Item 1.01. Entry into a Material Definitive Agreement
On November 12, 2019, Continental Building Products, Inc., a Delaware corporation (the “Company”), entered into an Agreement
and Plan of Merger (the “Merger Agreement”) with CertainTeed Gypsum and Ceilings USA, Inc., a Delaware corporation (“Parent”), Cupertino Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”),
and Compagnie de Saint-Gobain S.A., a société anonyme organized under the laws of France (the “Guarantor”).
The Merger Agreement provides, among other things and subject to the terms and conditions set forth therein, that Merger Sub will be
merged with and into the Company (the “Merger”), with the Company continuing as the surviving corporation and as a wholly owned subsidiary of Parent. The Merger Agreement provides that each share of common stock, par value $0.001 per share,
of the Company (“Common Stock”) outstanding immediately prior to the effective time of the Merger (the “Effective Time”) (other than shares of Common Stock held in treasury by the Company or owned by Parent, Merger Sub or any wholly
owned subsidiary of the Company and shares of Common Stock owned by stockholders of the Company who properly demand and do not withdraw a demand for, or lose their right to, appraisal rights pursuant to Section 262 of the General Corporation Law of
the State of Delaware) will at the Effective Time automatically be canceled and converted into the right to receive $37.00 in cash (the “Merger Consideration”).
Pursuant to the Merger Agreement, immediately prior to the Effective Time, (i) each option to purchase shares of Common Stock, whether
vested or unvested, that is outstanding immediately prior to the Effective Time will become fully vested and be converted into the right to receive an amount in cash equal to the product of (A) the excess of the Merger Consideration over the
exercise price of such option, multiplied by (B) the number of shares subject to such option, (ii) each time-based restricted stock unit award, whether vested or unvested, that is outstanding immediately prior to the Effective Time will become
fully vested and will be converted into the right to receive an amount in cash equal to the Merger Consideration in respect of each vested share of Common Stock subject to such award and (iii) each performance restricted stock unit award, whether
vested or unvested, that is outstanding immediately prior to the Effective Time will become fully vested, assuming achievement of the applicable performance goals under such award at the target level of attainment, and will be converted into the
right to receive an amount in cash equal to the Merger Consideration in respect of each vested share of Common Stock subject to such award.
The Company’s board of directors (the “Company Board”) has unanimously approved, authorized, adopted and declared advisable the
Merger Agreement, the Merger and the other transactions contemplated thereby. The obligation of the parties to complete the Merger is subject to customary closing conditions, including, among others, (i) the adoption and approval of the Merger
Agreement by the holders of at least a majority of the outstanding shares of Common Stock (the “Company Stockholder Approval”), (ii) the expiration or earlier termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, (iii) the absence of any law, order or injunction of a court or governmental entity of competent jurisdiction prohibiting the consummation of the Merger, (iv) the accuracy of the representations and warranties
contained in the Merger Agreement (subject to certain qualifications) and (v) the performance by the parties of their respective obligations under the Merger Agreement in all material respects.
The Company has made customary representations, warranties and covenants in the Merger Agreement, including, among others, covenants
(i) to conduct its business in all material respects in the ordinary course during the period between the execution of the Merger Agreement and the closing of the Merger and not take certain specified actions without the prior written approval of
Parent, (ii) to convene a meeting of its stockholders for the purpose of obtaining the Company Stockholder Approval, and (iii) subject to certain exceptions, not to solicit certain alternative acquisition proposals, engage in discussions or
negotiations with respect to such proposals or provide non-public information in connection with such proposals. Subject to certain exceptions, the Company Board is required to recommend that the Company’s stockholders adopt the Merger Agreement
and may not withdraw or modify in a manner adverse to Parent or Merger Sub such recommendation or take certain similar actions which are referred to in the Merger Agreement as an Adverse Recommendation Change. However, the Company may, prior to the
time the Company Stockholder Approval is obtained, make an Adverse Recommendation Change in connection with a Superior Proposal or Intervening Event (each as defined in the Merger Agreement) if the Company complies with certain notice and other
requirements and, in specified circumstances, pays the termination fee described below.
Parent has also made customary representations, warranties and covenants in the Merger Agreement, including, among others, covenants
requiring it to take certain actions as may be required to obtain antitrust approval, including selling, divesting or otherwise conveying particular assets or entering into agreements to do so under specified circumstances.
The Merger Agreement contains certain termination rights for the Company and Parent, including the right for either the Company or
Parent to terminate the Merger Agreement if the Merger has not been consummated prior to an outside date which is initially August 12, 2020 and subject to extension by either party up to February 12, 2021. Upon termination of the Merger Agreement
under specified circumstances, the Company will be required to pay Parent a termination fee of $40 million. The Merger Agreement further provides that Parent will be required to pay the Company a reverse termination fee of $75 million if the
Merger Agreement is terminated due to the failure of the parties to obtain required antitrust approvals prior to the outside date.
If the Merger is consummated, the Common Stock will be delisted from the New York Stock Exchange and deregistered under the Securities
Exchange Act of 1934.
The representations, warranties and covenants of the Company contained in the Merger Agreement have been made solely for the benefit
of Guarantor, Parent and Merger Sub. In addition, such representations, warranties and covenants (a) have been made only for purposes of the Merger Agreement, (b) have been qualified by (i) matters specifically disclosed in any reports filed by the
Company with the United States Securities and Exchange Commission (the “SEC”) prior to the date of the Merger Agreement (subject to certain exceptions) and (ii) confidential disclosures made to Parent and Merger Sub in a confidential
disclosure letter delivered in connection with the Merger Agreement, (c) are subject to materiality qualifications contained in the Merger Agreement which may differ from what may be viewed as material by investors, (d) were made only as of the
date of the Merger Agreement or such other date as is specified in the Merger Agreement and (e) have been included in the Merger Agreement for the purpose of allocating risk between the contracting parties rather than establishing matters as fact.
Accordingly, the Merger Agreement is included with this filing only to provide investors with information regarding the terms of the Merger Agreement, and not to provide investors with any other factual information regarding the Company or its
business. Investors should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of the Company or any of its subsidiaries or affiliates. Moreover,
information concerning the subject matter of the representations and warranties may change after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in the Company’s public disclosures. The Merger
Agreement should not be read alone, but should instead be read in conjunction with the other information regarding the Company that is or will be contained in, or incorporated by reference into, the Forms 10-K, Forms 10-Q and other documents that
the Company files with the SEC.
The foregoing description of the Merger Agreement and the transactions contemplated thereby does not purport to be complete and is
subject to, and qualified in its entirety by, the full text of the Merger Agreement attached hereto as Exhibit 2.1, which is incorporated into this Item 1.01 by reference.