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EXHIBIT 99.2
ASSIGNMENT AGREEMENT
THIS ASSIGNMENT AGREEMENT (this "Agreement") is made and entered into
as of July 25, 1999 (the "Effective Date"), by and between Xxxxxxx Partners II,
L.P., a Delaware limited partnership (the "Assignor"), and the persons specified
as assignees on SCHEDULE I hereto (each, an "Assignee" and collectively, the
"Assignees"), and Kevco, Inc., a Texas corporation (the "Company"). Capitalized
terms used without definition herein shall have the meanings specified in the
Securities Purchase Agreement dated as of July 14, 1999, by and between Assignor
and the Company (the "Purchase Agreement").
The following terms are a part of and form the bases for this
Agreement:
A. Contemporaneously herewith Assignor and the Company are executing
and delivering the Purchase Agreement, which provides, among other things, for
the sale by the Company to Assignor of the Shares, the Notes, and the Nonvoting
Warrants (collectively, the "Securities"), on the terms and subject to the
conditions set forth in the Purchase Agreement.
B. Section 13.8 of the Purchase Agreement provides that Assignor may
assign its right under the Purchase Agreement to purchase all or any portion of
the Securities and/or the right to receive the Nonvoting Warrant Shares or any
portion of the Nonvoting Warrant Shares to such Persons as previously disclosed
in writing to and approved by the Company prior to the date of the Purchase
Agreement.
C. As of the Effective Date, Assignor desires to assign, and each
Assignee desires to acquire, all of Assignor's right, title, and interest in and
to the Securities specified opposite such Assignee's name on SCHEDULE I hereto
(collectively, the "Assigned Interests").
D. As of the Effective Date, the Company desires to approve Assignor's
assignment to, and each Assignee's acquisition of, the Assigned Interests set
forth opposite such Assignee's name on SCHEDULE I hereto.
NOW, THEREFORE, for and in consideration of the mutual covenants and
agreements contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
1. Assignment. As of the Effective Date, Assignor hereby transfers and
assigns to each Assignee, and each Assignee hereby acquires from Assignor, all
of Assignor's right, title, and interest in and to the Assigned Interests set
forth opposite such Assignee's name on SCHEDULE I hereto. From and after the
Effective Date, each Assignee shall be the sole and exclusive owner of the
Assigned Interests set forth opposite each such Assignee's name on SCHEDULE I
hereto, and Assignor shall cease to have any right, title, or interest in and
to, such Assigned Interests.
2. Purchase Agreement. As of the Effective Date, each Assignee hereby
agrees to become a party to the Purchase Agreement and to be bound by all of the
obligations of the Assignor under the Purchase Agreement; provided, however,
that this Agreement shall not relieve Assignor of its obligations under the
Purchase Agreement.
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3. Representations and Warranties of Assignee. Each Assignee hereby
represents and warrants to Assignor and the Company as of the Effective Date as
follows:
(a) Assignee understands and acknowledges that the Securities
have not been registered under the Securities Act, or the securities
laws of any state or foreign jurisdiction and, unless so registered,
may not be offered, sold, transferred, or otherwise disposed of except
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and any applicable
securities laws of any state or foreign jurisdiction.
(b) Assignee is an "accredited investor" (as defined in Rule
501(a) of Regulation D under the Securities Act).
(c) Assignee (A) has knowledge and experience in financial and
business matters such that it is capable of evaluating the merits and
risks of purchasing the Securities, and (B) is able to bear the
economic risk of an investment in the Securities for an indefinite
period of time, including the risk of a complete loss of any such
investment.
(d) Assignee is acquiring the Securities for its own account
for investment purposes and not with a view to, or for offer or sale
for the Company in connection with, the distribution or resale thereof.
(e) Assignee understands and agrees that the Securities are
being sold in a transaction not involving any public offering within
the meaning of the Securities Act, and that the Securities may not be
offered, sold, or otherwise transferred to, or for the account or
benefit of, any Person except as permitted in the following sentence.
Assignee agrees, on its own behalf and on behalf of any accounts for
which Assignee is acting, that if Assignee should sell or otherwise
transfer any Securities, it will do so only (A) pursuant to an
exemption from the registration requirements of the Securities Act (if
available) or if the Securities Act does not apply or (B) pursuant to
an effective registration statement under the Securities Act, and
Assignee further agrees to provide to any Person purchasing any of the
Securities from it a notice advising such Assignee that resales of the
Securities are restricted as stated herein.
(f) The Assignee understands that the Securities purchased
pursuant to this Agreement will be in unregistered form only and that
any certificates delivered to it in respect of the Securities will bear
a legend substantially to the following effect:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE
BEEN PURCHASED PURSUANT TO A SECURITIES PURCHASE
AGREEMENT DATED AS OF JULY 14, 1999, BETWEEN THE
COMPANY AND XXXXXXX PARTNERS II, L.P. SUCH SECURITIES
HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR
ANY STATE SECURITIES LAW, AND SUCH SECURITIES MAY NOT
BE OFFERED, SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED,
OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT OR PURSUANT TO AN
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
AND APPLICABLE STATE SECURITIES LAWS.
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4. Consent to Assignment. The Company respectively approves of and
consents to, as of the Effective Date, Assignor's transfer to each Assignee of
the Assigned Interests set forth opposite such Assignee's name on SCHEDULE I
hereto.
5. Amendment. This Agreement may not be amended except by written
agreement signed by each party against whom such amendment is sought to be
enforced.
6. Binding Effect. This Agreement shall be binding upon and shall inure
to the benefit of the parties hereto and their respective heirs, successors,
permitted assigns, and legal representatives.
7. Counterparts. This Agreement is executed and delivered pursuant to
Section 13.8 of the Purchase Agreement and may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts together shall constitute but one and
the same instrument.
8. Entire Agreement. This Agreement sets forth the entire agreement and
understanding, and supercedes any prior agreements and understandings, written
or oral, of the parties hereto in respect of the subject matter hereof.
9. Further Assurances. The parties hereto shall execute and deliver
such further and additional instruments, agreements, and other documents, and
shall take such further and additional actions, as may be appropriate or
necessary to carry out the provisions of this Agreement.
10. Governing Law. This Agreement, including, without limitation, the
interpretation, construction, validity, and enforceability thereof, shall be
governed by the laws (other than the conflict of laws rules) of the State of
Texas.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
XXXXXXX PARTNERS II, L.P.
By: Xxxxxxx Management Company II, L.P.
its general partner
By: Xxxxxxx Management Limited, L.L.C.,
its general partner
By: /s/ XXXXXXXXX X. XXXX, XX.
-----------------------------------------
Xxxxxxxxx X. Xxxx, Xx.
Principal
XXXXXXX AFFILIATES II, L.P.
By: /s/ XXXXXXXXX X. XXXX, XX.
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Name: Xxxxxxxxx X. Xxxx, Xx.
Title: General Partner
ARMBUCK & CO.
By: /s/ XXXXXX X. XXXXXXX
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Name: Xxxxxx X. Xxxxxxx
Title: Partner
HC CROWN CORP.
By: /s/ XXXXXX XXX
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Name: Xxxxxx Xxx
Title: Vice President
LIMIT & CO.
By: /s/ XXXXXXX X. XXXXX
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Name: Xxxxxxx X. Xxxxx
Title: Partner
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XXXXXXX X. & XXXXXXXXX XXXXXX
REVOCABLE TRUST dated 7/3/92
By: /s/ XXXXXXX X. XXXXXX
-----------------------------------------
Name: Xxxxxxx X. Xxxxxx
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Title: Trustee
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XXXXXXX INVESTMENT COMPANY
By: /s/ XXXXX X. XXXXXXX, XX.
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Name: Xxxxx X. Xxxxxxx, Xx.
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Title: V.P.
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/s/ XXXXX X. XXXX
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Xxxxx X. Xxxx
KEVCO, INC.
By: /s/ XXXXX X. XXXXXX
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Name: Xxxxx X. Xxxxxx
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Title: President
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SCHEDULE I
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Principal Amount Principal Amount
Assignee's Name and Address Number of Shares of of Nonvoting Warrants
Tranche A Note Tranche B Note
-------------------------------------- ------------------ ------------------ ------------------- --------------------
Xxxxxxx Affiliates II, L.P. 25,542 160,820 61,490 (1)
000 Xxxxx Xx. Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxxxx X. Xxxx, Xx.
-------------------------------------- ------------------ ------------------ ------------------- --------------------
Armbuck & Co. 364,878 2,297,380 878,410 (2)
c/o The Hall Family Foundation
0000 XxXxx Xxxxxxx Xxx
Mail Drop 323
Xxxxxx Xxxx, Xxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxx X. XxxXxxxxx
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HC Crown Corp. 663,147 4,175,370 1,596,465 (3)
0000 XxXxx Xxxxxxx Xxx
Mail Drop 387
Xxxxxx Xxxx, Xxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxx XxXxxxxx
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Limit & Co. 298,269 1,877,990 718,055 (4)
0000 XxXxx Xxxxxxx Xxx
Mail Drop 323
Xxxxxx Xxxx, Xxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxx X. XxxXxxxxx
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Xxxxxxx X. & Xxxxxxxxx Xxxxxx 7,290 45,900 17,550 (5)
Revocable Trust dated 7/3/92
c/o InterWest Partners
0000 Xxxx Xxxx Xxxx
Xxxxxxxx 0, Xxxxx 000
Xxxxx Xxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx
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Xxxxxxx Investment Company 10,935 68,850 26,325 (6)
000 Xxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxx X. Xxxxxxx, Xx.
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Xxxxx X. Xxxx 3,645 22,950 8,775 (7)
c/o Wingate Partners II, L.P.
000 Xxxxx Xx. Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Facsimile: (000) 000-0000
-------------------------------------- ------------------ ------------------ ------------------- --------------------
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(1) Consists of (i) the right to acquire 6,386 Nonvoting Warrant Shares to
be acquired on exercise of the Nonvoting Warrant for 675,000 Nonvoting
Warrant Shares, (ii) the right to acquire 7,310 Nonvoting Warrant
Shares to be acquired on exercise of the Nonvoting Warrant for 772,727
Nonvoting Warrant Shares, and (iii) the right to acquire 2,795
Nonvoting Warrant Shares to be acquired on exercise of the Nonvoting
Warrant for 295,455 Nonvoting Warrant Shares.
(2) Consists of (i) the right to acquire 91,220 Nonvoting Warrant Shares to
be acquired on exercise of the Nonvoting Warrant for 675,000 Nonvoting
Warrant Shares, (ii) the right to acquire 104,426 Nonvoting Warrant
Shares to be acquired on exercise of the Nonvoting Warrant for 772,727
Nonvoting Warrant Shares, and (iii) the right to acquire 39,928
Nonvoting Warrant Shares to be acquired on exercise of the Nonvoting
Warrant for 295,455 Nonvoting Warrant Shares.
(3) Consists of (i) the right to acquire 165,787 Nonvoting Warrant Shares
to be acquired on exercise of the Nonvoting Warrant for 675,000
Nonvoting Warrant Shares, (ii) the right to acquire 189,789 Nonvoting
Warrant Shares to be acquired on exercise of the Nonvoting Warrant for
772,727 Nonvoting Warrant Shares, and (iii) the right to acquire 72,567
Nonvoting Warrant Shares to be acquired on exercise of the Nonvoting
Warrant for 295,455 Nonvoting Warrant Shares.
(4) Consists of (i) the right to acquire 74,567 Nonvoting Warrant Shares to
be acquired on exercise of the Nonvoting Warrant for 675,000 Nonvoting
Warrant Shares, (ii) the right to acquire 85,363 Nonvoting Warrant
Shares to be acquired on exercise of the Nonvoting Warrant for 772,727
Nonvoting Warrant Shares, and (iii) the right to acquire 32,639
Nonvoting Warrant Shares to be acquired on exercise of the Nonvoting
Warrant for 295,455 Nonvoting Warrant Shares.
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(5) Consists of (i) the right to acquire 1,823 Nonvoting Warrant Shares to
be acquired on exercise of the Nonvoting Warrant for 675,000 Nonvoting
Warrant Shares, (ii) the right to acquire 2,086 Nonvoting Warrant
Shares to be acquired on exercise of the Nonvoting Warrant for 772,727
Nonvoting Warrant Shares, and (iii) the right to acquire 798 Nonvoting
Warrant Shares to be acquired on exercise of the Nonvoting Warrant for
295,455 Nonvoting Warrant Shares.
(6) Consists of (i) the right to acquire 2,734 Nonvoting Warrant Shares to
be acquired on exercise of the Nonvoting Warrant for 675,000 Nonvoting
Warrant Shares, (ii) the right to acquire 3,130 Nonvoting Warrant
Shares to be acquired on exercise of the Nonvoting Warrant for 772,727
Nonvoting Warrant Shares, and (iii) the right to acquire 1,197
Nonvoting Warrant Shares to be acquired on exercise of the Nonvoting
Warrant for 295,455 Nonvoting Warrant Shares.
(7) Consists of (i) the right to acquire 911 Nonvoting Warrant Shares to be
acquired on exercise of the Nonvoting Warrant for 675,000 Nonvoting
Warrant Shares, (ii) the right to acquire 1,043 Nonvoting Warrant
Shares to be acquired on exercise of the Nonvoting Warrant for 772,727
Nonvoting Warrant Shares, and (iii) the right to acquire 399 Nonvoting
Warrant Shares to be acquired on exercise of the Nonvoting Warrant for
295,455 Nonvoting Warrant Shares.
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