Second Modification of Amended and Restated Note

 Prudential                         Prudential Capital Group
                                   Corporate Finance
                                   Two Prudential Plaza, Suite 5600,
                                   Chicago IL 60601-6716
                                   Tel 3l2 540-0931 Fax 3l2 540-4222
                                        

                              As of January 29, 1998

Ace Hardware Corporation
2200 Kensington Court
Oak Brook, Illinois 60521

Attention: Treasurer

     Re:  Second  Modification  of Amended  and  Restated  Note
          Purchase  and  Private Shelf Agreement  dated  as  of
          August 23, 1996, as amended by the First Modification
          of  Amended  and Restated Purchase and Private  Shelf
          Agreement  dated  as  of April  2,  1997  (the  "Note
          Agreement"), by and between Ace Hardware  Corporation
          (the  "Company") and The Prudential Insurance Company
          of America ("Prudential")

Ladies and Gentlemen:

     Reference is made to the above-captioned Note Agreement, pursuant to 
which the Company issued and sold (or will issue and sell) and Prudential 
purchased (or will purchase) the Company's (i) 6.47% Senior Series A Notes  
in the original principal amount of $30,000,000, due June 22, 2008, 
(ii)  7.49% Senior Series B Notes in the original principal amount of 
$20,000,000, due June 15, 2011, (iii) 7.55% Senior Series C Notes in the
original principal amount of $30,000,000, due March 25, 2009 and (iv) 6.61% 
Senior Series D Notes in the original principal amount of $25,000,000, due 
February 9, 2010.  Capitalized terms used and not otherwise defined herein  
shall have the meanings assigned to such terms in the Note Agreement.

     Pursuant to the request of the Company and in accordance with the 
provisions of paragraph 11C of the Note Agreement, the parties hereto agree 
as follows:

     SECTION 1. Amendment.  From and after the date this letter becomes 
effective in accordance with its terms, the Note Agreement is amended as 
follows:

     1.1  Paragraph 1B is amended by deleting "$70,000,000" and substituting 
 "$75,000,000" therefor.  The Company and Prudential agree that, after giving
effect to the sale of the Series D Notes, the amount available under the 
Facility is $0.

Ace Hardware Corporation
As of January 29, 1998
Page 2

     1.2   Paragraph 9B is amended by deleting in its  entirety and 
substituting therefor the following:

               9B.  Source of Funds.  The source of  the  funds
          being  used  by  such Purchaser to pay  the  purchase
          price  of the Notes being purchased by such Purchaser
          hereunder  constitutes assets allocated to:  (i)  the
          "insurance company general account" of such Purchaser
          (as  such  term  is defined under Section  V  of  the
          United   States  Department  of  Labor's   Prohibited
          Transaction Class Exemption ("PTCE") 95-60),  and  as
          of  the  date  of  the purchase  of  the  Notes  such
          Purchaser    satisfies   all   of   the    applicable
          requirements for relief under Sections I  and  IV  of
          PTCE  95-60,  (ii) a separate account  maintained  by
          such  Purchaser  in which no employee  benefit  plan,
          other  than  employee benefit plans identified  on  a
          list  which  has been furnished by such Purchaser  to
          the  Company, participates to the extent  of  10%  or
          more or (iii) an investment fund, the assets of which
          do  not  include  any assets of any employee  benefit
          plan.   For  the  purpose of this paragraph  9B,  the
          terms  "separate account" and "employee benefit plan"
          shall  have  the  respective  meanings  specified  in
          section 3 of ERISA.

     SECTION 2. Conditions Precedent.  This letter shall become effective as 
of January 29, 1998 upon the return by the Company to  Prudential of a 
counterpart hereof duly executed by the Company.

     SECTION  3.  Reference to and Effect on Note  Agreement.  Upon the 
effectiveness of this letter, each reference to the Note Agreement in any 
other document, instrument or agreement shall mean and be a reference to the 
Note Agreement as modified by this letter.  Except as specifically set forth 
in Section I hereof, the Note Agreement shall remain in full force and effect
and is hereby ratified and confirmed in all respects.

     SECTION  4. Governing Law. THIS LETTER SHALL BE  CONSTRUED AND ENFORCED 
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF ILLINOIS, WITHOUT 
REGARD TO PRINCIPLES OF CONFLICT OF  LAWS OF SUCH STATE.

Ace Hardware Corporation
As of January 29, 1998
Page 3

     SECTION 5. Counterparts; Section Titles.  This letter may be executed 
in any number of counterparts, each of which when so executed and delivered 
shall be deemed to be an original and all of which taken together shall 
constitute but one and the same instrument.  The section titles contained in 
this letter are and shall be without substance, meaning or content of any 
kind whatsoever and are not a part of the agreement between the parties 
hereto.

                         Very truly yours,

                              THE PRUDENTIAL INSURANCE
                                COMPANY OF AMERICA

                              By:____________________________
                                        Vice President

Agreed and Accepted:

ACE HARDWARE CORPORATION

By:______________________________
Title:_____________________________ 

Basic Info X:

Name: Second Modification of Amended and Restated Note
Type: Second Modification of Amended and Restated Note
Date: March 18, 1998
Company: ACE HARDWARE CORP
State: Delaware

Other info:

Date:

  • August 23 , 1996
  • April 2 , 1997
  • June 22 , 2008
  • June 15 , 2011
  • March 25 , 2009
  • February 9 , 2010
  • 95-60
  • January 29 , 1998

Organization:

  • Prudential Prudential Capital Group Corporate Finance Two Prudential Plaza
  • Ace Hardware Corporation 2200 Kensington Court Oak Brook
  • Second Modification of Amended and Restated Note Purchase
  • First Modification of Amended and Restated Purchase and Private Shelf Agreement
  • Prudential Insurance Company of America
  • United States Department of Labor

Location:

  • Chicago
  • ILLINOIS
  • AMERICA

Money:

  • $ 20,000,000
  • $ 30,000,000
  • $ 25,000,000
  • $ 70,000,000
  • $ 75,000,000
  • $ 0

Percent:

  • 6.47 %
  • 7.49 %
  • 7.55 %
  • 6.61 %
  • 10 %