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Designated Filer: |
Warburg Pincus Private Equity IX, L.P. |
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Issuer & Ticker Symbol: |
Builders FirstSource, Inc. (BLDR) |
Date of Event Requiring Statement: January 21, 2010
Exhibit 99.1
Explanation of Responses:
(1) This Form 4 is filed on behalf of Warburg Pincus Private Equity IX, L.P., a Delaware limited partnership (“WP IX”), Warburg Pincus IX, LLC, a New York limited liability company (“WP IX LLC”), Warburg Pincus Partners, LLC, a New York limited liability company (“WPP LLC”), Warburg Pincus LLC, a New York limited liability company (“WP LLC”), Warburg Pincus & Co., a New York general partnership (“WP”), and Messrs. Charles R. Kaye and Joseph P. Landy (collectively, the “Warburg Pincus Reporting Persons”). The sole general partner of WP IX is WP IX LLC. WPP LLC is the sole member of WP IX LLC. WP is the managing member of WPP LLC. WP LLC manages WP IX. Charles R. Kaye and Joseph P. Landy are each Managing General Partners of WP and Co-Presidents and Managing Members of WP LLC. By reason of the provisions of Rule 16a-1 of the Securities Exchange Act of 1934, as amended, WP, WP LLC, WPP LLC, WP IX LLC, Mr. Kaye and Mr. Landy may be deemed to be the beneficial owners of any securities that may be deemed to be beneficially owned by WP IX. Each of WP, WP LLC, WPP LLC, WP IX LLC, Mr. Kaye and Mr. Landy all disclaim beneficial ownership of all shares of Common Stock except to the extent of any indirect pecuniary interest therein.
(2) These shares of Common Stock, par value $0.01 per share, of Builders FirstSource, Inc. (the “Company”) were purchased by Building Products, LLC (“Building Products”), pursuant to the provisions of that certain Investment Agreement, dated as of October 23, 2009, by and among JLL Partners Fund V, L.P., WP IX and the Company (as amended, the “Investment Agreement”), upon exercise of subscription rights issued pro rata to holders of the Company’s Common Stock as of the close of business on December 14, 2009, to purchase shares of the Company’s Common Stock at a subscription price of $3.50 per share (the “Rights Offering”) under the basic subscription privilege of the Rights Offering.
(3) The Warburg Pincus Reporting Persons disclaim beneficial ownership of these securities except to the extent of any pecuniary interest therein, and this report shall not be deemed an admission that any of the Warburg Pincus Reporting Persons is the beneficial owner of the securities for purposes of Section 16 or for any other purpose.
(4) WP IX indirectly beneficially owns 21,509,694.5 shares of Common Stock of the Company by virtue of its position as a member of Building Products and pursuant to the Amended and Restated Limited Liability Company Agreement of Building Products, adopted on February 27, 2006, as amended.
(5) These shares of Common Stock of the Company were acquired pursuant to the Investment Agreement, which obligated WP IX to exchange $48.909 million in aggregate principal amount of the Second Priority Senior Secured Floating Notes due 2012 of the Company that it held through JWP LLC (“JWP”). On January 21, 2010, the Company and Wilmington Trust FSB, as exchange agent in the Company’s debt exchange, determined the allocation of shares of the Company’s Common Stock in accordance with the proration required in the debt exchange, and WP IX was notified that it would receive indirect ownership through JWP of 2,534,889.5 shares of the Company’s Common Stock in the debt exchange at an exchange price per share of $3.50, as well as $40,036,886.16 in cash.
(6) WP IX indirectly beneficially owns 2,534,889.5 shares of Common Stock of the Company by virtue of its position as a member of JWP and pursuant to the Amended and Restated Limited Liability Company Agreement of JWP, dated as of August 31, 2009. When aggregated with the 21,509,694.5 shares of Common Stock indirectly beneficially owned by WP IX through Building Products and the 402,841 shares of Common Stock directly beneficially owned by WP IX, WP IX may be deemed to have beneficial ownership of 24,447,425 shares of Common Stock of the Company.
(7) These subscription rights were exercised by Building Products, at the direction of WP IX, under its basic subscription privilege in the Rights Offering, as described above in Note 2.