UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________
 
FORM 8-K
________________
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported): February 20, 2019 (February 15, 2019)
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IMAGE4A11.JPG

NCI BUILDING SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
________________

Delaware
1-14315
76-0127701
(State or other jurisdiction of
incorporation)
(Commission File Number)
(I.R.S. Employer
Identification Number)
10943 North Sam Houston Parkway West
Houston, Texas
77064
(Address of principal executive offices)
(Zip Code)
 
Registrant’s telephone number, including area code: (888) 975-9436
________________
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions:
 
£
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
 
 
 
£
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
 
 
 
£
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
 
 
 
£
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company     £

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.     £

 
 


Item 1.01 Entry into a Material Definitive Agreement.
As previously announced, on January 12, 2019, NCI Building Systems, Inc. (“ we ”, “ us ”, the “ Company ” or “ NCI ”) entered into a Unit Purchase Agreement (the “ Purchase Agreement ”) with Environmental Materials, LLC, a Delaware limited liability company (“ Environmental Stoneworks ”), the Members of Environmental Materials, LLC (the “ Sellers ”) and Charles P. Gallagher and Wayne C. Kocourek, solely in their capacity as the Seller Representative (as defined in the Purchase Agreement), pursuant to which, on February 20, 2019 (the “ Closing Date ”), NCI’s wholly-owned subsidiary, Ply Gem Industries, Inc., purchased from the Sellers 100% of the outstanding limited liability company interests of Environmental Stoneworks (the “ Closing ”) for total consideration of approximately $187,000,000, including assumption of debt, subject to post-closing adjustments (the “ Aggregate Consideration ”). Following the Closing, Environmental Stoneworks became a wholly owned subsidiary of the Company.
In anticipation of the Closing, on February 15, 2019, Ply Gem Industries, Inc. borrowed $200.0 million under the Company’s asset-based revolving credit facility (the “ ABL Facility ”) to fund the payment of the Aggregate Consideration, as well as other related transaction fees and expenses. For a description of the ABL Facility, see the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on November 20, 2018.
In connection with the Closing, the Company entered into the Sixth Supplemental Indenture, dated as of February 20, 2019 (the “ Supplemental Indenture ”), among the Company, the subsidiary guarantors party thereto and Wilmington Trust, National Association, as Trustee (the “ Trustee ”), which supplements that certain Indenture, dated as of April 12, 2018 (as amended, supplemented, waived or otherwise modified from time to time, the “ Indenture ”), among the Company, the subsidiary guarantors party thereto and the Trustee. Pursuant to the terms of the Supplemental Indenture, Environmental Stoneworks and its subsidiaries agreed to fully and unconditionally guarantee the Company’s obligations under the Indenture.
A copy of the Supplemental Indenture is attached as Exhibit 4.1 to this current report on Form 8-K and is incorporated herein by reference. The foregoing description of the Supplemental Indenture does not purport to be complete and is qualified in its entirety by reference to such exhibit.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information contained in Item 1.01 concerning the Company’s obligations under the ABL Facility is hereby incorporated herein by reference.
Item 8.01 Other Events.
On February 20, 2019, the Company issued a press release announcing the Closing, a copy of which is filed as Exhibit 99.1 hereto and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits.

 
  


SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
 
NCI BUILDING SYSTEMS, INC.
 
 
 
 
 
By:
/s/ Shawn K. Poe
 
 
Name:
Shawn K. Poe
 
 
Title:
Executive Vice President and Chief Financial Officer
 
Date: February 20, 2019
 






Exhibit Index
Exhibit
Number
Description
4.1
99.1






Exhibit 4.1




EXECUTION VERSION

Sixth Supplemental Indenture
SIXTH SUPPLEMENTAL INDENTURE, dated as of February 20, 2019 (this “ Supplemental Indenture ”), among the Subsidiaries listed on Schedule 1 hereto (the “ Subsidiary Guarantors ” and each, a “ Subsidiary Guarantor ”), NCI Building Systems, Inc. (as successor by merger to Ply Gem Midco, LLC (formerly known as Ply Gem Midco, Inc., and formerly known as Pisces Midco, Inc.)), a Delaware corporation (the “ Company ”), and each other then-existing Subsidiary Guarantor under the Indenture referred to below (the “ Existing Guarantors ”), and Wilmington Trust, National Association, as Trustee under the Indenture referred to below (the “ Trustee ”).
W I T N E S S E T H:
WHEREAS, the Company, any Existing Guarantors and the Trustee have heretofore become parties to an Indenture, dated as of April 12, 2018 (as supplemented by the First Supplemental Indenture, dated as of April 12, 2018, the Second Supplemental Indenture, dated as of April 12, 2018, the Third Supplemental Indenture, dated as of April 13, 2018, the Fourth Supplemental Indenture, dated as of October 15, 2018, and the Fifth Supplemental Indenture, dated as of November 16, 2018, and as further amended, supplemented, waived or otherwise modified, the “ Indenture ”), providing for the issuance of Notes in series;
WHEREAS, Section 1308 of the Indenture provides that the Company is required to cause the Subsidiary Guarantors to execute and deliver to the Trustee a supplemental indenture pursuant to which the Subsidiary Guarantors shall guarantee the Company’s Subsidiary Guaranteed Obligations under the Notes pursuant to a Subsidiary Guarantee on the terms and conditions set forth herein and in Article XIII of the Indenture;
WHEREAS, each Subsidiary Guarantor desires to enter into such supplemental indenture for good and valuable consideration, including substantial economic benefit in that the financial performance and condition of such Subsidiary Guarantor is dependent on the financial performance and condition of the Company, the obligations hereunder of which such Subsidiary Guarantor has guaranteed, and on such Subsidiary Guarantor’s access to working capital through the Company’s access to revolving credit borrowings and term borrowings under the Senior Credit Agreements; and
WHEREAS, pursuant to Section 901 of the Indenture, the parties hereto are authorized to execute and deliver this Supplemental Indenture to amend the Indenture, without the consent of any Holder.
NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Subsidiary Guarantors, the Company, the Existing Guarantors and the Trustee mutually covenant and agree for the benefit of the Holders of the Notes as follows:
1.      Defined Terms . As used in this Supplemental Indenture, terms defined in the Indenture or in the preamble or recital hereto are used herein as therein defined. The words “herein,” “hereof” and




“hereby” and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole and not to any particular section hereof.
2.      Agreement to Guarantee . Each Subsidiary Guarantor hereby agrees, jointly and severally with the Existing Guarantors and fully and unconditionally, to guarantee the Subsidiary Guaranteed Obligations under the Indenture and the Notes on the terms and subject to the conditions set forth in Article XIII of the Indenture and to be bound by (and shall be entitled to the benefits of) all other applicable provisions of the Indenture as a Subsidiary Guarantor.
3.      Termination, Release and Discharge . Each Subsidiary Guarantor’s Subsidiary Guarantee shall terminate and be of no further force or effect, and each Subsidiary Guarantor shall be released and discharged from all obligations in respect of such Subsidiary Guarantee, as and when provided in Section 1303 of the Indenture.
4.      Parties . Nothing in this Supplemental Indenture is intended or shall be construed to give any Person, other than the Holders and the Trustee, any legal or equitable right, remedy or claim under or in respect of each Subsidiary Guarantor’s Subsidiary Guarantee or any provision contained herein or in Article XIII of the Indenture.
5.      Governing Law . THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. THE TRUSTEE, THE COMPANY, ANY OTHER OBLIGOR IN RESPECT OF THE NOTES AND (BY THEIR ACCEPTANCE OF THE NOTES) THE HOLDERS AGREE TO SUBMIT TO THE JURISDICTION OF ANY UNITED STATES FEDERAL OR STATE COURT LOCATED IN THE BOROUGH OF MANHATTAN, IN THE CITY OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS SUPPLEMENTAL INDENTURE.
6.      Ratification of Indenture; Supplemental Indentures Part of Indenture . Except as expressly amended hereby, the Indenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect. This Supplemental Indenture shall form a part of the Indenture for all purposes, and every Holder of Notes heretofore or hereafter authenticated and delivered shall be bound hereby. The Trustee makes no representation or warranty as to the validity or sufficiency of this Supplemental Indenture or as to the accuracy of the recitals to this Supplemental Indenture.
7.      Counterparts . The parties hereto may sign one or more copies of this Supplemental Indenture in counterparts, all of which together shall constitute one and the same agreement.
8.      Headings . The section headings herein are for convenience of reference only and shall not be deemed to alter or affect the meaning or interpretation of any provisions hereof.







IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first above written.
NCI Building Systems, Inc.


By: /s/ Shawn K. Poe             
Name: Shawn K. Poe
Title: Chief Financial Officer




































[Signature Page to NCI Sixth Supplemental Indenture]






SUBSIDIARY GUARANTORS :
ENVIRONMENTAL MATERIALS, LLC



By: /s/ Shawn K. Poe             
Name: Shawn K. Poe
Title: Chief Financial Officer


SCHUYLKILL STONE, LLC



By: /s/ Shawn K. Poe             
Name: Shawn K. Poe
Title: Chief Financial Officer


ENVIRONMENTAL STUCCO LLC



By: /s/ Shawn K. Poe             
Name: Shawn K. Poe
Title: Chief Financial Officer

ST. CROIX ACQUISITION, LLC



By: /s/ Shawn K. Poe             
Name: Shawn K. Poe
Title: Chief Financial Officer

CANYON ACQUISITION, LLC



By: /s/ Shawn K. Poe             
Name: Shawn K. Poe
Title: Chief Financial Officer




[Signature Page to NCI Sixth Supplemental Indenture]










ENVIRONMENTAL STONEWORKS, LLC



By: /s/ Shawn K. Poe             
Name: Shawn K. Poe
Title: Chief Financial Officer


PBCS ACQUISITION, LLC



By: /s/ Shawn K. Poe             
Name: Shawn K. Poe
Title: Chief Financial Officer


BRIDEN ACQUISITION, LLC



By: /s/ Shawn K. Poe             
Name: Shawn K. Poe
Title: Chief Financial Officer

TALUS SYSTEMS, LLC



By: /s/ Shawn K. Poe             
Name: Shawn K. Poe
Title: Chief Financial Officer


VAN WELL ACQUISITION, LLC



By: /s/ Shawn K. Poe             
Name: Shawn K. Poe
Title: Chief Financial Officer






[Signature Page to NCI Sixth Supplemental Indenture]





ENVIRONMENTAL MATERIALS, INC.



By: /s/ Shawn K. Poe             
Name: Shawn K. Poe
Title: Chief Financial Officer


ENVIRONMENTAL MATERIALS L.P.

By: Environmental Materials, Inc., its general partner



By: /s/ Shawn K. Poe             
Name: Shawn K. Poe
Title: Chief Financial Officer

WILMINGTON TRUST, NATIONAL ASSOCIATION, as Trustee

    By: /s/ Joseph P. O’Donnell     
    Name: Joseph P. O’Donnell
    Title: Vice President




















[Signature Page to NCI Sixth Supplemental Indenture]








SCHEDULE 1

 
Subsidiary Guarantors
Jurisdiction of Organization
 
Environmental Materials, LLC
Delaware
 
Schuylkill Stone, LLC
Delaware
 
Environmental Stucco LLC
Delaware
 
St. Croix Acquisition, LLC
Delaware
 
Canyon Acquisition, LLC
Delaware
 
Environmental Stoneworks, LLC
Delaware
 
PBCS Acquisition, LLC
Delaware
 
Briden Acquisition, LLC
Delaware
 
Talus Systems, LLC
Delaware
 
Brockmeyer Acquisition, LLC
Delaware
 
Van Well Acquisition, LLC
Delaware
 
Environmental Materials, Inc.
Delaware
 
Environmental Materials L.P.
Delaware







Exhibit 99.1
IMAGE4A11.JPG PLYGEMBPLOGO.JPG
NEWS RELEASE



NCI Building Systems Announces Closing of Ply Gem’s
Acquisition of Environmental Materials, LLC

CARY, NC, February 20, 2019 - NCI Building Systems, Inc. (NYSE: NCS) (“NCI” or the “Company”) announced today that NCI’s Ply Gem business has closed on the previously announced acquisition of Environmental Materials, LLC (“Environmental Stoneworks”). Under the terms of the previously announced Unit Purchase Agreement, with Environmental Stoneworks and certain of its affiliates, NCI paid total consideration of approximately $187 million, including the assumption of debt and subject to post-closing adjustments, for 100% of the outstanding limited liability company interests of Environmental Stoneworks. The transaction was financed through borrowings under the Company’s asset-based revolving credit facility.
“The acquisition of Environmental Stoneworks, when combined with our existing stone businesses, positions our organization as a market leader in stone veneer. As one of the fastest growing categories of exterior cladding materials, it allows us to better serve our residential customers, while creating considerable cross selling opportunities with our commercial customers,” said James S. Metcalf, Chairman of the Board and Chief Executive Officer. “We are extremely pleased to welcome the customers and employees of Environmental Stoneworks to our family of building product solutions.”
Environmental Stoneworks is the only national manufacturer and installer of stone veneer for the residential and commercial markets. The company offers a broad range of products suitable for local preferences along with installation services to ensure a complete turnkey solution. Environmental Stoneworks has five manufacturing facilities, twenty-one installation centers and approximately 660 employees in the United States.
Advisors
Debevoise & Plimpton served as legal counsel to NCI.  BB&T Capital Markets served as the exclusive financial advisor and Davis Graham & Stubbs served as legal counsel to Environmental Stoneworks.
About NCI Building Systems
The combination of NCI and Ply Gem, headquartered in Cary, NC, established a leading exterior building products manufacturer with a broad range of products to residential and commercial customers for both new construction and repair & remodel. With a portfolio of key products which includes windows, doors, siding, metal wall and roof systems, engineered commercial buildings, insulated metal panels, stone and other adjacent products, the Company has more than 20,000 employees across 80 manufacturing, distribution and office locations throughout North America. For more information, visit www.ncibuildingsystems.com or www.plygem.com .
Contact:
K. Darcey Matthews
Vice President, Investor Relations
281-897-7785





Forward-Looking Statements
Certain statements and information in this filing may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words “believe,” “anticipate,” “plan,” “intend,” “foresee,” “guidance,” “potential,” “expect,” “should,” “will” “continue,” “could,” “estimate,” “forecast,” “goal,” “may,” “objective,” “predict,” “projection,” or similar expressions are intended to identify forward-looking statements in this filing.
Such forward-looking statements reflect the views of management at the time such statements are made and are subject to a number of risks, uncertainties, estimates, and assumptions that may cause actual results to differ materially from current expectations, including but not limited to the ability of NCI to integrate the acquired operations, the ability to implement the anticipated business plans of the combined company and achieve anticipated benefits and cost savings, risks related to disruption of management’s attention from ongoing business operations due to the pending acquisition and the effect of the announcement of the proposed acquisition on either party’s relationships with its respective customers, vendors, lenders and businesses generally. Additionally, factors listed under “Risk Factors” set forth in the Company’s Annual Report on Form 10-K for the fiscal year ended October 28, 2018 and its Transition Report on Form 10-Q for the transition period from October 29, 2018 to December 31, 2018, and the other risks and uncertainties described in documents we file from time to time with the SEC, identify other important factors, though not necessarily all such factors, that could cause future outcomes to differ materially from those set forth in the forward-looking statements contained in this filing. The Company expressly disclaims any obligation to release publicly any updates or revisions to these forward-looking statements, whether as a result of new information, future events, or otherwise.