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): January 11,
2010
PLY
GEM HOLDINGS, INC.
(Exact
name of registrant as specified in its charter)
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Delaware
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333-114041
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20-0645710
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(State
or other jurisdiction of incorporation)
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(Commission
File No.)
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(IRS
Employer Identification No.)
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5020
Weston Parkway, Suite 400
Cary,
North Carolina 27513
(Address
of principal executive offices)
(919)
677-3900
(Registrant’s
telephone number, including area code)
NOT
APPLICABLE
(Former
name or former address, if changed since last report)
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 (see General
Instruction A.2. below):
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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o
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
1.01
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Entry Into a Material
Definitive Agreement.
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On
January 11, 2010, Ply Gem Industries, Inc. (“Ply Gem Industries”), a
wholly-owned subsidiary of Ply Gem Holdings, Inc. (the “Company”), completed its
previously announced offering of $150.0 million aggregate principal amount of
13.125% Senior Subordinated Notes due 2014 (the “Notes”). Ply Gem
Industries intends to use the proceeds of the offering to redeem approximately
$141.2 million aggregate principal amount of its 9% Senior Subordinated Notes
due 2012 (the “9% Notes”) and to pay
certain related costs and expenses.
In
connection with the issuance of the Notes, Ply Gem Industries, the Company and
each of the direct and indirect domestic subsidiaries of Ply Gem Industries
(collectively with the Company, the “Guarantors”) entered into (i) an Indenture,
dated as of January 11, 2010 (the “Indenture”), among Ply Gem Industries, the
Guarantors and U.S. Bank National Association, as trustee (the “Trustee”) and
(ii) a Registration Rights Agreement, dated as of January 11, 2010 (the
“Registration Rights Agreement”), among Ply Gem Industries, the Guarantors and
the Initial Purchasers named therein (the “Initial Purchasers”).
U.S. Bank
National Association also serves as trustee in respect of the 9% Notes and Ply
Gem Industries’ 11.75% Senior Secured Notes due 2013 (the “Senior Secured
Notes”).
In the
ordinary course of their business, the Initial Purchasers and certain of their
affiliates have in the past and may in the future engage in investment and
commercial banking or other transactions of a financial nature with the Company
or its affiliates, including CI Capital Partners LLC, including the provision of
certain advisory services and the making of loans to the Company and its
affiliates. In particular, certain affiliates of the Initial Purchasers are
agents and/or lenders under Ply Gem Industries’ existing senior credit
facilities (the “ABL Facility”). In addition, one of the Initial
Purchasers acted as dealer manager in connection with Ply Gem Industries’
exchange offer for the 9% Notes which expired on December 17,
2009. Furthermore, the Initial Purchasers and certain of their
affiliates may from time to time hold long or short positions in securities of
the Company and/or its affiliates, including the 9% Notes.
Maturity
Date and Interest Rate
The Notes
will mature on July 15, 2014. Interest on the Notes will accrue at
13.125% per annum and will be payable on January 15 and July 15 of each year,
commencing on July 15, 2010. The Notes were priced at 97.139% of the
principal amount, representing a yield to maturity of 14.0%.
Rankings
and Guarantees
The Notes
will be unsecured and will be subordinated in right of payment to all of Ply Gem
Industries’ existing and future senior debt, including borrowings under the ABL
Facility and the Senior Secured Notes. The Notes will be structurally
subordinated to all indebtedness and other liabilities (including trade
payables) of Ply Gem Industries’ subsidiaries that are not guarantors of the
Notes.
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The Notes
will initially be jointly and severally, irrevocably and unconditionally
guaranteed on a senior subordinated basis, subject to certain limitations, by
the Company and all of Ply Gem Industries’ subsidiaries located in the United
States (other than Unrestricted Securities as such term is defined in the
Indenture). The guarantees will be general unsecured obligations of
the guarantors and will be subordinated in right of payment to all existing and
future senior debt of the guarantors, which includes their guarantees under the
ABL Facility and the Senior Secured Notes.
Optional
Redemption
Prior to
January 15, 2012, Ply Gem Industries may redeem up to 40% of the aggregate
principal amount of the Notes with the net cash proceeds from certain equity
offerings at a redemption price equal to 113.125% of the aggregate principal
amount of the Notes, plus accrued and unpaid interest, if any, provided that at
least 60% of the original aggregate principal amount of the Notes remains
outstanding after the redemption. On or after January 15, 2012, and
prior to January 15, 2013, Ply Gem Industries may redeem up to 100% of the
aggregate principal amount of the Notes with the net cash proceeds from certain
equity offerings at a redemption price equal to 103% of the aggregate principal
amount of the Notes, plus accrued and unpaid interest, if any. On or
after January 15, 2013, Ply Gem Industries may redeem up to 100% of the
aggregate principal amount of the Notes with the net cash proceeds from certain
equity offerings at a redemption price equal to 100% of the aggregate principal
amount of the Notes, plus accrued and unpaid interest, if any.
At any
time on or after January 15, 2012, Ply Gem Industries may redeem the Notes, in
whole or in part, at the redemption prices listed in the Indenture.
Change
of Control
Upon the
occurrence of specified change of control events, Ply Gem Industries may be
required to offer to purchase the Notes at a purchase price equal to 101% of the
aggregate principal amount, plus accrued and unpaid interest, if
any.
Following
any such offer to purchase, under certain circumstances, prior to January 15,
2012, Ply Gem Industries may redeem all, but not less than all, of the Notes not
tendered in such offer at a price equal to 101% of the principal amount, plus
accrued and unpaid interest.
In
addition, if Ply Gem Industries experiences a change of control prior to January
15, 2012, it may redeem all, but not less than all, of the Notes at a redemption
price equal to 100% of the principal amount plus a “make-whole”
premium.
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Certain
Covenants
The
Indenture contains certain customary covenants that, subject to significant
exceptions, limit the ability of Ply Gem Industries and its restricted
subsidiaries to, among other things, incur additional indebtedness, pay
dividends or make other distributions or repurchase or redeem their stock or
make restricted payments in respect of subordinated indebtedness, make
investments, sell assets, incur certain liens, enter into agreements restricting
their subsidiaries’ ability to pay dividends, issue senior subordinated
indebtedness, enter into transactions with affiliates, and consolidate, merge or
sell all or substantially all of their assets. These covenants
generally do not restrict the Company or any of its subsidiaries that are not
Ply Gem Industries’ subsidiaries.
Events
of Default
The
Indenture contains events of default, customary for transactions of this type,
including, but not limited to, payment defaults, covenant defaults,
cross-acceleration and payment defaults to certain indebtedness, certain events
of bankruptcy, material judgments and failure of guarantees by certain
Guarantors to be in full force and effect. If an event of default,
other than a bankruptcy default, occurs and is continuing with respect to Ply
Gem Industries, the principal amount of the Notes, plus accrued and unpaid
interest, if any, may be declared immediately due and payable.
Registration
Rights; Additional Interest
Under the
Registration Rights Agreement, Ply Gem Industries and the Guarantors agreed
to:
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·
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file
a registration statement within 180 days after the issue date of the Notes
enabling holders to exchange the Notes for registered Notes with terms
substantially identical to the terms of the
Notes;
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use
their commercially reasonable efforts to cause the registration statement
to become effective under the Securities Act within 240 days after the
issue date of the Notes;
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use
their commercially reasonable efforts to complete the exchange offer
within 280 days after the issue date of the Notes;
and
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use
their commercially reasonable efforts to file a shelf registration
statement for the resale of the Notes if they cannot complete an exchange
offer within those time periods listed above and in certain other
circumstances.
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Ply Gem
Industries will be required to pay additional interest (“Additional Interest”)
on the Notes that are transfer restricted securities if it fails to comply with
certain of its obligations under the Registration Rights Agreement within the
specified time periods. In addition, Ply Gem Industries and the
Guarantors have agreed to indemnify the Initial Purchasers against certain
liabilities on customary terms.
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Item
2.03
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Creation of a Direct
Financial Obligation or an Obligation under an Off-Balance Sheet
Arrangement of a Registrant.
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See
discussion under Item 1.01 above, which discussion is incorporated by reference
herein.
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Item
8.01
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Other
Events.
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On
January 11, 2010, a notice of redemption for the 9% Notes was sent to the
holders of such notes. The 9% Notes will be redeemed on February 16,
2010 at a redemption price of 100% of the principal amount thereof plus accrued
interest. As previously disclosed, following a series of
transactions, the Company expects that approximately $218.8 million aggregate
principal amount of the 9% Notes currently held by the indirect parent company
of the Company will be contributed to Ply Gem Industries as a capital
contribution for no consideration and cancelled prior to February 16,
2010. The regular interest payment on the 9% Notes payable on
February 15, 2010 will be paid to holders of record on February 1,
2010.
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has
duly caused this report on Form 8-K to be signed on its behalf by the
undersigned, thereunto duly authorized.
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PLY
GEM HOLDINGS, INC.
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By:
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/s/ Shawn K. Poe | |
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Name:
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Shawn
K. Poe
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Title:
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Vice
President, Chief Financial Officer
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Dated: January
11, 2010
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