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Exhibit 10.7

 PATRICK INDUSTRIES, INC.

 NOTICE OF ____ TIME BASED RESTRICTED SHARE AWARD AND PERFORMANCE CONTINGENT
RESTRICTED SHARE AWARD

Name of Employee (“Employee”): ______________
 
You have been granted a Time Based Restricted Share Award and a Performance
Contingent Restricted Share Award (collectively the “____ Award”) as follows:

 
I. 
Time Based Restricted Share Award (“Time-Based Shares”)

 
Time-Based Share Grant Date: ____________
 
Time Based Shares Granted: ____ shares of Common Stock (“Shares”), without par
value of Patrick Industries, Inc., an Indiana corporation (the “Company”)

Time-Based Shares Vesting Schedule: The Restrictions (as defined in Article 2 of
the Agreement) relating to the Time-Based Shares shall lapse on the third
anniversary of the Time-Based Share Grant Date, provided that Employee remains
in the continuous employment of the Company or a subsidiary at all times through
the vesting date.

 
II. 
Performance Contingent Restricted Share Award (“Performance Shares”)

 
Performance Share Grant Date: ________
 
Performance Shares Granted:  _______ Shares
 
Performance Shares Vesting Schedule: The Restrictions (as defined in Article 2
of the Agreement) relating to the Performance Shares shall lapse upon receipt of
final audited results for the period ended December 31, 20XX the “Performance
Period Ending Date”), provided that (1) Employee remains in the continuous
employment of the Company or a subsidiary at all times from January 1, 2012 (the
“Performance Period Begin Date”) through the Performance Period Ending Date and
(2) the actual number of Performance Shares that shall vest will range from 0%
to 100%, with the actual amount to be determined based on the Company’s
achievement of the EBITDA Performance for the period January 1, 201X to December
31, 201X established in the 201X Long-Term Incentive - Executive Compensation
Statement set out in Attachment A hereto.  For these purposes, EBIDTA
Performance shall be based on the Company’s cumulative earnings before interest,
taxes, depreciation and amortization (“EBITDA”), as defined in the Company’s
credit agreement over the three year period ending December 31, 201X.
 
The Employee and the Company hereby agree that these awards are granted under
and governed by the terms and conditions of the 201X Time Based Restricted Share
Award and Performance Contingent Restricted Share Award (the “Agreement”), which
is attached hereto and made an integral part hereof, and the Patrick Industries,
Inc. Omnibus Incentive Plan (the “Plan”).  The Company and Employee each agree
to be bound by all of the terms and conditions set forth in the Plan and in the
Agreement.

Patrick Industries,
Inc.                                                                Employee
 
By:_______________________                                            _______________________

Its:_______________________

 
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PATRICK INDUSTRIES, INC.

2012 TIME BASED RESTRICTED SHARE AWARD AND PERFORMANCE CONTINGENT RESTRICTED
SHARE AWARD

In consideration of the premises, mutual covenants and agreements herein, the
Company and the Employee hereby agree as follows:

ARTICLE 1
AWARD

Section 1.1  Award of Restricted Shares.  Subject to all of the terms and
conditions set forth in this 2012 Time Based Restricted Share Award and
Performance Contingent Restricted Share Award (the “Agreement”), the Company
hereby grants to Employee pursuant to the Employee’s Notice of 201X Time Based
Restricted Share Award and Performance Contingent Restricted Share Award (the
“Notice”) (i) the Time Based Shares and (ii) the Performance Shares.  The Time
Based Shares and the Performance Shares are hereinafter referred to collectively
as the “Restricted Shares.”

Section 1.2 Conditions to Award of Restricted Shares.  The award of all
Restricted Shares to Employee is conditioned upon Employee, concurrently with
the execution of this Agreement, delivering to the Company:  (1) if requested by
the Company, a duly signed stock power, endorsed in blank, relating to the
Restricted Shares as required under Section 2.7 hereof, (2) a duly signed
Section 83(b) Election, but only if the Employee, in his or her sole discretion,
intends to make such election, and (3) such other documents or agreements as the
Company may request.

Section 1.3  Voting and Other Rights.  Upon Employee’s timely compliance with
each of the conditions set forth in Section 1.2 hereof, Employee shall have all
of the rights and status as a shareholder of the Company in respect of all of
the Restricted Shares, including the right to vote such shares and to receive
dividends or other distributions thereon.  Any cash dividends paid on any
Restricted Shares shall be paid to the Employee.  In the event any non-cash
dividends or other distributions, whether in property, or stock of another
company, are paid on any Restricted Shares, such non-cash dividends or other
distributions payable to the Employee shall be retained by the Company and not
delivered to the Employee unless and until such time as the Restrictions on the
Restricted Shares with respect to which such non-cash dividends or other
distributions have been paid shall have lapsed and such shares shall have become
Vested Shares (as defined in Section 2.2 hereof).  Such non-cash dividends or
distributions with respect to all of the Restricted Shares shall be retained by
the Company in the event the Restricted Shares on which such non-cash dividends
or other distributions were paid are forfeited to the Company under Section
2.1(b) hereof.

Section 1.4  Subject to Plan.  This Agreement is subject to all of the terms and
conditions of the Patrick Industries, Inc. Omnibus Incentive Plan (the “Plan”),
as the same may be further
 
 
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amended from time to time.  Any capitalized terms not otherwise defined in this
Agreement shall have the meaning set forth in the Plan.
 
ARTICLE 2
RESTRICTIONS

Section 2.1  Restrictions. The Restricted Shares are being awarded to Employee
subject to the following transfer and forfeiture restrictions (collectively, the
“Restrictions”).

(a)  Transfer.  Prior to the date that the Restricted Shares become Vested
Shares, Employee may not directly or indirectly, by operation of law or
otherwise, voluntarily or involuntarily, anticipate, alienate, attach, sell,
assign, pledge, encumber, charge or otherwise transfer all or any part of the
Restricted Shares without the written consent of the Company, which consent may
be withheld by the Company in its sole discretion.

(b)  Forfeiture.  Upon termination of Employee’s employment with the Company or
any Subsidiary, all Restricted Shares which are not Vested Shares (or have not
become Vested Shares under Section 2.3 hereof) at the effective time of such
termination, shall immediately thereafter be returned to or canceled by the
Company in the case of Restricted Shares, and shall be deemed to have been
forfeited by Employee to the Company, unless such designation is made otherwise
by the Board of Directors of the Company, at their sole discretion.  Upon any
forfeiture of Restricted Shares under this Section 2.1, the Company will not be
obligated to pay Employee any consideration whatsoever for the forfeited
Restricted Shares.

Section 2.2  Lapse of Restrictions.  Subject to the other terms of this
Agreement, the Restrictions shall lapse with respect to the Restricted Shares
awarded hereunder only at the time or times and as to that number of Restricted
Shares determined in accordance with the relevant Vesting Schedules set forth in
the Notice.  To the extent the Restrictions shall have lapsed with respect to
Restricted Shares subject to this Award, those shares (the “Vested Shares”) will
thereafter be free of the terms and conditions of this Agreement.

Section 2.3  Acceleration of Vesting.

(a)  Time Based Shares.  Notwithstanding the vesting schedule set forth in the
Notice, the Restrictions shall lapse with respect to any Time Based  Shares that
have not otherwise vested as of the termination of the Employee’s employment
with the Company or any Subsidiary if such termination is by reason of a
termination by the Company without Cause, or a termination by reason of the
Employee’s death or Disability (as those terms are defined below), and such
shares shall not be subject to forfeiture under Section 2.1(b).

(b)  Performance Shares.  Notwithstanding the vesting requirements set out in
the Notice relating to the Performance Shares, if the Employee’s employment with
the Company or any Subsidiary is terminated prior to the Performance Period
Ending Date by reason of a termination by the Company without Cause, or a
termination by reason of the Employee’s death
 
 
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or Disability (as those terms are defined below), Employee will be deemed to
have satisfied the requirement that Employee remain in the continuous employment
of the Company or a subsidiary through the Performance Period Ending Date, but
such Performance Shares shall continue to be subject to the performance criteria
set out in the Notice.  In the event of a termination of employment described in
the preceding sentence, the actual number of Performance Shares that shall vest
shall be determined based on the level of the Company’s achievement of the
specified performance for the performance period ending with the Performance
Period Ending Date as set out in Attachment A to the Notice.

Section 2.4  Termination of Vesting.  In the event the Employee’s employment
with the Company (or any other employment, consulting, advisory or service
relationship or arrangement with the Company or any Subsidiary (as defined
below)) is terminated for any reason, after taking into account the provisions
of Section 2.3 hereof, (1) no further vesting (pro rata or otherwise) of any
Restricted Shares shall occur after the occurrence of such event.

Section 2.5  Withholding Taxes.

(a)  The award of the Restricted Shares to the Employee, and the lapse of
Restrictions on the Restricted Shares, shall be conditioned on any applicable
federal, state or local withholding taxes having been paid by Employee at the
appropriate time pursuant to a direct payment of cash or other readily available
funds to the Company.

(b)  If the Employee shall have elected to file a Section 83(b) Election with
respect to the award of Restricted Shares hereunder, the award of the Restricted
Shares shall be conditioned on the Employee providing the Company with a direct
payment of cash or other immediately available funds in an amount equal to the
statutory minimum withholding taxes required to by withheld by the Company not
later than 30 days after the date of the award.

(c)  Unless the Employee shall have elected to file a Section 83(b) Election
pursuant to Section 2.5(b), above, Employee shall have the right to satisfy all
or any portion of his or her obligations under Section 2.5(a) by having the
Company withhold from the Restricted Shares with respect to which the
Restrictions will lapse, that number of shares of Common Stock having an
aggregate Fair Market Value, determined as of the date of the taxable event with
respect to such shares, equal to the federal, state or local taxes required to
be withheld by the Company with respect to such taxable event; provided however,
that the Fair Market Value of any shares of Common Stock withheld under this
Section 2.5(c) may not exceed the statutory minimum withholding amount required
by law.

Section 2.6  Issuance of Shares; Restrictive Legend.  Stock certificates in
respect of the Restricted Shares may be issued by the Company subject to
Employee’s fulfillment of the conditions set forth in Section 1.2 hereof.  Any
such certificates shall be registered in Employee’s name and shall be inscribed
with a legend evidencing the Restrictions, and such additional legends as may be
required to comply with the Securities Act of 1933, as amended, and other
applicable federal or state securities laws.  Alternatively, the Company may
issue Restricted Shares hereunder in uncertificated form.
 
 
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Section 2.7 Custody.  All certificates representing the Restricted Shares (other
than Vested Shares) shall be deposited, together with stock powers executed by
Employee, in proper form for transfer, with the Company or the Company’s
transfer agent.  If requested, the Company shall provide Employee with a copy of
any certificate representing the Restricted Shares, or such other evidence
thereof as may be determined by the Company, which shall contain the legends
described in Section 2.6.  The Company is hereby authorized to cause the
transfer into its name of the Restricted Shares (and any non-cash distributions
or other property described in Section 1.3 hereof) which are forfeited to the
Company pursuant to Section 2.1(b) hereof.  At the request of Employee,
certificates representing Vested Shares shall, subject to any applicable
securities law restrictions, be delivered by the Company to Employee or
Employee’s personal representative.  Certificates representing shares that have
become Vested Shares in accordance with Section 2.2, 2.3 or 3.1 shall be issued
without the legend evidencing the Restrictions, but may contain such legends as
may be required to comply with the Securities Act of 1933, as amended, or any
other applicable federal or state securities laws.

ARTICLE 3
CHANGE IN CONTROL; ADJUSTMENTS

Section 3.1  Consequences of a Change in Control.  In the event of a Change in
Control of the Company, any Time Based  Shares then held by Employee shall
become Vested Shares, notwithstanding the Vesting Schedule prescribed under
Section 2.2 hereof, as of the effective date of such Change in Control.  In
addition, in the event of a Change in Control of the Company, (a) the
Performance Shares shall become Vested Shares as of the effective date of such
Change in Control based on the assumption that the targeted amount of EBITDA
Performance set out in Attachment A to the Notice shall have been achieved and
based on the fair market value of the Company’s shares as reasonably determined
by the Board of Directors.

Section 3.2  Change in Control.  For purposes of this Agreement, a “Change In
Control” shall be deemed to have occurred if:

(i) any “person” (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934 (the “Exchange Act”)), other than the Company or
an employee benefit plan sponsored by the Company, becomes the “beneficial
owner” (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company representing twenty percent (20%), or
more (or if a person is permitted to own a higher percentage under the Company’s
Rights Agreement, dated March 31, 2006, as the same may be amended from time to
time, such higher percentage as to such person and their affiliates and
associates) of the combined voting power of the Company’s then outstanding
securities ordinarily having the right to vote at elections of directors
(excluding an acquisition of such securities directly from the Company),

(ii) during any period of two consecutive years individuals who at the beginning
of the two-year period were members of the Board cease for any reason to
constitute at least a majority of the Board (individuals with such two years of
service being the “Continuing Directors”),

 
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(iii) there shall be consummated (A) any consolidation, merger or reorganization
of the Company in which the capital stock of the Company is not converted into
or exchanged for cash, securities or other property, other than a consolidation,
merger, or reorganization of the Company in which the holders of capital stock
of all classes of the Company (including Common Stock) immediately prior to the
transaction have, directly or indirectly, an ownership interest in securities
representing a majority of the combined voting power of the outstanding voting
securities of the surviving entity immediately after the transaction, or (B) any
sale, lease, exchange or other transfer (in one transaction or a series of
related transactions) of all, or substantially all, of the assets of the
Company, other than any such transaction with entities in which the holders of
the Company’s then outstanding capital stock of all classes, directly or
indirectly, have an ownership interest in securities representing a majority of
the combined voting power of the outstanding voting securities of such entities
immediately after the transaction,

(iv) a change occurs of a nature that would be required to be reported in
response to Item 6(e) of Schedule 14A of Regulation 14A, promulgated under the
Exchange Act or any successor disclosure item, or

(v) the stockholders of the Company approve any plan or proposal for the
liquidation or dissolution of the Company;

provided, however, that any occurrence described in (i) through (iv) approved by
the affirmative vote of a majority of the Continuing Directors, shall not
constitute a Change in Control to the extent so provided by the affirmative vote
of a majority of those Continuing Directors.

Section 3.4  Binding Nature of Adjustments.  Adjustments under Section 15 of the
Plan will be made by the Compensation Committee, whose determination as to what
adjustments, if any, will be made, will be final, binding and conclusive.  No
fractional shares will be issued pursuant to the Award on account of any such
adjustments.  Subject to Section 1.3, the terms “Restricted Shares” and “Vested
Shares” shall include any shares,  securities, or other property that Employee
receives or becomes entitled to receive as a result of Employee’s ownership of
the original Restricted Shares, and any such shares, securities or other
property shall be subject to the same Restrictions and other terms and
conditions that apply with respect to, and shall vest or be forfeited at the
same time as, the Restricted Shares with respect to which such shares,
securities or other property are issued.

ARTICLE 4
DEFINITIONS

Section 4.1  Definitions.  For purposes of this Award, the following terms shall
have the following meanings:

“Cause” shall have the meaning  set out in any separate employment agreement
between the Employee and the Company and, in the absence of an employment
 
 
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agreement, “Cause” shall mean Employee’s:  (a) commission of an act of
dishonesty, fraud, theft, or embezzlement; (b) sabotage or intentional failure
to act on the direction of an officer of the Company or the Board of Directors
of the Company or of any affiliate; (c) engagement, directly or indirectly, in a
business or occupation (as a proprietor, partner, officer, shareholder, or
employee, or otherwise) in competition with the Company or any of its
affiliates; (d) indictment or conviction for a felony violation of a criminal
law, other than motor vehicle offenses; (e) the use or possession of illegal
drugs; or (f) failure to achieve and/or perform, to the Company’s satisfaction,
Employee’s duties and responsibilities on behalf of the Company (other than due
to Disability).

“Disability” shall have the meaning ascribed to such term in Section 22(e)(3) of
the Internal Revenue Code of 1986, as amended, or any successor provision.

“Section 83(b) Election” shall mean an election made pursuant to Section 83(b)
of the Internal Revenue Code of 1986, as amended, to be taxed with respect to
the Restricted Shares at the time of grant rather than upon the lapse of the
Restrictions.

“Subsidiary” or “Subsidiaries” shall mean any corporation or other entity of
which outstanding shares or ownership interests representing 50% or more of the
combined voting power of such corporation or other entity entitled to elect the
management thereof, or such lesser percentages may be approved by the
Compensation Committee, are owned, directly or indirectly, by the Company.

ARTICLE 5
MISCELLANEOUS

Section 5.1  Administration.  This Award shall be administered by the
Compensation Committee or its delegate as provided in Section 2 of the Plan.

Section 5.2  No Guarantee of Employment or Service; Compensation.  Nothing in
this Agreement shall be construed as an employment, consulting or similar
contract for services between the Company or any Subsidiary and the
Employee.  Any benefit derived under this Agreement shall not be considered
compensation for purposes of calculating any severance, resignation, bonus,
pension, retirement or similar payments or benefits.

Section 5.3  The Company’s Rights.  The existence of the Award shall not affect
in any way the right or power of the Company or its shareholders to make or
authorize any or all adjustments, recapitalizations, reorganizations or other
changes in the Company’s capital structure or its business, or any merger or
consolidation of the Company, or any issue of bonds, debentures, preferred or
other securities with preference ahead of or convertible into, or otherwise
affecting the Shares or the rights thereof, or the dissolution or liquidation of
the Company, or any sale or transfer of all or any part of the Company’s assets
or business, or any other act or proceeding, whether of a similar character or
otherwise.

 
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Section 5.4  Employee.  Whenever the word “Employee” is used in any provision of
this Agreement, under circumstances where the provision should logically be
construed to apply to the estate, personal representative or beneficiary to whom
this Award may be transferred by will or by the laws of descent and
distribution, the word “Employee” shall be deemed to include such person.

Section 5.5  Nontransferability of Award.   This Award is not transferable by
the Employee otherwise than by will or the laws of descent and distribution.

Section 5.6  Entire Agreement; Modification.  This Agreement contains the entire
agreement between the parties with respect to the subject matter contained
herein, and may not be modified, except as provided in a written document signed
by each of the parties hereto.  Any oral or written agreements, representations,
warranties, written inducements, or other communications made prior to the
execution of this Agreement shall be void and ineffective for all purposes.

Section 5.7 Severability.  In the event that any term or provision of this
Agreement shall be finally determined to be superseded, invalid, illegal or
otherwise unenforceable pursuant to applicable law by a governmental authority
having jurisdiction and venue, that determination shall not impair or otherwise
affect the validity, legality or enforceability, to the maximum extent
permissible by law, (a) by or before that authority of the remaining terms and
provisions of this Agreement, which shall be enforced as if the unenforceable
term or provision were deleted, or (b) by or before any other authority of any
of the terms and provisions of this Agreement.

Section 5.8  Governing Law.  This Agreement shall be governed and construed in
accordance with the laws of the State of Indiana (regardless of the law that
might otherwise govern under applicable Indiana principles of conflict of laws).
 
 
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