Document:

LANDLORD FORBEARANCE
AGREEMENT

     

    This
FORBEARANCE AGREEMENT, dated as of _________, 2009 (this “Agreement”), is made
by and among Thomas and Juanita Spatola, husband and wife (“Landlord”), Pierce
Hardy Limited Partnership, a Pennsylvania limited partnership (“Tenant”), ABLECO
FINANCE LLC, a
Delaware limited liability company, as collateral and administrative agent (in
such capacity, “Ableco”), and
SUNTRUST BANK, as administrative agent and a co-collateral agent (in such
capacity, “SunTrust”).

     

    RECITALS

     

    A.           Landlord
and Tenant are parties to a lease agreement, dated ___________, 2008, (the
"Lease"), for
the demise of the premises as described in the Lease (the “Premises”), a copy of
which is attached hereto as Schedule 1 and made a
part of this Agreement.

     

    B.           The
Lease provides Landlord with the option to require Tenant to purchase the
Premises (the “Option”), as further
provided in the Lease.

     

    C.           Pursuant
to that certain Credit Agreement, dated as of April 18, 2008 (as amended,
restated, supplemented, refinanced, renewed, replaced or otherwise modified from
time to time, the “Credit Agreement”),
by and among 84 Lumber Company, a Pennsylvania limited partnership (“84 Lumber”), the
guarantors party thereto, the lenders from time to time party thereto (the
“ABL Lenders”),
SunTrust (and its successors and assigns) and Wachovia Bank, National
Association, as a Co-Collateral Agent (and its successors and assigns), the ABL
Lenders have agreed to make certain Revolving Loans and Commitments (each as
defined in the Credit Agreement) (collectively, the “ABL Facility”)
available to 84 Lumber pursuant to the terms of the Credit
Agreement.

     

    D.           Pursuant
to that certain Financing Agreement, dated as of April 18, 2008 (as amended,
restated, supplemented, refinanced, renewed, replaced  or otherwise
modified from time to time, the “Financing
Agreement”), by and among the Borrowers (as defined in the Financing
Agreement), Guarantors (as defined in the Financing Agreement), the lenders from
time to time party thereto (the “Term Lenders,” and
together with the ABL Lenders, collectively, the “Lenders”), and Ableco
(and its successors and assigns), Term Lenders have agreed to extend to the
Borrowers thereunder  a certain term loan facility (the “Term Loan Facility”)
pursuant to the terms of the Financing Agreement.

     

    E.           As
a condition, among others, to the effectiveness of the ABL Facility and the Term
Loan Facility, the Lenders are requiring Landlord to forbear from exercising its
rights under the Option until all (i) Obligations (as defined in the Financing
Agreement) of the Borrowers under the Financing Agreement have been fully
performed and discharged and the Loan has been repaid in full in accordance with
the Financing Agreement, and (ii) Obligations (as defined in the Credit
Agreement) have been satisfied in full and the commitments of the ABL Lenders
thereunder have been terminated (the date on which both clauses (i) and (ii)
have been satisfied, the “Forbearance Termination
Date”).

     

    F.           Tenant
hereby requests that Landlord forbear from exercising its rights under the
Option until the Forbearance Termination Date.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    G.           Landlord
is willing and agrees to forbear from exercising its rights under the Option
until the Forbearance Termination Date.

     

    H.           Landlord
and Tenant acknowledge that Ableco, Suntrust and the Lenders are relying on this
Agreement in entering into the Credit Agreement and the Financing Agreement and
providing the ABL Facility and the Term Loan Facility, and such reliance is
reasonable and foreseeable.

     

    NOW,
THEREFORE, in consideration of the premises and agreements herein, Landlord,
Tenant, Ableco and SunTrust hereby agree as follows:

     

    Terms of
Forbearance.

     

    Forbearance.  Landlord
agrees to forbear from exercising its rights under the Option for the period
from the date hereof until the Forbearance Termination Date.

     

    After
Forbearance.  From and after the Forbearance Termination Date,
the agreement of Landlord to forbear as set forth in this Agreement shall
automatically and without further action terminate and be of no force and
effect.  The parties expressly acknowledge and agree that the effect
of such termination will be to permit Landlord to exercise its rights under the
Option without any notice, passage of time or forbearance of any kind to Ableco
and SunTrust.

     

    Limited Effect of
Forbearance.  Subject to the foregoing, Landlord has not waived
and is not by this Agreement waiving any other of its rights existing under the
Lease, and nothing contained herein shall be deemed to constitute any such
waiver.

     

    Miscellaneous.

     

    Successors and
Assigns.  This Agreement shall (i) be binding on Landlord,
Tenant, Ableco, SunTrust and their respective successors and assigns, and
(ii) inure to the benefit of the Landlord, Tenant, Ableco, SunTrust and
their respective successors and assigns.

     

    Counterparts.  This
Agreement may be executed in any number of counterparts and by the different
parties hereto in separate counterparts, each of which shall be deemed to be an
original, but all of which taken together shall constitute one and the same
agreement.  Delivery of an executed counterpart of this Agreement by
facsimile or electronic mail shall be equally as effective as delivery of an
original executed counterpart of this Agreement.

     

    Entire
Agreement.  This Agreement supersedes all prior discussions,
agreements, commitments, arrangements, negotiations or understandings, whether
oral or written, of the parties with respect thereto.

     

    Governing
Law.  This Agreement shall be governed by and construed in
accordance with the law of the State of New York applicable to contracts made
and to be performed within such state.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Amendments.  This
Agreement may be amended, modified or waived only in a writing signed by the
parties hereto.

     

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

     

    
      
        	
                Landlord:

              
	 
      
	 
      
	
                Thomas
      Spatola

              
	 
      
	 
      
	
                Juanita
      Spatola

              
	 
      
	
                Tenant:

              
	 
      
	
                84
      Development Company, now known as Hardy

              
	
                Management
      Company, Inc., said Hardy Management

              
	
                Company,
      Inc., as nominee for Pierce Hardy Limited

              
	
                Partnership,
      a PA limited partnership

              
	 
      	 
      
	
                By:

              	 
      
	
                Name:

              	 
      
	
                Title:

              	 
      
	 
      	 
      
	
                Ableco:

              
	 
      
	
                ABLECO
      FINANCE LLC, a Delaware limited liability

              
	
                company,
      as Collateral and Administrative Agent under the

              
	
                Financing
      Agreement

              
	 
      	 
      
	
                By:

              	 
      
	
                Name:

              	 
      
	
                Title:

              	 
      

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        	
                SunTrust

              
	 
      
	
                SUNTRUST
      BANK, as the Administrative Agent and a Co-

              
	
                Collateral
      Agent under the Credit Agreement

              
	 
      	 
      
	
                By:

              	 
      
	
                Name:

              	 
      
	
                Title:

              	 
      

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    SCHEDULE
1

    

    [LEASE]Exhibit
10.7

    

    VARIABLE
RATE REVOLVING CREDIT

    PROMISSORY
NOTE

     

    
      	 
      	
              January
      1st, 2002

            
	
              $20,000,000.00

            	
              McMurray,
      Pennsylvania

            

    

    

    FOR VALUE
RECEIVED, Hardy Credit Co., a Pennsylvania business trust (the “Obligor”),
promises to pay to the order of Margaret H. Magerko, Trustee under the
Irrevocable Trust for Margaret H. Magerko and her successors and assigns under
the 1997 Irrevocable Trust for Margaret Hardy Magerko (together with its
successors and assigns, (the “Obligee”), the lesser of (i) the principal amount
of Twenty Million Dollars ($20,000,000), or (ii) the aggregate unpaid principal
amount of all loans (which shall include all cash advances made by Obligee to
Obligor unless expressly provided otherwise in a writing contemporaneous with
any such advance) made by the Obligee to the Obligor on and after the date first
set forth above, payable together with interest paid monthly at Wall Street
Journal Prime minus 2%.

     

    Advances
under this Note are only made when both Obligor and Obligee agree to an increase
in principal.  Neither is under an obligation to do so.

     

    The
principal indebtedness evidenced by this Variable Rate Revolving Credit
Promissory Note (“Note”) shall be payable in full on November 7, 2012 to the
holder of this Note.  All payments to be made in respect of principal
under this Note shall be made in lawful money of the United States of America,
in immediately available funds and by certified check, bank cashier check or
wire transfer, delivered to Obligee at or before the time such payment is due,
in each case without setoff, counterclaim or other deduction of any
nature.

     

    Except as
otherwise expressly provided herein, Obligor hereby waives presentment for
payment, demand, protest and notice of protest, notice of dishonor or default
and all other demands and notices in connection with the delivery, acceptance,
performance, default or enforcement of this Note.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    No delay
on the part of Obligee in exercising any of its powers or rights, or partial or
single exercise thereof, shall constitute a waiver thereof.  The
unenforceability of any provision hereof shall not affect the enforceability of
the remaining provisions hereof.

     

    Obligor
further agrees that in the event Obligee institutes legal proceedings to enforce
this Note, Obligor shall pay, in addition to any principal hereunder due and
unpaid, all costs and expenses of such proceedings, including reasonable
attorneys’ fees.

     

    This Note
shall bind the Obligor and its successors and assigns and the benefits hereto
shall inure to the Obligee and its successors and assigns.

     

    This Note
shall be governed by and construed in accordance with the laws of the
Commonwealth of Pennsylvania.  Obligor consents to the jurisdiction
and venue of the Federal and state courts located in Allegheny or Washington
County, Pennsylvania with respect to any suit arising out of relating to, or
mentioning this Note.

     

    Time is
of the essence of this Note.

     

    IN
WITNESS WHEREOF, intending to be legally bound hereby, Obligor has caused this
Note to be executed and delivered as of the date first above
written.

     

    
      
        
          
            	
                    WITNESS:

                  	 	
                    OBLIGOR:

                  
	 
      	 	 
      
	 
      	 	
                    Hardy
      Credit Co.

                  
	 
      	 	 
      
	
                     /s/ Cheri B. Bomar

                  	 	
                    By:

                  	
                    /s/ Daniel M.
  Wallach

                  

          

        

      

    

     

    
      
         

      

      
        - 2 -

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