EXHIBIT 4.4


P&F INDUSTRIES,
INC.


AMENDMENT NO. 2 AND WAIVER

TO

CREDIT AGREEMENT


THIS AMENDMENT NO. 2 AND
WAIVER TO CREDIT AGREEMENT,   is entered into as
of December 27, 2005 (the “Amendment and Waiver”), by and among P&F INDUSTRIES, INC., a Delaware
corporation (“P&F”), FLORIDA PNEUMATIC MANUFACTURING CORPORATION,
a Florida corporation (“Florida Pneumatic”), EMBASSY
INDUSTRIES, INC., a New York corporation (“Embassy”), GREEN MANUFACTURING, INC., a Delaware
corporation (“Green”), COUNTRYWIDE HARDWARE,
INC., a Delaware corporation (“Countrywide”), NATIONWIDE INDUSTRIES, INC., a Florida
corporation (“Nationwide”) and WOODMARK
INTERNATIONAL, L.P. (“Woodmark”; and collectively with P&F,
Florida Pneumatic, Embassy, Green, Countrywide and Nationwide, the “Co-Borrowers”),
CITIBANK, N.A. and HSBC BANK USA, NATIONAL ASSOCIATION
(formerly known as HSBC Bank USA) (collectively, the “Lenders”) and CITIBANK, N.A., as Administrative Agent for
the Lenders.


BACKGROUND


The Co-Borrowers, the Lenders and the Administrative
Agent are parties to a Credit Agreement, dated as of June 30, 2004 (as
same has been and may be further amended, restated, supplemented or modified,
from time to time, the “Credit Agreement”), pursuant to which the Lenders
provide the Co-Borrowers with certain financial accommodations.


The Co-Borrowers have requested, and the
Administrative Agent and the Lenders have agreed, subject to the terms and
conditions of this Amendment and Waiver, to amend and waive certain provisions
of the Credit Agreement as herein set forth. Capitalized terms used herein and
not defined herein shall have the meanings given to them in the Credit
Agreement.


Accordingly, in
consideration of the premises and of the mutual covenants and agreements
hereinafter set forth, the parties hereto agree as follows:


ARTICLE I.


Amendments to Credit Agreement.


Section 1.1.   The first sentence of Section 3.02
of the Credit Agreement is hereby amended and restated in its entirety to
provide as follows:


“The proceeds of the Revolving Credit Loans shall be used
by the Co-Borrowers for general corporate purposes, to finance ongoing working
capital requirements, to refinance a portion of the Existing Indebtedness and
to finance a capital contribution by P&F or Countrywide to Pacific Stair
Products, Inc., a Delaware corporation (“Pacific”) and a wholly-owned
subsidiary of Countrywide, in order to permit the acquisition by Pacific of
assets and the assumption of certain liabilities of Pacific Stair Products, a
California corporation.”


Section 1.2.   The reference to the amount “$12,5000,000”
on the third to last line of Section 7.06 of the Credit Agreement is
hereby amended and replaced with the amount “$12,500,000”.











Section 1.3.   The
table in Section 7.13(b) of the Credit Agreement is hereby amended and
restated in its entirety to provide as follows:




	
  Period

  	
   

  	
   

  	
   

  	
  Amount

  	
   

  
	
  December 31, 2004
  through December 30, 2005

  	
   

  	
  $

  	
  9,500,000

  	
   

  
	
  December 31, 2005
  through December 30, 2006

  	
   

  	
  $

  	
  16,500,000

  	
   

  
	
  December 31, 2006
  through December 30, 2007

  	
   

  	
  $

  	
  22,000,000

  	
   

  
	
  December 31, 2007
  and thereafter

  	
   

  	
  $

  	
  25,000,000

  	
   

  






 


ARTICLE II.


Waiver.


Section 2.1.   The Co-Borrowers have advised
the Lenders that Pacific Stair Products, Inc., a Delaware corporation (“Pacific”),
intends to purchase the assets of Pacific Stair Products, a California
corporation (the “Purchase”) for a Permitted Acquisition Purchase Price not to
exceed $5,900,000 (the “Purchase”). The Lenders hereby waive compliance by the
Co-Borrowers with the provisions in the Credit Agreement regarding Permitted
Acquisitions which (a) require that only a Co-Borrower enter in a
Permitted Acquisition and (b) restrict the Permitted Acquisition Purchase
Price in connection with any single Permitted Acquisition to exceed $5,000,000,
provided that all other requirements for a Permitted Acquisition with respect
to the Purchase have been satisfied and that Pacific shall become a Co-Borrower
or a Guarantor under the Credit Agreement and in connection therewith shall
execute and deliver such documents as may be reasonably required by the Lenders
by no later than January 23, 2006, including, without limitation, those
documents described on Schedule 1 attached hereto.  In addition, the Lenders hereby waive
compliance by the Co-Borrowers with Section 7.06 of the Credit Agreement
which restricts the Co-Borrowers’ ability to make a Permitted Acquisition at
any time that the outstanding principal balance of the Term Loan is in excess
of $12,500,000. Notwithstanding anything to the contrary herein, the waivers
set forth in this Section 2.1 shall apply only to the Purchase.


Section 2.2.   Co-Borrowers
have advised the Lenders that P&F intends to form a new Subsidiary (“Newco”)
to which P&F will transfer all of its limited partnership interest in
Woodmark and subsequent to such transfer, P&F will contribute all of its
ownership interest in Newco to Countrywide (the “Woodmark Transaction”). The
Lenders hereby waive compliance by the Co-Borrowers with  the Credit Agreement and the other Loan
Documents, including, but not limited to, Sections 6.10, 7.04 and 7.06 of the
Credit Agreement, and hereby waive any event of default that would arise under
the Credit Agreement, provided that evidence of the transfer of assets to Newco
and all documents required by Section 6.10 shall be executed and delivered
to the Administrative Agent by no later than January 23, 2006. In
addition, in the event that Newco shall become a Co-Borrower (rather than a
Guarantor) under the Credit Agreement, the Co-Borrowers shall further deliver
to the Administrative Agent such additional documents as may be reasonably
required by the Lenders to evidence such status. Notwithstanding anything to
the contrary herein, the waiver set forth in this Section 2.2 shall apply
only to the Woodmark Transaction.


ARTICLE III.


Conditions of Effectiveness.


This Amendment and Waiver shall
become effective as of the date hereof, upon receipt by the Administrative
Agent of this Amendment and Waiver, duly executed by each Co-Borrower and each
Lender, and a copy of the duly executed Asset Purchase Agreement, Bill of Sale,
Assignment and Assumption Agreement (if any) all in connection with the
Purchase, along with lien searches with respect to Pacific Stair Products, a
California corporation.



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ARTICLE IV.


Representations and Warranties; Effect on Credit
Agreement.


Section 3.1.   Each
Co-Borrower hereby represents and warrants as follows:


a.      This
Amendment and Waiver and the Credit Agreement, as amended hereby, constitute
legal, valid and binding obligations of the Co-Borrowers and are enforceable
against the Co-Borrowers in accordance with their respective terms.


b.      Upon the
effectiveness of this Amendment and Waiver, the Co-Borrowers hereby reaffirm
all covenants, representations and warranties made in the Credit Agreement to
the extent that the same are not amended hereby and each Co-Borrower agrees
that all such covenants, representations and warranties shall be deemed to have
been remade as of the date hereof.


c.      No
Default or Event of Default has occurred and is continuing or would exist after
giving effect to this Amendment and Waiver.


d.      No
Co-Borrower has any defense, counterclaim or offset with respect to the Credit
Agreement.


Section 3.2.   Effect on Credit Agreement.


a.      Upon the
effectiveness of this Amendment and Waiver, each reference in the Credit
Agreement to “this Agreement”, “hereunder”, “hereof”, “herein” or words of like
import shall mean and be a reference to the Credit Agreement as amended hereby.


b.      Except as
specifically amended herein, the Credit Agreement, and all other documents,
instruments and agreements executed and/or delivered in connection therewith,
shall remain in full force and effect, and are hereby ratified and confirmed.


c.      Except as
expressly provided  herein, the
execution, delivery and effectiveness of this Amendment and Waiver shall not
operate as a waiver of any right, power or remedy of the Administrative Agent
or the Lenders, nor constitute a waiver of any provision of the Credit
Agreement, or any other documents, instruments or agreements executed and/or
delivered under or in connection therewith.


ARTICLE V.


Miscellaneous.


Section 4.1.   This Amendment and Waiver
shall be governed by and construed in accordance with the laws of the State of
New York.


Section 4.2.   Section headings in this
Amendment and Waiver are included herein for convenience of reference only and
shall not constitute a part of this Amendment 
and Waiver for any other purpose.


Section 4.3.   This Amendment and Waiver may
be executed in one or more counterparts, each of which shall constitute an
original, and all of which, taken together, shall be deemed to constitute one
and the same agreement.



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IN
WITNESS WHEREOF, the Co-Borrowers, the Lenders and the
Administrative Agent have caused this Amendment and Waiver  to be duly executed by their duly authorized
officers as of the day and year first above written.




	
   

  	
   

  	
  P&F INDUSTRIES, INC.

  
	
   

  	
   

  	
  FLORIDA PNEUMATIC MANUFACTURING CORPORATION

  
	
   

  	
   

  	
  EMBASSY INDUSTRIES, INC.

  
	
   

  	
   

  	
  GREEN MANUFACTURING, INC.

  
	
   

  	
   

  	
  COUNTRYWIDE HARDWARE, INC.

  
	
   

  	
   

  	
  NATIONWIDE INDUSTRIES, INC.

  
	
   

  	
   

  	
  WOODMARK INTERNATIONAL, L.P.

  
	
   

  	
   

  	
  By:

  	
   

  	
  Countrywide Hardware, Inc., its General Partner

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/ JOSEPH A.
  MOLINO, JR.

  
	
   

  	
   

  	
   

  	
   

  	
  Joseph A. Molino, Jr.,

  
	
   

  	
   

  	
   

  	
   

  	
  the Vice President of each of the foregoing
  corporations

  
	
   

  	
   

  	
  CITIBANK, N.A.,as a Lender and as Administrative Agent

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/ STEPHEN
  KELLY

  
	
   

  	
   

  	
  Name:

  	
   

  	
  Stephen Kelly

  
	
   

  	
   

  	
  Title:

  	
   

  	
  Vice President

  
	
   

  	
   

  	
  HSBC BANK USA, NATIONAL ASSOCIATION,
  as a Lender

  
	
   

  	
   

  	
  By:

  	
   

  	
  /s/ RAYMOND
  FINCKEN

  
	
   

  	
   

  	
  Name:

  	
   

  	
  Raymond Fincken

  
	
   

  	
   

  	
  Title:

  	
   

  	
  Vice President

  
						






 



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