Delaware
|
|
3089
|
|
20-0645710
|
(State or other jurisdiction of incorporation or organization)
|
|
(Primary Standard Industrial Classification Code Number)
|
|
(I.R.S. Employer
Identification No.)
|
|
|
|
|
|
|
|
5020 Weston Parkway, Suite 400
Cary, North Carolina 27513 |
|
|
|
||
|
||
|
|
|
|
|
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|
||
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
||
|
|
|
|
|
|
(Amounts in thousands, except shares and per share data)
|
|
For the three months ended
|
||||||
|
|
September 27, 2014
|
|
September 28, 2013
|
||||
Net sales
|
|
$
|
437,848
|
|
|
$
|
407,426
|
|
Cost of products sold
|
|
339,259
|
|
|
323,258
|
|
||
Gross profit
|
|
98,589
|
|
|
84,168
|
|
||
Operating expenses:
|
|
|
|
|
|
|
||
Selling, general and administrative expenses
|
|
51,355
|
|
|
47,597
|
|
||
Amortization of intangible assets
|
|
5,307
|
|
|
5,651
|
|
||
Total operating expenses
|
|
56,662
|
|
|
53,248
|
|
||
Operating earnings
|
|
41,927
|
|
|
30,920
|
|
||
Foreign currency loss
|
|
(766
|
)
|
|
(376
|
)
|
||
Interest expense
|
|
(16,300
|
)
|
|
(22,045
|
)
|
||
Interest income
|
|
18
|
|
|
285
|
|
||
Tax receivable agreement liability adjustment
|
|
(13,988
|
)
|
|
6,669
|
|
||
Income before benefit for income taxes
|
|
10,891
|
|
|
15,453
|
|
||
Benefit for income taxes
|
|
(10,514
|
)
|
|
(1,442
|
)
|
||
Net income
|
|
$
|
21,405
|
|
|
$
|
16,895
|
|
Comprehensive income
|
|
$
|
17,282
|
|
|
$
|
20,969
|
|
Net income attributable to common shareholders per share:
|
|
|
|
|
||||
Basic
|
|
$
|
0.32
|
|
|
$
|
0.25
|
|
Diluted
|
|
$
|
0.32
|
|
|
$
|
0.25
|
|
Weighted average shares outstanding:
|
|
|
|
|
||||
Basic
|
|
67,844,546
|
|
|
67,120,389
|
|
||
Diluted
|
|
67,944,470
|
|
|
68,244,727
|
|
(Amounts in thousands, except shares and per share data)
|
|
For the nine months ended
|
||||||
|
|
September 27, 2014
|
|
September 28, 2013
|
||||
Net sales
|
|
$
|
1,116,524
|
|
|
$
|
1,032,663
|
|
Cost of products sold
|
|
890,717
|
|
|
832,389
|
|
||
Gross profit
|
|
225,807
|
|
|
200,274
|
|
||
Operating expenses:
|
|
|
|
|
|
|
||
Selling, general and administrative expenses
|
|
156,391
|
|
|
131,162
|
|
||
Amortization of intangible assets
|
|
15,841
|
|
|
14,575
|
|
||
Initial public offering costs
|
|
—
|
|
|
23,527
|
|
||
Total operating expenses
|
|
172,232
|
|
|
169,264
|
|
||
Operating earnings
|
|
53,575
|
|
|
31,010
|
|
||
Foreign currency loss
|
|
(517
|
)
|
|
(755
|
)
|
||
Interest expense
|
|
(52,065
|
)
|
|
(70,605
|
)
|
||
Interest income
|
|
64
|
|
|
359
|
|
||
Tax receivable agreement liability adjustment
|
|
(14,419
|
)
|
|
(1,474
|
)
|
||
Loss on modification or extinguishment of debt
|
|
(21,364
|
)
|
|
(18,948
|
)
|
||
Loss before provision (benefit) for income taxes
|
|
(34,726
|
)
|
|
(60,413
|
)
|
||
Provision (benefit) for income taxes
|
|
(15,933
|
)
|
|
1,676
|
|
||
Net loss
|
|
$
|
(18,793
|
)
|
|
$
|
(62,089
|
)
|
Comprehensive loss
|
|
$
|
(24,206
|
)
|
|
$
|
(60,998
|
)
|
|
|
|
|
|
||||
Basic and diluted net loss per share attributable to common shareholders
|
|
$
|
(0.28
|
)
|
|
$
|
(1.08
|
)
|
|
|
|
|
|
||||
Basic and diluted weighted average shares outstanding
|
|
67,807,801
|
|
|
57,538,917
|
|
(Amounts in thousands, except share amounts)
|
|
September 27, 2014
|
|
December 31, 2013
|
||||
ASSETS
|
|
|
|
|
||||
Current Assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
26,782
|
|
|
$
|
69,801
|
|
Accounts receivable, less allowances of $4,518 and $4,453, respectively
|
|
278,138
|
|
|
140,062
|
|
||
Inventories:
|
|
|
|
|
|
|
||
Raw materials
|
|
75,858
|
|
|
51,313
|
|
||
Work in process
|
|
28,359
|
|
|
23,817
|
|
||
Finished goods
|
|
71,490
|
|
|
60,340
|
|
||
Total inventory
|
|
175,707
|
|
|
135,470
|
|
||
Prepaid expenses and other current assets
|
|
20,502
|
|
|
23,214
|
|
||
Deferred income taxes
|
|
6,554
|
|
|
3,178
|
|
||
Total current assets
|
|
507,683
|
|
|
371,725
|
|
||
Property and Equipment, at cost:
|
|
|
|
|
|
|
||
Land
|
|
8,017
|
|
|
4,528
|
|
||
Buildings and improvements
|
|
65,670
|
|
|
43,691
|
|
||
Machinery and equipment
|
|
360,775
|
|
|
321,614
|
|
||
Total property and equipment
|
|
434,462
|
|
|
369,833
|
|
||
Less accumulated depreciation
|
|
(273,893
|
)
|
|
(258,186
|
)
|
||
Total property and equipment, net
|
|
160,569
|
|
|
111,647
|
|
||
Other Assets:
|
|
|
|
|
|
|
||
Intangible assets, net
|
|
155,006
|
|
|
110,012
|
|
||
Goodwill
|
|
450,618
|
|
|
420,228
|
|
||
Deferred income taxes
|
|
—
|
|
|
5,406
|
|
||
Other
|
|
30,986
|
|
|
23,233
|
|
||
Total other assets
|
|
636,610
|
|
|
558,879
|
|
||
|
|
$
|
1,304,862
|
|
|
$
|
1,042,251
|
|
LIABILITIES AND STOCKHOLDERS' DEFICIT
|
|
|
|
|
|
|
||
Current Liabilities:
|
|
|
|
|
|
|
||
Accounts payable
|
|
$
|
116,976
|
|
|
$
|
82,981
|
|
Accrued expenses
|
|
147,557
|
|
|
112,940
|
|
||
Current portion of long-term debt
|
|
4,300
|
|
|
—
|
|
||
Total current liabilities
|
|
268,833
|
|
|
195,921
|
|
||
Deferred income taxes
|
|
22,520
|
|
|
17,115
|
|
||
Payable to related parties pursuant to tax receivable agreement
|
|
26,042
|
|
|
11,623
|
|
||
Other long-term liabilities
|
|
52,398
|
|
|
52,560
|
|
||
Long-term debt, less current portion
|
|
1,008,525
|
|
|
817,028
|
|
||
|
|
|
|
|
||||
Commitments and contingencies
|
|
|
|
|
|
|
||
|
|
|
|
|
||||
Stockholders' Deficit:
|
|
|
|
|
|
|
||
Preferred stock $0.01 par, 50,000,000 shares authorized, none issued and outstanding
|
|
—
|
|
|
—
|
|
||
Common stock $0.01 par, 250,000,000 shares authorized, 67,845,371 and 67,223,233 issued and outstanding, respectively
|
|
678
|
|
|
672
|
|
||
Additional paid-in-capital
|
|
744,529
|
|
|
741,789
|
|
||
Accumulated deficit
|
|
(810,036
|
)
|
|
(791,243
|
)
|
||
Accumulated other comprehensive loss
|
|
(8,627
|
)
|
|
(3,214
|
)
|
||
Total stockholders' deficit
|
|
(73,456
|
)
|
|
(51,996
|
)
|
||
|
|
$
|
1,304,862
|
|
|
$
|
1,042,251
|
|
(Amounts in thousands)
|
|
For the nine months ended
|
||||||
|
|
September 27, 2014
|
|
September 28, 2013
|
||||
Cash flows from operating activities:
|
|
|
|
|
||||
Net loss
|
|
$
|
(18,793
|
)
|
|
$
|
(62,089
|
)
|
Adjustments to reconcile net loss to cash
|
|
|
|
|
|
|
||
used in operating activities:
|
|
|
|
|
|
|
||
Depreciation and amortization expense
|
|
33,916
|
|
|
32,983
|
|
||
Fair-value premium on purchased inventory
|
|
38
|
|
|
2,015
|
|
||
Fair-value decrease of contingent acquisition liability
|
|
(264
|
)
|
|
(358
|
)
|
||
Non-cash restructuring costs
|
|
3,012
|
|
|
—
|
|
||
Non-cash interest expense, net
|
|
11,606
|
|
|
9,457
|
|
||
Loss on foreign currency transactions
|
|
517
|
|
|
755
|
|
||
Non-cash litigation expense
|
|
4,593
|
|
|
—
|
|
||
Loss on modification or extinguishment of debt
|
|
21,364
|
|
|
18,948
|
|
||
Prepaid management fee write off
|
|
—
|
|
|
2,682
|
|
||
Stock based compensation
|
|
1,672
|
|
|
1,631
|
|
||
Deferred income taxes
|
|
(17,195
|
)
|
|
1,765
|
|
||
Tax receivable agreement liability adjustment
|
|
14,419
|
|
|
1,474
|
|
||
Increase (reduction) in tax uncertainty, net of valuation allowance
|
|
254
|
|
|
(1,279
|
)
|
||
Other
|
|
(224
|
)
|
|
(5
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
||
Accounts receivable, net
|
|
(102,728
|
)
|
|
(75,403
|
)
|
||
Inventories
|
|
(24,074
|
)
|
|
(11,730
|
)
|
||
Prepaid expenses and other assets
|
|
2,607
|
|
|
(5,181
|
)
|
||
Accounts payable
|
|
15,180
|
|
|
(4,192
|
)
|
||
Accrued expenses
|
|
(1,468
|
)
|
|
26,552
|
|
||
Payment of advisory termination fee to affiliate
|
|
—
|
|
|
(18,852
|
)
|
||
Cash payments on restructuring liabilities
|
|
(4,412
|
)
|
|
(2,893
|
)
|
||
Other
|
|
4,571
|
|
|
(912
|
)
|
||
Net cash used in operating activities
|
|
(55,409
|
)
|
|
(84,632
|
)
|
||
Cash flows from investing activities:
|
|
|
|
|
|
|
||
Acquisitions, net of cash acquired and outstanding checks assumed
|
|
(130,856
|
)
|
|
(99,282
|
)
|
||
Capital expenditures
|
|
(14,524
|
)
|
|
(16,314
|
)
|
||
Proceeds from sale of assets
|
|
744
|
|
|
24
|
|
||
Net cash used in investing activities
|
|
(144,636
|
)
|
|
(115,572
|
)
|
||
Cash flows from financing activities:
|
|
|
|
|
|
|
||
Proceeds from long-term debt
|
|
1,067,725
|
|
|
—
|
|
||
Net revolver borrowings (payments)
|
|
20,000
|
|
|
(1,000
|
)
|
||
Payments on long-term debt
|
|
(853,075
|
)
|
|
(148,000
|
)
|
||
Payment of tender and early call premiums
|
|
(61,142
|
)
|
|
(8,520
|
)
|
||
Net proceeds from issuance of common stock
|
|
—
|
|
|
353,407
|
|
||
Proceeds from exercises of employee stock options
|
|
1,073
|
|
|
—
|
|
||
Debt issuance costs paid
|
|
(16,721
|
)
|
|
(62
|
)
|
||
Net cash provided by financing activities
|
|
157,860
|
|
|
195,825
|
|
||
Impact of exchange rate movements on cash
|
|
(834
|
)
|
|
301
|
|
||
Net decrease in cash and cash equivalents
|
|
(43,019
|
)
|
|
(4,078
|
)
|
||
Cash and cash equivalents at the beginning of the period
|
|
69,801
|
|
|
27,194
|
|
||
Cash and cash equivalents at the end of the period
|
|
$
|
26,782
|
|
|
$
|
23,116
|
|
(Amounts in thousands)
|
|
||
Advisory termination fee to affiliate
|
$
|
18,852
|
|
2013 management fee as of date of termination
|
2,682
|
|
|
Other transaction expenses for the IPO
|
1,993
|
|
|
|
$
|
23,527
|
|
Buildings and improvements
|
10-37 years
|
Machinery and equipment, including leases
|
3-15 years
|
Leasehold improvements
|
Term of lease or useful life, whichever is shorter
|
•
|
Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities.
|
•
|
Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.
|
•
|
Level 3: Inputs that reflect the reporting entity’s own assumptions.
|
|
|
|
|
|
|
Quoted Prices
in Active Markets |
|
Significant
Other |
|
Significant
|
||||||||||
(Amounts in thousands)
|
|
|
|
Fair
|
|
for Identical
|
|
Observable
|
|
Unobservable
|
||||||||||
|
|
Carrying
|
|
Value
|
|
Assets
|
|
Inputs
|
|
Inputs
|
||||||||||
Description
|
|
Value
|
|
Total
|
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
||||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Senior Notes-6.50%
|
|
$
|
650,000
|
|
|
$
|
625,625
|
|
|
$
|
625,625
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Term Loan Facility
|
|
428,925
|
|
|
422,491
|
|
|
422,491
|
|
|
—
|
|
|
—
|
|
|||||
As of September 27, 2014
|
|
$
|
1,078,925
|
|
|
$
|
1,048,116
|
|
|
$
|
1,048,116
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Senior Notes-9.375%
|
|
$
|
96,000
|
|
|
$
|
103,440
|
|
|
$
|
103,440
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Senior Secured Notes-8.25%
|
|
756,000
|
|
|
805,140
|
|
|
805,140
|
|
|
—
|
|
|
—
|
|
|||||
As of December 31, 2013
|
|
$
|
852,000
|
|
|
$
|
908,580
|
|
|
$
|
908,580
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Windows and
|
|
Siding, Fencing
|
||||
(Amounts in thousands)
|
|
Doors
|
|
and Stone
|
||||
Balance as of December 31, 2013
|
|
|
|
|
|
|
||
Goodwill
|
|
$
|
401,861
|
|
|
$
|
468,367
|
|
Accumulated impairment losses
|
|
(327,773
|
)
|
|
(122,227
|
)
|
||
|
|
$
|
74,088
|
|
|
$
|
346,140
|
|
Currency translation adjustments
|
|
(784
|
)
|
|
(1,170
|
)
|
||
Simonton acquisition
|
|
32,344
|
|
|
—
|
|
||
Balance as of September 27, 2014
|
|
|
|
|
|
|
||
Goodwill
|
|
433,421
|
|
|
467,197
|
|
||
Accumulated impairment losses
|
|
(327,773
|
)
|
|
(122,227
|
)
|
||
|
|
$
|
105,648
|
|
|
$
|
344,970
|
|
(Amounts in thousands)
|
|
Average
Amortization Period |
|
|
|
Accumulated
|
|
Net Carrying
|
||||||
|
|
(in Years)
|
|
Cost
|
|
Amortization
|
|
Value
|
||||||
As of September 27, 2014
|
|
|
|
|
|
|
|
|
||||||
Patents
|
|
14
|
|
$
|
12,770
|
|
|
$
|
(9,958
|
)
|
|
$
|
2,812
|
|
Trademarks/Tradenames
|
|
11
|
|
117,660
|
|
|
(69,304
|
)
|
|
48,356
|
|
|||
Customer relationships
|
|
13
|
|
221,155
|
|
|
(118,962
|
)
|
|
102,193
|
|
|||
Other
|
|
5
|
|
4,390
|
|
|
(2,745
|
)
|
|
1,645
|
|
|||
Total intangible assets
|
|
12
|
|
$
|
355,975
|
|
|
$
|
(200,969
|
)
|
|
$
|
155,006
|
|
|
|
|
|
|
|
|
|
|
||||||
As of December 31, 2013:
|
|
|
|
|
|
|
|
|
|
|
|
|||
Patents
|
|
14
|
|
$
|
12,770
|
|
|
$
|
(9,250
|
)
|
|
$
|
3,520
|
|
Trademarks/Tradenames
|
|
10
|
|
91,884
|
|
|
(65,801
|
)
|
|
26,083
|
|
|||
Customer relationships
|
|
12
|
|
187,055
|
|
|
(107,721
|
)
|
|
79,334
|
|
|||
Other
|
|
5
|
|
3,427
|
|
|
(2,352
|
)
|
|
1,075
|
|
|||
Total intangible assets
|
|
12
|
|
$
|
295,136
|
|
|
$
|
(185,124
|
)
|
|
$
|
110,012
|
|
|
Amortization
|
||
(Amounts in thousands)
|
expense
|
||
|
|
||
2014 (remainder of year)
|
$
|
5,723
|
|
2015
|
25,051
|
|
|
2016
|
24,374
|
|
|
2017
|
20,511
|
|
|
2018
|
19,731
|
|
(Amounts in thousands)
|
|
For the three months ended
|
|
For the nine months ended
|
||||||||||||
|
|
September 27, 2014
|
|
September 28, 2013
|
|
September 27, 2014
|
|
September 28, 2013
|
||||||||
Net income (loss)
|
|
$
|
21,405
|
|
|
$
|
16,895
|
|
|
$
|
(18,793
|
)
|
|
$
|
(62,089
|
)
|
Foreign currency translation adjustment
|
|
(5,009
|
)
|
|
4,074
|
|
|
(5,366
|
)
|
|
1,091
|
|
||||
Unrealized gain (loss) on derivative instrument
|
|
886
|
|
|
—
|
|
|
(47
|
)
|
|
—
|
|
||||
Comprehensive income (loss)
|
|
$
|
17,282
|
|
|
$
|
20,969
|
|
|
$
|
(24,206
|
)
|
|
$
|
(60,998
|
)
|
(Amounts in thousands)
|
|
|
|
|
||||
|
|
September 27, 2014
|
|
December 31, 2013
|
||||
Senior secured asset based revolving credit facility
|
|
$
|
20,000
|
|
|
$
|
—
|
|
Term Loan due 2021, net of unamortized early tender premium
|
|
|
|
|
||||
and discount of $33,658 and $0, respectively
|
|
395,267
|
|
|
—
|
|
||
6.50% Senior notes due 2022, net of unamortized early tender premium
|
|
|
|
|
||||
and discount of $52,442 and $0, respectively
|
|
597,558
|
|
|
—
|
|
||
8.25% Senior secured notes due 2018, net of unamortized early
|
|
|
|
|
|
|
||
tender premium and discount of $0 and $30,426, respectively
|
|
—
|
|
|
725,574
|
|
||
9.375% Senior notes due 2017, net of unamortized
|
|
|
|
|
||||
discount of $0 and $4,546, respectively
|
|
—
|
|
|
91,454
|
|
||
|
|
$
|
1,012,825
|
|
|
$
|
817,028
|
|
Less current portion of long-term debt
|
|
(4,300
|
)
|
|
—
|
|
||
|
|
$
|
1,008,525
|
|
|
$
|
817,028
|
|
(Amounts in thousands)
|
|
For the nine months ended
|
||||||
|
|
September 27, 2014
|
|
September 28, 2013
|
||||
Loss on extinguishment of debt:
|
|
|
|
|
|
|
||
Tender premium
|
|
$
|
(8,493
|
)
|
|
$
|
—
|
|
8.25% Senior Secured Notes and 9.375% Senior Notes unamortized discount
|
|
(4,773
|
)
|
|
—
|
|
||
8.25% Senior Secured Notes and 9.375% Senior Notes unamortized debt issuance costs
|
|
(2,067
|
)
|
|
—
|
|
||
Term Loan Facility unamortized discount
|
|
(255
|
)
|
|
—
|
|
||
Call premium for 8.25% Senior Secured Notes
|
|
—
|
|
|
(2,520
|
)
|
||
8.25% Senior Secured Notes unamortized discount
|
|
—
|
|
|
(3,831
|
)
|
||
8.25% Senior Secured Notes unamortized debt issuance costs
|
|
—
|
|
|
(1,766
|
)
|
||
Call premium for 9.375% Senior Notes
|
|
—
|
|
|
(6,000
|
)
|
||
9.375% Senior Notes unamortized discount
|
|
—
|
|
|
(3,666
|
)
|
||
9.375% Senior Notes unamortized debt issuance costs
|
|
—
|
|
|
(1,165
|
)
|
||
|
|
(15,588
|
)
|
|
(18,948
|
)
|
||
Loss on modification of debt:
|
|
|
|
|
||||
Third party fees for 8.25% Senior Secured Notes and 9.375% Senior Notes
|
|
(302
|
)
|
|
—
|
|
||
Third party fees for 6.50% Senior Notes and Term Loan Facility
|
|
(5,474
|
)
|
|
—
|
|
||
|
|
(5,776
|
)
|
|
—
|
|
||
|
|
|
|
|
||||
Total loss on modification or extinguishment of debt
|
|
$
|
(21,364
|
)
|
|
$
|
(18,948
|
)
|
(Amounts in thousands)
|
|
For the three months ended
|
|
For the nine months ended
|
||||||||||||
|
|
September 27, 2014
|
|
September 28, 2013
|
|
September 27, 2014
|
|
September 28, 2013
|
||||||||
Service cost
|
|
$
|
—
|
|
|
$
|
29
|
|
|
$
|
—
|
|
|
$
|
87
|
|
Interest cost
|
|
476
|
|
|
440
|
|
|
1,427
|
|
|
1,320
|
|
||||
Expected return on plan assets
|
|
(567
|
)
|
|
(513
|
)
|
|
(1,702
|
)
|
|
(1,539
|
)
|
||||
Amortization of loss
|
|
116
|
|
|
234
|
|
|
347
|
|
|
702
|
|
||||
Net periodic benefit expense
|
|
$
|
25
|
|
|
$
|
190
|
|
|
$
|
72
|
|
|
$
|
570
|
|
(Amounts in thousands)
|
|
September 27, 2014
|
|
December 31, 2013
|
||||
Product claim liabilities
|
|
$
|
140
|
|
|
$
|
140
|
|
Multi-employer pension plan withdrawal liability
|
|
2,251
|
|
|
2,362
|
|
||
Other
|
|
647
|
|
|
576
|
|
||
|
|
$
|
3,038
|
|
|
$
|
3,078
|
|
|
|
For the three months ended
|
|
For the nine months ended
|
||||||||||||
(Amounts in thousands)
|
|
September 27, 2014
|
|
September 28, 2013
|
|
September 27, 2014
|
|
September 28, 2013
|
||||||||
Balance, beginning of period
|
|
$
|
40,397
|
|
|
$
|
40,554
|
|
|
$
|
42,466
|
|
|
$
|
37,870
|
|
Acquisitions - Simonton, Gienow, and Mitten
|
|
5,370
|
|
|
—
|
|
|
5,370
|
|
|
4,675
|
|
||||
Warranty expense during period
|
|
2,897
|
|
|
3,827
|
|
|
8,209
|
|
|
8,197
|
|
||||
Settlements made during period
|
|
(5,148
|
)
|
|
(4,012
|
)
|
|
(12,529
|
)
|
|
(10,373
|
)
|
||||
Balance, end of period
|
|
$
|
43,516
|
|
|
$
|
40,369
|
|
|
$
|
43,516
|
|
|
$
|
40,369
|
|
(Amounts in thousands)
|
|
September 27, 2014
|
|
December 31, 2013
|
||||
Insurance
|
|
$
|
9,292
|
|
|
$
|
3,926
|
|
Employee compensation and benefits
|
|
17,445
|
|
|
8,916
|
|
||
Sales and marketing
|
|
42,989
|
|
|
34,215
|
|
||
Product warranty
|
|
11,387
|
|
|
10,861
|
|
||
Accrued freight
|
|
2,701
|
|
|
1,350
|
|
||
Accrued interest
|
|
9,813
|
|
|
25,477
|
|
||
Accrued environmental liability
|
|
456
|
|
|
463
|
|
||
Accrued pension
|
|
2,258
|
|
|
2,258
|
|
||
Accrued sales returns and discounts
|
|
4,063
|
|
|
3,263
|
|
||
Accrued taxes
|
|
4,418
|
|
|
3,433
|
|
||
Litigation accrual
|
|
2,594
|
|
|
—
|
|
||
Other
|
|
40,141
|
|
|
18,778
|
|
||
|
|
$
|
147,557
|
|
|
$
|
112,940
|
|
(Amounts in thousands)
|
|
September 27, 2014
|
|
December 31, 2013
|
||||
Insurance
|
|
$
|
2,043
|
|
|
$
|
2,213
|
|
Pension liabilities
|
|
5,176
|
|
|
6,622
|
|
||
Multi-employer pension withdrawal liability
|
|
2,251
|
|
|
2,362
|
|
||
Product warranty
|
|
32,129
|
|
|
31,605
|
|
||
Long-term product claim liability
|
|
140
|
|
|
140
|
|
||
Long-term environmental liability
|
|
1,227
|
|
|
1,247
|
|
||
Liabilities for tax uncertainties
|
|
3,188
|
|
|
2,934
|
|
||
Litigation accrual
|
|
2,000
|
|
|
—
|
|
||
Other
|
|
4,244
|
|
|
5,437
|
|
||
|
|
$
|
52,398
|
|
|
$
|
52,560
|
|
|
|
Stock Options
|
|
Weighted-
Average Exercise Price |
|
Weighted-
Average Remaining Contractual Term (Years) |
||||
Balance at January 1, 2014
|
|
3,285,750
|
|
|
$
|
11.04
|
|
|
5.24
|
|
Granted
|
|
151,147
|
|
|
15.11
|
|
|
—
|
|
|
Exercised
|
|
(618,615
|
)
|
|
1.76
|
|
|
—
|
|
|
Forfeited or expired
|
|
(105,494
|
)
|
|
10.85
|
|
|
—
|
|
|
Balance at September 27, 2014
|
|
2,712,788
|
|
|
$
|
13.39
|
|
|
5.71
|
|
|
|
For the three months ended
|
|
For the nine months ended
|
||||||||||||
(Amounts in thousands)
|
|
September 27, 2014
|
|
September 28, 2013
|
|
September 27, 2014
|
|
September 28, 2013
|
||||||||
Net sales
|
|
|
|
|
|
|
|
|
||||||||
Siding, Fencing and Stone
|
|
$
|
244,416
|
|
|
$
|
228,214
|
|
|
$
|
609,419
|
|
|
$
|
565,010
|
|
Windows and Doors
|
|
193,432
|
|
|
179,212
|
|
|
507,105
|
|
|
467,653
|
|
||||
|
|
$
|
437,848
|
|
|
$
|
407,426
|
|
|
$
|
1,116,524
|
|
|
$
|
1,032,663
|
|
Operating earnings (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Siding, Fencing and Stone
|
|
$
|
44,756
|
|
|
$
|
39,476
|
|
|
$
|
89,484
|
|
|
$
|
92,998
|
|
Windows and Doors
|
|
3,773
|
|
|
(4,489
|
)
|
|
(17,793
|
)
|
|
(22,549
|
)
|
||||
Unallocated
|
|
(6,602
|
)
|
|
(4,067
|
)
|
|
(18,116
|
)
|
|
(39,439
|
)
|
||||
|
|
$
|
41,927
|
|
|
$
|
30,920
|
|
|
$
|
53,575
|
|
|
$
|
31,010
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Total assets as of
|
|
|
|
|
||||||||||
|
|
September 27, 2014
|
|
December 31, 2013
|
|
|
|
|
||||||||
Total assets
|
|
|
|
|
|
|
|
|
|
|
||||||
Siding, Fencing and Stone
|
|
$
|
722,440
|
|
|
$
|
655,252
|
|
|
|
|
|
||||
Windows and Doors
|
|
540,793
|
|
|
305,789
|
|
|
|
|
|
||||||
Unallocated
|
|
41,629
|
|
|
81,210
|
|
|
|
|
|
||||||
|
|
$
|
1,304,862
|
|
|
$
|
1,042,251
|
|
|
|
|
|
(Amounts in thousands)
|
|
Accrued as of
|
|
Adjustments
|
|
Expensed
|
|
Cash payments
|
|
Accrued as of
|
||||||||||
|
|
December 31, 2013
|
|
during 2014
|
|
during 2014
|
|
during 2014
|
|
September 27, 2014
|
||||||||||
Western Canada
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Severance costs
|
|
$
|
603
|
|
|
$
|
(80
|
)
|
|
$
|
49
|
|
|
$
|
(485
|
)
|
|
$
|
87
|
|
Contract terminations
|
|
157
|
|
|
(24
|
)
|
|
—
|
|
|
—
|
|
|
133
|
|
|||||
Equipment removal and other
|
|
533
|
|
|
(69
|
)
|
|
2,963
|
|
|
(3,350
|
)
|
|
77
|
|
|||||
|
|
$
|
1,293
|
|
|
$
|
(173
|
)
|
|
$
|
3,012
|
|
|
$
|
(3,835
|
)
|
|
$
|
297
|
|
|
|
For the three months ended
|
|
For the nine months ended
|
||||||||||||
(Amounts in thousands)
|
|
September 27, 2014
|
|
September 28, 2013
|
|
September 27, 2014
|
|
September 28, 2013
|
||||||||
Siding, Fencing and Stone
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Windows and Doors
|
|
819
|
|
|
—
|
|
|
3,012
|
|
|
—
|
|
||||
|
|
$
|
819
|
|
|
$
|
—
|
|
|
$
|
3,012
|
|
|
$
|
—
|
|
PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
|
||||||||||||||||||||||||
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
|
||||||||||||||||||||||||
For the three months ended September 27, 2014
|
||||||||||||||||||||||||
|
|
Guarantor
|
|
Issuer
|
|
|
|
Non-
|
|
|
|
|
||||||||||||
|
|
Ply Gem
|
|
Ply Gem
|
|
Guarantor
|
|
Guarantor
|
|
Consolidating
|
|
|
||||||||||||
(Amounts in thousands)
|
|
Holdings, Inc.
|
|
Industries, Inc.
|
|
Subsidiaries
|
|
Subsidiaries
|
|
Adjustments
|
|
Consolidated
|
||||||||||||
Net sales
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
352,856
|
|
|
$
|
84,992
|
|
|
$
|
—
|
|
|
$
|
437,848
|
|
Cost of products sold
|
|
—
|
|
|
—
|
|
|
275,938
|
|
|
63,321
|
|
|
—
|
|
|
339,259
|
|
||||||
Gross profit
|
|
—
|
|
|
—
|
|
|
76,918
|
|
|
21,671
|
|
|
—
|
|
|
98,589
|
|
||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Selling, general and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
administrative expenses
|
|
—
|
|
|
6,602
|
|
|
28,502
|
|
|
16,251
|
|
|
—
|
|
|
51,355
|
|
||||||
Intercompany administrative
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
charges
|
|
—
|
|
|
—
|
|
|
4,528
|
|
|
1,047
|
|
|
(5,575
|
)
|
|
—
|
|
||||||
Amortization of intangible assets
|
|
—
|
|
|
—
|
|
|
4,008
|
|
|
1,299
|
|
|
—
|
|
|
5,307
|
|
||||||
Total operating expenses
|
|
—
|
|
|
6,602
|
|
|
37,038
|
|
|
18,597
|
|
|
(5,575
|
)
|
|
56,662
|
|
||||||
Operating earnings (loss)
|
|
—
|
|
|
(6,602
|
)
|
|
39,880
|
|
|
3,074
|
|
|
5,575
|
|
|
41,927
|
|
||||||
Foreign currency loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(766
|
)
|
|
—
|
|
|
(766
|
)
|
||||||
Intercompany interest
|
|
—
|
|
|
13,328
|
|
|
(11,723
|
)
|
|
(1,605
|
)
|
|
—
|
|
|
—
|
|
||||||
Interest expense
|
|
—
|
|
|
(16,296
|
)
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
(16,300
|
)
|
||||||
Interest income
|
|
—
|
|
|
1
|
|
|
4
|
|
|
13
|
|
|
—
|
|
|
18
|
|
||||||
Tax receivable agreement liability adjustment
|
|
—
|
|
|
(13,988
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(13,988
|
)
|
||||||
Intercompany administrative income
|
|
—
|
|
|
5,575
|
|
|
—
|
|
|
—
|
|
|
(5,575
|
)
|
|
—
|
|
||||||
Income (loss) before equity in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
subsidiaries' income
|
|
—
|
|
|
(17,982
|
)
|
|
28,157
|
|
|
716
|
|
|
—
|
|
|
10,891
|
|
||||||
Equity in subsidiaries' income
|
|
21,405
|
|
|
39,387
|
|
|
—
|
|
|
—
|
|
|
(60,792
|
)
|
|
—
|
|
||||||
Income before provision
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
(benefit) for income taxes
|
|
21,405
|
|
|
21,405
|
|
|
28,157
|
|
|
716
|
|
|
(60,792
|
)
|
|
10,891
|
|
||||||
Provision (benefit) for income taxes
|
|
—
|
|
|
—
|
|
|
(11,159
|
)
|
|
645
|
|
|
—
|
|
|
(10,514
|
)
|
||||||
Net income
|
|
$
|
21,405
|
|
|
$
|
21,405
|
|
|
$
|
39,316
|
|
|
$
|
71
|
|
|
$
|
(60,792
|
)
|
|
$
|
21,405
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,009
|
)
|
|
—
|
|
|
(5,009
|
)
|
||||||
Unrealized gain on derivative instrument
|
|
—
|
|
|
—
|
|
|
—
|
|
|
886
|
|
|
—
|
|
|
886
|
|
||||||
Total comprehensive income (loss)
|
|
$
|
21,405
|
|
|
$
|
21,405
|
|
|
$
|
39,316
|
|
|
$
|
(4,052
|
)
|
|
$
|
(60,792
|
)
|
|
$
|
17,282
|
|
PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
|
||||||||||||||||||||||||
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
|
||||||||||||||||||||||||
For the three months ended September 28, 2013
|
||||||||||||||||||||||||
|
|
Guarantor
|
|
Issuer
|
|
|
|
Non-
|
|
|
|
|
||||||||||||
|
|
Ply Gem
|
|
Ply Gem
|
|
Guarantor
|
|
Guarantor
|
|
Consolidating
|
|
|
||||||||||||
(Amounts in thousands)
|
|
Holdings, Inc.
|
|
Industries, Inc.
|
|
Subsidiaries
|
|
Subsidiary
|
|
Adjustments
|
|
Consolidated
|
||||||||||||
Net sales
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
316,548
|
|
|
$
|
90,878
|
|
|
$
|
—
|
|
|
$
|
407,426
|
|
Cost of products sold
|
|
—
|
|
|
—
|
|
|
256,912
|
|
|
66,346
|
|
|
—
|
|
|
323,258
|
|
||||||
Gross profit
|
|
—
|
|
|
—
|
|
|
59,636
|
|
|
24,532
|
|
|
—
|
|
|
84,168
|
|
||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Selling, general and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
administrative expenses
|
|
—
|
|
|
4,067
|
|
|
26,780
|
|
|
16,750
|
|
|
—
|
|
|
47,597
|
|
||||||
Intercompany administrative
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
charges
|
|
—
|
|
|
—
|
|
|
4,235
|
|
|
1,941
|
|
|
(6,176
|
)
|
|
—
|
|
||||||
Amortization of intangible assets
|
|
—
|
|
|
—
|
|
|
4,221
|
|
|
1,430
|
|
|
—
|
|
|
5,651
|
|
||||||
Total operating expenses
|
|
—
|
|
|
4,067
|
|
|
35,236
|
|
|
20,121
|
|
|
(6,176
|
)
|
|
53,248
|
|
||||||
Operating earnings (loss)
|
|
—
|
|
|
(4,067
|
)
|
|
24,400
|
|
|
4,411
|
|
|
6,176
|
|
|
30,920
|
|
||||||
Foreign currency loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(376
|
)
|
|
—
|
|
|
(376
|
)
|
||||||
Intercompany interest
|
|
—
|
|
|
17,842
|
|
|
(17,509
|
)
|
|
(333
|
)
|
|
—
|
|
|
—
|
|
||||||
Interest expense
|
|
—
|
|
|
(22,070
|
)
|
|
(9
|
)
|
|
34
|
|
|
—
|
|
|
(22,045
|
)
|
||||||
Interest income
|
|
—
|
|
|
1
|
|
|
165
|
|
|
119
|
|
|
—
|
|
|
285
|
|
||||||
Tax receivable agreement liability adjustment
|
|
—
|
|
|
6,669
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,669
|
|
||||||
Intercompany administrative income
|
|
—
|
|
|
6,176
|
|
|
—
|
|
|
—
|
|
|
(6,176
|
)
|
|
—
|
|
||||||
Income before equity in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
subsidiaries' income
|
|
—
|
|
|
4,551
|
|
|
7,047
|
|
|
3,855
|
|
|
—
|
|
|
15,453
|
|
||||||
Equity in subsidiaries' income
|
|
16,895
|
|
|
12,344
|
|
|
—
|
|
|
—
|
|
|
(29,239
|
)
|
|
—
|
|
||||||
Income before provision (benefit)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
for income taxes
|
|
16,895
|
|
|
16,895
|
|
|
7,047
|
|
|
3,855
|
|
|
(29,239
|
)
|
|
15,453
|
|
||||||
Provision (benefit) for income taxes
|
|
—
|
|
|
—
|
|
|
(2,124
|
)
|
|
682
|
|
|
—
|
|
|
(1,442
|
)
|
||||||
Net income
|
|
$
|
16,895
|
|
|
$
|
16,895
|
|
|
$
|
9,171
|
|
|
$
|
3,173
|
|
|
$
|
(29,239
|
)
|
|
$
|
16,895
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,074
|
|
|
—
|
|
|
4,074
|
|
||||||
Total comprehensive income
|
|
$
|
16,895
|
|
|
$
|
16,895
|
|
|
$
|
9,171
|
|
|
$
|
7,247
|
|
|
$
|
(29,239
|
)
|
|
$
|
20,969
|
|
PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
|
||||||||||||||||||||||||
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
|
||||||||||||||||||||||||
For the nine months ended September 27, 2014
|
||||||||||||||||||||||||
|
|
Guarantor
|
|
Issuer
|
|
|
|
Non-
|
|
|
|
|
||||||||||||
|
|
Ply Gem
|
|
Ply Gem
|
|
Guarantor
|
|
Guarantor
|
|
Consolidating
|
|
|
||||||||||||
(Amounts in thousands)
|
|
Holdings, Inc.
|
|
Industries, Inc.
|
|
Subsidiaries
|
|
Subsidiaries
|
|
Adjustments
|
|
Consolidated
|
||||||||||||
Net sales
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
905,393
|
|
|
$
|
211,131
|
|
|
$
|
—
|
|
|
$
|
1,116,524
|
|
Cost of products sold
|
|
—
|
|
|
—
|
|
|
728,675
|
|
|
162,042
|
|
|
—
|
|
|
890,717
|
|
||||||
Gross profit
|
|
—
|
|
|
—
|
|
|
176,718
|
|
|
49,089
|
|
|
—
|
|
|
225,807
|
|
||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Selling, general and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
administrative expenses
|
|
—
|
|
|
18,116
|
|
|
90,553
|
|
|
47,722
|
|
|
—
|
|
|
156,391
|
|
||||||
Intercompany administrative
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
charges
|
|
—
|
|
|
—
|
|
|
12,774
|
|
|
4,567
|
|
|
(17,341
|
)
|
|
—
|
|
||||||
Amortization of intangible assets
|
|
—
|
|
|
—
|
|
|
11,793
|
|
|
4,048
|
|
|
—
|
|
|
15,841
|
|
||||||
Total operating expenses
|
|
—
|
|
|
18,116
|
|
|
115,120
|
|
|
56,337
|
|
|
(17,341
|
)
|
|
172,232
|
|
||||||
Operating earnings (loss)
|
|
—
|
|
|
(18,116
|
)
|
|
61,598
|
|
|
(7,248
|
)
|
|
17,341
|
|
|
53,575
|
|
||||||
Foreign currency loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(517
|
)
|
|
—
|
|
|
(517
|
)
|
||||||
Intercompany interest
|
|
—
|
|
|
45,352
|
|
|
(42,753
|
)
|
|
(2,599
|
)
|
|
—
|
|
|
—
|
|
||||||
Interest expense
|
|
—
|
|
|
(52,033
|
)
|
|
(30
|
)
|
|
(2
|
)
|
|
—
|
|
|
(52,065
|
)
|
||||||
Interest income
|
|
—
|
|
|
4
|
|
|
24
|
|
|
36
|
|
|
—
|
|
|
64
|
|
||||||
Tax receivable agreement liability adjustment
|
|
—
|
|
|
(14,419
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(14,419
|
)
|
||||||
Loss on modification or
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
extinguishment of debt
|
|
—
|
|
|
(21,364
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(21,364
|
)
|
||||||
Intercompany administrative income
|
|
—
|
|
|
17,341
|
|
|
—
|
|
|
—
|
|
|
(17,341
|
)
|
|
—
|
|
||||||
Income (loss) before equity in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
subsidiaries' loss
|
|
—
|
|
|
(43,235
|
)
|
|
18,839
|
|
|
(10,330
|
)
|
|
—
|
|
|
(34,726
|
)
|
||||||
Equity in subsidiaries' income (loss)
|
|
(18,793
|
)
|
|
24,442
|
|
|
—
|
|
|
—
|
|
|
(5,649
|
)
|
|
—
|
|
||||||
Income (loss) before provision
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
(benefit) for income taxes
|
|
(18,793
|
)
|
|
(18,793
|
)
|
|
18,839
|
|
|
(10,330
|
)
|
|
(5,649
|
)
|
|
(34,726
|
)
|
||||||
Provision (benefit) for income taxes
|
|
—
|
|
|
—
|
|
|
(21,134
|
)
|
|
5,201
|
|
|
—
|
|
|
(15,933
|
)
|
||||||
Net income (loss)
|
|
$
|
(18,793
|
)
|
|
$
|
(18,793
|
)
|
|
$
|
39,973
|
|
|
$
|
(15,531
|
)
|
|
$
|
(5,649
|
)
|
|
$
|
(18,793
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,366
|
)
|
|
—
|
|
|
(5,366
|
)
|
||||||
Unrealized loss on derivative instrument
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(47
|
)
|
|
—
|
|
|
(47
|
)
|
||||||
Total comprehensive income (loss)
|
|
$
|
(18,793
|
)
|
|
$
|
(18,793
|
)
|
|
$
|
39,973
|
|
|
$
|
(20,944
|
)
|
|
$
|
(5,649
|
)
|
|
$
|
(24,206
|
)
|
PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
|
||||||||||||||||||||||||
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
|
||||||||||||||||||||||||
For the nine months ended September 28, 2013
|
||||||||||||||||||||||||
|
|
Guarantor
|
|
Issuer
|
|
|
|
Non-
|
|
|
|
|
||||||||||||
|
|
Ply Gem
|
|
Ply Gem
|
|
Guarantor
|
|
Guarantor
|
|
Consolidating
|
|
|
||||||||||||
(Amounts in thousands)
|
|
Holdings, Inc.
|
|
Industries, Inc.
|
|
Subsidiaries
|
|
Subsidiary
|
|
Adjustments
|
|
Consolidated
|
||||||||||||
Net sales
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
872,528
|
|
|
$
|
160,135
|
|
|
$
|
—
|
|
|
$
|
1,032,663
|
|
Cost of products sold
|
|
—
|
|
|
—
|
|
|
713,064
|
|
|
119,325
|
|
|
—
|
|
|
832,389
|
|
||||||
Gross profit
|
|
—
|
|
|
—
|
|
|
159,464
|
|
|
40,810
|
|
|
—
|
|
|
200,274
|
|
||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Selling, general and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
administrative expenses
|
|
—
|
|
|
15,912
|
|
|
83,032
|
|
|
32,218
|
|
|
—
|
|
|
131,162
|
|
||||||
Intercompany administrative
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
charges
|
|
—
|
|
|
—
|
|
|
15,134
|
|
|
5,047
|
|
|
(20,181
|
)
|
|
—
|
|
||||||
Amortization of intangible assets
|
|
—
|
|
|
—
|
|
|
12,629
|
|
|
1,946
|
|
|
—
|
|
|
14,575
|
|
||||||
Initial public offering costs
|
|
—
|
|
|
23,527
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23,527
|
|
||||||
Total operating expenses
|
|
—
|
|
|
39,439
|
|
|
110,795
|
|
|
39,211
|
|
|
(20,181
|
)
|
|
169,264
|
|
||||||
Operating earnings (loss)
|
|
—
|
|
|
(39,439
|
)
|
|
48,669
|
|
|
1,599
|
|
|
20,181
|
|
|
31,010
|
|
||||||
Foreign currency loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(755
|
)
|
|
—
|
|
|
(755
|
)
|
||||||
Intercompany interest
|
|
—
|
|
|
59,992
|
|
|
(59,238
|
)
|
|
(754
|
)
|
|
—
|
|
|
—
|
|
||||||
Interest expense
|
|
—
|
|
|
(70,583
|
)
|
|
(28
|
)
|
|
6
|
|
|
—
|
|
|
(70,605
|
)
|
||||||
Interest income
|
|
—
|
|
|
6
|
|
|
181
|
|
|
172
|
|
|
—
|
|
|
359
|
|
||||||
Tax receivable agreement liability adjustment
|
|
—
|
|
|
(1,474
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,474
|
)
|
||||||
Loss on modification or
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
extinguishment of debt
|
|
—
|
|
|
(18,948
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(18,948
|
)
|
||||||
Intercompany administrative income
|
|
—
|
|
|
20,181
|
|
|
—
|
|
|
—
|
|
|
(20,181
|
)
|
|
—
|
|
||||||
Income (loss) before equity in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
subsidiaries' loss
|
|
—
|
|
|
(50,265
|
)
|
|
(10,416
|
)
|
|
268
|
|
|
—
|
|
|
(60,413
|
)
|
||||||
Equity in subsidiaries' income (loss)
|
|
(62,089
|
)
|
|
(11,824
|
)
|
|
—
|
|
|
—
|
|
|
73,913
|
|
|
—
|
|
||||||
Income (loss) before provision (benefit)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
for income taxes
|
|
(62,089
|
)
|
|
(62,089
|
)
|
|
(10,416
|
)
|
|
268
|
|
|
73,913
|
|
|
(60,413
|
)
|
||||||
Provision (benefit) for income taxes
|
|
—
|
|
|
—
|
|
|
1,866
|
|
|
(190
|
)
|
|
—
|
|
|
1,676
|
|
||||||
Net income (loss)
|
|
$
|
(62,089
|
)
|
|
$
|
(62,089
|
)
|
|
$
|
(12,282
|
)
|
|
$
|
458
|
|
|
$
|
73,913
|
|
|
$
|
(62,089
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,091
|
|
|
—
|
|
|
1,091
|
|
||||||
Total comprehensive income (loss)
|
|
$
|
(62,089
|
)
|
|
$
|
(62,089
|
)
|
|
$
|
(12,282
|
)
|
|
$
|
1,549
|
|
|
$
|
73,913
|
|
|
$
|
(60,998
|
)
|
PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
|
||||||||||||||||||||||||
CONDENSED CONSOLIDATING BALANCE SHEET
|
||||||||||||||||||||||||
As of September 27, 2014
|
||||||||||||||||||||||||
(Amounts in thousands)
|
|
Guarantor
|
|
Issuer
|
|
|
|
Non-
|
|
|
|
|
||||||||||||
|
|
Ply Gem
|
|
Ply Gem
|
|
Guarantor
|
|
Guarantor
|
|
Consolidating
|
|
|
||||||||||||
ASSETS
|
|
Holdings, Inc.
|
|
Industries, Inc.
|
|
Subsidiaries
|
|
Subsidiaries
|
|
Adjustments
|
|
Consolidated
|
||||||||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash and cash equivalents
|
|
$
|
—
|
|
|
$
|
12,151
|
|
|
$
|
(3,427
|
)
|
|
$
|
18,058
|
|
|
$
|
—
|
|
|
$
|
26,782
|
|
Accounts receivable, net
|
|
—
|
|
|
—
|
|
|
229,183
|
|
|
48,955
|
|
|
—
|
|
|
278,138
|
|
||||||
Inventories:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Raw materials
|
|
—
|
|
|
—
|
|
|
62,437
|
|
|
13,421
|
|
|
—
|
|
|
75,858
|
|
||||||
Work in process
|
|
—
|
|
|
—
|
|
|
27,018
|
|
|
1,341
|
|
|
—
|
|
|
28,359
|
|
||||||
Finished goods
|
|
—
|
|
|
—
|
|
|
52,699
|
|
|
18,791
|
|
|
—
|
|
|
71,490
|
|
||||||
Total inventory
|
|
—
|
|
|
—
|
|
|
142,154
|
|
|
33,553
|
|
|
—
|
|
|
175,707
|
|
||||||
Prepaid expenses and other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
current assets
|
|
—
|
|
|
461
|
|
|
15,494
|
|
|
4,547
|
|
|
—
|
|
|
20,502
|
|
||||||
Deferred income taxes
|
|
—
|
|
|
—
|
|
|
6,554
|
|
|
—
|
|
|
—
|
|
|
6,554
|
|
||||||
Total current assets
|
|
—
|
|
|
12,612
|
|
|
389,958
|
|
|
105,113
|
|
|
—
|
|
|
507,683
|
|
||||||
Investments in subsidiaries
|
|
(73,456
|
)
|
|
(8,108
|
)
|
|
—
|
|
|
—
|
|
|
81,564
|
|
|
—
|
|
||||||
Property and Equipment, at cost:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Land
|
|
—
|
|
|
—
|
|
|
7,100
|
|
|
917
|
|
|
—
|
|
|
8,017
|
|
||||||
Buildings and improvements
|
|
—
|
|
|
—
|
|
|
60,030
|
|
|
5,640
|
|
|
—
|
|
|
65,670
|
|
||||||
Machinery and equipment
|
|
—
|
|
|
2,701
|
|
|
341,481
|
|
|
16,593
|
|
|
—
|
|
|
360,775
|
|
||||||
|
|
—
|
|
|
2,701
|
|
|
408,611
|
|
|
23,150
|
|
|
—
|
|
|
434,462
|
|
||||||
Less accumulated depreciation
|
|
—
|
|
|
(1,967
|
)
|
|
(264,168
|
)
|
|
(7,758
|
)
|
|
—
|
|
|
(273,893
|
)
|
||||||
Total property and equipment, net
|
|
—
|
|
|
734
|
|
|
144,443
|
|
|
15,392
|
|
|
—
|
|
|
160,569
|
|
||||||
Other Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Intangible assets, net
|
|
—
|
|
|
—
|
|
|
128,345
|
|
|
26,661
|
|
|
—
|
|
|
155,006
|
|
||||||
Goodwill
|
|
—
|
|
|
—
|
|
|
415,386
|
|
|
35,232
|
|
|
—
|
|
|
450,618
|
|
||||||
Intercompany note receivable
|
|
—
|
|
|
953,510
|
|
|
—
|
|
|
—
|
|
|
(953,510
|
)
|
|
—
|
|
||||||
Other
|
|
—
|
|
|
28,283
|
|
|
2,703
|
|
|
—
|
|
|
—
|
|
|
30,986
|
|
||||||
Total other assets
|
|
—
|
|
|
981,793
|
|
|
546,434
|
|
|
61,893
|
|
|
(953,510
|
)
|
|
636,610
|
|
||||||
|
|
$
|
(73,456
|
)
|
|
$
|
987,031
|
|
|
$
|
1,080,835
|
|
|
$
|
182,398
|
|
|
$
|
(871,946
|
)
|
|
$
|
1,304,862
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
|
||||||||||||||||||||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Accounts payable
|
|
$
|
—
|
|
|
$
|
541
|
|
|
$
|
91,518
|
|
|
$
|
24,917
|
|
|
$
|
—
|
|
|
$
|
116,976
|
|
Accrued expenses
|
|
—
|
|
|
15,756
|
|
|
106,557
|
|
|
25,244
|
|
|
—
|
|
|
147,557
|
|
||||||
Current portion of long-term debt
|
|
—
|
|
|
4,300
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,300
|
|
||||||
Total current liabilities
|
|
—
|
|
|
20,597
|
|
|
198,075
|
|
|
50,161
|
|
|
—
|
|
|
268,833
|
|
||||||
Deferred income taxes
|
|
—
|
|
|
—
|
|
|
14,784
|
|
|
7,736
|
|
|
—
|
|
|
22,520
|
|
||||||
Intercompany note payable
|
|
—
|
|
|
—
|
|
|
842,051
|
|
|
111,459
|
|
|
(953,510
|
)
|
|
—
|
|
||||||
Payable to related parties pursuant to
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
tax receivable agreement
|
|
—
|
|
|
26,042
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
26,042
|
|
||||||
Other long-term liabilities
|
|
—
|
|
|
5,323
|
|
|
42,880
|
|
|
4,195
|
|
|
—
|
|
|
52,398
|
|
||||||
Long-term debt, less current portion
|
|
—
|
|
|
1,008,525
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,008,525
|
|
||||||
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Stockholders' Equity (Deficit):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Preferred stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Common stock
|
|
678
|
|
|
678
|
|
|
—
|
|
|
—
|
|
|
(678
|
)
|
|
678
|
|
||||||
Additional paid-in-capital
|
|
744,529
|
|
|
744,529
|
|
|
622,281
|
|
|
13,581
|
|
|
(1,380,391
|
)
|
|
744,529
|
|
||||||
(Accumulated deficit) retained earnings
|
|
(810,036
|
)
|
|
(810,036
|
)
|
|
(639,236
|
)
|
|
636
|
|
|
1,448,636
|
|
|
(810,036
|
)
|
||||||
Accumulated other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
comprehensive loss
|
|
(8,627
|
)
|
|
(8,627
|
)
|
|
—
|
|
|
(5,370
|
)
|
|
13,997
|
|
|
(8,627
|
)
|
||||||
Total stockholders' (deficit) equity
|
|
(73,456
|
)
|
|
(73,456
|
)
|
|
(16,955
|
)
|
|
8,847
|
|
|
81,564
|
|
|
(73,456
|
)
|
||||||
|
|
$
|
(73,456
|
)
|
|
$
|
987,031
|
|
|
$
|
1,080,835
|
|
|
$
|
182,398
|
|
|
$
|
(871,946
|
)
|
|
$
|
1,304,862
|
|
PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
|
||||||||||||||||||||||||
CONDENSED CONSOLIDATING BALANCE SHEET
|
||||||||||||||||||||||||
As of December 31, 2013
|
||||||||||||||||||||||||
|
|
Guarantor
|
|
Issuer
|
|
|
|
Non-
|
|
|
|
|
||||||||||||
|
|
Ply Gem
|
|
Ply Gem
|
|
Guarantor
|
|
Guarantor
|
|
Consolidating
|
|
|
||||||||||||
(Amounts in thousands)
|
|
Holdings, Inc.
|
|
Industries, Inc.
|
|
Subsidiaries
|
|
Subsidiary
|
|
Adjustments
|
|
Consolidated
|
||||||||||||
ASSETS
|
|
|
||||||||||||||||||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash and cash equivalents
|
|
$
|
—
|
|
|
$
|
57,800
|
|
|
$
|
(4,970
|
)
|
|
$
|
16,971
|
|
|
$
|
—
|
|
|
$
|
69,801
|
|
Accounts receivable, net
|
|
—
|
|
|
—
|
|
|
110,475
|
|
|
29,587
|
|
|
—
|
|
|
140,062
|
|
||||||
Inventories:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Raw materials
|
|
—
|
|
|
—
|
|
|
41,593
|
|
|
9,720
|
|
|
—
|
|
|
51,313
|
|
||||||
Work in process
|
|
—
|
|
|
—
|
|
|
22,781
|
|
|
1,036
|
|
|
—
|
|
|
23,817
|
|
||||||
Finished goods
|
|
—
|
|
|
—
|
|
|
42,751
|
|
|
17,589
|
|
|
—
|
|
|
60,340
|
|
||||||
Total inventory
|
|
—
|
|
|
—
|
|
|
107,125
|
|
|
28,345
|
|
|
—
|
|
|
135,470
|
|
||||||
Prepaid expenses and other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
current assets
|
|
—
|
|
|
613
|
|
|
17,270
|
|
|
5,331
|
|
|
—
|
|
|
23,214
|
|
||||||
Deferred income taxes
|
|
—
|
|
|
—
|
|
|
2,825
|
|
|
353
|
|
|
—
|
|
|
3,178
|
|
||||||
Total current assets
|
|
—
|
|
|
58,413
|
|
|
232,725
|
|
|
80,587
|
|
|
—
|
|
|
371,725
|
|
||||||
Investments in subsidiaries
|
|
(51,996
|
)
|
|
(229,668
|
)
|
|
—
|
|
|
—
|
|
|
281,664
|
|
|
—
|
|
||||||
Property and Equipment, at cost:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Land
|
|
—
|
|
|
—
|
|
|
3,565
|
|
|
963
|
|
|
—
|
|
|
4,528
|
|
||||||
Buildings and improvements
|
|
—
|
|
|
—
|
|
|
38,059
|
|
|
5,632
|
|
|
—
|
|
|
43,691
|
|
||||||
Machinery and equipment
|
|
—
|
|
|
3,275
|
|
|
300,089
|
|
|
18,250
|
|
|
—
|
|
|
321,614
|
|
||||||
|
|
—
|
|
|
3,275
|
|
|
341,713
|
|
|
24,845
|
|
|
—
|
|
|
369,833
|
|
||||||
Less accumulated depreciation
|
|
—
|
|
|
(1,385
|
)
|
|
(249,344
|
)
|
|
(7,457
|
)
|
|
—
|
|
|
(258,186
|
)
|
||||||
Total property and equipment, net
|
|
—
|
|
|
1,890
|
|
|
92,369
|
|
|
17,388
|
|
|
—
|
|
|
111,647
|
|
||||||
Other Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Intangible assets, net
|
|
—
|
|
|
—
|
|
|
77,968
|
|
|
32,044
|
|
|
—
|
|
|
110,012
|
|
||||||
Goodwill
|
|
—
|
|
|
—
|
|
|
383,042
|
|
|
37,186
|
|
|
—
|
|
|
420,228
|
|
||||||
Deferred income taxes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,406
|
|
|
—
|
|
|
5,406
|
|
||||||
Intercompany note receivable
|
|
—
|
|
|
958,631
|
|
|
—
|
|
|
—
|
|
|
(958,631
|
)
|
|
—
|
|
||||||
Other
|
|
—
|
|
|
20,907
|
|
|
2,326
|
|
|
—
|
|
|
—
|
|
|
23,233
|
|
||||||
Total other assets
|
|
—
|
|
|
979,538
|
|
|
463,336
|
|
|
74,636
|
|
|
(958,631
|
)
|
|
558,879
|
|
||||||
|
|
$
|
(51,996
|
)
|
|
$
|
810,173
|
|
|
$
|
788,430
|
|
|
$
|
172,611
|
|
|
$
|
(676,967
|
)
|
|
$
|
1,042,251
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
|
||||||||||||||||||||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Accounts payable
|
|
$
|
—
|
|
|
$
|
601
|
|
|
$
|
66,847
|
|
|
$
|
15,533
|
|
|
$
|
—
|
|
|
$
|
82,981
|
|
Accrued expenses
|
|
—
|
|
|
31,056
|
|
|
62,120
|
|
|
19,764
|
|
|
—
|
|
|
112,940
|
|
||||||
Total current liabilities
|
|
—
|
|
|
31,657
|
|
|
128,967
|
|
|
35,297
|
|
|
—
|
|
|
195,921
|
|
||||||
Deferred income taxes
|
|
—
|
|
|
—
|
|
|
9,005
|
|
|
8,110
|
|
|
—
|
|
|
17,115
|
|
||||||
Intercompany note payable
|
|
—
|
|
|
—
|
|
|
859,768
|
|
|
98,863
|
|
|
(958,631
|
)
|
|
—
|
|
||||||
Payable to related parties pursuant to
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
tax receivable agreement
|
|
—
|
|
|
11,623
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,623
|
|
||||||
Other long-term liabilities
|
|
—
|
|
|
1,861
|
|
|
46,315
|
|
|
4,384
|
|
|
—
|
|
|
52,560
|
|
||||||
Long-term debt
|
|
—
|
|
|
817,028
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
817,028
|
|
||||||
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Stockholders' Equity (Deficit):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Preferred stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Common stock
|
|
672
|
|
|
672
|
|
|
—
|
|
|
—
|
|
|
(672
|
)
|
|
672
|
|
||||||
Additional paid-in-capital
|
|
741,789
|
|
|
741,789
|
|
|
423,584
|
|
|
12,727
|
|
|
(1,178,100
|
)
|
|
741,789
|
|
||||||
(Accumulated deficit) retained earnings
|
|
(791,243
|
)
|
|
(791,243
|
)
|
|
(679,209
|
)
|
|
16,167
|
|
|
1,454,285
|
|
|
(791,243
|
)
|
||||||
Accumulated other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
comprehensive income (loss)
|
|
(3,214
|
)
|
|
(3,214
|
)
|
|
—
|
|
|
(2,937
|
)
|
|
6,151
|
|
|
(3,214
|
)
|
||||||
Total stockholders' (deficit) equity
|
|
(51,996
|
)
|
|
(51,996
|
)
|
|
(255,625
|
)
|
|
25,957
|
|
|
281,664
|
|
|
(51,996
|
)
|
||||||
|
|
$
|
(51,996
|
)
|
|
$
|
810,173
|
|
|
$
|
788,430
|
|
|
$
|
172,611
|
|
|
$
|
(676,967
|
)
|
|
$
|
1,042,251
|
|
PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
|
||||||||||||||||||||||||
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
|
||||||||||||||||||||||||
For the nine months ended September 27, 2014
|
||||||||||||||||||||||||
(Amounts in thousands)
|
|
Guarantor
|
|
Issuer
|
|
|
|
Non-
|
|
|
|
|
||||||||||||
|
|
Ply Gem
|
|
Ply Gem
|
|
Guarantor
|
|
Guarantor
|
|
Consolidating
|
|
|
||||||||||||
|
|
Holdings, Inc.
|
|
Industries, Inc.
|
|
Subsidiaries
|
|
Subsidiaries
|
|
Adjustments
|
|
Consolidated
|
||||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income (loss)
|
|
$
|
(18,793
|
)
|
|
$
|
(18,793
|
)
|
|
$
|
39,973
|
|
|
$
|
(15,531
|
)
|
|
$
|
(5,649
|
)
|
|
$
|
(18,793
|
)
|
Adjustments to reconcile net income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
to cash used in operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Depreciation and amortization expense
|
|
—
|
|
|
486
|
|
|
27,239
|
|
|
6,191
|
|
|
—
|
|
|
33,916
|
|
||||||
Fair-value premium on purchased inventory
|
|
—
|
|
|
—
|
|
|
38
|
|
|
—
|
|
|
—
|
|
|
38
|
|
||||||
Fair-value decrease of contingent acquisition liability
|
|
—
|
|
|
—
|
|
|
(264
|
)
|
|
—
|
|
|
—
|
|
|
(264
|
)
|
||||||
Non-cash restructuring costs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,012
|
|
|
—
|
|
|
3,012
|
|
||||||
Non-cash interest expense, net
|
|
—
|
|
|
11,606
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,606
|
|
||||||
Loss on foreign currency transactions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
517
|
|
|
—
|
|
|
517
|
|
||||||
Non-cash litigation expense
|
|
—
|
|
|
—
|
|
|
4,593
|
|
|
—
|
|
|
—
|
|
|
4,593
|
|
||||||
Loss on modification or extinguishment of debt
|
|
—
|
|
|
21,364
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21,364
|
|
||||||
Stock based compensation
|
|
—
|
|
|
1,672
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,672
|
|
||||||
Deferred income taxes
|
|
—
|
|
|
—
|
|
|
(22,227
|
)
|
|
5,032
|
|
|
—
|
|
|
(17,195
|
)
|
||||||
Tax receivable agreement liability adjustment
|
|
—
|
|
|
14,419
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,419
|
|
||||||
Increase in tax uncertainty,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
net of valuation allowance
|
|
—
|
|
|
—
|
|
|
254
|
|
|
—
|
|
|
—
|
|
|
254
|
|
||||||
Equity in subsidiaries' net loss
|
|
18,793
|
|
|
(24,442
|
)
|
|
—
|
|
|
—
|
|
|
5,649
|
|
|
—
|
|
||||||
Other
|
|
—
|
|
|
—
|
|
|
(50
|
)
|
|
(174
|
)
|
|
—
|
|
|
(224
|
)
|
||||||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Accounts receivable, net
|
|
—
|
|
|
—
|
|
|
(81,439
|
)
|
|
(21,289
|
)
|
|
—
|
|
|
(102,728
|
)
|
||||||
Inventories
|
|
—
|
|
|
—
|
|
|
(17,394
|
)
|
|
(6,680
|
)
|
|
—
|
|
|
(24,074
|
)
|
||||||
Prepaid expenses and other assets
|
|
—
|
|
|
189
|
|
|
2,673
|
|
|
(255
|
)
|
|
—
|
|
|
2,607
|
|
||||||
Accounts payable
|
|
—
|
|
|
(60
|
)
|
|
5,873
|
|
|
9,367
|
|
|
—
|
|
|
15,180
|
|
||||||
Accrued expenses
|
|
—
|
|
|
(18,259
|
)
|
|
11,865
|
|
|
4,926
|
|
|
—
|
|
|
(1,468
|
)
|
||||||
Cash payments on restructuring liabilities
|
|
—
|
|
|
—
|
|
|
(577
|
)
|
|
(3,835
|
)
|
|
—
|
|
|
(4,412
|
)
|
||||||
Other
|
|
—
|
|
|
2
|
|
|
(1,997
|
)
|
|
6,566
|
|
|
—
|
|
|
4,571
|
|
||||||
Net cash used in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
operating activities
|
|
—
|
|
|
(11,816
|
)
|
|
(31,440
|
)
|
|
(12,153
|
)
|
|
—
|
|
|
(55,409
|
)
|
||||||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Acquisitions, net of cash acquired and
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
outstanding checks assumed
|
|
—
|
|
|
(130,856
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(130,856
|
)
|
||||||
Capital expenditures
|
|
—
|
|
|
(1,075
|
)
|
|
(11,907
|
)
|
|
(1,542
|
)
|
|
—
|
|
|
(14,524
|
)
|
||||||
Proceeds from sale of assets
|
|
—
|
|
|
—
|
|
|
109
|
|
|
635
|
|
|
—
|
|
|
744
|
|
||||||
Net cash used in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
investing activities
|
|
—
|
|
|
(131,931
|
)
|
|
(11,798
|
)
|
|
(907
|
)
|
|
—
|
|
|
(144,636
|
)
|
||||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Proceeds from long-term debt
|
|
—
|
|
|
1,067,725
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,067,725
|
|
||||||
Net revolver borrowings
|
|
—
|
|
|
20,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20,000
|
|
||||||
Payments on long-term debt
|
|
—
|
|
|
(853,075
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(853,075
|
)
|
||||||
Payment of tender and early call premiums
|
|
—
|
|
|
(61,142
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(61,142
|
)
|
||||||
Proceeds from exercises of employee stock options
|
|
—
|
|
|
1,073
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,073
|
|
||||||
Proceeds from intercompany
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
investment
|
|
—
|
|
|
(59,762
|
)
|
|
44,781
|
|
|
14,981
|
|
|
—
|
|
|
—
|
|
||||||
Debt issuance costs paid
|
|
—
|
|
|
(16,721
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16,721
|
)
|
||||||
Net cash provided by (used in)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
financing activities
|
|
—
|
|
|
98,098
|
|
|
44,781
|
|
|
14,981
|
|
|
—
|
|
|
157,860
|
|
||||||
Impact of exchange rate movements on cash
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(834
|
)
|
|
—
|
|
|
(834
|
)
|
||||||
Net increase (decrease) in cash
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
and cash equivalents
|
|
—
|
|
|
(45,649
|
)
|
|
1,543
|
|
|
1,087
|
|
|
—
|
|
|
(43,019
|
)
|
||||||
Cash and cash equivalents at the
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
beginning of the period
|
|
—
|
|
|
57,800
|
|
|
(4,970
|
)
|
|
16,971
|
|
|
—
|
|
|
69,801
|
|
||||||
Cash and cash equivalents at the end
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
of the period
|
|
$
|
—
|
|
|
$
|
12,151
|
|
|
$
|
(3,427
|
)
|
|
$
|
18,058
|
|
|
$
|
—
|
|
|
$
|
26,782
|
|
PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
|
||||||||||||||||||||||||
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
|
||||||||||||||||||||||||
For the nine months ended September 28, 2013
|
||||||||||||||||||||||||
(Amounts in thousands)
|
|
Guarantor
|
|
Issuer
|
|
|
|
Non-
|
|
|
|
|
||||||||||||
|
|
Ply Gem
|
|
Ply Gem
|
|
Guarantor
|
|
Guarantor
|
|
Consolidating
|
|
|
||||||||||||
|
|
Holdings, Inc.
|
|
Industries, Inc.
|
|
Subsidiaries
|
|
Subsidiary
|
|
Adjustments
|
|
Consolidated
|
||||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income (loss)
|
|
$
|
(62,089
|
)
|
|
$
|
(62,089
|
)
|
|
$
|
(12,282
|
)
|
|
$
|
458
|
|
|
$
|
73,913
|
|
|
$
|
(62,089
|
)
|
Adjustments to reconcile net income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
to cash provided by (used in) operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Depreciation and amortization expense
|
|
—
|
|
|
315
|
|
|
28,744
|
|
|
3,924
|
|
|
—
|
|
|
32,983
|
|
||||||
Fair-value premium on purchased inventory
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,015
|
|
|
—
|
|
|
2,015
|
|
||||||
Fair-value decrease of contingent acquisition liability
|
|
—
|
|
|
—
|
|
|
(358
|
)
|
|
—
|
|
|
—
|
|
|
(358
|
)
|
||||||
Non-cash interest expense, net
|
|
—
|
|
|
9,457
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,457
|
|
||||||
Loss on foreign currency transactions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
755
|
|
|
—
|
|
|
755
|
|
||||||
Loss on modification or extinguishment of debt
|
|
—
|
|
|
18,948
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18,948
|
|
||||||
Prepaid management fee write off
|
|
—
|
|
|
2,682
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,682
|
|
||||||
Stock based compensation
|
|
—
|
|
|
1,631
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,631
|
|
||||||
Deferred income taxes
|
|
—
|
|
|
—
|
|
|
1,937
|
|
|
(172
|
)
|
|
—
|
|
|
1,765
|
|
||||||
Tax receivable agreement liability adjustment
|
|
—
|
|
|
1,474
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,474
|
|
||||||
Reduction in tax uncertainty,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
net of valuation allowance
|
|
—
|
|
|
—
|
|
|
(1,279
|
)
|
|
—
|
|
|
—
|
|
|
(1,279
|
)
|
||||||
Equity in subsidiaries' net loss
|
|
62,089
|
|
|
11,824
|
|
|
—
|
|
|
—
|
|
|
(73,913
|
)
|
|
—
|
|
||||||
Other
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
||||||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Accounts receivable, net
|
|
—
|
|
|
—
|
|
|
(67,244
|
)
|
|
(8,159
|
)
|
|
—
|
|
|
(75,403
|
)
|
||||||
Inventories
|
|
—
|
|
|
—
|
|
|
(13,605
|
)
|
|
1,875
|
|
|
—
|
|
|
(11,730
|
)
|
||||||
Prepaid expenses and other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
current assets
|
|
—
|
|
|
(5,322
|
)
|
|
(294
|
)
|
|
435
|
|
|
—
|
|
|
(5,181
|
)
|
||||||
Accounts payable
|
|
—
|
|
|
107
|
|
|
3,142
|
|
|
(7,441
|
)
|
|
—
|
|
|
(4,192
|
)
|
||||||
Accrued expenses
|
|
—
|
|
|
(2,713
|
)
|
|
17,428
|
|
|
11,837
|
|
|
—
|
|
|
26,552
|
|
||||||
Payment of advisory termination fee to affiliate
|
|
—
|
|
|
(18,852
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(18,852
|
)
|
||||||
Cash payments on restructuring liabilities
|
|
—
|
|
|
—
|
|
|
(2,535
|
)
|
|
(358
|
)
|
|
—
|
|
|
(2,893
|
)
|
||||||
Other
|
|
—
|
|
|
—
|
|
|
87
|
|
|
(999
|
)
|
|
—
|
|
|
(912
|
)
|
||||||
Net cash provided by (used in)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
operating activities
|
|
—
|
|
|
(42,538
|
)
|
|
(46,264
|
)
|
|
4,170
|
|
|
—
|
|
|
(84,632
|
)
|
||||||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Acquisitions, net of cash acquired
|
|
—
|
|
|
(99,282
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(99,282
|
)
|
||||||
Capital expenditures
|
|
—
|
|
|
(542
|
)
|
|
(15,014
|
)
|
|
(758
|
)
|
|
—
|
|
|
(16,314
|
)
|
||||||
Proceeds from sale of assets
|
|
—
|
|
|
—
|
|
|
24
|
|
|
—
|
|
|
—
|
|
|
24
|
|
||||||
Net cash used in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
investing activities
|
|
—
|
|
|
(99,824
|
)
|
|
(14,990
|
)
|
|
(758
|
)
|
|
—
|
|
|
(115,572
|
)
|
||||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net revolver payments
|
|
—
|
|
|
(1,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,000
|
)
|
||||||
Payments on long-term debt
|
|
—
|
|
|
(148,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(148,000
|
)
|
||||||
Payment of early call premium
|
|
—
|
|
|
(8,520
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,520
|
)
|
||||||
Net proceeds from issuance of common stock
|
|
—
|
|
|
353,407
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
353,407
|
|
||||||
Proceeds from intercompany
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
investment
|
|
—
|
|
|
(60,152
|
)
|
|
57,582
|
|
|
2,570
|
|
|
—
|
|
|
—
|
|
||||||
Debt issuance costs paid
|
|
—
|
|
|
(62
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(62
|
)
|
||||||
Net cash provided by
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
financing activities
|
|
—
|
|
|
135,673
|
|
|
57,582
|
|
|
2,570
|
|
|
—
|
|
|
195,825
|
|
||||||
Impact of exchange rate movement
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
on cash
|
|
—
|
|
|
—
|
|
|
—
|
|
|
301
|
|
|
—
|
|
|
301
|
|
||||||
Net increase (decrease) in cash
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
and cash equivalents
|
|
—
|
|
|
(6,689
|
)
|
|
(3,672
|
)
|
|
6,283
|
|
|
—
|
|
|
(4,078
|
)
|
||||||
Cash and cash equivalents at the
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
beginning of the period
|
|
—
|
|
|
23,332
|
|
|
(4,307
|
)
|
|
8,169
|
|
|
—
|
|
|
27,194
|
|
||||||
Cash and cash equivalents at the end
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
of the period
|
|
$
|
—
|
|
|
$
|
16,643
|
|
|
$
|
(7,979
|
)
|
|
$
|
14,452
|
|
|
$
|
—
|
|
|
$
|
23,116
|
|
|
|
For the three months ended
|
|
For the nine months ended
|
|
||||||||||||
(Amounts in thousands)
|
|
September 27, 2014
|
|
September 28, 2013
|
|
September 27, 2014
|
|
September 28, 2013
|
|
||||||||
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
||||||||
Net sales
|
|
|
|
|
|
|
|
|
|
||||||||
Siding, Fencing and Stone
|
|
$
|
244,416
|
|
|
$
|
228,214
|
|
|
$
|
609,419
|
|
|
$
|
565,010
|
|
|
Windows and Doors
|
|
193,432
|
|
|
179,212
|
|
|
507,105
|
|
|
467,653
|
|
|
||||
Operating earnings (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Siding, Fencing and Stone
|
|
44,756
|
|
|
39,476
|
|
|
89,484
|
|
|
92,998
|
|
|
||||
Windows and Doors
|
|
3,773
|
|
|
(4,489
|
)
|
|
(17,793
|
)
|
|
(22,549
|
)
|
|
||||
Unallocated
|
|
(6,602
|
)
|
|
(4,067
|
)
|
|
(18,116
|
)
|
|
(39,439
|
)
|
|
||||
Foreign currency gain (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Siding, Fencing and Stone
|
|
(352
|
)
|
|
100
|
|
|
(278
|
)
|
|
33
|
|
|
||||
Windows and Doors
|
|
(414
|
)
|
|
(476
|
)
|
|
(239
|
)
|
|
(788
|
)
|
|
||||
Interest income (expense), net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Siding, Fencing and Stone
|
|
7
|
|
|
153
|
|
|
13
|
|
|
148
|
|
|
||||
Windows and Doors
|
|
6
|
|
|
156
|
|
|
15
|
|
|
183
|
|
|
||||
Unallocated
|
|
(16,295
|
)
|
|
(22,069
|
)
|
|
(52,029
|
)
|
|
(70,577
|
)
|
|
||||
Income tax benefit (provision)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Unallocated
|
|
10,514
|
|
|
1,442
|
|
|
15,933
|
|
|
(1,676
|
)
|
|
||||
Tax Receivable Agreement liability adjustment
|
|
|
|
|
|
|
|
|
|
||||||||
Unallocated
|
|
(13,988
|
)
|
|
6,669
|
|
|
(14,419
|
)
|
|
(1,474
|
)
|
|
||||
Loss on modification or
|
|
|
|
|
|
|
|
|
|
|
|
||||||
extinguishment of debt
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Unallocated
|
|
—
|
|
|
—
|
|
|
(21,364
|
)
|
|
(18,948
|
)
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
|
$
|
21,405
|
|
|
$
|
16,895
|
|
|
$
|
(18,793
|
)
|
|
$
|
(62,089
|
)
|
|
|
|
For the three months ended
|
||||||||||||
(Amounts in thousands)
|
|
September 27, 2014
|
|
September 28, 2013
|
||||||||||
|
|
(unaudited)
|
|
(unaudited)
|
||||||||||
Statement of operations data:
|
|
|
|
|
|
|
|
|
||||||
Net sales
|
|
$
|
244,416
|
|
|
100.0
|
%
|
|
$
|
228,214
|
|
|
100.0
|
%
|
Gross profit
|
|
68,587
|
|
|
28.1
|
%
|
|
63,255
|
|
|
27.7
|
%
|
||
SG&A expense
|
|
20,543
|
|
|
8.4
|
%
|
|
20,235
|
|
|
8.9
|
%
|
||
Amortization of intangible assets
|
|
3,288
|
|
|
1.3
|
%
|
|
3,544
|
|
|
1.6
|
%
|
||
Operating earnings
|
|
44,756
|
|
|
18.3
|
%
|
|
39,476
|
|
|
17.3
|
%
|
||
Currency transaction gain (loss)
|
|
(352
|
)
|
|
(0.1
|
)%
|
|
100
|
|
|
—
|
%
|
|
|
For the nine months ended
|
||||||||||||
(Amounts in thousands)
|
|
September 27, 2014
|
|
September 28, 2013
|
||||||||||
|
|
(unaudited)
|
|
(unaudited)
|
||||||||||
Statement of operations data:
|
|
|
|
|
|
|
|
|
||||||
Net sales
|
|
$
|
609,419
|
|
|
100.0
|
%
|
|
$
|
565,010
|
|
|
100.0
|
%
|
Gross profit
|
|
160,894
|
|
|
26.4
|
%
|
|
152,471
|
|
|
27.0
|
%
|
||
SG&A expense
|
|
61,487
|
|
|
10.1
|
%
|
|
51,163
|
|
|
9.1
|
%
|
||
Amortization of intangible assets
|
|
9,923
|
|
|
1.6
|
%
|
|
8,310
|
|
|
1.5
|
%
|
||
Operating earnings
|
|
89,484
|
|
|
14.7
|
%
|
|
92,998
|
|
|
16.5
|
%
|
||
Currency transaction gain (loss)
|
|
(278
|
)
|
|
—
|
%
|
|
33
|
|
|
—
|
%
|
|
|
For the three months ended
|
||||||||||||
(Amounts in thousands)
|
|
September 27, 2014
|
|
September 28, 2013
|
||||||||||
|
|
(unaudited)
|
|
(unaudited)
|
||||||||||
Statement of operations data:
|
|
|
|
|
|
|
|
|
||||||
Net sales
|
|
$
|
193,432
|
|
|
100.0
|
%
|
|
$
|
179,212
|
|
|
100.0
|
%
|
Gross profit
|
|
30,002
|
|
|
15.5
|
%
|
|
20,913
|
|
|
11.7
|
%
|
||
SG&A expense
|
|
24,210
|
|
|
12.5
|
%
|
|
23,295
|
|
|
13.0
|
%
|
||
Amortization of intangible assets
|
|
2,019
|
|
|
1.0
|
%
|
|
2,107
|
|
|
1.2
|
%
|
||
Operating earnings (loss)
|
|
3,773
|
|
|
2.0
|
%
|
|
(4,489
|
)
|
|
(2.5
|
)%
|
||
Currency transaction loss
|
|
(414
|
)
|
|
(0.2
|
)%
|
|
(476
|
)
|
|
(0.3
|
)%
|
|
|
For the three months ended
|
||||||
(Amounts in thousands)
|
|
September 27, 2014
|
|
September 28, 2013
|
||||
|
|
(unaudited)
|
|
(unaudited)
|
||||
Statement of operations data:
|
|
|
|
|
||||
SG&A expense
|
|
$
|
(6,602
|
)
|
|
$
|
(4,067
|
)
|
Operating loss
|
|
(6,602
|
)
|
|
(4,067
|
)
|
||
Interest expense
|
|
(16,296
|
)
|
|
(22,070
|
)
|
||
Interest income
|
|
1
|
|
|
1
|
|
||
Tax receivable agreement liability adjustment
|
|
(13,988
|
)
|
|
6,669
|
|
||
Income tax benefit for income taxes
|
|
$
|
10,514
|
|
|
$
|
1,442
|
|
|
|
For the nine months ended
|
||||||
(Amounts in thousands)
|
|
September 27, 2014
|
|
September 28, 2013
|
||||
|
|
(unaudited)
|
|
(unaudited)
|
||||
Statement of operations data:
|
|
|
|
|
||||
SG&A expense
|
|
$
|
(18,116
|
)
|
|
$
|
(15,912
|
)
|
Initial public offering costs
|
|
—
|
|
|
(23,527
|
)
|
||
Operating loss
|
|
(18,116
|
)
|
|
(39,439
|
)
|
||
Interest expense
|
|
(52,033
|
)
|
|
(70,583
|
)
|
||
Interest income
|
|
4
|
|
|
6
|
|
||
Loss on modification or extinguishment of debt
|
|
(21,364
|
)
|
|
(18,948
|
)
|
||
Tax receivable agreement liability adjustment
|
|
(14,419
|
)
|
|
(1,474
|
)
|
||
Income tax benefit (provision) for income taxes
|
|
$
|
15,933
|
|
|
$
|
(1,676
|
)
|
(Amounts in thousands)
|
|
|
||
Advisory termination fee to affiliate
|
|
$
|
18,852
|
|
2013 management fee as of date of termination
|
|
2,682
|
|
|
Other transaction expenses for the IPO
|
|
1,993
|
|
|
|
|
$
|
23,527
|
|
(Amounts in thousands)
|
|
For the nine months ended
|
||||||
|
|
September 27, 2014
|
|
September 28, 2013
|
||||
Loss on extinguishment of debt:
|
|
|
|
|
|
|
||
Tender premium
|
|
$
|
(8,493
|
)
|
|
$
|
—
|
|
8.25% Senior Secured Notes and 9.375% Senior Notes unamortized discount
|
|
(4,773
|
)
|
|
—
|
|
||
8.25% Senior Secured Notes and 9.375% Senior Notes unamortized debt issuance costs
|
|
(2,067
|
)
|
|
—
|
|
||
Term Loan Facility unamortized discount
|
|
(255
|
)
|
|
—
|
|
||
Call premium for 8.25% Senior Secured Notes
|
|
—
|
|
|
(2,520
|
)
|
||
8.25% Senior Secured Notes unamortized discount
|
|
—
|
|
|
(3,831
|
)
|
||
8.25% Senior Secured Notes unamortized debt issuance costs
|
|
—
|
|
|
(1,766
|
)
|
||
Call premium for 9.375% Senior Notes
|
|
—
|
|
|
(6,000
|
)
|
||
9.375% Senior Notes unamortized discount
|
|
—
|
|
|
(3,666
|
)
|
||
9.375% Senior Notes unamortized debt issuance costs
|
|
—
|
|
|
(1,165
|
)
|
||
|
|
(15,588
|
)
|
|
(18,948
|
)
|
||
Loss on modification of debt:
|
|
|
|
|
||||
Third party fees for 8.25% Senior Secured Notes and 9.375% Senior Notes
|
|
(302
|
)
|
|
—
|
|
||
Third party fees for 6.50% Senior Notes and Term Loan Facility
|
|
(5,474
|
)
|
|
—
|
|
||
|
|
(5,776
|
)
|
|
—
|
|
||
|
|
|
|
|
||||
Total loss on modification or extinguishment of debt
|
|
$
|
(21,364
|
)
|
|
$
|
(18,948
|
)
|
•
|
our high degree of leverage and significant debt service obligations;
|
•
|
restrictions under the indenture governing the 6.50% Senior Notes and the restrictions under our Term Loan Facility and ABL Facility;
|
•
|
the competitive nature of our industry;
|
•
|
changes in interest rates, and general economic, home repair and remodeling and new home construction market conditions;
|
•
|
changes in the price and availability of raw materials; and
|
•
|
changes in our relationships with our significant customers.
|
By:
|
/s/ Gary E. Robinette
|
|
Gary E. Robinette
|
|
President, Chief Executive Officer, and
Vice Chairman of the Board |
By:
|
/s/ Shawn K. Poe
|
|
Shawn K. Poe
|
|
Vice President, Chief Financial Officer, Treasurer and Secretary
|
1.
|
Definitions; Interpretive Provisions
1
|
1.1
|
Definitions
1
|
1.2
|
Interpretive Provisions
10
|
2.
|
Sale of the Shares; Closing; Purchase Price Adjustment Payment
10
|
2.1
|
Sale of Shares
10
|
2.2
|
Purchase Price
10
|
2.3
|
Closing
11
|
2.4
|
Closing Deliveries
11
|
2.5
|
Treatment of Payments
12
|
3.
|
Representations and Warranties of the Shareholder
12
|
3.1
|
Organization and Good Standing
12
|
3.2
|
Authority and Due Execution
12
|
3.3
|
No Conflict
12
|
3.4
|
Capitalization
13
|
3.5
|
Financial Statements
14
|
3.6
|
Title to Properties; Encumbrances
14
|
3.7
|
No Undisclosed Liabilities
15
|
3.8
|
Indebtedness
16
|
3.9
|
Taxes
16
|
3.10
|
No Material Adverse Change
17
|
3.11
|
Employee Benefits
17
|
3.12
|
Compliance with Legal Requirements; Governmental Authorizations
19
|
3.13
|
Legal Proceedings; Orders
20
|
3.14
|
Absence of Certain Changes and Events
20
|
3.15
|
Contracts
22
|
3.16
|
Environmental Matters
23
|
3.17
|
Employees
24
|
3.18
|
Labor Relations; Compliance
24
|
3.19
|
Intellectual Property
25
|
3.20
|
Brokers or Finders
26
|
3.21
|
Suppliers and Distributors
26
|
3.22
|
Product Liability
26
|
3.23
|
Permits
27
|
3.24
|
Affiliate Transactions
27
|
3.25
|
Representations on Closing Date
27
|
4.
|
Representations and Warranties of Buyer
27
|
4.1
|
Organization and Good Standing
27
|
4.2
|
Authority; No Conflict
27
|
4.3
|
Sufficient Funds
28
|
4.4
|
Certain Proceedings
28
|
4.5
|
Brokers or Finders
28
|
5.
|
Covenants of the Shareholder and the Companies
28
|
5.1
|
Access and Investigation
28
|
5.2
|
Operation of the Businesses of the Companies
29
|
5.3
|
Required Approvals
30
|
5.4
|
Reasonable Best Efforts
30
|
5.5
|
Tax Matters
30
|
5.6
|
Consents
30
|
5.7
|
Closing Indebtedness and Intercompany Payables and Receivables
30
|
5.8
|
Terminations of Transactions with Related Parties
30
|
5.9
|
Confidentiality
31
|
5.10
|
Non-Competition; Non-Solicitation
31
|
5.11
|
Cooperation
33
|
5.12
|
Insurance Matters
34
|
5.13
|
PVC Extrusion Lines
34
|
5.14
|
401(K) Plan Rollovers
35
|
6.
|
Covenants of Buyer
35
|
6.1
|
Required Approvals
35
|
6.2
|
Reasonable Best Efforts
35
|
6.3
|
Employment
35
|
6.4
|
Release
36
|
7.
|
Conditions Precedent to Buyer’s Obligation to Close
36
|
7.1
|
Accuracy of Representations
36
|
7.2
|
Shareholder Performance
36
|
7.3
|
Simex Supply Agreement
36
|
7.4
|
No Injunction
36
|
7.5
|
Regulatory Consents
36
|
7.6
|
Material Adverse Effect
37
|
7.7
|
Transition Services Agreement
37
|
7.8
|
Notice of Termination of Severance Plans
37
|
8.
|
Conditions Precedent to the Shareholder’s Obligation to Close
37
|
8.1
|
Accuracy of Representations
37
|
8.2
|
Buyer’s Performance
37
|
8.3
|
Simex Supply Agreement
37
|
8.4
|
No Injunction
38
|
8.5
|
Regulatory Consents
38
|
9.
|
Termination
38
|
9.1
|
Termination Events
38
|
9.2
|
Effect of Termination
39
|
10.
|
Indemnification; Remedies
39
|
10.1
|
Survival
39
|
10.2
|
Indemnification and Payment of Damages by the Shareholder or Buyer
39
|
10.3
|
Survival Period
40
|
10.4
|
Limitations on Amount
40
|
10.5
|
Procedure for Indemnification -- Third Party Claims
40
|
10.6
|
Procedure for Indemnification - Other Claims
41
|
10.7
|
No Right of Contributions
41
|
10.8
|
Limitations on Indemnification
41
|
10.9
|
Calculation of Damages
41
|
11.
|
Tax Indemnification; Tax Matters
42
|
11.1
|
Tax Indemnification
42
|
11.2
|
Tax Indemnification Procedures
42
|
11.3
|
Tax Audits and Contests; Cooperation
43
|
11.4
|
Preparation of Tax Returns and Payment of Taxes
44
|
11.5
|
Straddle Periods
46
|
11.6
|
Refunds
47
|
11.7
|
Transfer Taxes
47
|
11.8
|
Tax Sharing Agreements
47
|
12.
|
Guarantee
47
|
12.1
|
Guarantee by FBHS
47
|
13.
|
General Provisions
47
|
13.1
|
Expenses
47
|
13.2
|
Public Announcements
48
|
13.3
|
Confidentiality
48
|
13.4
|
Notices
48
|
13.5
|
Jurisdiction
49
|
13.6
|
Waiver
49
|
13.7
|
Entire Agreement and Modification
49
|
13.8
|
Assignments and Successors
49
|
13.9
|
Severability
50
|
13.10
|
Use of Fortune Brands Name
50
|
13.11
|
Governing Law
50
|
13.12
|
No Third Party Beneficiaries
50
|
13.13
|
Counterparts
50
|
13.14
|
Waiver of Jury Trial
50
|
1.
|
Definitions; Interpretive Provisions
|
3.
|
Representations and Warranties of the Shareholder
|
4.
|
Representations and Warranties of Buyer
|
5.
|
Covenants of the Shareholder and the Companies
|
7.
|
Conditions Precedent to Buyer’s Obligation to Close
|
8.
|
Conditions Precedent to the Shareholder’s Obligation to Close
|
9.
|
Termination
|
10.
|
Indemnification; Remedies
|
11.
|
Tax Indemnification; Tax Matters
|
12.
|
Guarantee
|
13.
|
General Provisions
|
|
/s/ Gary E. Robinette
|
Name:
|
Gary E. Robinette
|
Title:
|
President, Chief Executive Officer, and
Vice Chairman of the Board |
|
/s/ Shawn K. Poe
|
Name:
|
Shawn K. Poe
|
Title:
|
Vice President, Chief Financial Officer, Treasurer and Secretary
|
Date: November 7, 2014
|
/s/ Gary E. Robinette
|
|
Gary E. Robinette
|
|
President, Chief Executive Officer, and
Vice Chairman of the Board |
Date: November 7, 2014
|
/s/ Shawn K. Poe
|
|
Shawn K. Poe
|
|
Vice President, Chief Financial Officer, Treasurer and Secretary
|