PATRICK INDUSTRIES, INC.

 

SECOND AMENDED AND RESTATED

REGISTRATION RIGHTS AGREEMENT

This Second Amended and Restated Registration Rights Agreement (the “Agreement”)
is made this 11th day of December, 2008, by and among Patrick Industries, Inc.,
an Indiana corporation (the “Company”), and the stockholders of the Company
identified on the signature page hereto (individually a “Stockholder” and
collectively the “Stockholders”). This Second Amended and Restated Registration
Rights Agreement amends and restates in its entirety that certain Amended and
Restated Registration Rights Agreement (the “Amended and Restated Registration
Rights Agreement”) dated May 18, 2007, among the Company, Tontine Capital
Partners, L.P. (“Tontine Capital”) and Tontine Capital Overseas Master Fund,
L.P. (“Tontine Overseas” and, together with Tontine Capital, the “Tontine
Stockholders”)

AGREEMENT

The parties hereby agree as follows:

1.     REGISTRATION RIGHTS. The Company and the Stockholders covenant and agree
as follows:

 

1.1

Definitions. For purposes of this Agreement:

(a)       The term “Adverse Disclosure” means public disclosure of material
non-public information relating to a significant transaction, which disclosure
(i) would be required to be made in any Registration Statement filed with the
SEC by the Company so that such Registration Statement would not be materially
misleading; (ii) would not be required to be made at such time but for the
filing of such Registration Statement; and (iii) would, in the good faith
judgment of the Company’s Board of Directors, have a material adverse effect
upon the Company’s ability to complete such significant transaction or upon the
terms on which such significant transaction could be completed

(b)       The term “Common Stock” means the common stock of the Company, without
par value, including the preferred share purchase rights which accompany each
share.

(c)       The term “Exchange Act” means the Securities Exchange Act of 1934, as
amended, or successor statute, and the rules and regulations of the SEC
promulgated thereunder.

(d)       The term “Holder” means a Stockholder that is a holder of Registrable
Securities and any transferees of such Stockholder under Section 1.11 hereof who
hold Registrable Securities.

(e)       The term “Majority Holders of the Registrable Securities” means those
Holders holding a majority of the Registrable Securities.

 

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(f)        The term “Majority Holders of the Warrant Shares” means those Holders
holding Warrants to purchase a majority of the Warrant Shares.

(g)       The terms “register,” “registered,” and “registration” refer to a
registration effected by preparing and filing a registration statement or
similar document in compliance with the Securities Act of 1933, as amended, or
successor statute, and applicable rules and regulations thereunder (the
“Securities Act”), and the declaration or ordering of effectiveness of such
registration statement or document by the SEC;

(h)       The term “Registrable Securities” means (i) the shares of Common Stock
acquired by the Tontine Stockholders pursuant to a certain Stock Purchase
Agreement dated September 13, 2005, between the Company and Tontine Capital, and
a certain Securities Purchase Agreement, dated April 10, 2007, among the
Company, Tontine Capital and Tontine Capital, and so long as this Agreement is
still in effect, any other shares of Common Stock acquired by the Stockholders
on or after the date of the Amended and Restated Registration Rights Agreement,
(ii) any securities of the Company acquired by the Tontine Stockholders in the
registered rights offering completed by the Company on June 26, 2008, (iii) any
securities of the Company acquired by the holders from time to time upon
exercise of the warrants (the “Warrants”) to purchase shares of Common Stock
(the “Warrant Shares”) issued pursuant to a certain Warrant Agreement, dated
December 11, 2008, among the Company and such holders, and (iv) any other shares
of the Company’s Common Stock issued as a dividend or other distribution with
respect to, or in exchange for or in replacement of, the shares listed in (i),
(ii) or (iii) (because of stock splits, stock dividends, reclassifications,
recapitalizations or similar events); provided, however, that the foregoing
definition shall exclude in all cases any Registrable Securities (x) which are
effectively registered under the Securities Act and disposed of in accordance
with a Registration Statement covering such shares, (y) which have been
transferred pursuant to Rule 144 under the Securities Act or any similar rule or
regulation hereafter adopted by the SEC (“Rule 144”), or (z) which are no longer
beneficially owned by any Holder;

(i)        The term “Registration Statement” means one or more Shelf
Registration Statements on Form S-3 registering the resale of Registrable
Securities, or such other registration statements filed by the Company under the
Securities Act, including the prospectuses, amendments and supplements to such
registration statements, including post-effective amendments, all exhibits and
all material incorporated by reference in such registration statements.

(j)        The term “SEC” means the Securities and Exchange Commission, or any
other Federal agency at the time administering the Securities Act; and

(k)       The term “Shelf Registration Statement” means one or more “shelf”
Registration Statements on Form S-3 filed under the Securities Act providing for
the registration of, and the sale on a continuous or delayed basis by the
Holders of, all of the Registrable Securities pursuant to Rule 415 under the
Securities Act and/or any similar rule that may be adopted by the SEC, filed by
the Company pursuant to the provisions of Section 1.2 of this Agreement.

 

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(l)        The term “Underwritten Offering” means a registration under this
Agreement in which securities of the Company are sold to an underwriter on a
firm commitment basis for reoffering to the public.

 

1.2

Registration.

(a)(i)   The Company shall use its reasonable best efforts to keep the
Registration Statement on Form S-3 (SEC File No. 333-145430) filed pursuant to
the Amended and Restated Registration Rights Agreement continuously effective
for a period of five (5) years after the Registration Statement first became
effective, subject to the terms of this Agreement. The Company shall promptly
amend such Registration Statement from time to time to include any Registrable
Securities that are issued at any time after the original filing upon written
notice to the Company by any Holder regarding the request for registration of
such newly issued Registrable Securities.

(ii)       Within one hundred and twenty (120) days of the date hereof, the
Company shall file a Registration Statement on Form S-3 under the Securities Act
registering the resale under Rule 415 under the Securities Act of all of the
Registrable Securities that may be issued upon the exercise of the Warrants. The
Registration Statement shall provide for the resale from time to time, and
pursuant to any method or combination of methods legally available on Form S-3,
by the Holders of any and all Registrable Securities that may be issued upon the
exercise of the Warrants, such methods of distribution to be provided in writing
to the Company no later than seven (7) days prior to the effective date of the
Registration Statement with the SEC. The Company shall use its reasonable best
efforts to cause the Registration Statement to be declared effective under the
Securities Act as soon as possible, but in any event, no later than sixty (60)
days from the date of filing, and shall use its reasonable best efforts to keep
the Registration Statement continuously effective for a period of five (5) years
after such Registration Statement first becomes effective, subject to the terms
of this Agreement. The Company shall promptly amend such Registration Statement
from time to time to include any Registrable Securities that are issued at any
time after the original filing upon written notice to the Company by any Holder
regarding the request for registration of such newly issued Registrable
Securities.

(iii)      Within thirty (30) days of the date hereof, the Company shall file a
Registration Statement on Form S-3 under the Securities Act registering the
resale under Rule 415 under the Securities Act of all of the Registrable
Securities that have been issued to the Tontine Stockholders after the date of
the Amended and Restated Registration Rights Agreement. The Registration
Statement shall provide for the resale from time to time, and pursuant to any
method or combination of methods legally available on Form S-3, by the Holders
of any and all Registrable Securities that have been issued after the date of
the Amended and Restated Registration Rights Agreement, such methods of
distribution to be provided in writing to the Company no later than seven (7)
days prior to the effective date of the Registration Statement with the SEC. The
Company shall use its reasonable best efforts to cause the Registration
Statement to be declared effective under the Securities Act as soon as possible,
but in any event, no later than sixty (60) days from the date of filing, and
shall use its reasonable best efforts to

 

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keep the Registration Statement continuously effective for a period of five (5)
years after such Registration Statement first becomes effective, subject to the
terms of this Agreement. The Company shall promptly amend such Registration
Statement from time to time to include any Registrable Securities that are
issued at any time after the original filing upon written notice to the Company
by any Holder regarding the request for registration of such newly issued
Registrable Securities.

(b)       If for any reason the SEC does not permit all of the Registrable
Securities to be included in a Registration Statement filed pursuant to
Section 1.2(a) or Section 1.3 below or for any other reason all Registrable
Securities are not then included in such an effective Registration Statement,
then the Company shall prepare and file as soon as reasonably possible after the
date on which the SEC shall indicate as being the first date or time that such
filing may be made an additional Registration Statement covering the resale of
all Registrable Securities not already covered by an existing and effective
Registration Statement for an offering to be made on a continuous basis pursuant
to Rule 415. Each such Registration Statement shall provide for the resale from
time to time, and pursuant to any method or combination of methods legally
available on Form S-3 by the Holders of any and all Registrable Securities, such
methods of distribution to be provided in writing to the Company no later than
seven (7) days prior to the effective date of the Registration Statement with
the SEC. The Company shall use its reasonable best efforts to cause each such
Registration Statement to be declared effective and to keep the Registration
Statement continuously effective for a period of five (5) years after the
Registration Statement first becomes effective.

 

1.3

Request for Registration.

(a)       Subject to Section 1.3(h), if the Company shall receive a written
request from the Majority Holders of the Registrable Securities then outstanding
or the Majority Holders of the Warrant Shares (the “Initiating Stockholders”)
that the Company file a Registration Statement on Form S-3 under the Securities
Act registering the resale of all or part of such Holders’ Registrable
Securities, the Company will promptly give written notice of such requested
registration to all other Holders, and thereupon the Company will use its
reasonable best efforts to file with the SEC as soon as reasonably practicable
following such demand request (but in no event later than the date that is
ninety (90) days after the demand request) such Registration Statement. The
Company shall use its reasonable best efforts to cause such Registration
Statement to be declared effective by the SEC within ninety (90) days after the
initial filing of the Registration Statement. The Company shall include in such
Registration Statement the Registrable Securities which the Company has been so
requested to be registered by the Initiating Holders and all other Registrable
Securities the Holders of which shall have made a written request to the Company
for registration thereof within thirty (30) days after the giving of such
written notice by the Company.

(b)       If the Holders of not less than 50% of the Registrable Securities
covered by a Registration Statement filed pursuant to Section 1.2 or Section 1.3
so elect, the offering of Registrable Securities pursuant to such Registration
Statement shall be in the form of an Underwritten Offering and the Company shall
amend or supplement the Registration Statement, if appropriate. Such Holders
shall have the right to select the managing underwriter or

 

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underwriters to administer the offering, subject to the approval of the Company,
which approval shall not be unreasonably withheld or delayed.

(c)       A registration requested pursuant to this Section 1.3 shall not be
deemed to have been effected unless a Registration Statement with respect
thereto has become effective; provided, that a Registration Statement that does
not become effective after the Company has filed a Registration Statement with
respect thereto solely by reason of the refusal to proceed of the Initiating
Stockholders shall be deemed to have been effected by the Company at the request
of the Initiating Stockholders.

(d)       The Company shall use its reasonable best efforts to keep any
Registration Statement filed pursuant to this Section 1.3 continuously effective
for a period of five (5) years after the Registration Statement first becomes
effective. In the event the Company shall give any notice pursuant to Section
1.3(i) or Section 1.5(d), the time period mentioned in this Section 1.3(d) (or
in Section 1.2 above) during which the required Registration Statement is to
remain effective shall be extended by the number of days during the period from
and including the date of the giving of such notice pursuant to Section 1.3(i)
or Section 1.5(d) to and including the date when each Holder covered by the
Registration Statement shall have received the copies of the supplemented or
amended prospectus contemplated by Section 1.5(g) or shall have otherwise been
notified by the Company that the Suspension has been lifted.

(e)       Notwithstanding the foregoing, if the Company shall furnish to the
Holders a certificate signed by the President of the Company stating that in the
good faith judgment of the Board of Directors of the Company, it would be
seriously detrimental to the Company and its stockholders for such Registration
Statement to be filed and it is therefore advisable to defer the filing of such
Registration Statement, the Company shall have the right to defer such filing
for a period of not more than ninety (90) days after receipt of the written
request of the Initiating Stockholders.

(f)        The Company shall not be obligated to effect, or to take any action
to effect, any registration pursuant to this Section 1.3 during the period
starting with the date ninety (90) days prior to the Company’s good faith
estimate of the date of filing of, and ending on the later of a date ninety (90)
days after the effective date of, a Registration Statement subject to Section
1.4 hereof.

(g)       Notwithstanding the foregoing, the Company shall not be required to
effect a registration pursuant to this Section 1.3 after the Company has
effected two (2) registrations pursuant to this Section 1.3 and such
registrations have been declared or ordered effective.

(h)       The right of the Holders to register Registrable Securities pursuant
to this Section 1.3 is only exercisable if the Registrable Securities were not
included in the Registration Statement contemplated by Section 1.2(a) or such
Registration Statement otherwise becomes unusable (other than due solely to some
act or omission by the Holders electing to have Registrable Securities
registered pursuant to such Registration Statement) and the Company is not able
to restore the usability of the Registration Statement as contemplated by this
Agreement.

 

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(i)        If the filing of the Registration Statement or the continued
effectiveness of the Registration Statement at any time would require the
Company to make an Adverse Disclosure, the Company may, upon giving prompt
written notice of such action to the Holders, delay filing the Registration
Statement or suspend use of the Registration Statement (in either case, a
“Suspension”); provided, however, the Company shall not be permitted to exercise
a Suspension (i) more than twice during any twelve (12) month period, (ii) for a
period exceeding thirty (30) days on any one occasion, or (iii) for an aggregate
period exceeding sixty (60) days in any twelve (12) month period. In the case of
a Suspension, the notice required above shall request the Holders to suspend any
sale or purchase, or offer to sell or purchase the Registrable Securities, and
to suspend use of the prospectus related to the registration in connection with
any such sale or purchase or offer to sell or purchase. The Company shall
promptly notify the holders upon the termination of any Suspension, and amend or
supplement the prospectus, if necessary, so it does not contain any untrue
statement or omission therein and furnish to the Holders such numbers of copies
of the prospectus as so amended or supplemented as the Holders may reasonably
request.

 

1.4

Company Registration.

(a)       The Company shall notify all Holders in writing at least thirty (30)
days prior to the filing of a Registration Statement (including, but not limited
to, a Registration Statement relating to secondary offerings of securities of
the Company, but excluding (i) Registration Statements relating solely to
employee benefit plans or debt securities, (ii) Registration Statements solely
with respect to corporate reorganizations or other transactions under Rule 145
of the Securities Act, (iii) a registration on any registration form that does
not permit secondary sales), and (iv) any Registration Statement filed to
register Registrable Securities that have been issued to the Tontine
Stockholders after the date of the Amended and Restated Registration Rights
Agreement pursuant to Section 1.2(a)(iii)), and such notice shall describe the
proposed registration and distribution.

(b)       Each Holder desiring to include in any such Registration Statement all
or any part of the Registrable Securities held by it shall, within fifteen (15)
days after the above-described notice from the Company, so notify the Company in
writing. The Company shall, subject to Section 1.7, afford each such Holder an
opportunity to include in such Registration Statement all or part of such
Registrable Securities held by such Holder.

(c)       If the Registration Statement is to be filed in connection with an
Underwritten Offering, all Holders proposing to distribute their securities
through such underwriting shall enter into an underwriting agreement in
customary form with the underwriter or underwriters selected for such
underwriting. The Company shall use its reasonable best efforts to cause the
managing underwriter or underwriters of a proposed underwritten offering to
permit the Registrable Securities to be included in a Registration Statement
under this Section 1.4 to be included on the same terms and conditions as any
similar securities of the Company or any other security holder included therein
and to permit the sale or other disposition of such Registrable Securities in
accordance with the intended method of distribution thereof.

(d)       Any Holder shall have the right to withdraw its request for inclusion
of its Registrable Securities in any Registration Statement pursuant to this
Section 1.4

 

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by giving written notice to the Company of its request to withdraw prior to the
filing of the Registration Statement.

(e)       If a Holder decides not to include all of its Registrable Securities
in any Registration Statement thereafter filed by the Company, such Holder shall
nevertheless continue to have the right to include any Registrable Securities in
any subsequent Registration Statement or Registration Statements as may be filed
by the Company with respect to offerings of its securities, all upon the terms
and conditions set forth herein. The Company shall have the right to terminate
or withdraw any registration initiated by it under this Section 1.4 prior to the
effectiveness of such registration whether or not any Holder has elected to
include securities in such registration.

(f)        In connection with any Underwritten Offering by the Company of its
Common Stock pursuant to which a Holder is entitled to include its Registrable
Securities pursuant to this Section 1.4, such Holder, if requested in good faith
by the Company and the managing underwriter of the Underwritten Offering, shall
agree not to, directly or indirectly, offer, sell, pledge, contract to sell
(including any short sale), grant any option to purchase or otherwise dispose of
any equity securities of the Company held by such Holder (except for any
securities sold pursuant to such Registration Statement) or enter into any
hedging transaction relating to any equity securities of the Company for a
period not to exceed ninety (90) days following the effective date of the
applicable Registration Statement as agreed to by such parties; provided, that
the Holders’ obligations under this paragraph (f) shall be conditioned upon all
officers and directors entering into similar agreements with such managing
underwriter. For purposes of this Section 1.4, “hedging transaction” means any
short sale (whether or not against the box) or any purchase, sale or grant of
any right (including without limitation, any put or call option) with respect to
any equity security (other than a broad-based market basket or index) that
includes, relates to or derives any significant part of its value from the
Common Stock.

1.5       Obligations of the Company. Whenever required under Section 1 to
effect the registration of any Registrable Securities, the Company will use its
reasonable best efforts to effect the registration of Registrable Securities
pursuant to this Agreement in accordance with the intended methods of
disposition thereof, and pursuant thereto the Company will as expeditiously as
possible:

(a)       Prepare and file with the SEC a Registration Statement with respect to
such Registrable Securities and use its reasonable best efforts to cause such
Registration Statement to become effective, and keep such Registration Statement
effective for the period provided for in this Agreement.

(b)       Promptly prepare and file with the SEC such amendments and supplements
to such Registration Statement and the prospectus used in connection with such
Registration Statement as may be necessary to comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such
Registration Statement for the period provided for in this Agreement.

(c)       Promptly furnish to each Holder of Registrable Securities such numbers
of copies of such Registration Statement, each amendment and supplement thereto,
the

 

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prospectus included in the Registration Statement in conformity with the
requirements of the Securities Act, and such other documents as they may
reasonably request in order to facilitate the disposition of Registrable
Securities owned by them.

(d)       Promptly notify each Holder of Registrable Securities covered by such
Registration Statement at any time when a prospectus relating thereto is
required to be delivered under the Securities Act of: (i) the happening of any
event as a result of which the prospectus included in such Registration
Statement, as then in effect, includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in the light of the circumstances
then existing, (ii) the issuance by the SEC of any stop order suspending the
effectiveness of a Registration Statement or the initiation of any proceedings
for that purpose, and (iii) the receipt by the Company of any notification with
respect to the suspension of the qualification or exemption from qualification
of any of the Registrable Shares for sale in any jurisdiction or the initiation
or threatening of any proceeding for such purpose.

(e)       Use its reasonable best efforts to cause all such Registrable
Securities registered pursuant hereto to be listed on Nasdaq or each securities
exchange on which similar securities issued by the Company are then listed.

(f)        Provide each Holder of Registrable Securities with a reasonable
opportunity to review and comment on the Registration Statement prior to its
filing with the SEC.

(g)       If there has occurred any event as a result of which the prospectus
included in such Registration Statement, as then in effect, includes an untrue
statement of a material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein not misleading in the
light of the circumstances then existing, the Company will use its reasonable
best efforts to prepare and furnish to each Holder a reasonable number of copies
of a supplement or amendment to such prospectus so that, as thereafter delivered
to the purchasers of such Registrable Securities, such prospectus will not
contain an untrue statement of a material fact or omit to state any fact
necessary to make the statements therein not misleading in the light of the
circumstances then existing.

(h)       In the event of the issuance by the SEC of any stop order suspending
the effectiveness of a Registration Statement, or of any order suspending or
preventing the use of any related prospectus or suspending the qualification of
any securities included in the Registration Statement for sale in any
jurisdiction, the Company will use its reasonable best efforts to promptly
obtain the withdrawal of such order.

(i)        Cooperate with each seller of Registrable Securities and their
counsel in connection with any filings required to be made with the National
Association of Securities Dealers.

(j)        Use its reasonable best efforts to register or qualify such
Registrable Securities under such other state securities or blue sky laws as the
selling Holders selling such Registrable Securities reasonably requests and do
any and all other acts and things

 

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which may be reasonably necessary or reasonably advisable to enable such Holder
to consummate the disposition in such jurisdictions of the Registrable
Securities owned by such Holder and to keep each such registration or
qualification (or exemption therefrom) effective during the period which the
Registration Statement is required to be kept effective (provided, that the
Company will not be required to (i) qualify generally to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
subparagraph, (ii) subject itself to taxation in any such jurisdiction or (iii)
consent to general service of process in any such jurisdiction).

(k)       Enter into such customary agreements (including underwriting
agreements containing customary representations and warranties) and take all
other customary and appropriate actions as the Holders of the Registrable
Securities being sold or the managing underwriters, if any, reasonably request
in order to expedite or facilitate the disposition of such Registrable
Securities.

(l)        With respect to an Underwritten Offering pursuant to any Registration
Statement filed under Section 1.2 or Section 1.3, obtain one or more comfort
letters, dated the effective date of the Registration Statement and, if required
by the managing underwriters, dated the date of the closing under the
underwriting agreement, signed by the Company’s independent public accountants
in customary form and covering such matter of the type customarily covered by
comfort letters in similar transactions.

(m)      With respect to an Underwritten Offering pursuant to any Registration
Statement filed under Section 1.2 or Section 1.3, obtain a legal opinion of the
Company’s outside counsel, dated the effective date of such Registration
Statement and, if required by the managing underwriters, dated the date of the
closing under the underwriting agreement, with respect to the Registration
Statement, each amendment and supplement thereto, the prospectus included
therein (including the preliminary prospectus) and such other documents relating
thereto in customary form and covering such matters of the type customarily
covered by legal opinions in similar transactions.

(n)       Take all other steps reasonably necessary to effect the registration
of the Registrable Securities contemplated hereby.

1.6       Furnish Information. It shall be a condition precedent to the
obligations of the Company to take any action pursuant to this Section 1 with
respect to the Registrable Securities of any Holder that such Holder shall
furnish to the Company such information regarding itself, the Registrable
Securities held by it, and the intended method of disposition of such securities
as shall reasonably be required to effect the registration of such Holder’s
Registrable Securities.

1.7       Expenses of Registration. All expenses, other than underwriting
discounts and commissions (“Selling Expenses”), incurred in connection with
registrations, filings or qualifications of Registrable Securities pursuant to
Section 1 for each Holder, including (without limitation) all registration,
filing, and qualification fees, printers’ and accounting fees and fees and
disbursements of counsel for the Company and any other person or entity retained
by the Company, shall be borne by the Company, and the Company will pay its
internal expenses

 

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(including without limitation all salaries and expenses of the Company’s
employees performing legal or accounting duties) and the expenses and fees for
listing or approval for trading of the securities to be registered on each
securities exchange on which similar securities issued by the Company are then
listed or quoted. All Selling Expenses and the fees and disbursements of counsel
for the Holders incurred in connection with any registrations hereunder shall be
borne by the Holders of the securities so registered, pro rata on the basis of
the number of shares so registered. In connection with any Registration
Statement filed hereunder, the Company will pay the reasonable fees and expenses
of a single counsel retained by the Holders of a majority (by number of shares)
of the Registrable Securities requested to be included in such Registration
Statement.

1.8       Underwriting Requirements. In connection with any Underwritten
Offering, the Company shall not be required under Section 1.4 to include any of
the Holders’ securities in such underwriting, unless they accept the terms of
the underwriting as agreed upon between the Company and the underwriters
selected by it (or by other persons entitled to select the underwriters), and
then only in such quantity as the underwriters determine in their sole
discretion will not jeopardize the success of the offering by the Company. If
the total amount of securities, including Registrable Securities, requested by
Stockholders to be included in such offering exceeds an amount that the
underwriters determine in their sole discretion is compatible with the success
of the offering, then the Company shall be required to include in the offering
only that number of such securities, including Registrable Securities, which the
underwriters determine in their sole discretion will not jeopardize the success
of the offering. In such event: (x) in cases initially involving the
registration for sale of securities for the Company’s own account, securities
shall be registered in such offering in the following order of priority: (i)
first, the securities which the Company proposes to register, (ii) second, the
Warrant Shares, and (iii) third, Registrable Securities and securities which
have been requested to be included in such registration by persons entitled to
exercise “piggy-back” registration rights pursuant to contractual commitments of
the Company (pro rata based on the amount of securities sought to be registered
by Holders and such other persons); and (y) in cases not initially involving the
registration for sale of securities for the Company’s own account, securities
shall be registered in such offering in the following order of priority: (i)
first, the securities of any person whose exercise of a “demand” registration
right pursuant to a contractual commitment of the Company is the basis for the
registration, (ii) second, the Warrant Shares, (iii) third, Registrable
Securities and securities which have been requested to be included in such
registration by persons entitled to exercise “piggy-back” registration rights
pursuant to contractual commitments of the Company (pro rata based on the amount
of securities sought to be registered by Holders and such other persons), and
(iv) fourth, the securities which the Company proposes to register.

No Holder may participate in any Underwritten Offering hereunder unless such
Holder (a) agrees to sell such Holder’s securities on the basis provided in any
underwriting arrangements approved by the person or persons entitled hereunder
to approve such arrangements and (b) completes and executes all questionnaires,
powers of attorney, indemnities, underwriting arrangements and other documents
reasonably required under the terms of such underwriting arrangements.

1.9       Delay of Registration. No Holder shall have any right to obtain or
seek an injunction restraining or otherwise delaying any such registration as
the result of any controversy that might arise with respect to the
interpretation or implementation of this Section 1.

 

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1.10     Indemnification. In the event any Registrable Securities are included
in a Registration Statement under this Section 1:

(a)       To the extent permitted by law, the Company will indemnify and hold
harmless each Holder, and its general or limited partners, officers, directors,
members, managers, employees, advisors, representatives, agents and affiliates
(collectively, the “Representatives”), and each underwriter, if any, and each
person, if any, who controls such Holder or underwriter within the meaning of
the Securities Act or the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), against any losses, claims, damages, or liabilities (joint or
several) to which they may become subject under the Securities Act, the Exchange
Act or other federal or state law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
of the following statements, omissions or violations (collectively a
“Violation”): (i) any untrue statement or alleged untrue statement of a material
fact contained in such Registration Statement, including any preliminary
prospectus, or final prospectus contained therein or any amendments or
supplements thereto, (ii) the omission or alleged omission to state therein a
material fact required to be stated therein, or necessary to make the statements
therein not misleading, or (iii) any violation or alleged violation by the
Company of the Securities Act, the Exchange Act, or any rule or regulation
promulgated under the Securities Act or the Exchange Act; and the Company will
pay to each such Holder, Representative, underwriter or controlling person, as
incurred, any legal or other expenses reasonably incurred by them in connection
with investigating or defending any such loss, claim, damage, liability or
action; provided, however, that the indemnity agreement contained in this
subsection 1.10(a) shall not apply to amounts paid in settlement of any such
loss, claim, damage, liability or action if such settlement is effected without
the consent of the Company (which consent shall not be unreasonably withheld)
unless the Company shall have failed to pay the legal or other expenses as
incurred in accordance with the foregoing provision, nor shall the Company be
liable to any Holder, Representative, underwriter or controlling person for any
such loss, claim, damage, liability or action to the extent that it arises out
of or is based upon a Violation which occurs in reliance upon and in conformity
with written information furnished expressly for use in connection with such
registration by any such Holder, Representative, underwriter or controlling
person. Each Holder shall be entitled to reimbursement from the Company for any
out-of-pocket losses actually incurred by such Holder to the extent that such
Holder suffers such losses as a result of such Holder’s inability to make
delivery of sold securities due to the Company’s breach of its commitment to
provide timely notice as required by Section 1.5(d).

(b)       To the extent permitted by law, each selling Holder, severally and not
jointly, will indemnify and hold harmless the Company, and its Representatives,
each person, if any, who controls the Company within the meaning of the
Securities Act or the Exchange Act, any underwriter, and any controlling person
of any such underwriter, against any losses, claims, damages or liabilities
(joint or several) to which any of the foregoing persons may become subject,
under the Securities Act, the Exchange Act or other federal or state law,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereto) arise out of or are based upon any Violation, in each case to the
extent (and only to the extent) that such Violation occurs in reliance upon and
in conformity with written information furnished by such Holder expressly for
use in connection with such registration; provided, however, that the indemnity
agreement contained in this subsection 1.10(b) shall not apply to amounts paid
in settlement of any such

 

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loss, claim, damage, liability or action if such settlement is effected without
the consent of such Holder, which consent shall not be unreasonably withheld.
The obligation of each Holder to indemnify the Company and its Representatives
shall be limited to the net proceeds received by such Holder from the sale of
Registrable Securities under such Registration Statement. In no event, however,
shall any Holder be liable for indirect, incidental or consequential or special
damages of any kind.

(c)       Promptly after receipt by an indemnified party under this Section 1.10
of notice of the commencement of any action (including any governmental action),
such indemnified party will, if a claim in respect thereof is to be made against
any indemnifying party under this Section 1.10, deliver to the indemnifying
party a written notice of the commencement thereof and the indemnifying party
shall have the right to participate in, and, to the extent the indemnifying
party so desires, jointly with any other indemnifying party similarly noticed,
to assume the defense thereof with counsel mutually satisfactory to the parties;
provided, however, that an indemnified party (together with all other
indemnified parties which may be represented without conflict by one counsel)
shall have the right to retain one separate counsel, with the reasonable fees
and expenses to be paid by the indemnifying party, if representation of such
indemnified party by the counsel retained by the indemnifying party would be
inappropriate due to actual or potential conflicting interests between such
indemnified party and any other party represented by such counsel in such
proceeding. The failure to deliver written notice to the indemnifying party
within a reasonable time of the commencement of any such action shall relieve
such indemnifying party of liability to the indemnified party under this
Section 1.10 to the extent that the indemnifying party has been prejudiced
thereby.

(d)       If the indemnification provided for in this Section 1.10 is held by a
court of competent jurisdiction to be unavailable to an indemnified party with
respect to any loss, liability, claim, damage or expense referred to therein,
then the indemnifying party, in lieu of indemnifying such indemnified party
hereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such loss, liability, claim, damage, or expense in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party on the one hand and of the indemnified party on the other in connection
with the statements or omissions that resulted in such loss, liability, claim,
damage or expense as well as any other relevant equitable considerations. The
relative fault of the indemnifying party and of the indemnified party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission to state a material fact
relates to information supplied by the indemnifying party or by the indemnified
party and the parties’ relative intent, knowledge, access to information, and
opportunity to correct or prevent such statement or omission.

(e)       The obligations of the Company and the Holders under this Section 1.10
shall survive the completion of any offering of Registrable Securities in a
Registration Statement under this Section 1, and otherwise.

1.11     Assignment of Registration Rights. The rights to cause the Company to
register Registrable Securities pursuant to this Section 1 may be transferred or
assigned by a Holder provided that (i) the Company is furnished with written
notice of the name and address of such transferee or assignee and the securities
with respect to which such registration rights are being assigned; (ii) such
transferee agrees in writing to be subject to all restrictions set forth in

 

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this Agreement as though it were a Holder and shall thereafter be deemed to be a
Holder for all purposes of this Agreement; and (iii) such assignment shall be
effective only if and to the extent immediately following such transfer the
further disposition of such securities by the transferee or assignee is not
eligible to be made without any conditions under Rule 144.

1.12     Additional Stockholder Covenants. Each Holder agrees that, upon receipt
of any notice from the Company of the happening of any event of the kind
described in Section 1.3(i) or Section 1.5(d) hereof, such Holder shall
forthwith discontinue disposition of such Registrable Shares covered by such
Registration Statement or prospectus until such Holder’s receipt of the copies
of the supplemented or amended prospectus contemplated by Section 1.5(g) hereof,
or until it is advised in writing (the “Advice”) by the Company that the use of
the applicable prospectus may be resumed, and has received copies of any amended
or supplemented prospectus or any additional or supplemental filings which are
incorporated, or deemed to be incorporated, by reference in such prospectus and,
if requested by the Company, such Holder shall deliver to the Company (at the
expense of the Company) all copies, other than permanent file copies then in
such Holder’s possession, of the prospectus covering such Registrable Shares at
the time of receipt of such request. Each Holder further agrees not to utilize
any material other than the applicable current prospectus in connection with the
offering of Registrable Shares pursuant to this Agreement.

1.13     Termination of Registration Rights. All registration rights granted
under this Agreement with respect to a Holder shall terminate and be of no
further force and effect when such Holder no longer beneficially owns any
Registrable Securities.

 

2.

ADDITIONAL COMPANY OBLIGATIONS.

2.1       Current Public Information. The Company covenants that it will use its
reasonable best efforts to timely file all reports required to be filed by it
under the Exchange Act, and will use its reasonable best efforts to take such
further action as a Holder may reasonably request, all to the extent required to
enable the Holders of Registrable Securities to sell Registrable Securities
pursuant to Rule 144. The Company shall, upon the request of a Holder, deliver
to such Holder a written statement as to whether it has complied with such
requirements during the twelve (12) month period immediately preceding the date
of such request.

 

3.

MISCELLANEOUS.

3.1       Successors and Assigns. Except as otherwise provided in this
Agreement, the terms and conditions of this Agreement shall inure to the benefit
of and be binding upon the respective permitted successors and permitted assigns
of the parties. Nothing in this Agreement, express or implied, is intended to
confer upon any party other than the parties hereto or their respective
successors and assigns any rights, remedies, obligations, or liabilities under
or by reason of this Agreement, except as expressly provided in this Agreement.

3.2       Amendments and Waivers. Any term of this Agreement may be amended or
waived with the written consent of the Company, the Majority Holders of the
Registrable Securities and the Majority Holders of the Warrant Shares; provided,
however, that the consent of the Majority Holders of the Warrant Shares shall
not be required with respect to

 

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matters that would not materially affect any Holder of the Warrant Shares. Any
amendment or waiver effected in accordance with this paragraph shall be binding
upon each Holder and its permitted successors and assigns.

3.3       Notices. All notices, consents, waivers and other communications under
this Agreement must be in writing (which shall include telecopier or electronic
communication) and will be deemed to have been duly given if delivered by hand
or by nationally recognized overnight delivery service (receipt requested), or
by telecopy if confirmed by receipted overnight delivery service, if to a
Holder, at the address listed on the signature page hereto or the most current
address given by such Holder to the Company by means of a notice given in
accordance with the provisions of this Section 3.3, and if to the Company, as
follows:

 

 

Company:

Patrick Industries, Inc.

107 West Franklin Street

Elkhart, Indiana 46516

Attention: Andy Nemeth

 

Telephone:

(574) 294-7511

 

Telecopy:

(574) 522-5213

Email: nemetha@patrickind.com

 

 

with a copy to:

McDermott Will and Emery LLP

227 West Monroe Street

Chicago, Illinois 60606-5096

Attention: Robert A. Schreck, Jr.

 

Telephone:

(312) 984-7582

 

Telecopy:

(312) 984-7700

Email: rschreck@mwe.com

 

Except as otherwise provided herein, all such notices, consents, waivers and
other communications shall be effective: (a) if delivered by hand, when
delivered; (b)  if delivered by overnight express delivery service, on the next
business day after deposit with such service; and (c) if by telecopier or
electronic mail, on the next business day of transmission if also confirmed by
mail in the manner provided in this Section.

3.4       Severability. If any term, provision, covenant or restriction of this
Agreement is held by any governmental authority or a court of competent
jurisdiction to be invalid, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions of this Agreement shall remain in full
force and effect and shall in no way be affected, impaired or invalidated.

3.5       Governing Law. This Agreement shall be governed in all respects,
including validity, interpretation and effect, by the internal laws of the State
of Indiana, without regard to the principles of conflict of laws. Any disputes
arising out of or in connection with this Agreement shall be adjudicated in a
United States District Court in Indiana or in a court of competent civil
jurisdiction in the State of Indiana. Each party hereto irrevocably submits to
the personal jurisdiction of such courts for the purposes of any such suit,
action, counterclaim or

 

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proceeding arising out of this Agreement (collectively, a Suit). Each of the
parties hereto hereby waives and agrees not to assert by way of motion, as a
defense or otherwise in any such Suit, that such Suit is brought in an
inconvenient forum, or the venue of such Suit is improper; provided, however,
that nothing herein shall be construed as a waiver of any right that any party
hereto may have to remove a Suit from a court sitting in the State of Indiana to
a United States District Court in Indiana. Each of the parties hereby agrees
that service of all writs, process and summonses in any Suit may be made upon
such party by mail to the address as provided in this Agreement. Nothing herein
shall in anyway be deemed to limit the ability of any party to serve any such
writs, process or summonses in any other matter permitted by applicable law.

3.6       Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

3.7       Entire Agreement. This Agreement and the documents and agreements
referred to herein constitute the entire agreement between the parties hereto
pertaining to the subject matter hereof and supersede any and all other written
or oral agreements existing between the parties hereto, which agreements are
expressly canceled.

3.8       No Inconsistent Agreements. The Company has not and shall not enter
into any agreement with respect to its securities that is inconsistent with the
rights granted to the Holders in this Agreement.

3.9       Titles and Subtitles. The titles and subtitles used in this Agreement
are used for convenience only and are not to be considered in construing or
interpreting this Agreement.

 

[SIGNATURE PAGE FOLLOWS]

 

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The parties hereto have executed this Second Amended and Restated Registration
Rights Agreement as of the date first written above.

 

PATRICK INDUSTRIES, INC.

 

By:       /s/ Andy L. Nemeth

Andy L. Nemeth, Executive Vice President - Finance

 

 

TONTINE CAPITAL PARTNERS, L.P.

 

 

By:

Tontine Capital Management, LLC, its general partner

 

 By:       /s/ Jeffrey L. Gendell

Jeffrey L. Gendell, as managing member

 

55 Railroad Avenue, 1st Floor

Greenwich, Connecticut, 06830

Telephone: (203) 769-2000

Telecopy: (203) 769-2010

Email: jgendell@tontinepartners.com

 

TONTINE CAPITAL OVERSEAS MASTER FUND, L.P.

 

 

By:

Tontine Capital Overseas GP, L.L.C., its general partner

 

By:       /s/ Jeffrey L. Gendell

Jeffrey L. Gendell, as managing member

 

55 Railroad Avenue, 1st Floor

Greenwich, Connecticut, 06830

Telephone: (203) 769-2000

Telecopy: (203) 769-2010

Email: jgendell@tontinepartners.com

 

 

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JPMORGAN CHASE BANK, N.A.

 

By /s/ Michael E. Lewis

 

Name: Michael E. Lewis

 

1 East Ohio Street, 4th Floor

Indianapolis, IN 46204

Attn: Michael Lewis

Telephone: (317) 767-8428

Telecopy: (317) 767-8015

Email: michael.e.lewis@chase.com

 

FIFTH THIRD BANK

By /s/ Craig Ellis 

 

Name: Craig Ellis

 

Maildrop G25511

222 South Riverside Plaza

Chicago, IL 60606

Attn: Craig Ellis

Telephone: (574) 293-6425

Telecopy: (574) 522-3712

Email: craig.ellis@53.com

 

BANK OF AMERICA, N.A., as successor to LaSalle Bank National Association

By /s/ Thomas J. Flanagan, II 

 

Name: Thomas J. Flanagan, II
Senior Vice President

30 South Meridian Street #800

Indianapolis, IN 46204

Attn: Shawn Bush

Telephone: (317) 916-2234

Telecopy: (317) 756-7021

Email: shawn.bush@bankofamerica.com

 

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KEY BANK, NATIONAL ASSOCIATION

By /s/ Geoffrey R. Henry 

 

Name: Geoffrey R. Henry

 

101 S. Main Street

Elkhart, IN 46516

Attn: Geoffrey Henry

Telephone: (574) 295-2682

Telecopy: (574) 295-2703

Email: geoffrey_henry@keybank.com

 

RBS CITIZENS, NATIONAL ASSOCIATION, as successor by merger with Charter One Bank

 

By /s/ Peter Coates 

 

Name: Peter Coates

 

53 State Street, 9th Floor

Boston, MA 02109

Attn: Peter Coates

Telephone: (617) 994-7250

Telecopy: (617) 742-9471

Email: peter.coates@rbsbusinesscapital.com

 

ASSOCIATED BANK

By /s/ Viktor R. Gottlieb 

 

Name: Viktor R. Gottlieb

 

401 E Kilbourn Avenue

Milwaukee, WI 53202

Attn: Viktor Gottlieb

Telephone: (414) 283-2226

Telecopy: (414) 283-2300

Email: viktor.gottlieb@associatedbank.com

 

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NATIONAL CITY BANK

By /s/ Josh Stehlin 

Name:   Josh Stehlin

310 West McKinley Avenue

Mishawaka, IN 46545

 

 

Telephone: (574)

850-6065

 

Telecopy: (574)

256-6014

Email: josh.stehlin@nationalcity.com

 

1ST SOURCE BANK

By /s/ Jeff Buhr 

 

Name: Jeff Buhr

 

100 N. Michigan

PO Box 1602

South Bend, IN 46634

Attn: Judd McNally

Telephone: (574) 235-2416

Telecopy: (574) 235-2719

Email: mcnallyj@1stsource.com

 

 

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