
in this Agreement, Emerson and TFC agree as follows:

                          ARTICLE I - PURCHASE OF NOTES

1.1      PURCHASE OF NOTES. Provided that Emerson is in compliance with, and is
not in breach of, any of its warranties, covenants or other obligations set
forth in this Agreement (and will not be in breach of, or in non-compliance
with, such obligations following the purchase hereinafter described), TFC will
purchase Eligible Notes (as hereinafter defined) from Emerson in an aggregate
amount at any time outstanding not to exceed $1 Million. The purchase price for
each Eligible Note shall be equal to the outstanding principal balance of such
Eligible Note at the time of purchase (the "Purchase Price").

1.2      ELIGIBLE NOTES.  An "Eligible Note" is a Note which:

                  ( a )    is not in default;
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                  ( b )    conforms to the documentation requirements set forth
                  in Section 1.4;

                  ( c )    is for a term not to exceed twenty-four (24) months;

                  ( d ) provides for full straight line amortization of the
                  principal balance thereof (or some other amortization of
                  principal acceptable to TFC); and

                  ( e )    is from a Dealer with which TFC has not had a prior
                  unsatisfactory relationship.

In order for TFC to make a determination as to the eligibility of a Note,
Emerson shall submit a list of Dealers to TFC and update such list on a regular
basis. In addition, if TFC's purchase of a Note would result in the aggregate
amount of outstanding principal under all Notes purchased by TFC with respect to
the subject Dealer exceeding $500,000.00, such Note shall not be an "Eligible
Note" unless TFC determines that the creditworthiness of such Dealer is
acceptable.

1.3      MINIMUM YIELD ON PURCHASED NOTES. To the extent that any Eligible Note
purchased by TFC (a "Purchased Note") accrues interest in any month at a rate
(the "Note Rate") less than the Minimum Acceptable Interest Rate (as hereinafter
defined), Emerson agrees to pay to TFC, on or before the twentieth (20th) day of
the following month, the difference between the amount of interest accrued
during such month at the Note Rate and the amount of interest which would have
accrued during such month at the Minimum Acceptable Interest Rate. The Minimum
Acceptable Interest Rate shall be a variable rate per annum, adjusted monthly,
equal to Prime plus three and one-quarter percent (3.25%). Prime for any month
shall be the greater of: (a) the prime commercial rate of interest per annum
published by the index bank referenced in the Purchased Notes on the last day of
the preceding month, or (b) Seven percent (7.0%) per annum. Unless otherwise
specified in the Purchased Notes, all interest calculations under the Purchased
Notes shall be done using a year of 360 days and the actual number of days
elapsed in the computation period.

1.4      REQUEST FOR PURCHASE OF A NOTE. Emerson may, from time to time, request
that TFC purchase Notes. Emerson shall not sell any Note to any other party
unless Emerson has first requested that TFC purchase such Note. Any such request
shall be made by submitting, for each Note, a completed Request for Purchase of
a Note in the form attached hereto as EXHIBIT 1.4(a); and the sole original of
such Note in the form attached hereto as EXHIBIT 1.4(b) ("Original Note"). In
addition, TFC shall have the right to receive copies of the bookkeeping
counterpart of all invoices identifying the indebtedness evidenced by such
Original Note (the "Invoices") and upon such request made by TFC, Emerson shall
deliver the Invoices within seven (7) business days. Such Original Note shall
have been executed on behalf of the Dealer obligated thereon by an authorized
officer of Emerson Musical Instruments, Inc., pursuant to a valid power of
attorney, and shall be endorsed to TFC by Emerson as shown in EXHIBIT 1.4(b).
The Invoices and supporting material shall collectively identify the Emerson
Products being sold pursuant thereto by model and serial number, except for
various accessory Emerson Products which do not bear serial numbers and which
will not, in the aggregate, constitute more than five percent (5.0%) of the
value of the Emerson Products identified on the Invoices. Provided that the
Original Note is an Eligible Note, TFC shall pay the Purchase Price for such
Note to Emerson, or Emerson's designee, in immediately available funds, by wire
transfer, within three (3) business days following TFC's receipt of the
foregoing documents in acceptable form. If TFC determines that any Note
submitted for purchase is not an Eligible Note, TFC shall return all documents
associated with such submission to Emerson within five days (5) following TFC's
receipt of the foregoing documents.
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                                       3

1.5      ASSIGNMENT OF SECURITY AND OTHER RIGHTS. In connection with each
Purchased Note, Emerson assigns to TFC all of Emerson's rights to payment of the
indebtedness evidenced by such Purchased Note, all of Emerson's rights
associated with Emerson Products identified on the Invoices, an undivided joint
interest in all other security or such indebtedness in which Emerson has an
interest, and an undivided joint interest rights of Emerson associated with such
indebtedness. The rights of Emerson described in the foregoing sentence include,
but are not limited to, Emerson's rights under the Security Agreement and Power
of Attorney entered into by Emerson with the applicable Dealer, any Guaranty and
Waiver By Individual(s) or similar instrument(s) executed in connection
therewith, and Emerson's interest under policies of insurance covering Emerson
Products owned by the applicable Dealer. The collection of writings evidencing
the rights described in this Section, including the Purchased Notes, are
hereinafter referred to as the "Chattel Paper."

1.6      PERFECTION AND PROTECTION OF TFC'S INTEREST IN PURCHASED CHATTEL PAPER.
TFC shall perfect its interest in all purchased Chattel Paper by filing an
appropriate UCC-1 Financing Statement identifying the Chattel Paper to be
purchased. In addition, all original instruments executed between Emerson and
the Dealers associated with purchased Chattel Paper, pursuant to which such
Dealers have granted a security interest in Emerson Products to Emerson, shall
be conspicuously stamped with the legend set forth at EXHIBIT 1.6 hereto.

1.7      ALTERATION OF CHATTEL PAPER AND WAIVER OF RIGHTS. For so long as there
are outstanding amounts owing to TFC under a Purchased Note or Purchased Notes,
Emerson agrees not to amend, supplement or otherwise alter, or waive any rights
under, any of the purchased Chattel Paper associated therewith without TFC's
prior consent. TFC agrees not to amend, supplement or otherwise alter, or waive
any rights under, any purchase Chattel Paper without Emerson's prior consent,
except for purchased Chattel Paper associated with a Purchased Note or Purchased
Notes for which Emerson has failed to honor its repurchase obligations under
this Agreement.

                        ARTICLE II - REPURCHASE OF NOTES

2.1      REPURCHASE OF NOTES.  Emerson shall be obligated,  if requested by TFC,
to repurchase all or a portion of the Purchased Notes under the following
circumstances:

(a)      Emerson shall be obligated, if requested by TFC, to repurchase all of
the Purchased Notes relating to a particular Dealer if any of the following
occur: (i) such Dealer defaults in the payment of principal and/or interest
under the applicable Purchased Note(s) and such obligation(s) is past due more
than ninety (90) days; (ii) such Dealer is otherwise in default under the terms
of the applicable Purchased Note(s); or (iii) Emerson breaches the terms of any
warranty contained in Sections 3.4 and 3.5 of this Agreement as such warranty
relates to such Dealer or the applicable Purchased Notes; and

(b)      Emerson shall be obligated, if requested by TFC, to repurchase ALL
Purchased Notes if Emerson: (i) breaches any provision of this Agreement, other
than the warranties set forth in Sections 3.4 and 3.5 of this agreement; (ii) is
in default under the terms and conditions of any loan, lease, or similar
agreement pursuant to which Emerson's aggregate obligations are $1 Million or
more and all applicable grace periods for the cure of such default have expired;
or (iii) is the subject of a bankruptcy, receivership or similar proceeding
which, if involuntary, is not dismissed within thirty (30) days following its
commencement.

In the event that Emerson is obligated to repurchase a Purchased Note because
of a circumstance set forth in the foregoing Subparagraph (a), Clause (i) or
Clause (ii), Emerson shall have the right to cause such

<PAGE>
                                       4

Dealer to cure such default (in its entirety) within thirty (30) days following
receipt of notice from TFC of the occurrence of such circumstance. In the event
that Emerson is obligated to repurchase some or all of the Purchased Notes
because of a circumstance set forth in the foregoing Subparagraph (a), Clause
(iii), or Subparagraph (b), Clause (i) (expect for Emerson's breach of the
warranties and/or obligations set forth in Sections 1.3, 2.2, 4.1, 4.2(b) and
4.4(b) of this Agreement), Emerson shall have the right to cure such breach
within thirty (30) days following receipt of notice from TFC of the occurrence
of such breach.

2.2      REPURCHASE PRICE. The Repurchase Price for a Purchased Note shall be
equal to all principal, accrued interest and other charges owing to TFC pursuant
to such Purchased Note, and owing to TFC by Emerson pursuant to Section 1.3, as
of the date that Emerson pays the Repurchase Price to TFC. Emerson shall pay the
Repurchase Price for a Purchased Note to TFC within fifteen (15) days following
receipt of notice from TFC that Emerson is required to repurchase such Purchased
Note.

2.3      REASSIGNMENT OF RIGHTS. In connection with Emerson's repurchase of a
Purchased Note, TFC shall reassign to Emerson all of TFC's rights in the Chattel
Paper associated therewith previously assigned to TFC by Emerson. TFC warrants
that such assignment of rights shall be free and clear of the interest of any
party claiming such interest through TFC. TFC shall endorse the applicable
Original Note to Emerson, without recourse, and shall return such Original Note
to Emerson together with the Invoices related thereto.

                       ARTICLE III - WARRANTIES OF EMERSON

         Emerson continuously warrants to TFC as follows:

3.1      ORGANIZATION. Emerson is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and has all
requisite power and authority to own, operate and lease its properties and to
carry on its business as presently being conducted. Emerson is duly qualified to
do business and is in good standing in each jurisdiction in which the property
owned, leased or operated by Emerson, or the nature of the business conducted by
Emerson, makes such qualification necessary, except where the failure to be so
qualified would not have an adverse effect on the financial condition or
business prospects of Emerson (an "Adverse Effect").

3.2      AUTHORIZATION. Emerson has the power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
Emerson has duly approved and authorized the execution and delivery of this
Agreement, and no other proceedings on the part of Emerson are necessary in
connection therewith. This Agreement constitutes a valid and binding obligation
of Emerson, enforceable against Emerson in accordance with its terms.

3.3      AUTHORITY. The compliance by Emerson with the provisions hereof will
not: ( a ) violate any provision of the charter documents or by-laws of Emerson;
( b ) violate any provision of, constitute a default under (or an event which,
with notice or lapse of time or both, would constitute a default under), or
result in the creation of any lien, security interest, charge or encumbrance
upon any of the properties of Emerson, pursuant to the terms of any agreement,
instrument or other obligation to which Emerson is party or by which any of
Emerson's properties are bound; ( c ) violate any order, rule or regulation of
any court or governmental authority; or ( d ) require the consent of, or notice
to, any governmental or regulatory authority.
<PAGE>
                                       5

3.4      PURCHASED CHATTEL PAPER. All of the documents associated with purchased
Chattel Paper contained in Emerson's credit or documentation files are, in all
material respects, what they purport to be and, as appropriate, are valid and
binding obligations of the Dealer associated therewith, enforceable against such
Dealer in accordance with their terms, except: (a) as enforcement may be limited
by bankruptcy or other similar laws affecting the enforcement of creditors'
rights generally; and (b) that the remedy of specific performance and other
forms of equitable relief are subject to judicial discretion. Emerson has good
and marketable title to the purchased Chattel Paper and to the indebtedness
evidenced thereby, free and clear of all defenses, set-offs, counterclaims,
liens and encumbrances of every kind and nature. Each Purchased Note constitutes
a bona fide loan by Emerson to the applicable Dealer, in an amount equal to the
Purchase Price for such Eligible Note. Emerson has not accepted interest, or any
other similar amounts, from any Dealer obligated on any Purchased Note in
advance of any due date occurring after the date that Emerson completes a
Request for Purchase of a Note with respect thereto.

3.5      PRIORITY OF LIENS AND INSURANCE. Emerson has a perfected security
interest in all Emerson Products owned by each Dealer associated with a
Purchased Note. Emerson has a first priority security interest in each of the
Emerson Products which is identified on the Invoices. Each Dealer associated
with a Purchased Note has obtained property insurance covering its inventory of
Emerson Products for their full replacement value and naming Emerson as Loss
Payee.

3.6      REPORTS AND INFORMATION. All reports and information delivered or
conveyed by Emerson to TFC pertaining to the Purchased Notes are accurate and
complete in all material respects.

3.7      LITIGATION. There are no proceedings before any court or governmental
authority (each a "Proceeding") pending or, to the best of Emerson's knowledge,
threatened against Emerson which, if adversely determined, would have an Adverse
Effect. Emerson is not subject to any judgment or other order entered in any law
suit or proceeding which would have an Adverse Effect.

3.8      COMPLIANCE WITH LAWS. The Purchased Notes have been entered into by
Emerson in accordance with all applicable laws and other requirements of
governmental authorities (including, but not limited to, usury, equal credit
opportunity and similar laws or regulations), except where the failure to comply
with such laws, regulations or other requirements would not have an Adverse
Effect.

           ARTICLE IV - AFFIRMATIVE AND NEGATIVE COVENANTS OF EMERSON

Emerson covenants and agrees with TFC as follows:

4.1      BOOKS AND RECORDS. Emerson shall: (a) keep accurate and complete
records pertaining to the purchased Chattel Paper, and (b) permit TFC, upon
reasonable notice and at reasonable times, to audit the credit and documentation
files of a Dealer associated with purchased Chattel Paper, or an Eligible Note
which Emerson has requested that TFC purchase.

4.2      ADDITIONAL DOCUMENTATION. Emerson shall execute and deliver to TFC all
additional documents which TFC may, from time to time, determine are necessary
or appropriate to evidence or perfect TFC's interest in the purchased Chattel
Paper.

4.3      EXISTENCE,  NAME AND  PRINCIPAL  PLACE OF BUSINESS.  Emerson  shall:
(a) maintain its existence in good standing, and (b) deliver to TFC written
notice, at least sixty (60) days in advance, of any proposed change in Emerson's
name or the location of Emerson's principal place of business.
<PAGE>
                                       6

4.4      BREACH OR DEFAULT. Emerson shall notify TFC as soon as reasonably
possible upon the occurrence of any circumstance which puts Emerson in breach of
any of Emerson's covenants, warranties or agreements contained in this
Agreement.

                            ARTICLE V - MISCELLANEOUS

5.1      TERM OF AGREEMENT. This Agreement shall be in effect for a period of
one (1) year from the date hereof. TFC may terminate this Agreement if Emerson
is, at any time, obligated to repurchase all Purchased Notes. Any termination or
expiration of this Agreement shall not affect the obligations of Emerson and TFC
under this Agreement with respect to Chattel Paper purchased by TFC from
Emerson.

5.2      POWER OF ATTORNEY. Emerson irrevocably appoints TFC, and any person
designated by TFC, for so long as any obligation remains outstanding under any
Purchased Note, as Emerson's true and lawful attorney-in-fact to: (a) endorse,
in TFC's or Emerson's name, any draft or other order for the payment of money
payable to Emerson and related to the purchased Chattel Paper, and (b) execute,
in TFC's or Emerson's name, all other instruments and documents necessary or
appropriate to enable TFC to enforce TFC's rights in the purchased Chattel Paper
against any associated Dealer.

5.3      INTEGRATION, MODIFICATION AND COURSE OF DEALING. This Agreement
constitutes the entire agreement of Emerson and TFC relative to the subject
matter hereof. No modification of, or supplement to, this Agreement shall bind
Emerson or TFC unless in writing and signed by an authorized officer of Emerson
or TFC, as appropriate. No course of dealing and no delay or failure of Emerson
or TFC to exercise any right, power or privilege under this Agreement will
affect any other or future exercise of such right, power or privilege.

5.4      ASSIGNMENT AND DELEGATION. Emerson shall have the right, from time to
time, to sell, assign or otherwise transfer its entire interest in this
Agreement to any entity which it controls, is controlled by, or is under common
control with Emerson. Emerson may not assign or transfer any of its rights or
delegate any of its obligations under this Agreement under any other
circumstances. TFC shall have the right, from time to time, to sell, assign or
otherwise transfer its interest in this Agreement and the purchased Chattel
Paper, either in whole or in part, to any entity which controls, is controlled
by, or is under common control with TFC.

5.5      NOTICES. All notices, requests, demands and other communications made
pursuant to this Agreement (the "Notices") shall be in writing and shall be sent
by certified mail, return receipt requested. All of the Notices shall be sent to
TFC (Attention: Vice President - Operations) or Emerson (Attention: Vice
President of Finance) at the address for such party set forth at the end of this
Agreement or to such other address as such party shall designate from time to
time.

5.6      BINDING EFFECT AND GOVERNING LAW. This Agreement shall not be deemed
to create any right in any party except as provided herein and shall inure to
the benefit of, and by binding upon, the successors and assigns of Emerson and
TFC. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF RHODE ISLAND, WITHOUT REFERENCE TO APPLICABLE CONFLICT OF
LAW PRINCIPLES.
<PAGE>
                                       7

The undersigned, pursuant to due corporate and/or partnership authority, have
caused this Agreement to be executed as of the date set forth above.

                                  TFC:

                                  TEXTRON FINANCIAL CORPORATION

                                  By:          /s/  John K. King
                                               ---------------------------------
                                  Print Name:  John K. King
                                               ---------------------------------
                                  Print Title: Vice President-Division Manager
                                               ---------------------------------
                                  Address:     701 Xenia Avenue South, Suite 300
                                               Golden Valley, MN  55416

                                  EMERSON:

                                  EMERSON MUSICAL INSTRUMENTS, INC.

                                  By:          /s/  M.R. Vickrey
                                               ---------------------------------
                                  Print Name:  M.R. Vickrey
                                               ---------------------------------
                                  Print Title: Treasurer
                                               ---------------------------------
                                  Address:     28135 West Hively
                                               Elkhart, IN  46517

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