THE CORPORATE LIBRARY

Related Party Transactions and Outside Related Director Information

Builders FirstSource, Inc. (BLDR)

4/7/2006 Proxy Information

In February 2005, with a portion of the net proceeds of our offering of notes and our senior secured credit facility, we paid a dividend to our stockholders (including JLL Partners, Inc., affiliates of which controlled our majority stockholder) and a compensation-based payment to all holders of our outstanding stock options (including vested and unvested options). Such payment to option holders was made in connection with the payment of such dividend, rather than making an adjustment to the exercise price or number of shares subject to such options. The aggregate dividend to stockholders was $201.2 million. The aggregate payment to option holders was $35.8 million (excluding applicable payroll taxes of $0.6 million), which was recognized as stock compensation expense.

JLL Partners, Inc., affiliates of which then controlled Building Products, LLC (formerly named JLL Building Products, LLC), our majority stockholder in 2005, was reimbursed by us for expenses it paid or incurred on our behalf or in connection with its investment in us. The amount reimbursed was approximately $100,000 in 2005 and $300,000 in each of 2004 and 2003. In the ordinary course of business and on terms no less favorable to us than we could obtain from unaffiliated third parties, we purchase windows from PGT Industries, Inc., a company controlled by affiliates of JLL Partners, Inc. Our President and Chief Executive Officer and Director, Floyd F. Sherman, is a director of PGT Industries, Inc.