SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
AMENDMENT NO. 1
Under the Securities Exchange Act of 1934
DMI FURNITURE, INC.
(Name of Issuer)
COMMON STOCK, $.10 PAR VALUE
(Title of Class of Securities)
233230 10 1
(CUSIP Number)
Joseph G. Hill
Secretary
DMI Furniture, Inc.
One Oxmoor Place
101 Bullitt Lane
Louisville, Kentucky 40222
(502)426-4351
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
August 7, 1996
(Date of Event Which Requires Filing of This Statement)
<PAGE>
CUSIP NO. - 233230 10 1
(1) Name of reporting person. . . . . . . . . Donald D. Dreher
S.S. or I.R.S. No. of
above person. . . . . . . . . . . . . . . ###-##-####
(2) Check the appropriate box
if a member of a group
(see instructions). . . . . . . . . . . . (a)
(b) X
(3) SEC use only. . . . . . . . . . . . . . .
(4) Source of funds (see instructions). . . . 00, PF
(5) Check box if disclosure
of legal proceedings is
required pursuant to
Items 2(d) or 2(e). . . . . . . . . . . .
(6) Citizenship or place
of organization . . . . . . . . . . . . . U.S.
Number of shares beneficially
owned by each reporting person
with:
(7) Sole voting power. . . . . . . . . . . . . 588,612
(8) Shared voting power. . . . . . . . . . . . 0
(9) Sole dispositive power . . . . . . . . . . 588,612
(10) Shared dispositive power . . . . . . . . . 0
(11) Aggregate amount beneficially
owned by each reporting person . . . . . . 588,612
(12) Check box if the aggregate amount
in Row (11) excludes certain
shares (see instructions). . . . . . . . .
(13) Percent of class represented
by amount in Row (11). . . . . . . . . . . 16.6%
(14) Type of reporting person . . . . . . . . . IN
<PAGE>
CUSIP NO. - 233230 10 1
(1) Name of reporting person. . . . . . . . . Joseph G. Hill
S.S. or I.R.S. No. of
above person. . . . . . . . . . . . . . . ###-##-####
(2) Check the appropriate box
if a member of a group
(see instructions). . . . . . . . . . . . (a)
(b) X
(3) SEC use only. . . . . . . . . . . . . . .
(4) Source of funds (see instructions). . . . 00, PF
(5) Check box if disclosure
of legal proceedings is
required pursuant to
Items 2(d) or 2(e). . . . . . . . . . . .
(6) Citizenship or place
of organization . . . . . . . . . . . . . U.S.
Number of shares beneficially
owned by each reporting person
with:
(7) Sole voting power. . . . . . . . . . . . . 245,773
(8) Shared voting power. . . . . . . . . . . . 0
(9) Sole dispositive power . . . . . . . . . . 245,773
(10) Shared dispositive power . . . . . . . . . 0
(11) Aggregate amount beneficially
owned by each reporting person . . . . . . 245,773
(12) Check box if the aggregate amount
in Row (11) excludes certain
shares (see instructions). . . . . . . . .
(13) Percent of class represented
by amount in Row (11). . . . . . . . . . . 7.6%
(14) Type of reporting person . . . . . . . . . IN
<PAGE>
CUSIP NO. - 233230 10 1
(1) Name of reporting person. . . . . . . . . Pattco, Inc.
S.S. or I.R.S. No. of
above person. . . . . . . . . . . . . . .
(2) Check the appropriate box
if a member of a group
(see instructions). . . . . . . . . . . . (a)
(b) X
(3) SEC use only. . . . . . . . . . . . . . .
(4) Source of funds (see instructions). . . . WC
(5) Check box if disclosure
of legal proceedings is
required pursuant to
Items 2(d) or 2(e). . . . . . . . . . . .
(6) Citizenship or place
of organization . . . . . . . . . . . . . U.S.
Number of shares beneficially
owned by each reporting person
with:
(7) Sole voting power. . . . . . . . . . . . . 1,390,369
(8) Shared voting power. . . . . . . . . . . . 0
(9) Sole dispositive power . . . . . . . . . . 1,390,369
(10) Shared dispositive power . . . . . . . . . 0
(11) Aggregate amount beneficially
owned by each reporting person . . . . . . 1,390,369
(12) Check box if the aggregate amount
in Row (11) excludes certain
shares (see instructions). . . . . . . . .
(13) Percent of class represented
by amount in Row (11). . . . . . . . . . . 33.2%
(14) Type of reporting person . . . . . . . . . CO
<PAGE>
CUSIP NO. - 233230 10 1
(1) Name of reporting person. . . . . . . . . James A.
Patterson
S.S. or I.R.S. No. of
above person. . . . . . . . . . . . . . .
(2) Check the appropriate box
if a member of a group
(see instructions). . . . . . . . . . . . (a)
(b) X
(3) SEC use only. . . . . . . . . . . . . . .
(4) Source of funds (see instructions). . . . 00
(5) Check box if disclosure
of legal proceedings is
required pursuant to
Items 2(d) or 2(e). . . . . . . . . . . .
(6) Citizenship or place
of organization . . . . . . . . . . . . . U.S.
Number of shares beneficially
owned by each reporting person
with:
(7) Sole voting power. . . . . . . . . . . . . 1,390,369
(8) Shared voting power. . . . . . . . . . . . 0
(9) Sole dispositive power . . . . . . . . . . 1,390,369
(10) Shared dispositive power . . . . . . . . . 0
(11) Aggregate amount beneficially
owned by each reporting person . . . . . . 1,390,369
(12) Check box if the aggregate amount
in Row (11) excludes certain
shares (see instructions). . . . . . . . .
(13) Percent of class represented
by amount in Row (11). . . . . . . . . . . 33.2%
(14) Type of reporting person . . . . . . . . . IN
<PAGE>
CUSIP NO. - 233230 10 1
(1) Name of reporting person. . . . . . . . . . C. Edward
Glasscock
S.S. or I.R.S. No. of
above person. . . . . . . . . . . . . . . ###-##-####
(2) Check the appropriate box
if a member of a group
(see instructions). . . . . . . . . . . . (a)
(b) X
(3) SEC use only. . . . . . . . . . . . . . .
(4) Source of funds (see instructions). . . . PF, BK
(5) Check box if disclosure
of legal proceedings is
required pursuant to
Items 2(d) or 2(e). . . . . . . . . . . .
(6) Citizenship or place
of organization . . . . . . . . . . . . . U.S.
Number of shares beneficially
owned by each reporting person
with:
(7) Sole voting power. . . . . . . . . . . . . 513,223
(8) Shared voting power. . . . . . . . . . . . 0
(9) Sole dispositive power . . . . . . . . . . 513,223
(10) Shared dispositive power . . . . . . . . . 0
(11) Aggregate amount beneficially
owned by each reporting person . . . . . . 513,223
(12) Check box if the aggregate amount
in Row (11) excludes certain
shares (see instructions). . . . . . . . .
(13) Percent of class represented
by amount in Row (11). . . . . . . . . . . 14.8%
(14) Type of reporting person . . . . . . . . . IN
<PAGE>
CUSIP NO. - 233230 10 1
(1) Name of reporting person. . . . . . . . . . Charles S. Cassis
S.S. or I.R.S. No. of
above person. . . . . . . . . . . . . . . ###-##-####
(2) Check the appropriate box
if a member of a group
(see instructions). . . . . . . . . . . . (a)
(b) X
(3) SEC use only. . . . . . . . . . . . . . .
(4) Source of funds (see instructions). . . . PF
(5) Check box if disclosure
of legal proceedings is
required pursuant to
Items 2(d) or 2(e). . . . . . . . . . . .
(6) Citizenship or place
of organization . . . . . . . . . . . . . U.S.
Number of shares beneficially
owned by each reporting person
with:
(7) Sole voting power. . . . . . . . . . . . . 0
(8) Shared voting power. . . . . . . . . . . . 82,685
(9) Sole dispositive power . . . . . . . . . . 0
(10) Shared dispositive power . . . . . . . . . 82,685
(11) Aggregate amount beneficially
owned by each reporting person . . . . . . 82,685
(12) Check box if the aggregate amount
in Row (11) excludes certain
shares (see instructions). . . . . . . . .
(13) Percent of class represented
by amount in Row (11). . . . . . . . . . . 2.7%
(14) Type of reporting person . . . . . . . . . IN
<PAGE>
CUSIP NO. - 233230 10 1
(1) Name of reporting person. . . . . . . . . . R. James Straus
S.S. or I.R.S. No. of
above person. . . . . . . . . . . . . . . ###-##-####
(2) Check the appropriate box
if a member of a group
(see instructions). . . . . . . . . . . . (a)
(b) X
(3) SEC use only. . . . . . . . . . . . . . .
(4) Source of funds (see instructions). . . . PF
(5) Check box if disclosure
of legal proceedings is
required pursuant to
Items 2(d) or 2(e). . . . . . . . . . . .
(6) Citizenship or place
of organization . . . . . . . . . . . . . U.S.
Number of shares beneficially
owned by each reporting person
with:
(7) Sole voting power. . . . . . . . . . . . . 0
(8) Shared voting power. . . . . . . . . . . . 31,283
(9) Sole dispositive power . . . . . . . . . . 0
(10) Shared dispositive power . . . . . . . . . 31,283
(11) Aggregate amount beneficially
owned by each reporting person . . . . . . 82,685
(12) Check box if the aggregate amount
in Row (11) excludes certain
shares (see instructions). . . . . . . . .
(13) Percent of class represented
by amount in Row (11). . . . . . . . . . . 1.0%
(14) Type of reporting person . . . . . . . . . IN
<PAGE>
CUSIP NO. - 233230 10 1
(1) Name of reporting person. . . . . . . . . . Scott W. Dolson
S.S. or I.R.S. No. of
above person. . . . . . . . . . . . . . . ###-##-####
(2) Check the appropriate box
if a member of a group
(see instructions). . . . . . . . . . . . (a)
(b) X
(3) SEC use only. . . . . . . . . . . . . . .
(4) Source of funds (see instructions). . . . PF
(5) Check box if disclosure
of legal proceedings is
required pursuant to
Items 2(d) or 2(e). . . . . . . . . . . .
(6) Citizenship or place
of organization . . . . . . . . . . . . . U.S.
Number of shares beneficially
owned by each reporting person
with:
(7) Sole voting power. . . . . . . . . . . . . 0
(8) Shared voting power. . . . . . . . . . . . 20,855
(9) Sole dispositive power . . . . . . . . . . 0
(10) Shared dispositive power . . . . . . . . . 20,855
(11) Aggregate amount beneficially
owned by each reporting person . . . . . . 20,855
(12) Check box if the aggregate amount
in Row (11) excludes certain
shares (see instructions). . . . . . . . .
(13) Percent of class represented
by amount in Row (11). . . . . . . . . . . 0.7%
(14) Type of reporting person . . . . . . . . . IN
<PAGE>
CUSIP NO. - 233230 10 1
(1) Name of reporting person. . . . . . . . . . James A. Giesel
S.S. or I.R.S. No. of
above person. . . . . . . . . . . . . . . ###-##-####
(2) Check the appropriate box
if a member of a group
(see instructions). . . . . . . . . . . . (a)
(b) X
(3) SEC use only. . . . . . . . . . . . . . .
(4) Source of funds (see instructions). . . . PF
(5) Check box if disclosure
of legal proceedings is
required pursuant to
Items 2(d) or 2(e). . . . . . . . . . . .
(6) Citizenship or place
of organization . . . . . . . . . . . . . U.S.
Number of shares beneficially
owned by each reporting person
with:
(7) Sole voting power. . . . . . . . . . . . . 0
(8) Shared voting power. . . . . . . . . . . . 13,904
(9) Sole dispositive power . . . . . . . . . . 0
(10) Shared dispositive power . . . . . . . . . 13,904
(11) Aggregate amount beneficially
owned by each reporting person . . . . . . 13,904
(12) Check box if the aggregate amount
in Row (11) excludes certain
shares (see instructions). . . . . . . . .
(13) Percent of class represented
by amount in Row (11). . . . . . . . . . . 0.5%
(14) Type of reporting person . . . . . . . . . IN
<PAGE>
CUSIP NO. - 233230 10 1
(1) Name of reporting person. . . . . . . . . . Mark R. Feather
S.S. or I.R.S. No. of
above person. . . . . . . . . . . . . . . ###-##-####
(2) Check the appropriate box
if a member of a group
(see instructions). . . . . . . . . . . . (a)
(b) X
(3) SEC use only. . . . . . . . . . . . . . .
(4) Source of funds (see instructions). . . . PF
(5) Check box if disclosure
of legal proceedings is
required pursuant to
Items 2(d) or 2(e). . . . . . . . . . . .
(6) Citizenship or place
of organization . . . . . . . . . . . . . U.S.
Number of shares beneficially
owned by each reporting person
with:
(7) Sole voting power. . . . . . . . . . . . . 0
(8) Shared voting power. . . . . . . . . . . . 13,904
(9) Sole dispositive power . . . . . . . . . . 0
(10) Shared dispositive power . . . . . . . . . 13,904
(11) Aggregate amount beneficially
owned by each reporting person . . . . . . 13,904
(12) Check box if the aggregate amount
in Row (11) excludes certain
shares (see instructions). . . . . . . . .
(13) Percent of class represented
by amount in Row (11). . . . . . . . . . . 0.5%
(14) Type of reporting person . . . . . . . . . IN
<PAGE>
CUSIP NO. - 233230 10 1
(1) Name of reporting person. . . . . . . . . . Arthur S. Beeman
S.S. or I.R.S. No. of
above person. . . . . . . . . . . . . . . ###-##-####
(2) Check the appropriate box
if a member of a group
(see instructions). . . . . . . . . . . . (a)
(b) X
(3) SEC use only. . . . . . . . . . . . . . .
(4) Source of funds (see instructions). . . . PF
(5) Check box if disclosure
of legal proceedings is
required pursuant to
Items 2(d) or 2(e). . . . . . . . . . . .
(6) Citizenship or place
of organization . . . . . . . . . . . . . U.S.
Number of shares beneficially
owned by each reporting person
with:
(7) Sole voting power. . . . . . . . . . . . . 0
(8) Shared voting power. . . . . . . . . . . . 13,904
(9) Sole dispositive power . . . . . . . . . . 0
(10) Shared dispositive power . . . . . . . . . 13,904
(11) Aggregate amount beneficially
owned by each reporting person . . . . . . 13,904
(12) Check box if the aggregate amount
in Row (11) excludes certain
shares (see instructions). . . . . . . . .
(13) Percent of class represented
by amount in Row (11). . . . . . . . . . . 0.5%
(14) Type of reporting person . . . . . . . . . IN
<PAGE>
CUSIP NO. - 233230 10 1
(1) Name of reporting person. . . . . . . . . . Alan K. MacDonald
S.S. or I.R.S. No. of
above person. . . . . . . . . . . . . . . ###-##-####
(2) Check the appropriate box
if a member of a group
(see instructions). . . . . . . . . . . . (a)
(b) X
(3) SEC use only. . . . . . . . . . . . . . .
(4) Source of funds (see instructions). . . . PF
(5) Check box if disclosure
of legal proceedings is
required pursuant to
Items 2(d) or 2(e). . . . . . . . . . . .
(6) Citizenship or place
of organization . . . . . . . . . . . . . U.S.
Number of shares beneficially
owned by each reporting person
with:
(7) Sole voting power. . . . . . . . . . . . . 0
(8) Shared voting power. . . . . . . . . . . . 10,429
(9) Sole dispositive power . . . . . . . . . . 0
(10) Shared dispositive power . . . . . . . . . 10,429
(11) Aggregate amount beneficially
owned by each reporting person . . . . . . 10,429
(12) Check box if the aggregate amount
in Row (11) excludes certain
shares (see instructions). . . . . . . . .
(13) Percent of class represented
by amount in Row (11). . . . . . . . . . . 0.3%
(14) Type of reporting person . . . . . . . . . IN
<PAGE>
Item 1. Security and Issuer.
The class of equity securities to which this statement relates
is the common stock, $.10 par value (the "Common Stock"), of DMI
Furniture, Inc., a Delaware corporation (the "Issuer").
The Issuer's principal executive office is located at One
Oxmoor Place, 101 Bullitt Lane, Louisville, Kentucky 40202
Item 2. Identity and Background.
1. Donald D. Dreher
(a) Name: Donald D. Dreher
(b) Business Address: DMI Furniture, Inc.
One Oxmoor Place
101 Bullitt Lane
Louisville, Kentucky 40222
(c) Principal Occupation: Chairman, President and Chief
Executive Officer of the Issuer.
(d) During the last five years, Mr. Dreher has not been
convicted in a criminal proceeding.
(e) During the last five years, Mr. Dreher was not a
party to a civil proceeding of a judicial or
administrative body resulting in a judgment, decree
or final order enjoining future violations of, or
prohibiting or mandating activities subject to,
federal or state securities laws or finding any
violation with respect to such law.
(f) Mr. Dreher is a United States citizen.
2. Joseph G. Hill
(a) Name: Joseph G. Hill
(b) Business Address: DMI Furniture, Inc.
One Oxmoor Place
101 Bullitt Lane
Louisville, Kentucky 40222
(c) Principal Occupation: Vice President-Finance, Chief
Financial Officer, Secretary and Treasurer of the
Issuer.
(d) During the last five years, Mr. Hill has not been
convicted in a criminal proceeding.
<PAGE>
(e) During the last five years, Mr. Hill was not a
party to a civil proceeding of a judicial or
administrative body resulting in a judgment, decree
or final order enjoining future violations of, or
prohibiting or mandating activities subject to,
federal or state securities laws or finding any
violation with respect to such law.
(f) Mr. Hill is a United States citizen.
3. Pattco, Inc.
(a) Name: Pattco, Inc.
(b) State of Incorporation: Kentucky
(c) Principal Business: Venture capital and management
services.
(d) Business Address: 10000 Shelbyville Road
Suite 100
Louisville, KY 40223
(e) Principal Office: 10000 Shelbyville Road
Suite 100
Louisville, KY 40223
(f) During the last five years, Pattco, Inc. has not
been convicted in a criminal proceeding.
(g) During the last five years, Pattco, Inc. was not a
party to a civil proceeding of a judicial or
administrative body resulting in a judgment, decree
or final order enjoining future violations of, or
prohibiting or mandating activities subject to,
federal or state securities laws or finding any
violation with respect to such law.
4. James A. Patterson
(a) Name: James A. Patterson
(b) Business Address: Pattco, Inc.
10000 Shelbyville Road
Suite 100
Louisville, KY 40223
(c) Principal Occupation: Chairman and President of
Pattco, Inc.
(d) During the last five years, Mr. Patterson has not
been convicted in a criminal proceeding.
<PAGE>
(e) During the last five years, Mr. Patterson was not a
party to a civil proceeding of a judicial or
administrative body resulting in a judgment, decree
or final order enjoining future violations of, or
prohibiting or mandating activities subject to,
federal or state securities laws or finding any
violation with respect to such law.
(f) Mr. Patterson is a United States citizen.
5. C. Edward Glasscock
(a) Name: C. Edward Glasscock
(b) Business Address: Brown, Todd & Heyburn PLLC
3200 Providian Center
Louisville, Kentucky 40202-3363
(c) Principal Occupation: Attorney; Chairman of Brown,
Todd & Heyburn PLLC, a law firm.
(d) During the last five years, Mr. Glasscock has not
been convicted in a criminal proceeding.
(e) During the last five years, Mr. Glasscock was not a
party to a civil proceeding of a judicial or
administrative body resulting in a judgment, decree
or final order enjoining future violations of, or
prohibiting or mandating activities subject to,
federal or state securities laws or finding any
violation with respect to such law.
(f) Mr. Glasscock is a United States citizen.
6. Charles S. Cassis
(a) Name: Charles S. Cassis
(b) Business Address: Brown, Todd & Heyburn PLLC
3200 Providian Center
Louisville, Kentucky 40202-3363
(c) Principal Occupation: Attorney; Brown, Todd & Heyburn PLLC.
(d) During the last five years, Mr. Cassis has not
been convicted in a criminal proceeding.
(e) During the last five years, Mr. Cassis was not a
party to a civil proceeding of a judicial or
administrative body resulting in a judgment, decree
or final order enjoining future violations of, or
prohibiting or mandating activities subject to,
federal or state securities laws or finding any
violation with respect to such law.
(f) Mr. Cassis is a United States citizen.
<PAGE>
7. R. James Straus
(a) Name: R. James Straus
(b) Business Address: Brown, Todd & Heyburn PLLC
3200 Providian Center
Louisville, Kentucky 40202-3363
(c) Principal Occupation: Attorney; Brown, Todd & Heyburn PLLC.
(d) During the last five years, Mr. Straus has not
been convicted in a criminal proceeding.
(e) During the last five years, Mr. Straus was not a
party to a civil proceeding of a judicial or
administrative body resulting in a judgment, decree
or final order enjoining future violations of, or
prohibiting or mandating activities subject to,
federal or state securities laws or finding any
violation with respect to such law.
(f) Mr. Straus is a United States citizen.
8. Scott W. Dolson
(a) Name: Scott W. Dolson
(b) Business Address: Brown, Todd & Heyburn PLLC
3200 Providian Center
Louisville, Kentucky 40202-3363
(c) Principal Occupation: Attorney; Brown, Todd & Heyburn PLLC.
(d) During the last five years, Mr. Dolson has not
been convicted in a criminal proceeding.
(e) During the last five years, Mr. Dolson was not a
party to a civil proceeding of a judicial or
administrative body resulting in a judgment, decree
or final order enjoining future violations of, or
prohibiting or mandating activities subject to,
federal or state securities laws or finding any
violation with respect to such law.
(f) Mr. Dolson is a United States citizen.
9. James A. Giesel
(a) Name: James A. Giesel
(b) Business Address: Brown, Todd & Heyburn PLLC
3200 Providian Center
Louisville, Kentucky 40202-3363
(c) Principal Occupation: Attorney; Brown, Todd & Heyburn PLLC.
(d) During the last five years, Mr. Giesel has not
been convicted in a criminal proceeding.
<PAGE>
(e) During the last five years, Mr. Giesel was not a
party to a civil proceeding of a judicial or
administrative body resulting in a judgment, decree
or final order enjoining future violations of, or
prohibiting or mandating activities subject to,
federal or state securities laws or finding any
violation with respect to such law.
(f) Mr. Giesel is a United States citizen.
10. Mark R. Feather
(a) Name: Mark R. Feather
(b) Business Address: Brown, Todd & Heyburn PLLC
3200 Providian Center
Louisville, Kentucky 40202-3363
(c) Principal Occupation: Attorney; Brown, Todd & Heyburn PLLC.
(d) During the last five years, Mr. Feather has not
been convicted in a criminal proceeding.
(e) During the last five years, Mr. Feather was not a
party to a civil proceeding of a judicial or
administrative body resulting in a judgment, decree
or final order enjoining future violations of, or
prohibiting or mandating activities subject to,
federal or state securities laws or finding any
violation with respect to such law.
(f) Mr. Feather is a United States citizen.
11. Arthur S. Beeman
(a) Name: Arthur S. Beeman
(b) Business Address: Brown, Todd & Heyburn PLLC
3200 Providian Center
Louisville, Kentucky 40202-3363
(c) Principal Occupation: Attorney; Brown, Todd & Heyburn PLLC.
Prior to December 1995, Mr. Beeman practiced with the law firm
of Robins, Kaplan, Miller & Ciresi, 2800 LaSalle Plaza, 800
LaSalle Avenue, Minneapolis, Minnesota 55402.
(d) During the last five years, Mr. Beeman has not
been convicted in a criminal proceeding.
(e) During the last five years, Mr. Beeman was not a
party to a civil proceeding of a judicial or
administrative body resulting in a judgment, decree
or final order enjoining future violations of, or
prohibiting or mandating activities subject to,
federal or state securities laws or finding any
violation with respect to such law.
(f) Mr. Beeman is a United States citizen.
<PAGE>
12. Alan K. MacDonald
(a) Name: Alan K. MacDonald
(b) Business Address: Brown, Todd & Heyburn PLLC
3200 Providian Center
Louisville, Kentucky 40202-3363
(c) Principal Occupation: Attorney; Brown, Todd & Heyburn PLLC.
(d) During the last five years, Mr. MacDonald has not
been convicted in a criminal proceeding.
(e) During the last five years, Mr. MacDonald was not a
party to a civil proceeding of a judicial or
administrative body resulting in a judgment, decree
or final order enjoining future violations of, or
prohibiting or mandating activities subject to,
federal or state securities laws or finding any
violation with respect to such law.
(f) Mr. MacDonald is a United States citizen.
Item 3. Sources and Amount of Funds or Other Consideration.
On August 2, 1996, Donald D. Dreher, Joseph G. Hill, Pattco,
Inc., C. Edward Glasscock, Charles S. Cassis, R. James Straus,
Scott W. Dolson, James A. Giesel, Mark R. Feather, Arthur S.
Beeman, and Alan K. MacDonald (the "Investor Group") completed the
purchase of 1,048,930 shares of the Issuer's Series C Preferred
Stock, par value $2.00 per share ("Preferred Shares") and 280,169
shares of the Issuer's Common Stock, par value $.10 per share
("Common Shares") from BT Capital Partners, Inc. for an aggregate
purchase price of $1.6 million.
On August 1, 1996, the Investor Group purchased 25,030
Preferred Shares and 5,503 Common Shares from Bank One, Kentucky,
NA for an aggregate purchase price of $36,110.20.
On August 7, 1996, the Investor Group purchased 383,026
Preferred Shares and 131,858 Common Shares from Chase Venture
Capital Associates, L.P. for an aggregate purchase price of
$552,479.02.
The individual members of the Investor Group financed their
purchases of Preferred and Common Shares with personal funds, bank
loans, and working capital. See Item 5 for information concerning
the financing arrangements of individual members of the Investor
Group.
<PAGE>
Item 4. Purpose of Transaction.
Donald D. Dreher and Joseph G. Hill, two of the four members
of the Investor Group, are currently two of the five members of the
Issuer's Board of Directors. Mr. Dreher is the Issuer's Chairman,
President and Chief Executive Officer, and Mr. Hill is the Issuer's
Vice-President-Finance, Chief Financial Officer, Secretary, and
Treasurer. In addition, the Preferred Shares purchased by the Investor
Group represent 73.0% of the outstanding Preferred Shares. Holders of
Preferred Shares are entitled to elect up to two additional directors
to the Issuer's Board, a right that the Issuer's Preferred Shareholders
currently have not elected to exercise. The Investor Group expects, by
virtue of its acquisition of a majority of the Preferred Shares, to exercise
the right of the Preferred Shareholders to elect two additional directors to
the Issuer's Board of Directors, which would result in members of the
Investor Group and their representatives holding four positions on a
seven-member board of directors of the Issuer. Therefore, the members of
the Investor Group would be in a position to exert significant influence
over the conduct of the Issuer's business.
The 1,456,986 Preferred Shares acquired by the Investor Group are
convertible into a total of 1,807,061 Common Shares. The Investor Group also
acquired a total of 417,530 Common Shares. Together with the 97,246 Common
Shares and the currently exercisable employee stock options to purchase
603,061 Common Shares currently owned by members of the Investor Group, the
Investor Group beneficially own a total of 2,924,828 shares or 54.0% of the
Common Shares.
In the future, members of the Investor Group may purchase additional
Preferred Shares or Common Shares in open market or privately negotiated
transactions, although none of them has any immediate plans to do so.
Whether a member of the Investor Group purchases additional Preferred or
Common Shares will depend on the member's continuing assessment of pertinent
factors, including without limitation the availability of Preferred or
Common Shares for purchase at particular price levels, stock market and
money market conditions, economic conditions in general, and the condition
of the furniture inudstry and the Issuer in particular.
Except as indicated above or as may be currently under
consideration by the Issuer's board of directors, members of the
Management Group have no current plans or proposals that relate to
or would result in: (i) the acquisition by any person of additional
securities of the Issuer, or the disposition of securities of the
Issuer, (ii) an extraordinary corporate transaction, such as a
merger, reorganization or liquidation involving the Issuer or any
of its subsidiaries, (iii) a sale or transfer of a material amount
of assets of the Issuer or any of its subsidiaries, (iv) any change
in the present board of directors or management of the Issuer,
including any plans or proposals to change the number or term of
directors or to fill any existing vacancies on the board, (v) any
material change in the present capitalization or dividend policy of
the Issuer, (vi) any other material change in the Issuer's business
or corporate structure, (vii) changes in the Issuer's charter,
bylaws or instruments corresponding thereto or other actions which
may impede the acquisition of control of the Issuer by any person,
(viii) causing a class of securities of the Issuer to be delisted
from a national securities exchange or cease to be authorized to be
<PAGE>
quoted in an inter-dealer quotation system of a registered national
securities association, (ix) a class of equity securities of the
Issuer becoming eligible for termination of registration pursuant
to Section 12(g)(4) of the Securities Exchange Act of 1934, or (x)
any action similar to any of those enumerated above.
Item 5. Interest in Securities of the Issuer.
Members of the Investor Group beneficially own (i) 514,776 currently
outstanding Common Shares, (ii) currently exerciseable employee stock options
to purchase 603,061 Common Shares, and (iii) 1,456,986 shares of Preferred
Stock convertible into 1,807,061 Common Shares, or a total of 2,924,898
shares or 43.8% of the Common Shares.
Information concerning the beneficial ownership of the individual
members of the Investor Group is set forth in the following paragraphs.
Except for the purchases of Preferred and Common Shares described in Item 3
above, none of the members of the Investor Group has engaged in any
transactions in the Common Shares or securities convertible into the Common
Shares during the past sixty days.
Donald D. Dreher owns 143,519 Common Shares, options to purchase 445,093
Common Shares granted under the Issuer's employee benefit plans, and 45,531
Preferred Shares convertible into 56,471 Common Shares. Mr. Dreher has sole
voting and dispositive power with respect to these shares. Mr. Dreher is the
beneficial owner of a total of 588,612 shares or 16.9% of the Common Shares.
Mr. Dreher purchased Preferred and Common Shares referenced in Item 3 with
personal funds.
Joseph G. Hill owns 18,246 Common Shares, currently exerciseable options
to purchase 157,968 Common Shares granted under the Issuer's employee benefit
plans, and 45,531 Preferred Shares convertible into 56,471 Common Shares. Mr.
Hill has sole voting and dispositive power with respect to these shares. Mr.
Hill is the beneficial owner of 245,773 shares or 7.7% of the Common Shares.
Mr. Hill purchased Preferred and Common Shares in the transactions referenced
in Item 3 using personal funds.
Pattco, Inc. owns 260,956 Common Shares and 910,616 Preferred Shares
convertible into 1,129,413 Common Shares with respect to which Pattco, Inc.
has sole voting and dispositive power. Pattco, Inc. is the beneficial owner
of a total of 1,390,369 shares or 33.7% of the Common Shares. Pattco
purchased Preferred and Common Shares in the transactions referenced in Item
3 using working capital. James A. Patterson may be deemed to be the
beneficial owner of the shares owned by Pattco, Inc. by virtue of Mr.
Patterson's ownership of a controlling interest in Pattco, Inc.
<PAGE>
C. Edward Glasscock owns 100,387 Common Shares and 332,858 Preferred
Shares convertible into 412,836 Common Shares with respect to which he has
sole voting and dispositive power. Mr. Glasscock is the beneficial owner of
513,223 shares or 15.0% of the Common Shares. Mr. Glasscock used personal
funds and the proceeds of a $250,000 bank loan to purchase Preferred and
Common Shares in the transactions referenced in Item 3. Mr. Glasscock pledged
the Preferred and Common Shares acquired by him as collateral for the loan
which was made in the ordinary course of the lender's banking business.
Charles S. Cassis owns 15,519 Common Shares and 54,154 Preferred Shares
convertible into 67,166 Common Shares with respect to which he has sole voting
and dispositive power. Mr. Cassis is the benefical owner of 82,685 shares or
2.7% of the Common Shares. Mr. Cassis purchased Preferred and Common Stock in
the transactions referenced in Item 3 using personal funds.
R. James Straus owns 5,871 Common Shares and 20,489 Preferred Shares
convertible into 25,412 Common Shares with respect to which he has sole
voting and dispositive power. Mr. Straus is the beneficial owner of 31,283
shares or 1.0% of the Common Shares. Mr. Straus purchased Preferred and
Common Stock in the transactions referenced in Item 3 using personal funds.
Scott W. Dolson owns 3,914 Common Shares and 13,659 Preferred Shares
convertible into 16,941 Common Shares with respect to which he has sole
voting and dispostive power. Mr. Dolson is the beneficial owner of 20,855
shares or 0.7% of the Common Shares. Mr. Dolson purchased Preferred and
Common Stock in the transactions referenced in Item 3 using personal funds.
James A. Giesel owns 3,610 Common Shares and 9,106 Preferred Shares
convertible into 11,294 Common Shares with respect to which he has sole
voting and dispositive power. Mr. Giesel is the beneficial owner of 13,904
shares or 0.5% of the Common Shares. Mr. Giesel purchased Preferred and
Common Stock in the transactions referenced in Item 3 using personal funds.
Mark R. Feather owns 3,610 Common Shares and 9,106 Preferred Shares
convertible into 11,294 Common Shares with respect to which he has sole
voting and dispositive power. Mr. Feather is the beneficial owner of 13,904
shares or 0.5% of the Common Shares. Mr. Feather purchased Preferred and
Common Stock in the transactions referenced in Item 3 using personal funds.
Arthur S. Beeman owns 3,610 Common Stock and 9,106 Preferred Shares
convertible into 11,294 Common Shares with respect to which he has sole
voting and dispositive power. Mr. Beeman is the beneficial owner of 13,904
shares or 0.5% of the Common Shares. Mr. Beeman is the beneficial owner of
13,904 shares or 0.5% of the Common Shares. Mr. Beeman purchased Preferred
and Common Stock in the transactions referenced in Item 3 using personal
funds.
Alan K. MacDonald owns 1,957 Common Shares and 6,830 Preferred Shares
convertible into 8,472 Common Shares with respect to which he has sole
voting and dispositive power. Mr. MacDonald is the beneficial owner of
10,429 shares or 0.3% of the Common Shares. Mr. MacDonald is the beneficial
owner of 13,904 shares or 0.5% of the Common Shares. Mr. MacDonald purchased
Preferred and Common Stock in the transactions referenced in Item 3 using
personal funds.
<PAGE>
Item 6. Contracts, Arrangements, Understandings or Relationships
with Respect to Securities of the Issuer.
Mr. Dreher has entered into an employment agreement with the Issuer for
the period January 1, 1996 through December 31, 1998, pursuant to which Mr.
Dreher serves as Chairman, President and Chief Executive Officer at an
annual salary of $275,000 which is reviewed annually. In addition, Mr.
Dreher can earn a bonus with respect to each year of his employment payable
in newly issued Common Shares having a market value equal to 59.3% of any
cash bonus for such year earned by Mr. Dreher pursuant to the formula
contained in his employment agreement.
Mr. Hill has entered into an employment agreement with the Issuer for
the period April 1, 1995 through March 31, 1997, pursuant to which he
serves as Vice-President-Finance, Chief Financial Officer of the Issuer
at an initial annual salary of $155,000 which is reviewed annually. In
addition, Mr. Hill can earn a bonus with respect to each year of his
employment payable in newly issued Common Shares having a market value equal
to 45.45% of the bonuses earned by Mr. Hill for such year pursuant to the
formula contained in his employment agreement, up to a maximum of 25% of
weighted average base salary.
Mr. Dreher and Mr. Hill each have entered into a severance
agreement with the Issuer, which have been automatically renewed
through December 31, 2000. The severance agreements provide, among
other things, for the payment of certain compensation to them
following termination of employment other than for cause after a
change in control of the Issuer. These severance agreements are
described in greater detail on pages 11 and 12 of the Issuer's
Definitive Proxy Statement dated December 29, 1995, the applicable
portions of which are incorporated herein by reference.
Item 7. Material to be Filed as Exhibits.
Exhibit 99.1 Agreement to File as a Group
Exhibit 99.2 Employment Agreement with Donald D. Dreher
is incorporated by reference to Exhibit 10.1 to the Issuer's
Current Report on Form 8-K dated April 22, 1996 (the "April 1996 8-K").
Exhibit 99.3 Employment Agreement with Joseph G. Hill is
incorporated by reference to Exhibit 10.2 to the April 1996 8-K.
Exhibit 99.4 Severance Agreement with Donald D. Dreher
is incorporated by reference to the Issuer's 1993 10-K.
Exhibit 99.5 Severance Agreement with Joseph G. Hill is
incorporated by reference to the Issuer's 1993 10-K.
Exhibit 99.6 Promissory Note and Commercial Security Agreement.
<PAGE>
SIGNATURES
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement
is true, complete and correct.
/s/Donald D. Dreher
Date: August 7, 1996
/s/Joseph G. Hill
Date: August 7, 1996
PATTCO, INC.
By /s/ James A Patterson, Chairman
and President
Date: August 7, 1996
/s/James A. Patterson
Date: August 7, 1996
/s/ C. Edward Glasscock
Date: August 7, 1996
/s/ Charles S. Cassis
Date: August 7, 1996
/s/ R. James Straus
Date: August 7, 1996
/s/ Scott W. Dolson
Date: August 7, 1996
/s/ James A. Giesel
Date: August 7, 1996
/s/ Mark R. Feather
Date: August 7, 1996
/s/ Arthur S. Beeman
Date: August 7, 1996
/s/Alan K. MacDonald
Date: August 7, 1996
<PAGE>
EXHIBIT 99.1
Agreement to File as a Group
In accordance with Rule 13d-f promulgated under the Securities
Exchange Act of 1934, as amended, the persons below certify that
they have agreed and hereby memorialize their agreement to the
joint filing on behalf of each of them of a Statement on Schedule
13D (including amendments thereto) with respect to the common stock
of DMI Furniture, Inc. This Joint Filing Statement shall be
included as an exhibit to such joint filing.
Each person on whose behalf the Schedule 13D or any amendment
thereto is filed is responsible for the timely filing of such
Schedule 13D and any amendments thereto necessitated by the actions
or intentions of such person and for the completeness and accuracy
of the information pertaining to him or its or his or its actions
or intentions.
/s/Donald D. Dreher
Date: August 7, 1996
/s/Joseph G. Hill
Date: August 7, 1996
PATTCO, INC.
By /s/ James A Patterson, Chairman
and President
Date: August 7, 1996
/s/James A. Patterson
Date: August 7, 1996
/s/ C. Edward Glasscock
Date: August 7, 1996
/s/ Charles S. Cassis
Date: August 7, 1996
/s/ R. James Straus
Date: August 7, 1996
/s/ Scott W. Dolson
Date: August 7, 1996
/s/ James A. Giesel
Date: August 7, 1996
/s/ Mark R. Feather
Date: August 7, 1996
/s/ Arthur S. Beeman
Date: August 7, 1996
/s/Alan K. MacDonald
Date: August 7, 1996
EXHIBIT 99.6
[NAME, ADDRESS and PHONE NUMBER OF BANK OMITTED]
"LENDER"
BORROWER COMMERCIAL
VARIABLE RATE
C. Edward Glasscock PROMISSORY
NOTE
ADDRESS
3200 Providian Center
Louisville, KY 40202-3363
Telephone No. Identification No.
(502)568-0230 ###-##-####
Principal
Interest Amount/Credit Funding Maturity Customer Loan
Rate Limit Date Date No. No.
VARIABLE $250,000.00 7/31/96 7/30/97 F/S 1442562
5-15-96
Purchase of DMI Furniture, Inc. Stock
PROMISE TO PAY: For value received, Borrower promises to pay to
the order of Lender the principal amount of Two Hundred Fifty
Thousand and No/100 Dollars ($250,000.00) plus interest on the
unpaid principal balance at the rate and in the manner described
below, until all amounts owing under this Note are paid in full.
All amounts received by Lender shall be applied first to accrued,
unpaid interest, then to unpaid principal, and then to any late
charges or expenses.
INTEREST RATE: This Note has a variable interest rate feature.
The interest rate on this Note may change from time to time if the
Index Rate identified below changes. Interest shall be computed on
the basis of the actual number of days over 365 per year, interest
on this Note shall be calculated and payable at a variable rate
equal to 1.500% per annum over the Index Rate. The initial Index
Rate is 8.250% per annum. The initial interest rate on this Note
shall be 9.750% per annum. Any change in the interest rate
resulting from a change in the Index Rate will be effective on:
THE DATE THE INDEX RATE CHANGES
INDEX RATE: The Index Rate for this Note shall be:
NEW YORK PRIME AS PUBLISHED IN THE WALL STREET JOURNAL
If the Index Rate is redefined or becomes unavailable then Lender
may select another index which is substantially similar.
MINIMUM RATE/MAXIMUM RATE: Subject to applicable law, the minimum
interest rate on this Note shall be n/a % per annum, or if
less, or if a maximum rate is not indicated, the maximum interest
rate Lender is permitted to charge by law.
RATE ADJUSTMENT LIMITATIONS: The maximum rate increase at any one
time will be n/a %. The maximum rate decrease at any one
time will be n/a %.
DEFAULT RATE: In the event of any default under this Note, the
Lender may, in its discretion, increase the interest rate on this
Note to: n/a
, or the maximum interest rate Lender
is permitted to charge by law, whichever is less.
PAYMENT SCHEDULE: Borrower shall pay the principal and interest
according to the following schedule:
ON DEMAND, BUT UNTIL DEMAND IS MADE, THEN:
A single payment of the unpaid principal balance plus
accrued interest is
due and payable on July 30, 1997.
PREPAYMENT: This Note may be prepaid in part or in full on or
before its maturity date. If this Note contains more than one
installment, any partial prepayment will not affect the due date or
the amount of any subsequent installment, unless agreed to, in
writing, by Borrower and Lender. If this Note is prepaid in full,
there will be: X No minimum finance charge or prepayment penalty.
__ A minimum finance charge of $ . __ A prepayment
penalty of: .
LATE CHARGE: If a payment is received more than n/a days late,
Borrower will be charged a late charge of: __
% of the unpaid payment; ___ $
or % of the unpaid payment,
whichever is __ greater __ less.
SECURITY: To secure the payment and performance of obligations
incurred under this Note grants Lender a security interest in all
of Borrower's right, title and interest in all monies, instruments,
savings, checking and other accounts of Borrower (excluding IRA,
Keough and trust accounts and other accounts subject to tax
penalties (if so assigned) that are now or in the future in Lenders
custody or control. "X" If checked, the obligations under this
Note are also secured by a lien on and/or security interest in the
property described in the security instruments executed in
connection with this Note as well as any other property designated
as security for this Note now or in the future.
Pledge of 327,139 shares and 5,719 shares of Series C
preferred stock of DMI Furniture,
Inc., and 95,387 shares of common stock of DMI Furniture, Inc.
RENEWAL: __ If checked, this Note is a renewal, but not a
satisfaction, of Loan Number .
THE PERSONS SIGNING BELOW ACKNOWLEDGE THAT THEY HAVE READ,
UNDERSTAND, AND AGREE TO THE TERMS AND CONDITIONS OF THIS NOTE,
INCLUDING THE PROVISIONS ON THE REVERSE SIDE, AND FURTHER
ACKNOWLEDGE RECEIPT OF AN EXACT COPY OF THIS NOTE.
Dated: July 31, 1996
BORROWER: C. Edward Glasscock
/s/ C. Edward Glasscock
C. Edward Glasscock
TERMS AND CONDITIONS
1. DEFAULT. Borrower will be in default under this Note in the
event that Borrower, any guarantor or any other third party
pledging collateral to secure this Note:
(a) fails to make any payment on this Note or any other
indebtedness to Lender when due;
(b) fails to perform any obligation or breaches any warranty
or covenant to Lender contained in this Note, any
security instrument, or any other present or future
written agreement regarding this or any other
indebtedness of Borrower to Lender;
(c) provides or causes any false or misleading signature or
representation to be provided to Lender;
(d) sells, conveys, or transfers rights in any collateral
securing this Note without the written approval of
Lender; or destroys, loses or damages such collateral in
any material respect; or subjects such collateral to
seizure, confiscation or condemnation;
(e) has a garnishment, judgment, tax levy, attachment or lien
entered or served against Borrower, any guarantor, or any
third party pledging collateral to secure this Note or
any of their property;
(f) dies, becomes legally incompetent, is dissolved or
terminated, ceases to operate its business, becomes
insolvent, makes an assignment for the benefit of
creditors, fails to pay debts as they become due, or
becomes the subject of any bankruptcy, insolvency or
debtor rehabilitation proceeding; or
(g) causes Lender to deem itself insecure due to a
significant decline in the value of any real or personal
property securing payment of this Note, or Lender in good
faith, believes the prospect of payment or performance is
impaired.
2. RIGHTS OF LENDER ON DEFAULT. If there is a default under this
Note, Lender will be entitled to exercise one or more of the
following remedies without notice or demand (except as required by
law):
(a) to declare the principal amount plus accrued interest
under this Note, and all other present and future
obligations of Borrower immediately due and payable in
full;
(b) to collect the outstanding obligations of Borrower with
or without resorting to judicial process;
(c) to cease making advances under this Note or any other
agreement between Borrower and Lender;
(d) to take possession of any collateral in any manner
permitted by law;
(e) to require Borrower to deliver and make available to
Lender any collateral at a place reasonably convenient to
Borrower and Lender;
(f) to sell, lease or otherwise dispose of any collateral and
collect any deficiency balance with or without resort to
legal process;
(g) to set-off Borrower's obligations against any amounts due
to Borrower including, but not limited to, monies,
instruments and deposit accounts maintained with Lender;
and
(h) to exercise all other rights available to Lender under
any other written agreement or applicable law.
Lender's rights are cumulative and may be exercised together,
separately, and in any order. Lender's remedies under this
paragraph are in addition to those available at common law,
including, but not limited to, the right of set-off.
3. DEMAND FEATURE. "X" If checked, this Note contains a demand
feature. Lender's right to demand payment, at any time, and from
time to time, shall be in Lender's sole and absolute discretion,
whether or not any default has occurred.
4. FINANCIAL INFORMATION. Borrower will at all times keep proper
books of record and account in which full, true and correct entries
shall be made in accordance with generally accepted accounting
principles and will deliver to Lender, within ninety (90) days
after the end of each fiscal year of Borrower, a copy of the annual
financial statements of Borrower relating to such fiscal year, such
statements to include (i) the balance sheet of Borrower as at the
end of such fiscal year and (ii) the related income statement,
statement of retained earnings and statement of changes in the
financial position of Borrower for such fiscal year, prepared by
such certified public accountants as may be reasonably satisfactory
to Lender. Borrower also agrees to deliver to Lender within
fifteen (15) days after filing same, a copy of Borrower's income
tax returns and also, from time to time, such other financial
information with respect to Borrower as Lender may request.
5. MODIFICATION AND WAIVER. The modification or waiver of any of
Borrower's obligations or Lender's rights under this Note must be
contained in a writing signed by Lender. Lender may perform any of
Borrower's obligations or delay or fail to exercise any of its
rights and without causing a waiver of those obligations or rights.
A waiver on one occasion will not constitute a waiver on any other
occasion. Borrower's obligations under this Note shall not be
affected if Lender amends, compromises, exchanges, fails to
exercise, impairs or releases any of the obligations belonging to
any co-borrower or guarantor or any of its rights against any
co-borrower, guarantor or collateral.
6. SEVERABILITY. If any provision of this Note is invalid,
illegal or unenforceable, the validity, legality, and
enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
7. ASSIGNMENT. Borrower agrees not to assign any of Borrower's
rights, remedies or obligations described in this Note without the
prior written consent of Lender, which consent may be withheld by
Lender in its sole discretion. Borrower agrees that Lender is
entitled to assign some or all of its rights and remedies described
in this Note without notice to or the prior consent of Borrower;
8. NOTICE. Any notice or other communication to be provided to
Borrower or Lender under this Note shall be in writing and sent to
the parties at the addresses described in this Note or such other
address as the parties may designate in writing from time to time.
9. APPLICABLE LAW. This Note shall be governed by the laws of the
state indicated in Lender's address. Unless applicable law
provides otherwise, Borrower consents to the jurisdiction of any
court located in such state selected by Lender, in its discretion,
in the event of any legal proceeding under this Note.
10. COLLECTION COSTS. To the extent permitted by law, Borrower
agrees to pay Lender's reasonable fees and costs, including, but
not limited to, fees and costs of attorneys and other agents
(including without limitation paralegals, clerks and consultants),
which are incurred by Lender in collecting any amount due or
enforcing any right or remedy under this Note, whether or not suit
is brought, including, but not limited to, all fees and costs
incurred on appeal, in bankruptcy, and for post-judgment collection
actions.
11. MISCELLANEOUS. This Note is being executed primarily for
commercial, agricultural, or business purposes. Borrower and
Lender agree that time is of the essence. Borrower agrees to make
all payments to Lender at any address designated by Lender and in
lawful United States currency. Borrower and any person who
endorses this Note waives presentment, demand for payment, notice
of dishonor and protest and further waives any right to require
Lender to proceed against anyone else before proceeding against
Borrower or said person. Al references to Borrower in this Note
shall include all of the parties signing this Note, and this Note
shall be binding upon the heirs, successors and assigns of Borrower
and Lender. if there is more than one Borrower their obligations
under this Note shall be joint and several. This Note represents
the complete and integrated understanding between Borrower and
Lender regarding the terms hereof.
12. JURY TRIAL WAIVER. LENDER AND BORROWER HEREBY WAIVE ANY
RIGHT TO A TRIAL BY JURY IN ANY CIVIL ACTION ARISING OUT OF, OR
BASED UPON, THIS NOTE OR THE COLLATERAL SECURING THIS NOTE.
13. ADDITIONAL TERMS:
See Stock Pledge Agreement dated 7-31-96
[NAME, ADDRESS and PHONE NUMBER OF BANK OMITTED]
"LENDER"
COMMERCIAL
SECURITY
AGREEMENT
BORROWER OWNER
C. Edward Glasscock C. Edward Glasscock
ADDRESS ADDRESS
3200 Providian Center 3200 Providian Center
Louisville, KY 40202-3363 Louisville, KY 40202-3363
TELEPHONE NO. ID NO. TELEPHONE NO. ID NO.
(502)568-0230 ###-##-#### (502)568-0230 ###-##-####
1. SECURITY INTEREST. For good and valuable consideration, Owner
grants to Lender identified above a continuing security interest in
the Collateral described below to secure the Obligations described
in this Agreement.
2. OBLIGATIONS. The collateral shall secure the payment and
performance of all of Borrower's and Owner's present and future,
joint and/or several, direct and indirect, absolute and contingent,
express and implied indebtedness to Lender under any promissory
note or agreement described below, including all future advances
made by Lender to Borrower or Owner and expenditures incurred by
Lender upon the occurrence of a default (collectively
"Obligations"):
a. this Agreement and/or the following promissory notes and
agreements:
Principal Funding/
Interest Amount/Credit Agreement Maturity Customer Loan
Rate Limit Date Date No. No.
VARIABLE $250,000.00 7/31/96 7/30/97 F/S 1442562
5-15-96
b. all other present or future, evidences of indebtedness,
agreements, instruments, guaranties or otherwise of
Borrower or Owner to Lender (whether incurred for the
same or different purposes than the foregoing); and
c. all renewals, extensions, amendments, modifications,
replacements or substitutions to any of the foregoing.
3. COLLATERAL. All of Owner's rights, title and interest in the
following described property whether now or hereafter existing or
now owned or hereafter acquired by Owner and wherever located shall
constitute the "Collateral;"
All accounts and contract rights including, but not
limited to, any accounts and contract rights described on
Schedule A attached hereto and incorporated herein by
this reference;
All chattel paper including, but not limited to, any
chattel paper described on Schedule A attached hereto and
incorporated herein by this reference;
All documents including, but not limited to, any
documents described on Schedule A attached hereto and
incorporated herein by this reference;
All equipment, including, but not limited to, any
equipment described on Schedule A attached hereto and
incorporated herein by this reference;
All fixtures, including, but not limited, any fixtures
described on Schedule A and located or to be located on
the real property described on Schedule B attached hereto
and incorporated herein by this reference;
All general intangibles including, but not limited to,
any general intangibles described on Schedule A attached
hereto and incorporated herein by this reference;
All instruments including, but not limited to, any
inventory described on Schedule A attached hereto and
incorporated herein by this reference;
All inventory including, but not limited to, any
inventory described on Schedule A attached hereto and
incorporated herein by this reference;
All minerals or the like and accounts resulting from
sales at the wellhead or minehead located on or related
to the real property described on Schedule B attached
hereto and incorporated herein by this reference;
All standing timber which is to be cut and removed under
a conveyance or contract for sale located on the real
property described on Schedule B attached hereto and
incorporated herein by this reference;
Other;
The property described on Schedule A;
All monies, instruments, and savings, checking or other accounts of
Owner (excluding IRA, Keogh, trust accounts, and other accounts
subject to tax penalties (if so assigned) that are now or in the
future in Lender's custody or control;
All monies or instruments pertaining to the Collateral described
above;
All accessions, accessories, additions, amendments, attachments,
modifications, replacements and substitutions to any of the above;
All proceeds and products of any of the above;
All policies of insurance pertaining to any of the above as well as
any proceeds and unearned premiums pertaining to such policies; and
All books, records, microfilm, microfiche, software, disks and
tapes pertaining to any of the above.
4. OWNER'S TAXPAYER IDENTIFICATION: Owner's social security
number or federal taxpayer identification number is ###-##-####.
5. RESIDENCY/LEGAL STATUS. X Owner is an individual and a resident
of the state of : KENTUCKY.
__ Owner is a ___________________________________________________
duly organized, validly existing and in good standing under the
laws of the state of: _________________________________________.
__ The address of the registered office of the corporation is:
__________________________________________________________________.
6. REPRESENTATIONS, WARRANTIES, AND COVENANTS. Owner represents,
warrants and covenants to Lender that:
(a) Owner is and shall remain the sole owner of the
Collateral;
(b) Neither Owner, nor, to the best of Owner's knowledge, has
any other party used, generated, released, discharged,
stored or disposed of any hazardous waste, toxic
substance, or related material (collectively "Hazardous
Materials") or transported any Hazardous Materials across
the property except as allowed by and in accordance with
applicable federal, state and local law and regulation.
Owner shall not commit or permit such actions to be taken
in the future. The term "Hazardous Materials" shall mean
any substance, material, or waste which is or becomes
regulated by any governmental authority including, but
not limited to, (i) petroleum; (ii) asbestos; (iii)
polychlorinated biphenyls; (iv) those substances,
materials or wastes designated as a "hazardous substance"
pursuant to Section 311 of the Clean Water Act or listed
pursuant to Section 307 of the Clean Water Act or any
amendments or replacements to these statutes; (v) those
substances, materials or wastes defined as a "hazardous
substance" pursuant to Section 101 of the Comprehensive
Environmental Response, Compensation and Liability Act,
or any amendments or replacements to that statute. Owner
is in compliance in all respects with all applicable
federal, state and local laws and regulations, including,
without limitation, those relating to "Hazardous
Materials," as defined herein, and other environmental
matters (the "Environmental Laws") and neither the
federal government nor any other governmental quasi
governmental entity has filed a lien on the Collateral,
nor are there any pending or threatened governmental,
judicial or administrative actions with respect to
environmental matters, which involve the Collateral;
(c) Owner's chief executive office, chief place of business,
office where its business records relating to the
Collateral and the Collateral is located, or residence is
the address identified above and has been such during the
four (4) month period prior to the date hereof. Owner's
other executive offices, places of business, locations of
its business records, or domiciles are described on
Schedule C attached hereto and incorporated herein by
this reference. Owner shall immediately advise Lender in
writing of any change in or addition to the foregoing
addresses;
(d) Owner shall not become a party to any restructuring of
its form of business or participate in any consolidation,
merger, liquidation or dissolution without Lender's prior
written consent;
(e) Owner shall notify Lender of the nature of any intended
change of Owner's name, or the use of any trade name, and
the effective date of such change;
(f) The Collateral is and shall at all times remain free of
all tax and other liens, security interests, encumbrances
and claims of any kind except for those belonging to
Lender and those described on Schedule D attached hereto
and incorporated herein by this reference. Without
waiving the event of default as a result thereof, Owner
shall take any action and execute any document needed to
discharge the foregoing liens, security interests,
encumbrances and claims;
(g) Owner shall defend the Collateral against all claims and
demands of all persons at any time claiming any interest
therein;
(h) All of the goods, fixtures, minerals or the like, and
standing timber constituting the Collateral is and shall
be located at Owner's location of any Collateral without
the prior written consent of Lender;
(i) Owner shall provide Lender with possession of all chattel
paper and instruments constituting the Collateral, and
Owner shall promptly mark all chattel paper, instruments,
and documents constituting the Collateral to show that
the same are subject to Lender's security interests;
(j) All of Owner's accounts or contract rights; chattel
paper; documents; general intangibles; instruments; and
federal, state, county, and municipal government and
other permits and licenses; trusts , liens, contracts,
leases, and agreements constituting the Collateral are
and shall be valid, genuine and legally enforceable
obligations and rights belonging to Owner against one or
more third parties and not subject to any claim, defense,
set-off or counterclaim of any kind;
(k) Owner shall not amend, modify, replace, or substitute any
account or contract right; chattel paper; document;
general intangible; or instrument constituting the
Collateral without the prior written of Lender;
(l) Owner has the right and is duly authorized to enter into
and perform its obligations under this Agreement.
Owner's execution and performance of these obligations do
not and shall not conflict with the provisions of any
statute, regulation, ordinance, rule of law, contract or
other agreement which may now or hereafter be binding on
Owner;
(m) No action or proceeding is pending against Owner which
might result in any material or adverse change in its
business operations or financial condition or materially
affect the Collateral;
(n) Owner has not violated and shall not violate any
applicable federal, state, county or municipal statute,
regulation or ordinance (including but not limited to
those governing Hazardous Materials) which may materially
and adversely affect its business operations or financial
condition or the Collateral;
(o) Owner shall, upon Lender's request, deposit all proceeds
of the Collateral into an account or accounts maintained
by Owner or Lender at Lender's institution;
(p) Owner will, upon receipt, deliver to Lender as additional
Collateral all securities distributed on account of the
collateral such as stock dividends and securities
resulting from stock splits, reorganizations and
recapitalizations;
(q) This Agreement and the obligations described in this
Agreement are executed and incurred for business and not
consumer purposes.
7. SALE OF COLLATERAL. Owner shall not assign, convey, lease,
sell or transfer any of the Collateral to any third party without
the prior written consent of Lender except for sales of inventory
to buyers in the ordinary course of business.
8. FINANCING STATEMENTS AND OTHER DOCUMENTS. Owner shall at any
time and from time to time take all actions and execute all
documents required by Lender to attach, perfect and maintain
Lender's security interest in the Collateral and establish and
maintain Lender's right to receive the payment of the proceeds of
the Collateral including, but not limited to, executing any
financing statements, fixture filings, continuation statement,
notices of security interest and other documents required by the
Uniform Commercial Code and other applicable law. Owner shall pay
the costs of filing such documents in all offices wherever filing
or recording is deemed by lender to be necessary or desirable.
Lender shall be entitled to perfect its security interest in the
Collateral by filing carbon, photographic or other reproductions of
this Agreement and/or the aforementioned documents with any
authority required by the Uniform Commercial Code or other
applicable law. Owner authorizes Lender to execute and file any
financing statements, as well as extensions, renewals and
amendments of financing statements in such form as Lender may
require to perfect and maintain perfection of any security interest
granted in this Agreement.
9. INQUIRIES AND NOTIFICATION TO THIRD PARTIES. Owner hereby
authorized Lender to contract any third party and make any inquiry
pertaining to Owner's financial condition or the Collateral. In
addition, Lender is authorized to provide oral or written notice of
its security interest in the Collateral to any third party.
10. LOCK BOX, COLLATERAL ACCOUNT. If Lender so requests at any
time (whether or not Owner is in default of this Agreement), Owner
will direct each of its account debtors to make payments due under
the relevant account or chattel paper directly to a special lock
box to be under the control of Lender. Owner hereby authorizes and
directs Lender to deposit into a special collateral account to be
established and maintained with Lender all checks, drafts and cash
payments received int he lock box. All deposits in the collateral
account shall constitute proceeds of Collateral and shall not
constitute payment of any Obligation. At its option, Lender may,
at any time, apply finally collected funds to withdraw all or any
part of the balance on deposit in the collateral account. If a
collateral account is so established, Owner agrees that Owner will
promptly deliver to Lender, for deposit into the collateral
account, all payments on accounts and chattel paper received by
Owner. All such payments shall be delivered to Lender in the form
received (except for Owner's endorsement if necessary). Until so
deposited, all payments on accounts and chattel paper received by
Owner shall be held in trust by Owner for and as the property of
Lender and shall not be commingled with any funds or property of
Owner.
11. COLLECTION OF INDEBTEDNESS FROM THIRD PARTIES. Lender shall
be entitled to notify, and upon the request of Lender, Owner shall
notify any account debtor or other third party (including, but not
limited to, insurance companies) to pay any indebtedness or
obligation owing to Owner and constituting the Collateral
(collectively "Indebtedness") to Lender whether or not a default
exists under this Agreement. Owner shall diligently collect the
Indebtedness owing to Owner from its account debtors and other
third parties until the giving of such notification. In the event
that Owner possesses or receives possession of any instruments or
other remittances with respect to the indebtedness following the
giving of such notification or if the instruments or other
remittances constitute the prepayment of any Indebtedness or the
payment of any insurance proceeds, Owner shall hold such
instruments and other remittances in trust for Lender apart from
its other property, endorse the instruments and other remittances
to Lender, and immediately provide Lender with possession of the
instruments and other remittances. Lender shall be entitled, but
not required, to collect (by legal proceedings or otherwise),
extend the time for payment, compromise, exchange or release any
obligor or collateral, or otherwise settle any of the Indebtedness
whether or not an event of default exists under this Agreement.
Lender shall not be liable to Owner for any action, error, mistake,
omission or delay pertaining to the actions described in this
paragraph or any damages resulting therefrom.
12. POWER OF ATTORNEY. Owner hereby appoints Lender as its
attorney-in-fact to endorse Owner's name on all instruments and
other remittances payable to Owner with respect to the
Indebtedness, including any items received by lender in any lockbox
account, or other documents pertaining to Lender's actions in
connection with the Indebtedness. In addition, Lender shall be
entitled, but not required, to perform any action or execute any
document required to be taken or executed by Owner under this
Agreement. Lender's performance of such action or execution of
such documents shall not relieve Owner from any obligation or cure
any default under this Agreement. The powers of attorney described
in this paragraph are coupled with an interest and are irrevocable.
13. USE AND MAINTENANCE OF COLLATERAL. Owner shall use the
Collateral solely in the ordinary course of its business, for the
usual purposes intended by the manufacturer (if applicable), with
due care, and in compliance with the laws, ordinances, regulations,
requirements and rules of all federal, state, county and municipal
authorities including environmental laws and regulations and
insurance policies. Owner shall not make any alterations,
additions or improvements to the Collateral without the prior
written consent of Lender. Owner shall ensure that Collateral
which is not now a fixture does not become a fixture. Without
limiting the foregoing, all alterations, additions and improvements
made to the Collateral shall be subject to the security interest
belonging to Lender, shall not be removed without the prior written
consent of Lender, and shall be made at Owner's sole expense.
Owner shall take all actions and make any repairs or replacements
needed to maintain the Collateral in good condition and working
order.
14. LOSS OR DAMAGE. Owner shall bear the entire risk of any loss,
theft, destruction or damage (collectively "Loss or Damage") to all
or any part of the Collateral. In the event of any Loss or Damage,
Owner will either restore the Collateral to its previous condition,
replace the Collateral with similar property acceptable to Lender
in its sole discretion, or pay or cause to be paid to Lender the
decrease in the fair market value of the affected Collateral.
15. INSURANCE. The Collateral will be kept insured for its full
value against all hazards including loss or damage caused by fire,
collision, theft or other casualty. If the Collateral consists of
a motor vehicle, Owner will obtain comprehensive and collision
coverage in amounts at least equal to the actual cash value of the
vehicle with deductibles not to exceed $ n/a . Insurance
coverage obtained by Owner shall be from a licensed insurer subject
to Lender's approval. Owner shall assign to Lender all rights to
receive proceeds of insurance not exceeding the amount owed under
the Obligations described above, and direct the insurer to pay all
proceeds directly to Lender. The insurance policies shall require
the insurance company to proved Lender with at least n/a
days' written notice before such policies are altered or canceled
in any manner. The insurance policies shall name Lender as a loss
payee and provide that no act or omission of Owner or any other
person shall affect the right of Lender to be paid the insurance
proceeds pertaining to the loss or damage of the Collateral. In
the event Owner fails to acquire or maintain insurance, Lender
(after providing notice as may be required by law) may in its
discretion procure appropriate insurance coverage upon the
Collateral and charge the insurance cost as an advance of principal
under the promissory note. Owner shall furnish Lender with
evidence of insurance indicating the required coverage. Lender may
act as attorney-in-fact for Owner in making and settling claims
under insurance policies, canceling any policy or endorsing Owner's
name on any draft or negotiable instrument drawn by any insurer.
16. INDEMNIFICATION. Lender shall not assume or be responsible
for the performance of any of Owner's obligations with respect to
the Collateral under any circumstances. Owner shall immediately
provide Lender with written notice of and hereby indemnifies and
holds Lender and its shareholders, directors, officers, employees
and agents harmless from all claims, damages, liabilities
(including attorneys' fees and legal expenses), causes of action,
actions, suits and other legal proceedings (collectively "Claims")
pertaining to its business operations or the Collateral including,
but not limited to, those arising from Lender's performance of
Owner's obligations with respect to the Collateral or claims
involving Hazardous Materials. Owner, upon the request of Lender,
shall hire legal counsel to defend Lender from such Claims, and pay
the attorneys' fees, legal expenses and other costs to the extent
permitted by applicable law, incurred in connection therewith. In
the alternative, Lender shall be entitled to employ its own legal
counsel to defend such Claims at Owner's cost.
17. TAXES AND ASSESSMENTS. Owner shall execute and file all tax
returns and pay all taxes, licenses, fees and assessments relating
to its business operations and the Collateral (including, but not
limited to, income taxes, personal property taxes, withholding
taxes, sales taxes, use taxes, excise taxes and workers'
compensation premiums) in a timely manner.
18. INSPECTION OF COLLATERAL AND BOOKS AND RECORDS. Owner shall
allow Lender or its agents to examine, inspect and make abstracts
and copies of the Collateral and Owner's books and records
pertaining to Owner's business operations and financial condition
or the Collateral during normal business hours. Owner shall
provide any assistance required by Lender for these purposes. All
of the signatures and information pertaining to the Collateral or
contained in the books and records shall be genuine, true, accurate
and complete in all respects. Owner shall note the existence of
Lender's security interest in its books and records pertaining to
the Collateral.
19. DEFAULT. Owner shall be in default under this Agreement in
the event that Owner, Borrower or any guarantor:
(a) fails to make any payment under this Agreement or any
other indebtedness to Lender when due;
(b) fails to perform any obligation or breaches any warranty
or covenant to Lender contained in this Agreement or any
other present or future written agreement regarding this
or any other indebtedness to Lender;
(c) provides or causes any false or misleading signature or
representation to be provided to Lender;
(d) sells, conveys, or transfers rights in any Collateral
without the written approval of Lender; destroys, loses
or damages such Collateral in any material respect; or
subjects such Collateral to seizure, confiscation, or
condemnation;
(e) seeks to revoke, terminate or otherwise limit its
liability under any continuing guaranty;
(f) has a garnishment, judgment, tax levy, attachment or lien
entered or served against Owner, Borrower, or any
guarantor, or any of their property;
(g) dies, becomes legally incompetent, is dissolved or
terminated, ceases to operate its business, becomes
insolvent, makes an assignment for the benefit of
creditors, fails to pay any debts as they become due, or
becomes the subject of any bankruptcy, insolvency or
debtor rehabilitation proceeding;
(h) allows the Collateral to be used by anyone to transport
or store goods, the possession, transportation, or use of
which, is illegal; or
(i) causes Lender to deem itself insecure due to a
significant decline in the value of any of the Collateral
or Lender, in good faith, believes the prospect of
payment or performance is impaired.
20. RIGHTS OF LENDER ON DEFAULT. If there is a default under this
Agreement, Lender shall be entitled to exercise one or more of the
following remedies without notice or demand (except as required by
law):
(a) to declare the Obligations immediately due and payable in
full;
(b) to collect the outstanding Obligations with or without
resorting to judicial process;
(c) to change Owner's mailing address, open Owner's mail, and
retain any instruments or other remittances constituting
the Collateral contained therein;
(d) to take possession of any Collateral in any manner
permitted by law;
(e) to apply for and obtain, without notice and upon ex parte
application, the appointment of a receiver for the
Collateral without regard to Owner's financial condition
or solvency, the adequacy of the Collateral to secure the
payment or performance of the obligations, or the
existence of any waste to the Collateral;
(f) to require Owner to deliver and make available to Lender
any Collateral at a place reasonably convenient to Owner
and Lender;
(g) to sell, lease or otherwise dispose of any Collateral and
collect any deficiency balance with or without resorting
to legal process;
(h) to set-off Owner's obligations against any amounts due to
Owner including, but not limited to, monies, instruments,
and deposit accounts maintained with Lender; and
(i) to exercise all other rights available to Lender under
any other written agreement or applicable law.
Lender's rights are cumulative and may be exercised together,
separately, and in any order. Unless the Collateral is perishable,
threatens to decline speedily in value or is of a type customarily
sold on a recognized market, Lender will provide reasonable
notification of the time and place of any sale or intended
disposition as required under the Uniform Commercial Code. In the
event that Lender institutes an action to recover any Collateral or
seeks recovery of any Collateral by way of a prejudgment remedy in
an action against Owner, Owner waives the posting of any bond which
might otherwise be required. Upon default, Owner shall segregate
all proceeds of Collateral and hold such proceeds in trust for
Lender. Lender's remedies under this paragraph are in addition to
those available at common law, such as offset.
21. APPLICATION OF PAYMENTS. Whether or not a default has
occurred under this Agreement, all payments made by or on behalf of
Owner and all credits due to Owner from the disposition of the
Collateral or otherwise may be applied against the amounts paid by
lender (including attorneys' fees and legal expenses) in connection
with the exercise of its rights or remedies described in this
Agreement and any interest thereon and then to the payment of the
remaining Obligations in whatever order Lender chooses.
22. REIMBURSEMENT OF AMOUNTS EXPENDED BY LENDER. Owner shall
reimburse Lender for all amounts (including attorneys' fees and
legal expenses) expended by Lender in the performance of any action
required to be taken by Owner or the exercise of any right or
remedy belonging to Lender under this Agreement, together with
interest thereon at the lower of the highest rate described in any
promissory note or credit agreement executed by Borrower or Owner
or the highest rate allowed by law from the date of payment until
the date of reimbursement. These sums shall be included in the
definition of Obligations, shall be secured by the Collateral
identified in this Agreement and shall be payable upon demand.
23. ASSIGNMENT. Owner shall not be entitled to assign any of its
rights, remedies or obligations described in this Agreement without
the prior written consent of Lender. Consent may be withheld by
Lender in its sole discretion. lender shall be entitled to assign
some or all of its rights and remedies described in this Agreement
without notice to or the prior consent of Owner in any manner.
24. MODIFICATION AND WAIVER. The modification or waiver of any of
Owner's Obligations or Lender's rights under this Agreement must be
contained in a writing signed by Lender. Lender may perform any of
Owner's Obligations or delay or fail to exercise any of its rights
without causing a waiver of those Obligations or rights. A waiver
on one occasion shall not constitute a waiver on any other
occasion. Owner's Obligations under this Agreement shall not be
affected if Lender amends, compromises, exchanges, fails to
exercise, impairs or releases any of the obligations belonging to
any Owner or third party or any of its rights against any Owner,
third party or collateral.
25. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
and inure to the benefit of Owner and Lender and their respective
successors, assigns, trustees, receivers, administrators, personal
representatives, legatees, and devisees.
26. NOTICES. Any notice or other communication to be provided
under this Agreement shall be in writing and sent to the parties at
the addresses described in this Agreement or such other address as
the parties may designate in writing from time to time.
27. SEVERABILITY. If any provision of this Agreement violates the
law or is unenforceable, the rest of the Agreement shall remain
valid.
28. APPLICABLE LAW. This Agreement shall be governed by the laws
of the state indicated in Lender's address. Unless applicable law
provides otherwise, Owner consents to the jurisdiction of any court
located in such state selected by Lender in the event of any legal
proceeding under this Agreement.
29. COLLECTION COSTS. To the extent permitted by law, Owner
agrees to pay Lender's reasonable fees and costs of attorneys and
other agents (including without limitation paralegals, clerks and
consultants), which are incurred by Lender in collecting any amount
due or enforcing any right or remedy under this Agreement, whether
or not suit is brought, and including, but not limited to, all fees
and costs incurred on appeal, in bankruptcy, and for post-judgment
collection actions.
30. MISCELLANEOUS. This Agreement is executed for commercial
purposes. Owner shall supply information regarding Owner's
business operations and financial condition or the Collateral in
the form and manner as requested by Lender from time to time. All
information furnished by Owner to Lender shall be true, accurate
and complete in all respects. Owner and Lender agree that time is
of the essence. Owner waives presentment, demand for payment,
notice of dishonor and protest except as required by law. All
references to owner in this Agreement shall include all parties
signing below except Lender. This Agreement shall be binding upon
the heirs, successors and assigns of Owner and Lender. If there is
more than one Owner, their obligations under this Agreement shall
be joint and several. This Agreement shall remain in full force
and effect until Lender provides Owner with written notice of
termination. This Agreement represent the complete and integrated
understanding between Owner and Lender regarding the terms hereof.
31. WAIVER OF JURY TRIAL. LENDER AND OWNER HEREBY WAIVE ANY RIGHT
TO TRIAL BY JURY IN ANY CIVIL ACTION ARISING OUT OF, OR BASED UPON,
THIS SECURITY AGREEMENT.
32. ADDITIONAL TERMS.
See Stock Pledge Agreement dated 7-31-96
_________________________________________________________________
OWNER ACKNOWLEDGES THAT OWNER HAS READ, UNDERSTANDS, AND AGREES TO
THE TERMS AND CONDITIONS OF THIS AGREEMENT AND THE SCHEDULES
ATTACHED HERETO. OWNER ACKNOWLEDGES RECEIPT OF ANY EXACT COPY OF
THIS AGREEMENT.
Dated: July 31, 1996
OWNER: C Edward Glasscock LENDER: [NAME OMITTED]
____________________________ By: /s/ Robin J. Key
C. Edward Glasscock ROBIN J KEY
VICE PRESIDENT
SCHEDULE A
327,139 shares of Series C preferred stock of DMI Furniture, Inc.;
5,719 shares of Series C preferred stock of DMI Furniture, Inc.;
and 95, 387 shares of common stock of DMI Furniture, Inc.
