EXECUTION VERSION

 

STOCK REPURCHASE AGREEMENT

 

THIS STOCK REPURCHASE AGREEMENT (this “Agreement”) is entered into as of January
6, 2014 by and among NCI Building Systems, Inc., a Delaware corporation (the
“Company”), and the stockholders of the Company listed on Schedule A to this
Agreement (collectively, the “Investors”).

 

Background

 

A. The Investors own an aggregate of 54,136,817 shares of the Company’s common
stock, $0.01 par value per share ( “Common Stock”), and have agreed to transfer
a portion of those shares to the Company on the terms and conditions set forth
in this Agreement;

 

B. The Investors and the Company are commencing, on the date hereof, an
underwritten public offering (the “Public Offering”) of certain shares of Common
Stock held by the Investors (the “Underwritten Shares”); and

 

C. The Company has proposed to repurchase an aggregate of 1,150,000 shares of
Common Stock (the “Repurchase Shares”) at the price per share to the public in
the Public Offering (the “Purchase Price”) upon the terms and conditions
provided in this Agreement (the “Repurchase”).

 

D. The Investors and the Company desire to condition the Repurchase on the
closing of the Public Offering.

 

THEREFORE, in consideration of the mutual covenants herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the undersigned hereby agree as follows:

 

Agreement

 

1. Repurchase.

 

(a) Each Investor hereby agrees, severally and not jointly, to transfer, assign,
sell, and convey 100% of its right, title, and interest in and to the number of
Repurchase Shares set forth opposite such Investor’s name on Schedule A, subject
to adjustment as provided in paragraph 4.

 

(b) The obligations of the Company to purchase the Repurchase Shares shall be
subject to the closing of the Public Offering pursuant to an underwriting
agreement by and among the Company, the Investors and the underwriters named
therein (the “Underwriting Agreement”).

 

(c) The closing of the sale of the Repurchase Shares (the “Closing”), as
applicable, shall take place upon the same day as the closing of the sale of the
Underwritten Shares at the offices of Debevoise & Plimpton LLP, 919 Third
Avenue, New York, NY 10022, or at such other time and place as may be agreed
upon by the Company and Investors holding a majority of the aggregate number of
Repurchase Shares. At the Closing, each Investor shall deliver to the Company or
as instructed by the Company duly executed stock powers relating to those
Repurchase Shares being sold by such Investor, and the Company agrees to deliver
to each Investor by wire transfer in accordance with written instructions to be
provided by the Investors prior to the Closing of immediately available funds
the Purchase Price multiplied by the number of Repurchase Shares being sold by
such Investor.

 

 

 

 

(d) The Investors each agree to pay all stamp, stock transfer and similar
duties, if any, in connection with the Repurchase.

 

(e) The Company shall be entitled to deduct and withhold from payments of the
Purchase Price any amount required to be so deducted or withheld pursuant to the
Internal Revenue Code of 1986, as amended, and the applicable Treasury
regulations thereunder.

 

2. Company Representations. In connection with the transactions contemplated
hereby, the Company represents and warrants to the Investors that:

 

(a) The Company is a corporation duly organized and existing under the laws of
the State of Delaware.

 

(b) The Company has the requisite corporate power and authority to execute,
deliver and perform its obligations under this Agreement and to consummate the
transactions contemplated hereby; and this Agreement has been duly authorized,
executed and delivered by the Company;

 

(c) This Agreement constitutes a valid and binding agreement of the Company
enforceable in accordance with its terms, except to the extent that enforcement
thereof may be limited by bankruptcy, insolvency, reorganization or other laws
affecting enforcement of creditors’ rights or by general equitable principles.

 

(d) The compliance by the Company with this Agreement and the consummation of
the transactions herein contemplated will not (i) conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of the subsidiaries of the
Company listed on Schedule B (such subsidiaries, the “Designated Subsidiaries”)
is a party or by which the Company or any of the Designated Subsidiaries is
bound or to which any of the property or assets of the Company or any of the
Designated Subsidiaries is subject, (ii) violate any provision of the
certificate of incorporation or by-laws, as applicable, of the Company or the
Designated Subsidiaries or (iii) violate any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Company or any of the Designated Subsidiaries or any of their properties;
except, in the case of clauses (i) and (iii), as would not reasonably be
expected to have a material adverse effect on the financial position,
stockholders’ equity or results of operations of the Company and its
subsidiaries, taken as a whole (a “Material Adverse Effect”), in the case of
each such clause, after giving effect to any consents, approvals,
authorizations, orders, registrations, qualifications, waivers and amendments as
will have been obtained or made as of the date of this Agreement; and no
consent, approval, authorization, order, registration or qualification of or
with any such court or governmental agency or body is required for the
execution, delivery and performance by the Company of its obligations under this
Agreement, including the consummation by the Company of the transactions
contemplated by this Agreement, except where the failure to obtain or make any
such consent, approval, authorization, order, registration or qualification
would not reasonably be expected to have a Material Adverse Effect;

 

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3. Representations of the Investors. In connection with the transactions
contemplated hereby, each Investor severally and not jointly represents and
warrants to the Company that:

 

(a) All consents, approvals, authorizations, orders or filings necessary for the
execution and delivery by such Investor of this Agreement and for the sale and
delivery of the Repurchase Shares to be sold by such Investor hereunder, have
been obtained, or will be obtained prior to the delivery of the Repurchase
Shares; and such Investor has full right, power and authority to enter into this
Agreement and to sell, assign, transfer and deliver the Repurchase Shares to be
sold by such Investor hereunder, except for such consents, approvals,
authorizations and orders as would not impair in any material respect the
consummation of the Investors’ obligations hereunder;

 

(b) This Agreement constitutes a valid and binding agreement of such Investor,
enforceable in accordance with its terms, except to the extent that enforcement
thereof may be limited by bankruptcy, insolvency, reorganization or other laws
affecting enforcement of creditors’ rights or by general equitable principles.

 

(c) The sale of the Repurchase Shares to be sold by such Investor hereunder and
the compliance by such Investor with all of the provisions of this Agreement and
the consummation of the transactions contemplated herein (i) will not conflict
with or result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any statute, indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which such Investor is a
party or by which such Investor is bound or to which any of the property or
assets of such Investor is subject, (ii) nor will such action result in any
violation of the provisions of (a) any organizational or similar documents
pursuant to which such Investor was formed or (b) any statute or any order, rule
or regulation of any court or governmental agency or body having jurisdiction
over such Investor or the property of such Investor; except in the case of
clause (i) or clause (ii)(b), for such conflicts, breaches, violations or
defaults as would not impair in any material respect the consummation of such
Investor’s obligations hereunder.

 

(d) As of the date hereof and immediately prior to the delivery of the
Repurchase Shares to the Company at the Closing, such Investor will be the
beneficial or record holder of the Repurchase Shares with full dispositive power
thereover, and holds, and will hold, such Repurchase Shares free and clear of
all liens, encumbrances, equities or claims; and, upon delivery of such
Repurchase Shares and payment therefor pursuant hereto, assuming that the
Company has no notice of any adverse claims within the meaning of Section 8-105
of the New York Uniform Commercial Code as in effect in the State of New York
from time to time (the “UCC”), the Company will acquire a valid security
entitlement (within the meaning of Section 8-102(a)(17) of the UCC) to such
Repurchase Shares purchased by the Company, and no action (whether framed in
conversion, replevin, constructive trust, equitable lien or other theory) based
on an adverse claim (within the meaning of Section 8-105 of the UCC) to such
security entitlement may be asserted against the Company.

 

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(e) The Investors have received all of the information that they consider
necessary or appropriate for deciding whether to sell the Repurchase Shares and
have had the opportunity to ask questions and receive answers from the Company.

 

(f) The Investors have had the opportunity to discuss with their tax advisors
the consequences of the Repurchase.

 

4. Termination.

 

(a) This Agreement may be terminated with respect to any Investor at any time by
the mutual written, consent of the Company and such Investor. Furthermore, this
Agreement shall automatically terminate and be of no further force and effect,
in the event that, the conditions in paragraph 1(b) of this Agreement have not
been satisfied within 15 business days after the date hereof.

 

(b) In the event that this Agreement is terminated as to any Investor or any
Investor defaults on the obligations of such Investor under paragraph 1 (a
“Defaulting Investor”), the number of Repurchase Shares being sold to the
Company by each remaining Investor shall remain equal to the number of
Repurchase Shares set forth opposite the name of such remaining Investor on
Schedule A.

 

5. Notices. All notices, demands or other communications to be given or
delivered under or by reason of the provisions of this Agreement will be in
writing and will be deemed to have been given when delivered personally, mailed
by certified or registered mail, return receipt requested and postage prepaid,
or sent via a nationally recognized overnight courier, or sent via email
(receipt of which is confirmed) to the recipient. Such notices, demands and
other communications will be sent, in the case of the Investors, to the
addresses set forth on the signature pages to this Agreement and, in the case of
the Company, to the address indicated below:

 

To the Company:

 

NCI Building Systems, Inc.

10943 North Sam Houston Parkway West

Houston, Texas 77064

Attention: Todd R. Moore

Email Address: trmoore@ncigroup.com

 

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

Debevoise & Plimpton LLP
919 Third Avenue
New York, NY 10022
Attention: Steven J. Slutzky
Email Address: sjslutzky@debevoise.com

 

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or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party.

 

6. Miscellaneous.

 

(a) Survival of Representations and Warranties. All representations and
warranties contained herein or made in writing by any party in connection
herewith shall survive the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby.

 

(b) Severability. Whenever possible, each provision of this Agreement will be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be invalid, illegal, or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality, or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed, and enforced in such jurisdiction as if such invalid,
illegal, or unenforceable provision had never been contained herein.

 

(c) Complete Agreement. This Agreement and any other agreements ancillary
thereto and executed and delivered on the date hereof embody the complete
agreement and understanding between the parties and supersede and preempt any
prior understandings, agreements, or representations by or among the parties,
written or oral, which may have related to the subject matter hereof in any way.

 

(d) Counterparts. This Agreement may be executed in separate counterparts, each
of which is deemed to be an original and all of which taken together constitute
one and the same agreement.

 

(e) Successors and Assigns. Except as otherwise provided herein, this Agreement
shall bind and inure to the benefit of and be enforceable by the Investors and
the Company and their respective successors and assigns.

 

(f) Governing Law. The Agreement will be governed by and construed in accordance
with the laws of the State of New York.

 

(g) Remedies. The parties hereto agree and acknowledge that money damages may
not be an adequate remedy for any breach of the provisions of this Agreement and
that any party may in its sole discretion apply to any court of law or equity of
competent jurisdiction (without posting any bond or deposit) for specific
performance or other injunctive relief in order to enforce, or prevent any
violations of, the provisions of this Agreement.

 

(h) Amendment and Waiver. The provisions of this Agreement may be amended and
waived only with the prior written consent of the Company and each Investor.

 

(i) Further Assurances. Each of the Company and the Investors shall execute and
deliver such additional documents and instruments and shall take such further
action as may be necessary or appropriate to effectuate fully the provisions of
this Agreement.

 

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(j) Expenses. Each of the Company and the Investors shall bear their own
expenses in connection with the drafting, negotiation, execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby.

 

(k) Interpretation. The definitions in this Agreement are applicable to the
singular as well as the plural forms of such terms.

 

 

 

[Signatures appear on following pages.]

 

 

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IN WITNESS WHEREOF, the parties hereto have executed this Stock Repurchase
Agreement as of the date first written above.

 

  Company:       NCI BUILDING SYSTEMS, INC.           By: /s/ Mark. E. Johnson  
Name: Mark E. Johnson   Title: Executive Vice President, Chief Financial Officer
& Treasurer

 

 

 

 

  Investors:           CLAYTON, DUBILIER & RICE   FUND VIII, L.P.       By: CD&R
Associates VIII, Ltd., its general partner         By: /s/ Theresa A. Gore  
Name: Theresa A. Gore   Title: Vice President, Treasurer & Assistant Secretary  
            CD&R FRIENDS & FAMILY   FUND VIII, L.P.       By: CD&R Associates
VIII, Ltd., its general partner         By: /s/ Theresa A. Gore   Name: Theresa
A. Gore   Title: Vice President, Treasurer & Assistant Secretary

 

    Address for Notices:           Clayton, Dubilier & Rice Fund VIII, L.P.    
c/o Clayton, Dubilier & Rice, LLC     375 Park Avenue     New York, New York
10152     Attention:  Theresa A. Gore           with a copy (which shall not
constitute notice) to:           Debevoise & Plimpton LLP     919 Third Avenue  
  New York, New York 10022     Attention:  Andrew L. Bab, Esq.

 

 

[Signature Page to Stock Repurchase Agreement] 

 

 

 

SCHEDULE A

 

Investor

 

Repurchase Shares

Clayton, Dubilier & Rice Fund VIII, L.P.

 

1,147,128

CD&R Friends & Family Fund VIII, L.P.

 

2,872 Total 1,150,000

 

 

 

 

SCHEDULE B

 

NCI Group, Inc.

 

Robertson-Ceco II Corporation