Document:

Exhibit

This instrument and the rights and obligations evidenced hereby are subordinate in the manner and to the extent set forth in that certain Subordination Agreement (the “Subordination Agreement”) dated as of January 22, 2018, by and among TW Southcross Sidecar II LP, TW Southcross Sidecar II (N-QP) LP, EIG Energy Fund XV (Cayman), L.P., EIG Energy Fund XV-B, L.P., EIG Energy Fund XV-A, L.P., EIG Energy Fund XV, L.P., EIG Energy Fund XIV (Cayman), L.P., EIG Energy Fund XIV-B, L.P., EIG Energy Fund XIV-A, L.P., EIG Energy Fund XIV, L.P. (collectively, the “Initial Noteholders”), as Subordinated Lenders, and Wells Fargo Bank, N.A., as Senior Agent for the Senior Lenders to the Senior Debt (as defined in the Subordination Agreement) owed by Southcross Energy Partners, L.P. (“Borrower”), a Delaware limited partnership, as borrower, and those certain subsidiaries of Borrower from time to time party thereto; and each holder of this instrument, by its acceptance hereof, irrevocably agrees to be bound by the provisions of the Subordination Agreement.
SOUTHCROSS ENERGY PARTNERS, L.P.
SENIOR UNSECURED NOTE
[DATE]                                            Original Principal Amount:
          $[•]

Southcross Energy Partners, L.P., a Delaware limited partnership (the “Issuer”), and each of the other signatories hereto (each, an “Obligor” and, collectively with the Issuer, the “Company”), hereby jointly and severally promise to pay to [•] (together with any transferee permitted under the terms hereof, the “Holder”), in no event later than the Maturity Date, the principal amount of $[•] or such lesser principal amount then outstanding, together with interest thereon calculated in accordance with the provisions of this Senior Unsecured Note (as the same may be amended, modified, assigned or reissued to a different holder, this “Note”).
This Note and any other notes issued by the Company on the date hereof to the Holder or one of its Affiliates and having substantially similar terms are collectively referred to herein as the “Notes.”
Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Senior Loan Agreement.
1.Payment of Interest.  Interest shall accrue on a daily basis from the Issuance Date (as defined below) until this Note is repaid in full in cash at the rate (the “Interest Rate”) of 12.5% per annum, payable on the last Business Day of each March, June, September and December.  Interest on this Note shall be paid in kind (other than with respect to interest payable (x) on or after the Maturity Date (as defined below), (y) in connection with prepayment, or (z) upon acceleration of the Note, which shall be payable in cash) by adding such interest to the principal amount then outstanding under this Note on such interest payment date; provided that all interest in excess of the first $[•] of interest paid in kind on this Note shall be payable in cash on the applicable interest payment date.  Notwithstanding the foregoing, any obligation of any Obligor to make any cash payment hereunder shall be subject to the Subordination Agreement.

2.Payment of Principal and Interest. 

(a)Scheduled Payment.  The Company shall pay the outstanding principal amount of this Note on November 5, 2019 (the “Maturity Date”), together with all accrued and unpaid interest thereon and any other remaining obligations under this Note.

(b)Optional Prepayments.  Subject to Section 17 and the Subordination Agreement, the Company may, at any time and from time to time without premium or penalty, prepay all or any portion of the outstanding principal amount of, or interest on, this Note.  In connection with each prepayment of principal hereunder, the Company shall also pay all accrued and unpaid interest hereunder in cash.  Amounts prepaid or repaid under this Note may not be reborrowed.

(c)Application of Payments.  Payments under this Note shall be applied as follows: (i) first to any accrued and unpaid obligations under Section 15, (ii) second to any accrued but unpaid interest hereunder (including interest payable at the default rate pursuant to Section 4(b)(i)) until all such interest is paid, (iii) third to the payment of accrued interest that has been paid in-kind hereunder (including interest that was paid at the default rate pursuant to Section 4(b)(i)) until all such capitalized interest is paid, (iv) fourth to the repayment of the principal outstanding hereunder, and (v) fifth to the repayment of all other accrued and unpaid obligations outstanding hereunder. 

(d)Allocation of Payments. All payments of principal, interest and other obligations under the Senior Unsecured Notes by the Company shall be applied to all outstanding Senior Unsecured Notes ratably in accordance with the unpaid principal amount thereof.

3.    Covenants.  The Company agrees that, until each Senior Unsecured Note is paid in full:
            
(a)The Company shall not, whether directly or indirectly, take or permit, or fail to take or permit, any action which would constitute a Default (as defined in the Senior Loan Agreement) or Event of Default (as defined in the Senior Loan Agreement), in each case other than as a result of any failure to comply with Section 9.01 of the Senior Loan Agreement, regardless of whether (i) the Senior Lenders have entered into a forbearance with respect to any provision of the Senior Loan Agreement applicable to such action, (ii) the Senior Loan Agreement has been terminated, or (iii) any obligations remain outstanding under the Senior Loan Agreement. 

(b)The Company shall (i) treat the outstanding principal balance of the Note as indebtedness for borrowed money on its books and records and in all applicable regulatory filings and (ii) give appropriate notices of the Note and the related borrowing to the extent the Company is required to give notice of the incurrence of indebtedness pursuant to applicable law or its contractual obligations. 

(c)With respect to any Subsidiary of the Issuer that guarantees the obligations under the Senior Loan Agreement (a “Subsidiary Company”) that is or becomes party to any other Senior Unsecured Note, the Issuer shall promptly cause such Subsidiary to become party this Note as an “Obligor” and a “Company” hereunder and such Subsidiary shall jointly and severally agree to pay all obligations under this Note pursuant documentation reasonably acceptable to Holder. 

4.    Events of Default.

(a)Definition.  For purposes of this Note, an Event of Default shall be deemed to have occurred if: 

(i)The Company fails to pay when due and payable (whether at maturity, by acceleration or otherwise) (A) the full amount of interest then accrued on this Note that is required to be paid in cash, (B) the full amount of any principal payment on this Note, or (C) any other amount due and owing under this Note.

(ii)The Issuer, any Obligor, or any Subsidiary of the Issuer or any Obligor makes an assignment for the benefit of creditors or admits in writing its inability to pay its debts generally as they become due; or an order, judgment or decree is entered adjudicating the Issuer, any Obligor, or any Subsidiary of the Issuer or any Obligor bankrupt or insolvent; or any order for relief with respect to the Issuer, any Obligor, or any Subsidiary of the Issuer or any Obligor is entered under the Bankruptcy Code; or the Issuer, any Obligor, or any Subsidiary of the Issuer or any Obligor petitions or applies to any tribunal for the appointment of a custodian, trustee, receiver or liquidator of the Issuer, any Obligor, or any Subsidiary of the Issuer or any Obligor, or of any substantial part of the assets of the Issuer, any Obligor, or any Subsidiary of the Issuer or any Obligor, or commences any proceeding relating to the Issuer, any Obligor, or any Subsidiary of the Issuer or any Obligor under any bankruptcy reorganization, arrangement, insolvency, readjustment of debt, dissolution or liquidation law of any jurisdiction; or any such petition or application is filed, or any such proceeding is commenced, against the Issuer, any Obligor, or any Subsidiary of the Issuer or any Obligor and either (A) the Issuer, any Obligor, or any Subsidiary of the Issuer or any Obligor by any act indicates its approval thereof, consent thereto or acquiescence therein or (B) such petition, application or proceeding is not dismissed within 60 days. 

(iii)The obligations under the Senior Loan Agreement shall have become due and payable prior to their stated maturity at any time that a “default” (however defined) has occurred and is continuing thereunder and which “default” has not been waived or cured within the specified period(s) of time permitted thereunder.

(iv)A Change in Control (as defined in the Senior Loan Agreement) shall occur.

(v)The Company fails to comply with its obligations under Section 3 and such failure to comply shall continue unremedied (if such default is capable of remedy) for a period of 20 days after the earlier of (a) an officer of the Company becoming aware of such default and (ii) written notice thereof from the Holder (or any other holder of a Senior Unsecured Note) to the Company.

(b)    Consequences of Events of Default.

(i)If any Event of Default has occurred and is continuing, the Interest Rate on all obligations under this Note, including, for the avoidance of doubt, on overdue amounts owed pursuant to Section 15, shall automatically increase by an increment of two percentage points (2.00%) per annum to the extent permitted by law (and such default interest shall be payable in kind to the same extent that the initial Interest Rate is payable in kind).  Any increase of the Interest Rate resulting from the operation of this subparagraph shall terminate as of the close of business on the date on which no Events of Default exist (subject to subsequent increases pursuant to this subparagraph).

(ii)If an Event of Default of the type described in Section 4(a)(ii) has occurred, the aggregate principal amount of this Note (together with all accrued interest thereon and all other amounts due and payable with respect thereto) shall become immediately due and payable without any requirement of a notice, presentment or other action on the part of the Holder, and the Company shall immediately pay to the Holder all amounts due and payable with respect to this Note.

(iii)If an Event of Default other than of the type described in Section 4(a)(ii) has occurred, the aggregate principal amount of this Note (together with all accrued interest thereon and all other amounts due and payable with respect thereto) may, at the option of the Holder upon written notice to the Company, become immediately due and payable, and the Company shall immediately pay to the Holder all amounts due and payable with respect to this Note.

(iv)Notwithstanding the foregoing, the payment by any Obligor of amounts due pursuant to this Section 4 shall be subject to the prior payment in full of the Senior Debt, as set forth in the Subordination Agreement.

5.    Definitions. For purposes of this Note, the following capitalized terms have the following meaning:

“Affiliates” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.
“Bankruptcy Code” means Title 11, U.S. Code or any similar federal or state law for the relief of debtors.
“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a person, whether through the ownership of voting securities, by contract or otherwise, and the terms “Controlling” and “Controlled” shall have meanings correlative thereto.
“Controlled Investment Affiliate” means, as to any person, any other person (i) which directly or indirectly is in Control of, is Controlled by, or is under common Control with, such person and is organized by such person (or any person Controlling such person) primarily for making, or otherwise having as its primary activity holding or exercising control over, equity or debt investments in the Issuer or other portfolio companies or (ii) which is obligated pursuant to a commitment agreement to invest its capital as directed by such person.
“GAAP” means generally accepted accounting principles in effect from time to time in the United States applied on a consistent basis subject to the impact of “fresh start” accounting.
“Issuance Date” means January 22, 2018.
“Permitted Noteholders” means (a) EIG Management Company, LLC, a Delaware limited liability company, (b) Tailwater Capital LLC, a Texas limited liability company and (c) their respective Controlled Investment Affiliates.
“Person” or “person” means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust (including any beneficiary thereof), a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof. 
“Related Parties” with respect to any Person, means such Person's Affiliates and the directors, officers, employees, partners, agents, trustees, administrators, managers, advisors and representatives of it and its Affiliates.

“Senior Debt” means all Secured Obligations (as defined in the Senior Loan Agreement).
“Senior Loan Agreement” means certain Third Amended and Restated Revolving Credit Agreement, dated as of August 4, 2014, among the Issuer, as borrower, Wells Fargo Bank, N.A., as administrative agent, and the lenders party thereto, as amended prior to the Issuance Date.
“Senior Unsecured Notes” means, collectively, this Note and each other Senior Unsecured Note, dated as of the Issuance Date, issued by the Issuer to an Initial Noteholder, as the same may be amended, modified, assigned or reissued to a different holder. 
“Subsidiary” means, with respect to any person (the “parent”) at any date, any corporation, limited liability company, partnership, association or other business entity (a) of which securities or other ownership interests representing more than 50% of the ordinary voting power are, at the time any determination is being made, directly or indirectly, owned, Controlled or held by the parent, or (b) that is, at the time any determination is being made, otherwise Controlled by the parent; provided that (i) in determining the percentage of ownership interests of any person controlled by the parent, no ownership interest in the nature of a “qualifying share” of the parent shall be deemed to be outstanding and (ii) no joint venture shall be considered a Subsidiary for the purposes of this Note unless its financial results are required to be consolidated with the Issuer under GAAP and the Issuer shall have provided written notice to the Holder of its election to treat such joint venture as a Subsidiary under this Agreement.
“Subsidiary Company” has the meaning assigned thereto in Section 3(c) hereof.
6.    Amendment and Waiver.  The provisions of this Note may be amended and the Company may take any action herein prohibited, or omit to perform any act herein required to be performed by it, only upon the written consent of the Holder; provided that Section 17 of this Note shall not be amended without the written consent of the Administrative Agent (as defined in the Senior Loan Agreement).
 
7.    Cancellation.  After all principal, accrued interest and any other obligations at any time owed on this Note have been paid in full in cash, this Note shall be surrendered to the Company for cancellation and shall not be reissued. 

8.    Payments.  All payments in cash to be made to the Holder shall be made in the lawful money of the United States of America in immediately available funds.

9.    Place of Payment.  Payments of principal and interest shall be delivered to the Holder at such address as is specified by prior written notice by the Holder. 

10.    Governing Law.  All questions concerning the construction, validity and interpretation of this Note will be governed by and construed in accordance with the internal laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule.  Any litigation arising hereunder or related thereto shall be tried by the United States District Court for the Southern District of New York, provided that if such litigation shall not be permitted to be tried by such court then such litigation shall be held in the state courts of New York sitting in New York City.  The Company and the Holder, irrevocably consent to and confer personal jurisdiction on the United States District Court for the Southern District of New York, or, if (but only if) the litigation in question shall not be permitted to be tried by such court, on the state courts of New York sitting in New York City, and expressly waives any objection to the venue of such court, as the case may be.

11.    Waiver of Presentment, Demand and Dishonor.  The Company hereby waives presentment for payment, protest, demand, notice of protest, notice of nonpayment and diligence with respect to this Note, and waives and renounces all rights to the benefits of any statute of limitations or any moratorium, appraisement, exemption, or homestead now provided or that hereafter may be provided by any federal or applicable state statute, including but not limited to exemptions provided by or allowed under the Bankruptcy Code, both as to itself and as to all of its property, whether real or personal, against the enforcement and collection of the obligations evidenced by this Note and any and all extensions, renewals, and modifications hereof.

12.    Business Days.  If any cash payment is due, or any time period for giving notice or taking action expires, on a day which is a Saturday, Sunday or legal holiday in the State of New York, the payment shall be due and payable on, and the time period shall automatically be extended to, the next business day immediately following such Saturday, Sunday or legal holiday, and interest shall continue to accrue at the required rate hereunder until any such payment is made.

13.    Usury Laws.  It is the intention of the Company and the Holder to conform strictly to all applicable usury laws now or hereafter in force, and any interest payable under this Note shall be subject to reduction to the amount not in excess of the maximum legal amount allowed under the applicable usury laws as now or hereafter construed by the courts having jurisdiction over such matters.  If the maturity of this Note is accelerated by reason of an election by the Holder resulting from an Event of 

Default, optional prepayment by the Company or otherwise, then earned interest may never include more than the maximum amount permitted by law, computed from the date hereof until payment, and any interest in excess of the maximum amount permitted by law shall be canceled automatically and, if theretofore paid, shall at the option of the Holder either be rebated to the Company or credited on the principal amount of this Note, or if this Note has been paid, then the excess shall be rebated to the Company.  The aggregate of all interest (whether designated as interest, service charges, points or otherwise) contracted for, chargeable, or receivable under this Note shall under no circumstances exceed the maximum legal rate upon the unpaid principal balance of this Note remaining unpaid from time to time.  If such interest does exceed the maximum legal rate, it shall be deemed a mistake and such excess shall be canceled automatically and, if theretofore paid, rebated to the Company or credited on the principal amount of this Note, or if this Note has been repaid, then such excess shall be rebated to the Company.

14.    Taxes.  The Company shall make all payments, whether on account of principal, interest, fees or otherwise, free of and without deduction or withholding for any present or future taxes, duties or other charges (“Taxes”), except as required by law. If the Company is compelled by law to deduct or withhold any Taxes, it shall (i) be entitled to make such deduction or withholding and (ii) shall promptly pay to the Holder such additional amount as is necessary to ensure that the net amount received by the Holder is equal to the amount payable by the Company had there been no deduction or withholding, unless such Tax is (A) a Tax imposed on or measured by net income (however denominated),  a franchise Tax, or a branch profits Tax, in each case, imposed as a result of the Holder having a present or former connection with the jurisdiction imposing such Tax (other than a connection directly relating to this Note), including by way of being organized under the laws of, or having its principal office or lending office located in, such jurisdiction (or any political subdivision thereof) or (B) a U.S. federal withholding tax, including such a Tax imposed by reason of Sections 1471 through 1474 of the Internal Revenue Code of 1986, as amended (the “Code”), any regulations or official interpretations thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Code, and any intergovernmental agreement with respect thereto and applicable official implementing guidance thereunder.

15.    Expenses and Indemnity.

(a)    Costs and Expenses.  The Company shall pay (i) all reasonable out-of-pocket expenses incurred by the Holder and its Affiliates (including the reasonable fees, charges and disbursements of counsel) in connection with the preparation, negotiation, execution, delivery and administration (both before and after the execution hereof) of this Note and any amendments, modifications or waivers of or consents related to the provisions hereof and (ii) all out-of-pocket expenses incurred by the Holder (including the fees, charges and disbursements of any counsel for the Holder) in connection with the enforcement or protection of its rights in connection with this Note, including all such out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of the obligations under this Note.  Without limiting the foregoing, on the Issuance Date, the Company shall pay, in immediately available funds, the reasonable fees, charges and disbursements of Debevoise & Plimpton LLP, incurred in connection with the preparation of this Note.

(b)    Indemnity.  The Company agrees to indemnify and hold harmless the Holder and the Holder’s Related Parties (each, an “Indemnified Party”) from and against, any and all claims, damages, losses, liabilities and related expenses (including the reasonable fees, charges and disbursements of any counsel for any Indemnified Party), incurred by any Indemnified Party or asserted against any Indemnified Party by any Person (including any Obligor) other than such Indemnified Party and its Related Parties arising out of, in connection with, or by reason of (i) the execution or delivery of this Note or the performance by the parties hereto of their respective obligations hereunder, (ii) the actual or proposed use of the proceeds of this Note, or (iii) any actual or prospective claim, investigation, litigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by an Obligor, and regardless of whether any Indemnified Party is a party thereto; provided that such indemnity shall not be available to any Indemnified Party to the extent that such claims, damages, losses, liabilities or related expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnified Party. 

(c)    Waiver of Consequential Damages, Etc.  To the extent permitted by applicable law, each party hereto hereby waives for itself (and, in the case of an Obligor, for each other Obligor and its Subsidiaries) any claim against any Company or any Holder and their respective affiliates, directors, employees, attorneys, agents or sub-agents, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) (whether or not the claim therefor is based on contract, tort or duty imposed by any applicable legal requirement) arising out of, in connection with, as a result of, or in any way related to, this Note or any other Senior Unsecured Note or any agreement or instrument contemplated hereby or thereby or referred to herein or therein, the transactions contemplated hereby or thereby, or any act or omission or event occurring in connection therewith, and each party hereto (and, in the case of an Obligor, on behalf of each other Obligor and its Subsidiaries) hereby waives, releases and agrees not to sue upon any such claim or any such damages, whether or not accrued and whether or not known or suspected to exist in its 

favor; provided that nothing contained in this sentence shall limit any Obligor’s indemnity obligations to the extent such special, indirect, consequential or punitive damages are included in any third party claim in connection with which such Indemnitee is entitled to indemnification hereunder.

16.    Assignments of this Note.

(a)    The provisions of this Note shall be binding on any successors and assigns or other transferees of this Note; provided, however, that the Company may not assign this Note or any rights or duties hereunder without the Holder’s prior written consent and any prohibited assignment shall be absolutely void ab initio. 

(b)    This Note may be sold, transferred, assigned or otherwise disposed of by the Holder; provided, that (i) such sale, transfer, assignment or other disposal complies with all applicable federal and state securities laws, (ii) such sale, transfer, assignment or other disposal is made to (A) a Permitted Noteholder or (B) subject to Section 16(c), any other Person approved in writing by the Company (such approval not to be unreasonably withheld or delayed) and (iii) any such transferee acknowledges and agrees in writing to the provisions of this Section 16.

(c)    Prior to any sale, transfer, assignment or other disposal of any portion of this Note to any Person other than a Permitted Noteholder, the transferring holder shall first give written notice (the “Offer Notice”) to each Permitted Noteholder of the proposed transfer (the “Offered Interests”), including the principal amount of the Note proposed to be transferred, and offering such Permitted Noteholders the right to purchase all (but not less than all) of such Offered Interests at par.  If any Permitted Noteholder desires to purchase such Offered Interests, it shall have ten (10) days following receipt of the Offer Notice to notify the then current Holder in writing of its election to purchase such Offered Interests.  Any such election shall be irrevocable, and such electing Permitted Noteholder shall be bound and obligated to purchase such Offered Interests in accordance with such election.  If more than one Permitted Noteholder timely delivers such election, the Offered Interests shall be allocated between such electing Permitted Noteholders based on the relative pro rata portions of all Senior Unsecured Notes held by such Permitted Notheholders.  If any Permitted Noteholder fails to timely notify the transferring holder of its election or elects not to acquire such Offered Interests, it shall be deemed to have elected not to acquire all or any portion of the Offered Interests pursuant to this Section 16(c).  Upon receiving any applicable elections as provided in this Section 16(c), the transferring holder shall set the time and place for closing of the Offered Interests by notifying the Permitted Notheholder(s) that elected to purchase the Offered Interests and the Issuer of the same (which closing shall occur no earlier than fifteen (15) days after the date such notice is delivered to such electing Permitted Noteholders).  

(d)    The Company acknowledges and agrees that the Permitted Noteholders are express third party beneficiaries of this Section 16. 

(e)    Without limiting the foregoing, any sale, transfer, assignment or other disposal of any portion of this Note shall be subject to the limitations set forth in Section 1.3 of the Subordination Agreement.

17.    Subordination.  The Company agrees, and the Holder by his acceptance of this Note, also agrees, that the repayment of any obligations under this Note is subordinate, to the extent and in the manner set forth in the Subordination Agreement, to the prior payment in full of all Senior Debt and that the subordination is for the benefit of and enforceable by the holders of such Senior Debt.

18.    Severability. In the event that any provision of this Note is deemed to be invalid, illegal or unenforceable by reason of the operation of any law or by reason of the interpretation placed thereon by any court or governmental authority, the validity, legality and enforceability of the remaining provisions of this Note shall not in any way be affected or impaired thereby, and the affected provision shall be modified to the minimum extent permitted by law so as most fully to achieve the intention of this Note.

19.    Notices.  Unless otherwise specifically provided herein, any notice or other communication herein required or permitted to be given shall be in writing and may be personally served, or sent by facsimile or United States of America mail or courier service and shall be deemed to have been given when delivered in person or by courier service, upon receipt of facsimile in complete and legible form, or three business days after depositing it in the United States of America mail with postage prepaid and properly addressed; provided that notices to the Holder shall not be effective until received. For the purposes hereof, the address of the Company and the Holder shall be (a) as set forth below or (b) such other address as shall be designated by such Person in a written notice delivered to the other parties hereto.

COMPANY
Southcross Energy Partners, L.P.
1717 Main Street, Suite 5200
Dallas, Texas 75201
Attention: General Counsel
Email:  Kelly.Jameson@southcrossenergy.com

with a copy (which shall not constitute notice) to:

Locke Lord LLP
600 Congress Avenue, Suite 2200
Austin, Texas 78701
Attention :  Michelle Earley

Email :  mearley@lockelord.com

HOLDER
__________________________
__________________________
__________________________
Attention: _________________
Fax: ______________________
Email: ____________________

with a copy (which shall not constitute notice) to:

___________________________
___________________________
___________________________
Attention: __________________
Fax: _______________________
Email: ______________________ 

[remainder of page intentionally left blank]
*          *          *          *          *

IN WITNESS WHEREOF, the Company has executed and delivered this Note on the date of the first written above.
	
					
	 
	 
	SOUTHCROSS ENERGY PARTNERS, L.P.

	 
	 
	 
	 
	 

	 
	 
	By:
	Southcross Energy Partners GP, LLC,

	 
	 
	 
	its general partner
	 

	 
	 
	 
	 
	 

	 
	 
	By:
	 

	 
	 
	Name:
	 

	 
	 
	Title:
	 

	 
	 
	 
	 

	 
	 
	SOUTHCROSS ENERGY OPERATING, LLC

	 
	 
	SOUTHCROSS ENERGY LP LLC

	 
	 
	SOUTHCROSS ENERGY GP LLC

	 
	 
	SOUTHCROSS DELTA PIPELINE LLC

	 
	 
	SOUTHCROSS PROCESSING LLC

	 
	 
	SOUTHCROSS ALABAMA PIPELINE LLC

	 
	 
	SOUTHCROSS NUECES PIPELINES LLC

	 
	 
	SOUTHCROSS ENERGY FINANCE CORP.

	 
	 
	FL RICH GAS SERVICES GP, LLC

	 
	 
	 
	 
	 

	 
	 
	By:
	 

	 
	 
	Name:
	 

	 
	 
	Title:
	 

	 
	 
	 
	 
	 

	 
	 
	SOUTHCROSS CCNG GATHERING LTD.

	 
	 
	SOUTHCROSS CCNG TRANSMISSION LTD.

	 
	 
	SOUTHCROSS GULF COAST

	 
	 
	TRANSMISSION LTD.

	 
	 
	SOUTHCROSS MISSISSIPPI PIPELINE, L.P.

	 
	 
	SOUTHCROSS MISSISSIPPI GATHERING,

	 
	 
	L.P.

	 
	 
	SOUTHCROSS MIDSTREAM SERVICES, L.P.

	 
	 
	SOUTHCROSS MARKETING COMPANY LTD.

	 
	 
	SOUTHCROSS NGL PIPELINE LTD.

	 
	 
	SOUTHCROSS GATHERING LTD.

	 
	 
	SOUTHCROSS MISSISSIPPI INDUSTRIAL

	 
	 
	GAS SALES, L.P.
	 

	 
	 
	 
	 
	 

	 
	 
	By:
	Southcross Energy Partners GP, LLC,

	 
	 
	 
	as general partner
	 

	 
	 
	 
	 
	 

	 
	 
	By:
	 

	 
	 
	Name:
	 
	 

	 
	 
	Title:
	 
	 

Signature Page to Senior Unsecured Note

	
					
	 
	 
	FL RICH GAS SERVICES, LP

	 
	 
	 
	 
	 

	 
	 
	By:
	FL Rich Gas Services GP, LLC

	 
	 
	 
	its general partner
	 

	 
	 
	 
	 
	 

	 
	 
	By:
	 

	 
	 
	Name:
	 
	 

	 
	 
	Title:
	 
	 

	 
	 
	 
	 
	 

	 
	 
	FL RICH GAS UTILITY GP, LLC

	 
	 
	 
	 
	 

	 
	 
	By:
	 

	 
	 
	Name:
	 
	 

	 
	 
	Title:
	 
	 

	 
	 
	 
	 
	 

	 
	 
	FL RICH GAS UTILITY, LP

	 
	 
	SOUTHCROSS TRANSMISSION, LP

	 
	 
	 
	 
	 

	 
	 
	By:
	FL Rich Gas Utility GP, LLC, its general

	 
	 
	 
	partner
	 

	 
	 
	 
	 
	 

	 
	 
	By:
	 

	 
	 
	Name:
	 
	 

	 
	 
	Title:
	 
	 

Signature Page to Senior Unsecured Note

As to sections 16 and 17, acknowledged and agreed by: 
	
					
	[HOLDER]
	 
	 
	 

	 
	 
	 
	 
	 

	By:
	 
	 
	 
	 

	Name:
	 
	 
	 
	 

	Title:
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

Signature Page to Senior Unsecured NoteExhibit 10.1

 

EXECUTED

 

 

 

 

 

 

 

PATRICK
INDUSTRIES, INC.

 

(an
Indiana corporation)

 

$150,000,000

 

1.00%
Convertible Senior Notes due 2023

 

PURCHASE
AGREEMENT

 

 

 

 

 

 

 

 

 

 

Dated:
January 17, 2018

 

 

 

     

    

    

 

PATRICK
INDUSTRIES, INC.

 

(an
Indiana corporation)

 

$150,000,000

 

1.00%
Convertible Senior Notes due 2023

 

PURCHASE
AGREEMENT

 

January
17, 2018

 

Merrill
Lynch, Pierce, Fenner & Smith

Incorporated

Wells
Fargo Securities, LLC

 

as
Representatives of the several Initial Purchasers

 

c/o
Merrill Lynch, Pierce, Fenner & Smith

Incorporated

One
Bryant Park

New
York, New York 10036

 

c/o
Wells Fargo Securities, LLC

375
Park Avenue, 3rd Floor

New
York, New York 10152

 

Ladies
and Gentlemen:

 

Patrick
Industries, Inc., an Indiana corporation (the “Company”), confirms its agreement with Merrill Lynch, Pierce, Fenner &
Smith Incorporated (“Merrill Lynch”), Wells Fargo Securities, LLC (“Wells Fargo”), and each of the other
Initial Purchasers named in Schedule A hereto (collectively, the “Initial Purchasers,” which term shall also include
any initial purchaser substituted as hereinafter provided in Section 11 hereof), for whom Merrill Lynch and Wells Fargo are
acting as representatives (in such capacity, the “Representatives”), with respect to (i) the sale by the Company and
the purchase by the Initial Purchasers, acting severally and not jointly, of the respective principal amounts set forth in Schedule
A hereto of $150,000,000 aggregate principal amount of the Company’s 1.00% Convertible Senior Notes due 2023 (the “Initial
Securities”) and (ii) the grant by the Company to the Initial Purchasers, acting severally and not jointly, of the option
described in Section 2(b) hereof to purchase all or any part of an additional $22,500,000 aggregate principal amount of the Company’s
1.00% Convertible Senior Notes due 2023 (the “Option Securities” and, together with the Initial Securities, the “Securities”).
The Securities are to be issued pursuant to an indenture dated as of January 22, 2018 (the “Indenture”) between the
Company and U.S. Bank National Association, as trustee (the “Trustee”). The Securities will be convertible into cash,
shares of common stock, no par value per share, of the Company (“Common Stock”) or a combination of cash and shares
of Common Stock, at the option of the Company, on the terms, and subject to the conditions, set forth in the Indenture.

 

     

    

    

 

In
connection with the offering of the Initial Securities, the Company is separately entering into a convertible note hedge transaction
and a warrant transaction with each of Bank of America, N.A. and Wells Fargo Bank, National Association (the “Call Spread
Counterparties”), in each case pursuant to a convertible note hedge confirmation (each, a “Base Bond Hedge Confirmation”)
and a warrant confirmation (each, a “Base Warrant Confirmation” and, the Base Warrant Confirmations together with
the Base Bond Hedge Confirmations, the “Base Call Spread Confirmations”), respectively, each to be dated the date
hereof, and in connection with any exercise by the Initial Purchasers of their option to purchase any Option Securities, the Company
and each of the Call Spread Counterparties may enter into an additional convertible note hedge transaction and an additional warrant
transaction pursuant to an additional convertible note hedge confirmation (each, an “Additional Bond Hedge Confirmation”)
and an additional warrant confirmation (each, an “Additional Warrant Confirmation” and, the Additional Warrant Confirmations
together with the Additional Bond Hedge Confirmations, the “Additional Call Spread Confirmations”), respectively,
each to be dated the date on which the Initial Purchasers exercise their option to purchase such Option Securities. We refer to
the Base Call Spread Confirmations and the Additional Call Spread Confirmations collectively herein as the “Call Spread
Confirmations.”

 

The
Company understands that the Initial Purchasers propose to make an offering of the Securities on the terms and in the manner set
forth herein and agrees that the Initial Purchasers may resell, subject to the conditions set forth herein, all or a portion of
the Securities to purchasers (“Subsequent Purchasers”) at any time after this Agreement has been executed and delivered.
The Securities are to be offered and sold through the Initial Purchasers without being registered under the Securities Act of
1933, as amended (the “1933 Act”), in reliance upon exemptions therefrom. Pursuant to the terms of the Securities
and the Indenture, investors that acquire Securities may only resell or otherwise transfer such Securities if such Securities
are hereafter registered under the 1933 Act or if an exemption from the registration requirements of the 1933 Act is
available (including the exemption afforded by Rule 144A (“Rule 144A”) of the rules and regulations promulgated
under the 1933 Act (the “1933 Act Regulations”) by the Securities and Exchange Commission (the “Commission”)).

 

The
Company has prepared and delivered to each Initial Purchaser copies of a preliminary offering memorandum dated January 16, 2018
prior to the Applicable Time (as defined below) (the “Preliminary Offering Memorandum”) and has prepared and will
deliver to each Initial Purchaser, on the date hereof or the next succeeding day, copies of a final offering memorandum dated
January 17, 2018 (the “Final Offering Memorandum”), each for use by such Initial Purchaser in connection with its
solicitation of purchases of, or offering of, the Securities. “Offering Memorandum” means, with respect to any date
or time referred to in this Agreement, the most recent offering memorandum (whether the Preliminary Offering Memorandum or the
Final Offering Memorandum, or any amendment or supplement to either such document), including exhibits thereto and any documents
incorporated therein by reference, which has been prepared and delivered by the Company to the Initial Purchasers, in the case
of the Preliminary Offering Memorandum prior to the Applicable Time, in connection with their solicitation of purchases of, or
offering of, the Securities. The Company will prepare a final term sheet reflecting the final terms of the Securities, in the
form set forth in Schedule B hereto (the “Final Term Sheet”), and will deliver such Final Term Sheet to the Initial
Purchasers prior to the Applicable Time in connection with their solicitation of purchases of, or offering of, the Securities.
The Company agrees that, unless it obtains the prior written consent of the Representatives, it will not make any offer relating
to the Securities by any written materials other than the Offering Memorandum and the Issuer Written Information. “Issuer
Written Information” means (i) any writing intended for general distribution to investors as evidenced by its being specified
in Schedule C hereto, including the Final Term Sheet, and (ii) any “road show” that is a “written communication”
within the meaning of the 1933 Act. “General Disclosure Package” means the Preliminary Offering Memorandum and any
Issuer Written Information specified on Schedule C hereto and issued at or prior to 11:45 P.M., New York City time, on January
17, 2018 or such other time as agreed by the Company and the Representatives (such date and time, the “Applicable Time”).

 

All
references in this Agreement to financial statements and schedules and other information which is “contained,” “included”
or “stated” in the Offering Memorandum (or other references of like import) shall be deemed to mean and include all
such financial statements and schedules and other information which are incorporated by reference in the Offering Memorandum;
and all references in this Agreement to amendments or supplements to the Offering Memorandum shall be deemed to mean and include
the filing of any document under the Securities Exchange Act of 1934, as amended (the “1934 Act”), which is incorporated
by reference in the Offering Memorandum.

 

    	 	2	 

    

    

 

SECTION
1.  Representations and Warranties.

 

(a) 
Representations and Warranties by the Company. The Company represents and warrants to each Initial Purchaser as of the
date hereof, the Applicable Time, the Closing Time (as defined below) and any Date of Delivery (as defined below), except for
any representations and warranties that speak as of a specific date, in which case only as of such date, and agrees with each
Initial Purchaser, as follows:

 

(i) 
General Disclosure Package; Rule 144A Eligibility. The Company hereby confirms that it has authorized the use of the
General Disclosure Package, including the Preliminary Offering Memorandum and the Final Term Sheet, and the Final Offering Memorandum
in connection with the offer and sale of the Securities by the Initial Purchasers. The Securities are eligible for resale pursuant
to Rule 144A and will not be, at the Closing Time, of the same class as securities listed on a national securities exchange
registered under Section 6 of the 1934 Act, or quoted in a U.S. automated interdealer quotation system.

 

(ii) 
No Registration Required; No General Solicitation. Subject to the accuracy of the representations and warranties of the
Initial Purchasers set forth in Section 6 hereof and the compliance by the Initial Purchasers with procedures set forth in
Section 6 hereof, it is not necessary in connection with the offer, sale and delivery of the offered Securities to the Initial
Purchasers and to each Subsequent Purchaser in the manner contemplated by this Agreement, the General Disclosure Package and the
Final Offering Memorandum to register the Securities under the 1933 Act or to qualify the Indenture under the Trust Indenture
Act of 1939, as amended (the “1939 Act”). None of the Company, its Affiliates or any person acting on its or any of
their behalf (other than the Initial Purchasers and their respective Affiliates (as herein defined) and representatives, as to
whom the Company makes no representation) has engaged, in connection with the offering of the offered Securities, in any form
of general solicitation or general advertising within the meaning of Rule 502(c) under the 1933 Act Regulations.

 

(iii) 
Accurate Disclosure. As of the Applicable Time, neither (A) the General Disclosure Package nor (B) any Issuer Written Information,
when considered together with the General Disclosure Package, included, includes or will include an untrue statement of a material
fact or omitted, omits or will omit to state a material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading. The Final Offering Memorandum, at the Closing Time or at any Date
of Delivery did not, does not and will not contain an untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The documents
incorporated or deemed to be incorporated by reference in the General Disclosure Package and the Final Offering Memorandum, when
such documents incorporated by reference were filed with the Commission, when read together with the other information in the
General Disclosure Package or the Final Offering Memorandum, as the case may be, did not and will not include an untrue statement
of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading.

 

    	 	3	 

    

    

 

The
representations and warranties in this subsection shall not apply to statements in or omissions from the General Disclosure Package
or the Final Offering Memorandum (or any amendment or supplement thereto) made in reliance upon and in conformity with written
information furnished to the Company by any Initial Purchaser through the Representatives expressly for use therein. For purposes
of this Agreement, the only information so furnished shall be the information in the first paragraph under the heading “Plan
of Distribution—Commissions and Discounts,” the information in the first, second and third paragraphs under the heading
“Plan of Distribution—Price Stabilization, Short Positions,” and the information in the third and fourth paragraphs
under the heading “Plan of Distribution—Convertible Note Hedge and Warrant Transactions,” in each case contained
in the Offering Memorandum (collectively, the “Initial Purchaser Information”).

 

(iv) 
Incorporation of Documents by Reference. The documents incorporated or deemed to be incorporated by reference in the Offering
Memorandum, at the time they were or hereafter are filed with the Commission, complied and will comply in all material respects
with the requirements of the 1934 Act and the rules and regulations of the Commission under the 1934 Act (the “1934 Act
Regulations”).

 

(v) 
Independent Accountants. The accountants who certified the financial statements and supporting schedules included or incorporated
by reference in the General Disclosure Package and the Offering Memorandum are independent public accountants of the Company as
required by the 1933 Act, the 1933 Act Regulations, the 1934 Act, the 1934 Act Regulations and the Public Company Accounting Oversight
Board.

 

(vi) 
Financial Statements; Non-GAAP Financial Measures. The financial statements included or incorporated by reference in the
General Disclosure Package and the Final Offering Memorandum, together with the related schedules and notes, present fairly, in
all material respects, the financial position of the Company and its consolidated subsidiaries at the dates indicated and the
statement of operations, stockholders’ equity and cash flows of the Company and its consolidated subsidiaries for the periods
specified; and except as stated in the notes thereto, said financial statements have been prepared in conformity with U.S. generally
accepted accounting principles (“GAAP”) applied on a consistent basis throughout the periods involved, provided, however,
that those financial statements of the Company included or incorporated by reference in the General Disclosure Package and the
Final Offering Memorandum that are unaudited are subject to year-end adjustments and do not contain all footnotes that may be
required under GAAP for annual financial statements. The supporting schedules, if any, when reviewed with the financial statements
of the Company present fairly, in all material respects, in accordance with GAAP the information required to be stated therein.
The selected financial data and the summary financial information included in the General Disclosure Package and the Offering
Memorandum present fairly, in all material respects, the information shown therein and have been compiled on a basis consistent
with that of the audited financial statements included therein. Except as included therein, no historical or pro forma financial
statements or supporting schedules are required to be included or incorporated by reference in the General Disclosure Package
or the Offering Memorandum under the 1933 Act or the 1933 Act Regulations. All disclosures contained in the General Disclosure
Package or the Final Offering Memorandum, or incorporated by reference therein, regarding “non-GAAP financial measures”
(as such term is defined by the rules and regulations of the Commission) comply in all material respects with Regulation G of
the 1934 Act and Item 10 of Regulation S-K of the 1933 Act, to the extent applicable. The interactive data in eXtensible Business
Reporting Language incorporated by reference in the General Disclosure Package and the Final Offering Memorandum fairly presents
the information called for in all material respects and has been prepared in accordance with the Commission's rules and guidelines
applicable thereto.

 

    	 	4	 

    

    

 

(vii) 
No Material Adverse Change in Business. Except as otherwise stated therein, since the respective dates as of which information
is given in the General Disclosure Package or the Final Offering Memorandum, (A) there has been no material adverse change
in the condition, financial or otherwise, or in the financial condition, business affairs or business prospects of the Company
and its subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business (a “Material
Adverse Effect”), (B) there have been no transactions entered into by the Company or any of its subsidiaries, other
than those in the ordinary course of business, which are material with respect to the Company and its subsidiaries considered
as one enterprise, and (C)  there has been no dividend or distribution of any kind declared, paid or made by the Company
on any class of its capital stock.

 

(viii) 
Good Standing of the Company. The Company has been duly organized and is validly existing as a corporation in good standing
under the laws of the State of Indiana and has corporate power and authority to own, lease and operate its properties and to conduct
its business as described in the General Disclosure Package and the Final Offering Memorandum and to enter into and perform its
obligations under this Agreement; and the Company is duly qualified as a foreign corporation to transact business and is in good
standing (or has equivalent status) in each other jurisdiction in which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except where the failure so to qualify or to be in good standing
would not reasonably be expected to result in a Material Adverse Effect.

 

(ix) 
Good Standing of Subsidiaries. Each “significant subsidiary” of the Company (as such term is defined in Rule
1-02 of Regulation S-X) (each, a “Subsidiary” and, collectively, the “Subsidiaries”) has been duly organized
and is validly existing in good standing under the laws of the jurisdiction of its incorporation or organization, as applicable,
has corporate or similar power and authority to own, lease and operate its properties and to conduct its business as described
in the General Disclosure Package and the Final Offering Memorandum and is duly qualified to transact business and is in good
standing (or has equivalent status) in each jurisdiction in which such qualification is required, whether by reason of the ownership
or leasing of property or the conduct of business, except where the failure to so qualify or to be in good standing would not
reasonably be expected to result in a Material Adverse Effect. Except as otherwise disclosed in the General Disclosure Package
and the Final Offering Memorandum, all of the issued and outstanding capital stock of each Subsidiary has been duly authorized
and validly issued, is fully paid and non-assessable and is owned by the Company, directly or through subsidiaries, free and clear
of any security interest, mortgage, pledge, lien, encumbrance, claim or equity. None of the outstanding shares of capital stock
of any Subsidiary were issued in violation of the preemptive or similar rights of any securityholder of such Subsidiary. The only
subsidiaries of the Company are the subsidiaries listed on Schedule E hereto.

 

(x) 
Capitalization. The authorized, issued and outstanding shares of capital stock of the Company are as set forth in the General
Disclosure Package and the Final Offering Memorandum in the column entitled “Actual” under the caption “Capitalization”
(except for subsequent issuances, if any, pursuant to this Agreement, pursuant to reservations, agreements or employee benefit
plans referred to in the General Disclosure Package and the Final Offering Memorandum or pursuant to the exercise of convertible
securities or options referred to in the General Disclosure Package and the Final Offering Memorandum). The outstanding shares
of capital stock of the Company have been duly authorized and validly issued and are fully paid and non-assessable. None of the
outstanding shares of capital stock of the Company were issued in violation of the preemptive or other similar rights of any securityholder
of the Company.

 

    	 	5	 

    

    

 

(xi) 
Authorization of Agreement. This Agreement has been duly authorized, executed and delivered by the Company.

 

(xii) 
Authorization of the Indenture. The Indenture has been duly authorized by the Company and, when duly executed and delivered
by the Company and the Trustee, will constitute a valid and binding agreement of the Company, enforceable against the Company
in accordance with its terms, except as the enforcement thereof may be limited by bankruptcy, insolvency (including, without limitation,
all laws relating to fraudulent transfers), reorganization, moratorium or similar laws affecting enforcement of creditors’
rights generally and except as enforcement thereof is subject to general principles of equity (regardless of whether enforcement
is considered in a proceeding in equity or at law).

 

(xiii) 
Authorization of the Securities and the Common Stock. The Securities have been duly authorized and, at the Closing Time
or the relevant Date of Delivery, as the case may be, will have been duly executed by the Company and, when authenticated, issued
and delivered in the manner provided for in the Indenture and delivered against payment of the purchase price therefor as provided
in this Agreement, will constitute valid and binding obligations of the Company, enforceable against the Company in accordance
with their terms, except as the enforcement thereof may be limited by bankruptcy, insolvency (including, without limitation, all
laws relating to fraudulent transfers), reorganization, moratorium or similar laws affecting enforcement of creditors’ rights
generally and except as enforcement thereof is subject to general principles of equity (regardless of whether enforcement is considered
in a proceeding in equity or at law), and will be in the form contemplated by, and entitled to the benefits of, the Indenture.
The maximum number of shares of Common Stock issuable upon conversion of the Securities (including the maximum number of additional
shares of Common Stock by which the Conversion Rate (as such term is defined in the Indenture) may be increased upon conversion
in connection with a Make-Whole Fundamental Change (as such term is defined in the Indenture) and assuming (x) the Company elects,
upon each conversion of the Securities, to deliver solely shares of Common Stock, other than cash in lieu of any fractional shares,
in settlement of each such conversion and (y) the Initial Purchasers exercise their option to purchase the Option Securities in
full) (the “Maximum Number of Underlying Securities”) have been duly authorized and reserved for issuance by
all necessary corporate action and such Maximum Number of Underlying Securities, when issued upon such conversion, will be validly
issued and will be fully paid and non-assessable; and the issuance of such Maximum Number of Underlying Securities upon such conversion
will not be subject to the preemptive or other similar rights of any securityholder of the Company. The maximum number of shares
of Common Stock issuable upon exercise and settlement or termination of the warrants issued pursuant to the Base Warrant Confirmations
and any Additional Warrant Confirmations (the “Warrant Securities”) have been duly authorized and reserved
for issuance by all necessary corporate action and such Warrant Securities, when issued upon exercise and settlement or termination
of such warrants in accordance with the terms of such warrants, will be validly issued and will be fully paid and non-assessable;
and the issuance of such Warrant Securities upon such conversion will not be subject to the preemptive or other similar rights
of any securityholder of the Company.

 

(xiv) 
Description of the Securities, the Common Stock and the Indenture. The Securities and the Indenture will conform in all
material respects to the respective statements relating thereto contained in the General Disclosure Package and the Final Offering
Memorandum. The Common Stock conforms in all material respects to all statements relating thereto contained or incorporated by
reference in the General Disclosure Package and the Final Offering Memorandum and such description conforms in all material respects
to the rights set forth in the instruments defining the same.

 

    	 	6	 

    

    

 

(xv) 
Registration Rights. There are no persons with registration rights to have any securities registered for sale or sold by
the Company under the 1933 Act, other than those rights that have been disclosed in the General Disclosure Package and the Final
Offering Memorandum or have been waived.

 

(xvi) 
Absence of Violations, Defaults and Conflicts. Neither the Company nor any of its subsidiaries is (A) in violation of its
charter, by-laws or similar organizational document, (B) in default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease or
other agreement or instrument to which the Company or any of its subsidiaries is a party or by which it or any of them may be
bound or to which any of the properties or assets of the Company or any subsidiary is subject (collectively, “Agreements
and Instruments”), except for such defaults that would not, singly or in the aggregate, result in a Material Adverse Effect,
or (C) in violation of any law, statute, rule, regulation, judgment, order, writ or decree of any arbitrator, court, governmental
body, regulatory body, administrative agency or other authority, body or agency having jurisdiction over the Company or any of
its subsidiaries or any of their respective properties, assets or operations (each, a “Governmental Entity”), except
for such violations that would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect.
The execution, delivery and performance of this Agreement, the Indenture and the Securities and the consummation of the transactions
contemplated herein and in the General Disclosure Package and the Final Offering Memorandum (including the issuance and sale of
the Securities (including the issuance of any Common Stock upon conversion thereof) and the use of the proceeds from the sale
of the Securities as described therein under the caption “Use of Proceeds”), the issuance of any Warrant Securities
and compliance by the Company with its obligations hereunder have been duly authorized by all necessary corporate action and do
not and will not, whether with or without the giving of notice or passage of time or both, conflict with or constitute a breach
of, or default or Repayment Event (as defined below) under, or result in the creation or imposition of any lien, charge or encumbrance
upon any properties or assets of the Company or any subsidiary pursuant to, the Agreements and Instruments (except for such conflicts,
breaches, defaults or Repayment Events or liens, charges or encumbrances that would not, singly or in the aggregate, reasonably
be expected to result, in a Material Adverse Effect), nor will such action result in any violation of the provisions of (i) the
charter, by-laws or similar organizational document of the Company or any of its subsidiaries or (ii) any law, statute, rule,
regulation, judgment, order, writ or decree of any Governmental Entity (except, in the case of clause (ii) above, for any such
violation that would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect). As used
herein, a “Repayment Event” means any event or condition which gives the holder of any note, debenture or other evidence
of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment
of all or a portion of such indebtedness by the Company or any of its subsidiaries.

 

(xvii) 
Absence of Labor Dispute. No labor dispute with the employees of the Company or any of its subsidiaries exists or, to the
knowledge of the Company, is imminent, and the Company is not aware of any existing or imminent labor disturbance by the employees
of any of its or any subsidiary’s principal suppliers, manufacturers, customers or contractors, which, in either case, would
reasonably be expected to have a Material Adverse Effect.

 

    	 	7	 

    

    

 

(xviii) 
Absence of Proceedings. Except as disclosed in the General Disclosure Package and the Final Offering Memorandum, there
is no action, suit, proceeding, inquiry or investigation before or brought by any Governmental Entity now pending or, to the knowledge
of the Company, threatened, against or affecting the Company or any of its subsidiaries, which would reasonably be expected to
result in a Material Adverse Effect or which would reasonably be expected to materially and adversely affect their respective
properties or assets or the consummation of the transactions contemplated in this Agreement or the performance by the Company
of its obligations hereunder; and the aggregate of all pending legal or governmental proceedings to which the Company or any such
subsidiary is a party or of which any of their respective properties or assets is the subject which are not described in the General
Disclosure Package and the Final Offering Memorandum, including ordinary routine litigation incidental to the business, would
not reasonably be expected to result in a Material Adverse Effect.

 

(xix) 
Absence of Further Requirements. No filing with, or authorization, approval, consent, license, order, registration, qualification
or decree of, any Governmental Entity is necessary or required for the performance by the Company of its obligations hereunder,
in connection with the offering, issuance or sale of the Securities hereunder (including the issuance of any Common Stock upon
conversion thereof), the issuance of any Warrant Securities or the consummation of the transactions contemplated by this Agreement
(including the entry into and performance by the Company under the Call Spread Confirmations) or for the due execution, delivery
and performance of the Indenture and the Securities, except (A) such as have been already obtained, (B) as may be required under
“Blue Sky” or similar securities laws in connection with the purchase and initial sale of the Securities by the Initial
Purchasers in the manner contemplated by this Agreement and in the Final Offering Memorandum or (C) the filing of a current report
on Form 8-K with the Commission under the 1934 Act regarding the transactions contemplated hereby.

 

(xx) 
Possession of Licenses and Permits. The Company and its subsidiaries possess such permits, licenses, approvals, consents
and other authorizations (collectively, “Governmental Licenses”) issued by the appropriate Governmental Entities necessary
to conduct the business now operated by them, except where the failure so to possess would not, singly or in the aggregate, reasonably
be expected to result in a Material Adverse Effect. The Company and its subsidiaries are in compliance with the terms and conditions
of all Governmental Licenses, except where the failure so to comply would not reasonably be expected to, singly or in the aggregate,
result in a Material Adverse Effect. All of the Governmental Licenses are valid and in full force and effect, except when the
invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full force and effect would not,
singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect. Neither the Company nor any of its
subsidiaries has received any notice of proceedings relating to the revocation or modification of any Governmental Licenses necessary
in the operation of its businesses which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding,
would reasonably be expected to result in a Material Adverse Effect.

 

    	 	8	 

    

    

 

(xxi) 
Title to Property. The Company and its subsidiaries have good and marketable title to all real property owned by them and
good title to all other properties owned by them, in each case, free and clear of all mortgages, pledges, liens, security interests,
claims, restrictions or encumbrances of any kind except such as (A) are described in the General Disclosure Package and the Final
Offering Memorandum or (B) would not, singly or in the aggregate, be reasonably expected to result in a Material Adverse Effect;
and all of the leases and subleases material to the business of the Company and its subsidiaries, considered as one enterprise,
and under which the Company or any of its subsidiaries holds properties described in the General Disclosure Package or the Final
Offering Memorandum, are in full force and effect, and neither the Company nor any such subsidiary has received any notice of
any material claim of any sort that has been asserted by anyone adverse to the rights of the Company or any subsidiary under any
of the leases or subleases mentioned above, or affecting or questioning the rights of the Company or such subsidiary to the continued
possession of the leased or subleased premises under any such lease or sublease except, in each case, where it would not reasonably
be expected to have a Material Adverse Effect.

 

(xxii) 
Possession of Intellectual Property. The Company and its subsidiaries own or possess, or can acquire on reasonable terms,
adequate patents, patent rights, licenses, inventions, copyrights, know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or procedures), trademarks, service marks, trade names or other
intellectual property (collectively, “Intellectual Property”) necessary to carry on the business now operated by them
except where the failure to own or have the legal right to use would not reasonably be expected to have a Material Adverse Effect,
and neither the Company nor any of its subsidiaries has received any notice or is otherwise aware of any infringement of or conflict
with asserted rights of others with respect to any Intellectual Property or of any facts or circumstances which would render any
Intellectual Property invalid or inadequate to protect the interest of the Company or any of its subsidiaries therein, and which
infringement or conflict (if the subject of any unfavorable decision, ruling or finding) or invalidity or inadequacy, singly or
in the aggregate, would reasonably be expected to result in a Material Adverse Effect.

 

(xxiii) 
Environmental Laws. Except as described in the General Disclosure Package and the Final Offering Memorandum or would not,
singly or in the aggregate, be reasonably expected to result in a Material Adverse Effect, (A) neither the Company nor any of
its subsidiaries is in violation of any federal, state, local or foreign statute, law, rule, regulation, ordinance, code, policy
or rule of common law or any judicial or administrative interpretation thereof, including any judicial or administrative order,
consent, decree or judgment, relating to pollution or protection of human health from Hazardous Materials, the environment (including,
without limitation, ambient air, surface water, groundwater, land surface or subsurface strata) or wildlife, including, without
limitation, laws and regulations relating to the release or threatened release of hazardous chemicals, pollutants, contaminants,
hazardous wastes, toxic substances, hazardous substances, petroleum or petroleum products, asbestos-containing materials or toxic
mold (collectively, “Hazardous Materials”) or to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials (collectively, “Environmental Laws”), (B) the Company and its
subsidiaries have all permits, authorizations and approvals required under any applicable Environmental Laws and are each in compliance
with their requirements, (C) there are no pending or to the Company’s knowledge, threatened administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens, notices of noncompliance or violation, investigations or proceedings
relating to any Environmental Law against the Company or any of its subsidiaries and (D) to the Company’s knowledge, there
are no events or circumstances that would reasonably be expected to form the basis of an order for clean-up or remediation, or
an action, suit or proceeding by any private party or Governmental Entity, against or affecting the Company or any of its subsidiaries
relating to Hazardous Materials or any Environmental Laws.

 

    	 	9	 

    

    

 

(xxiv) 
Accounting Controls and Disclosure Controls. The Company and subsidiaries maintain effective internal control over financial
reporting framework (as defined under Rule 13-a15 and 15d-15 under the 1934 Act Regulations) and a system of internal accounting
controls sufficient to provide reasonable assurances that (A) transactions are executed in accordance with management’s
general or specific authorization; (B) transactions are recorded as necessary to permit preparation of financial statements in
conformity with GAAP and to maintain accountability for assets; (C) access to assets is permitted only in accordance with management’s
general or specific authorization; (D) the recorded accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences; and (E) the interactive data in eXtensible Business
Reporting Language incorporated by reference in the General Disclosure Package and the Final Offering Memorandum fairly presents
the information called for in all material respects and is prepared in accordance with the Commission's rules and guidelines applicable
thereto. Except as described in the General Disclosure Package and the Final Offering Memorandum, since the end of the Company’s
most recent audited fiscal year, there has been (1) no material weakness in the Company’s internal control over financial
reporting (whether or not remediated) and (2) no change in the Company’s internal control over financial reporting that
has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
The Company and its subsidiaries maintain an effective system of disclosure controls and procedures (as defined in Rule 13a-15
and Rule 15d-15 under the 1934 Act Regulations) that are designed to ensure that information required to be disclosed by the Company
in the reports that it files or submits under the 1934 Act is recorded, processed, summarized and reported, within the time periods
specified in the Commission’s rules and forms, and is accumulated and communicated to the Company’s management, including
its principal executive officer or officers and principal financial officer or officers, as appropriate, to allow timely decisions
regarding disclosure.

 

(xxv) 
Compliance with the Sarbanes-Oxley Act. There is and has been no failure on the part of the Company or, to the knowledge
of the Company. any of the Company’s directors or officers, in their capacities as such, to comply in all material respects
with any applicable provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith,
including Section 402 related to loans and Sections 302 and 906 related to certifications.

 

(xxvi) 
Payment of Taxes. All United States federal income tax returns of the Company and its subsidiaries required by law to be
filed have been filed and all taxes shown by such returns or otherwise assessed, which are due and payable, have been paid, except
assessments against which appeals have been or will be promptly taken and as to which adequate reserves have been provided. The
United States federal income tax returns of the Company through the fiscal year ended December 31, 2016 have been settled and
no assessment in connection therewith has been made against the Company in all material respects. The Company and its subsidiaries
have filed, or obtained extensions of, all other tax returns that are required to have been filed by them pursuant to applicable
foreign, state, local or other law except insofar as the failure to file such returns would not reasonably be expected to result
in a Material Adverse Effect, and has paid all taxes due pursuant to such returns or pursuant to any assessment received by the
Company and its subsidiaries, except for such taxes, if any, as are being contested in good faith and as to which adequate reserves
have been established by the Company or where the failure to pay would not reasonably be expected to have a Material Adverse Effect.
The charges, accruals and reserves on the books of the Company in respect of any income and corporation tax liability for any
years not finally determined are adequate to meet any assessments or re-assessments for additional income tax for any years not
finally determined, except to the extent of any inadequacy that would not reasonably be expected to result in a Material Adverse
Effect.

 

    	 	10	 

    

    

 

(xxvii) 
Insurance. The Company and its subsidiaries carry or are entitled to the benefits of insurance, with financially sound
and reputable insurers, in such amounts and covering such risks as is generally maintained by companies of established repute
engaged in the same or similar business, and all such insurance is in full force and effect. The Company has no reason to believe
that it or any of its subsidiaries will not be able (A) to renew its existing insurance coverage as and when such policies
expire or (B) to obtain comparable coverage from similar institutions as may be necessary or appropriate to conduct its business
as now conducted and at a cost that would not reasonably be expected to result in a Material Adverse Effect.

 

(xxviii) 
Investment Company Act. The Company is not required, and upon the issuance and sale of the Securities as herein contemplated
and the application of the net proceeds therefrom as described in the General Disclosure Package and the Final Offering Memorandum
(including the entry into and performance by the Company under the Call Spread Confirmations) will not be required, to register
as an “investment company” under the Investment Company Act of 1940, as amended (the “1940 Act”).

 

(xxix) 
Absence of Manipulation. Neither the Company nor, to the Company’s knowledge, any affiliate of the Company has taken,
nor will the Company or any affiliate take, directly or indirectly, any action which is designed, or would reasonably be expected,
to cause or result in, or which constitutes, the stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Securities or to result in a violation of Regulation M under the 1934 Act.

 

(xxx) 
Foreign Corrupt Practices Act. (i) None of the Company, any of its subsidiaries or, to the knowledge of the Company, any
director, officer, agent, employee, affiliate or other person acting on behalf of the Company or any of its subsidiaries is aware
of or has taken any action, directly or indirectly, that would result in a violation by such persons of either (A) the Foreign
Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder (the “FCPA”), including, without
limitation, making use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of an offer,
payment, promise to pay or authorization of the payment of any money, or other property, gift, promise to give, or authorization
of the giving of anything of value to any “foreign official” (as such term is defined in the FCPA) or any foreign
political party or official thereof or any candidate for foreign political office, in contravention of the FCPA or (B) the U.K.
Bribery Act 2010 (the “Bribery Act”); and (ii) the Company, its subsidiaries and, to the knowledge of the Company,
its affiliates have conducted their businesses in compliance with the FCPA and the Bribery Act and have instituted and maintain
policies and procedures designed to ensure, and which are reasonably expected to continue to ensure, continued compliance therewith.
No part of the proceeds of the offering of the Securities will be used, directly or, to the knowledge of the Company, indirectly,
in violation of the FCPA or the Bribery Act, each as may be amended, or similar law of any other relevant jurisdiction, or the
rules or regulations thereunder.

 

(xxxi) 
Money Laundering Laws. The operations of the Company and its subsidiaries are and have been conducted at all times in compliance
with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970,
as amended, the money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder and any related
or similar rules, regulations or guidelines, issued, administered or enforced by any Governmental Entity (collectively, the “Money
Laundering Laws”); and no action, suit or proceeding by or before any Governmental Entity involving the Company or any of
its subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of the Company, threatened.

 

    	 	11	 

    

    

 

(xxxii) 
OFAC. None of the Company, any of its subsidiaries or, to the knowledge of the Company, any director, officer, agent, employee,
affiliate or representative of the Company or any of its subsidiaries is an individual or entity (“Person”) currently
the subject or target of any sanctions administered or enforced by the United States Government, including, without limitation,
the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”), the United Nations Security
Council (“UNSC”), the European Union, Her Majesty’s Treasury (“HMT”), or other relevant sanctions
authority (collectively, “Sanctions”), nor is the Company located, organized or resident in a country or territory
that is the subject of Sanctions; and the Company will not directly or indirectly use the proceeds of the sale of the Securities,
or lend, contribute or otherwise make available such proceeds to any subsidiaries, joint venture partners or other Person, to
fund any activities of or business with any Person, or in any country or territory, that, at the time of such funding, is the
subject of Sanctions or in any other manner that will result in a violation by any Person (including any Person participating
in the transaction, whether as underwriter, advisor, investor or otherwise) of Sanctions.

 

(xxxiii) 
Statistical and Market-Related Data. Any statistical and market-related data included in the General Disclosure Package
or the Final Offering Memorandum are based on or derived from sources that the Company believes to be reliable and accurate and,
to the extent required, the Company has obtained the written consent to the use of such data from such sources.

 

SECTION
2.  Sale and Delivery to Initial Purchasers; Closing.

 

(a) 
Initial Securities. On the basis of the representations and warranties herein contained and subject to the terms and conditions
herein set forth, the Company agrees to sell to each Initial Purchaser, severally and not jointly, and each Initial Purchaser,
severally and not jointly, agrees to purchase from the Company, at the price set forth in Schedule A, the aggregate principal
amount of Initial Securities set forth in Schedule A opposite the name of such Initial Purchaser, plus any additional principal
amount of Initial Securities which such Initial Purchaser may become obligated to purchase pursuant to the provisions of Section
11 hereof, subject, in each case, to such adjustments among the Initial Purchasers as the Representatives in their sole discretion
shall make to ensure that any sales or purchases are in authorized denominations.

 

(b) 
Option Securities. In addition, on the basis of the representations and warranties herein contained and subject to the
terms and conditions herein set forth, the Company hereby grants an option to the Initial Purchasers, severally and not jointly,
to purchase the Option Securities, at the price set forth in Schedule A. The option hereby granted may be exercised for 30 days
after the date hereof and may be exercised in whole or in part on one occasion only for the purpose of covering overallotments
made in connection with the offering and distribution of the Initial Securities upon notice by the Representatives to the Company
setting forth the amount of Option Securities as to which the several Initial Purchasers are then exercising the option and the
time and date of payment and delivery for such Option Securities. Any such time and date of delivery (a “Date of Delivery”)
shall be determined by the Representatives, but shall not be later than seven full business days after the exercise of said option,
nor in any event prior to the Closing Time. If the option is exercised as to all or any portion of the Option Securities, each
of the Initial Purchasers, acting severally and not jointly, will purchase that proportion of the total principal amount of Option
Securities then being purchased which the number of Initial Securities set forth in Schedule A opposite the name of such Initial
Purchaser bears to the total principal amount of Initial Securities, subject, in each case, to such adjustments as the Representatives
in their sole discretion shall make to ensure that any sales or purchases are in authorized denominations.

 

    	 	12	 

    

    

 

(c) 
Payment. Payment of the purchase price for, and delivery of certificates or security entitlements for, the Initial Securities
shall be made at the offices of Davis Polk & Wardwell LLP, 450 Lexington Avenue, New York, New York 10017, or at such other
place as shall be agreed upon by the Representatives and the Company, at 9:00 A.M. (New York City time) on the second (third,
if the pricing occurs after 4:30 P.M. (New York City time) on any given day) business day after the date hereof (unless postponed
in accordance with the provisions of Section 11), or such other time not later than ten business days after such date as
shall be agreed upon by the Representatives and the Company (such time and date of payment and delivery being herein called the
“Closing Time”).

 

In
addition, in the event that any or all of the Option Securities are purchased by the Initial Purchasers, payment of the purchase
price for, and delivery of certificates or security entitlements for, such Option Securities shall be made at the above-mentioned
offices, or at such other place as shall be agreed upon by the Representatives and the Company, on each Date of Delivery as specified
in the notice from the Representatives to the Company.

 

Payment
shall be made to the Company by wire transfer of immediately available funds to a bank account designated by the Company against
delivery to the Representatives for the respective accounts of the Initial Purchasers of certificates or security entitlements
for the Securities to be purchased by them. It is understood that each Initial Purchaser has authorized the Representatives, for
their account, to accept delivery of, receipt for, and make payment of the purchase price for, the Initial Securities and the
Option Securities, if any, which it has agreed to purchase. The Representatives, individually and not as representatives of the
Initial Purchasers, may (but shall not be obligated to) make payment of the purchase price for the Initial Securities or the Option
Securities, if any, to be purchased by any Initial Purchaser whose funds have not been received by the Closing Time or the relevant
Date of Delivery, as the case may be, but such payment shall not relieve such Initial Purchaser from its obligations hereunder.

 

SECTION
3.  Covenants of the Company. The Company covenants with each Initial
Purchaser as follows:

 

(a) 
Delivery of Offering Memorandum. The Company has delivered to each Initial Purchaser, without charge, as many copies of
the Preliminary Offering Memorandum (as amended or supplemented) and documents incorporated by reference therein as such Initial
Purchaser reasonably requested, and the Company hereby consents to the use of such copies. The Company will furnish to each Initial
Purchaser, without charge, such number of copies of the Final Offering Memorandum and documents incorporated by reference therein
as such Initial Purchaser may reasonably request.

 

(b) 
Notice and Effect of Material Events. If at any time prior to the completion of the resales of the Securities by the Initial
Purchasers, any event shall occur or condition shall exist as a result of which it is necessary, in the opinion of counsel for
the Initial Purchasers or for the Company, to amend or supplement the General Disclosure Package or the Final Offering Memorandum
in order that the General Disclosure Package or the Final Offering Memorandum, as the case may be, will not include any untrue
statement of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading
in the light of the circumstances existing at the time it is delivered to a Subsequent Purchaser, the Company will promptly (A)
give the Representatives notice of such event and (B) prepare any amendment or supplement as may be necessary to correct such
statement or omission and, a reasonable amount of time prior to any proposed use or distribution, furnish the Representatives
with copies of any such amendment or supplement; provided that the Company shall not use or distribute any such amendment or supplement
to which the Representatives or counsel for the Initial Purchasers shall object. The Company will furnish to the Initial Purchasers
such number of copies of such amendment or supplement as the Initial Purchasers may reasonably request.

 

    	 	13	 

    

    

 

(c) 
Reporting Requirements. Until the completion of initial resales of the Securities by the Initial Purchasers, the Company
will file all documents required to be filed with the Commission pursuant to the 1934 Act within the time periods required by
the 1934 Act and the 1934 Act Regulations. The Company has given the Representatives notice of any filings made pursuant to the
1934 Act or 1934 Act Regulations within 48 hours prior to the Applicable Time; the Company will give the Representatives notice
of its intention to make any such filing from the Applicable Time to the Closing Time and will furnish the Representatives with
copies of any such documents a reasonable amount of time prior to such proposed filing, as the case may be, and will not file
or use any such document to which the Representatives or counsel for the Initial Purchasers shall reasonably object.

 

(d) 
Blue Sky Qualifications. The Company will use its reasonable best efforts, in cooperation with the Initial Purchasers,
to qualify the Securities for offering and sale under the applicable securities laws of such states and other jurisdictions (domestic
or foreign) as the Representatives may designate and to maintain such qualifications in effect so long as required to complete
the distribution of the Securities but no longer than one year after the date hereof; provided, however, that the Company shall
not be obligated to file any general consent to service of process or to qualify as a foreign corporation or as a dealer in securities
in any jurisdiction in which it is not so qualified or to subject itself to taxation in respect of doing business in any jurisdiction
in which it is not otherwise so subject.

 

(e) 
Use of Proceeds. The Company will use the net proceeds received by it from the sale of the Securities in the manner specified
in the General Disclosure Package and the Final Offering Memorandum under “Use of Proceeds.”

 

(f) 
DTCC. The Company will cooperate with the Initial Purchasers and use its reasonable best efforts to permit the offered
Securities to be eligible for clearance and settlement through the facilities of The Depository Trust & Clearing Corporation
(“DTCC”).

 

(g) 
Reservation; Listing. The Company will reserve and keep available at all times, free of pre-emptive rights, a number of
shares of Common Stock equal to the sum of the Maximum Number of Underlying Securities and the Warrant Securities. The Company
will use its reasonable best efforts to effect and maintain the listing of the Maximum Number of Underlying Securities and the
Warrant Securities on the Nasdaq Global Select Market.

 

(h) 
Restriction on Sale of Securities. During a period of 60 days from the date of the Final Offering Memorandum, the Company
will not, without the prior written consent of Merrill Lynch, (i) directly or indirectly, offer, pledge, sell, contract to sell,
sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase
or otherwise transfer or dispose of any shares of Common Stock or any securities convertible into or exercisable or exchangeable
for Common Stock or file or confidentially submit any registration statement under the 1933 Act with respect to any of the foregoing
or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly,
the economic consequence of ownership of the Common Stock, whether any such swap or transaction described in clause (i) or (ii)
above is to be settled by delivery of Common Stock or other securities, in cash or otherwise. The foregoing sentence shall not
apply to (A) the Securities to be sold hereunder or the shares of Common Stock issuable upon conversion of the Securities, (B)
any shares of Common Stock issued by the Company upon the exercise of an option or warrant or the conversion of a security outstanding
on the date hereof and referred to in the General Disclosure Package and the Final Offering Memorandum, (C) any shares of Common
Stock issued or options to purchase Common Stock granted or equity incentive awards granted pursuant to existing employee benefit
plans of the Company referred to in the General Disclosure Package and the Final Offering Memorandum, (D) any shares of Common
Stock issued pursuant to any non-employee director stock plan or dividend reinvestment plan referred to in the General Disclosure
Package and the Final Offering Memorandum, (E) the authorization of an increase in the amount of Common Stock available under
existing employee benefit plans of the Company referred to in the General Disclosure Package and the Final Offering Memorandum
and the related filing of a Registration Statement on Form S-8 to register such shares of Common Stock, (F) the entry into the
Warrant Confirmations, (G) any Common Stock issued upon exercise and settlement or termination of the warrant transactions evidenced
by the Base Warrant Confirmations and any Additional Warrant Confirmations and (H) shares of Common Stock or any securities convertible
into or exercisable or exchangeable for Common Stock issued in connection with acquisitions, joint ventures and similar types
of arrangements of up to 5% of outstanding Common Stock in aggregate at the time of this Agreement, as long as the recipients
of such securities also agree not to sell or transfer those securities without the prior written consent of Merrill Lynch for
a period of 90 days from the date of the Final Offering Memorandum.

 

    	 	14	 

    

    

 

SECTION
4.  Payment of Expenses.

 

(a) 
Expenses. The Company will pay or cause to be paid all expenses incident to the performance of its obligations under this
Agreement, including (i) the preparation, issuance and delivery of the Securities to the Initial Purchasers and the Common Stock
issuable upon conversion thereof and any charges of DTCC in connection therewith, (ii) the preparation, printing and delivery
to the Initial Purchasers of copies of each Preliminary Offering Memorandum, any Issuer Written Information, the Final Term Sheet
and the Final Offering Memorandum and any amendments or supplements thereto and any costs associated with electronic delivery
of any of the foregoing by the Initial Purchasers to investors, (iii) the preparation, issuance and delivery of the certificates
or security entitlements for the Securities to the Initial Purchasers, including any stock or other transfer taxes and any stamp
or other duties payable upon the sale, issuance or delivery of the Securities to the Initial Purchasers, (iv) the fees and disbursements
of the Company’s counsel, accountants and other advisors, (v)  the fees and expenses of the Trustee and of any transfer
agent or registrar for the Securities or the Common Stock issuable upon conversion of the Securities, (vi) the costs and expenses
of the Company relating to investor presentations on any “road show” undertaken in connection with the marketing of
the Securities and (vii) the fees and expenses incurred in connection with the listing of the Maximum Number of Underlying Securities
and the Warrant Securities on the Nasdaq Global Select Market.

 

(b) 
Termination of Agreement. If this Agreement is terminated by the Representatives in accordance with the provisions of Section 5,
Section 10(a)(i) or (iii), or Section 11 hereof, the Company shall reimburse the Initial Purchasers for all of their reasonable
and documented out-of-pocket expenses, including the reasonable fees and disbursements of counsel for the Initial Purchasers.

 

SECTION
5.  Conditions of Initial Purchasers’ Obligations. The obligations
of the several Initial Purchasers hereunder are subject to the accuracy of the representations and warranties of the Company contained
herein or in certificates of any officer of the Company or any of its subsidiaries delivered pursuant to the provisions hereof,
to the performance by the Company of its covenants and other obligations hereunder, and to the following further conditions:

 

(a) 
Opinions of Counsel for Company. At the Closing Time, the Representatives shall have received (i) the favorable opinion,
dated the Closing Time, of McDermott Will & Emery LLP, counsel for the Company in form and substance satisfactory to counsel
for the Initial Purchasers, together with signed or reproduced copies of such letter for each of the other Initial Purchasers;
(ii) a negative assurance letter, dated the Closing Time, of McDermott Will & Emery LLP, counsel for the Company in form and
substance satisfactory to counsel for the Initial Purchasers, together with signed or reproduced copies of such letter for each
of the other Initial Purchasers and (iii) the favorable opinion, dated the Closing Time, of Warrick and Boyn, L.L.P., Indiana
counsel for the Company, in form and substance satisfactory to counsel for the Initial Purchasers, together with signed or reproduced
copies of such letter for each of the other Initial Purchasers, and, in each case, to such further effect as counsel to the Initial
Purchasers may reasonably request. Such counsel may state that, insofar as such opinion involves factual matters, they have relied,
to the extent they deem proper, upon certificates of officers and other representatives of the Company and its subsidiaries and
certificates of public officials.

 

    	 	15	 

    

    

 

(b) 
Opinion of Counsel for Initial Purchasers. At the Closing Time, the Representatives shall have received the favorable opinion,
dated the Closing Time, of Davis Polk & Wardwell LLP, counsel for the Initial Purchasers, together with signed or reproduced
copies of such letter for each of the other Initial Purchasers, with respect to certain matters in form and substance satisfactory
to the Representatives. In giving such opinion such counsel may rely, as to all matters governed by the laws of jurisdictions
other than the law of the State of New York, the General Corporation Law of the State of Delaware and the federal securities laws
of the United States, upon the opinions of counsel satisfactory to the Representatives. Such counsel may also state that, insofar
as such opinion involves factual matters, they have relied, to the extent they deem proper, upon certificates of officers and
other representatives of the Company and its subsidiaries and certificates of public officials.

 

(c) 
Officers’ Certificate. At the Closing Time, there shall not have been, since the date hereof or since the respective
dates as of which information is given in the General Disclosure Package or the Final Offering Memorandum, any Material Adverse
Effect, and the Representatives shall have received a certificate of the Chief Executive Officer or the President of the Company
and of the chief financial or chief accounting officer of the Company, dated the Closing Time in their capacity as officers of
the Company, to the effect that (i) there has been no such Material Adverse Effect, (ii) the representations and warranties
of the Company in this Agreement are true and correct with the same force and effect as though expressly made at and as of the
Closing Time, and (iii) the Company has complied with all agreements and satisfied all conditions on its part to be performed
or satisfied at or prior to the Closing Time.

 

(d) 
Accountant’s Comfort Letter. At the time of the execution of this Agreement, the Representatives shall have received
from Crowe Horwath LLP a letter, dated such date, in form and substance satisfactory to the Representatives, together with signed
or reproduced copies of such letter for each of the other Initial Purchasers, containing statements and information of the type
ordinarily included in accountants’ “comfort letters” to Initial Purchasers with respect to the financial statements
and certain financial information contained in the General Disclosure Package and the Offering Memorandum.

 

(e) 
Bring-down Comfort Letter. At the Closing Time, the Representatives shall have received from Crowe Horwath LLP a letter,
dated as of the Closing Time, to the effect that they reaffirm the statements made in the letter furnished pursuant to subsection
(d) of this Section, except that the specified date referred to shall be a date not more than three business days prior to the
Closing Time.

 

(f) 
Approval of Listing. At the Closing Time, the Maximum Number of Underlying Securities and the Warrant Securities shall
have been approved for listing on the Nasdaq Global Select Market, subject only to official notice of issuance.

 

(g) 
Lock-up Agreements. At the date of this Agreement, the Representatives shall have received an agreement substantially in
the form of Exhibit A hereto signed by the persons listed on Schedule D hereto.

 

(h) 
Maintenance of Rating. Neither the Company nor its subsidiaries have any debt securities or preferred stock that are rated
by any “nationally recognized statistical rating organization” (as defined in Section 3(a)(62) of the 1934 Act.

 

    	 	16	 

    

    

 

(i) 
Conditions to Purchase of Option Securities. In the event that the Initial Purchasers exercise their option provided in
Section 2(b) hereof to purchase all or any portion of the Option Securities, the representations and warranties of the Company
contained herein and the statements in any certificates furnished by the Company, any of its subsidiaries hereunder shall be true
and correct as of each Date of Delivery and, at the relevant Date of Delivery, the Representatives shall have received:

 

(i) Officers’
Certificate. A certificate, dated such Date of Delivery, of the President or a Vice President of the Company and of the chief
financial or chief accounting officer of the Company confirming that the certificate delivered at the Closing Time pursuant to
Section 5(c) hereof remains true and correct as of such Date of Delivery.

 

(ii) Opinion
of Counsel for the Company. If requested by the Representatives, (i) the favorable opinion of McDermott Will & Emery LLP,
counsel for the Company; (ii) a negative assurance letter of McDermott Will & Emery LLP, counsel for the Company and (iii)
the favorable opinion of Warrick and Boyn, L.L.P., Indiana counsel for the Company, each in form and substance satisfactory to
counsel for the Initial Purchasers and dated such Date of Delivery, relating to the Option Securities to be purchased on such
Date of Delivery and otherwise to the same effect as the opinions required by Section 5(a) hereof.

 

(iii) Opinion
of Counsel for Initial Purchasers. If requested by the Representatives, the favorable opinion of Davis Polk & Wardwell
LLP, counsel for the Initial Purchasers, dated such Date of Delivery, relating to the Option Securities to be purchased on such
Date of Delivery and otherwise to the same effect as the opinion required by Section 5(b) hereof.

 

(vi) Bring-down
Comfort Letter. If requested by the Representatives, a letter from Crowe Horwath LLP, in form and substance satisfactory to
the Representatives and dated such Date of Delivery, substantially in the same form and substance as the letter furnished to the
Representatives pursuant to Section 5(d) hereof, except that the “specified date” in the letter furnished pursuant
to this paragraph shall be a date not more than three business days prior to such Date of Delivery.

 

(j) 
Additional Documents. At the Closing Time and at each Date of Delivery (if any) counsel for the Initial Purchasers shall
have been furnished with such customary documents and opinions as they may reasonably require for the purpose of enabling them
to pass upon the issuance and sale of the Securities as herein contemplated, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the conditions, herein contained; and all proceedings taken by the
Company in connection with the issuance and sale of the Securities as herein contemplated shall be reasonably satisfactory in
form and substance to the Representatives and counsel for the Initial Purchasers.

 

(k) 
Termination of Agreement. If any condition specified in this Section shall not have been fulfilled when and as required
to be fulfilled, this Agreement, or, in the case of any condition to the purchase of Option Securities on a Date of Delivery which
is after the Closing Time, the obligations of the several Initial Purchasers to purchase the relevant Option Securities, may be
terminated by the Representatives by notice to the Company at any time at or prior to Closing Time or such Date of Delivery, as
the case may be, and such termination shall be without liability of any party to any other party except as provided in Section
4 and except that Sections 1, 7, 8, 9, 15, 16 and 17 shall survive any such termination and remain in full force and effect.

 

    	 	17	 

    

    

 

SECTION
6.  Subsequent Offers and Resales of the Securities.

 

(a) 
Offer and Sale Procedures. Each of the Initial Purchasers and the Company hereby establish and agree to observe the following
procedures in connection with the offer and sale of the Securities:

 

(i) 
Offers and Sales. Offers and sales of the Securities shall be made to such persons and in such manner as is contemplated
by the Offering Memorandum. Each Initial Purchaser severally agrees that it will not offer, sell or deliver any of the Securities
in any jurisdiction outside the United States except under circumstances that will result in compliance with the applicable laws
thereof, and that it will take at its own expense whatever action is required to permit its purchase and resale of the Securities
in such jurisdictions. The Company has not entered into any contractual arrangement, other than this Agreement and the other agreements
and instruments contemplated hereby and by the General Disclosure Package and the Final Offering Memorandum, with respect to the
distribution of the Securities or the Common Stock issuable upon conversion of the Securities and the Company will not enter into
any such arrangement except as contemplated hereby and thereby.

 

(ii) 
No General Solicitation. No general solicitation or general advertising (within the meaning of Rule 502(c) under the
1933 Act Regulations) will be used in the United States in connection with the offering or sale of the Securities.

 

(iii) 
Legends. Each of the Securities will bear, to the extent applicable, the legend contained in “Transfer restrictions”
in the General Disclosure Package and the Final Offering Memorandum for the time period and upon the other terms stated therein.

 

(iv) Minimum
Principal Amount. No sale of the Securities to any one Subsequent Purchaser will be for less than U.S. $1,000 principal amount
and no Security will be issued in a smaller principal amount.

 

(b) 
Covenants of the Company. The Company covenants with each Initial Purchaser as follows:

 

(i) Integration.
The Company agrees that it will not and will cause its Affiliates not to, directly or indirectly, solicit any offer to buy, sell
or make any offer or sale of, or otherwise negotiate in respect of, securities of the Company of any class if, as a result of
the doctrine of “integration” referred to in Rule 502 under the 1933 Act Regulations, such offer or sale
would render invalid (for the purpose of (i) the sale of the offered Securities by the Company to the Initial Purchasers,
(ii) the resale of the offered Securities by the Initial Purchasers to Subsequent Purchasers or (iii) the resale of
the offered Securities by such Subsequent Purchasers to others) the exemption from the registration requirements of the 1933 Act
provided by Section 4(a)(2) thereof or by Rule 144A thereunder or otherwise.

 

(ii) Rule
144A Information. The Company agrees that, in order to render the offered Securities eligible for resale pursuant to Rule 144A,
while any of the offered Securities remain outstanding, it will make available, upon request, to any holder of offered Securities
or prospective purchasers of Securities the information specified in Rule 144A(d)(4), unless the Company furnishes information
to the Commission pursuant to Section 13 or 15(d) of the 1934 Act.

 

(iii) Restriction
on Repurchases. Until the expiration of thirteen months after the original issuance of the offered Securities, the Company
will not, and will cause its Affiliates not to, resell any offered Securities which are “restricted securities” (as
such term is defined under Rule 144(a)(3)), whether as beneficial owner or otherwise (except as agent acting as a securities
broker on behalf of and for the account of customers in the ordinary course of business in unsolicited broker’s transactions).

 

    	 	18	 

    

    

 

(c) 
Representations, Warranties and Agreements of the Initial Purchasers. Each Initial Purchaser severally and not jointly
represents and warrants to, and agrees with, the Company that it is a Qualified Institutional Buyer and an “accredited investor”
within the meaning of Rule 501(a) under the 1933 Act Regulations. Each Initial Purchaser understands that the offered
Securities have not been and will not be registered under the 1933 Act and may not be offered or sold within the United States
except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the 1933 Act.
Each Initial Purchaser severally represents and agrees that it has not offered or sold, and will not offer or sell, any offered
Securities constituting part of its allotment within the United States except in accordance with Rule 144A or another applicable
exemption from the registration requirements of the 1933 Act. Accordingly, neither it nor any person acting on its behalf
has made or will make offers or sales of the Securities in the United States by means of any form of general solicitation or general
advertising (within the meaning of Regulation D) in the United States. Each Initial Purchaser will take reasonable steps to inform,
and cause each of its affiliates (as such term is defined in Rule 501(b) under the 1933 Act Regulations (each, an “Affiliate”))
to take reasonable steps to inform, persons acquiring Securities from such Initial Purchaser or Affiliate, as the case may be,
in the United States that the Securities (A) have not been and will not be registered under the 1933 Act, (B) are
being sold to them without registration under the 1933 Act in reliance on Rule 144A or in accordance with another exemption
from registration under the 1933 Act, as the case may be, and (C) may not be offered, sold or otherwise transferred
except (1) to the Company, (2) in accordance with Rule 144A to a person whom the seller reasonably believes is a Qualified
Institutional Buyer that is purchasing such Securities for its own account or for the account of a Qualified Institutional Buyer
to whom notice is given that the offer, sale or transfer is being made in reliance on Rule 144A or (3) pursuant to another
available exemption from registration under the 1933 Act.

 

SECTION
7.  Indemnification.

 

(a) 
Indemnification of Initial Purchasers. The Company agrees to indemnify and hold harmless each Initial Purchaser, its Affiliates,
its selling agents and each person, if any, who controls any Initial Purchaser within the meaning of Section 15 of the 1933
Act or Section 20 of the 1934 Act as follows:

 

(i) against
any and all loss, liability, claim, damage and expense whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact included (A) in any Preliminary Offering Memorandum, the Final Offering Memorandum, the information
contained in the Final Term Sheet, any Issuer Written Information (or any amendment or supplement to the foregoing) or (B) in
any materials or information provided to investors by, or with the approval of, the Company in connection with the marketing of
the offering of the Securities (“Marketing Materials”), including any roadshow or investor presentations made to investors
by the Company (whether in person or electronically), or the omission or alleged omission in any Preliminary Offering Memorandum,
the Final Offering Memorandum, the Final Term Sheet, any Issuer Written Information (or any amendment or supplement to the foregoing),
the information contained in the Final Term Sheet or in any Marketing Materials of a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were made, not misleading;

 

(ii) against
any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission;
provided that (subject to Section 7(d) below) any such settlement is effected with the written consent of the Company;

 

(iii) against
any and all expense whatsoever, as incurred (including the reasonable fees and disbursements of counsel chosen by the Representatives),
reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission,
or any such alleged untrue statement or omission, to the extent that any such expense is not paid under (i) or (ii) above;

 

provided,
however, that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising
out of any untrue statement or omission or alleged untrue statement or omission made in the General Disclosure Package, any Preliminary
Offering Memorandum or the Final Offering Memorandum (or any amendment or supplement to the foregoing) in reliance upon and in
conformity with the Initial Purchaser Information.

 

    	 	19	 

    

    

  

(b) Indemnification
of Company, Directors and Officers. Each Initial Purchaser severally agrees to indemnify and hold harmless the Company, its
directors, its officers and each person, if any, who controls the Company within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act, against any and all loss, liability, claim, damage and expense described in the indemnity contained
in subsection (a) of this Section, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements
or omissions, made in the General Disclosure Package, any Preliminary Offering Memorandum or the Final Offering Memorandum (or
any amendment or supplement to the foregoing) in reliance upon and in conformity with the Initial Purchaser Information.

 

(c) Actions
against Parties; Notification. Each indemnified party shall give notice as promptly as reasonably practicable to each indemnifying
party of any action commenced against it in respect of which indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve such indemnifying party from any liability hereunder to the extent it is not materially prejudiced as
a result thereof and in any event shall not relieve it from any liability which it may have otherwise than on account of this
indemnity agreement. In the case of parties indemnified pursuant to Section 7(a) above, counsel to the indemnified parties shall
be selected by the Representatives, and, in the case of parties indemnified pursuant to Section 7(b) above, counsel to the indemnified
parties shall be selected by the Company. An indemnifying party may participate at its own expense in the defense of any such
action; provided, however, that counsel to the indemnifying party shall not (except with the consent of the indemnified party)
also be counsel to the indemnified party. In no event shall the indemnifying parties be liable for fees and expenses of more than
one counsel (in addition to any local counsel) separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations
or circumstances. No indemnifying party shall, without the prior written consent of the indemnified parties, settle or compromise
or consent to the entry of any judgment with respect to any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever in respect of which indemnification or contribution could be
sought under this Section 7 or Section 8 hereof (whether or not the indemnified parties are actual or potential parties thereto),
unless such settlement, compromise or consent (i) includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim and (ii) does not include a statement as to or an admission
of fault, culpability or a failure to act by or on behalf of any indemnified party.

 

(d) Settlement
without Consent if Failure to Reimburse. If at any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by Section 7(a)(ii) effected without its written consent if (i) such settlement is entered
into more than 45 days after receipt by such indemnifying party of the aforesaid request, (ii) such indemnifying party shall have
received notice of the terms of such settlement at least 30 days prior to such settlement being entered into and (iii) such indemnifying
party shall not have reimbursed such indemnified party in accordance with such request prior to the date of such settlement.

 

    	 	20	 

    

    

 

SECTION
8.  Contribution. If the indemnification provided for in Section 7
hereof is for any reason unavailable to or insufficient to hold harmless an indemnified party in respect of any losses, liabilities,
claims, damages or expenses referred to therein, then each indemnifying party shall contribute to the aggregate amount of such
losses, liabilities, claims, damages and expenses incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company, on the one hand, and the Initial Purchasers, on the other
hand, from the offering of the Securities pursuant to this Agreement or (ii) if the allocation provided by clause (i) is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above
but also the relative fault of the Company, on the one hand, and of the Initial Purchasers, on the other hand, in connection with
the statements or omissions which resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.

 

The
relative benefits received by the Company, on the one hand, and the Initial Purchasers, on the other hand, in connection with
the offering of the Securities pursuant to this Agreement shall be deemed to be in the same respective proportions as the total
net proceeds from the offering of the Securities pursuant to this Agreement (before deducting expenses) received by the Company,
on the one hand, and the total underwriting discount received by the Initial Purchasers, on the other hand, bear to the aggregate
initial offering price of the Securities as set forth on the cover of the Final Offering Memorandum.

 

The
relative fault of the Company, on the one hand, and the Initial Purchasers, on the other hand, shall be determined by reference
to, among other things, whether any such untrue or alleged untrue statement of a material fact or omission or alleged omission
to state a material fact relates to information supplied by the Company or by the Initial Purchasers and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

 

The
Company and the Initial Purchasers agree that it would not be just and equitable if contribution pursuant to this Section 8 were
determined by pro rata allocation (even if the Initial Purchasers were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable considerations referred to above in this Section 8. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an indemnified party and referred to above in this Section
8 shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in investigating, preparing
or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened,
or any claim whatsoever based upon any such untrue or alleged untrue statement or omission or alleged omission.

 

Notwithstanding
the provisions of this Section 8, no Initial Purchaser shall be required to contribute any amount in excess of the amount by which
the total price at which the Securities purchased by it and distributed to the public were offered to the public exceeds the amount
of any damages that such Initial Purchaser has otherwise been required to pay by reason of any such untrue or alleged untrue statement
or omission or alleged omission.

 

No
person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.

 

For
purposes of this Section 8, each person, if any, who controls an Initial Purchaser within the meaning of Section 15 of the 1933
Act or Section 20 of the 1934 Act and each Initial Purchaser’s Affiliates and selling agents shall have the same rights
to contribution as such Initial Purchaser, and each director of the Company, each officer of the Company, and each person, if
any, who controls the Company within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same
rights to contribution as the Company. The Initial Purchasers’ respective obligations to contribute pursuant to this Section
8 are several in proportion to the aggregate principal amount of Initial Securities set forth opposite their respective names
in Schedule A hereto and not joint.

 

    	 	21	 

    

    

 

SECTION
9.  Representations, Warranties and Agreements to Survive. All representations,
warranties and agreements contained in this Agreement or in certificates of officers of the Company or any of its subsidiaries
submitted pursuant hereto, shall remain operative and in full force and effect regardless of (i) any investigation made by or
on behalf of any Initial Purchaser or its Affiliates or selling agents, any person controlling any Initial Purchaser, its officers
or directors, any person controlling the Company and (ii) delivery of and payment for the Securities.

 

SECTION
10.  Termination of Agreement.

 

(a) 
Termination. The Representatives may terminate this Agreement, by notice to the Company, at any time at or prior to the
Closing Time (i) if there has been, in the judgment of the Representatives, since the time of execution of this Agreement or since
the respective dates as of which information is given in the General Disclosure Package or the Final Offering Memorandum, any
Material Adverse Effect, or (ii) if there has occurred any material adverse change in the financial markets in the United
States or the international financial markets, any outbreak of hostilities or escalation thereof or other calamity or crisis or
any change or development involving a prospective change in national or international political, financial or economic conditions,
in each case the effect of which is such as to make it, in the judgment of the Representatives, impracticable or inadvisable to
proceed with the completion of the offering or to enforce contracts for the sale of the Securities, or (iii) if trading in
any securities of the Company has been suspended or materially limited by the Commission or the Nasdaq Global Select Market, or
(iv) if trading generally on the NYSE MKT or the New York Stock Exchange or in the Nasdaq Global Market has been suspended or
materially limited, or minimum or maximum prices for trading have been fixed, or maximum ranges for prices have been required,
by any of said exchanges or by order of the Commission, FINRA or any other governmental authority, or (v) a material disruption
has occurred in commercial banking or securities settlement or clearance services in the United States or with respect to Clearstream
or Euroclear systems in Europe, or (vi) if a banking moratorium has been declared by either Federal or New York authorities.

 

(b) 
Liabilities. If this Agreement is terminated pursuant to this Section, such termination shall be without liability of any
party to any other party except as provided in Section 4 hereof, and provided further that Sections 1, 7, 8, 9, 15, 16 and 17
shall survive such termination and remain in full force and effect.

 

SECTION
11.  Default by One or More of the Initial Purchasers. If one or more of the Initial Purchasers
shall fail at the Closing Time or a Date of Delivery to purchase the Securities which it or they are obligated to purchase under
this Agreement (the “Defaulted Securities”), the Representatives shall have the right, within 24 hours thereafter,
to make arrangements for one or more of the non-defaulting Initial Purchasers, or any other initial purchasers, to purchase all,
but not less than all, of the Defaulted Securities in such amounts as may be agreed upon and upon the terms herein set forth;
if, however, the Representatives shall not have completed such arrangements within such 24-hour period, then:

 

(i) 
if the number of Defaulted Securities does not exceed 10% of the aggregate principal amount of the Securities to be purchased
on such date, each of the non-defaulting Initial Purchasers shall be obligated, severally and not jointly, to purchase the full
amount thereof in the proportions that their respective underwriting obligations hereunder bear to the underwriting obligations
of all non-defaulting Initial Purchasers, or

 

    	 	22	 

    

    

 

(ii) 
if the number of Defaulted Securities exceeds 10% of the aggregate principal amount of the Securities to be purchased on such
date, this Agreement or, with respect to any Date of Delivery which occurs after the Closing Time, the obligation of the Initial
Purchasers to purchase, and the Company to sell, the Option Securities to be purchased and sold on such Date of Delivery shall
terminate without liability on the part of any non-defaulting Initial Purchaser except that the provisions of Sections 1, 7, 8,
9, 15, 16 and 17 shall remain in full force and effect.

 

No
action taken pursuant to this Section shall relieve any defaulting Initial Purchaser from liability in respect of its default.

 

In
the event of any such default which does not result in a termination of this Agreement or, in the case of a Date of Delivery which
is after the Closing Time, which does not result in a termination of the obligation of the Initial Purchasers to purchase and
the Company to sell the relevant Option Securities, as the case may be, either (i) the Representatives or (ii) the Company shall
have the right to postpone the Closing Time or the relevant Date of Delivery, as the case may be, for a period not exceeding seven
days in order to effect any required changes in the General Disclosure Package or the Final Offering Memorandum or in any other
documents or arrangements. As used herein, the term “Initial Purchaser” includes any person substituted for an Initial
Purchaser under this Section 11.

 

SECTION
12.  Notices. All notices and other communications hereunder shall be in writing and shall
be deemed to have been duly given if mailed or transmitted by any standard form of telecommunication. Notices to the Initial Purchasers
shall be directed to Merrill Lynch at One Bryant Park, New York, New York 10036, attention of Syndicate Department (facsimile:
(646) 855-3073), with a copy to ECM Legal (facsimile: (212) 230-8730) and to Wells Fargo at 375 Park Avenue, New York, New York
10152, Attention: Equity Syndicate Department (facsimile: (212) 214-5918); and notices to the Company shall be directed to it
at Patrick Industries, Inc., 107 West Franklin Street, P.O. Box 638, Elkhart, Indiana 46515, attention of Todd Cleveland, Chief
Executive Officer (facsimile: (574) 524-7915), with a copy to McDermott Will & Emery LLP, 444 West Lake Street, Chicago, IL
60606-0029, attention of Robert Schreck (facsimile: 312 984 7700).

 

SECTION
13.  No Advisory or Fiduciary Relationship. The Company acknowledges and agrees that (a) the
purchase and sale of the Securities pursuant to this Agreement, including the determination of the initial offering price of the
Securities and any related discounts and commissions, is an arm’s-length commercial transaction between the Company, on
the one hand, and the several Initial Purchasers, on the other hand, (b) in connection with the offering of the Securities and
the process leading thereto, each Initial Purchaser is and has been acting solely as a principal and is not the agent or fiduciary
of the Company, any of its subsidiaries, or its respective stockholders, creditors, employees or any other party, (c) no Initial
Purchaser has assumed or will assume an advisory or fiduciary responsibility in favor of the Company with respect to the offering
of the Securities or the process leading thereto (irrespective of whether such Initial Purchaser has advised or is currently advising
the Company or any of its subsidiaries on other matters) and no Initial Purchaser has any obligation to the Company with respect
to the offering of the Securities except the obligations expressly set forth in this Agreement, (d) the Initial Purchasers and
their respective affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the
Company, and (e) the Initial Purchasers have not provided any legal, accounting, regulatory or tax advice with respect to the
offering of the Securities and the Company has consulted its own respective legal, accounting, regulatory and tax advisors to
the extent it deemed appropriate.

 

    	 	23	 

    

    

 

SECTION
14.  Parties. This Agreement shall inure to the benefit of and be binding upon the Initial
Purchasers, the Company and their respective successors. Nothing expressed or mentioned in this Agreement is intended or shall
be construed to give any person, firm or corporation, other than the Initial Purchasers, the Company and their respective successors
and the controlling persons and officers and directors referred to in Sections 7 and 8 and their heirs and legal representatives,
any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained. This Agreement
and all conditions and provisions hereof are intended to be for the sole and exclusive benefit of the Initial Purchasers, the
Company and their respective successors, and said controlling persons and officers and directors and their heirs and legal representatives,
and for the benefit of no other person, firm or corporation. No purchaser of Securities from any Initial Purchaser shall be deemed
to be a successor by reason merely of such purchase.

 

SECTION
15.  Trial by Jury. The Company (on its behalf and, to the extent permitted by applicable
law, on behalf of its stockholders and affiliates) and each of the Initial Purchasers hereby irrevocably waives, to the fullest
extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this
Agreement or the transactions contemplated hereby.

 

SECTION
16.  GOVERNING LAW. THIS AGREEMENT AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR
RELATED TO THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF, THE STATE OF NEW YORK WITHOUT REGARD
TO ITS CHOICE OF LAW PROVISIONS.

 

SECTION
17.  Consent to Jurisdiction; Waiver of Immunity. Any legal suit, action or proceeding arising
out of or based upon this Agreement or the transactions contemplated hereby (“Related Proceedings”) shall be
instituted in (i) the federal courts of the United States of America located in the City and County of New York, Borough of Manhattan
or (ii) the courts of the State of New York located in the City and County of New York, Borough of Manhattan (collectively,
the “Specified Courts”), and each party irrevocably submits to the exclusive jurisdiction (except for proceedings
instituted in regard to the enforcement of a judgment of any such court (a “Related Judgment”), as to which such jurisdiction
is non-exclusive) of such courts in any such suit, action or proceeding. Service of any process, summons, notice or document by
mail to such party’s address set forth above shall be effective service of process for any suit, action or other proceeding
brought in any such court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any suit,
action or other proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in
any such court that any such suit, action or other proceeding brought in any such court has been brought in an inconvenient forum.

 

SECTION
18.  TIME. TIME SHALL BE OF THE ESSENCE OF THIS AGREEMENT. EXCEPT AS OTHERWISE SET FORTH HEREIN,
SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.

 

SECTION
19.  Counterparts. This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original, but all such counterparts shall together constitute one and the same Agreement.

 

SECTION
20.  Effect of Headings. The Section headings herein are for convenience only and shall not
affect the construction hereof.

 

If
the foregoing is in accordance with your understanding of our agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding agreement among the Initial Purchasers and the Company
in accordance with its terms.

 

    	 	24	 

    

    

 

	 	Very
    truly yours,
	 	 
	 	PATRICK
    INDUSTRIES, INC.
	 	 	 
	 	By:
    	/s/
    Todd M. Cleveland
	 	 	 
	 	Title:  
    	CEO

 

    	 	25	 

    

    

 

CONFIRMED AND ACCEPTED,

as of the date first above written:

 

MERRILL
LYNCH, PIERCE, FENNER & SMITH

INCORPORATED

 Wells
Fargo Securities, LLC

 

	BY:	MERRILL LYNCH, PIERCE, FENNER & SMITH
	 	INCORPORATED	 
	 	 	 
	By
    	/s/
    Kevin Brillhart	 
	 	Authorized
    Signatory	 
	 	 	 
	BY:	WELLS
    FARGO SECURITIES, LLC	 
	 	 	 
	By
    	/s/
    Shiv Vasisht	 
	 	Athorized
    Signatory	 

 

For
themselves and as Representatives of the other Initial Purchasers named in Schedule A hereto.

 

    	 	26	 

    

    

 

SCHEDULE
A

 

The
initial offering price of the Securities shall be 100.00% of the principal amount thereof, plus accrued interest, if any, from
the date of issuance.

 

The
purchase price to be paid by the Initial Purchasers for the Securities shall be 97.25% of the principal amount thereof.

 

The
interest rate on the Securities shall be 1.00% per annum.

 

	 	 	Principal Amount of	 
	Name of Initial Purchaser	 	Securities	 
	 	 	 	 
	Merrill Lynch, Pierce, Fenner & Smith Incorporated	 	$	75,000,000	 
	Wells Fargo Securities, LLC	 	$	52,500,000	 
	KeyBanc Capital Markets Inc.	 	$	6,450,000	 
	Fifth Third Securities, Inc.	 	$	6,375,000	 
	U.S. Bancorp Investments, Inc.	 	$	6,375,000	 
	Robert W. Baird & Co. Incorporated	 	$	825,000	 
	CJS Securities, Inc.	 	$	825,000	 
	C.L. King & Associates, Inc.	 	$	825,000	 
	Sidoti & Company, LLC	 	$	825,000	 
	Total	 	$	150,000,000	 

  

Sch A-1

     

    

    

 

SCHEDULE
B

 

Final
Term Sheet

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sch B-1

     

    

    

 

	PRICING TERM SHEET	STRICTLY CONFIDENTIAL

 

DATED
January 17, 2018

 

 

 

Patrick
Industries, INC.

 

$150,000,000

 

1.00%
CONVERTIBLE SENIOR NOTES DUE 2023

 

The
information in this pricing term sheet supplements Patrick Industries, Inc.’s preliminary offering memorandum, dated January
16, 2018 (the “Preliminary Offering Memorandum”), and supersedes the information in the Preliminary Offering Memorandum
to the extent inconsistent with the information in the Preliminary Offering Memorandum. In all other respects, this pricing term
sheet is qualified in its entirety by reference to the Preliminary Offering Memorandum, including all documents incorporated by
reference therein. Terms used herein but not defined herein shall have the respective meanings as set forth in the Preliminary
Offering Memorandum. All references to dollar amounts are references to U.S. dollars. Patrick Industries, Inc. has increased the
size of the offering to $150,000,000 (or $172,500,000 if the initial purchasers exercise their over-allotment option to purchase
additional Notes in full). The final offering memorandum relating to the offering will reflect conforming changes relating to
such increase in the size of the offering.

  

	Issuer:	 	Patrick
    Industries, Inc., an Indiana corporation. 
	 	 	 
	Ticker/Exchange
    for the Issuer’s Common Stock:	 	

        “PATK”/The
        Nasdaq Global Select Market.

	 	 	 
	Notes:	 	1.00%
    Convertible Senior Notes due 2023.
	 	 	 
	Principal
    Amount:	 	$150,000,000,
    plus up to an additional $22,500,000 principal amount pursuant to the initial purchasers’ over-allotment option.
	 	 	 
	Denominations:	 	$1,000
    and integral multiples of $1,000 in excess thereof.
	 	 	 
	Maturity:	 	February
    1, 2023, unless earlier repurchased or converted.
	 	 	 
	Interest
    Rate: 	 	1.00%
    per year. 
	 	 	 
	Interest
    Payment Dates:	 	Interest
    will accrue from January 22, 2018 and will be payable semiannually in arrears on February 1 and August 1 of each year, beginning
    on August 1, 2018.
	 	 	 
	Interest
    Record Dates:	 	January
    15 and July 15 of each year, immediately preceding any February 1 or August 1 interest payment date, as the case may be. 
	 	 	 
	Issue
    Price:	 	100%
    of principal, plus accrued interest, if any, from the Settlement Date.
	 	 	 
	Trade
    Date:	 	January
    18, 2018.
	 	 	 
	Settlement
    Date:	 	January
    22, 2018.

 

Sch B-2

     

    

    

 

	Last
    Reported Sale Price of the Issuer’s Common Stock on January 17, 2018:	 	

        $65.10
        per share.

	 	 	 
	Initial
    Conversion Rate:	 	11.3785
    shares of the Issuer’s common stock per $1,000 principal amount of Notes.
	 	 	 
	Initial
    Conversion Price:	 	Approximately
    $87.89 per share of the Issuer’s common stock.
	 	 	 
	Conversion
    Premium:	 	Approximately
    35.0% above the last reported sale price of the Issuer’s common stock on January 17, 2018.
	 	 	 
	Joint
    Book-Running Managers:	 	Merrill
Lynch, Pierce, Fenner & Smith

        Incorporated 

        Wells
Fargo Securities, LLC

	 	 	 
	Co-Managers:	 	U.S.
Bancorp Investments, Inc.

        Fifth
Third Securities, Inc.

        KeyBanc
Capital Markets Inc.

        C.L.
King & Associates, Inc.

        CJS
Securities, Inc.

        Sidoti
        & Company, LLC

	 	 	 
	CUSIP
    Number (144A):	 	703343AA1
	 	 	 
	ISIN
    (144A):	 	US703343AA11

 

	Use
    of Proceeds:	 	The
        Issuer estimates that the net proceeds from the offering will be approximately $145.1 million (or $167.0 million if the
        initial purchasers exercise their over-allotment option in full), after deducting fees and estimated expenses.

         

        The
        Issuer has entered into convertible note hedge transactions with certain of the initial purchasers and/or their respective
        affiliates (the “option counterparties”). The Issuer has also entered into warrant transactions with the option
        counterparties. The Issuer intends to use approximately $11.6 million of the net proceeds from the offering to pay the
        cost of the convertible note hedge transactions (after such cost is partially offset by the proceeds to the Issuer from
        the sale of the warrant transactions). The Issuer intends to use the remainder of the net proceeds from the offering in
        alignment with its capital allocation strategy, which includes funding future potential acquisitions, investing in its
        infrastructure through strategic capital expenditures and expansions and for general corporate purposes. Pending these
        uses, the Issuer intends to use the remainder of the net proceeds from the offering to repay a portion of the amounts
        due under its 2015 Credit Agreement (as defined in the Preliminary Offering Memorandum). See “Use of Proceeds”
        in the Preliminary Offering Memorandum.

         

        If
        the initial purchasers exercise their over-allotment option, the Issuer expects to sell additional warrants to the option
        counterparties and use a portion of the net proceeds from the sale of the additional Notes, together with the proceeds
        from the additional warrants, to enter into additional convertible note hedge transactions with the option counterparties
        and for general corporate purposes.

 

Sch B-3

     

    

    

 

	Increase
    in Conversion Rate Upon Conversion in Connection with a Make-Whole Fundamental Change:	 	Following
        the occurrence of a “make-whole fundamental change” (as defined in the Preliminary Offering Memorandum), the
        Issuer will increase the Conversion Rate for a holder who elects to convert its Notes in connection with such make-whole
        fundamental change in certain circumstances, as described under “Description of Notes—Conversion Rights—Increase
        in conversion rate upon conversion upon a make-whole fundamental change” in the Preliminary Offering Memorandum.

         

        The
        following table sets forth the number of additional shares by which the Conversion Rate will be increased per $1,000 principal
        amount of Notes for conversions in connection with a make-whole fundamental change for each “stock price”
        and “effective date” set forth below:

 

 

Stock
Price

 

	Effective Date	 	$	65.10	 	 	$	70.00	 	 	$	80.00	 	 	$	87.89	 	 	$	100.00	 	 	$	125.00	 	 	$	150.00	 	 	$	250.00	 	 	$	275.00	 	 	$	300.00	 	 	$	325.00	 	 	$	350.00	 	 	$	375.00	 	 	$	400.00	 	 	$	450.00	 
	January 22, 2018	 	 	3.9824	 	 	 	3.3992	 	 	 	2.5097	 	 	 	2.0070	 	 	 	1.4574	 	 	 	0.8089	 	 	 	0.4836	 	 	 	0.0903	 	 	 	0.0624	 	 	 	0.0440	 	 	 	0.0304	 	 	 	0.0205	 	 	 	0.0133	 	 	 	0.0081	 	 	 	0.0016	 
	February 1, 2019	 	 	3.9824	 	 	 	3.3770	 	 	 	2.4387	 	 	 	1.9154	 	 	 	1.3523	 	 	 	0.7098	 	 	 	0.4038	 	 	 	0.0662	 	 	 	0.0454	 	 	 	0.0308	 	 	 	0.0205	 	 	 	0.0134	 	 	 	0.0081	 	 	 	0.0042	 	 	 	0.0002	 
	February 1, 2020	 	 	3.9824	 	 	 	3.3221	 	 	 	2.3247	 	 	 	1.7783	 	 	 	1.2038	 	 	 	0.5802	 	 	 	0.3060	 	 	 	0.0433	 	 	 	0.0290	 	 	 	0.0192	 	 	 	0.0123	 	 	 	0.0074	 	 	 	0.0039	 	 	 	0.0014	 	 	 	0.0000	 
	February 1, 2021	 	 	3.9824	 	 	 	3.2203	 	 	 	2.1433	 	 	 	1.5684	 	 	 	0.9875	 	 	 	0.4092	 	 	 	0.1897	 	 	 	0.0239	 	 	 	0.0159	 	 	 	0.0103	 	 	 	0.0062	 	 	 	0.0033	 	 	 	0.0012	 	 	 	0.0000	 	 	 	0.0000	 
	February 1, 2022	 	 	3.9824	 	 	 	3.0228	 	 	 	1.8165	 	 	 	1.2050	 	 	 	0.6385	 	 	 	0.1827	 	 	 	0.0642	 	 	 	0.0104	 	 	 	0.0071	 	 	 	0.0044	 	 	 	0.0024	 	 	 	0.0008	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 
	February 1, 2023	 	 	3.9824	 	 	 	2.9072	 	 	 	1.1215	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 	 	 	0.0000	 

 

The exact stock prices and effective dates
may not be set forth in the table above, in which case:

 

	 	●	If the stock price is between two stock prices in the table above or the effective date is between two effective dates in the table above, the number of additional shares by which the Conversion Rate will be increased will be determined by a straight-line interpolation between the number of additional shares set forth for the higher and lower stock prices and the earlier and later effective dates, as applicable, based on a 365-day year.
	 	 	 
	 	●	If the stock price is greater than $450.00 per share (subject to adjustment in the same manner as the stock prices set forth in the column headings of the table above as described in the Preliminary Offering Memorandum), no additional shares will be added to the Conversion Rate.
	 	 	 
	 	●	If the stock price is less than $65.10 per share (subject to adjustment in the same manner as the stock prices set forth in the column headings of the table above as described in the Preliminary Offering Memorandum), no additional shares will be added to the Conversion Rate.

 

Notwithstanding
the foregoing, in no event will the Conversion Rate per $1,000 principal amount of Notes exceed 15.3609 shares of the Issuer’s
common stock, subject to adjustment in the same manner as the Conversion Rate as set forth under “Description of Notes—Conversion
Rights—Conversion rate adjustments” in the Preliminary Offering Memorandum.

 

 

 

This
communication is intended for the sole use of the person to whom it is provided by the sender. This material is confidential and
is for your information only and is not intended to be used by anyone other than you. This information does not purport to be
a complete description of the Notes or the offering thereof. This communication does not constitute an offer to sell or the solicitation
of an offer to buy any Notes in any jurisdiction to any person to whom it is unlawful to make such offer or solicitation in such
jurisdiction.

 

The
Notes and any shares of the Issuer’s common stock issuable upon conversion of the Notes have not been and will not be registered
under the U.S. Securities Act of 1933, as amended (the “Securities Act”), or any other securities laws, and may not
be offered or sold within the United States or any other jurisdiction, except pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the Securities Act and any other applicable securities laws. The initial purchasers
are initially offering the Notes only to qualified institutional buyers as defined in, and in reliance on, Rule 144A under the
Securities Act. 

 

The
Notes and any shares of the Issuer’s common stock issuable upon conversion of the Notes are not transferable except in accordance
with the restrictions described under “Transfer Restrictions” in the Preliminary Offering Memorandum.

 

Any
legends, disclaimers or other notices that may appear below are not applicable to this communication and should be disregarded.
Such legends, disclaimers or other notices have been automatically generated as a result of this communication having been sent
via Bloomberg or another system.

  

[Remainder
of Page Intentionally Blank]

 

Sch B-4

     

    

    

 

SCHEDULE
C

 

Issuer
Written Information

 

Final
Term Sheet in the form set forth on Schedule B

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sch
C-1

     

    

    

 

SCHEDULE
D

 

List
of Persons and Entities Subject to Lock-up

 

Paul
E. Hassler 

Joseph
M. Cerulli

Todd
M. Cleveland

John
A. Forbes

Michael
A. Kitson

Andy
L. Nemeth

M.
Scott Welch

Walter
E. Wells

Jeffrey
M. Rodino

Kip
B. Ellis

Joshua
A. Boone

Courtney
A. Blosser

 

Sch
D-1

     

    

    

 

SCHEDULE
E

 

List
of Subsidiaries

  

	 	1.	Adorn Holdings. Inc. – Delaware Corporation

 

	 	2.	Structural Composites, LLC – Indiana LLC

 

	 	3.	Patrick Transportation, LLC – Indiana
    LLC

 

	 	4.	Larry Methvin Installation, Inc. – California
    Corporation

 

	 	5.	Shower Enclosures America, Inc. – California
    Corporation

 

	 	6.	All Counties Glass, Inc. – California
    Corporation

 

	 	7.	All State Glass, Inc. – California Corporation

 

	 	8.	KLS Doors, LLC – California LLC

 

	 	9.	Bathroom & Closet, LLC – Nevada LLC

 

	 	10.	Transport Indiana, LLC – Indiana LLC

 

	 	11.	Strong Dragon Investment Limited – Hong
    Kong Corporation

 

	 	12.	Dura Shower Enclosures Co., Ltd – Chinese
    LLC

 

	 	13.	Leisure Product Enterprises, LLC – Delaware
    LLC

 

	 	14.	MEP Acquisition Corp – Missouri C Corporation

 

	 	15.	JRL Ventures, LLC – Florida LLC

 

	 	16.	FMT Acquisition Co., LLC – Delaware LLC

 

	 	17.	Florida Marine Tanks, Inc. – Florida C
    Corporation

 

	 	18.	FMT Land Holdings LLC – Delaware LLC

 

Sch
E-1

     

    

    

 

Exhibit
A

 

FORM
OF LOCK-UP TO BE DELIVERED PURSUANT TO SECTION 5(g)

 

January
17, 2018

  

Merrill
Lynch, Pierce, Fenner & Smith

Incorporated

Wells
Fargo Securities, LLC

 

as
Representatives of the several Initial Purchasers

 

c/o
Merrill Lynch, Pierce, Fenner & Smith

Incorporated

One
Bryant Park

New
York, New York 10036

 

c/o
Wells Fargo Securities, LLC

375
Park Avenue, 3rd Floor

New
York, New York 10152

  

Re:  Proposed
Offering by Patrick Industries, Inc.

 

Dear
Sirs:

  

The
undersigned, a stockholder and an officer and/or director of Patrick Industries, Inc., an Indiana corporation (the “Company”),
understands that Merrill Lynch, Pierce, Fenner & Smith Incorporated (“Merrill Lynch”) and Wells Fargo Securities,
LLC (“Wells Fargo”) propose to enter into a Purchase Agreement (the “Purchase Agreement”) with the Company
providing for the offering (the “Offering”) of the Company’s 1.00% Convertible Senior Notes due 2023 (the “Securities”).
For good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the undersigned agrees with
each initial purchaser to be named in the Purchase Agreement that, during the period beginning on the date hereof and ending on
the date that is 45 days from the date of the Purchase Agreement, the undersigned will not, without the prior written consent
of Merrill Lynch, (i) directly or indirectly, offer, pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of any
shares of the Company’s common stock, no par value (the “Common Stock”) or any securities convertible into or
exercisable or exchangeable for Common Stock, whether now owned or hereafter acquired by the undersigned or with respect to which
the undersigned has or hereafter acquires the power of disposition (collectively, the “Lock-Up Securities”), or exercise
any right with respect to the registration of any of the Lock-up Securities, or file, cause to be filed or cause to be confidentially
submitted any registration statement in connection therewith, under the Securities Act of 1933, as amended (except that the undersigned
may take actions to register a Registration Statement on Form S-8 on behalf of the Company), or (ii) enter into any swap or any
other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership
of the Lock-Up Securities, whether any such swap or transaction is to be settled by delivery of Common Stock or other securities,
in cash or otherwise.

 

Exh.
A-1

     

    

    

 

Notwithstanding
the foregoing, and subject to the conditions below, the undersigned may sell or transfer the Lock-Up Securities without the prior
written consent of Merrill Lynch, provided that (1) Merrill Lynch receive a signed lock-up agreement for the balance of the lockup
period from each donee, trustee, distributee, or transferee, as the case may be, (2) except with respect to clause (i) below,
such transfers are not required to be reported with the Securities and Exchange Commission on Form 4 in accordance with Section
16 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and (3) except with respect to clause
(i) below, the undersigned does not otherwise voluntarily effect any public filing or report regarding such transfers:

  

	 	(i)	by will or intestate
    succession; or

 

	 	(ii)	as a bona fide gift
    or gifts; or

 

	 	(iii)	to any trust for
    the direct or indirect benefit of the undersigned or the immediate family of the undersigned (for purposes of this lock-up
    agreement, “immediate family” shall mean any relationship by blood, marriage or adoption, not more remote than
    first cousin); or

 

	 	(iv)	as a distribution
    to limited partners or stockholders of the undersigned; or

 

	 	(v)	to the undersigned’s
    affiliates or to any investment fund or other entity controlled or managed by the undersigned.

 

Furthermore,
notwithstanding the foregoing, (1) the undersigned may sell shares of Common Stock of the Company purchased by the undersigned
on the open market following the Offering if and only if (i) such sales are not required to be reported in any public report or
filing with the Securities and Exchange Commission, or otherwise and (ii) the undersigned does not otherwise voluntarily effect
any public filing or report regarding such sales; (2) the undersigned may transfer to the Company shares of Common Stock upon
the vesting, conversion, exercise or exchange of securities convertible into or exercisable or exchangeable for Common Stock granted
pursuant to the Company’s equity incentive plans (A) deemed to occur upon the cashless exercise of such securities provided
that the shares received upon exercise shall continue to be subject to the restrictions on transfer set forth in this lock-up
agreement and provided, further that any public report or filing required to be made under Section 16(a) of the
Exchange Act shall clearly indicate in the footnotes thereto that the filing relates to the “cashless” or “net”
exercise of a stock option, that no shares were sold by the reporting person and that the shares received upon exercise of the
stock option are subject to a lock-up agreement with the Initial Purchaser of the Offering, and provided further that no other
public announcement shall be required or shall be made voluntarily in connection with such transfer or (B) for the purpose of
paying the exercise price of such securities or for paying taxes (including estimated taxes) due as a result of the exercise of
such securities provided that any public report or filing required to be made under Section 16(a) of the Exchange Act shall clearly
indicate in the footnotes thereto that the purpose of such transfer is to cover such tax obligations or the payment of taxes due
in connection with the vesting event, and provided further that no other public announcement shall be required or shall be made
voluntarily in connection with such transfer; and (3) nothing herein shall prevent the undersigned from selling Lock-Up Securities
under a 10b5-l trading plan existing as of the date hereof that complies with Rule 10b5-l under the Exchange Act and has been
disclosed to Merrill Lynch and its counsel.

  

The
undersigned also agrees and consents to the entry of stop transfer instructions with the Company’s transfer agent and registrar
against the transfer of the Lock-Up Securities except in compliance with the foregoing restrictions.

  

The
undersigned understands, and you agree, that (i) if the Purchase Agreement does not become effective by March 30, 2018, (ii) if
the Company terminates the Offering or (iii) if the Purchase Agreement (other than the provisions thereof which survive termination)
shall terminate or be terminated prior to payment for and delivery of the Securities to be sold thereunder, the undersigned shall
be released from all obligations under this lock-up agreement.

 

	 	Very truly yours,
	 	 	 
	 	Signature:	 
	 	Print
    Name:	 

 

 

Exh.
A-2

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