HW Headwaters Incorporated (delisted)

PROXY STATEMENT

Special Meeting of Stockholders
To Be Held on February 3, 2017

GENERAL INFORMATION

        This proxy statement is being furnished to the stockholders of Headwaters Incorporated, in connection with the solicitation of proxies on behalf of the Board of Directors of Headwaters for use at Headwaters' Special Meeting of Stockholders and any and all adjournments or continuations of the special meeting, to be held on Friday, February 3, 2017, starting at 2:00 p.m., Mountain Standard Time, at our corporate headquarters located at 10701 South River Front Parkway, Suite 300, South Jordan, Utah 84095, for the purposes set forth in the accompanying Notice of Special Meeting of Stockholders. On or about January 3, 2017, we will mail to our stockholders this proxy statement and other proxy materials.

        When we use "Headwaters," "we," "us," "our" or the "Company," we are referring to Headwaters Incorporated.

         The Notice and this Proxy Statement are also available at https://materials.proxyvote.com/42210P.

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SUMMARY TERM SHEET

        This summary term sheet briefly summarizes material information found in this proxy statement concerning the merger. The proxy statement contains a more detailed description of the terms described in this summary. You are urged to read this proxy statement carefully, including the annexes and the documents referred to or incorporated by reference in this proxy statement, as this summary may not contain all of the information that may be important to you. We have included page references in parentheses to direct you to the appropriate place in this proxy statement for a more complete description of the topics presented in this summary term sheet. You may obtain the information incorporated by reference in this proxy statement without charge by following the instructions under "Where Stockholders Can Find More Information" beginning on page 109 of this proxy statement.

        In this proxy statement, the terms "we," "us," "our," "Headwaters" and the "company" refer to Headwaters Incorporated and, where appropriate, its subsidiaries. We refer to the Headwaters Board of Directors as the "Board of Directors" or the "Board," Boral Limited as "Boral" and Enterprise Merger Sub, Inc. as "Merger Sub" in this proxy statement. All references to the "merger" refer to the merger of Merger Sub with and into Headwaters, with Headwaters surviving as an indirect wholly owned subsidiary of Boral; and, unless otherwise indicated or as the context requires, all references to the "merger agreement" refer to the Agreement and Plan of Merger, dated as of November 20, 2016, as it may be amended from time to time, by and among Headwaters, Boral and Merger Sub, a copy of which is included as Annex A to this proxy statement. Headwaters, following the completion of the merger, is sometimes referred to in this proxy statement as the "surviving company."

Parties Involved in the Merger (Page 28)

Headwaters Incorporated

        Headwaters Incorporated, a Delaware corporation, is a building materials company operating in the building products and construction materials sectors. Our vision is to improve lives through innovative advancements in building products and materials. Headwaters sells building products such as manufactured architectural stone, siding accessory products, roof products, concrete blocks, and windows. Headwaters also sells construction materials such as coal combustion products ("CCPs"), including bottom ash, synthetic gypsum and fly ash, which is primarily used as a partial replacement for Portland cement in concrete.

        Headwaters' common stock is listed on the New York Stock Exchange, which we refer to as the "NYSE" in this proxy statement, under the symbol "HW."

        Headwaters' principal executive offices are located at 10701 South River Front Parkway, Suite 300, South Jordan, Utah 84095, United States, its telephone number is 801.984.9400 and its internet website address is www.headwaters.com. The information provided on or accessible through Headwaters' website, other than securities filings that are otherwise incorporated herein by reference, is not part of this proxy statement and is not incorporated in this proxy statement by this or any other reference to our website provided in this proxy statement.

        Additional information about Headwaters is contained in its public filings, certain of which we incorporate by reference herein. See "Where Stockholders Can Find More Information" beginning on page 109 of this proxy statement.

Boral Limited

        Boral Limited engages in the provision of building and construction materials. It operates through three divisions: Boral Australia, USG Boral and Boral USA. Boral Australia is the largest integrated supplier of construction materials in Australia, supplying quarry products, concrete, asphalt, cement, and concrete placing, as well as timber, roof tiles and masonry building products. The USG Boral

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Gypsum Joint Venture is a 50/50 joint venture between USG Corp. and Boral Limited, and is a leading manufacturer and distributor of gypsum wallboard products across Australia, Asia and the Middle East. Boral USA manufactures and distributes clay bricks, manufactured stone, roof tiles, fly ash and composite trim and siding across the U.S., and operates a concrete and quarries business in Colorado. Boral employs around 12,000 employees globally, including in its joint venture operations. Boral is headquartered in Sydney, Australia and is listed on the Australian Securities Exchange, which we refer to as the "ASX" in this proxy statement, under the code "BLD."

        Boral's principal executive offices are located at Level 3, 40 Mount Street, North Sydney NSW 2060, Australia its telephone number is +61.2.9220.6300 and its internet website address is www.boral.com.au. The information provided on or accessible through Boral's website is not part of this proxy statement and is not incorporated in this proxy statement by this or any other reference to Boral's website provided in this proxy statement.

Enterprise Merger Sub, Inc.

        Enterprise Merger Sub, Inc., an indirect wholly owned subsidiary of Boral, is a Delaware corporation that was incorporated on November 18, 2016 for the sole purpose of entering into the merger agreement and completing the transactions contemplated by the merger agreement, including the merger. On the terms and subject to the conditions of the merger agreement, at the effective time of the merger, Merger Sub will be merged with and into Headwaters, with Headwaters surviving the merger as an indirect wholly owned subsidiary of Boral.

        Merger Sub's principal executive offices are located at 200 Mansell Court East #305, Roswell, Georgia 30076, and its telephone number is +770.645.4500.

The Merger (Page 72)

        On the terms and subject to the conditions set forth in the merger agreement, and in accordance with the General Corporation Law of the State of Delaware, which we refer to as the DGCL, at the effective time of the merger, Merger Sub will merge with and into Headwaters. At the effective time of the merger, the separate corporate existence of Merger Sub will cease and Headwaters will continue as the surviving company in the merger, which we sometimes refer to herein as the surviving company.

Expected Timing of the Merger (Page 72)

        Headwaters and Boral are working to complete the merger promptly, and we intend it to be completed in mid-calendar year 2017. The merger is subject, however, to various regulatory approvals and other conditions to closing, which are described in more detail in this proxy statement, and it is possible that factors outside the control of either company could result in the merger being completed at a later time, or not at all.

        We expect to complete the merger promptly following the receipt of all required regulatory approvals and the satisfaction or waiver of the other conditions precedent described in the merger agreement.

Effect on Headwaters if the Merger is Not Completed (Page 24)

        If the merger agreement is not adopted by Headwaters stockholders at the special meeting or if the merger is not completed for any other reason, Headwaters stockholders will not receive the merger consideration or any payment for their shares of Headwaters common stock in connection with the merger. Instead, Headwaters will remain a public company and Headwaters common stock will continue to be listed and traded on the NYSE and registered under the Securities Exchange Act of 1934, as amended, which we refer to as the Exchange Act, and Headwaters will continue to file

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periodic reports with the U.S. Securities and Exchange Commission, which we refer to as the "SEC" in this proxy statement. In certain circumstances, Headwaters may be required to pay, or may be entitled to receive, a termination fee, may be required to reimburse Boral's expenses (subject to certain limitations), or may seek other remedies in connection with a termination of the merger agreement, in each case, as described under "Terms of the Merger Agreement—Termination of the Merger Agreement—Termination Fees" and "Terms of the Merger Agreement—Termination of the Merger Agreement—Effect of Termination" beginning on page 95 of this proxy statement.

Merger Consideration (Page 73)

        At the effective time of the merger, each share of our common stock issued and outstanding immediately prior to such time (other than (i) shares owned by Headwaters as treasury stock and shares owned directly by Boral or Merger Sub immediately prior to the effective time of the merger, (ii) shares owned by any direct or indirect wholly owned subsidiary of Headwaters or Boral, (iii) Headwaters restricted shares to be converted to cash and (iv) shares owned by stockholders who have properly exercised their stockholder's appraisal rights in respect of such shares under Section 262 of the DGCL, which we collectively refer to as excluded shares) will be converted into the right to receive (x) $24.25 in cash, without interest, and (y) the additional consideration, if any (as described below), which we refer to herein together as the merger consideration. All such shares of Headwaters common stock, when so converted, will no longer be outstanding and will automatically be canceled and will cease to exist. The right of any holder of Headwaters common stock to receive the merger consideration will be subject to and reduced by the amount of any required withholding under applicable tax law.

        The additional consideration means, if the closing has not occurred by September 1, 2017, which we refer to as the regulatory approval trigger date, and the only conditions to the obligations of Boral and Merger Sub to close that have not been satisfied (other than those conditions that by their terms are to be satisfied at the closing, which conditions would be capable of being satisfied at the closing) are the conditions with respect to regulatory approvals and the absence of legal restraints (but only if the applicable legal restraint is issued under or pursuant to any antitrust law or results from a failure to obtain clearance by the Committee on Foreign Investment in the United States, which we refer to as CFIUS, clearance) and Headwaters' breach (if any) of the merger agreement was not the primary cause of, or primarily resulted in, the failure of such conditions to be satisfied, an amount (rounded down to the nearest whole penny) in cash equal to the product of (i) each calendar month that elapses during the period commencing on the regulatory approval trigger date and ending on the date immediately preceding the closing date and (ii) $0.09, pro rated (based on the number of days elapsed) for the month in which the closing occurs to the extent the closing date is not the last day of the month.

        At or prior to the effective time of the merger, Boral will deposit or cause to be deposited with the paying agent cash sufficient to pay the aggregate merger consideration, which we refer to as the payment fund.

Voting Agreement (Page 60 and Annex B)

        Concurrently with the execution of the merger agreement, Kirk A. Benson, our Chairman and Chief Executive Officer, entered into a voting agreement, which we refer to as the voting agreement, with Boral, pursuant to which Mr. Benson, among other things, is required to vote in favor of the adoption of the merger agreement. As of December 23, 2016, Mr. Benson is entitled to vote approximately 1,575,665 shares of our common stock, or approximately 2.1% of the shares of our common stock outstanding and entitled to vote.

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The Special Meeting (Page 30)

Date, Time and Place (Page 30)

        The special meeting will be held on Friday, February 3, 2017, at 2 p.m., Mountain Standard Time, at 10701 South River Front Parkway, Suite 300, South Jordan, Utah 84095.

Purpose of the Special Meeting (Page 30)

        At the special meeting, you will be asked to consider and vote upon:

(1)

a proposal to adopt the merger agreement, approving the transactions contemplated thereby, including the merger, which proposal we refer to as the "merger proposal" in this proxy statement;



(2)

a proposal to approve, by a non-binding advisory vote, the compensation arrangements disclosed in this proxy statement that may be payable to Headwaters' named executive officers in connection with the completion of the merger, which proposal we refer to as the "merger-related named executive officer compensation proposal" in this proxy statement; and



(3)

a proposal to approve the adjournment of the special meeting from time to time if necessary or appropriate in the view of the Board of Directors, to solicit additional proxies if there are not sufficient votes at the time of the special meeting to adopt the merger agreement, which proposal we refer to as the "adjournment proposal" in this proxy statement.

Recommendations of Our Board of Directors (Page 30)

        After considering various reasons to approve the merger agreement, as well as certain countervailing factors, the Board of Directors unanimously determined the merger agreement, the merger and the other transactions contemplated by the merger agreement, to be advisable, fair to and in the best interests of Headwaters and its stockholders, and unanimously approved the merger agreement, the merger and the other transactions contemplated by the merger agreement. Certain factors considered by the Board of Directors in reaching its decision to approve the merger agreement and the merger can be found in the section titled "Proposal No. 1—Adoption of the Merger Agreement—Reasons for the Merger" beginning on page 44 of this proxy statement.

         The Board of Directors unanimously recommends that Headwaters stockholders vote:

(1)

"FOR" the proposal to adopt the merger agreement, approving the transactions contemplated thereby, including the merger;



(2)

"FOR" the merger-related named executive officer compensation proposal; and



(3)

"FOR" the adjournment proposal.

Record Date and Voting Information (Page 31)

        Only stockholders who hold shares of our common stock at the close of business on December 23, 2016, which we refer to as the "record date" in this proxy statement, will be entitled to vote at the special meeting. Each share of our common stock outstanding on the record date will be entitled to one vote on each matter submitted to our stockholders for approval at the special meeting. As of the record date for the special meeting, there were 74,883,657 outstanding shares of our common stock entitled to vote at the special meeting.

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Quorum (Page 31)

        The presence in person or by proxy of the holders of record of a majority of the shares of our common stock issued and outstanding and entitled to vote at the meeting is necessary and sufficient to constitute a quorum for the transaction of any business at the special meeting.

Required Vote; Effect of Abstentions and Broker Non-Votes (Page 31)

        Adoption of the merger agreement requires the affirmative vote of the holders of a majority of the outstanding shares of Headwaters common stock entitled to vote at the special meeting. Approval of each of the merger-related named executive officer compensation proposal and the adjournment proposal requires the affirmative vote of the holders of a majority of the shares of Headwaters common stock that are present in person or by proxy and entitled to vote on such proposal.

        Abstentions will have the same effect as votes "AGAINST" the merger proposal, the merger-related named executive officer compensation proposal and the adjournment proposal.

        Shares not in attendance will have no effect on the outcome of any vote on the merger-related named executive officer compensation proposal or the adjournment proposal, but will have the same effect as votes "AGAINST" the merger proposal.

        If you hold your shares through a nominee (as defined below) and fail to instruct your nominee on how you wish your shares of Headwaters common stock to be voted using the voting instruction form provided by your nominee, then your shares will not be voted. The "broker non-votes" (as defined below), if any, will not be counted as votes either "FOR" or "AGAINST" the merger-related named executive officer compensation proposal or the adjournment proposal, but will have the effect of a vote "AGAINST" the merger proposal.

Voting by Stockholders (Page 32)

        Any Headwaters stockholder of record entitled to vote may submit a proxy by returning a signed proxy card by mail, through the internet or by telephone, or may vote in person by appearing at the special meeting. If you are a beneficial owner and hold your shares of Headwaters common stock in "street name" through a broker, bank or other nominee, which we refer to as a "nominee" in this proxy statement, you should instruct your nominee on how you wish your shares of Headwaters common stock to be voted using the instructions provided by your nominee. The nominee cannot vote on these proposals. Therefore, it is important that you cast your vote or instruct your broker, bank or nominee on how you wish your shares to be voted. If you are a street name holder and wish to vote the shares beneficially owned by you in person by ballot at the special meeting, you must provide a "legal proxy" from your nominee, giving you the right to vote the shares at the special meeting.

Voting by Headwaters' Directors and Executive Officers as to the Merger Proposal (Page 33)

        At the close of business on December 23, 2016, the record date for the special meeting, our directors and executive officers and their affiliates beneficially owned, in the aggregate, 2,044,276 shares of our common stock which they are entitled to vote at the special meeting, representing approximately 2.7% of the shares of our common stock outstanding on the record date and entitled to vote at the special meeting.

Delisting and Deregistration of Our Common Stock (Page 57)

        Upon completion of the merger, we will remove our common stock from listing on the NYSE and price quotations in the public market will no longer be available for our common stock, and the registration of our common stock under the Exchange Act will be terminated.

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Recommendation of Our Board of Directors (Page 48)

        After considering various reasons to approve the merger agreement, as well as certain countervailing factors, the Board of Directors unanimously determined the merger agreement, the merger and the other transactions contemplated by the merger agreement, to be advisable, fair to and in the best interests of Headwaters and its stockholders, and unanimously approved the merger agreement, the merger and the other transactions contemplated by the merger agreement. Certain factors considered by the Board of Directors in reaching its decision to approve the merger agreement and the merger can be found in the section titled "Proposal No. 1—Adoption of the Merger Agreement—Reasons for the Merger" beginning on page 44 of this proxy statement.

         The Board of Directors unanimously recommends that you vote "FOR" the adoption of the merger agreement, approving the transactions contemplated thereby, including the merger.

Opinion of Headwaters Financial Advisor (Page 48 and Annex C)

        At the November 19, 2016 meeting of the Board of Directors, Deutsche Bank Securities Inc. (" Deutsche Bank "), financial advisor to Headwaters, rendered its oral opinion to the Board of Directors, confirmed by delivery of a written opinion dated November 20, 2016, to the effect that as of the date of such opinion, and based upon and subject to the assumptions made, procedures followed, matters considered and limitations, qualifications and conditions on the review undertaken in connection therewith, as described in Deutsche Bank's opinion, the consideration of $24.25 in cash per share of Headwaters common stock was fair, from a financial point of view, to the holders of Headwaters common stock (other than Boral and its affiliates). Deutsche Bank did not express any opinion with respect to the additional consideration, if any.

         The full text of Deutsche Bank's written opinion, dated November 20, 2016, which sets forth the assumptions made, procedures followed, matters considered and limitations, qualifications and conditions on the review undertaken in connection with the opinion, is attached to this proxy statement as Annex C and is incorporated herein by reference. The summary of Deutsche Bank's opinion set forth in this proxy statement is qualified in its entirety by reference to the full text of the opinion. Deutsche Bank's opinion was addressed to, and for the use and benefit of, the Board of Directors in connection with and for the purpose of its evaluation of the merger. Deutsche Bank's opinion does not constitute a recommendation as to how any holder of Headwaters common stock should vote with respect to the merger or any related matter. Deutsche Bank's opinion was limited solely to the fairness of the consideration of $24.25 in cash per share of Headwaters common stock, from a financial point of view, to the holders of outstanding Headwaters common stock (other than Boral and its affiliates), and Deutsche Bank did not express any opinion as to the underlying decision by Headwaters to engage in the merger or the relative merits of the merger as compared to any alternative transactions or business strategies.

Interests of Certain Persons in the Merger (Page 57)

        In considering the recommendation of the Board of Directors that Headwaters stockholders vote to approve the proposal to adopt the merger agreement, which we refer to as the Board of Directors' "recommendation" in this proxy statement, you should be aware that Headwaters' directors and executive officers have interests in the merger that may be different from, or in addition to, the interests of Headwaters' stockholders generally. Interests of directors and executive officers that may be different from or in addition to the interests of Headwaters' stockholders include, but are not limited to:

•

the merger agreement provides for the cash settlement of all outstanding Headwaters stock options, stock appreciation rights, restricted shares, restricted stock units, and amounts deferred under the Headwaters Director Deferred Compensation Plan, in each case whether vested or

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unvested; the treatment of outstanding equity awards is described in more detail under "Summary Term Sheet—Treatment of Equity and Equity-Based Awards" beginning on page 11);

•

Kirk Benson, our Chief Executive Officer, and our other executive officers are party to employment agreements and change of control agreements with Headwaters that provide for severance benefits in the event of certain qualifying terminations of employment in connection with or following the merger. These agreements are discussed in more detail in the section titled Proposal No. 2—Advisory Vote on Merger-Related Named Executive Officer Compensation" beginning on page 98;



•

continued indemnification rights and directors' and officers' liability insurance to be provided by the surviving company described below under "Terms of the Merger Agreement—Directors' and Officers' Indemnification and Insurance" beginning on page 90.

        Certain of these interests are discussed in more detail in the sections titled "Proposal No. 1—Adoption of the Merger Agreement—Interests of Certain Persons in the Merger" beginning on page 57 of this proxy statement. The members of the Board of Directors were aware of the different or additional interests set forth herein and considered these interests, among other matters, in evaluating and overseeing the negotiation of the merger agreement and the merger, and in recommending to the stockholders of Headwaters that they adopt the merger agreement, and approve the transactions contemplated thereby, including the merger.

Financing of the Merger (Page 57)

        The merger is not conditioned on Boral obtaining the proceeds of any financing. Boral currently expects to finance the merger by way of (i) its recently completed offer of Boral equity securities which raised approximately AUD$2.05 billion, which we refer to as the offer, (ii) USD$0.8 billion of debt from a committed bridge acquisition facility and (iii) existing cash on Boral's balance sheet.

        The offer included an institutional component and a retail component. As of the date of this proxy statement, the offer has been completed, and raised approximately AUD$2.05 billion.

        Concurrently with the signing of the merger agreement, Boral also entered into a committed bridge acquisition facility agreement, which we refer to as the bridge facility agreement, dated November 21, 2016 with Citibank N.A. and JPMorgan Chase Bank, N.A., which we refer to as the bridge lenders. The ability of Boral to request the making of loans from the bridge lenders under the bridge facility agreement is subject to the satisfaction (or waiver) of certain conditions set forth therein and the bridge facility agreement contains representations and warranties, affirmative, negative and financial covenants and events of default usual for a facility of this nature.

        We anticipate that the total amount of funds necessary to complete the merger and the other transactions contemplated by the merger agreement will be approximately $2.5 billion. These funds include the funds needed to:

•

pay our stockholders (including equity award holders) the amount due under the merger agreement;



•

refinance or repay certain of our outstanding indebtedness, including our existing senior secured loan and revolving credit facilities; and



•

pay customary fees and expenses in connection with the transactions contemplated by the merger agreement.

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Regulatory Matters (Page 61)

        Subject to the terms and conditions of the merger agreement, each party has agreed to prepare and file as promptly as practicable all documentation to effect all necessary applications, notices, filings and other documents and to use reasonable best efforts to obtain, as promptly as practicable, the required regulatory approvals in order to complete the merger or any of the other transactions contemplated by the merger agreement. It is possible that the required regulatory approvals may not be obtained before stockholders vote on the merger agreement. For further discussion of regulatory matters relating to the merger, see "Proposal No. 1—Adoption of the Merger Agreement—Regulatory Matters" beginning on page 61 of this proxy statement.

        In particular, the merger is subject to the expiration or termination of the applicable waiting periods under the Hart-Scott Rodino Antitrust Improvements Act of 1976, as amended, which we refer to as the HSR Act. The HSR Act provides for an initial 30 calendar day waiting period following the U.S. Federal Trade Commission's, which we refer to as the FTC, and the Antitrust Division of the U.S. Department of Justice's, which we refer to as the Antitrust Division, receipt of both parties' Premerger Notification and Report Forms before the parties may consummate the merger. Boral and Headwaters each filed its respective Premerger Notification and Report Form with the FTC and the Antitrust Division. The initial waiting period applicable to the merger will expire at 11:59 p.m. (Eastern Time) on January 6, 2017, unless the waiting period is earlier terminated by the FTC and the Antitrust Division or extended by the issuance of a request for additional information and documentary material, which we refer to as a second request, to Boral and Headwaters by the FTC or the Antitrust Division prior to that time. If, before expiration or early termination of the initial 30 calendar day waiting period, either the FTC or the Antitrust Division issues a second request, the waiting period with respect to the merger will be extended for an additional period of 30 calendar days following both parties' substantial compliance with that request unless earlier terminated by the FTC or the Antitrust Division. After that time, the waiting period may be extended only by court order or with the consent of the parties. At any time before or after the consummation of any such transactions, the FTC or the Antitrust Division could take such action under the antitrust laws of the U.S. as it deems necessary or desirable in the public interest, including seeking to enjoin the merger. Private parties (including individual States) may also bring legal actions under the antitrust laws of the U.S.

        The parties have also agreed to work cooperatively to file a joint voluntary notice with CFIUS. Upon the acceptance of such a notice, CFIUS will initiate a 30 calendar day review period at the end of which, in the absence of any unresolved national security concerns, it will conclude all action under Section 721 of Title VII of the Defense Production Act of 1950, as amended ("Section 721"). If CFIUS determines that additional review is required, it will commence a 45 calendar day investigation no later than the end of the initial 30 day review period. If at the end of the investigation CFIUS has no unresolved national security concerns it will conclude all action under Section 721. At the conclusion of such investigation, if CFIUS has unresolved national security concerns, it will send a report to the President who may act to suspend or prohibit the transaction. At any time during the course of CFIUS review or investigation, CFIUS may request that the parties take actions to mitigate any national security concerns identified. Where CFIUS has completed all action with respect to the transaction or the President has announced a decision not to exercise his authority under Section 721 with respect to the transaction, then the parties may enjoy a "safe harbor" against further action by the President or CFIUS with respect to the transaction. The parties filed a draft notice with CFIUS on December 16, 2016.

        Boral is required to make a notification filing under the ICA to the Investment Review Division of Innovation, Science and Economic Development Canada. While this filing can be made subsequent to the completion of a transaction, the parties have agreed that Boral will make the filing prior to the completion of the transaction. This will ensure that the 45 day period during which the Governor in Counsel could elect to commence a national security review under Part IV.1 of the ICA will expire

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prior to the completion of the transaction. In the event that a national security review is commenced under the ICA, and the Governor in Counsel determines that the transaction could be injurious to Canadian national security the transaction could be suspended or prohibited. At any time during a possible national security review, the Governor in Counsel may request that Boral take actions to mitigate any national security concerns identified. If Boral does not receive a notice or order under Part IV.1 of the ICA within 45 days of the submission of a completed notification filing, or in the event such notice has been sent or order made and Boral subsequently receives (i) notice that no review will be made with respect to the transaction, (ii) notice that no further action will be taken with respect to the merger or (iii) an order authorizing the transaction, the transaction can be completed under the ICA.

Material U.S. Federal Income Tax Consequences of the Merger (Page 62)

        The exchange of shares of our common stock for cash pursuant to the merger will generally be a taxable transaction for U.S. federal income tax purposes to U.S. holders (as defined in the section titled "Proposal No. 1—Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences of the Merger" beginning on page 62 of this proxy statement). If you are a U.S. holder and your shares of our common stock are converted into the right to receive cash in the merger, you will generally recognize gain or loss for U.S. federal income tax purposes in an amount equal to the difference, if any, between the amount of cash received with respect to such shares and your adjusted tax basis in such shares. The exchange of shares of our common stock for cash pursuant to the merger will generally not result in a non-U.S. holder (as defined in the section titled "Proposal No. 1—Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences of the Merger" beginning on page 62 of this proxy statement) being subject to U.S. federal income tax unless the non-U.S. holder has certain connections to the U.S. You should read the section titled "Proposal No. 1—Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences of the Merger" beginning on page 62 of this proxy statement for a more detailed discussion of the U.S. federal income tax consequences of the merger to U.S. holders and non-U.S. holders. You should also consult with your tax advisor for a complete analysis of the particular tax consequences of the merger to you, including the applicability and effect of any U.S. federal, state and local and non-U.S. tax laws.

Appraisal Rights (Page 65 and Annex D)

        Under Delaware law, you are entitled to appraisal rights in connection with the merger, in lieu of the merger consideration.

        If you comply with the requirements of Section 262 of the DGCL, you will have the right under Delaware law to receive, in lieu of the per share merger consideration, the fair value of your shares of Headwaters common stock as determined by the Delaware Court of Chancery, exclusive of any element of value arising from the accomplishment or expectation of the merger, together with interest to be paid on the amount determined to be fair value as determined by the court (subject, in the case of interest payments, to any voluntary cash payments made by the surviving company pursuant to subsection (h) of Section 262 of the DGCL). The amount determined by the Delaware Court of Chancery to be the fair value of Headwaters common stock as of the effective time of the merger could be more than, the same as or less than the merger consideration a stockholder would be entitled to receive under the terms of the merger agreement. Your appraisal rights are subject to a number of restrictions and technical requirements (including relating to the aggregate amount of shares of common stock owned by stockholders seeking appraisal). Generally, in order to perfect your appraisal rights, you must, among other things, comply with the following procedures:

•

prior to the vote on the merger proposal at the special meeting, you must deliver to Headwaters a written demand for appraisal of your shares that complies with the applicable statutory requirements;

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•

you must not vote "FOR" the proposal to adopt the merger agreement, approving the transactions contemplated thereby, including the merger, either by proxy or in person, at the special meeting;



•

you must continue to hold your shares through the effective time of the merger;



•

if the merger is approved at the special meeting, you must not submit your shares for payment of the merger consideration; and



•

within 120 days of the effective time of the merger, you must file a petition in the Court of Chancery of the State of Delaware, requesting a determination of the fair value of your shares of Headwaters common stock as of the effective time of the merger.

        Merely voting against the merger proposal will not perfect your appraisal rights. If you hold your shares in "street name," you must instruct your broker or other nominee to take action in strict compliance with the DGCL to exercise your appraisal rights. Requirements under Delaware law for exercising appraisal rights are described in further detail under "Proposal No. 1—Adoption of the Merger Agreement—Appraisal Rights" beginning on page 65 of this proxy statement. The discussion of appraisal rights contained in this proxy statement is not a full summary of the law pertaining to appraisal rights under the DGCL and is qualified in its entirety by the full text of Section 262 of the DGCL regarding appraisal rights available to stockholders of Delaware corporations in certain mergers and consolidations that is reproduced and attached as Annex D to this proxy statement. If you wish to avail yourself of your appraisal rights, you should consult your legal advisor due to the complexity of the appraisal process. Your failure to follow exactly the procedures specified under the DGCL will result in the loss of your appraisal rights.

Treatment of Equity and Equity-Based Awards (Page 73)

Stock Options

        At the effective time of the merger, each Headwaters stock option, whether vested or unvested, that is outstanding immediately prior to the effective time of the merger will be canceled, without action of the holder, and the holder thereof will be entitled only to receive a cash payment, without interest, in an amount equal to the excess, if any, of the merger consideration over the applicable exercise price for each share of Headwaters common stock subject to such Headwaters stock option; provided , however , that if the exercise price per share of Headwaters common stock equals or exceeds the merger consideration, the amount payable for such Headwaters stock option will be $0.00.

Stock Appreciation Rights

        At the effective time of the merger, each Headwaters stock appreciation right, whether vested or unvested, that is outstanding immediately prior to the effective time of the merger will be canceled, without action of the holder, and the holder thereof will be entitled only to receive a cash payment, without interest, in an amount equal to the excess, if any, of the merger consideration over the applicable base price for each share of Headwaters common stock subject to such Headwaters stock appreciation right; provided , however , that if the base price per share of Headwaters common stock equals or exceeds the merger consideration, the amount payable for such Headwaters stock appreciation right will be $0.00.

Restricted Shares

        At the effective time of the merger, each unvested Headwaters restricted share that is outstanding immediately prior to the effective time of the merger will be canceled, without action of the holder, and the holder thereof will be entitled only to receive a cash payment, without interest, in an amount equal to the merger consideration.

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Restricted Stock Units

        At the effective time of the merger, each Headwaters restricted stock unit, whether vested or unvested, that is outstanding immediately prior to the effective time of the merger will be canceled, without action of the holder, and the holder thereof will be entitled only to receive a cash payment, without interest, in an amount equal to the merger consideration.

Director Deferred Compensation Plan

        For any members of the Board of Directors who elected to have amounts deferred under the Headwaters Director Deferred Compensation Plan deemed invested in Headwaters common stock, (i) each share of Headwaters common stock purchased by Headwaters and held as treasury stock immediately prior to the effective time of the merger in connection with such deferrals will be canceled in accordance with the merger agreement, and (ii) the director will be entitled to receive a cash payment in respect of each such share, without interest, in an amount equal to the merger consideration, subject to and payable in accordance with the terms of the Headwaters Director Deferred Compensation Plan.

No Solicitation (Page 81)

        From the date of the merger agreement until the effective time of the merger or, if earlier, the termination of the merger agreement in accordance with its terms, Headwaters has agreed not to, and to cause its subsidiaries not to, and to use its reasonable best efforts to cause its and their respective representatives not to on behalf of the company, directly or indirectly:

•

solicit, initiate, knowingly encourage, facilitate or induce any inquiry or the making of any proposal that constitutes, or could reasonably be expected to lead to, any alternative proposal (as defined below in the section titled "Terms of the Merger Agreement—Additional Agreements—No Solicitation" beginning on page 81 of this proxy statement);



•

furnish information to or afford access to the business, employees, officers, contracts, properties, assets, books or records of Headwaters and its subsidiaries to any person that could reasonably be expected to lead to, or in connection with, an inquiry or an alternative proposal;



•

enter into, continue or maintain discussions or negotiations with any person with respect to an inquiry or an alternative proposal;



•

participate in or knowingly facilitate any discussions or negotiations (other than informing persons of the non-solicitation provisions set forth in the merger agreement, solely in response to a bona fide unsolicited inquiry after the date of the merger agreement) regarding, or furnish or cause to be furnished to any person or "group" (as such term is defined in Section 13(d) of the Exchange Act) any information with respect to Headwaters, or take any other action to facilitate any inquiry;



•

approve, agree to, accept, endorse or recommend any alternative proposal;



•

submit to a vote of its stockholders, approve, endorse or recommend any alternative proposal;



•

grant any waiver, amendment or release under any state anti-takeover statute;



•

grant any waiver, amendment or release under any confidentiality or standstill agreement or provisions of similar effect to which it is a party or of which it is a beneficiary (and Headwaters will enforce any such provisions, except that Headwaters will not be required to enforce, and will be permitted to waive, any provision that prohibits or purports to prohibit a proposal being made to the Board of Directors on a confidential basis to the extent that the Board of Directors determines, in its good faith judgment (after consultation with Headwaters' outside legal

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counsel), that the failure to take such action would be inconsistent with the directors' exercise of their fiduciary duties under applicable law);

•

effect any adverse recommendation change (as described below); or



•

enter into any letter of intent or agreement in principle or any agreement providing for any alternative proposal (except for permitted confidentiality agreements, as described below).

        However, if Headwaters or any of its subsidiaries or any of its or their respective representatives receives a written alternative proposal that was unsolicited after the date of the merger agreement by any person or "group" at any time prior to obtaining the stockholder approval of the proposal to adopt the merger agreement that did not result from or arise in connection with a breach of the non-solicit provisions of the merger agreement, Headwaters and its representatives may, prior to (but not after) obtaining stockholder approval of the proposal to adopt the merger agreement, take the actions set forth in the two bullets below if the Board of Directors has determined in its good faith judgment (after consultation with Headwaters' financial advisors and outside legal counsel), that such alternative proposal constitutes or could reasonably be expected to lead to a superior proposal, as described below in the section titled "Terms of the Merger Agreement—Additional Agreements—No Solicitation" beginning on page 81 of this proxy statement, and the failure to take such action would be inconsistent with the directors' exercise of their fiduciary duties under applicable law:

•

obtain from such person or "group" an executed confidentiality agreement containing terms at least as restrictive in all material respects with respect to such person or "group" as the terms of the confidentiality agreement entered into by Headwaters and Boral, dated August 18, 2016, which we refer to herein as the confidentiality agreement (which confidentiality agreement will include a standstill agreement but may permit submission of non-public, private proposals to the Board of Directors); and



•

following the entry into such confidentiality agreement, furnish information to such person or "group," enter into discussions and negotiations with such person or "group" with respect to such alternative proposal and afford access to the business, employees, officers, contracts, properties, assets, books and records of Headwaters and its subsidiaries in response to such alternative proposal.

Change of Board of Directors' Recommendation (Page 83)

        The Board of Directors unanimously recommends that the holders of Headwaters shares vote " FOR " the proposal to adopt the merger agreement, approving the transactions contemplated by the merger agreement, including the merger.

        At any time prior to obtaining the stockholder approval of the proposal to adopt the merger agreement, the Board of Directors may (i) solely upon the occurrence of an intervening event, as defined below in the section titled "Terms of the Merger Agreement—Additional Agreements—Change of Recommendation" beginning on page 83 of this proxy statement, or in the event that Headwaters has received a superior proposal (after taking into account the terms of any revised offer by Boral, as described below), withdraw, qualify or modify, or propose publicly to withdraw, qualify or modify, in a manner adverse to Boral, the Board of Directors' recommendation in favor of voting for the adoption of the merger agreement, or take any action, or make any public statement, filing or release inconsistent with such recommendation (we refer to any of the foregoing as an adverse recommendation change) (including, for the avoidance of doubt, recommending against the merger or approving, endorsing or recommending any alternative proposal) and (ii) if Headwaters has received a superior proposal (after taking into account the terms of any revised offer by Boral, as described below), terminate the merger agreement to enter into a definitive written agreement providing for such superior proposal simultaneously with the termination of the merger agreement, in the case of

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clauses (i) and (ii), if the Board of Directors has determined in good faith, after consultation with outside legal counsel, that the failure to take such action would be inconsistent with the directors' exercise of their fiduciary duties under applicable law.

        Notwithstanding the foregoing, the merger agreement provides that the Board of Directors may not make an adverse recommendation change in response to a superior proposal, or terminate the merger agreement to accept a superior proposal, unless:

•

Headwaters has complied in all material respects with the restrictions described in "Terms of the Merger Agreement—Additional Agreements—No Solicitation" and in "Terms of the Merger Agreement—Additional Agreements—Change of Recommendation";



•

Headwaters has provided prior written notice to Boral at least three business days in advance, which we refer to herein as the notice period, of taking such action, which notice will advise Boral that the Board of Directors has received a superior proposal and will include a copy of such superior proposal and all other material transaction agreements and other material documents relating to such superior proposal (or, where no such copy is available, a description of the material terms and conditions of such superior proposal);



•

during the notice period, Headwaters has and has caused its financial advisors and outside legal counsel to negotiate with Boral in good faith (to the extent Boral desires to so negotiate) to make such adjustments in the terms and conditions of the merger agreement so that such superior proposal ceases to constitute (in the judgment of the Board of Directors after consultation with Headwaters' financial advisors and outside legal counsel) a superior proposal; and



•

the Board of Directors has determined in good faith, after considering the results of such negotiations and giving effect to any proposals, amendments or modifications made or agreed to by Boral, if any, and after consultation with Headwaters' financial advisors and outside legal counsel, that such superior proposal remains a superior proposal.

        If during the notice period any revisions are made to the superior proposal, Headwaters must deliver a new written notice to Boral and must comply with the requirements described above with respect to such new written notice; however , for purposes of this sentence, references to the three business day notice period above shall be deemed to be references to a two business day notice period.

        In addition to the foregoing, the Board of Directors may not make an adverse recommendation change in response to an intervening event unless:

•

Headwaters has complied in all material respects with the restrictions described in "Terms of the Merger Agreement—Additional Agreements—No Solicitation" and in "Terms of the Merger Agreement—Additional Agreements—Change of Recommendation";



•

Headwaters has provided prior written notice to Boral at least three business days, referred to herein as the notice period, in advance of taking such action, which notice will advise Boral of the circumstances giving rise to the adverse recommendation change;



•

during the notice period, Headwaters has and has caused its financial advisors and outside legal counsel to negotiate with Boral in good faith (to the extent Boral desires to so negotiate) to make such adjustments in the terms and conditions of the merger agreement so that the failure to make such adverse recommendation change (in the judgment of the Board of Directors after consultation with Headwaters' financial advisors and outside legal counsel) would no longer be inconsistent with the directors' exercise of their fiduciary duties under applicable law; and



•

the Board of Directors has determined in good faith, after considering the results of such negotiations and giving effect to any proposals, amendments or modifications made or agreed to

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by Boral, if any, and after consultation with Headwaters' financial advisors and outside legal counsel, that the failure to make such adverse recommendation change would be inconsistent with the directors' exercise of their fiduciary duties under applicable law.

        In certain circumstances, Headwaters may be required to pay a termination fee in connection with a termination of the merger agreement pursuant to the foregoing provisions, as described under "Terms of the Merger Agreement—Termination of the Merger Agreement—Termination Fees" beginning on page 95 of this proxy statement.

Conditions to the Completion of the Merger (Page 92)

        The respective obligations of Headwaters, Boral and Merger Sub to effect the merger are subject to the satisfaction or waiver on or prior to the closing date of the following conditions:

•

receipt of Headwaters stockholder approval of the adoption of the merger agreement and the transactions contemplated thereby, including the merger;



•

the waiting period (and any extension thereof) applicable to the consummation of the merger under the HSR Act or similar antitrust law in any jurisdiction outside of the U.S. where the transaction must be notified to, and cleared or approved by, government regulators before it is legally permitted to be closed shall have been terminated or shall have expired, the parties shall have received the CFIUS clearance and clearance under the Investment Canada Act (Canada) R.S.C., 1985, c.28(1 ^st  Supp.) as amended and any regulations thereunder, which we refer to as the ICA, shall have been received; and



•

no applicable law and no judgment or other legal restraint or prohibition and no binding order or determination by any governmental entity shall be in effect, and no suit, action or other proceeding shall have been instituted by any governmental entity and remain pending that would reasonably be expected to result in a legal restraint, in each case that prevents, makes illegal or prohibits the consummation of the merger and the other transactions contemplated by the merger agreement.

        The obligations of Headwaters to consummate the merger are further subject to the following conditions:

•

the representations and warranties of Boral and Merger Sub shall be true and correct at and as of the date of the merger agreement and at and as of the closing date as if made at and as of such time (except to the extent expressly made as of an earlier date, in which case as of such earlier date), subject to certain materiality and "Boral material adverse effect" thresholds;



•

Boral and Merger Sub shall have performed in all material respects all obligations required to be performed by them under the merger agreement at or prior to the closing date; and



•

Boral shall have delivered to Headwaters a certificate certifying that the conditions relating to its representations and warranties and performance of obligations have been satisfied.

        The obligations of Boral and Merger Sub to consummate the merger are further subject to the following conditions:

•

the representations and warranties of Headwaters shall be true and correct at and as of the date of the merger agreement and at and as of the closing date as if made at and as of such time (except to the extent expressly made as of an earlier date, in which case as of such earlier date), subject to certain de minimis, materiality and "Headwaters material adverse effect" thresholds;



•

Headwaters shall have performed in all material respects all obligations required to be performed by it under the merger agreement at or prior to the closing date;

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•

during the period from the date of the merger agreement to the closing date, there shall not have occurred any fact, circumstance, effect, change, event or development that, individually or in the aggregate, has had or would reasonably be expected to have a "Headwaters material adverse effect"; and



•

Headwaters shall have delivered to Boral a certificate certifying that the conditions relating to its representations and warranties, performance of obligations and the absence of a Headwaters material adverse effect have been satisfied.

Termination of the Merger Agreement (Page 93)

        The merger agreement may be terminated at any time prior to the effective time of the merger, notwithstanding the adoption of the merger agreement by Headwaters stockholders, under specified circumstances. See the section titled "Terms of the Merger Agreement—Termination of the Merger Agreement," beginning on page 93 of this proxy statement, for more information about the circumstances in which either Headwaters or Boral could terminate the merger agreement.

Termination Fee; Effect of Termination (Page 95)

        The merger agreement provides that Headwaters or Boral, as applicable, will pay the other a cash termination fee and/or an expense reimbursement in specified circumstances. For more information about the circumstances in which Headwaters or Boral must pay a termination fee and/or an expense reimbursement in specified circumstances and the amount thereof, see the sections titled "Terms of the Merger Agreement—Termination of the Merger Agreement—Effect of Termination," "Terms of the Merger Agreement—Termination of the Merger Agreement—Termination Fees," and "Terms of the Merger Agreement—Expense Reimbursement," beginning on pages 95, 95 and 96, respectively, of this proxy statement.

        Other than as provided above or as described below in the section titled "Terms of the Merger Agreement—Fees and Expenses" beginning on page 96 of this proxy statement, all fees and expenses incurred by the parties are to be paid by the party that has incurred the fees and expenses.

Specific Performance (Page 97)

        The parties are entitled to injunctions, specific performance and other equitable relief to prevent breaches or threatened breaches of the merger agreement and to enforce specifically the terms of the merger agreement in addition to any other remedy to which they are entitled at law or equity.

Fees and Expenses (Page 96)

        All fees and expenses incurred in connection with the merger agreement, the merger and the other transactions contemplated by the merger agreement will be paid by the party incurring such fees or expenses, whether or not the merger or any of the other transactions contemplated by the merger agreement are completed, with certain exceptions expressly set forth in the merger agreement. These exceptions include certain expense reimbursements in the event of termination, as described in the section titled "Terms of the Merger Agreement—Expense Reimbursement," beginning on page 96 of this proxy statement.

Market Price of Headwaters Common Stock and Dividend Information (Page 104)

        Our common stock is listed on the NYSE under the trading symbol "HW." On November 18, 2016, the last trading day before we publicly announced the execution of the merger agreement, the high and low sale prices for our common stock as reported on the NYSE were $20.37 and $20.03 per

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share, respectively, and the closing sale price on that date was $20.09, compared to which the merger consideration represents a premium of approximately 21%.

        Under the terms of the merger agreement, we may not declare, authorize, make or pay any dividend or other distribution without the prior written consent of Boral. We do not expect to pay dividends in the foreseeable future.

Help in Answering Questions

        We greatly appreciate your cooperation in voting your shares. If you have any questions about the special meeting or the merger after reading this proxy statement, you may contact The Proxy Advisory Group, LLC, our proxy solicitor, toll-free at 888.337.7699 or 888.33.PROXY.

         Neither the SEC, nor any state securities regulatory agency has approved or disapproved of the transactions described in this proxy statement, including the merger, or determined if the information contained in this proxy statement is accurate or adequate. Any representation to the contrary is a criminal offense.

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QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER

         The following questions and answers are intended to address some commonly asked questions regarding the special meeting and the merger. These questions and answers may not address all questions that may be important to you as a holder of our common stock. Please refer to the more detailed information contained elsewhere in this proxy statement, the annexes to this proxy statement and the documents referred to or incorporated by reference in this proxy statement.

Q:    Why am I receiving these materials?

A:

You are receiving this proxy statement and the accompanying proxy card because you owned shares of our common stock at the close of business on December 23, 2016, the record date for the special meeting. Our Board is soliciting proxies for use at the special meeting to consider and vote upon the proposal to adopt the merger agreement and other matters to be voted on at the special meeting. These proxy materials provide you information for use in determining how to vote in connection with the matters to be considered at the special meeting.

Q:    When and where is the special meeting?

A:

The special meeting will take place on Friday, February 3, 2017, at 2 p.m., Mountain Standard Time, at 10701 South River Front Parkway, Suite 300, South Jordan, Utah 84095.

Q:    What matters will be voted on at the special meeting?

A:

We will ask you to consider and vote upon:

(1)

a proposal to adopt the merger agreement, approving the transactions contemplated thereby, including the merger;

(2)

a proposal to approve, by a non-binding advisory vote, the compensation arrangements disclosed in this proxy statement that may be payable to Headwaters' named executive officers in connection with the completion of the merger; and

(3)

a proposal to approve the adjournment of the special meeting from time to time if necessary or appropriate in the view of the Board of Directors, to solicit additional proxies if there are not sufficient votes at the time of the special meeting to adopt the merger agreement.

Q:    What is the proposed transaction?

A:

On the terms and subject to the conditions set forth in the merger agreement, and in accordance with the DGCL, at the effective time of the merger, Merger Sub will merge with and into Headwaters. At the effective time of the merger, the separate corporate existence of Merger Sub will cease and Headwaters will continue as the surviving company in the merger. After the merger is completed, our common stock will cease to be traded on the NYSE, the registration of our common stock under the Exchange Act will be terminated and we will no longer be required to file periodic reports with the SEC.

Q:    What will I receive if the merger is completed?

A:

If the merger is completed, you will have the right to receive (x) $24.25 in cash, without interest, and (y) the additional consideration, if any, less any applicable withholding taxes, for each share of our common stock you own, unless you are entitled to demand and have properly demanded appraisal for such shares in accordance with, and you comply in all respects with, Section 262 of the DGCL. In either case, as a result of the merger, your shares will be canceled and you will not own shares in the surviving company.

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Q:    How does the per-share merger consideration compare to the market price of Headwaters common stock prior to the public announcement of the merger agreement?

A:

The per-share consideration of $24.25 represents a premium of (i) approximately 21% to Headwaters' closing stock price on November 18, 2016, the last trading day prior to the date on which public announcement of the execution of the merger agreement was made, and (ii) approximately 34%, 36% and 36% over the volume weighted average share price of the common stock during the 30, 60 and 90 days, respectively, ended November 18, 2016, the last trading day prior to the date on which public announcement of the execution of the merger agreement was made.

Q:    Should I send in my stock certificates now?

A:

No. Please do not send your stock certificates now. If the merger is completed, you will receive shortly thereafter a letter of transmittal instructing you to send your stock certificates to the paying agent in order to receive the cash payment of the merger consideration for each share of our common stock represented by your stock certificates. You should use the letter of transmittal to exchange your stock certificates for the cash payment to which you are entitled upon completion of the merger. Please do not send in your stock certificates with your proxy card.

Q:    What happens if I sell or transfer my shares of common stock after the record date, but before the special meeting?

A:

If you sell or transfer your shares of our common stock after the record date, but before the special meeting, you will transfer the right to receive the merger consideration, if the merger is completed, to the person to whom you sell or transfer your shares of our common stock, but you will retain your right to vote those shares at the special meeting. Even if you sell or otherwise transfer your shares of common stock after the record date, we encourage you to complete, date, sign and return the enclosed proxy or vote via the Internet or telephone.

Q:    What vote is required to approve the merger proposal and thereby approve the merger?

A:

Under Delaware law, and as a condition to the completion of the merger, approval of the merger proposal requires the affirmative vote of the holders of a majority of the outstanding shares of Headwaters common stock entitled to vote at the special meeting. Accordingly, (1) a Headwaters stockholder's failure to submit a proxy card or to vote in person at the special meeting, (2) an abstention from voting or (3) a broker non-vote, if any, will have the same effect as a vote "AGAINST" the merger proposal. As of the record date, there were 74,883,657 shares of Headwaters common stock outstanding.

Q:    What vote is required for the merger-related named executive officer compensation proposal?

A:

Assuming a quorum is present, approval of the merger-related named executive officer compensation proposal requires the affirmative vote of the holders of a majority of the shares of Headwaters common stock that are present at the special meeting in person or by proxy and entitled to vote on the proposal. Abstentions will have the same effect as a vote "AGAINST" the merger-related named executive officer compensation proposal. Broker non-votes, if any, and, assuming a quorum is present, shares not in attendance at the special meeting, will have no effect on the outcome of any vote on the merger-related named executive officer compensation proposal.

Q:    What vote is required for the adjournment proposal?

A:

Assuming a quorum is present, approval of the adjournment proposal requires the affirmative vote of the holders of a majority of the shares of Headwaters common stock that are present at the

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special meeting in person or by proxy and entitled to vote on the proposal. Abstentions will have the same effect as a vote "AGAINST" the adjournment proposal. Broker non-votes, if any, and, assuming a quorum is present, shares not in attendance at the special meeting, will have no effect on the outcome of any vote on the adjournment proposal.

Q:    Has any company stockholder agreed to vote company shares in favor of the merger?

A.

Yes. Concurrently with the execution of the merger agreement, Kirk A. Benson, our Chairman and Chief Executive Officer, entered into the voting agreement with Boral, pursuant to which Mr. Benson, among other things, is required to vote in favor of the adoption of the merger agreement. As of December 23, 2016, Mr. Benson is entitled to vote approximately 1,575,665 shares of our common stock, or approximately 2.1% of the shares of our common stock outstanding and entitled to vote. See the section titled "Proposal No. 1—Adoption of the Merger Agreement—Voting Agreement" beginning on page 60 of this proxy statement.

Q.    What is "merger-related compensation"?

A.

"Merger-related compensation" is certain compensation that is tied to or based on the completion of the merger and may be payable to Headwaters' named executive officers under our existing plans or agreements, which is the subject of the merger-related named executive officer compensation proposal. See "Proposal No. 2—Advisory Vote on Merger-Related Named Executive Officer Compensation" beginning on page 98 of this proxy statement.

Q.    Why am I being asked to cast a non-binding, advisory vote to approve "merger-related compensation" payable to Headwaters' named executive officers under its plans or agreements?

A.

In accordance with the rules promulgated under Section 14A of the Exchange Act, Headwaters is providing its stockholders with the opportunity to cast a non-binding, advisory vote on the merger-related named executive officer compensation proposal on the compensation that may be payable to our named executive officers in connection with the merger.

Q.    What will happen if the stockholders do not approve the "merger-related compensation" in the merger-related named executive officer compensation proposal at the special meeting?

A:

Approval of the merger-related named executive officer compensation proposal is not a condition to the completion of the merger. The vote with respect to the merger-related named executive officer compensation proposal is an advisory vote and will not be binding on Headwaters or Boral. Further, the underlying compensation plans and agreements are contractual in nature and are not, by their terms, subject to stockholder approval. Accordingly, payment of the "merger-related compensation" is not contingent on stockholder approval of the merger-related named executive officer compensation proposal.

Q.    Are there any other risks to me from the merger that I should consider?

A.

Yes. There are risks associated with all business combinations, including the merger. Please see the section titled "Cautionary Statement Concerning Forward-Looking Information" beginning on page 27 of this proxy statement.

Q:    What constitutes a quorum?

A:

At the special meeting, stockholders holding a majority of the shares entitled to vote at the special meeting, represented in person or by proxy, will constitute a quorum. When a quorum is present to organize a meeting, it is not broken by the subsequent withdrawal of any stockholders. Abstentions and broker non-votes, if any, are considered as present for the purpose of determining the presence of a quorum.

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Q:    Do any of Headwaters' directors or officers have interests in the merger that may differ from those of Headwaters shareholders generally?

A:

In considering the recommendation of the Board of Directors with respect to the proposal to approve and adopt the merger agreement, you should be aware that our directors and executive officers have interests in the merger that may be different from, or in addition to, your interests as a shareholder. The members of the Board of Directors were aware of these different or additional interests and considered these interests, among other matters, in evaluating and overseeing the negotiation of the merger agreement and the merger, and in recommending to the stockholders of Headwaters that they adopt the merger agreement, and approve the transactions contemplated thereby, including the merger. These interests are discussed in more detail in the sections titled "Proposal No. 1—Adoption of the Merger Agreement—Interests of Certain Persons in the Merger" beginning on page 57 of this proxy statement.

Q:    How does the Board of Directors recommend that I vote?

A:

After considering various reasons to approve the merger agreement, as well as certain countervailing factors, the Board of Directors unanimously determined the merger agreement, the merger and the other transactions contemplated by the merger agreement, to be advisable, fair to and in the best interests of Headwaters and its stockholders and unanimously approved the merger agreement, the merger and the other transactions contemplated by the merger agreement. Certain factors considered by the Board of Directors in reaching its decision to approve the merger agreement and the merger can be found in the section titled "Proposal No. 1—Adoption of the Merger Agreement—Reasons for the Merger" beginning on page 44 of this proxy statement.

         The Board of Directors unanimously recommends that Headwaters stockholders vote:

(1)

"FOR" the proposal to adopt the merger agreement, approving the transactions contemplated thereby, including the merger;



(2)

"FOR" the merger-related named executive officer compensation proposal; and



(3)

"FOR" the adjournment proposal.

Q:    What is the difference between holding shares as a stockholder of record and a beneficial owner?

A:

Most of our stockholders hold their shares through a nominee rather than directly in their own names. As summarized below, there are some distinctions between shares held of record and those owned beneficially.

•

Stockholder of Record.   If your shares are registered directly in your name with our transfer agent, American Stock Transfer & Trust Company, you are considered the stockholder of record with respect to those shares and this proxy statement is being sent directly to you by us. As the stockholder of record, you have the right to grant your voting proxy directly to the proxies named in the enclosed proxy card or to vote your shares in person at the special meeting. We have enclosed a proxy card for you to use.

•

Beneficial Owner.   If your shares are held in a brokerage account or by a bank or other nominee, you are considered the beneficial owner of shares held in "street name," and this proxy statement is being forwarded to you, together with a voting instruction card, by your nominee who is considered the stockholder of record with respect to those shares. As the beneficial owner, you have the right to direct your nominee on how to vote your shares and you are also invited to attend the special meeting where you may vote your shares in person by following the procedure described below.

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Q:    How do I vote my shares of Headwaters common stock?

A:

Before you vote, you should carefully read and consider the information contained in or incorporated by reference in this proxy statement, including the annexes. You should also determine whether you hold your shares of our common stock directly in your name as a stockholder of record or through a nominee, because this will determine the procedure that you must follow in order to vote. You are a stockholder of record if you hold your Headwaters common stock in certificate form or if you hold your Headwaters common stock in your name directly with our transfer agent, American Stock Transfer & Trust Company. If you are a stockholder of record, you may vote in any of the following ways:

•

Via the Internet —If you choose to grant a proxy via the internet, go to the website indicated on the enclosed proxy card and follow the easy instructions. You will need the control number shown on your proxy card in order to vote.

•

Via Telephone —If you choose to grant a proxy via telephone, use a touch-tone telephone to call the phone number indicated on the enclosed proxy card and follow the easy voice prompts. You will need the control number shown on your proxy card in order to vote.

•

Via Mail —If you choose to grant a proxy by mail, simply mark your proxy card, date and sign it, and return it in the postage-paid envelope provided. Proxy cards that are returned without a signature will not be counted as present at the special meeting and cannot be voted.

•

At the Special Meeting —Stockholders of record who attend the special meeting may vote in person by filling out a ballot at the meeting, and any previously submitted proxies will be revoked by the vote cast at the special meeting. Even if you intend to attend and vote at the special meeting, our Board recommends that you grant a proxy via the internet, telephone or mail in case you are later unable to attend the special meeting to ensure that your vote is counted.

Q:    If I hold my shares through a nominee, will my nominee vote my shares for me?

A:

Your nominee will not be able to vote on the merger or any proposal without your instructions. You should follow the procedures provided by your nominee regarding the voting of your shares. If you do not instruct your nominee to vote your shares, your shares will not be voted, which will be treated as a vote against the proposal to adopt the merger agreement.

Q:    What is a broker non-vote?

A:

Under NYSE rules, banks, brokers and other nominees may use their discretion to vote uninstructed shares (i.e., shares held of record by banks, brokerage firms or other nominees but with respect to which the beneficial owner of such shares has not provided instructions on how to vote on a particular proposal) with respect to matters that are considered to be "routine," but not with respect to "non-routine" matters. A "broker non-vote" occurs on an item when (i) a broker, nominee or intermediary has discretionary authority to vote on one or more proposals to be voted on at a meeting of stockholders, but is not permitted to vote on other proposals without instructions from the beneficial owner of the shares and (ii) the beneficial owner fails to provide the broker, nominee or intermediary with such instructions. Because none of the proposals to be voted on at the special meeting are routine matters for which brokers may have discretionary authority to vote, we do not expect there to be any broker non-votes.

Q:    What happens if I return my proxy card but I do not indicate how to vote?

A:

If you sign and properly return your proxy card, but do not include instructions on how to vote, your shares of our common stock will be voted

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(1)

"FOR" the proposal to adopt the merger agreement, approving the transactions contemplated thereby, including the merger;



(2)

"FOR" the merger-related named executive officer compensation proposal; and



(3)

"FOR" the adjournment proposal.

We do not currently intend to present any other proposals for consideration at the special meeting. If other proposals requiring a vote of stockholders are brought before the special meeting in a proper manner, the persons named in the enclosed proxy card will have discretion to vote the shares they represent in accordance with their best judgment.

Q:    What happens if I abstain from voting on a proposal?

A:

If you sign and return a proxy card or grant a proxy over the internet or by telephone but affirmatively abstain from voting on the merger proposal, the merger-related named executive officer compensation proposal or the adjournment proposal, it will have the same effect as a vote "AGAINST" the applicable proposal or proposals.

Q:    May I change my vote after I have mailed my signed proxy card or otherwise submitted my vote?

A:

Yes. Even if you sign and return the proxy card accompanying this proxy statement, you retain the power to revoke your proxy or change your vote. You can revoke your proxy or change your vote at any time before it is exercised by giving written notice to our Corporate Secretary at Headwaters Incorporated, 10701 South River Front Parkway, Suite 300, South Jordan, Utah 84095, United States, Attn: Corporate Secretary, specifying such revocation or change in vote. You may also change your vote by delivery of a valid, later-dated proxy prior to the special meeting or by attending and voting at the special meeting.

Q:    What does it mean if I receive more than one set of proxy materials?

A:

This means that you own shares of our common stock that are registered under different names. For example, you may own some shares directly as a stockholder of record and other shares through a broker or you may own shares through more than one broker. In these situations, you will receive multiple sets of proxy materials. You must complete, sign, date and return all of the proxy cards or follow the instructions for any alternative voting procedure on each of the voting instruction cards that you receive in order to vote all of the shares you own. Each proxy card you receive comes with its own prepaid return envelope; if you vote by mail, make sure you return each proxy card in the return envelope that accompanies that proxy card.

Q:    When do you expect the merger to be completed?

A:

Headwaters and Boral are working to complete the merger promptly, and we intend it to be completed in mid-calendar year 2017. The merger is subject, however, to various regulatory approvals and other conditions to closing, which are described in more detail in this proxy statement, and it is possible that factors outside the control of either company could result in the merger being completed at a later time, or not at all.

Q:    If the merger is completed, how will I receive the cash for my shares?

A:

If the merger is completed and your shares of our common stock are held in book-entry through the Depository Trust Company, which we refer to as "DTC" in this proxy statement, or in "street name" by a broker or other nominee, the cash proceeds will be deposited into your bank or brokerage account without any further action on your part. If you are a stockholder of record with your shares held in certificate form or held directly in your name in book-entry form other than

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through DTC, you will receive a letter of transmittal with instructions for returning such letter of transmittal, and, in the case of holders of share certificates, how to send your share certificates to the paying agent, in connection with the merger. The paying agent will issue and deliver to you a check for your shares after you comply with these instructions. See the section titled "Terms of the Merger Agreement—Merger Consideration—Payment Procedures" beginning on page 74 of this proxy statement.

Q:    Is the merger taxable to me?

A:

The exchange of shares of our common stock for cash pursuant to the merger will generally be a taxable transaction for U.S. federal income tax purposes to U.S. holders (as defined in the section titled "Proposal No. 1—Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences of the Merger—Tax Consequences to U.S. Holders" beginning on page 63 of this proxy statement). If you are a U.S. holder and your shares of our common stock are converted into the right to receive cash in the merger, you will generally recognize gain or loss for U.S. federal income tax purposes in an amount equal to the difference, if any, between the amount of cash received with respect to such shares and your adjusted tax basis in such shares. The exchange of shares of our common stock for cash pursuant to the merger will generally not result in a non-U.S. holder (as defined in the section titled "Proposal No. 1—Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences of the Merger—Tax Consequences to Non-U.S. Holders" beginning on page 64 of this proxy statement) being subject to U.S. federal income tax unless the non-U.S. holder has certain connections to the U.S. You should read the section titled "Proposal No. 1—Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences of the Merger" beginning on page 62 of this proxy statement for a more detailed discussion of the U.S. federal income tax consequences of the merger to U.S. holders and non-U.S. holders. You should also consult your tax advisor for a complete analysis of the particular tax consequences of the merger to you, including the applicability and effect of any U.S. federal, state and local and non-U.S. tax laws.

Q:    What happens if the merger is not completed?

A:

If the merger agreement is not adopted by the stockholders at the special meeting or if the merger is not completed for any other reason, stockholders will not receive the merger consideration or any payment for their shares of our common stock in connection with the merger. Instead, Headwaters will remain a public company and our common stock will continue to be listed and traded on the NYSE and registered under the Exchange Act and Headwaters will continue to file periodic reports with the SEC. In certain circumstances, we may be required to pay, or may be entitled to receive, a termination fee, may be required to reimburse Boral's expenses (subject to certain limitations) or we may seek other remedies in connection with a termination of the merger agreement, in each case, as described under "Terms of the Merger Agreement—Termination of the Merger Agreement—Termination Fees" and "Terms of the Merger Agreement—Termination of the Merger Agreement—Effect of Termination" beginning on page 95 of this proxy statement.

Q:    Am I entitled to exercise appraisal rights instead of receiving the merger consideration for my shares?

A:

Yes. In order to exercise your appraisal rights, you must follow the requirements set forth in Section 262 of the DGCL. Under Delaware law, if the merger is completed, stockholders of Headwaters who do not vote in favor of adopting the merger agreement and who meet the other requirements set forth in Section 262 of the DGCL will have the right to receive payment of the fair value of their shares as determined by the Delaware Court of Chancery, exclusive of any element of value arising from the accomplishment or expectation of the merger, together with

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interest to be paid on the amount determined to be fair value as determined by the court (subject, in the case of interest payments, to any voluntary cash payments made by the surviving company pursuant to subsection (h) of Section 262 of the DGCL). Your appraisal rights are subject to a number of restrictions and technical requirements (including relating to the aggregate amount of shares of common stock owned by stockholders seeking appraisal). Appraisal rights will only be available to Headwaters stockholders that deliver to Headwaters a written demand for appraisal of their shares prior to the special meeting, do not vote in favor of the merger proposal, hold their shares continuously through the effective time of the merger, do not submit their shares for payment of the merger consideration, and otherwise comply with the statutory procedures and requirements set forth in Section 262 of the DGCL, which are summarized in this proxy statement. The amount determined by the Delaware Court of Chancery to be the fair value of Headwaters stock as of the effective time of the merger could be more than, the same as, or less than the merger consideration a stockholder would be entitled to receive under the terms of the merger agreement. A summary of Section 262 of the DGCL can be found along with additional information about appraisal rights under "Proposal No. 1—Adoption of the Merger Agreement—Appraisal Rights" beginning on page 65 of this proxy statement. The discussion of appraisal rights contained in this proxy statement is not a full summary of the law pertaining to appraisal rights under the DGCL and is qualified in its entirety by the full text of Section 262 of the DGCL that is attached as Annex D to this proxy statement.

Q:    Who will count the votes?

A:

The votes will be counted by Broadridge Financial Solutions Inc.

Q:    Where can I find the voting results of the special meeting?

A:

Headwaters intends to announce preliminary voting results at the special meeting and publish final results in a Current Report on Form 8-K that will be filed with the SEC following the special meeting. All periodic and current reports Headwaters files with the SEC are publicly available when filed. See "Where Stockholders Can Find More Information" beginning on page 109 of this proxy statement.

Q:    What is "householding"?

A:

"Householding" means that we deliver a single set of proxy materials when requested to households with multiple stockholders, provided certain conditions are met. Householding reduces our printing and mailing costs.

If you or another stockholder of record sharing your address would like to receive an additional copy of the proxy materials, we will promptly deliver it to you upon your request in one of the following manners:

•

By sending a written request by mail to:

The Proxy Advisory Group, LLC
18 East 41st Street, Suite 2000
New York, NY 10017-6219

•

By calling The Proxy Advisory Group, LLC, toll-free at 888.337.7699 or 888.33.PROXY.

If you would like to opt out of householding in future mailings, or if you are currently receiving multiple mailings at one address and would like to request householded mailings, you may do so by contacting The Proxy Advisory Group, LLC, indicated above.

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Q:    Where can I find more information about Headwaters?

A:

You can find more information about Headwaters in its publicly filed reports with the SEC, on Headwaters' website www.headwaters.com, and in the section titled "Where Stockholders Can Find More Information" beginning on page 109 of this proxy statement.

Q:    Who can help answer my questions?

A:

If you would like additional copies, without charge, of this proxy statement or if you have questions about the merger agreement or the merger, including the procedures for voting your shares, you should contact The Proxy Advisory Group, LLC:

•

By mail, to:

The Proxy Advisory Group, LLC
18 East 41st Street, Suite 2000
New York, NY 10017-6219

•

By telephone, at 888.337.7699 or 888.33.PROXY.

        If your nominee holds your shares, you should also call your nominee for additional information.

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CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING INFORMATION

        Some of the statements contained or incorporated by reference in this proxy statement are "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, statements relating to the completion of the merger, expectations as to the managing and marketing of coal combustion products and other construction materials, the production and marketing of building products, the sales to oil refineries of residue hydrocracking catalysts, the development, commercialization, and financing of new products and other strategic business opportunities and acquisitions and other information about Headwaters which is not purely historical by nature. Forward-looking statements can usually be identified by the use of terminology such as "anticipate," "believe," "continue," "could," "estimate," "evolve," "expect," "forecast," "intend," "looking ahead," "may," "opinion," "plan," "possible," "potential," "project," "should," "will" and similar words or expressions. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially from those anticipated as a result of various factors, including: (1) Headwaters may be unable to obtain stockholder approval as required for the merger; (2) conditions to the completion of the merger, including the obtaining of required regulatory approvals, may not be satisfied; (3) the merger may involve unexpected costs, liabilities or delays; (4) the business of Headwaters may suffer as a result of uncertainty surrounding the merger; (5) the outcome of any legal proceedings related to the merger; (6) Headwaters may be adversely affected by other economic, business, and/or competitive factors; (7) the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; (8) the ability to recognize benefits of the merger; (9) risks that the merger disrupts current plans and operations and the potential difficulties in employee retention as a result of the merger; (10) other risks to consummation of the merger, including the risk that the merger will not be consummated within the expected time period or at all; (11) changing feedstock and energy prices; actions of competitors or regulators; technological developments; (12) potential disruption of Headwaters' production facilities, transportation networks and information technology systems due to war, terrorism, malicious attack, civil accidents, political events, civil unrest or severe weather; (13) potential environmental liability or product liability under existing or future laws and litigation; (14) potential liability resulting from other pending or future litigation; (15) changed accounting rules under generally accepted accounting principles promulgated by rule-setting bodies; (16) the risks described from time to time in Headwaters' reports filed with the SEC under the heading "Risk Factors," including the Annual Report on Form 10-K for the fiscal year ended September 30, 2016, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K and in other of Headwaters' filings with the SEC; and (17) general industry and economic conditions. The foregoing factors that could cause actual events to differ from expectations should not be construed as exhaustive. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which such statements were made. We can give no assurance that the conditions to the merger will be satisfied. Except as required by applicable law, Headwaters undertakes no obligation to update forward-looking statements to reflect events or circumstances arising after such date.

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PARTIES INVOLVED IN THE MERGER

Headwaters Incorporated
10701 South River Parkway, Suite 300
South Jordan, Utah 84095
United States
Telephone: +1.801.984.9400

        Headwaters is a building materials company operating in the building products and construction materials sectors. Our vision is to improve lives through innovative advancements in building products and materials. We sell building products such as manufactured architectural stone, siding accessory products, roof products, concrete blocks, and windows. We also sell construction materials such as CCPs, including bottom ash, synthetic gypsum and fly ash, which is primarily used as a partial replacement for Portland cement in concrete.

        Headwaters' common stock is listed on the NYSE under the symbol "HW."

        Headwaters' principal executive offices are located at 10701 South River Front Parkway, Suite 300, South Jordan, Utah 84095, United States, its telephone number is +1.801.984.9400 and its internet website address is www.headwaters.com. The information provided on or accessible through Headwaters' website, other than securities filings that are otherwise incorporated herein by reference, is not part of this proxy statement and is not incorporated in this proxy statement by this or any other reference to Headwaters' website provided in this proxy statement.

        Additional information about Headwaters is contained in its public filings, certain of which we incorporate by reference herein. See "Where Stockholders Can Find More Information" beginning on page 109 of this proxy statement.

Boral Limited
Level 3
40 Mount St.
North Sydney, NSW 2060
Australia
Telephone: +61.2.9220.6300

        Boral Limited engages in the provision of building and construction materials. It operates through three divisions: Boral Australia, USG Boral and Boral USA. Boral Australia is the largest integrated supplier of construction materials in Australia, supplying quarry products, concrete, asphalt, cement, and concrete placing, as well as timber, roof tiles and masonry building products. The USG Boral Gypsum Joint Venture is a 50/50 joint venture between USG Corp. and Boral Limited, and is a leading manufacturer and distributor of gypsum wallboard products across Australia, Asia and the Middle East. Boral USA manufactures and distributes clay bricks, manufactured stone, roof tiles, fly ash and composite trim and siding across the U.S., and operates a concrete and quarries business in Colorado. Boral employs around 12,000 employees globally, including in its joint venture operations. Boral is headquartered in Sydney, Australia and is listed on the ASX under the code "BLD."

        Boral's principal executive offices are located at Level 3, 40 Mount Street, North Sydney NSW 2060, Australia, its telephone number is +61.2.9220.6300 and its internet website address is www.boral.com.au. The information provided on or accessible through Boral's website is not part of this proxy statement and is not incorporated in this proxy statement by this or any other reference to Boral's website provided in this proxy statement.

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Enterprise Merger Sub, Inc.
200 Mansell Court East #305
Roswell, Georgia 30076
Telephone: +1.770.645.4500

        Merger Sub, an indirect wholly owned subsidiary of Boral, is a Delaware corporation that was incorporated on November 18, 2016 for the sole purpose of entering into the merger agreement and completing the transactions contemplated by the merger agreement, including the merger. On the terms and subject to the conditions of the merger agreement, at the effective time, Merger Sub will be merged with and into Headwaters, with Headwaters surviving the merger as an indirect wholly owned subsidiary of Boral.

        The principal executive offices of Merger Sub are located at 200 Mansell Court East #305, Roswell, Georgia 30076, and its telephone number is +1.770.645.4500.

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THE SPECIAL MEETING

         This section contains information about the special meeting of Headwaters' stockholders that has been called to consider and vote upon a proposal to adopt the merger agreement, a proposal to approve, by a non-binding advisory vote, the compensation arrangements disclosed in this proxy statement that may be payable to Headwaters' named executive officers in connection with the completion of the merger and a proposal to approve the adjournment of the special meeting from time to time if necessary or appropriate in the view of the Board of Directors, to solicit additional proxies if there are not sufficient votes at the time of the special meeting to adopt the merger agreement.

         This proxy statement is being provided to the stockholders of Headwaters as part of a solicitation of proxies by the Board of Directors for use at the special meeting to be held at the date, time and place specified below, and at any properly convened meeting following an adjournment or postponement thereof, for the purposes set forth in this proxy statement and in the accompanying notice of special meeting.

Date, Time and Place

        The special meeting of stockholders of Headwaters is scheduled to be held on Friday, February 3, 2017, at 2 p.m., Mountain Standard Time, at 10701 South River Front Parkway, Suite 300, South Jordan, Utah 84095, unless the special meeting is adjourned or postponed. We intend to mail this proxy statement and the accompanying proxy card on or about January 3, 2017 to all stockholders entitled to vote at the special meeting.

Purpose of the Special Meeting

        At the special meeting, stockholders will be asked:

•

to consider and vote upon a proposal to adopt the merger agreement, approving the transactions contemplated thereby, including the merger;



•

to consider and vote upon a proposal to approve, by a non-binding advisory vote, the compensation arrangements disclosed in this proxy statement that may be payable to Headwaters' named executive officers in connection with the completion of the merger; and



•

to consider and vote upon a proposal to approve the adjournment of the special meeting from time to time if necessary or appropriate in the view of the Board of Directors to solicit additional proxies if there are not sufficient votes at the time of the special meeting to adopt the merger agreement.

        Certain factors considered by the Board of Directors in reaching its decision to approve the merger agreement and the merger can be found in the section titled "Proposal No. 1—Adoption of the Merger Agreement—Reasons for the Merger" beginning on page 44 of this proxy statement.

Recommendations of Our Board of Directors

        After considering various reasons to approve the merger agreement, as well as certain countervailing factors, the Board of Directors unanimously determined the merger agreement, the merger and the other transactions contemplated by the merger agreement, to be advisable, fair to and in the best interests of Headwaters and its stockholders, and unanimously approved the merger agreement, the merger and the other transactions contemplated by the merger agreement. Certain factors considered by the Board of Directors in reaching its decision to approve the merger agreement and the merger can be found in the section titled "Proposal No. 1—Adoption of the Merger Agreement—Reasons for the Merger" beginning on page 44 of this proxy statement.

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The Board of Directors unanimously recommends that Headwaters stockholders vote:

(1)

"FOR" the proposal to adopt the merger agreement, approving the transactions contemplated thereby, including the merger;



(2)

"FOR" the merger-related named executive officer compensation proposal; and



(3)

"FOR" the adjournment proposal.

Record Date and Voting Information

        Only holders of record of our common stock at the close of business on December 23, 2016, the record date for the special meeting, are entitled to notice of, and to vote at, the special meeting and any adjournments or postponements thereof. Each holder of record of our common stock on the record date will be entitled to one vote for each share held as of the record date on each matter submitted to our stockholders for approval at the special meeting. If you sell or transfer your shares of our common stock after the record date but before the special meeting, you will transfer the right to receive the per share merger consideration, if the merger is completed, to the person to whom you sell or transfer your shares of our common stock, but you will retain your right to vote those shares at the special meeting.

        As of the close of business on the record date, there were 74,883,657 shares of Headwaters common stock, par value $0.001 per share, issued, outstanding and entitled to vote at the special meeting, which shares were held by approximately 276 holders of record.

        Nominees typically have the authority to vote on "routine" proposals when they have not received instructions from beneficial owners. Absent specific instructions from the beneficial owner of the shares, however, nominees are not allowed to exercise their voting discretion with respect to the approval of non-routine matters. At the special meeting, nominees do not have the authority to vote without instructions from the beneficial owner because none of the proposals is "routine."

Quorum

        At the special meeting, stockholders holding a majority of the shares entitled to vote at the special meeting, represented in person or by proxy, will constitute a quorum. When a quorum is present to organize a meeting, it is not broken by the subsequent withdrawal of any such stockholders. Abstentions and broker non-votes, if any, are considered as present for the purpose of determining the presence of a quorum. In the event that a quorum is not present, or if there are insufficient votes to adopt the merger agreement at the time of the special meeting, it is expected the meeting will be adjourned to solicit additional proxies (subject to any applicable limitations in the merger agreement).

Required Vote; Effect of Abstentions and Broker Non-Votes

        Adoption of the merger agreement requires the affirmative vote of the holders of a majority of the outstanding shares of Headwaters common stock entitled to vote at the special meeting. Assuming a quorum is present, approval of each of the merger-related named executive officer compensation proposal and the adjournment proposal requires the affirmative vote of the holders of a majority of the shares of Headwaters common stock that are present in person or by proxy and entitled to vote on such proposal. Abstentions will have the same effect as votes "AGAINST" the merger proposal, the merger-related named executive officer compensation proposal and the adjournment proposal.

        Shares not in attendance will have no effect on the outcome of any vote on the merger-related named executive officer compensation proposal or the adjournment proposal, but will have the same effect as votes "AGAINST" the merger proposal.

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        If you hold your shares through a nominee and fail to instruct your nominee on how you wish your shares of Headwaters common stock to be voted using the voting instruction form provided by your nominee, then your shares will not be voted. "Broker non-votes," if any, will not be counted as votes either "FOR" or "AGAINST" the merger-related named executive officer compensation proposal or the adjournment proposal, but will have the effect of a vote "AGAINST" the merger proposal.

        It is important that you vote your shares. Under the DGCL, the merger proposal requires the affirmative vote of the holders of a majority of the outstanding shares of our common stock entitled to vote at the special meeting and your abstaining from voting, failure to vote, or failure to instruct your Nominee to vote, will have the same effect as a vote "AGAINST" the merger proposal.

        If the special meeting is adjourned or postponed for any reason, and the record date remains unchanged, at any subsequent reconvening of the special meeting, all proxies will be voted in the same manner as they would have been voted at the original convening of the special meeting, except for any proxies that have been revoked or withdrawn in the interim.

Voting by Stockholders

        After carefully reading and considering the information contained in or incorporated by reference in this proxy statement, including the annexes, each stockholder of record of Headwaters common stock (that is, if your shares of Headwaters common stock are registered in your name with our transfer agent, American Stock Transfer & Trust Company) should grant a proxy to vote by mail, through the internet, or by telephone or attend the special meeting in person and vote by ballot, according to the instructions described below. Each beneficial owner of Headwaters common stock (that is, if your shares of Headwaters common stock are held in "street name" through a nominee) should vote by directing your nominee how to vote your shares.

Voting Methods

For Stockholders of Record:

        If your shares are held in your name on the records of our transfer agent, American Stock Transfer & Trust Company, you can vote:

•

Via the Internet —If you choose to grant a proxy via the internet, go to the website indicated on the enclosed proxy card and follow the easy instructions. You will need the control number shown on your proxy card in order to vote;



•

Via Telephone —If you choose to grant a proxy via telephone, use a touch-tone telephone to call the phone number indicated on the enclosed proxy card and follow the easy voice prompts. You will need the control number shown on your proxy card in order to vote.



•

Via Mail —If you choose to grant a proxy by mail, simply mark your proxy card, date and sign it, and return it in the postage-paid envelope provided. Proxy cards that are returned without a signature will not be counted as present at the special meeting and cannot be voted.



•

At the Special Meeting —Stockholders of record who attend the special meeting may vote in person by filling out a ballot at the meeting, and any previously submitted proxies will be revoked by the vote cast at the special meeting. Even if you intend to attend and vote at the special meeting, our Board recommends that you grant a proxy via the internet, telephone or mail in case you are later unable to attend the special meeting to ensure that your vote is counted.

        Whether or not you plan to attend the special meeting in person, we request that you complete, sign, date and return the enclosed proxy card or submit your proxy via the internet or by telephone prior to the special meeting to ensure that your shares will be voted at the special meeting. Proxies

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received at any time before the special meeting and not expired, revoked or superseded before being voted will be voted at the special meeting. If the proxy indicates a specification, it will be voted in accordance with the specification. If no specification is indicated, the proxy will be voted

(1)

"FOR" the proposal to adopt the merger agreement, approving the transactions contemplated thereby, including the merger;



(2)

"FOR" the merger-related named executive officer compensation proposal; and



(3)

"FOR" the adjournment proposal.

         Please do not send us stock certificates or other documents representing Headwaters common stock at this time. If the merger is completed, holders of Headwaters stock certificates will receive instructions regarding the procedures for exchanging their existing Headwaters stock certificates for the payment of the merger consideration.

For Beneficial Owners:

        If your shares are held in "street name" through a nominee, you have the right to direct your nominee on how to vote your shares. Because a beneficial owner is not the stockholder of record, you may not vote these shares at the special meeting unless you obtain a "legal proxy" from the nominee that holds your shares, giving you the right to vote the shares at the special meeting.

Revocation of Proxies

        Headwaters stockholders of record retain the power to revoke their proxy or change their vote, even if they sign the proxy card in the form accompanying this proxy statement, vote via the internet or vote via telephone. Headwaters stockholders can revoke their proxy at any time before it is exercised by giving written notice to our Corporate Secretary at Headwaters Incorporated, 10701 South River Front Parkway, Suite 300, South Jordan, Utah 84095, United States, Attn: Corporate Secretary, specifying such revocation. Headwaters stockholders may also change their vote by timely delivering to us a valid, later-dated proxy or by voting by ballot in person at the special meeting. Simply attending the special meeting will not constitute revocation of your proxy. If your shares are held in "street name" through a nominee, you should follow the instructions of such nominee regarding the revocation of voting instructions. If you have voted via the internet or via telephone, you may change your vote by signing on to the website and following the prompts or calling the toll-free number again and following the instructions.

Voting by Headwaters' Directors and Executive Officers as to the Merger Proposal

        At the close of business on the record date for the special meeting, directors and executive officers of Headwaters and their affiliates beneficially owned, in the aggregate, 2,044,276 shares of Headwaters common stock which they are entitled to vote at the special meeting, representing approximately 2.7% of the shares of Headwaters common stock outstanding on the record date and entitled to vote at the special meeting. We currently expect that Headwaters' directors and executive officers will vote their shares in favor of the merger proposal, although Kirk A. Benson, our Chairman and Chief Executive Officer, is the only one that has entered into any agreement obligating himself or herself to do so.

        Certain directors and executive officers of Headwaters have interests as to the merger proposal that may be different from, or in addition to, those of other Headwaters stockholders generally. For more information, see the section titled "Proposal No. 1—Adoption of the Merger Agreement—Interests of Certain Persons in the Merger" beginning on page 57 of this proxy statement.

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Expenses of Proxy Solicitation

        This proxy statement is being furnished in connection with the solicitation of proxies by our Board of Directors. Expenses incurred in connection with printing and mailing of this proxy statement and in connection with notices or other filings with any governmental entities under any laws is our responsibility. We have engaged The Proxy Advisory Group, LLC to assist in the solicitation of proxies and provide related advice and informational support, for a services fee, plus customary disbursements, which are not expected to exceed $35,000, and we will indemnify The Proxy Advisory Group, LLC for certain losses arising out of its proxy solicitation services. Copies of solicitation materials will also be furnished to banks, brokerage houses, fiduciaries and custodians holding shares of Headwaters common stock in their names that are beneficially owned by others to forward to those beneficial owners. We may reimburse persons representing beneficial owners of our common stock for their costs of forwarding solicitation materials to the beneficial owners. In addition to the solicitation of proxies by mail, proxies may be solicited by our directors, officers and employees, or representatives of The Proxy Advisory Group, LLC, in person or by telephone, email, fax or other means of communication and we may pay persons holding shares for others their expenses for sending proxy materials to their principals. No additional compensation will be paid to our directors, officers or employees for their services.

Householding

        The SEC permits companies and intermediaries (e.g., brokers) to satisfy the delivery requirements for proxy materials with respect to two or more stockholders sharing the same address by delivering a single proxy statement addressed to those stockholders. This process, which is commonly referred to as "householding," potentially means extra convenience for stockholders and cost savings for companies. Stockholders who hold their shares through a nominee, such as a broker, bank, broker-dealer or similar organization may receive notice from that nominee regarding the householding of proxy materials. As indicated in the notice, a single proxy statement will be delivered to multiple stockholders sharing an address unless contrary instructions have been received from an affected stockholder. Once a stockholder has received notice that a nominee will be householding, householding will continue until the stockholder is notified otherwise or until the stockholder has revoked consent by notifying the nominee. If you would prefer to receive separate copies of a proxy statement for other stockholders in your household, either now or in the future, please contact your nominee. Upon written or oral request to our Corporate Secretary at Headwaters Incorporated, 10701 South River Front Parkway, Suite 300, South Jordan, Utah 84095, United States, +1.800.316.6214, we will promptly provide separate copies of this proxy statement.

Tabulation of Votes

        All votes will be tabulated by Broadridge Financial Solutions, Inc., who will tabulate affirmative and negative votes, abstentions and broker non-votes.

Adjournments and Postponements

        In addition to the merger proposal and the merger-related named executive officer compensation proposal, our stockholders are also being asked to approve a proposal that will give our Board authority to adjourn the special meeting from time to time if necessary or appropriate in the view of our Board, to solicit additional proxies if there are not sufficient votes at the time of the special meeting to adopt the merger agreement. In addition, our Board could postpone the meeting before it commences, in the case of any of the circumstances described above. The merger agreement limits the right of our Board to postpone or adjourn in certain circumstances. If the special meeting is adjourned for the purpose of soliciting additional proxies, stockholders who have already submitted their proxies will be able to revoke them at any time prior to their use. If you submit a proxy and do not indicate how you wish to vote on any proposal, or if you indicate that you wish to vote in favor of the merger

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proposal but do not indicate a choice on the adjournment proposal, your shares will be voted in favor of the adjournment proposal. However, if you indicate that you wish to vote against the merger proposal, your shares will be voted in favor of the adjournment proposal only if you indicate that you wish to vote in favor of that proposal.

        Any adjournment may be made without notice to another time or place if the date, time and place to which the meeting is adjourned is announced at the meeting at which the adjournment is taken. At the adjourned meeting any business may be transacted that might have been transacted on the original date of the meeting. However, if the adjournment is for more than 30 days or, if after the adjournment, our Board fixes a new record date for the adjourned meeting, a notice of the adjourned meeting will be given to each stockholder of record entitled to vote at the adjourned meeting.

Attending the Special Meeting

        Only stockholders of record as of the close of business on December 23, 2016, or their duly appointed proxies, and "street name" holders (those whose shares are held through a nominee) who bring evidence of beneficial ownership on the record date for the special meeting, such as a copy of your account statement or similar evidence of ownership of our common stock as of the record date for the special meeting, may attend the special meeting. If you are a "street name" holder and you wish to vote at the special meeting, you must also bring a "legal proxy" from the record holder (your nominee) of the shares of our common stock authorizing you to vote at the special meeting. All stockholders should bring photo identification (a driver's license or passport is preferred), as you will also be asked to provide photo identification at the registration desk on the day of the special meeting or any adjournment or postponement of the special meeting. Everyone who attends the special meeting must abide by the rules for the conduct of the meeting. These rules will be printed on the meeting agenda. Even if you plan to attend the special meeting, we encourage you to grant a proxy to vote by the internet, telephone or mail so that your vote will be counted if you later decide not to attend the special meeting. No cameras, recording equipment, other electronic devices, large bags or packages will be permitted in the special meeting. Stockholders will be admitted to the meeting room starting at 1:30 p.m., local time, and admission will be on a first-come, first-served basis.

Assistance

        If you need assistance in completing your proxy card or have questions regarding the special meeting, please contact The Proxy Advisory Group, LLC by telephone. Stockholders may call toll-free at 888.337.7699 or 888.33.PROXY.

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