THIRD AMENDMENT AND WAIVER  

THIS THIRD AMENDMENT AND WAIVER dated as of April 14, 2009 (this “Amendment”)
amends the Credit Agreement dated as of May 18, 2007 (as amended, the “Credit
Agreement”) among PATRICK INDUSTRIES, INC., an Indiana corporation (the
“Borrower”), the LENDERS party thereto and JPMORGAN CHASE BANK, N.A., as
Administrative Agent (in such capacity, the “Administrative Agent”). Capitalized
terms used but not defined herein have the respective meanings given to them in
the Credit Agreement.

WHEREAS, the Borrower has requested certain amendments to, and waivers under,
the Credit Agreement.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:

SECTION 1.   AMENDMENTS. Subject to the conditions precedent set forth in
Section 4, the Credit Agreement is amended as follows:

 

 

1.1

Amendments to Definitions in Section 1.1.

1.1.1    The definitions of Consolidated EBITDA and Restructuring Charges are
amended in their entirety to read as follows respectively:

“Consolidated EBITDA” means, for any period, the sum (without duplication) of
(a) Consolidated Net Income for such period plus (b) to the extent deducted in
determining such Consolidated Net Income, Interest Expense, income tax expense,
depreciation, amortization and Restructuring Charges plus (c) losses in
connection with discontinued operations during such period to the extent
approved in writing by the Administrative Agent (which approval shall not be
unreasonably withheld) minus (d) gains in connection with discontinued
operations during such period.

“Restructuring Charges” means non-recurring restructuring charges taken after
December 31, 2008 that are approved in writing by the Administrative Agent
(which approval shall not be unreasonably withheld).

1.2       Amendment to Section 2.11. Section 2.11(c) is amended in its entirety
to read as follows:

(c)       Not later than five Business Days following the receipt of any Net
Cash Proceeds of any Asset Disposition by the Borrower or any Subsidiary, the
Borrower shall prepay the Term Loans (and, after the Term Loans have been paid
in full, prepay Revolving Loans) in an amount (rounded down, if necessary, to an
integral multiple of $100,000) equal to the excess of (x) all Net Cash Proceeds
of Asset Dispositions (excluding, so long as no Default exists at the time of
such sale, any Net Cash Proceeds attributable to inventory and receivables)
received on

 

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or after the date of this Agreement over (y) the amount of Net Cash Proceeds of
Asset Dispositions previously applied to prepay Loans pursuant to this clause
(c).

1.3       Amendment to Section 5.1(g) and (h). Each of Sections 5.1(g) and (h)
is amended by deleting each references to “month” therein and replacing it with
“fiscal month.”

1.4       Amendment to Section 5.10. Section 5.10 is amended by adding the
following clause (d) at the end thereof:

(d)       Not later that 60 days after the effectiveness of the Third Amendment
to this Agreement, deliver to the Administrative Agent an appraisal, in form
satisfactory to the Administrative Agent, of each parcel of real estate owned by
the Company or any Subsidiary, in each case prepared by an appraiser reasonable
satisfactory to the Administrative Agent.

1.5       Amendment to Section 6.8(a). Section 6.8(a) is amended by deleting
each references to “month” therein and replacing it with “fiscal month.”

1.6       Amendment to Schedules. Schedule 1.1(b), Schedule 2.1 and Schedule 6.8
to the Credit Agreement are deleted and replaced with Schedule 1.1(b), Schedule
2.1 and Schedule 6.8 hereto, respectively.

SECTION 2.   WAIVER. Subject to the conditions precedent set forth in Section 4,
the Required Lenders waive any Event of Default resulting from (i) the
Borrower’s actual or potential non-compliance with Section 6.8 of the Credit
Agreement for the fiscal months of the Borrower ended March 1, 2009 and March
29, 2009 and (ii) the delivery of certificates required under Section 5.1(g) of
the Credit Agreement for the fiscal months ended January 25, 2009 and March 1,
2009 by the date due.

SECTION 3.   REPRESENTATIONS AND WARRANTIES. The Borrower represents and
warrants to the Administrative Agent and the Lenders that after giving effect to
this Amendment: (a) the representations and warranties of the Borrower set forth
in the Credit Agreement are true and correct in all material respects (except to
the extent stated to relate to an earlier date, in which case such
representations and warranties were true and correct in all material respects as
of such earlier date); and (b) no Default will exist.

SECTION 4.   CONDITIONS PRECEDENT. This Amendment shall become effective on the
date on which the Administrative Agent shall have received the following:

(a)       Counterparts of this Amendment signed by the Borrower and the Required
Lenders.

(b)       A Confirmation substantially in the form of Exhibit A signed by each
Loan Party.

(c)       Payment of all invoiced fees and expenses of the Administrative Agent
(including reasonable attorneys’ fees and expenses) in connection herewith.

 

 

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(d)       An amendment fee for each Lender that delivers a signed counterpart to
this Amendment to the Administrative Agent, prior to 12:00 p.m. (Chicago time)
on April 13, 2009, in an amount equal to the product of 0.25% multiplied by the
sum of (i) such Lender’s Revolving Commitment (as reduced by this Amendment) and
(ii) the outstanding principal amount of such Lender’s Term Loans.

 

SECTION 5.

MISCELLANEOUS.

5.1       Continuing Effectiveness, etc. After giving effect to this Amendment,
the Credit Agreement shall remain in full force and effect and is hereby
ratified, approved and confirmed in each and every respect. After the
effectiveness hereof, all references to the Credit Agreement in any Loan
Document shall be deemed to refer to the Credit Agreement as amended hereby. The
waivers contained in Section 2 are limited to the matters specifically set forth
therein and shall not be deemed to constitute a waiver or amendment with respect
to any other matter whatsoever.

5.2       Incorporation of Credit Agreement Provisions. The provisions of
Sections 1.3 (Terms Generally), 9.7 (Severability), 9.10 (Waiver of Jury Trial)
and 9.11 (Headings) of the Credit Agreement are incorporated by reference as if
fully set forth herein, mutatis mutandis.

5.3       Signing in Counterparts. This Amendment may be signed by the parties
hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement. A
signature hereto delivered by facsimile or in .pdf format shall be effective as
delivery of an original counterpart.

5.4       Governing Law. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH
AND GOVERNED BY THE LAWS OF THE STATE OF ILLINOIS.

5.5       Successors and Assigns. This Amendment shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
permitted assigns.

5.6       Reduction of Commitments. Concurrently with the effectiveness of this
Amendment, the Revolving Commitments shall be reduced by $5,000,000 (such
reduction to be applied ratably to the respective Revolving Commitments of the
Lenders in accordance with their Revolving Percentages).

[Remainder Of Page Intentionally Left Blank]

 

 

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            IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be signed by their respective officers thereunto duly authorized as of the day
and year first above written.

 

PATRICK INDUSTRIES, INC.

 

By /s/ Andy L. Nemeth

 

Name: Andy L. Nemeth

 

Title: Executive Vice President - Finance

 

JPMORGAN CHASE BANK, N.A., individually and as Administrative Agent

 

By /s/ Michael E. Lewis

 

Name: Michael E. Lewis

 

Title: Senior Vice President

 

FIFTH THIRD BANK

 

By /s/ David R. Garcia

 

Name: David R. Garcia

 

Title: Vice President

 

 

 

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

 

By /s/ Scott W. Vokey

 

Name: Scott W. Vokey

 

Title: Senior Vice President

 

 

 

KEY BANK, NATIONAL ASSOCIATION

 

By /s/ Ryan J. Watkins

 

Name: Ryan J. Watkins

 

Title: Vice President

 

 

 

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

 

By /s/ Thomas F. Thompson

 

Name: Thomas F. Thompson

 

Title: Vice President

 

 

 

ASSOCIATED BANK

 

By /s/ Michael A. McPeek

 

Name: Michael A. McPeek

 

Title: Senior Vice President

 

 

 

NATIONAL CITY BANK

 

By_______________________________________

 

Name:

 

Title:

 

 

 

1ST SOURCE BANK

 

By /s/ Jeff Baker

 

Name: Jeff Baker

 

Title: Senior Vice President

 

 

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SCHEDULE 1.1(b)

 

BORROWING BASE AMOUNTS

 

Period

Amount

 

January 1, 2009 - April 30, 2009

 

$25,000,000

 

May 1, 2009 - May 31, 2009

 

$27,000,000

 

June 1, 2009 - June 30, 2009

 

$26,000,000

 

July 1, 2009 – July 31, 2009

 

$27,000,000

 

August 1, 2009 – August 31, 2009

 

$29,000,000

 

September 1, 2009 - September 30, 2009

 

$27,000,000

 

October 1, 2009 - October 31, 2009

 

$26,000,000

 

November1, 2009 – December 31, 2009

 

$25,000,000

 

January 1, 2010 - January 31, 2010

 

$19,000,000

 

February 1, 2010 - March 31,2010

 

$23,000,000

 

April 1, 2010 - June 30, 2010

 

$25,000,000

 

July 1, 2010 - August 31, 2010

 

$28,000,000

 

September 1, 2010 - October 31, 2010

 

$23,000,000

 

November 1, 2010 - November 30, 2010

 

$21,000,000

 

December 1, 2010 - December 31, 2010

 

$19,000,000

 

 

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SCHEDULE 2.1

COMMITMENTS

 

Bank

Revolver

Commitment

Term Loan

Commitment

Total

Commitment

 

 

 

 

JPMorgan Chase Bank, N.A

$5,454,545.44

$6,515,535.42

$11,970,080.86

Fifth Third Bank

$4,909,090.91

$5,863,981.81

$10,773,072.72

Bank of America, N.A

$4,431,818.19

$5,293,872.46

$ 9,725,690.65

Key Bank, National Association

$4,431,818.19

$5,293,872.46

$ 9,725,690.65

RBS Citizens, National Association

$4,431,818.19

$5,293,872.46

$ 9,725,690.65

Associated Bank

$3,613,636.36

$4,316,542.16

$ 7,930,178.52

National City Bank

$1,363,636.36

$1,628,883.83

$ 2,992,520.19

1st Source Bank

$1,363,636.36

$1,628,883.83

$ 2,992,520.19

Total

$30,000,000.00

$35,835,444.43

$65.835,444.43

 

 

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SCHEDULE 6.8

 

CONSOLIDATED EBITDA

Fiscal Month
(ended on or closest to)

Fiscal month then ending

Fiscal two months then ending

 

March 29,2009

 

N/A

 

N/A

 

April 26, 2009

 

N/A

 

N/A

 

May 31, 2009

 

N/A

 

N/A

 

June 28, 2009

 

$279,300

 

N/A

 

July 26, 2009

 

$189,700

 

$797,300

 

August 30, 2009

 

$785,100

 

$1,657,100

 

September 27, 2009

 

$648,800

 

$2,437,600

 

October 25, 2009

 

$466,500

 

$1,896,000

 

November 29, 2009

 

$404,300

 

$1,480,300

 

December 31, 2009

 

($206,200)

 

$570,400

 

January 31, 2010

 

($1,215,750)

 

($1,090,200)

 

February 28, 2010

 

$527,850

 

$208,420

 

March 31,2010

 

$396,250

 

$1,570,970

 

April 30, 2010

 

$549,000

 

$1,606,925

 

May 31, 2010

 

$797,250

 

$2,288,625

 

June 30, 2010

 

$358,200

 

$1,964,270

 

July 31, 2010

 

$152,000

 

$867,340

 

August 31, 2010

 

$1,092,400

 

$2,115,480

 

September 30, 2010

 

$597,900

 

$2,873,510

 

October 31, 2010

 

$635,500

 

$2,096,780

 

November 30, 2010

 

$284,350

 

$1,563,745

 

December 31, 2010

 

($288,600)

 

$319,855

 

 

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EXHIBIT A

 

FORM OF CONFIRMATION

 

April 14, 2009

 

To:

JPMorgan Chase Bank, N.A., individually and as Administrative

 

Agent, and the other financial institutions that are

 

parties to the Credit Agreement referred to below

 

Please refer to the Third Amendment and Waiver dated as of the date hereof (the
“Amendment”) to the Credit Agreement dated as of May 18, 2007 (the “Credit
Agreement”) among Patrick Industries, Inc., an Indiana corporation, the Lenders
party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent.
Capitalized terms used but not otherwise defined herein have the respective
meanings given to them in the Credit Agreement.

Each of the undersigned hereby confirms to the Administrative Agent and the
Lenders that such undersigned has received a copy of the Amendment and that,
after giving effect to the Amendment and the transactions contemplated thereby,
each Loan Document to which such undersigned is a party continues in full force
and effect and is the legal, valid and binding obligation of such undersigned,
enforceable against such undersigned in accordance with its terms. 

 

PATRICK INDUSTRIES, INC.

 

 

By:

/s/ Andy L. Nemeth

 

Andy L. Nemeth

 

Executive Vice President - Finance

 

 

ADORN HOLDINGS, INC.

 

 

By:

/s/ Andy L. Nemeth

 

Andy L. Nemeth

 

Treasurer and Secretary

 

 

ADORN, LLC

 

 

By:

/s/ Andy L. Nemeth

 

Andy L. Nemeth

 

Treasurer and Secretary