Document and Entity Information

3 Months Ended

Apr. 1, 2017

May 8, 2017

Document and Entity Information [Abstract]

Entity Registrant Name

PLY GEM HOLDINGS INC

Entity Central Index Key

0001284807

Current Fiscal Year End Date

--12-31

Entity Filer Category

Accelerated Filer

Document Type

10-Q

Document Period End Date

Apr. 01, 2017

Document Fiscal Year Focus

2017

Document Fiscal Period Focus

Q1

Trading Symbol

PGEM

Amendment Flag

false

Entity Common Stock, Shares Outstanding

68,413,735

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (USD $)

In Thousands, except Share data, unless otherwise specified

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Income Statement [Abstract]

Net sales

$ 430,015

$ 408,614

Cost of products sold

340,490

321,913

Gross profit

89,525

86,701

Operating expenses:

Selling, general and administrative expenses

72,355

70,735

Amortization of intangible assets

5,344

6,400

Total operating expenses

77,699

77,125

Operating earnings

11,826

9,576

Foreign currency (loss) gain

155

584

Interest expense

(16,886)

(18,692)

Interest income

14

10

Gains (Losses) on Extinguishment of Debt

0

(2,399)

Tax receivable agreement liability adjustment

0

(18,150)

Income (Loss) before provision (benefit) for income taxes

(4,891)

(29,071)

Provision (benefit) for income taxes

(1,254)

(1,494)

Net income (loss)

(3,637)

(27,577)

Comprehensive income (loss)

$ (3,618)

$ (24,524)

Basic and diluted net loss per share attributable to common shareholders

$ (0.05)

$ (0.40)

Basic and diluted weighted average shares outstanding

68,399,887

68,127,491

CONSOLIDATED BALANCE SHEETS (USD $)

In Thousands, unless otherwise specified

Apr. 1, 2017

Dec. 31, 2016

Apr. 2, 2016

Dec. 31, 2015

Current Assets:

Cash and cash equivalents

$ 20,661

$ 51,597

$ 34,341

$ 109,425

Accounts receivable, less allowances of $2,775 and $2,663, respectively

215,758

209,919

Inventories:

Raw materials

78,619

69,639

Work in process

28,373

24,621

Finished goods

78,374

67,696

Total inventory

185,366

161,956

Prepaid expenses and other current assets

25,525

26,850

Total current assets

447,310

450,322

Property and Equipment, at cost:

Land

8,257

8,249

Buildings and improvements

67,393

67,951

Machinery and equipment

420,841

413,565

Total property and equipment

496,491

489,765

Less accumulated depreciation

(330,550)

(324,209)

Total property and equipment, net

165,941

165,556

Other Assets:

Intangible assets, net

98,942

104,159

Goodwill

478,795

478,514

Deferred Tax Assets, Net of Valuation Allowance, Noncurrent

51,599

50,347

Other

8,409

8,843

Total other assets

637,745

641,863

Total Assets

1,250,996

1,257,741

Current Liabilities:

Accounts payable

84,807

75,398

Accrued expenses

124,771

169,015

Current portion of payable to related parties pursuant to tax receivable agreement

25,383

Less current portion of long-term debt

4,300

Total current liabilities

239,261

274,096

Deferred income taxes

693

2,722

Long-term portion of payable to related parties pursuant to tax receivable agreement

54,336

Other long-term liabilities

84,100

86,395

Long-term debt

868,338

836,086

Commitments and contingencies

Stockholders' Equity:

Preferred stock $0.01 par, 50,000,000 shares authorized, none issued and outstanding

0

Common stock $0.01 par, 250,000,000 shares authorized, 68,407,259 and 68,269,749 issued and outstanding, respectively

684

683

Additional paid-in-capital

753,911

751,452

Accumulated deficit

(717,054)

(714,737)

Accumulated other comprehensive loss

(33,273)

(33,292)

Total stockholders' equity

4,268

4,106

Total Liabilities and Stockholder's Deficit

$ 1,250,996

$ 1,257,741

CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)

In Thousands, except Share data, unless otherwise specified

Apr. 1, 2017

Dec. 31, 2016

Current Assets:

Allowance for Doubtful Accounts Receivable, Current

$ 2,775

$ 2,663

Stockholders' Equity:

Preferred stock, par value (in dollars per share)

$ 0.01

Preferred stock, shares authorized (in shares)

50,000,000

Preferred stock, shares issued (in shares)

0

Preferred stock, shares outstanding (in shares)

0

Common stock, par value (in dollars per share)

$ 0.01

Common stock, shares authorized (in shares)

250,000,000

Common stock, shares issued (in shares)

68,407,259

68,269,749

Common stock, shares outstanding (in shares)

68,407,259

68,269,749

CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)

In Thousands, unless otherwise specified

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Cash flows from operating activities:

Net income (loss)

$ (3,637)

$ (27,577)

Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities:

Depreciation and amortization expense

13,453

14,030

Restructuring Costs

904

566

Non-cash interest expense, net

3,477

3,416

Gain on foreign currency transactions

(155)

(584)

Gains (Losses) on Extinguishment of Debt

0

2,399

Stock based compensation

259

337

Deferred income taxes

(2,167)

65

Tax receivable agreement liability adjustment

0

18,150

Increase (reduction) in tax uncertainty, net of valuation allowance

(144)

62

Other

32

138

Changes in operating assets and liabilities:

Accounts receivable, net

(5,844)

(9,134)

Inventories

(23,418)

(10,978)

Prepaid expenses and other assets

1,118

(255)

Accounts payable

9,414

(875)

Accrued expenses

(43,988)

(37,775)

Cash payments on restructuring liabilities

(23)

(668)

Other

82

137

Net cash used in operating activities

(50,637)

(48,546)

Cash flows from investing activities:

Capital expenditures

(8,418)

(7,732)

Proceeds from sale of assets

72

76

Net cash used in investing activities

(8,346)

(7,656)

Cash flows from financing activities:

Net revolver borrowings

30,000

10,000

Payments of long-term debt

(1,075)

(31,075)

Payments Related to Tax Withholding for Share-based Compensation

(1,186)

0

Proceeds from Stock Options Exercised

103

0

Net cash provided by (used in) financing activities

27,842

(21,075)

Impact of exchange rate movements on cash

205

2,193

Net decrease in cash and cash equivalents

(30,936)

(75,084)

Cash and cash equivalents at the beginning of the period

51,597

109,425

Cash and cash equivalents at the end of the period

$ 20,661

$ 34,341

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of Ply Gem Holdings, Inc. and its subsidiaries (referred to herein as “Ply Gem Holdings”, “Ply Gem”, the “Company”, “we”, “us”, or “our”) have been prepared in accordance with U.S. generally accepted accounting principles as described in the consolidated financial statements and related notes included in our 2016 Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 10, 2017. These statements do not include all of the information and footnotes required by U.S. generally accepted accounting principles and should be read in conjunction with our 2016 Annual Report on Form 10-K. In management’s opinion, all normal and recurring adjustments considered necessary for a fair presentation have been included. Operating results for the period from January 1, 2017 through April 1, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017.

The condensed consolidated balance sheet at December 31, 2016 has been derived from the audited consolidated financial statements of Ply Gem Holdings at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements.

The Company’s fiscal quarters are based on periods ending on the Saturday of the last week in the quarter. Therefore, the financial results of certain fiscal quarters will not be comparable to the prior and subsequent fiscal quarters. The accompanying financial statements include the Company’s condensed consolidated statements of operations and comprehensive income (loss) for the three months ended April 1, 2017 and April 2, 2016, the condensed consolidated statements of cash flows for the three months ended April 1, 2017 and April 2, 2016, and the condensed consolidated balance sheets as of April 1, 2017 and December 31, 2016.

Ply Gem is a diversified manufacturer of residential and commercial building products, which are sold primarily in the United States and Canada, and include a wide variety of products for the residential and commercial construction, the do-it-yourself and the professional remodeling and renovation markets. The demand for the Company’s products is seasonal, particularly in the Northeast and Midwest regions of the United States and Canada where inclement weather during the winter months usually reduces the level of building and remodeling activity in both the home repair and remodeling and new home construction sectors. The Company’s sales are usually lower during the first and fourth quarters.

To a significant extent our performance is dependent upon the levels of home repair and remodeling and new home construction spending, all of which are affected by such factors as interest rates, inflation, consumer confidence, unemployment, and availability of consumer credit.

Principles of Consolidation

The condensed consolidated financial statements include the accounts of Ply Gem Holdings and its subsidiaries, all of which are wholly owned. All intercompany accounts and transactions have been eliminated.

Accounting Policies and Use of Estimates

The preparation of these condensed consolidated financial statements in conformity with U.S. generally accepted accounting principles involves estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of income and expense during the reporting periods. Certain of the Company’s accounting policies require the application of judgment in selecting the appropriate assumptions for calculating financial estimates. By their nature, these judgments are subject to an inherent degree of uncertainty. The Company periodically evaluates the judgments and estimates used in their critical accounting policies to ensure that such judgments and estimates are reasonable. Such estimates include the allowance for doubtful accounts receivable, rebates, pensions, valuation of inventories, warranty reserves, insurance reserves, legal contingencies, assumptions used in the calculation of income taxes and the tax receivable agreement liability, projected cash flows used in the goodwill and intangible asset impairment tests, and environmental accruals and other contingencies. These judgments are based on the Company’s historical experience, current trends and information available from other sources, and are based on management’s best estimates and judgments. The Company adjusts such estimates and assumptions when facts and circumstances dictate. Volatile equity markets, foreign currency, and litigation risk have combined to increase the uncertainty inherent in such estimates and assumptions. If different conditions result from those assumptions used in the Company’s judgments, actual results could be materially different from the Company’s estimates.

Cash and Cash Equivalents

Cash equivalents consist of short-term highly liquid investments with original maturities of three months or less and which are readily convertible into cash.

Accounts Receivable

Accounts receivable-trade are recorded at their net realizable value. The allowance for doubtful accounts was $2.8 million at April 1, 2017 and $2.7 million at December 31, 2016. The Company maintains an allowance for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments. The Company estimates the allowance for doubtful accounts based on a variety of factors including the length of time receivables are past due, the financial health of its customers, unusual macroeconomic conditions and historical experience. If the financial condition of its customers deteriorates or other circumstances occur that result in an impairment of customers’ ability to make payments, the Company records additional allowances as needed. The Company writes off uncollectible trade accounts receivable against the allowance for doubtful accounts when collection efforts have been exhausted and/or any legal action taken by the Company has concluded.

Inventories

Inventories in the accompanying condensed consolidated balance sheets are valued at the lower of cost or net realizable value and are determined primarily by the first-in, first-out (FIFO) method. The Company records provisions, as appropriate, to write-down obsolete and excess inventory to estimated net realizable value. The process for evaluating obsolete and excess inventory often requires the Company to make subjective judgments and estimates concerning future sales levels, quantities and prices at which such inventory will be able to be sold in the normal course of business. Accelerating the disposal process or incorrect estimates of future sales potential may cause actual results to differ from the estimates at the time such inventory is disposed or sold. As of April 1, 2017, the Company had inventory purchase commitments of approximately $95.5 million.

Inventory provisions were approximately $8.5 million at April 1, 2017, increasing during the three months ended April 1, 2017 by $0.1 million compared to the December 31, 2016 provision balance of approximately $8.4 million.

Property and Equipment

Property and equipment are presented at cost. Depreciation of property and equipment are provided on a straight-line basis over estimated useful lives, which are generally as follows:



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

Expenditures for maintenance and repairs are expensed when incurred. Expenditures for renewals and betterments are capitalized. When assets are sold, or otherwise disposed, the cost and related accumulated depreciation are eliminated and the resulting gain or loss is recognized in operations.

Intangible Assets, Goodwill and Other Long-lived Assets

Long-lived assets

The Company reviews long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. The Company performs an undiscounted operating cash flow analysis to determine if impairment exists. If an impairment is determined to exist, any related impairment loss is calculated based on the asset’s fair value and the discounted cash flows.

The Company tests for long-lived asset impairment at the following asset group levels: (i) the combined U.S. Siding, Fencing and Stone companies in the Siding, Fencing and Stone segment (“Siding”), (ii) the combined U.S. Windows companies in the Windows and Doors segment (“U.S. Windows”), (iii) the combined Simonton windows companies in the Windows and Doors segment, (iv) Gienow Canada Inc. ("Gienow Canada") (a combined Western Canadian company created by the January 2014 amalgamation of the Company's legacy Western Canadian business and the Gienow entity acquired in April 2013) in the Windows and Doors segment, and (v) Mitten in the Siding, Fencing and Stone segment. For purposes of recognition and measurement of an impairment loss, a long-lived asset or asset group should represent the lowest level for which an entity can separately identify cash flows that are largely independent of the cash flows of other assets and liabilities. There were no indicators of impairment during the three months ended April 1, 2017.

Goodwill and other intangible assets

The Company evaluates goodwill for impairment on an annual basis and whenever events or business conditions warrant. All other intangible assets are amortized over their estimated useful lives and are assessed for impairment as necessary. The Company assesses goodwill for impairment at the November month end each year and also at any other date when events or changes in circumstances indicate that the carrying value of these assets may exceed their fair value. To evaluate goodwill for impairment, the Company estimates the fair value of reporting units considering such factors as discounted cash flows and valuation multiples for comparable publicly traded companies. A significant reduction in projected sales and earnings, which would lead to a reduction in future cash flows, could indicate potential impairment. There were no indicators of impairment during the three months ended April 1, 2017 that would trigger an interim impairment test. The Company will continue to evaluate goodwill during future periods and future declines in the residential housing and repair and remodeling markets could result in goodwill impairments.

Debt Issuance Costs

Debt issuance costs, composed of facility, agency, and certain legal fees associated with issuing new debt financing, are amortized over the contractual term of the related agreement using the effective interest method. Net debt issuance costs totaled approximately $15.7 million and $16.5 million as of April 1, 2017 and December 31, 2016, respectively, and have been recorded within long-term debt ($13.5 million at April 1, 2017 and $14.2 million at December 31, 2016) and other non-current assets ($2.2 million at April 1, 2017 and $2.3 million at December 31, 2016) in the accompanying condensed consolidated balance sheets. The debt issuance costs included in other long term assets relate to the Senior Secured Asset Based Revolving Credit Facility due 2020 ("ABL Facility"). Amortization of debt issuance costs for the three months ended April 1, 2017 and April 2, 2016 was approximately $0.8 million and $0.8 million, respectively. Amortization of debt issuance costs is recorded in interest expense in the accompanying condensed consolidated statements of operations and comprehensive income (loss).

Income Taxes

The Company utilizes the asset and liability method of accounting for income taxes which requires that deferred tax assets and liabilities be recorded to reflect the future tax consequences of temporary differences between the book and tax basis of various assets and liabilities. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of changes in tax rates on deferred tax assets and liabilities is recognized as income or expense in the period in which the rate change occurs. A valuation allowance is established to offset any deferred tax assets if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

Estimates are required with respect to, among other things, the appropriate state income tax rates used in the various states that the Company and its subsidiaries are required to file, the potential utilization of operating and capital loss carry-forwards for both federal and state income tax purposes and valuation allowances required, if any, for deferred tax assets that may not be realized in the future. The Company establishes reserves when, despite our belief that our tax return positions are fully supportable, certain positions could be challenged, and the positions may not be fully sustained. The Company, along with its U.S. subsidiaries, file a consolidated federal income tax return, separate state income tax returns, combined state returns, and unitary state returns. Gienow Canada and Mitten both file separate Canadian federal income tax returns and separate provincial returns.

Tax receivable agreement ("TRA") liability

The TRA liability generally provides for the payment by the Company to the Tax Receivable Entity of 85% of the amount of cash savings, if any, in the U.S. federal, state and local income tax that the Company actually realizes in periods ending after the Company's initial public offering as a result of (i) net operating loss carryovers ("NOLs") from periods ending before January 1, 2013, (ii) deductible expenses attributable to the initial public offering and (iii) deductions related to imputed interest. Since the inception of the TRA liability with the Company’s 2013 initial public offering through 2015, the Company had been in a full valuation allowance for federal purposes and had partial valuation allowances on certain state and Canadian jurisdictions. As a result of the Company’s tax valuation allowance position for federal and state purposes, the Company historically calculated the TRA liability considering (i) current year taxable income only (due to the uncertainty of future taxable income associated with the Company’s cumulative loss position) and (ii) future income due to the expected reversals of deferred tax liabilities. During the year ended December 31, 2016, the Company released its valuation allowance on its federal deferred tax assets and certain state deferred tax assets for approximately $55.2 million due to positive factors outweighing negative evidence thereby allowing the Company to achieve the “more likely than not” realization threshold. The factors surrounding the release of this valuation allowance thereby eliminated any uncertainty as to future taxable income. Consequently, for purposes of calculating the TRA liability, the Company during the year ended December 31, 2016 utilized future forecasts of taxable income beyond the 2016 tax year to determine the TRA liability. The Company’s future taxable income estimate was used to determine the cumulative NOLs that are expected to be utilized and the TRA liability was accordingly adjusted using the 85% TRA rate as the Company retains the benefit of 15% of the tax savings.

Environmental

The Company accrues for losses associated with environmental remediation obligations when such losses are probable and reasonably estimable. Environmental remediation obligation accruals are adjusted as further information develops or circumstances change. Costs of future expenditures for environmental remediation obligations are not discounted to their present value. Recoveries of environmental remediation costs from other parties are recorded as assets when their receipt is deemed probable.

Commitments and Contingencies

The Company accrues for all direct costs associated with the estimated resolution of contingencies at the earliest date at which it is deemed probable that a liability has been incurred and the amount of such liability can be reasonably estimated. Costs accrued have been estimated based upon an analysis of potential results, assuming a combination of litigation and settlement strategies and outcomes. Insurance recoveries are recorded as assets when their receipt is deemed probable.

Foreign Currency

Gienow Canada and Mitten, the Company’s Canadian subsidiaries, utilize the Canadian dollar as their functional currency. For reporting purposes, the Company translates the assets and liabilities of its foreign entities at the exchange rates in effect at period-end. Net sales and expenses are translated using average exchange rates in effect during the period. Gains and losses from foreign currency translation are credited or charged to accumulated other comprehensive income or loss in the accompanying condensed consolidated balance sheets.

The Company recorded a gain from foreign currency transactions of approximately $0.2 million and $0.6 million for the three months ended April 1, 2017 and April 2, 2016, respectively. During the three months ended April 1, 2017, accumulated other comprehensive income (loss) included a currency translation gain of approximately $0.6 million and a gain of approximately $4.8 million for the three months ended April 2, 2016.

Derivative Financial Instruments

As of April 1, 2017, the Company had entered into foreign currency forward contract agreements to hedge approximately $31.7 million of its 2017 non-functional currency inventory purchases to protect the Company from variability in cash flows attributable to changes in the U.S. dollar relative to the Canadian dollar.

The Company has designated these forward contracts as cash flow hedges. As a cash flow hedge, unrealized gains are recognized as assets while unrealized losses are recognized as liabilities. These forward contract agreements are highly correlated to the changes in foreign currency rates to which the Company is exposed. Unrealized gains and losses on these agreements are designated as effective or ineffective. The effective portion of such gains or losses is recorded as a component of accumulated other comprehensive income or loss, while the ineffective portion of such gains or losses is recorded as a component of cost of goods sold. Future realized gains and losses in connection with each inventory purchase will be reclassified from accumulated other comprehensive income or loss to cost of goods sold.

The changes in fair values of derivatives that have been designated and qualify as cash flow hedges are recorded in accumulated other comprehensive income or loss and are reclassified into cost of goods sold in the same period the hedged item affects earnings. Due to the high degree of effectiveness between the hedging instruments and the underlying exposures being hedged, fluctuations in the value of the derivative instrument are generally offset by changes in the fair value or cash flows of the underlying exposures being hedged. The changes in the fair value of derivatives that do not qualify as effective are immediately recognized in earnings.

The gains and losses on derivative contracts that are reclassified from accumulated other comprehensive income or loss to current period earnings are included in the line item in which the hedged item is recorded in the same period the forecasted transaction affects earnings. As of April 1, 2017, approximately $0.5 million of the deferred net asset on derivative instruments included in accumulated other comprehensive loss is expected to be reclassified to cost of goods sold during the next twelve months. This expectation is based on the expected timing of the occurrence of the hedged forecasted transactions. During the three months ended April 1, 2017, the Company recognized $0.1 million, within earnings as a reduction to cost of goods sold in the condensed consolidated statement of operations and comprehensive income (loss). During three months ended April 2, 2016, the Company recognized $0.4 million, within earnings as a reduction of cost of goods sold in the condensed consolidated statement of operations and comprehensive income (loss).

The fair value of the foreign currency forward contract agreements are estimated using industry standard valuation models using market-based observable inputs, including spot rates, forward points, interest rates and volatility inputs (Level 2). A summary of the recorded asset and liability included in the accompanying condensed consolidated balance sheets is as follows:



(Amounts in thousands)	April 1, 2017		December 31, 2016
Foreign currency hedge included in other current assets	$	471	$	962

Fair Value Measurement

The accounting standard for fair value discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flows), and the cost approach (cost to replace the service capacity of an asset or replacement cost). The standard utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:


•	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.

The hierarchy requires the use of observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. The fair value of the long-term debt instruments was determined by utilizing available market information. The carrying value of the Company’s other assets and liabilities approximates their fair value. The Company’s population of recurring financial assets and liabilities subject to fair value measurements and the necessary disclosures are as follows:



					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	$	676,000	$	676,000	$	—	$	—
Term Loan Facility	257,100		257,743		—		257,743		—
As of April 1, 2017	$	907,100	$	933,743	$	676,000	$	257,743	$	—
Liabilities:
Senior Notes-6.50%	$	650,000	$	676,000	$	676,000	$	—	$	—
Term Loan Facility	258,175		260,757		—		260,757		—
As of December 31, 2016	$	908,175	$	936,757	$	676,000	$	260,757	$	—

Earnings (Loss) Per Common Share

Basic earnings (loss) per share ("EPS") is computed based upon weighted-average shares outstanding during the period. Dilutive earnings per share is computed consistently with the basic computation while giving effect to all dilutive potential common shares and common share equivalents that were outstanding during the period. Ply Gem Holdings uses the treasury stock method to reflect the potential dilutive effect of unvested stock awards and unexercised options.

The computation of the dilutive effect of other potential common shares excluded options and unvested restricted stock representing approximately 0.6 million shares of common stock for the three months ended April 1, 2017. The computation of the dilutive effect of other potential common shares excluded options and unvested restricted stock representing approximately 0.1 million shares of common stock for the three months ended April 2, 2016.

New Accounting Pronouncements

In March 2017, the Financial Accounting Standards Board (“FASB”) issued ASU 2017-07, Compensation-Retirement Benefits (Topic 715) Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. ASU 2017-07 changes the statement of operations presentation of defined benefit plan expense by requiring separation between operating expense (service cost component) and non-operating expense (all other components, including interest cost, amortization of prior service cost, curtailments and settlements, etc.). The operating expense component is reported with similar compensation costs while the non-operating components are reported in other income and expense. In addition, only the service cost component is eligible for capitalization as part of an asset such as inventory or property, plant and equipment. ASU 2017-07 is effective for annual reporting periods, and interim periods therein, beginning after December 15, 2017 or fiscal 2018 for the Company. The Company is currently assessing the impact that adopting this new accounting standard will have on its consolidated financial statements.

Effective January 1, 2017, the Company adopted ASU 2016-09, Improvements to Employee Share-Based Payment Accounting. The standard update simplifies several aspects of the accounting for employee share-based payment transactions, including accounting for income taxes, forfeitures, and statutory withholding requirements, as well as classification in the condensed consolidated statements of cash flows. As a result of the adoption, on a modified retrospective basis, we recognized $1.3 million of excess tax benefits from stock-based compensation through a cumulative-effect adjustment decreasing accumulated deficit. We elected not to change our policy on accounting for forfeitures and will continue to estimate a requisite forfeiture rate. Additional amendments to the accounting for income taxes and minimum statutory withholding requirements had no impact on the Company's results of operations.

GOODWILL

The Company records the excess of the fair value of the acquisition consideration over the net tangible and intangible assets of acquired companies as goodwill. The Company performs an annual test for goodwill impairment at the November month end each year and also at any other date when events or changes in circumstances indicate that the carrying value of these assets may exceed their fair value. The Company has defined its reporting units and performs the impairment testing of goodwill at the operating segment level. The Company has two reporting units: (1) Siding, Fencing and Stone and (2) Windows and Doors. Separate valuations are performed for each of these reporting units in order to test for impairment.

The Company early adopted ASU No. 2017-04, Intangibles-Goodwill and other (Topic 350) during the three months ended April 1, 2017. As such, the Company measures the goodwill impairment as the amount by which the reporting unit's carrying value exceeds its fair value not to exceed the carrying amount of goodwill in a reporting unit. The Company has elected not to utilize the qualitative Step Zero impairment assessment. There was no goodwill impairment for the year ended December 31, 2016 and no impairment indicators which would trigger an interim impairment test during the three months ended April 1, 2017. However, the Company will continue to evaluate goodwill during future periods and future declines in the residential housing and repair and remodeling markets or the Company's market capitalization could result in goodwill impairments.

To determine the fair value of its reporting units, the Company equally considers both the income and market valuation methodologies. The income valuation methodology uses the fair value of the cash flows that the reporting unit can be expected to generate in the future. This method requires management to project revenues, operating expenses, working capital investment, capital spending and cash flows for the reporting unit over a multi-year period as well as determine the weighted average cost of capital to be used as the discount rate. The Company also utilizes the market valuation method to estimate the fair value of the reporting units by utilizing comparable public company multiples. These comparable public company multiples are then applied to the reporting unit’s financial performance. The market approach is more volatile as an indicator of fair value as compared to the income approach as internal forecasts and projections have historically been more stable. Since each approach has its merits, the Company equally weights the approaches to balance the internal and external factors affecting the Company’s fair value.

The Company’s fair value estimates of its reporting units and goodwill are sensitive to a number of assumptions including discount rates, cash flow projections, operating margins, and comparable market multiples. In order to accurately forecast future cash flows, the Company estimates single family housing starts and the repair and remodeling market's growth rates. However, there is no assurance that: (1) valuation multiples will not decline, (2) discount rates will not increase, or (3) the earnings, book values or projected earnings and cash flows of the Company's reporting units will not decline.

The reporting unit goodwill balances were as follows as of April 1, 2017 and December 31, 2016:



(Amounts in thousands)
	April 1, 2017		December 31, 2016
Siding, Fencing and Stone	$	348,745	$	348,553
Windows and Doors	130,050		129,961
	$	478,795	$	478,514

The changes in the goodwill balances from December 31, 2016 to April 1, 2017 relate to currency translation. A goodwill rollforward for 2017 is included in the table below:



	Windows and			Siding, Fencing
(Amounts in thousands)	Doors			and Stone
Balance as of December 31, 2016
Goodwill	$	457,734		$	470,780
Accumulated impairment losses	(327,773		)	(122,227		)
	$	129,961		$	348,553
Currency translation adjustments	89			192
Balance as of April 1, 2017
Goodwill	457,823			470,972
Accumulated impairment losses	(327,773		)	(122,227		)
	$	130,050		$	348,745

INTANGIBLE ASSETS

INTANGIBLE ASSETS, NET

The table that follows presents the major components of intangible assets as of April 1, 2017 and December 31, 2016:



(Amounts in thousands)	Average Amortization Period			Accumulated			Net Carrying
	(in Years)	Cost		Amortization			Value
As of April 1, 2017:
Patents	14	$	12,770	$	(12,199	)	$	571
Trademarks/Tradenames	12	117,142		(84,227		)	32,915
Customer relationships	13	218,108		(153,270		)	64,838
Other	4	5,665		(5,047		)	618
Total intangible assets	12	$	353,685	$	(254,743	)	$	98,942

As of December 31, 2016:
Patents	14	$	12,770	$	(12,078	)	$	692
Trademarks/Tradenames	12	117,124		(82,723		)	34,401
Customer relationships	13	217,861		(150,310		)	67,551
Other	4	5,661		(4,146		)	1,515
Total intangible assets	12	$	353,416	$	(249,257	)	$	104,159

Amortization expense for the three months ended April 1, 2017 and April 2, 2016 was $5.3 million and $6.4 million, respectively. Estimated amortization expense for the fiscal years 2017 through 2021 is shown in the following table:



	Amortization
(Amounts in thousands)	expense

2017 (remainder of year)	$	15,414
2018	19,935
2019	15,829
2020	11,150
2021	6,709

COMPREHENSIVE INCOME (LOSS)

Comprehensive income (loss), net of tax is comprised of the following:



(Amounts in thousands)	For the three months ended
	April 1, 2017			April 2, 2016
Net loss	$	(3,637	)	$	(27,577	)
Foreign currency translation adjustment	565			4,773
Unrealized loss on derivative instruments	(546		)	(1,720		)
Comprehensive loss	$	(3,618	)	$	(24,524	)

LONG-TERM DEBT

Long-term Debt [Text Block]

LONG-TERM DEBT

Long-term debt in the accompanying condensed consolidated balance sheets at April 1, 2017 and December 31, 2016 consists of the following:



(Amounts in thousands)
	April 1, 2017			December 31, 2016
Senior secured asset based revolving credit facility	$	30,000		$	—
Term Loan due 2021, net of unamortized early tender premium,
discount, and debt issuance costs of $16,536 and $17,854, respectively	240,564			240,321
6.50% Senior notes due 2022, net of unamortized early tender premium,
discount, and debt issuance costs of $47,926 and $49,935, respectively	602,074			600,065
	$	872,638		$	840,386
Less current portion of long-term debt	(4,300		)	(4,300		)
	$	868,338		$	836,086

6.50% Senior Notes due 2022

On January 30, 2014, Ply Gem Industries issued $500.0 million aggregate principal amount of 6.50% Senior Notes due 2022 (the "6.50% Senior Notes") at par. On September 19, 2014, Ply Gem Industries issued an additional $150.0 million aggregate principal amount of 6.50% Senior Notes at an issue price of 93.25%. Interest accrues at 6.50% per annum and is paid semi-annually on February 1 and August 1 of each year. All issued and outstanding 6.50% Senior Notes are registered under the Securities Act. The 6.50% Senior Notes will mature on February 1, 2022. At any time on or after February 1, 2017, Ply Gem Industries may redeem the 6.50% Senior Notes, in whole or in part, at declining redemption prices set forth in the indenture governing the 6.50% Senior Notes plus, in each case, accrued and unpaid interest, if any, to the redemption date. The effective interest rate for the 6.50% Senior Notes is 8.39% after considering each of the different interest expense components of this instrument, including the coupon payment and the deferred debt issuance costs.

The 6.50% Senior Notes are fully and unconditionally and jointly and severally guaranteed on a senior unsecured basis by Ply Gem Holdings and all of the wholly-owned domestic subsidiaries of Ply Gem Industries (the “Guarantors”). The indenture governing the 6.50% Senior Notes contains certain covenants that limit the ability of Ply Gem Industries and its restricted subsidiaries to incur additional indebtedness, pay dividends or make other distributions or repurchase or redeem their stock, make loans and investments, sell assets, incur certain liens, enter into agreements restricting their ability to pay dividends, enter into transactions with affiliates, and consolidate, merge or sell assets. In particular, Ply Gem Industries and its restricted subsidiaries may not incur additional debt (other than permitted debt (as defined in the indenture) in limited circumstances) unless, after giving effect to such incurrence, the consolidated interest coverage ratio of Ply Gem Industries would be at least 2.00 to 1.00.

In the absence of satisfying the consolidated interest coverage ratio test, Ply Gem Industries and its restricted subsidiaries may only incur additional debt under certain circumstances, including, but not limited to, debt under credit facilities (as defined in the indenture) (x) in an amount not to exceed the greater of (a) $350.0 million and (b) the borrowing base (as defined in the indenture) and (y) in an amount not to exceed the greater of (A) $575.0 million and (B) the aggregate amount of indebtedness (as defined in the indenture) that would cause the consolidated secured debt ratio (as defined in the indenture) to be equal to 4.00 to 1.00; purchase money indebtedness in an aggregate amount not to exceed the greater of (x) $35.0 million and (y) 10% of consolidated net tangible assets (as defined in the indenture) at any one time outstanding; debt of foreign subsidiaries in an aggregate amount not to exceed the greater of (x) $60.0 million and (y) 15% of consolidated net tangible assets (as defined in the indenture) at any one time outstanding; debt pursuant to a general basket in an aggregate amount at any one time outstanding not to exceed the greater of (x) $75.0 million and (y) 20% of consolidated net tangible assets; and the refinancing of debt under certain circumstances.

Term Loan Facility due 2021

On January 30, 2014, Ply Gem Industries entered into a credit agreement governing the terms of its $430.0 million Term Loan Facility. Ply Gem Industries originally borrowed $430.0 million under the Term Loan Facility on January 30, 2014, with an original discount of approximately $2.2 million, yielding proceeds of approximately $427.9 million. The Term Loan Facility will mature on January 30, 2021. The Term Loan Facility requires scheduled quarterly payments in an aggregate annual amount equal to 1.00% of the original aggregate principal amount of the Term Loan Facility with the balance due at maturity. Interest on outstanding borrowings under the Term Loan Facility is paid quarterly.

Borrowings under the Term Loan Facility bear interest at a rate equal to, at Ply Gem Industries’ option, either (a) a base rate determined by reference to the highest of (i) the prime rate of the administrative agent under the credit agreement, (ii) the federal funds rate plus 0.50% and (iii) the adjusted LIBO rate for a one-month interest period plus 1.00% or (b) a LIBO rate determined by reference to the cost of funds for eurocurrency deposits in dollars for the interest period relevant to such borrowing, adjusted for certain additional costs, subject to a 1.00% floor, plus, in each case, an applicable margin of 3.00% for any eurocurrency loan and 2.00% for any alternate base rate loan. As of April 1, 2017, the Company's interest rate on the Term Loan Facility was 4.00%. The effective interest rate for the Term Loan is 8.78% after considering each of the different interest expense components of this instrument, including the coupon payment, the deferred debt issuance costs and the original issue discount.

The Term Loan Facility allows Ply Gem Industries to request one or more incremental term loan facilities in an aggregate amount not to exceed the greater of (x) $140.0 million and (y) an amount such that Ply Gem Industries’ consolidated senior secured debt ratio (as defined in the credit agreement), on a pro forma basis, does not exceed 3.75 to 1.00, in each case, subject to certain conditions and receipt of commitments by existing or additional financial institutions or institutional lenders.

The Term Loan Facility requires Ply Gem Industries to prepay outstanding term loans, subject to certain exceptions, with: (i) 50% (which percentage will be reduced to 25% if our consolidated senior secured debt ratio is equal or less than 2.50 to 1.00 but greater than 2.00 to 1.00 and to 0% if our consolidated senior secured debt ratio is equal to or less than 2.00 to 1.00) of our annual excess cash flow (as defined in the credit agreement), to the extent such excess cash flow exceeds $15.0 million; (ii) 100% of the net cash proceeds of certain non-ordinary course asset sales or certain insurance and condemnation proceeds, in each case subject to certain exceptions and reinvestment rights; and (iii) 100% of the net cash proceeds of certain issuances of debt, other than proceeds from debt permitted under the Term Loan Facility. Ply Gem Industries may voluntarily repay outstanding loans under the Term Loan Facility at any time without premium or penalty, other than customary “breakage” costs with respect to LIBOR loans. As of and for the year ended December 31, 2016, the Company's consolidated senior secured debt ratio was 0.93 and as a result no excess cash flow payment under the Term Loan Facility was required in 2017. The Company elected on March 10, 2016 and August 4, 2016 to voluntarily prepay $30.0 million on each date on the Term Loan Facility to reduce its outstanding indebtedness. The Company further elected on November 4, 2016 to voluntarily pay an additional $100.0 million on the Term Loan Facility to further reduce its outstanding indebtedness bringing our cumulative voluntary 2016 Term Loan Facility payments to $160.0 million.

The Term Loan Facility is secured on a first-priority lien basis by the stock of Ply Gem Industries and by substantially all of the assets (other than the assets securing the obligations under the ABL Facility, which primarily consist of accounts receivable, inventory, cash, deposit accounts, securities accounts, chattel paper, contract rights, instruments, documents related thereto and proceeds of the foregoing) of Ply Gem Industries and the Guarantors that are subsidiaries of Ply Gem Industries and on a second-priority lien basis by the assets that secure the ABL Facility.

The Term Loan Facility includes negative covenants, subject to certain exceptions, that are substantially the same as the negative covenants in the 6.50% Senior Notes but does not contain any restrictive financial covenants. The Term Loan Facility also restricts the ability of Ply Gem Industries’ subsidiaries to enter into agreements restricting their ability to grant liens to secure the Term Loan Facility and contains a restriction on changes in fiscal year.

Senior Secured Asset Based Revolving Credit Facility due 2020

On November 5, 2015, Ply Gem Holdings, Inc., Ply Gem Industries, Inc., Gienow Canada Inc., and Mitten Inc. (together with Gienow, the “Canadian Borrowers”) entered into a second amended and restated credit agreement governing the ABL Facility. Among other things, the second amendment and restatement of the credit agreement governing the ABL Facility: (i) increased the overall facility to $350.0 million from $300.0 million, (ii) established an accordion feature of $50.0 million, (iii) reduced the applicable margin for borrowings under the ABL Facility to a range from 1.25% to 2.00% for Eurodollar rate loans, depending on availability, and (iv) extended the maturity until November 5, 2020. Under the ABL Facility, $300.0 million is available to Ply Gem Industries and $50.0 million is available to the Canadian Borrowers. The following summary describes the ABL Facility after giving effect to the second amendment and restatement. As a result of the November 2015 ABL Facility amendment in which the loan syndication consisted of previous members who either maintained or increased their position as well as new syndication members, the Company capitalized new debt issuance costs of $1.5 million and amortizes these costs through 2020.

Borrowings under the ABL Facility bear interest at a rate per annum equal to, at Ply Gem Industries’ option, either (a) a base rate determined by reference to the higher of (1) the corporate base rate of the administrative agent under the ABL Facility and (2) the federal funds rate plus 0.5% or (b) a Eurodollar rate determined by reference to the costs of funds for U.S. dollar deposits for the interest period relevant to such borrowing adjusted for certain additional costs, in each case plus an applicable margin. The initial applicable margin for borrowings under the ABL Facility was 0.50% for base rate loans and 1.50% for Eurodollar rate loans. The applicable margin for borrowings under the ABL Facility is subject to step ups and step downs based on average excess availability under the ABL Facility. Swingline loans bear interest at a rate per annum equal to the base rate plus the applicable margin.

In addition to paying interest on outstanding principal under the ABL Facility, Ply Gem Industries is required to pay a commitment fee in respect of the unutilized commitments thereunder, which fee will be determined based on utilization of the ABL Facility (increasing when utilization is low and decreasing when utilization is high) multiplied by a commitment fee rate determined by reference to average excess availability under the ABL Facility. The commitment fee rate during any fiscal quarter is 0.375% when average excess availability is greater than $100.0 million for the preceding fiscal quarter and 0.25% when average availability is less than or equal to $100.0 million for the preceding fiscal quarter. Ply Gem Industries must also pay customary letter of credit fees equal to the applicable margin on Eurodollar loans and agency fees. As of April 1, 2017, the Company’s interest rate on the ABL Facility was approximately 2.32%. The ABL Facility requires that if (a) excess availability is less than the greater of (x) 10.0% of the lower of the borrowing base and the aggregate commitments and (y) $25.0 million or (b) any event of default has occurred and is continuing, Ply Gem Industries must comply with a minimum fixed charge coverage ratio test of 1.0 to 1.0. If the excess availability under the ABL Facility is less than the greater of (a) 12.5% of the lesser of the borrowing base and the aggregate commitments and (b) $30.0 million ($27.5 million for the months of January, February, March and April) for a period of 5 consecutive days or an event of default has occurred and is continuing, all cash from Ply Gem Industries material deposit accounts (including all concentration accounts) will be swept daily into a collection account controlled by the administrative agent under the ABL Facility and used to repay outstanding loans and cash collateralize letters of credit.

All obligations under the ABL Facility are unconditionally guaranteed by Ply Gem Holdings and substantially all of Ply Gem Industries’ existing and future, direct and indirect, wholly owned domestic subsidiaries. All obligations under the ABL Facility, and the guarantees of those obligations, are secured, subject to certain exceptions, by substantially all of the assets of Ply Gem Industries and the guarantors, including a first-priority security interest in personal property consisting of accounts receivable, inventory, cash, deposit accounts, and certain related assets and proceeds of the foregoing and a second-priority security interest in, and mortgages on, substantially all of Ply Gem Industries’ and the Guarantors’ material owned real property and equipment and all assets that secure the Term Loan Facility on a first-priority basis. In addition to being secured by the collateral securing the obligations of Ply Gem Industries under the domestic collateral package, the obligations of the Canadian Borrowers, which are borrowers under the Canadian sub-facility under the ABL Facility, are also secured by a first-priority security interest in substantially all of the assets of such Canadian subsidiaries, plus additional mortgages in Canada, and a pledge by Ply Gem Industries of the remaining 35% of the equity interests of the Canadian Borrowers pledged only to secure the Canadian sub-facility.

The ABL Facility contains certain covenants that limit Ply Gem Industries’ ability and the ability of Ply Gem Industries’ subsidiaries to incur additional indebtedness, pay dividends or make other distributions or repurchase or redeem their stock, make loans and investments, sell assets, incur certain liens, enter into transactions with affiliates, and consolidate, merge or sell assets.

As of April 1, 2017, Ply Gem Industries had approximately $310.3 million of contractual availability and approximately $207.3 million of borrowing base availability under the ABL Facility, reflecting $30.0 million of borrowings outstanding and approximately $9.7 million of letters of credit and priority payables reserves.

Loss on debt modification or extinguishment

During March 2016, the Company made a voluntarily payment of $30.0 million on the Term Loan Facility to reduce its outstanding indebtedness as allowable under the terms of the Term Loan Facility. The Company performed an analysis to determine the proper accounting treatment for this voluntary payment by evaluating the change in cash flows and determined that there were no changes in creditors as a result of the payment. Consequently, the Company recognized a loss on debt modification or extinguishment of approximately $2.4 million for the three months ended April 2, 2016, reflecting the proportionate write-off of the related debt discount and debt issuance costs associated with the $30.0 million payment, as summarized in the table below.



(Amounts in thousands)	For the three months ended
	April 1, 2017		April 2, 2016
Loss on modification of debt:
Term Loan Facility unamortized discount	$	—	$	1,915
Term Loan Facility unamortized debt issuance costs	—		484
Total loss on modification or extinguishment of debt	$	—	$	2,399

PENSION PLANS

The Company has two pension plans, the Ply Gem Group Pension Plan and the MW Manufacturers, Inc. Retirement Plan. The Company’s net periodic benefit expense for the combined plans for the periods indicated consists of the following components:



(Amounts in thousands)	For the three months ended
	April 1, 2017			April 2, 2016
Service cost	$	—		$	—
Interest cost	459			486
Expected return on plan assets	(546		)	(545		)
Amortization of loss	351			354
Net periodic benefit expense	$	264		$	295

COMMITMENTS AND CONTINGENCIES

Indemnifications

In connection with the Ply Gem acquisition, in which Ply Gem Industries was acquired from Nortek, Inc. (“Nortek”) in February 2004, Nortek has agreed to indemnify the Company for certain liabilities as set forth in the stock purchase agreement governing the Ply Gem acquisition. In the event Nortek is unable to satisfy amounts due under these indemnifications, the Company would be liable. The Company believes that Nortek has the financial capacity to honor its indemnification obligations and therefore does not anticipate incurring any losses related to liabilities indemnified by Nortek under the stock purchase agreement. A receivable related to this indemnification has been recorded in other long-term assets of approximately $1.4 million and $1.4 million at April 1, 2017 and December 31, 2016, respectively. As of April 1, 2017 and December 31, 2016, the Company has recorded liabilities related to these indemnifications of approximately $0.5 million and $0.5 million, respectively, in current liabilities and $0.9 million and $0.9 million, respectively, in long-term liabilities, consisting of the following:



(Amounts in thousands)	April 1, 2017		December 31, 2016
Product claim liabilities	$	138	$	138
Multi-employer pension plan withdrawal liability	718		808
Other	497		500
	$	1,353	$	1,446

Warranty claims

The Company sells a number of products and offers a number of warranties. The specific terms and conditions of these warranties vary depending on the product sold. The Company estimates the costs that may be incurred under their warranties and records a liability for such costs at the time of sale. Factors that affect the Company’s warranty liabilities include the number of units sold, historical and anticipated rates of warranty claims, cost per claim and new product introduction. The Company assesses the adequacy of the recorded warranty claims and adjusts the amounts as necessary. As of April 1, 2017 and December 31, 2016, warranty liabilities of approximately $20.2 million and $19.7 million, respectively, have been recorded in current liabilities and approximately $58.3 million and $57.6 million, respectively, have been recorded in long term liabilities in the Company's condensed consolidated balance sheets.

Changes in the Company’s short-term and long-term warranty liabilities are as follows:



	For the three months ended
(Amounts in thousands)	April 1, 2017			April 2, 2016
Balance, beginning of period	$	77,293		$	76,562
Warranty expense during period	6,166			5,512
Settlements made during period	(5,008		)	(4,613		)
Balance, end of period	$	78,451		$	77,461

Environmental

The Company is subject to United States and Canadian federal, state, provincial and local laws and regulations relating to pollution and the protection of the environment, including those governing emissions to air, discharges to water, use, storage and transport of hazardous materials, storage, treatment and disposal of waste, remediation of contaminated sites, and protection of worker health and safety. From time to time, the Company's facilities are subject to investigation by governmental regulators. In addition, the Company has been identified as one of many potentially responsible parties for contamination present at certain offsite locations to which it or its predecessors are alleged to have sent hazardous materials for recycling or disposal. The Company may be held liable, or incur fines or penalties, in connection with such requirements or liabilities for, among other things, releases of hazardous substances occurring on or emanating from current or formerly owned or operated properties or any associated offsite disposal location, or for known or newly-discovered contamination at any of the Company's properties from activities conducted by us or previous occupants. The amount of any liability, fine or penalty may be material, and certain environmental laws impose strict, and under certain circumstances joint and several, liability for the cost of addressing releases of hazardous substances upon certain classes of persons, including site owners or operators and persons that disposed or arranged for the disposal of hazardous substances at contaminated sites.

MW Manufacturers Inc. (“MW”), a subsidiary of MWM Holding, Inc., entered into an Administrative Order on Consent (the “Consent Order”), effective September 12, 2011, with the United States Environmental Protection Agency (“EPA”), Region III, under Section 3008(h) of the Resource Conservation and Recovery Act ("RCRA"), with respect to its Rocky Mount, Virginia property. During 2011, as part of the Consent Order, MW provided the EPA, among other things, a RCRA Facility Investigation Workplan (the “Workplan”) as well as a preliminary cost estimate of approximately $1.8 million for the predicted assessment, remediation and monitoring activities to be conducted pursuant to the Consent Order over the remediation period, which is currently estimated through 2023. During 2012, the EPA approved the Workplan, and MW is currently implementing the Workplan. The Company has recorded approximately $0.3 million of this environmental liability within current liabilities and approximately $1.2 million within other long-term liabilities in the Company’s condensed consolidated balance sheets at April 1, 2017 and December 31, 2016. The Company will adjust this environmental remediation liability in future periods, if necessary, as further information develops or circumstances change.

Certain liabilities with respect to this contamination relate to the previous closure of an underground storage tank and were assumed by U.S. Industries, Inc., pursuant to its indemnity obligation under the stock purchase agreement dated August 11, 1995, whereby U.S. Industries, Inc. sold the stock of MW to FPI Acquisition Corp. (“Fenway Partners”). As the successor-in-interest of Fenway Partners, the Company is similarly indemnified by U.S. Industries, Inc. Notwithstanding this indemnity, however, under applicable Federal and State laws, MW, and the Company as its parent, could be held liable for all or part of the costs associated with the matter under certain circumstances. Moreover, the Company’s ability to seek indemnification from U.S. Industries, Inc. is limited by the terms and limits of the indemnity as well as the strength of U.S. Industries, Inc.’s financial condition, which could change in the future. As of April 1, 2017, no recovery has been recognized on the Company’s condensed consolidated balance sheet, but the Company will actively pursue this indemnity in future periods and will recognize future recoveries in the period in which they become probable.

The State of Nebraska is investigating certain groundwater contamination in northern York, Nebraska, comprised primarily of volatile organic compounds (VOC) (predominantly trichloroethene (TCE)). In December 2013, the EPA announced its proposal to add this groundwater contamination site to the Superfund National Priorities List (NPL) after it was referred to the EPA by the State of Nebraska. Sampling was conducted at the Kroy Building Products, Inc. (“Kroy”) facility in York, Nebraska during the first quarter of 2010. In February 2015, the EPA sent a request for information pursuant to Section 104 of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), and Kroy has responded to this request for information. Given the preliminary stage of this matter, the Company has not recorded a liability for this matter in its condensed consolidated balance sheet as of April 1, 2017. Alcan Aluminum Corporation (“Alcan”) has assumed the obligation to indemnify the Company with respect to certain liabilities for environmental contamination of the Kroy facility occurring prior to 1994. Notwithstanding this indemnity, however, under applicable Federal and State laws, Kroy, and Ply Gem as its parent, could be held liable for all or part of the costs associated with the matter under certain circumstances. Moreover, the ability of Kroy and Ply Gem to seek indemnification may be limited by the terms and limits of the indemnity as well as the strength of Alcan’s financial condition, which could change in the future.

The Company is currently involved in environmental proceedings involving Gienow Canada Inc. (f/k/a Ply Gem Canada, Inc.) and Alberta Environment (arising from subsurface contamination discovered at our Calgary, Alberta property) for which the Company has a $0.1 million liability included in its condensed consolidated balance sheet, and the Company may in the future be subject to environmental proceedings involving Thermal-Gard, Inc. (arising from groundwater contamination in Punxsutawney, Pennsylvania), Mastic Home Exteriors, Inc. (“MHE”) (relating to a closed landfill site in Sidney, Ohio as well as participating as a potentially responsible party in nine contaminated sites in Indiana, Ohio and South Carolina), and Simonton (relating to closed lagoons and certain contamination in Paris, Illinois as well as certain contamination associated with certain 7-Eleven convenience food stores). Under the stock purchase agreement governing the MHE acquisition, Alcoa Securities Corporation and Alcoa, Inc. are to indemnify the Company for certain environmental liabilities in excess of $2.5 million, including liabilities relating to the landfill site in Sidney, Ohio and the nine contaminated sites in Indiana, Ohio and South Carolina. Under the stock purchase agreement governing the Simonton acquisition, Fortune Brands Windows & Doors, Inc., is to indemnify the Company for any environmental claims associated with the 7-Eleven convenience food stores. The Company's ability to seek indemnification or enforce these and other obligations is, however, limited by the strength of the financial condition of the indemnitor or responsible party, which could change in the future, as well as the terms and limits of any such indemnities or obligations.

Based on current information, the Company is not aware of any compliance obligations, claims, releases or investigations that will have a material adverse effect on our results of operations, cash flows or financial position except as otherwise disclosed in the Company's condensed consolidated financial statements. However, there can be no guarantee that previously known or newly-discovered matters or any inability to enforce our available indemnification rights against previous owners of the Company, its subsidiaries, or their businesses or properties will not result in material costs or liabilities. While the purchase agreements governing certain of our acquisitions provide that the sellers will indemnify us, subject to certain limitations, for certain environmental liabilities, our ability to seek indemnification from the respective sellers is limited by various factors, including the financial condition of the indemnitor or responsible party as well as by the terms and limits of such indemnities or obligations. As a result, there can be no assurance that we could receive any indemnification from the sellers, and any related environmental liabilities, costs or penalties could have a material adverse effect on our financial condition and results of operations.

Self-insured risks

The Company maintains a broad range of insurance policies which include general liability insurance coverage and workers compensation. These insurance policies protect the Company against a portion of the risk of loss from claims. However, the Company retains a portion of the overall risk for such claims through its self-insured per occurrence and aggregate retentions, deductibles, and claims in excess of available insurance policy limits. The Company's general liability insurance includes coverage for certain damages arising out of product design and manufacturing defects. The Company's insurance coverage is generally subject to a per occurrence retention.

The Company reserves for costs associated with claims, as well as incurred but not reported losses (“IBNR”), based on an outside actuarial analysis of its historical claims. These estimates make up a significant portion of the Company's liability and are subject to a high degree of uncertainty due to a variety of factors, including changes in type of claims, claims reporting and resolution patterns, frequency and timing of claims, third party recoveries, estimates of claim values, claims management expenses (including legal fees and expert fees), insurance industry practices, the regulatory environment, and legal precedent. Adjustments to estimated reserves are recorded in the period in which the change in estimate occurs.

Litigation

During the past several years, the Company incurred increased litigation expense primarily related to the claims discussed below. The Company believes it has valid defenses to the outstanding claims discussed below and will vigorously defend all such claims; however, litigation is subject to many uncertainties and there cannot be any assurance that the Company will ultimately prevail or, in the event of an unfavorable outcome or settlement of litigation, that the ultimate liability would not be material and would not have a material adverse effect on the business, results of operations, cash flows or financial position of the Company.

In Anthony Pagliaroni et al. v. Mastic Home Exteriors, Inc. and Deceuninck North America, LLC, a purported class action filed in January 2012 in the United States District Court for the District of Massachusetts, plaintiffs, on behalf of themselves and all others similarly situated, allege damages as a result of the defective design and manufacture of Oasis composite deck and railing, which was manufactured by Deceuninck North America, LLC (“Deceuninck”) and sold by Mastic Home Exteriors, Inc. (“MHE”). The plaintiffs seek a variety of relief, including (i) economic and compensatory damages, (ii) treble damages, (iii) punitive damages, and (iv) attorneys' fees and costs of litigation. The damages sought in this action have not yet been quantified. The hearing regarding plaintiffs’ motion for class certification was held on March 10, 2015, and the District Court denied plaintiffs’ motion for class certification on September 22, 2015. On October, 6, 2015, plaintiffs filed a petition for interlocutory appeal of the denial of class certification to the U.S. Court of Appeals for the First Circuit, and on April 12, 2016, the Court of Appeals denied this petition for appeal. Deceuninck, as the manufacturer of Oasis deck and railing, has agreed to indemnify MHE for certain liabilities related to this claim pursuant to the sales and distribution agreement, as amended, between Deceuninck and MHE. MHE's ability to seek indemnification from Deceuninck is, however, limited by the terms and limits of the indemnity as well as the strength of Deceuninck's financial condition, which could change in the future.

In re Ply Gem Holdings, Inc. Securities Litigation is a purported federal securities class action filed on May 19, 2014 in the United States District Court for the Southern District of New York against Ply Gem Holdings, Inc., several of its directors and officers, and the underwriters associated with the Company’s initial public offering ("IPO"). It is filed on behalf of all persons or entities, other than the defendants, who purchased the common shares of the Company pursuant and/or traceable to the Company’s IPO and seeks remedies under Sections 11 and 15 of the Securities Act of 1933, alleging that the Company’s Form S-1 registration statement was negligently prepared and materially inaccurate, containing untrue statements of material fact and omitting material information which was required to be disclosed. The plaintiffs seek a variety of relief, including (i) damages together with interest thereon and (ii) attorneys’ fees and costs of litigation. On October 14, 2014, Strathclyde Pension Fund was certified as lead plaintiff, and class counsel was appointed. On February 13, 2015, the defendants filed their motion to dismiss the complaint. On September 29, 2015, the District Court granted defendants’ motion to dismiss, but ruled that plaintiff could file an amended complaint. On November 6, 2015, plaintiff filed an amended complaint, and on January 13, 2016, the defendants filed their motion to dismiss this amended complaint. On September 23, 2016, the District Court granted in part and denied in part this motion to dismiss. On February 15, 2017, plaintiff filed a motion for class certification, and on April 17, 2017, the defendants filed their opposition to this motion. The motion is pending. The damages sought in this action have not yet been quantified. Pursuant to the Underwriting Agreement, dated May 22, 2013, entered into in connection with the IPO, the Company has agreed to reimburse the underwriters for the legal fees and other expenses reasonably incurred by the underwriters’ law firm in its representation of the underwriters in connection with this matter. Pursuant to Indemnification Agreements, dated as of May 22, 2013, between the Company and each of the directors and officers named in this action, the Company has agreed to assume the defense of such directors and officers. We believe the purported federal securities class action is without merit and will vigorously defend the lawsuit.

In Raul Carrillo-Hueso and Chec Xiong v. Ply Gem Industries, Inc. and Ply Gem Pacific Windows Corporation, a purported class action filed on November 25, 2015 in the Superior Court of the State of California, County of Alameda, plaintiffs, on behalf of themselves and all others similarly situated, allege damages as a result of, among other things, the defendants’ failure to provide (i) statutorily required meal breaks at the Sacramento, California facility, (ii) accurate wage statements to employees in California, and (iii) all wages due on termination in California. The plaintiffs seek a variety of relief, including (i) economic and compensatory damages, (ii) statutory damages, (iii) penalties, (iv) pre- and post-judgment interest, and (v) attorneys' fees and costs of litigation. On January 7, 2017, the parties agreed to settle this matter for approximately $1.0 million, subject to certain conditions including approval by the Court. The Company has accrued for this amount in accrued expenses as of April 1, 2017 and December 31, 2016 in the Company's consolidated balance sheets.

In Tina Morgan v. Ply Gem Industries, Inc. and Simonton Industries, Inc., a purported class action filed on December 11, 2015 in the Superior Court of the State of California, County of Solano, plaintiff, on behalf of herself and all others similarly situated, alleges damages as a result of, among other things, the defendants’ failure at the Vacaville, California facility to (i) pay overtime wages, (ii) provide statutorily required meal breaks, (iii) provide accurate wage statements, and (iv) pay all wages owed upon termination. The plaintiff seeks a variety of relief, including (i) economic and compensatory damages, (ii) statutory damages, (iii) penalties, (iv) pre- and post-judgment interest, and (v) attorneys' fees and costs of litigation. On December 9, 2016, the parties agreed to settle this matter for approximately $0.9 million, subject to certain conditions including approval by the Court. The Company has accrued for this amount in accrued expenses as of April 1, 2017 and December 31, 2016 in the Company's consolidated balance sheets.

In Kiefer et al. v. Simonton Building Products, LLC et al., a purported class action filed on October 17, 2016 in the United States District Court for the District of Minnesota, plaintiffs, on behalf of themselves and all others similarly situated, allege damages as a result of, among other things, the defective design and manufacture of certain Simonton windows containing two-pane insulating glass units. The plaintiffs seek a variety of relief, including (i) economic and compensatory damages, (ii) punitive or other exemplary damages, (iii) pre- and post-judgment interest, and (iv) attorneys' fees and costs of litigation. On April 17, 2017, the District Court granted the defendants’ motion to dismiss the complaint. The damages sought in this action have not yet been quantified.

Other contingencies

The Company is subject to other contingencies, including legal proceedings and claims arising out of its operations and businesses that cover a wide range of matters, including, among others, environmental, contract, employment, intellectual property, securities, personal injury, property damage, product liability, warranty, and modification, adjustment or replacement of component parts or units sold, which may include product recalls. Product liability, environmental and other legal proceedings also include matters with respect to businesses previously owned. The Company has used various substances in its products and manufacturing operations, which have been or may be deemed to be hazardous or dangerous, and the extent of its potential liability, if any, under environmental, product liability and workers’ compensation statutes, rules, regulations and case law is unclear. Further, due to the lack of adequate information and the potential impact of present regulations and any future regulations, there are certain circumstances in which no range of potential exposure may be reasonably estimated. Also, it is not possible to ascertain the ultimate legal and financial liability with respect to certain contingent liabilities, including lawsuits, and therefore no such estimate has been made as of April 1, 2017.

ACCRUED EXPENSES AND OTHER LONG-TERM LIABILITIES

Accrued expenses consist of the following at April 1, 2017 and December 31, 2016:



(Amounts in thousands)	April 1, 2017		December 31, 2016
Insurance	$	8,493	$	8,297
Employee compensation and benefits	17,384		27,749
Sales and marketing	29,140		59,655
Product warranty	20,189		19,718
Accrued freight	2,664		2,146
Accrued interest	7,286		17,977
Accrued environmental liability	435		434
Accrued pension	1,753		1,753
Accrued sales returns and discounts	1,418		1,199
Accrued taxes	5,605		4,966
Litigation accrual	2,575		2,575
Other	27,829		22,546
	$	124,771	$	169,015

Other long-term liabilities consist of the following at April 1, 2017 and December 31, 2016:



(Amounts in thousands)	April 1, 2017		December 31, 2016
Insurance	$	597	$	605
Pension liabilities	13,958		13,907
Multi-employer pension withdrawal liability	718		808
Product warranty	58,262		57,575
Long-term product claim liability	138		138
Long-term environmental liability	1,158		1,158
Liabilities for tax uncertainties	3,781		3,925
Litigation accrual	731		731
Other	4,757		7,548
	$	84,100	$	86,395

Long-term incentive plan

The Company has a long-term incentive plan (“LTIP”) for certain employees. The long-term incentive plan was implemented to retain and incentivize key employees. During the three months ended April 1, 2017 and April 2, 2016, the Company recognized a LTIP expense of $1.4 million and $1.7 million, respectively, which has been recorded within selling, general, and administrative expenses in the condensed consolidated statements of operations and comprehensive income (loss). The LTIP liability was $5.1 million and $10.0 million as of April 1, 2017 and December 31, 2016, respectively, of which $4.3 million and $6.3 million has been recorded within accrued expenses and $0.8 million and $3.7 million in other long-term liabilities in the condensed consolidated balance sheets, respectively. During the three months ended April 1, 2017, the Company issued 129,176 shares of its common stock based on a December 30, 2016 closing stock price of $16.25 to settle LTIP awards of $3.3 million. In connection with this settlement, the Company paid $1.2 million to tax authorities on behalf of these employees which has been recognized as a financing activity in the Company's condensed consolidated statement of cash flows for the three months ended April 1, 2017.

INCOME TAXES

Effective tax rate

Under FASB Accounting Standards Codification 740-270, Income Taxes - Interim Reporting, each interim period is considered an integral part of the annual period and tax expense is measured using an estimated annual effective tax rate. Estimates of the annual effective tax rate at the end of interim periods are, of necessity, based on evaluation of possible future events and transactions and may be subject to subsequent refinement or revision. The Company calculates its quarterly tax provision consistent with the guidance provided by ASC 740-270, whereby the Company forecasts its estimated annual effective tax rate then applies that rate to its year-to-date pre-tax book income (loss). In addition, we exclude jurisdictions with a projected loss for the year or the year-to-date loss where we cannot recognize a tax benefit from our estimated annual effective tax rate. The impact of such an exclusion could result in a higher or lower effective tax rate during a particular quarter, based upon the mix and timing of actual earnings versus annual projections. In addition to the tax resulting from applying the estimated annual effective tax rate to pre-tax income (loss), the Company includes certain items treated as discrete events to arrive at an estimated effective tax rate. Future changes in the forecasted annual income (loss) projections, tax rate changes, or discrete tax items could result in significant adjustments to quarterly income tax expense (benefit) in future periods in accordance with ASC 740-270.

For the three months ended April 1, 2017, the Company's estimated annual effective income tax rate was approximately 40.3%, which varied from the statutory rate primarily due to state income tax expense, valuation allowances, and foreign income taxes. The effective tax rate including discrete items, related to unrecognized tax benefits, stock compensation, and adjustments to state income tax rates, was 25.6% for the three months ended April 1, 2017. The tax benefit for the three months ended April 1, 2017 was approximately $1.3 million, and the tax benefit for the three months ended April 2, 2016 was approximately $1.5 million.

Valuation allowance

During the year ended December 31, 2016, the Company determined that a valuation allowance was no longer required against its federal net deferred tax assets and a portion of its state deferred tax assets. As a result, the Company released $86.5 million of its total valuation allowance during the year ended December 31, 2016 since positive evidence outweighed negative evidence thereby allowing the Company to achieve the “more likely than not” realization threshold. Of the total valuation allowance reversal of $86.5 million, $31.3 million was offset against 2016 current year tax expense with the remaining $55.2 million representing the discrete valuation allowance release.

The Company remains in a valuation allowance position against its deferred tax assets for certain state and Canadian jurisdictions as it is currently deemed "more likely than not" that the benefit of such net tax assets will not be utilized as the Company continues to be in a three-year cumulative loss position for these states and Canadian jurisdictions. The Company will continue to monitor the positive and negative factors for these jurisdictions and make further changes to the valuation allowances as necessary.

Unrecognized tax benefits

Despite the Company’s belief that its tax return positions are consistent with applicable tax laws, the Company believes that certain positions could be challenged by taxing authorities. The Company’s tax reserves reflect the difference between the tax benefit claimed on tax returns and the amount recognized in the condensed consolidated financial statements. These reserves have been established based on management’s assessment as to potential exposure attributable to permanent differences and interest and penalties applicable to both permanent and temporary differences. The tax reserves are reviewed periodically and adjusted in light of changing facts and circumstances, such as progress of tax audits, lapse of applicable statutes of limitations and changes in tax law. During the three months ended April 1, 2017, the tax reserves decreased by approximately $0.1 million, primarily related to the lapse of applicable statutes of limitation and partially offset by interest expense on remaining unrecognized tax benefits.

The liability for unrecognized tax benefits as of April 1, 2017 was approximately $3.8 million and is recorded in other long-term liabilities in the accompanying condensed consolidated balance sheets. The corresponding amount of gross unrecognized tax benefit was approximately $16.4 million. The difference between the total unrecognized tax benefits and the amount of the liability for unrecognized tax benefits represents unrecognized tax benefits that have been netted against deferred tax assets related to net operating losses in accordance with ASC 740 in addition to accrued penalties and interest.

Tax Receivable Agreement

On May 22, 2013, the Company entered into a Tax Receivable Agreement (the “Tax Receivable Agreement”) with PG ITR Holdco, L.P. (the “Tax Receivable Entity”). The Tax Receivable Agreement generally provides for the payment by the Company to the Tax Receivable Entity of 85% of the amount of cash savings, if any, in U.S. federal, state and local income tax that the Company actually realizes in periods ending after the IPO as a result of (i) NOL carryovers from periods (or portions thereof) ending before January 1, 2013, (ii) deductible expenses attributable to the transactions related to the IPO and (iii) deductions related to imputed interest deemed to be paid by the Company as a result of or attributable to payments under the Tax Receivable Agreement. The term of the Tax Receivable Agreement will continue until all such benefits have been utilized or expired. The Company will retain the benefit of the remaining 15% of these tax savings. The Tax Receivable Agreement will obligate the Company to make payments to the Tax Receivable Entity generally equal to 85% of the applicable cash savings that is actually realized as a result of utilizing NOL carryovers once the tax returns are filed for that respective tax year.

The Company estimates that the total anticipated amount of future payments under the Tax Receivable Agreement could be up to approximately $84.4 million assuming no material changes in the relevant tax law, that the Company earns sufficient taxable income to utilize the net operating loss carry forwards, and that utilization of such tax attributes is not subject to limitation under Section 382 of the Internal Revenue Code of 1986, as amended (the "Code") as the result of an “ownership change”. It is possible that future transactions or events or changes in estimates could increase or decrease the actual tax benefits realized from these tax attributes and the corresponding Tax Receivable Agreement payments and liability.

As of April 1, 2017, the Company estimates the Tax Receivable Agreement liability to be approximately $79.7 million with the remaining $4.7 million estimated for the state NOLs associated with the Tax Receivable Agreement which have a valuation allowance. Future changes in the Company's state valuation allowance position, including the reversal of all or a portion of the Company's remaining state valuation allowance, may increase the Tax Receivable Agreement liability up to the $84.4 million estimate as the Company at that point in time will project future taxable income beyond the current fiscal year for certain state income tax purposes.

As of April 1, 2017 and December 31, 2016, the Company had a long-term liability of approximately $54.3 million and $54.3 million, respectively, and a current liability of $25.4 million and $25.4 million, respectively, for the amount due pursuant to the Tax Receivable Agreement. The Company recognized a $0.0 million and $18.2 million expense for this liability during the three months ended April 1, 2017 and April 2, 2016, respectively.

Other

As of April 1, 2017, the Company has not established U.S. deferred taxes on unremitted earnings of the Company’s foreign subsidiaries. Notwithstanding the provisions within the American Jobs Creation Act of 2004, the Company continues to consider these amounts to be permanently reinvested.

STOCK-BASED COMPENSATION

A rollforward of stock options outstanding during the three months ended April 1, 2017 is presented below:



	Stock Options		Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (Years)
Balance at January 1, 2017	2,495,533		$	13.96	4.35
Granted	—		—		—
Exercised	(8,334	)	12.35		—
Forfeited or expired	—		—		—
Balance at April 1, 2017	2,487,199		$	13.96	4.10

As of April 1, 2017, 2,379,637 options were 100% vested. At April 1, 2017, the Company had approximately $0.4 million of total unrecognized compensation expense that will be recognized over a weighted average period of 0.99 years. The Company recorded compensation expense of $0.2 million and $0.3 million for the three months ended April 1, 2017 and April 2, 2016, respectively, related to stock option grants.

Restricted stock

During December 2015, the Company issued an aggregate of 25,664 restricted shares of common stock in an equal number to each of the four independent members of the Board of Directors. These shares vested over the 2016 calendar period and the Company expensed these items as compensation expense, ratably during 2016. During the three months ended April 2, 2016, the Company expensed approximately $0.1 million, related to these grants in selling, general, and administrative expenses within the condensed consolidated statement of operations and comprehensive income (loss).

During December 2016, the Company issued an aggregate of 19,420 restricted shares of common stock in an equal number to each of the four independent members of the Board of Directors. These shares will vest over the 2017 calendar year and the Company will expense these items as compensation expense ratably during 2017. During the three months ended April 1, 2017, the Company expensed approximately $0.1 million, related to these grants in selling, general, and administrative expenses within the condensed consolidated statement of operations and comprehensive income (loss).

SEGMENT INFORMATION

The Company defines operating segments as components of an enterprise about which separate financial information is available that is evaluated regularly by management in deciding how to allocate resources and in assessing performance. The Company has two reportable segments: (1) Siding, Fencing and Stone and (2) Windows and Doors.

The income before income taxes of each segment includes the revenue generated on transactions involving products within that segment less identifiable expenses. Unallocated income and expenses include items which are not directly attributed to or allocated to either of the Company’s reporting segments. Such items include interest, legal costs, corporate payroll, and unallocated finance, and accounting expenses. Unallocated corporate assets include cash and certain receivables. Interest expense is presented net of interest income.

Following is a summary of the Company’s segment information:



	For the three months ended
(Amounts in thousands)	April 1, 2017			April 2, 2016
Net sales
Siding, Fencing and Stone	$	190,837		$	176,376
Windows and Doors	239,178			232,238
	$	430,015		$	408,614
Operating earnings (loss)
Siding, Fencing and Stone	$	19,823		$	20,374
Windows and Doors	1,429			(1,250		)
Unallocated	(9,426		)	(9,548		)
	$	11,826		$	9,576

	Total assets as of
	April 1, 2017			December 31, 2016
Total assets
Siding, Fencing and Stone	$	704,664		$	691,930
Windows and Doors	511,597			509,055
Unallocated	34,735			56,756
	$	1,250,996		$	1,257,741

RELATED PARTY TRANSACTIONS

During March 2015, the Company entered into new retention agreements with the Company's Chief Executive Officer and Chief Financial Officer for $3.0 million and $1.3 million, respectively. These retention agreements incentivize these individuals for three years and will require the Company to make cumulative payments of $4.3 million on December 31, 2017, if both individuals remain employed in their current positions on that date. As of April 1, 2017 and December 31, 2016, these retention payments have been accrued at $3.2 million and $2.8 million, respectively, in accrued expenses on the Company's condensed consolidated balance sheets.

GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

GUARANTOR / NON-GUARANTOR FINANCIAL INFORMATION



PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
Three months ended April 1, 2017
	Guarantor			Issuer						Non-
	Ply Gem			Ply Gem			Guarantor			Guarantor			Consolidating
(Amounts in thousands)	Holdings, Inc.			Industries, Inc.			Subsidiaries			Subsidiaries			Adjustments			Consolidated
Net sales	$	—		$	—		$	389,583		$	40,432		$	—		$	430,015
Cost of products sold	—			—			308,116			32,374			—			340,490
Gross profit	—			—			81,467			8,058			—			89,525
Operating expenses:
Selling, general and
administrative expenses	—			9,426			50,609			12,320			—			72,355
Intercompany administrative
charges	—			—			14,968			125			(15,093		)	—
Amortization of intangible assets	—			—			4,290			1,054			—			5,344
Total operating expenses	—			9,426			69,867			13,499			(15,093		)	77,699
Operating earnings (loss)	—			(9,426		)	11,600			(5,441		)	15,093			11,826
Foreign currency gain	—			—			—			155			—			155
Intercompany interest	—			14,214			(13,408		)	(806		)	—			—
Interest expense	—			(16,886		)	—			—			—			(16,886		)
Interest income	—			2			8			4			—			14
Tax receivable agreement liability adjustment	—			—			—			—			—			—
Intercompany administrative income	—			15,093			—			—			(15,093		)	—
Income (loss) before equity in
subsidiaries' loss	—			2,997			(1,800		)	(6,088		)	—			(4,891		)
Equity in subsidiaries' loss	(3,637		)	(6,634		)	—			—			10,271			—
Income before provision (benefit)
for income taxes	(3,637		)	(3,637		)	(1,800		)	(6,088		)	10,271			(4,891		)
Provision (benefit) for income taxes	—			—			50			(1,304		)	—			(1,254		)
Net loss	$	(3,637	)	$	(3,637	)	$	(1,850	)	$	(4,784	)	$	10,271		$	(3,637	)

Other comprehensive income (loss):
Foreign currency translation adjustments	—			—			—			565			—			565
Unrealized loss on derivative instrument	—			—			—			(546		)	—			(546		)
Total comprehensive loss	$	(3,637	)	$	(3,637	)	$	(1,850	)	$	(4,765	)	$	10,271		$	(3,618	)

. GUARANTOR/NON-GUARANTOR

The 6.50% Senior Notes were issued by our direct 100% owned subsidiary, Ply Gem Industries, and are fully and unconditionally guaranteed on a joint and several basis by the Company and certain of Ply Gem Industries’ 100% owned subsidiaries. Ply Gem Industries is a 100% owned subsidiary of Ply Gem Holdings. Accordingly, the following guarantor and non-guarantor information is presented as of April 1, 2017 and December 31, 2016, and for the three months ended April 1, 2017 and April 2, 2016. The non-guarantor information presented represents our Canadian subsidiaries: Gienow and Mitten.



PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
Three months ended April 1, 2017
	Guarantor			Issuer						Non-
	Ply Gem			Ply Gem			Guarantor			Guarantor			Consolidating
(Amounts in thousands)	Holdings, Inc.			Industries, Inc.			Subsidiaries			Subsidiaries			Adjustments			Consolidated
Net sales	$	—		$	—		$	389,583		$	40,432		$	—		$	430,015
Cost of products sold	—			—			308,116			32,374			—			340,490
Gross profit	—			—			81,467			8,058			—			89,525
Operating expenses:
Selling, general and
administrative expenses	—			9,426			50,609			12,320			—			72,355
Intercompany administrative
charges	—			—			14,968			125			(15,093		)	—
Amortization of intangible assets	—			—			4,290			1,054			—			5,344
Total operating expenses	—			9,426			69,867			13,499			(15,093		)	77,699
Operating earnings (loss)	—			(9,426		)	11,600			(5,441		)	15,093			11,826
Foreign currency gain	—			—			—			155			—			155
Intercompany interest	—			14,214			(13,408		)	(806		)	—			—
Interest expense	—			(16,886		)	—			—			—			(16,886		)
Interest income	—			2			8			4			—			14
Tax receivable agreement liability adjustment	—			—			—			—			—			—
Intercompany administrative income	—			15,093			—			—			(15,093		)	—
Income (loss) before equity in
subsidiaries' loss	—			2,997			(1,800		)	(6,088		)	—			(4,891		)
Equity in subsidiaries' loss	(3,637		)	(6,634		)	—			—			10,271			—
Income before provision (benefit)
for income taxes	(3,637		)	(3,637		)	(1,800		)	(6,088		)	10,271			(4,891		)
Provision (benefit) for income taxes	—			—			50			(1,304		)	—			(1,254		)
Net loss	$	(3,637	)	$	(3,637	)	$	(1,850	)	$	(4,784	)	$	10,271		$	(3,637	)

Other comprehensive income (loss):
Foreign currency translation adjustments	—			—			—			565			—			565
Unrealized loss on derivative instrument	—			—			—			(546		)	—			(546		)
Total comprehensive loss	$	(3,637	)	$	(3,637	)	$	(1,850	)	$	(4,765	)	$	10,271		$	(3,618	)



PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEET
As of April 1, 2017
(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	$	—		$	25,656		$	(10,430	)	$	5,435		$	—		$	20,661
Accounts receivable, net	—			—			194,361			21,397			—			215,758
Inventories:
Raw materials	—			—			71,947			6,672			—			78,619
Work in process	—			—			26,517			1,856			—			28,373
Finished goods	—			—			64,295			14,079			—			78,374
Total inventory	—			—			162,759			22,607			—			185,366
Prepaid expenses and other
current assets	—			3,623			18,687			3,215			—			25,525
Total current assets	—			29,279			365,377			52,654			—			447,310
Investments in subsidiaries	4,268			(190,851		)	—			—			186,583			—
Property and Equipment, at cost:
Land	—			—			7,487			770			—			8,257
Buildings and improvements	—			518			62,378			4,497			—			67,393
Machinery and equipment	—			1,980			398,676			20,185			—			420,841
	—			2,498			468,541			25,452			—			496,491
Less accumulated depreciation	—			(712		)	(318,515		)	(11,323		)	—			(330,550		)
Total property and equipment, net	—			1,786			150,026			14,129			—			165,941
Other Assets:
Intangible assets, net	—			—			87,485			11,457			—			98,942
Goodwill	—			—			449,366			29,429			—			478,795
Deferred income taxes	—			—			51,599			—			—			51,599
Intercompany note receivable	—			1,137,073			—			—			(1,137,073		)	—
Other	—			3,670			4,739			—			—			8,409
Total other assets	—			1,140,743			593,189			40,886			(1,137,073		)	637,745
	$	4,268		$	980,957		$	1,108,592		$	107,669		$	(950,490	)	$	1,250,996

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities:
Accounts payable	$	—		$	412		$	74,480		$	9,915		$	—		$	84,807
Accrued expenses	—			17,215			92,638			14,918			—			124,771
Current portion of payable to related
parties pursuant to tax receivable agreement	—			25,383			—			—			—			25,383
Current portion of long-term debt	—			4,300			—			—			—			4,300
Total current liabilities	—			47,310			167,118			24,833			—			239,261
Deferred income taxes	—			—			—			693			—			693
Intercompany note payable	—			—			1,024,779			112,294			(1,137,073		)	—
Long-term portion of payable to related
parties pursuant to tax receivable agreement	—			54,336			—			—			—			54,336
Other long-term liabilities	—			6,705			71,771			5,624			—			84,100
Long-term debt	—			868,338			—			—			—			868,338
Commitments and contingencies
Stockholders' Equity (Deficit):
Preferred stock	—			—			—			—			—			—
Common stock	684			684			—			—			(684		)	684
Additional paid-in-capital	753,911			753,911			285,075			24,158			(1,063,144		)	753,911
(Accumulated deficit) retained earnings	(717,054		)	(717,054		)	(424,472		)	(41,096		)	1,182,622			(717,054		)
Accumulated other
comprehensive loss	(33,273		)	(33,273		)	(15,679		)	(18,837		)	67,789			(33,273		)
Total stockholders' (deficit) equity	4,268			4,268			(155,076		)	(35,775		)	186,583			4,268
	$	4,268		$	980,957		$	1,108,592		$	107,669		$	(950,490	)	$	1,250,996



PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEET
As of December 31, 2016
	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	$	—		$	50,035		$	(10,918	)	$	12,480		$	—		$	51,597
Accounts receivable, net	—			—			189,983			19,936			—			209,919
Inventories:
Raw materials	—			—			63,829			5,810			—			69,639
Work in process	—			—			23,007			1,614			—			24,621
Finished goods	—			—			54,346			13,350			—			67,696
Total inventory	—			—			141,182			20,774			—			161,956
Prepaid expenses and other
current assets	—			1,276			21,940			3,634			—			26,850
Total current assets	—			51,311			342,187			56,824			—			450,322
Investments in subsidiaries	4,106			(231,236		)	—			—			227,130			—
Property and Equipment, at cost:
Land	—			—			7,487			762			—			8,249
Buildings and improvements	—			510			63,000			4,441			—			67,951
Machinery and equipment	—			1,675			392,068			19,822			—			413,565
	—			2,185			462,555			25,025			—			489,765
Less accumulated depreciation	—			(665		)	(312,759		)	(10,785		)	—			(324,209		)
Total property and equipment, net	—			1,520			149,796			14,240			—			165,556
Other Assets:
Intangible assets, net	—			—			91,748			12,411			—			104,159
Goodwill	—			—			449,366			29,148			—			478,514
Deferred income taxes	—			—			50,347						—			50,347
Intercompany note receivable	—			1,135,073			—			—			(1,135,073		)	—
Other	—			3,925			4,918			—			—			8,843
Total other assets	—			1,138,998			596,379			41,559			(1,135,073		)	641,863
	$	4,106		$	960,593		$	1,088,362		$	112,623		$	(907,943	)	$	1,257,741

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities:
Accounts payable	$	—		$	377		$	64,206		$	10,815		$	—		$	75,398
Accrued expenses	—			29,812			124,723			14,480			—			169,015
Current portion of payable to related
parties pursuant to tax receivable agreement	—			25,383			—			—			—			25,383
Current portion of long-term debt	—			4,300			—			—			—			4,300
Total current liabilities	—			59,872			188,929			25,295			—			274,096
Deferred income taxes	—			—			—			2,722			—			2,722
Intercompany note payable	—			—			1,026,657			108,416			(1,135,073		)	—
Long-term portion of payable to related
parties pursuant to tax receivable agreement	—			54,336			—			—			—			54,336
Other long-term liabilities	—			6,193			74,835			5,367			—			86,395
Long-term debt	—			836,086			—			—			—			836,086
Commitments and contingencies
Stockholders' Equity (Deficit):
Preferred stock	—			—			—			—			—			—
Common stock	683			683			—			—			(683		)	683
Additional paid-in-capital	751,452			751,452			236,242			26,464			(1,014,158		)	751,452
(Accumulated deficit) retained earnings	(714,737		)	(714,737		)	(422,622		)	(36,312		)	1,173,671			(714,737		)
Accumulated other
comprehensive loss	(33,292		)	(33,292		)	(15,679		)	(19,329		)	68,300			(33,292		)
Total stockholders' (deficit) equity	4,106			4,106			(202,059		)	(29,177		)	227,130			4,106
	$	4,106		$	960,593		$	1,088,362		$	112,623		$	(907,943	)	$	1,257,741



PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
For the three months ended April 1, 2017
(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 loss	$	(3,637	)	$	(3,637	)	$	(1,850	)	$	(4,784	)	$	10,271		$	(3,637	)
Adjustments to reconcile net loss
to cash used in operating activities:
Depreciation and amortization expense	—			46			11,702			1,705			—			13,453
Non-cash restructuring costs	—			—			904			—			—			904
Non-cash interest expense, net	—			3,477			—			—			—			3,477
Gain on foreign currency transactions	—			—			—			(155		)	—			(155		)
Stock based compensation	—			259			—			—			—			259
Deferred income taxes	—			—			59			(2,226		)	—			(2,167		)
Increase in tax uncertainty	—			—			(144		)	—			—			(144		)
Equity in subsidiaries' net income (loss)	3,637			6,634			—			—			(10,271		)	—
Other	—			—			32			—			—			32
Changes in operating assets and liabilities:
Accounts receivable, net	—			—			(4,718		)	(1,126		)	—			(5,844		)
Inventories	—			—			(21,775		)	(1,643		)	—			(23,418		)
Prepaid expenses and other assets	—			(2,243		)	3,269			92			—			1,118
Accounts payable	—			35			8,368			1,011			—			9,414
Accrued expenses	—			(8,854		)	(35,943		)	809			—			(43,988		)
Cash payments on restructuring liabilities	—			—			(23		)	—			—			(23		)
Other	—			—			—			82			—			82
Net cash used in
operating activities	—			(4,283		)	(40,119		)	(6,235		)	—			(50,637		)
Cash flows from investing activities:
Capital expenditures	—			(313		)	(7,580		)	(525		)	—			(8,418		)
Proceeds from sale of assets	—			—			29			43			—			72
Net cash used in
investing activities	—			(313		)	(7,551		)	(482		)	—			(8,346		)
Cash flows from financing activities:
Net revolver borrowings	—			30,000			—			—			—			30,000
Payments on long-term debt	—			(1,075		)	—			—			—			(1,075		)
Payments to tax authority for employee share-based compensation	—			(1,186		)	—			—			—			(1,186		)
Proceeds from exercises of employee stock options	—			103			—			—			—			103
Proceeds from intercompany
investment	—			(47,625		)	48,158			(533		)	—			—
Net cash provided by (used in)
financing activities	—			(19,783		)	48,158			(533		)	—			27,842
Impact of exchange rate movements on cash	—			—			—			205			—			205
Net increase (decrease) in cash
and cash equivalents	—			(24,379		)	488			(7,045		)	—			(30,936		)
Cash and cash equivalents at the
beginning of the period	—			50,035			(10,918		)	12,480			—			51,597
Cash and cash equivalents at the end
of the period	$	—		$	25,656		$	(10,430	)	$	5,435		$	—		$	20,661

GUARANTOR / NON-GUARANTOR FINANCIAL INFORMATION



PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
Three months ended April 2, 2016
	Guarantor			Issuer						Non-
	Ply Gem			Ply Gem			Guarantor			Guarantor			Consolidating
(Amounts in thousands)	Holdings, Inc.			Industries, Inc.			Subsidiaries			Subsidiary			Adjustments			Consolidated
Net sales	$	—		$	—		$	369,514		$	39,100		$	—		$	408,614
Cost of products sold	—			—			289,872			32,041			—			321,913
Gross profit	—			—			79,642			7,059			—			86,701
Operating expenses:
Selling, general and
administrative expenses	—			9,548			49,022			12,165			—			70,735
Intercompany administrative
charges	—			—			7,772			1,673			(9,445		)	—
Amortization of intangible assets	—			—			5,360			1,030			—			6,390
Total operating expenses	—			9,548			62,154			14,868			(9,445		)	77,125
Operating earnings (loss)	—			(9,548		)	17,488			(7,809		)	9,445			9,576
Foreign currency gain	—			—			—			584			—			584
Intercompany interest	—			15,933			(15,550		)	(383		)	—			—
Interest expense	—			(18,691		)	—			(1		)	—			(18,692		)
Interest income	—			2			2			6			—			10
Loss on modification or
extinguishment of debt	—			(2,399		)	—			—			—			(2,399		)
Tax receivable agreement liability adjustment	—			(18,150		)	—			—			—			(18,150		)
Intercompany administrative income	—			9,445			—			—			(9,445		)	—
Income (loss) before equity in
subsidiaries' income (loss)	—			(23,408		)	1,940			(7,603		)	—			(29,071		)
Equity in subsidiaries' income (loss)	(27,577		)	(4,169		)	—			—			31,746			—
Income (loss) before benefit
for income taxes	(27,577		)	(27,577		)	1,940			(7,603		)	31,746			(29,071		)
Benefit for income taxes	—			—			(527		)	(967		)	—			(1,494		)
Net income (loss)	$	(27,577	)	$	(27,577	)	$	2,467		$	(6,636	)	$	31,746		$	(27,577	)

Other comprehensive income (loss):
Foreign currency translation adjustments	—			—			—			4,773			—			4,773
Unrealized loss on derivative instrument	—			—			—			(1,720		)	—			(1,720		)
Total comprehensive income (loss)	$	(27,577	)	$	(27,577	)	$	2,467		$	(3,583	)	$	31,746		$	(24,524	)



PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
For the three months ended April 2, 2016
(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)	$	(27,577	)	$	(27,577	)	$	2,467		$	(6,636	)	$	31,746		$	(27,577	)
Adjustments to reconcile net income (loss)
to cash provided by (used in) operating activities:
Depreciation and amortization expense	—			61			12,379			1,590			—			14,030
Non-cash restructuring expense	—			—			—			566			—			566
Non-cash interest expense, net	—			3,416			—			—			—			3,416
Gain on foreign currency transactions	—			—			—			(584		)	—			(584		)
Loss on modification or extinguishment of debt	—			2,399			—			—			—			2,399
Stock based compensation	—			337			—			—			—			337
Deferred income taxes	—			—			65			—			—			65
Tax receivable agreement liability adjustment	—			18,150			—			—			—			18,150
Increase in tax uncertainty,
net of valuation allowance	—			—			62			—			—			62
Equity in subsidiaries' net income (loss)	27,577			4,169			—			—			(31,746		)	—
Other	—			—			138			—			—			138
Changes in operating assets and liabilities:
Accounts receivable, net	—			—			(11,718		)	2,584			—			(9,134		)
Inventories	—			—			(10,511		)	(467		)	—			(10,978		)
Prepaid expenses and other assets	—			(285		)	(68		)	98			—			(255		)
Accounts payable	—			(54		)	(3,995		)	3,174			—			(875		)
Accrued expenses	—			(13,833		)	(25,802		)	1,860			—			(37,775		)
Cash payments on restructuring liabilities	—			—			(112		)	(556		)	—			(668		)
Other	—			—			139			(2		)	—			137
Net cash provided by (used in)
operating activities	—			(13,217		)	(36,956		)	1,627			—			(48,546		)
Cash flows from investing activities:
Capital expenditures	—			(362		)	(6,946		)	(424		)	—			(7,732		)
Proceeds from sale of assets	—			—			76			—			—			76
Net cash used in
investing activities	—			(362		)	(6,870		)	(424		)	—			(7,656		)
Cash flows from financing activities:
Net revolver borrowings	—			10,000			—			—			—			10,000
Payments on long-term debt	—			(31,075		)	—			—			—			(31,075		)
Proceeds from intercompany
investment	—			(28,351		)	41,818			(13,467		)	—			—
Net cash provided by (used in)
financing activities	—			(49,426		)	41,818			(13,467		)	—			(21,075		)
Impact of exchange rate movement
on cash	—			—			—			2,193			—			2,193
Net decrease in cash
and cash equivalents	—			(63,005		)	(2,008		)	(10,071		)	—			(75,084		)
Cash and cash equivalents at the
beginning of the period	—			94,692			(4,944		)	19,677			—			109,425
Cash and cash equivalents at the end
of the period	$	—		$	31,687		$	(6,952	)	$	9,606		$	—		$	34,341

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of Ply Gem Holdings, Inc. and its subsidiaries (referred to herein as “Ply Gem Holdings”, “Ply Gem”, the “Company”, “we”, “us”, or “our”) have been prepared in accordance with U.S. generally accepted accounting principles as described in the consolidated financial statements and related notes included in our 2016 Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 10, 2017. These statements do not include all of the information and footnotes required by U.S. generally accepted accounting principles and should be read in conjunction with our 2016 Annual Report on Form 10-K. In management’s opinion, all normal and recurring adjustments considered necessary for a fair presentation have been included. Operating results for the period from January 1, 2017 through April 1, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017.

The condensed consolidated balance sheet at December 31, 2016 has been derived from the audited consolidated financial statements of Ply Gem Holdings at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements.

The Company’s fiscal quarters are based on periods ending on the Saturday of the last week in the quarter. Therefore, the financial results of certain fiscal quarters will not be comparable to the prior and subsequent fiscal quarters. The accompanying financial statements include the Company’s condensed consolidated statements of operations and comprehensive income (loss) for the three months ended April 1, 2017 and April 2, 2016, the condensed consolidated statements of cash flows for the three months ended April 1, 2017 and April 2, 2016, and the condensed consolidated balance sheets as of April 1, 2017 and December 31, 2016.

Ply Gem is a diversified manufacturer of residential and commercial building products, which are sold primarily in the United States and Canada, and include a wide variety of products for the residential and commercial construction, the do-it-yourself and the professional remodeling and renovation markets. The demand for the Company’s products is seasonal, particularly in the Northeast and Midwest regions of the United States and Canada where inclement weather during the winter months usually reduces the level of building and remodeling activity in both the home repair and remodeling and new home construction sectors. The Company’s sales are usually lower during the first and fourth quarters.

To a significant extent our performance is dependent upon the levels of home repair and remodeling and new home construction spending, all of which are affected by such factors as interest rates, inflation, consumer confidence, unemployment, and availability of consumer credit.

Principles of Consolidation

The condensed consolidated financial statements include the accounts of Ply Gem Holdings and its subsidiaries, all of which are wholly owned. All intercompany accounts and transactions have been eliminated.

Accounting Policies and Use of Estimates

The preparation of these condensed consolidated financial statements in conformity with U.S. generally accepted accounting principles involves estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of income and expense during the reporting periods. Certain of the Company’s accounting policies require the application of judgment in selecting the appropriate assumptions for calculating financial estimates. By their nature, these judgments are subject to an inherent degree of uncertainty. The Company periodically evaluates the judgments and estimates used in their critical accounting policies to ensure that such judgments and estimates are reasonable. Such estimates include the allowance for doubtful accounts receivable, rebates, pensions, valuation of inventories, warranty reserves, insurance reserves, legal contingencies, assumptions used in the calculation of income taxes and the tax receivable agreement liability, projected cash flows used in the goodwill and intangible asset impairment tests, and environmental accruals and other contingencies. These judgments are based on the Company’s historical experience, current trends and information available from other sources, and are based on management’s best estimates and judgments. The Company adjusts such estimates and assumptions when facts and circumstances dictate. Volatile equity markets, foreign currency, and litigation risk have combined to increase the uncertainty inherent in such estimates and assumptions. If different conditions result from those assumptions used in the Company’s judgments, actual results could be materially different from the Company’s estimates.

Cash and Cash Equivalents

Cash equivalents consist of short-term highly liquid investments with original maturities of three months or less and which are readily convertible into cash.

Accounts Receivable

Accounts receivable-trade are recorded at their net realizable value. The allowance for doubtful accounts was $2.8 million at April 1, 2017 and $2.7 million at December 31, 2016. The Company maintains an allowance for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments. The Company estimates the allowance for doubtful accounts based on a variety of factors including the length of time receivables are past due, the financial health of its customers, unusual macroeconomic conditions and historical experience. If the financial condition of its customers deteriorates or other circumstances occur that result in an impairment of customers’ ability to make payments, the Company records additional allowances as needed. The Company writes off uncollectible trade accounts receivable against the allowance for doubtful accounts when collection efforts have been exhausted and/or any legal action taken by the Company has concluded.

Inventories

Inventories in the accompanying condensed consolidated balance sheets are valued at the lower of cost or net realizable value and are determined primarily by the first-in, first-out (FIFO) method. The Company records provisions, as appropriate, to write-down obsolete and excess inventory to estimated net realizable value. The process for evaluating obsolete and excess inventory often requires the Company to make subjective judgments and estimates concerning future sales levels, quantities and prices at which such inventory will be able to be sold in the normal course of business. Accelerating the disposal process or incorrect estimates of future sales potential may cause actual results to differ from the estimates at the time such inventory is disposed or sold. As of April 1, 2017, the Company had inventory purchase commitments of approximately $95.5 million.

Inventory provisions were approximately $8.5 million at April 1, 2017, increasing during the three months ended April 1, 2017 by $0.1 million compared to the December 31, 2016 provision balance of approximately $8.4 million.

Property and Equipment

Property and equipment are presented at cost. Depreciation of property and equipment are provided on a straight-line basis over estimated useful lives, which are generally as follows:



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

Expenditures for maintenance and repairs are expensed when incurred. Expenditures for renewals and betterments are capitalized. When assets are sold, or otherwise disposed, the cost and related accumulated depreciation are eliminated and the resulting gain or loss is recognized in operations.

Long-lived assets

The Company reviews long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. The Company performs an undiscounted operating cash flow analysis to determine if impairment exists. If an impairment is determined to exist, any related impairment loss is calculated based on the asset’s fair value and the discounted cash flows.

The Company tests for long-lived asset impairment at the following asset group levels: (i) the combined U.S. Siding, Fencing and Stone companies in the Siding, Fencing and Stone segment (“Siding”), (ii) the combined U.S. Windows companies in the Windows and Doors segment (“U.S. Windows”), (iii) the combined Simonton windows companies in the Windows and Doors segment, (iv) Gienow Canada Inc. ("Gienow Canada") (a combined Western Canadian company created by the January 2014 amalgamation of the Company's legacy Western Canadian business and the Gienow entity acquired in April 2013) in the Windows and Doors segment, and (v) Mitten in the Siding, Fencing and Stone segment. For purposes of recognition and measurement of an impairment loss, a long-lived asset or asset group should represent the lowest level for which an entity can separately identify cash flows that are largely independent of the cash flows of other assets and liabilities. There were no indicators of impairment during the three months ended April 1, 2017.

Goodwill and other intangible assets

The Company evaluates goodwill for impairment on an annual basis and whenever events or business conditions warrant. All other intangible assets are amortized over their estimated useful lives and are assessed for impairment as necessary. The Company assesses goodwill for impairment at the November month end each year and also at any other date when events or changes in circumstances indicate that the carrying value of these assets may exceed their fair value. To evaluate goodwill for impairment, the Company estimates the fair value of reporting units considering such factors as discounted cash flows and valuation multiples for comparable publicly traded companies. A significant reduction in projected sales and earnings, which would lead to a reduction in future cash flows, could indicate potential impairment. There were no indicators of impairment during the three months ended April 1, 2017 that would trigger an interim impairment test. The Company will continue to evaluate goodwill during future periods and future declines in the residential housing and repair and remodeling markets could result in goodwill impairments.

Debt Issuance Costs

Debt issuance costs, composed of facility, agency, and certain legal fees associated with issuing new debt financing, are amortized over the contractual term of the related agreement using the effective interest method. Net debt issuance costs totaled approximately $15.7 million and $16.5 million as of April 1, 2017 and December 31, 2016, respectively, and have been recorded within long-term debt ($13.5 million at April 1, 2017 and $14.2 million at December 31, 2016) and other non-current assets ($2.2 million at April 1, 2017 and $2.3 million at December 31, 2016) in the accompanying condensed consolidated balance sheets. The debt issuance costs included in other long term assets relate to the Senior Secured Asset Based Revolving Credit Facility due 2020 ("ABL Facility"). Amortization of debt issuance costs for the three months ended April 1, 2017 and April 2, 2016 was approximately $0.8 million and $0.8 million, respectively. Amortization of debt issuance costs is recorded in interest expense in the accompanying condensed consolidated statements of operations and comprehensive income (loss).

Income Taxes

The Company utilizes the asset and liability method of accounting for income taxes which requires that deferred tax assets and liabilities be recorded to reflect the future tax consequences of temporary differences between the book and tax basis of various assets and liabilities. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of changes in tax rates on deferred tax assets and liabilities is recognized as income or expense in the period in which the rate change occurs. A valuation allowance is established to offset any deferred tax assets if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

Estimates are required with respect to, among other things, the appropriate state income tax rates used in the various states that the Company and its subsidiaries are required to file, the potential utilization of operating and capital loss carry-forwards for both federal and state income tax purposes and valuation allowances required, if any, for deferred tax assets that may not be realized in the future. The Company establishes reserves when, despite our belief that our tax return positions are fully supportable, certain positions could be challenged, and the positions may not be fully sustained. The Company, along with its U.S. subsidiaries, file a consolidated federal income tax return, separate state income tax returns, combined state returns, and unitary state returns. Gienow Canada and Mitten both file separate Canadian federal income tax returns and separate provincial returns.

Tax receivable agreement ("TRA") liability

The TRA liability generally provides for the payment by the Company to the Tax Receivable Entity of 85% of the amount of cash savings, if any, in the U.S. federal, state and local income tax that the Company actually realizes in periods ending after the Company's initial public offering as a result of (i) net operating loss carryovers ("NOLs") from periods ending before January 1, 2013, (ii) deductible expenses attributable to the initial public offering and (iii) deductions related to imputed interest. Since the inception of the TRA liability with the Company’s 2013 initial public offering through 2015, the Company had been in a full valuation allowance for federal purposes and had partial valuation allowances on certain state and Canadian jurisdictions. As a result of the Company’s tax valuation allowance position for federal and state purposes, the Company historically calculated the TRA liability considering (i) current year taxable income only (due to the uncertainty of future taxable income associated with the Company’s cumulative loss position) and (ii) future income due to the expected reversals of deferred tax liabilities. During the year ended December 31, 2016, the Company released its valuation allowance on its federal deferred tax assets and certain state deferred tax assets for approximately $55.2 million due to positive factors outweighing negative evidence thereby allowing the Company to achieve the “more likely than not” realization threshold. The factors surrounding the release of this valuation allowance thereby eliminated any uncertainty as to future taxable income. Consequently, for purposes of calculating the TRA liability, the Company during the year ended December 31, 2016 utilized future forecasts of taxable income beyond the 2016 tax year to determine the TRA liability. The Company’s future taxable income estimate was used to determine the cumulative NOLs that are expected to be utilized and the TRA liability was accordingly adjusted using the 85% TRA rate as the Company retains the benefit of 15% of the tax savings.

Environmental

The Company accrues for losses associated with environmental remediation obligations when such losses are probable and reasonably estimable. Environmental remediation obligation accruals are adjusted as further information develops or circumstances change. Costs of future expenditures for environmental remediation obligations are not discounted to their present value. Recoveries of environmental remediation costs from other parties are recorded as assets when their receipt is deemed probable.

Commitments and Contingencies, Policy

Commitments and Contingencies

The Company accrues for all direct costs associated with the estimated resolution of contingencies at the earliest date at which it is deemed probable that a liability has been incurred and the amount of such liability can be reasonably estimated. Costs accrued have been estimated based upon an analysis of potential results, assuming a combination of litigation and settlement strategies and outcomes. Insurance recoveries are recorded as assets when their receipt is deemed probable.

Foreign Currency

Gienow Canada and Mitten, the Company’s Canadian subsidiaries, utilize the Canadian dollar as their functional currency. For reporting purposes, the Company translates the assets and liabilities of its foreign entities at the exchange rates in effect at period-end. Net sales and expenses are translated using average exchange rates in effect during the period. Gains and losses from foreign currency translation are credited or charged to accumulated other comprehensive income or loss in the accompanying condensed consolidated balance sheets.

The Company recorded a gain from foreign currency transactions of approximately $0.2 million and $0.6 million for the three months ended April 1, 2017 and April 2, 2016, respectively. During the three months ended April 1, 2017, accumulated other comprehensive income (loss) included a currency translation gain of approximately $0.6 million and a gain of approximately $4.8 million for the three months ended April 2, 2016

Derivatives, Policy [Policy Text Block]

Derivative Financial Instruments

As of April 1, 2017, the Company had entered into foreign currency forward contract agreements to hedge approximately $31.7 million of its 2017 non-functional currency inventory purchases to protect the Company from variability in cash flows attributable to changes in the U.S. dollar relative to the Canadian dollar.

The Company has designated these forward contracts as cash flow hedges. As a cash flow hedge, unrealized gains are recognized as assets while unrealized losses are recognized as liabilities. These forward contract agreements are highly correlated to the changes in foreign currency rates to which the Company is exposed. Unrealized gains and losses on these agreements are designated as effective or ineffective. The effective portion of such gains or losses is recorded as a component of accumulated other comprehensive income or loss, while the ineffective portion of such gains or losses is recorded as a component of cost of goods sold. Future realized gains and losses in connection with each inventory purchase will be reclassified from accumulated other comprehensive income or loss to cost of goods sold.

The changes in fair values of derivatives that have been designated and qualify as cash flow hedges are recorded in accumulated other comprehensive income or loss and are reclassified into cost of goods sold in the same period the hedged item affects earnings. Due to the high degree of effectiveness between the hedging instruments and the underlying exposures being hedged, fluctuations in the value of the derivative instrument are generally offset by changes in the fair value or cash flows of the underlying exposures being hedged. The changes in the fair value of derivatives that do not qualify as effective are immediately recognized in earnings.

The gains and losses on derivative contracts that are reclassified from accumulated other comprehensive income or loss to current period earnings are included in the line item in which the hedged item is recorded in the same period the forecasted transaction affects earnings. As of April 1, 2017, approximately $0.5 million of the deferred net asset on derivative instruments included in accumulated other comprehensive loss is expected to be reclassified to cost of goods sold during the next twelve months. This expectation is based on the expected timing of the occurrence of the hedged forecasted transactions. During the three months ended April 1, 2017, the Company recognized $0.1 million, within earnings as a reduction to cost of goods sold in the condensed consolidated statement of operations and comprehensive income (loss). During three months ended April 2, 2016, the Company recognized $0.4 million, within earnings as a reduction of cost of goods sold in the condensed consolidated statement of operations and comprehensive income (loss).

The fair value of the foreign currency forward contract agreements are estimated using industry standard valuation models using market-based observable inputs, including spot rates, forward points, interest rates and volatility inputs (Level 2).

Fair Value Measurement

The accounting standard for fair value discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flows), and the cost approach (cost to replace the service capacity of an asset or replacement cost). The standard utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:


•	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.

The hierarchy requires the use of observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. The fair value of the long-term debt instruments was determined by utilizing available market information. The carrying value of the Company’s other assets and liabilities approximates their fair value.

Earnings (loss) per common share

Earnings (Loss) Per Common Share

Basic earnings (loss) per share ("EPS") is computed based upon weighted-average shares outstanding during the period. Dilutive earnings per share is computed consistently with the basic computation while giving effect to all dilutive potential common shares and common share equivalents that were outstanding during the period. Ply Gem Holdings uses the treasury stock method to reflect the potential dilutive effect of unvested stock awards and unexercised options.

The computation of the dilutive effect of other potential common shares excluded options and unvested restricted stock representing approximately 0.6 million shares of common stock for the three months ended April 1, 2017. The computation of the dilutive effect of other potential common shares excluded options and unvested restricted stock representing approximately 0.1 million shares of common stock for the three months ended April 2, 2016.

New accounting pronouncements

New Accounting Pronouncements

In March 2017, the Financial Accounting Standards Board (“FASB”) issued ASU 2017-07, Compensation-Retirement Benefits (Topic 715) Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. ASU 2017-07 changes the statement of operations presentation of defined benefit plan expense by requiring separation between operating expense (service cost component) and non-operating expense (all other components, including interest cost, amortization of prior service cost, curtailments and settlements, etc.). The operating expense component is reported with similar compensation costs while the non-operating components are reported in other income and expense. In addition, only the service cost component is eligible for capitalization as part of an asset such as inventory or property, plant and equipment. ASU 2017-07 is effective for annual reporting periods, and interim periods therein, beginning after December 15, 2017 or fiscal 2018 for the Company. The Company is currently assessing the impact that adopting this new accounting standard will have on its consolidated financial statements.

Effective January 1, 2017, the Company adopted ASU 2016-09, Improvements to Employee Share-Based Payment Accounting. The standard update simplifies several aspects of the accounting for employee share-based payment transactions, including accounting for income taxes, forfeitures, and statutory withholding requirements, as well as classification in the condensed consolidated statements of cash flows. As a result of the adoption, on a modified retrospective basis, we recognized $1.3 million of excess tax benefits from stock-based compensation through a cumulative-effect adjustment decreasing accumulated deficit. We elected not to change our policy on accounting for forfeitures and will continue to estimate a requisite forfeiture rate. Additional amendments to the accounting for income taxes and minimum statutory withholding requirements had no impact on the Company's results of operations.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

Schedule of property and equpiment

Depreciation of property and equipment are provided on a straight-line basis over estimated useful lives, which are generally as follows:



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

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block]

A summary of the recorded asset and liability included in the accompanying condensed consolidated balance sheets is as follows:



(Amounts in thousands)	April 1, 2017		December 31, 2016
Foreign currency hedge included in other current assets	$	471	$	962

Summary of fair value liabilities

The Company’s population of recurring financial assets and liabilities subject to fair value measurements and the necessary disclosures are as follows:



					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	$	676,000	$	676,000	$	—	$	—
Term Loan Facility	257,100		257,743		—		257,743		—
As of April 1, 2017	$	907,100	$	933,743	$	676,000	$	257,743	$	—
Liabilities:
Senior Notes-6.50%	$	650,000	$	676,000	$	676,000	$	—	$	—
Term Loan Facility	258,175		260,757		—		260,757		—
As of December 31, 2016	$	908,175	$	936,757	$	676,000	$	260,757	$	—

GOODWILL (Tables)

Schedule of Goodwill [Table Text Block]

A goodwill rollforward for 2017 is included in the table below:



	Windows and			Siding, Fencing
(Amounts in thousands)	Doors			and Stone
Balance as of December 31, 2016
Goodwill	$	457,734		$	470,780
Accumulated impairment losses	(327,773		)	(122,227		)
	$	129,961		$	348,553
Currency translation adjustments	89			192
Balance as of April 1, 2017
Goodwill	457,823			470,972
Accumulated impairment losses	(327,773		)	(122,227		)
	$	130,050		$	348,745

Schedule of reporting unit goodwill balances

The reporting unit goodwill balances were as follows as of April 1, 2017 and December 31, 2016:



(Amounts in thousands)
	April 1, 2017		December 31, 2016
Siding, Fencing and Stone	$	348,745	$	348,553
Windows and Doors	130,050		129,961
	$	478,795	$	478,514

INTANGIBLE ASSETS (Tables)

Components of intangible assets

The table that follows presents the major components of intangible assets as of April 1, 2017 and December 31, 2016:



(Amounts in thousands)	Average Amortization Period			Accumulated			Net Carrying
	(in Years)	Cost		Amortization			Value
As of April 1, 2017:
Patents	14	$	12,770	$	(12,199	)	$	571
Trademarks/Tradenames	12	117,142		(84,227		)	32,915
Customer relationships	13	218,108		(153,270		)	64,838
Other	4	5,665		(5,047		)	618
Total intangible assets	12	$	353,685	$	(254,743	)	$	98,942

As of December 31, 2016:
Patents	14	$	12,770	$	(12,078	)	$	692
Trademarks/Tradenames	12	117,124		(82,723		)	34,401
Customer relationships	13	217,861		(150,310		)	67,551
Other	4	5,661		(4,146		)	1,515
Total intangible assets	12	$	353,416	$	(249,257	)	$	104,159

Schedule of expected amortization expense

Estimated amortization expense for the fiscal years 2017 through 2021 is shown in the following table:



	Amortization
(Amounts in thousands)	expense

2017 (remainder of year)	$	15,414
2018	19,935
2019	15,829
2020	11,150
2021	6,709

COMPREHENSIVE INCOME (LOSS) (Tables)

Schedule of comprehensive income (loss)

Comprehensive income (loss), net of tax is comprised of the following:



(Amounts in thousands)	For the three months ended
	April 1, 2017			April 2, 2016
Net loss	$	(3,637	)	$	(27,577	)
Foreign currency translation adjustment	565			4,773
Unrealized loss on derivative instruments	(546		)	(1,720		)
Comprehensive loss	$	(3,618	)	$	(24,524	)

LONG-TERM DEBT (Tables)

Schedule of Extinguishment of Debt [Table Text Block]



(Amounts in thousands)	For the three months ended
	April 1, 2017		April 2, 2016
Loss on modification of debt:
Term Loan Facility unamortized discount	$	—	$	1,915
Term Loan Facility unamortized debt issuance costs	—		484
Total loss on modification or extinguishment of debt	$	—	$	2,399

Schedule of Long-term Debt Instruments

Long-term debt in the accompanying condensed consolidated balance sheets at April 1, 2017 and December 31, 2016 consists of the following:



(Amounts in thousands)
	April 1, 2017			December 31, 2016
Senior secured asset based revolving credit facility	$	30,000		$	—
Term Loan due 2021, net of unamortized early tender premium,
discount, and debt issuance costs of $16,536 and $17,854, respectively	240,564			240,321
6.50% Senior notes due 2022, net of unamortized early tender premium,
discount, and debt issuance costs of $47,926 and $49,935, respectively	602,074			600,065
	$	872,638		$	840,386
Less current portion of long-term debt	(4,300		)	(4,300		)
	$	868,338		$	836,086

PENSION PLANS (Tables)

Net periodic benefit expense

The Company’s net periodic benefit expense for the combined plans for the periods indicated consists of the following components:



(Amounts in thousands)	For the three months ended
	April 1, 2017			April 2, 2016
Service cost	$	—		$	—
Interest cost	459			486
Expected return on plan assets	(546		)	(545		)
Amortization of loss	351			354
Net periodic benefit expense	$	264		$	295

COMMITMENTS AND CONTINGENCIES (Tables)

Components of the indemnification

the Company has recorded liabilities related to these indemnifications of approximately $0.5 million and $0.5 million, respectively, in current liabilities and $0.9 million and $0.9 million, respectively, in long-term liabilities, consisting of the following:



(Amounts in thousands)	April 1, 2017		December 31, 2016
Product claim liabilities	$	138	$	138
Multi-employer pension plan withdrawal liability	718		808
Other	497		500
	$	1,353	$	1,446

Changes in the Company's warranty liabilities

Changes in the Company’s short-term and long-term warranty liabilities are as follows:



	For the three months ended
(Amounts in thousands)	April 1, 2017			April 2, 2016
Balance, beginning of period	$	77,293		$	76,562
Warranty expense during period	6,166			5,512
Settlements made during period	(5,008		)	(4,613		)
Balance, end of period	$	78,451		$	77,461

ACCRUED EXPENSES AND OTHER LONG-TERM LIABILITIES (Tables)

Accrued expenses and other long term liabilities

Accrued expenses consist of the following at April 1, 2017 and December 31, 2016:



(Amounts in thousands)	April 1, 2017		December 31, 2016
Insurance	$	8,493	$	8,297
Employee compensation and benefits	17,384		27,749
Sales and marketing	29,140		59,655
Product warranty	20,189		19,718
Accrued freight	2,664		2,146
Accrued interest	7,286		17,977
Accrued environmental liability	435		434
Accrued pension	1,753		1,753
Accrued sales returns and discounts	1,418		1,199
Accrued taxes	5,605		4,966
Litigation accrual	2,575		2,575
Other	27,829		22,546
	$	124,771	$	169,015

Other long-term liabilities consist of the following at April 1, 2017 and December 31, 2016:



(Amounts in thousands)	April 1, 2017		December 31, 2016
Insurance	$	597	$	605
Pension liabilities	13,958		13,907
Multi-employer pension withdrawal liability	718		808
Product warranty	58,262		57,575
Long-term product claim liability	138		138
Long-term environmental liability	1,158		1,158
Liabilities for tax uncertainties	3,781		3,925
Litigation accrual	731		731
Other	4,757		7,548
	$	84,100	$	86,395

STOCK-BASED COMPENSATION (Tables)

Rollforward of stock options outstanding

A rollforward of stock options outstanding during the three months ended April 1, 2017 is presented below:



	Stock Options		Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (Years)
Balance at January 1, 2017	2,495,533		$	13.96	4.35
Granted	—		—		—
Exercised	(8,334	)	12.35		—
Forfeited or expired	—		—		—
Balance at April 1, 2017	2,487,199		$	13.96	4.10

SEGMENT INFORMATION (Tables)

Summary of the Company's segment information

Following is a summary of the Company’s segment information:



	For the three months ended
(Amounts in thousands)	April 1, 2017			April 2, 2016
Net sales
Siding, Fencing and Stone	$	190,837		$	176,376
Windows and Doors	239,178			232,238
	$	430,015		$	408,614
Operating earnings (loss)
Siding, Fencing and Stone	$	19,823		$	20,374
Windows and Doors	1,429			(1,250		)
Unallocated	(9,426		)	(9,548		)
	$	11,826		$	9,576

	Total assets as of
	April 1, 2017			December 31, 2016
Total assets
Siding, Fencing and Stone	$	704,664		$	691,930
Windows and Doors	511,597			509,055
Unallocated	34,735			56,756
	$	1,250,996		$	1,257,741

GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION (Tables)

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

GUARANTOR / NON GUARANTOR FINANCIAL INFORMATION [Abstract]

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

Text Block

CONDENSED CONSOLIDATING BALANCE SHEET

Text Block

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

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CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS



PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
Three months ended April 1, 2017
	Guarantor			Issuer						Non-
	Ply Gem			Ply Gem			Guarantor			Guarantor			Consolidating
(Amounts in thousands)	Holdings, Inc.			Industries, Inc.			Subsidiaries			Subsidiaries			Adjustments			Consolidated
Net sales	$	—		$	—		$	389,583		$	40,432		$	—		$	430,015
Cost of products sold	—			—			308,116			32,374			—			340,490
Gross profit	—			—			81,467			8,058			—			89,525
Operating expenses:
Selling, general and
administrative expenses	—			9,426			50,609			12,320			—			72,355
Intercompany administrative
charges	—			—			14,968			125			(15,093		)	—
Amortization of intangible assets	—			—			4,290			1,054			—			5,344
Total operating expenses	—			9,426			69,867			13,499			(15,093		)	77,699
Operating earnings (loss)	—			(9,426		)	11,600			(5,441		)	15,093			11,826
Foreign currency gain	—			—			—			155			—			155
Intercompany interest	—			14,214			(13,408		)	(806		)	—			—
Interest expense	—			(16,886		)	—			—			—			(16,886		)
Interest income	—			2			8			4			—			14
Tax receivable agreement liability adjustment	—			—			—			—			—			—
Intercompany administrative income	—			15,093			—			—			(15,093		)	—
Income (loss) before equity in
subsidiaries' loss	—			2,997			(1,800		)	(6,088		)	—			(4,891		)
Equity in subsidiaries' loss	(3,637		)	(6,634		)	—			—			10,271			—
Income before provision (benefit)
for income taxes	(3,637		)	(3,637		)	(1,800		)	(6,088		)	10,271			(4,891		)
Provision (benefit) for income taxes	—			—			50			(1,304		)	—			(1,254		)
Net loss	$	(3,637	)	$	(3,637	)	$	(1,850	)	$	(4,784	)	$	10,271		$	(3,637	)

Other comprehensive income (loss):
Foreign currency translation adjustments	—			—			—			565			—			565
Unrealized loss on derivative instrument	—			—			—			(546		)	—			(546		)
Total comprehensive loss	$	(3,637	)	$	(3,637	)	$	(1,850	)	$	(4,765	)	$	10,271		$	(3,618	)

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS



PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
Three months ended April 2, 2016
	Guarantor			Issuer						Non-
	Ply Gem			Ply Gem			Guarantor			Guarantor			Consolidating
(Amounts in thousands)	Holdings, Inc.			Industries, Inc.			Subsidiaries			Subsidiary			Adjustments			Consolidated
Net sales	$	—		$	—		$	369,514		$	39,100		$	—		$	408,614
Cost of products sold	—			—			289,872			32,041			—			321,913
Gross profit	—			—			79,642			7,059			—			86,701
Operating expenses:
Selling, general and
administrative expenses	—			9,548			49,022			12,165			—			70,735
Intercompany administrative
charges	—			—			7,772			1,673			(9,445		)	—
Amortization of intangible assets	—			—			5,360			1,030			—			6,390
Total operating expenses	—			9,548			62,154			14,868			(9,445		)	77,125
Operating earnings (loss)	—			(9,548		)	17,488			(7,809		)	9,445			9,576
Foreign currency gain	—			—			—			584			—			584
Intercompany interest	—			15,933			(15,550		)	(383		)	—			—
Interest expense	—			(18,691		)	—			(1		)	—			(18,692		)
Interest income	—			2			2			6			—			10
Loss on modification or
extinguishment of debt	—			(2,399		)	—			—			—			(2,399		)
Tax receivable agreement liability adjustment	—			(18,150		)	—			—			—			(18,150		)
Intercompany administrative income	—			9,445			—			—			(9,445		)	—
Income (loss) before equity in
subsidiaries' income (loss)	—			(23,408		)	1,940			(7,603		)	—			(29,071		)
Equity in subsidiaries' income (loss)	(27,577		)	(4,169		)	—			—			31,746			—
Income (loss) before benefit
for income taxes	(27,577		)	(27,577		)	1,940			(7,603		)	31,746			(29,071		)
Benefit for income taxes	—			—			(527		)	(967		)	—			(1,494		)
Net income (loss)	$	(27,577	)	$	(27,577	)	$	2,467		$	(6,636	)	$	31,746		$	(27,577	)

Other comprehensive income (loss):
Foreign currency translation adjustments	—			—			—			4,773			—			4,773
Unrealized loss on derivative instrument	—			—			—			(1,720		)	—			(1,720		)
Total comprehensive income (loss)	$	(27,577	)	$	(27,577	)	$	2,467		$	(3,583	)	$	31,746		$	(24,524	)

CONDENSED CONSOLIDATING BALANCE SHEET



PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEET
As of April 1, 2017
(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	$	—		$	25,656		$	(10,430	)	$	5,435		$	—		$	20,661
Accounts receivable, net	—			—			194,361			21,397			—			215,758
Inventories:
Raw materials	—			—			71,947			6,672			—			78,619
Work in process	—			—			26,517			1,856			—			28,373
Finished goods	—			—			64,295			14,079			—			78,374
Total inventory	—			—			162,759			22,607			—			185,366
Prepaid expenses and other
current assets	—			3,623			18,687			3,215			—			25,525
Total current assets	—			29,279			365,377			52,654			—			447,310
Investments in subsidiaries	4,268			(190,851		)	—			—			186,583			—
Property and Equipment, at cost:
Land	—			—			7,487			770			—			8,257
Buildings and improvements	—			518			62,378			4,497			—			67,393
Machinery and equipment	—			1,980			398,676			20,185			—			420,841
	—			2,498			468,541			25,452			—			496,491
Less accumulated depreciation	—			(712		)	(318,515		)	(11,323		)	—			(330,550		)
Total property and equipment, net	—			1,786			150,026			14,129			—			165,941
Other Assets:
Intangible assets, net	—			—			87,485			11,457			—			98,942
Goodwill	—			—			449,366			29,429			—			478,795
Deferred income taxes	—			—			51,599			—			—			51,599
Intercompany note receivable	—			1,137,073			—			—			(1,137,073		)	—
Other	—			3,670			4,739			—			—			8,409
Total other assets	—			1,140,743			593,189			40,886			(1,137,073		)	637,745
	$	4,268		$	980,957		$	1,108,592		$	107,669		$	(950,490	)	$	1,250,996

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities:
Accounts payable	$	—		$	412		$	74,480		$	9,915		$	—		$	84,807
Accrued expenses	—			17,215			92,638			14,918			—			124,771
Current portion of payable to related
parties pursuant to tax receivable agreement	—			25,383			—			—			—			25,383
Current portion of long-term debt	—			4,300			—			—			—			4,300
Total current liabilities	—			47,310			167,118			24,833			—			239,261
Deferred income taxes	—			—			—			693			—			693
Intercompany note payable	—			—			1,024,779			112,294			(1,137,073		)	—
Long-term portion of payable to related
parties pursuant to tax receivable agreement	—			54,336			—			—			—			54,336
Other long-term liabilities	—			6,705			71,771			5,624			—			84,100
Long-term debt	—			868,338			—			—			—			868,338
Commitments and contingencies
Stockholders' Equity (Deficit):
Preferred stock	—			—			—			—			—			—
Common stock	684			684			—			—			(684		)	684
Additional paid-in-capital	753,911			753,911			285,075			24,158			(1,063,144		)	753,911
(Accumulated deficit) retained earnings	(717,054		)	(717,054		)	(424,472		)	(41,096		)	1,182,622			(717,054		)
Accumulated other
comprehensive loss	(33,273		)	(33,273		)	(15,679		)	(18,837		)	67,789			(33,273		)
Total stockholders' (deficit) equity	4,268			4,268			(155,076		)	(35,775		)	186,583			4,268
	$	4,268		$	980,957		$	1,108,592		$	107,669		$	(950,490	)	$	1,250,996



PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEET
As of December 31, 2016
	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	$	—		$	50,035		$	(10,918	)	$	12,480		$	—		$	51,597
Accounts receivable, net	—			—			189,983			19,936			—			209,919
Inventories:
Raw materials	—			—			63,829			5,810			—			69,639
Work in process	—			—			23,007			1,614			—			24,621
Finished goods	—			—			54,346			13,350			—			67,696
Total inventory	—			—			141,182			20,774			—			161,956
Prepaid expenses and other
current assets	—			1,276			21,940			3,634			—			26,850
Total current assets	—			51,311			342,187			56,824			—			450,322
Investments in subsidiaries	4,106			(231,236		)	—			—			227,130			—
Property and Equipment, at cost:
Land	—			—			7,487			762			—			8,249
Buildings and improvements	—			510			63,000			4,441			—			67,951
Machinery and equipment	—			1,675			392,068			19,822			—			413,565
	—			2,185			462,555			25,025			—			489,765
Less accumulated depreciation	—			(665		)	(312,759		)	(10,785		)	—			(324,209		)
Total property and equipment, net	—			1,520			149,796			14,240			—			165,556
Other Assets:
Intangible assets, net	—			—			91,748			12,411			—			104,159
Goodwill	—			—			449,366			29,148			—			478,514
Deferred income taxes	—			—			50,347						—			50,347
Intercompany note receivable	—			1,135,073			—			—			(1,135,073		)	—
Other	—			3,925			4,918			—			—			8,843
Total other assets	—			1,138,998			596,379			41,559			(1,135,073		)	641,863
	$	4,106		$	960,593		$	1,088,362		$	112,623		$	(907,943	)	$	1,257,741

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities:
Accounts payable	$	—		$	377		$	64,206		$	10,815		$	—		$	75,398
Accrued expenses	—			29,812			124,723			14,480			—			169,015
Current portion of payable to related
parties pursuant to tax receivable agreement	—			25,383			—			—			—			25,383
Current portion of long-term debt	—			4,300			—			—			—			4,300
Total current liabilities	—			59,872			188,929			25,295			—			274,096
Deferred income taxes	—			—			—			2,722			—			2,722
Intercompany note payable	—			—			1,026,657			108,416			(1,135,073		)	—
Long-term portion of payable to related
parties pursuant to tax receivable agreement	—			54,336			—			—			—			54,336
Other long-term liabilities	—			6,193			74,835			5,367			—			86,395
Long-term debt	—			836,086			—			—			—			836,086
Commitments and contingencies
Stockholders' Equity (Deficit):
Preferred stock	—			—			—			—			—			—
Common stock	683			683			—			—			(683		)	683
Additional paid-in-capital	751,452			751,452			236,242			26,464			(1,014,158		)	751,452
(Accumulated deficit) retained earnings	(714,737		)	(714,737		)	(422,622		)	(36,312		)	1,173,671			(714,737		)
Accumulated other
comprehensive loss	(33,292		)	(33,292		)	(15,679		)	(19,329		)	68,300			(33,292		)
Total stockholders' (deficit) equity	4,106			4,106			(202,059		)	(29,177		)	227,130			4,106
	$	4,106		$	960,593		$	1,088,362		$	112,623		$	(907,943	)	$	1,257,741

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS



PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
For the three months ended April 1, 2017
(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 loss	$	(3,637	)	$	(3,637	)	$	(1,850	)	$	(4,784	)	$	10,271		$	(3,637	)
Adjustments to reconcile net loss
to cash used in operating activities:
Depreciation and amortization expense	—			46			11,702			1,705			—			13,453
Non-cash restructuring costs	—			—			904			—			—			904
Non-cash interest expense, net	—			3,477			—			—			—			3,477
Gain on foreign currency transactions	—			—			—			(155		)	—			(155		)
Stock based compensation	—			259			—			—			—			259
Deferred income taxes	—			—			59			(2,226		)	—			(2,167		)
Increase in tax uncertainty	—			—			(144		)	—			—			(144		)
Equity in subsidiaries' net income (loss)	3,637			6,634			—			—			(10,271		)	—
Other	—			—			32			—			—			32
Changes in operating assets and liabilities:
Accounts receivable, net	—			—			(4,718		)	(1,126		)	—			(5,844		)
Inventories	—			—			(21,775		)	(1,643		)	—			(23,418		)
Prepaid expenses and other assets	—			(2,243		)	3,269			92			—			1,118
Accounts payable	—			35			8,368			1,011			—			9,414
Accrued expenses	—			(8,854		)	(35,943		)	809			—			(43,988		)
Cash payments on restructuring liabilities	—			—			(23		)	—			—			(23		)
Other	—			—			—			82			—			82
Net cash used in
operating activities	—			(4,283		)	(40,119		)	(6,235		)	—			(50,637		)
Cash flows from investing activities:
Capital expenditures	—			(313		)	(7,580		)	(525		)	—			(8,418		)
Proceeds from sale of assets	—			—			29			43			—			72
Net cash used in
investing activities	—			(313		)	(7,551		)	(482		)	—			(8,346		)
Cash flows from financing activities:
Net revolver borrowings	—			30,000			—			—			—			30,000
Payments on long-term debt	—			(1,075		)	—			—			—			(1,075		)
Payments to tax authority for employee share-based compensation	—			(1,186		)	—			—			—			(1,186		)
Proceeds from exercises of employee stock options	—			103			—			—			—			103
Proceeds from intercompany
investment	—			(47,625		)	48,158			(533		)	—			—
Net cash provided by (used in)
financing activities	—			(19,783		)	48,158			(533		)	—			27,842
Impact of exchange rate movements on cash	—			—			—			205			—			205
Net increase (decrease) in cash
and cash equivalents	—			(24,379		)	488			(7,045		)	—			(30,936		)
Cash and cash equivalents at the
beginning of the period	—			50,035			(10,918		)	12,480			—			51,597
Cash and cash equivalents at the end
of the period	$	—		$	25,656		$	(10,430	)	$	5,435		$	—		$	20,661

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS



PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
For the three months ended April 2, 2016
(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)	$	(27,577	)	$	(27,577	)	$	2,467		$	(6,636	)	$	31,746		$	(27,577	)
Adjustments to reconcile net income (loss)
to cash provided by (used in) operating activities:
Depreciation and amortization expense	—			61			12,379			1,590			—			14,030
Non-cash restructuring expense	—			—			—			566			—			566
Non-cash interest expense, net	—			3,416			—			—			—			3,416
Gain on foreign currency transactions	—			—			—			(584		)	—			(584		)
Loss on modification or extinguishment of debt	—			2,399			—			—			—			2,399
Stock based compensation	—			337			—			—			—			337
Deferred income taxes	—			—			65			—			—			65
Tax receivable agreement liability adjustment	—			18,150			—			—			—			18,150
Increase in tax uncertainty,
net of valuation allowance	—			—			62			—			—			62
Equity in subsidiaries' net income (loss)	27,577			4,169			—			—			(31,746		)	—
Other	—			—			138			—			—			138
Changes in operating assets and liabilities:
Accounts receivable, net	—			—			(11,718		)	2,584			—			(9,134		)
Inventories	—			—			(10,511		)	(467		)	—			(10,978		)
Prepaid expenses and other assets	—			(285		)	(68		)	98			—			(255		)
Accounts payable	—			(54		)	(3,995		)	3,174			—			(875		)
Accrued expenses	—			(13,833		)	(25,802		)	1,860			—			(37,775		)
Cash payments on restructuring liabilities	—			—			(112		)	(556		)	—			(668		)
Other	—			—			139			(2		)	—			137
Net cash provided by (used in)
operating activities	—			(13,217		)	(36,956		)	1,627			—			(48,546		)
Cash flows from investing activities:
Capital expenditures	—			(362		)	(6,946		)	(424		)	—			(7,732		)
Proceeds from sale of assets	—			—			76			—			—			76
Net cash used in
investing activities	—			(362		)	(6,870		)	(424		)	—			(7,656		)
Cash flows from financing activities:
Net revolver borrowings	—			10,000			—			—			—			10,000
Payments on long-term debt	—			(31,075		)	—			—			—			(31,075		)
Proceeds from intercompany
investment	—			(28,351		)	41,818			(13,467		)	—			—
Net cash provided by (used in)
financing activities	—			(49,426		)	41,818			(13,467		)	—			(21,075		)
Impact of exchange rate movement
on cash	—			—			—			2,193			—			2,193
Net decrease in cash
and cash equivalents	—			(63,005		)	(2,008		)	(10,071		)	—			(75,084		)
Cash and cash equivalents at the
beginning of the period	—			94,692			(4,944		)	19,677			—			109,425
Cash and cash equivalents at the end
of the period	$	—		$	31,687		$	(6,952	)	$	9,606		$	—		$	34,341

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Textuals (Details) (USD $)

In Thousands, except Share data in Millions, unless otherwise specified

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Dec. 31, 2016

Initial Public Offering [Line Items]

Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount

0.6

0.1

Allowance for Doubtful Accounts Receivable, Current

$ 2,775

$ 2,663

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Accounts Receivable (Details) (USD $)

In Thousands, unless otherwise specified

Apr. 1, 2017

Dec. 31, 2016

Accounting Policies [Abstract]

Allowance for Doubtful Accounts Receivable, Current

$ 2,775

$ 2,663

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Inventory (Details) (USD $)

In Millions, unless otherwise specified

3 Months Ended

Apr. 1, 2017

Dec. 31, 2016

Accounting Policies [Abstract]

Purchase Commitment, Remaining Minimum Amount Committed

$ 95.5

Inventory Valuation Reserves

8.5

8.4

Decrease (increase) in inventory reserve

$ 0.1

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property and Equipment (Details)

3 Months Ended

Apr. 1, 2017

Building and improvements [Member] |
Minimum [Member]

Property and Equipment [Line Items]

Estimated useful life

10 years

Building and improvements [Member] |
Maximum [Member]

Property and Equipment [Line Items]

Estimated useful life

37 years

Machinery and equipment, including leases [Member] |
Minimum [Member]

Property and Equipment [Line Items]

Estimated useful life

3 years

Machinery and equipment, including leases [Member] |
Maximum [Member]

Property and Equipment [Line Items]

Estimated useful life

15 years

Leasehold improvements [Member]

Property and Equipment [Line Items]

Property plant and equipment useful life description

Term of lease or useful life, whichever is shorter

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Acquisitions (Details) (USD $)

In Thousands, unless otherwise specified

Apr. 1, 2017

Dec. 31, 2016

Business Acquisition [Line Items]

Goodwill

$ 478,795

$ 478,514

Siding, Fencing and Stone [Member]

Business Acquisition [Line Items]

Goodwill

$ 348,745

$ 348,553

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Intangibles assets, goodwill and other long-lived assets (Details)

3 Months Ended

Apr. 1, 2017

Accounting Policies [Abstract]

Impaired Intangible Asset, Facts and Circumstances Leading to Impairment

no indicators

Goodwill, Impaired, Facts and Circumstances Leading to Impairment

no indicators

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fair Value Disclosure (Details) (USD $)

In Thousands, unless otherwise specified

Apr. 1, 2017

Dec. 31, 2016

Quoted Prices in Active Markets (Level 1) [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Liabilities

$ 676,000

Quoted Prices in Active Markets (Level 1) [Member] |
Six Point Five Senior Notes due 2022 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Liabilities

676,000

Quoted Prices in Active Markets (Level 1) [Member] |
Term Loan Facility due 2021 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Liabilities

0

Significant Other Observable Inputs (Level 2) [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Liabilities

257,743

260,757

Significant Other Observable Inputs (Level 2) [Member] |
Six Point Five Senior Notes due 2022 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Liabilities

0

Significant Other Observable Inputs (Level 2) [Member] |
Term Loan Facility due 2021 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Liabilities

257,743

260,757

Significant Unobservable Inputs (Level 3) [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Liabilities

0

Significant Unobservable Inputs (Level 3) [Member] |
Six Point Five Senior Notes due 2022 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Liabilities

0

Significant Unobservable Inputs (Level 3) [Member] |
Term Loan Facility due 2021 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Liabilities

0

Carrying Value [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Liabilities

907,100

908,175

Carrying Value [Member] |
Six Point Five Senior Notes due 2022 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Liabilities

650,000

Carrying Value [Member] |
Term Loan Facility due 2021 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Liabilities

257,100

258,175

Fair Value Total [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Liabilities

933,743

936,757

Fair Value Total [Member] |
Six Point Five Senior Notes due 2022 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Liabilities

676,000

Fair Value Total [Member] |
Term Loan Facility due 2021 [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Liabilities

$ 257,743

$ 260,757

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Earnings per share (Details) (USD $)

In Millions, unless otherwise specified

3 Months Ended

12 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Dec. 31, 2016

Accounting Policies [Abstract]

Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount

$ 55.2

$ 86.5

Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount

0.6

0.1

Income Tax Effects Allocated Directly to Equity, Cumulative Effect of Change in Accounting Principle

$ 1.3

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Foreign Currency (Details) (USD $)

In Thousands, unless otherwise specified

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Derivative [Line Items]

Foreign Currency Transaction Gain (Loss), Realized

$ 155

$ 584

Foreign currency translation adjustment

$ 565

$ 4,773

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Derivatives (Details) (USD $)

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Dec. 31, 2016

Derivatives, Fair Value [Line Items]

Foreign Currency Cash Flow Hedge Liability at Fair Value

$ 471,000

$ 962,000

Foreign Currency Cash Flow Hedge Gain (Loss) Reclassified to Earnings, Net

100,000

400,000

Foreign Exchange Forward [Member]

Derivatives, Fair Value [Line Items]

Derivative, Notional Amount

$ 31,700,000

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Debt Issuance Costs (Details) (USD $)

In Millions, unless otherwise specified

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Dec. 31, 2016

Debt Instrument [Line Items]

Unamortized Debt Issuance Expense

$ 15.7

$ 16.5

Amortization of debt issuance costs

$ 0.8

GOODWILL (Details) (USD $)

3 Months Ended

12 Months Ended

Apr. 1, 2017

reporting_unit

Apr. 2, 2016

reporting_unit

Dec. 31, 2015

Dec. 31, 2016

Goodwill [Line Items]

Goodwill, Impaired, Facts and Circumstances Leading to Impairment

no indicators

Number of reporting units

2

Goodwill impairment

$ 0

Goodwill

478,795,000

478,514,000

Siding, Fencing and Stone [Member]

Goodwill [Line Items]

Goodwill, Gross

470,972,000

470,780,000

Goodwill, Impaired, Accumulated Impairment Loss

(122,227,000)

Goodwill

348,745,000

348,553,000

Goodwill, Translation Adjustments

192,000

Windows and Doors [Member]

Goodwill [Line Items]

Goodwill, Gross

457,823,000

457,734,000

Goodwill, Impaired, Accumulated Impairment Loss

(327,773,000)

Goodwill

130,050,000

129,961,000

Goodwill, Translation Adjustments

$ 89,000

INTANGIBLE ASSETS (Details) (USD $)

In Thousands, unless otherwise specified

3 Months Ended

12 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Dec. 31, 2015

Dec. 31, 2016

Finite-Lived Intangible Assets [Line Items]

Impaired Intangible Asset, Facts and Circumstances Leading to Impairment

no indicators

Goodwill, Impaired, Facts and Circumstances Leading to Impairment

no indicators

Amortization of Intangible Assets

$ 5,344

$ 6,400

Average Amortization Period (in years)

12 years

Cost

353,685

353,416

Accumulated Amortization

(254,743)

(249,257)

Net Carrying Value

98,942

104,159

Estimated future amortization [Abstract]

2017 (remainder of year)

15,414

2016

19,935

2017

15,829

2018

11,150

2019

6,709

Patents [Member]

Finite-Lived Intangible Assets [Line Items]

Average Amortization Period (in years)

14 years

Cost

12,770

Accumulated Amortization

(12,199)

(12,078)

Net Carrying Value

571

692

Trademarks/Tradenames [Member]

Finite-Lived Intangible Assets [Line Items]

Average Amortization Period (in years)

12 years

Cost

117,142

117,124

Accumulated Amortization

(84,227)

(82,723)

Net Carrying Value

32,915

34,401

Customer relationships [Member]

Finite-Lived Intangible Assets [Line Items]

Average Amortization Period (in years)

13 years

Cost

218,108

217,861

Accumulated Amortization

(153,270)

(150,310)

Net Carrying Value

64,838

67,551

Other [Member]

Finite-Lived Intangible Assets [Line Items]

Average Amortization Period (in years)

4 years

Cost

5,665

5,661

Accumulated Amortization

(5,047)

(4,146)

Net Carrying Value

$ 618

$ 1,515

COMPREHENSIVE INCOME (LOSS) (Details) (USD $)

In Thousands, unless otherwise specified

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Statement of Comprehensive Income [Abstract]

Net loss

$ (3,637)

$ (27,577)

Foreign currency translation adjustment

565

4,773

Unrealized loss on derivative instruments

(546)

(1,720)

Total comprehensive income (loss)

$ (3,618)

$ (24,524)

LONG-TERM DEBT - Schedule of Long-term Debt (Details) (USD $)

In Thousands, unless otherwise specified

Apr. 1, 2017

Dec. 31, 2016

Debt Instrument [Line Items]

Long-term debt

$ 872,638

$ 840,386

Less current portion of long-term debt

4,300

Long-term debt, less current portion

868,338

836,086

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Debt Instrument [Line Items]

Long-term Line of Credit

30,000

0

Six Point Five Senior Notes due 2022 [Member]

Debt Instrument [Line Items]

Long-term debt

602,074

600,065

Debt Instrument, Unamortized Discount

47,926

49,935

Term Loan Facility due 2021 [Member]

Debt Instrument [Line Items]

Long-term debt

240,564

240,321

Debt Instrument, Unamortized Discount

$ 16,536

$ 17,854

LONG-TERM DEBT - 2014 Debt Transactions (Details) (USD $)

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Sep. 5, 2014

Six Point Five Senior Notes due 2022 [Member]

Jan. 23, 2015

Six Point Five Senior Notes tack on due 2022 [Member]

Debt Instrument [Line Items]

Debt Instrument, Face Amount

$ 500,000,000

$ 150,000,000

Repayments of long-term debt

$ 1,075,000

$ 31,075,000

LONG-TERM DEBT - 6.50% Senior Notes due 2022 (Details) (USD $)

3 Months Ended

Jan. 23, 2015

Six Point Five Senior Notes tack on due 2022 [Member]

Apr. 1, 2017

Six Point Five Senior Notes due 2022 [Member]

Sep. 5, 2014

Six Point Five Senior Notes due 2022 [Member]

Jan. 30, 2014

Six Point Five Senior Notes due 2022 [Member]

Apr. 1, 2017

Debt Limitation One [Member]

Six Point Five Senior Notes due 2022 [Member]

Apr. 1, 2017

Purchase Money Indebtedness [Member]

Debt Limitation Two [Member]

Six Point Five Senior Notes due 2022 [Member]

Apr. 1, 2017

Purchase Money Indebtedness [Member]

Debt Limitation Three [Member]

Six Point Five Senior Notes due 2022 [Member]

Apr. 1, 2017

Debt of Foreign Subsidiaries [Member]

Debt Limitation Two [Member]

Six Point Five Senior Notes due 2022 [Member]

Apr. 1, 2017

Debt of Foreign Subsidiaries [Member]

Debt Limitation Three [Member]

Six Point Five Senior Notes due 2022 [Member]

Apr. 1, 2017

General debt basket [Member]

Debt Limitation Two [Member]

Six Point Five Senior Notes due 2022 [Member]

Apr. 1, 2017

General debt basket [Member]

Debt Limitation Three [Member]

Six Point Five Senior Notes due 2022 [Member]

Debt Instrument [Line Items]

Debt Instrument, Face Amount

$ 150,000,000

$ 500,000,000

Debt Instrument, Maturity Date

Feb. 01, 2022

Debt Instrument, Interest Rate, Effective Percentage

8.39%

Long-term Debt, Required Interest Coverage Ratio

2.00

Maximum borrowing threshold on credit facility under six point five percent notes

350,000,000

Maximum indebtedness under six point five percent notes

575,000,000

Debt Instrument, Minimum Interest Coverage Ratio Required for Incurring Additional Debt

4.00

Purchase money indebtedness threshold under six point five percent notes

35,000,000

0.10

foreign debt threshold under the six point five percent notes

60,000,000

0.15

general debt basket threshold under the six point five percent notes

$ 75,000,000

$ 0.20

LONG-TERM DEBT - Term Loan Facility due 2021 (Details) (USD $)

3 Months Ended

0 Months Ended

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Jan. 30, 2014

Term Loan Facility due 2021 [Member]

Apr. 1, 2017

Term Loan Facility due 2021 [Member]

Nov. 4, 2016

Term Loan Facility due 2021 [Member]

Mar. 10, 2016

Term Loan Facility due 2021 [Member]

Apr. 1, 2017

Ply Gem Industries [Member]

Term Loan Facility due 2021 [Member]

Base Rate [Member]

Apr. 1, 2017

Ply Gem Industries [Member]

Term Loan Facility due 2021 [Member]

Libor Rate [Member]

Apr. 1, 2017

Ply Gem Industries [Member]

Term Loan Facility due 2021 [Member]

Interest Rate Floor [Member]

Apr. 1, 2017

Ply Gem Industries [Member]

Term Loan Facility due 2021 [Member]

eurocurrency loan [Member]

Apr. 1, 2017

Ply Gem Industries [Member]

Term Loan Facility due 2021 [Member]

alternate base rate loan [Member]

Apr. 1, 2017

Option Two [Member]

Ply Gem Industries [Member]

Term Loan Facility due 2021 [Member]

Apr. 1, 2017

Option One [Member]

Ply Gem Industries [Member]

Term Loan Facility due 2021 [Member]

Apr. 1, 2017

certain non-ordinary course asset sales [Member]

Term Loan Facility due 2021 [Member]

Apr. 1, 2017

excess cash flow [Member]

Option Two [Member]

Term Loan Facility due 2021 [Member]

Apr. 1, 2017

excess cash flow [Member]

Option One [Member]

Term Loan Facility due 2021 [Member]

Apr. 1, 2017

excess cash flow [Member]

Option Three [Member] [Member]

Term Loan Facility due 2021 [Member]

Apr. 1, 2017

certain issuances of debt [Member]

Term Loan Facility due 2021 [Member]

Dec. 31, 2016

senior secured debt ratio [Member]

Term Loan Facility due 2021 [Member]

Nov. 4, 2016

Term Loan Facility due 2021 [Member]

Debt Instrument [Line Items]

Gains (Losses) on Extinguishment of Debt

$ 0

$ (2,399,000)

Debt Instrument, Face Amount

430,000,000

Debt Instrument, Unamortized Discount

2,200,000

Proceeds from Debt, Net of Issuance Costs

427,900,000

Debt Instrument, Maturity Date

Jan. 30, 2021

debt instrument, periodic payment, principal, percentage basis

1.00%

Debt Instrument, Basis Spread on Variable Rate

0.50%

1.00%

3.00%

2.00%

Debt Instrument, Interest Rate, Stated Percentage

4.00%

Debt Instrument, Interest Rate, Effective Percentage

8.78%

Accordion Feature Line Increase, Remaining Availability

140,000,000

accordion feature line increase ratio threshold

3.75

term loan repayment requirements

25.00%

50.00%

0.00%

Long-term Debt, Required secured debt Ratio

2.00

2.50

0.93

excess cash flow threshold for prepayment

15,000,000

excess cash flow subject to prepayment

100.00%

Long-term Debt, Term Loan Voluntary Repayment

$ 100,000,000

$ 30,000,000.00

$ 160,000,000

LONG-TERM DEBT - Senior secured asset based revolving credit facility due 2020 (Details) (USD $)

12 Months Ended

3 Months Ended

4 Months Ended

3 Months Ended

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Dec. 31, 2016

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Nov. 5, 2014

Senior Secured Asset-Based Revolving Credit Facility due 2016 [Member]

Dec. 31, 2015

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Nov. 5, 2015

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Ply Gem Industries [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Ply Gem Industries [Member]

Base Rate [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Ply Gem Industries [Member]

Eurodollar [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Ply Gem Canada [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Minimum [Member]

Ply Gem Industries [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Maximum [Member]

Ply Gem Industries [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

initial base rate [Member]

Ply Gem Industries [Member]

Base Rate [Member]

Nov. 5, 2015

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

remaining available [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Threshold for fee calculation [Member]

Ply Gem Industries [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Option Two [Member]

Ply Gem Industries [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Option One [Member]

Ply Gem Industries [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Fixed Charge Coverage Ratio [Member]

Ply Gem Industries [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Option Three [Member] [Member]

Cash Dominion Requirement [Member]

Ply Gem Industries [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Option Two [Member]

Cash Dominion Requirement [Member]

Ply Gem Industries [Member]

Apr. 30, 2014

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Option Two [Member]

Cash Dominion Requirement [Member]

Ply Gem Industries [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Option Two [Member]

Fixed Charge Coverage Ratio [Member]

Ply Gem Industries [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Option One [Member]

Cash Dominion Requirement [Member]

Ply Gem Industries [Member]

Apr. 1, 2017

Senior Secured Asset-Based Revolving Credit Facility due 2020 [Member]

Option One [Member]

Fixed Charge Coverage Ratio [Member]

Ply Gem Industries [Member]

Debt Instrument [Line Items]

Line of Credit Facility, Maximum Borrowing Capacity

$ 300,000,000

$ 350,000,000

$ 300,000,000

$ 50,000,000

Debt Issuance Cost

1,500,000

Accordion Feature Line Increase, Amount

50,000,000

Debt Instrument, Basis Spread on Variable Rate

0.50%

1.50%

1.25%

2.00%

0.50%

Line of Credit Facility, Unused Capacity, Commitment Fee Percentage

0.25%

0.375%

Line of Credit Facility, Commitment Fee Amount

100,000,000

Line of Credit Facility, Interest Rate During Period

2.32%

Debt Instrument, Excess Availability

30,000,000

27,500,000

25,000,000

Long-term Debt, Required Interest Coverage Ratio

1.0

Debt Instrument, thresholds excess availability must exceed

12.50%

10.00%

Debt Instrument, Excess Availability length

5 years

Percentage of equity guaranteed by parent company

35.00%

Line of Credit Facility, Current Borrowing Capacity

310,300,000

Line of Credit Facility, Remaining Borrowing Capacity

207,300,000

Long-term Line of Credit

30,000,000

0

Letters of Credit Outstanding, Amount

$ 9,700,000

LONG-TERM DEBT - Loss on debt modification or extinguishment (Details) (USD $)

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Dec. 31, 2016

Apr. 1, 2017

Term Loan Facility due 2021 [Member]

Dec. 31, 2016

Term Loan Facility due 2021 [Member]

Apr. 1, 2017

Term Loan Facility due 2021 [Member]

Apr. 2, 2016

Term Loan Facility due 2021 [Member]

Nov. 4, 2016

Term Loan Facility due 2021 [Member]

Mar. 10, 2016

Term Loan Facility due 2021 [Member]

Jan. 30, 2014

Term Loan Facility due 2021 [Member]

Nov. 4, 2016

Term Loan Facility due 2021 [Member]

Debt Instrument [Line Items]

Gains (Losses) on Extinguishment of Debt

$ 0

$ 2,399,000

Long-term Debt, Term Loan Voluntary Repayment

100,000,000

30,000,000.00

160,000,000

Debt Instrument, Unamortized Discount

16,536,000

17,854,000

2,200,000

Unamortized Debt Issuance Expense

15,700,000

16,500,000

Estinguishment of Debt, Unamortized Discount Charged to Expense

0

1,915,000

Write off of Deferred Debt Issuance Cost

$ 0

$ 484,000

PENSION PLANS (Details) (USD $)

In Thousands, unless otherwise specified

3 Months Ended

Apr. 1, 2017

pension_plan

Apr. 2, 2016

Compensation and Retirement Disclosure [Abstract]

Number of separate pension plans

2

Net periodic benefit costs

Service cost

$ 0

Interest cost

459

486

Expected return on plan assets

(546)

(545)

Amortization of loss

351

354

Net periodic benefit expense

$ 264

$ 295

COMMITMENTS AND CONTINGENCIES (Details) (USD $)

12 Months Ended

3 Months Ended

Apr. 1, 2017

Dec. 31, 2016

Apr. 1, 2017

Indemnification Agreement [Member]

Dec. 31, 2016

Indemnification Agreement [Member]

Dec. 31, 2011

Windows and Doors [Member]

Apr. 1, 2017

Windows and Doors [Member]

Apr. 1, 2017

Ply Gem Canada [Member]

Apr. 1, 2017

indemnification of liabilities in excess of [Member]

Apr. 1, 2017

Warranty claims [Member]

Apr. 2, 2016

Warranty claims [Member]

Indemnification [Abstract]

Receivable related to indemnification

$ 1,400,000

Loss Contingency, Accrual, Current

2,575,000

500,000

Long-term liabilities related to indemnifications

731,000

900,000

Product claim liabilities

138,000

Multi-employer pension plan withdrawal liability

718,000

808,000

Other

497,000

500,000

2,500,000

Liabilities for contingency

1,353,000

1,446,000

Warranty claims [Abstract]

Warranty liabilities, Current

20,189,000

19,718,000

Warranty liabilities, Noncurrent

58,262,000

57,575,000

Change in the Company's warranty liabilities [Roll Forward]

Balance, beginning of period

77,293,000

76,562,000

Warranty expense during period

6,166,000

5,512,000

Settlements made during period

(5,008,000)

(4,613,000)

Balance, end of period

78,451,000

77,461,000

Environmental [Abstract]

Environmental remediation estimate

1,800,000

Environmental liability within current liabilities

300,000

100,000

Environmental liability within other long-term liabilities

$ 1,200,000

ACCRUED EXPENSES AND OTHER LONG-TERM LIABILITIES (Details) (USD $)

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Dec. 31, 2016

Accrued expenses [Abstract]

Insurance

$ 8,493,000

$ 8,297,000

Employee compensation and benefits

17,384,000

27,749,000

Sales and marketing

29,140,000

59,655,000

Product warranty

20,189,000

19,718,000

Accrued freight

2,664,000

2,146,000

Accrued interest

7,286,000

17,977,000

Accrued environmental liability

435,000

434,000

Accrued pension

1,753,000

Accrued sales returns and discounts

1,418,000

1,199,000

Accrued taxes

5,605,000

4,966,000

Loss Contingency, Accrual, Current

2,575,000

Long-term liabilities related to indemnifications

731,000

Other

27,829,000

22,546,000

Accrued expenses

124,771,000

169,015,000

Other long-term liabilities [Abstract]

Insurance

597,000

605,000

Pension liabilities

13,958,000

13,907,000

Multi-employer pension plan withdrawal liability

718,000

808,000

Product warranty

58,262,000

57,575,000

Long-term product claim liability

138,000

Long-term environmental liability

1,158,000

Liabilities for tax uncertainties

3,781,000

3,925,000

Other

4,757,000

7,548,000

Other long-term liabilities

84,100,000

86,395,000

Long term incentive plan expense

1,400,000

1,700,000

Long term incentive plan liabilities

5,100,000

10,000,000

Other Employee Related Liabilities, Current

4,300,000

6,300,000

other employee related liabilities, noncurrent

800,000

3,700,000

Conversion of Stock, Shares Issued

129,176

Shares Issued, Price Per Share

$ 16.25

LTIP grant payment

3,300,000

Payments Related to Tax Withholding for Share-based Compensation

$ 1,186,000

$ 0

INCOME TAXES (Details) (USD $)

3 Months Ended

12 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Dec. 31, 2016

May 22, 2013

Income Tax Contingency [Line Items]

Estimated effective income tax rate

40.30%

Estimated effective income tax rate including discrete items

25.60%

Tax expense

$ 1,300,000

$ 1,500,000

Unrecognized Tax Benefits, Interest on Income Taxes Expense

100,000

Liability for Uncertain Tax Positions, Noncurrent

3,781,000

3,925,000

Unrecognized Tax Benefits

16,400,000

TRA payment value, percentage

85.00%

TRA retained value, percentage

15.00%

Tax receivable agreement adjustment

0

18,150,000

tax receivable agreement payable

79,700,000

54,336,000

tax receivable agreement payable unrecognized

4,700,000

Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount

55,200,000

86,500,000

Tax receivable agreement payable - noncurrent

54,336,000

Current portion of payable to related parties pursuant to tax receivable agreement

25,383,000

estimate of maximum liability [Member]

Income Tax Contingency [Line Items]

tax receivable agreement payable

84,400,000

Valuation Allowance, Other Tax Carryforward [Member]

Income Tax Contingency [Line Items]

Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount

$ 31,300,000

INCOME TAXES tax uncertainties (Details) (USD $)

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Dec. 31, 2016

Income Tax Contingency [Line Items]

Unrecognized Tax Benefits, Reduction Resulting from Lapse of Applicable Statute of Limitations

$ 100,000

Current Income Tax Expense (Benefit)

(1,300,000)

(1,500,000)

Liability for Uncertain Tax Positions, Noncurrent

3,781,000

3,925,000

Unrecognized Tax Benefits

$ 16,400,000

STOCK-BASED COMPENSATION (Details) (USD $)

In Millions, except Share data, unless otherwise specified

3 Months Ended

12 Months Ended

3 Months Ended

0 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Apr. 1, 2017

Stock Options [Member]

Dec. 31, 2015

Stock Options [Member]

Apr. 1, 2017

Restricted Stock [Member]

Board of Directors [Member]

Apr. 2, 2016

Restricted Stock [Member]

Board of Directors [Member]

Dec. 6, 2016

Restricted Stock [Member]

December Award [Member]

member_of_board_of_directors

Dec. 11, 2015

Restricted Stock [Member]

December Award [Member]

member_of_board_of_directors

Dec. 6, 2016

Restricted Stock [Member]

December Award [Member]

Board of Directors [Member]

Dec. 11, 2015

Restricted Stock [Member]

December Award [Member]

Board of Directors [Member]

Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]

Stock options outstanding at beginning of period (in shares)

2,495,533

Granted

0

Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price

$ 0.00

Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period

(8,334)

Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price

$ 12.35

Forfeited or expired (in shares)

0

Stock options outstanding at end of period (in shares)

2,487,199

Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward]

Weighted average exercise price at beginning of period (in dollars per share)

$ 13.96

Weighted average exercise price at end of period (in dollars per share)

$ 13.96

Weighted average remaining contractual term

4 years 1 month 5 days

4 years 4 months 5 days

Vested options (in shares)

2,379,637

Vesting percentage (in hundredths)

100.00%

Total unrecognized compensation expense

$ 0.4

Weighted average recognition period of unrecognized compensation expense

0 years 11 months 28 days

Restricted Stock [Abstract]

Restricted shares

19,420

25,664

Independent members of the Board of Directors receiving award

4

Compensation expense

$ 0.2

$ 0.3

$ 0.1

Share-based Compensation Arrangements by Share-based Payment Award, Options, Forfeitures in Period, Weighted Average Exercise Price

$ 0

SEGMENT INFORMATION (Details) (USD $)

In Thousands, unless otherwise specified

3 Months Ended

Apr. 1, 2017

segment

Apr. 2, 2016

segment

Dec. 31, 2016

Segment Reporting Information [Line Items]

Reportable segments

2

Net sales

$ 430,015

$ 408,614

Operating earnings (loss)

11,826

9,576

Total assets

1,250,996

1,257,741

Siding, Fencing and Stone [Member]

Segment Reporting Information [Line Items]

Net sales

190,837

176,376

Operating earnings (loss)

19,823

20,374

Total assets

704,664

691,930

Windows and Doors [Member]

Segment Reporting Information [Line Items]

Net sales

239,178

232,238

Operating earnings (loss)

1,429

(1,250)

Total assets

511,597

509,055

Unallocated [Member]

Segment Reporting Information [Line Items]

Operating earnings (loss)

(9,426)

(9,548)

Total assets

$ 34,735

$ 56,756

RELATED PARTY TRANSACTIONS (Details) (USD $)

In Millions, unless otherwise specified

Apr. 1, 2017

Dec. 31, 2016

2015 agreement [Member] |
Chief Executive Officer [Member]

Related Party Transaction [Line Items]

Due to Officers or Stockholders

$ 3.0

2015 agreement [Member] |
Chief Financial Officer [Member]

Related Party Transaction [Line Items]

Due to Officers or Stockholders

1.3

2015 agreement [Member] |
All retention payments [Member]

Related Party Transaction [Line Items]

Due to Officers or Stockholders

4.3

Accrued Liabilities [Member]

Related Party Transaction [Line Items]

Retention Payable

$ 3.2

$ 2.8

GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION, Condensed Consolidating Statements of Operations (Details) (USD $)

In Thousands, unless otherwise specified

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS [Abstract]

Net sales

$ 430,015

$ 408,614

Cost of products sold

340,490

321,913

Gross profit

89,525

86,701

Operating expenses:

Selling, general and administrative expenses

72,355

70,735

Intercompany administrative charges

0

Amortization of intangible assets

5,344

6,400

Total operating expenses

77,699

77,125

Operating earnings

11,826

9,576

Foreign currency (loss) gain

155

584

Intercompany interest

0

Interest expense

(16,886)

(18,692)

Interest income

14

10

Tax receivable agreement liability adjustment

0

(18,150)

Gains (Losses) on Extinguishment of Debt

0

2,399

Intercompany administrative income

0

Income (Loss) from Operations before Extraordinary Items

(4,891)

(29,071)

Equity in subsidiaries' loss

0

Income (Loss) before provision (benefit) for income taxes

(4,891)

(29,071)

Provision (benefit) for income taxes

(1,254)

(1,494)

Net income (loss)

(3,637)

(27,577)

Other comprehensive income (loss):

Currency translation adjustment

565

4,773

Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net

(1,720)

Unrealized loss on derivative instruments

(546)

(1,720)

Total comprehensive income (loss)

(3,618)

(24,524)

Guarantor Ply Gem Holdings, Inc. [Member]

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS [Abstract]

Net sales

0

Cost of products sold

0

Gross profit

0

Operating expenses:

Selling, general and administrative expenses

0

Intercompany administrative charges

0

Amortization of intangible assets

0

Total operating expenses

0

Operating earnings

0

Foreign currency (loss) gain

0

Intercompany interest

0

Interest expense

0

Interest income

0

Tax receivable agreement liability adjustment

0

Gains (Losses) on Extinguishment of Debt

0

Intercompany administrative income

0

Income (Loss) from Operations before Extraordinary Items

0

Equity in subsidiaries' loss

(3,637)

(27,577)

Income (Loss) before provision (benefit) for income taxes

(3,637)

(27,577)

Provision (benefit) for income taxes

0

Net income (loss)

(3,637)

(27,577)

Other comprehensive income (loss):

Currency translation adjustment

0

Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net

0

Unrealized loss on derivative instruments

0

Total comprehensive income (loss)

(3,637)

(27,577)

Subsidiary Issuer [Member]

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS [Abstract]

Net sales

0

Cost of products sold

0

Gross profit

0

Operating expenses:

Selling, general and administrative expenses

9,426

9,548

Intercompany administrative charges

0

Amortization of intangible assets

0

Total operating expenses

9,426

9,548

Operating earnings

(9,426)

(9,548)

Foreign currency (loss) gain

0

Intercompany interest

14,214

15,933

Interest expense

(16,886)

(18,691)

Interest income

2

Tax receivable agreement liability adjustment

0

(18,150)

Intercompany administrative income

15,093

9,445

Income (Loss) from Operations before Extraordinary Items

2,997

(23,408)

Equity in subsidiaries' loss

(6,634)

(4,169)

Income (Loss) before provision (benefit) for income taxes

(3,637)

(27,577)

Provision (benefit) for income taxes

0

Net income (loss)

(3,637)

(27,577)

Other comprehensive income (loss):

Currency translation adjustment

0

Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net

0

Unrealized loss on derivative instruments

0

Total comprehensive income (loss)

(3,637)

(27,577)

Guarantor Subsidiaries [Member]

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS [Abstract]

Net sales

389,583

369,514

Cost of products sold

308,116

289,872

Gross profit

81,467

79,642

Operating expenses:

Selling, general and administrative expenses

50,609

49,022

Intercompany administrative charges

14,968

7,772

Amortization of intangible assets

4,290

5,360

Total operating expenses

69,867

62,154

Operating earnings

11,600

17,488

Foreign currency (loss) gain

0

Intercompany interest

(13,408)

(15,550)

Interest expense

0

Interest income

8

2

Tax receivable agreement liability adjustment

0

Gains (Losses) on Extinguishment of Debt

0

Intercompany administrative income

0

Income (Loss) from Operations before Extraordinary Items

(1,800)

1,940

Equity in subsidiaries' loss

0

Income (Loss) before provision (benefit) for income taxes

(1,800)

1,940

Provision (benefit) for income taxes

50

(527)

Net income (loss)

(1,850)

2,467

Other comprehensive income (loss):

Currency translation adjustment

0

Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net

0

Unrealized loss on derivative instruments

0

Total comprehensive income (loss)

(1,850)

2,467

Non-Guarantor Subsidiary [Member]

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS [Abstract]

Net sales

40,432

39,100

Cost of products sold

32,374

32,041

Gross profit

8,058

7,059

Operating expenses:

Selling, general and administrative expenses

12,320

12,165

Intercompany administrative charges

125

1,673

Amortization of intangible assets

1,054

1,030

Total operating expenses

13,499

14,868

Operating earnings

(5,441)

(7,809)

Foreign currency (loss) gain

155

584

Intercompany interest

(806)

(383)

Interest expense

0

(1)

Interest income

4

6

Tax receivable agreement liability adjustment

0

Gains (Losses) on Extinguishment of Debt

0

Intercompany administrative income

0

Income (Loss) from Operations before Extraordinary Items

(6,088)

(7,603)

Equity in subsidiaries' loss

0

Income (Loss) before provision (benefit) for income taxes

(6,088)

(7,603)

Provision (benefit) for income taxes

(1,304)

(967)

Net income (loss)

(4,784)

(6,636)

Other comprehensive income (loss):

Currency translation adjustment

565

Unrealized loss on derivative instruments

(546)

Total comprehensive income (loss)

(4,765)

(3,583)

Consolidating Adjustments [Member]

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS [Abstract]

Net sales

0

Cost of products sold

0

Gross profit

0

Operating expenses:

Selling, general and administrative expenses

0

Intercompany administrative charges

(15,093)

(9,445)

Amortization of intangible assets

0

Total operating expenses

(15,093)

(9,445)

Operating earnings

15,093

9,445

Foreign currency (loss) gain

0

Intercompany interest

0

Interest expense

0

Interest income

0

Tax receivable agreement liability adjustment

0

Gains (Losses) on Extinguishment of Debt

0

Intercompany administrative income

(15,093)

(9,445)

Income (Loss) from Operations before Extraordinary Items

0

Equity in subsidiaries' loss

10,271

31,746

Income (Loss) before provision (benefit) for income taxes

10,271

31,746

Provision (benefit) for income taxes

0

Net income (loss)

10,271

31,746

Other comprehensive income (loss):

Currency translation adjustment

0

Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net

0

Unrealized loss on derivative instruments

0

Total comprehensive income (loss)

$ 10,271

$ 31,746

GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION, Condensed Consolidating Balance Sheet (Details) (USD $)

In Thousands, unless otherwise specified

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Dec. 31, 2016

Dec. 31, 2015

Proceeds from (Repayments of) Lines of Credit

$ 30,000

$ 10,000

Current Assets:

Cash and cash equivalents

20,661

34,341

51,597

109,425

Accounts receivable, net

215,758

209,919

Inventories:

Raw materials

78,619

69,639

Work in process

28,373

24,621

Finished goods

78,374

67,696

Total inventory

185,366

161,956

Prepaid expenses and other current assets

25,525

26,850

Total current assets

447,310

450,322

Investments in subsidiaries

0

Property and Equipment, at cost:

Land

8,257

8,249

Buildings and improvements

67,393

67,951

Machinery and equipment

420,841

413,565

Total property and equipment

496,491

489,765

Less accumulated depreciation

(330,550)

(324,209)

Total property and equipment, net

165,941

165,556

Other Assets:

Intangible assets, net

98,942

104,159

Goodwill

478,795

478,514

Deferred Tax Assets, Net of Valuation Allowance, Noncurrent

51,599

50,347

Intercompany note receivable

0

Other

8,409

8,843

Total other assets

637,745

641,863

Total Assets

1,250,996

1,257,741

Current Liabilities:

Less current portion of long-term debt

4,300

Accounts payable

84,807

75,398

Accrued expenses

124,771

169,015

Current portion of payable to related parties pursuant to tax receivable agreement

25,383

Total current liabilities

239,261

274,096

Deferred income taxes

693

2,722

Intercompany note payable

0

tax receivable agreement payable

79,700

54,336

Tax receivable agreement payable - noncurrent

54,336

Other long-term liabilities

84,100

86,395

Long-term debt, less current portion

868,338

836,086

Commitments and contingencies

Stockholders' Equity (Deficit):

Preferred stock

0

Common stock

684

683

Additional paid-in-capital

753,911

751,452

(Accumulated deficit) retained earnings

(717,054)

(714,737)

Accumulated other comprehensive loss

(33,273)

(33,292)

Total stockholders' equity

4,268

4,106

Total Liabilities and Stockholder's Deficit

1,250,996

1,257,741

Guarantor Ply Gem Holdings, Inc. [Member]

Proceeds from (Repayments of) Lines of Credit

0

Current Assets:

Cash and cash equivalents

0

Accounts receivable, net

0

Inventories:

Raw materials

0

Work in process

0

Finished goods

0

Total inventory

0

Prepaid expenses and other current assets

0

Total current assets

0

Investments in subsidiaries

4,268

4,106

Property and Equipment, at cost:

Land

0

Buildings and improvements

0

Machinery and equipment

0

Total property and equipment

0

Less accumulated depreciation

0

Total property and equipment, net

0

Other Assets:

Intangible assets, net

0

Goodwill

0

Deferred Tax Assets, Net of Valuation Allowance, Noncurrent

0

Intercompany note receivable

0

Other

0

Total other assets

0

Total Assets

4,268

4,106

Current Liabilities:

Less current portion of long-term debt

0

Accounts payable

0

Accrued expenses

0

Current portion of payable to related parties pursuant to tax receivable agreement

0

Total current liabilities

0

Deferred income taxes

0

Intercompany note payable

0

tax receivable agreement payable

0

Tax receivable agreement payable - noncurrent

0

Other long-term liabilities

0

Long-term debt, less current portion

0

Commitments and contingencies

Stockholders' Equity (Deficit):

Preferred stock

0

Common stock

684

683

Additional paid-in-capital

753,911

751,452

(Accumulated deficit) retained earnings

(717,054)

(714,737)

Accumulated other comprehensive loss

(33,273)

(33,292)

Total stockholders' equity

4,268

4,106

Total Liabilities and Stockholder's Deficit

4,268

4,106

Subsidiary Issuer [Member]

Proceeds from (Repayments of) Lines of Credit

30,000

10,000

Current Assets:

Cash and cash equivalents

25,656

31,687

50,035

94,692

Accounts receivable, net

0

Inventories:

Raw materials

0

Work in process

0

Finished goods

0

Total inventory

0

Prepaid expenses and other current assets

3,623

1,276

Total current assets

29,279

51,311

Investments in subsidiaries

(190,851)

(231,236)

Property and Equipment, at cost:

Land

0

Buildings and improvements

518

510

Machinery and equipment

1,980

1,675

Total property and equipment

2,498

2,185

Less accumulated depreciation

(712)

(665)

Total property and equipment, net

1,786

1,520

Other Assets:

Intangible assets, net

0

Goodwill

0

Deferred Tax Assets, Net of Valuation Allowance, Noncurrent

0

Intercompany note receivable

1,137,073

1,135,073

Other

3,670

3,925

Total other assets

1,140,743

1,138,998

Total Assets

980,957

960,593

Current Liabilities:

Less current portion of long-term debt

4,300

Accounts payable

412

377

Accrued expenses

17,215

29,812

Current portion of payable to related parties pursuant to tax receivable agreement

25,383

Total current liabilities

47,310

59,872

Deferred income taxes

0

Intercompany note payable

0

tax receivable agreement payable

54,336

Tax receivable agreement payable - noncurrent

54,336

Other long-term liabilities

6,705

6,193

Long-term debt, less current portion

868,338

836,086

Commitments and contingencies

Stockholders' Equity (Deficit):

Preferred stock

0

Common stock

684

683

Additional paid-in-capital

753,911

751,452

(Accumulated deficit) retained earnings

(717,054)

(714,737)

Accumulated other comprehensive loss

(33,273)

(33,292)

Total stockholders' equity

4,268

4,106

Total Liabilities and Stockholder's Deficit

980,957

960,593

Guarantor Subsidiaries [Member]

Proceeds from (Repayments of) Lines of Credit

0

Current Assets:

Cash and cash equivalents

(10,430)

(6,952)

(10,918)

(4,944)

Accounts receivable, net

194,361

189,983

Inventories:

Raw materials

71,947

63,829

Work in process

26,517

23,007

Finished goods

64,295

54,346

Total inventory

162,759

141,182

Prepaid expenses and other current assets

18,687

21,940

Total current assets

365,377

342,187

Investments in subsidiaries

0

Property and Equipment, at cost:

Land

7,487

Buildings and improvements

62,378

63,000

Machinery and equipment

398,676

392,068

Total property and equipment

468,541

462,555

Less accumulated depreciation

(318,515)

(312,759)

Total property and equipment, net

150,026

149,796

Other Assets:

Intangible assets, net

87,485

91,748

Goodwill

449,366

Deferred Tax Assets, Net of Valuation Allowance, Noncurrent

51,599

50,347

Intercompany note receivable

0

Other

4,739

4,918

Total other assets

593,189

596,379

Total Assets

1,108,592

1,088,362

Current Liabilities:

Less current portion of long-term debt

0

Accounts payable

74,480

64,206

Accrued expenses

92,638

124,723

Current portion of payable to related parties pursuant to tax receivable agreement

0

Total current liabilities

167,118

188,929

Deferred income taxes

0

Intercompany note payable

1,024,779

1,026,657

tax receivable agreement payable

0

Tax receivable agreement payable - noncurrent

0

Other long-term liabilities

71,771

74,835

Long-term debt, less current portion

0

Commitments and contingencies

Stockholders' Equity (Deficit):

Preferred stock

0

Common stock

0

Additional paid-in-capital

285,075

236,242

(Accumulated deficit) retained earnings

(424,472)

(422,622)

Accumulated other comprehensive loss

(15,679)

Total stockholders' equity

(155,076)

(202,059)

Total Liabilities and Stockholder's Deficit

1,108,592

1,088,362

Non-Guarantor Subsidiary [Member]

Proceeds from (Repayments of) Lines of Credit

0

Current Assets:

Cash and cash equivalents

5,435

9,606

12,480

19,677

Accounts receivable, net

21,397

19,936

Inventories:

Raw materials

6,672

5,810

Work in process

1,856

1,614

Finished goods

14,079

13,350

Total inventory

22,607

20,774

Prepaid expenses and other current assets

3,215

3,634

Total current assets

52,654

56,824

Investments in subsidiaries

0

Property and Equipment, at cost:

Land

770

762

Buildings and improvements

4,497

4,441

Machinery and equipment

20,185

19,822

Total property and equipment

25,452

25,025

Less accumulated depreciation

(11,323)

(10,785)

Total property and equipment, net

14,129

14,240

Other Assets:

Intangible assets, net

11,457

12,411

Goodwill

29,429

29,148

Deferred Tax Assets, Net of Valuation Allowance, Noncurrent

0

Intercompany note receivable

0

Other

0

Total other assets

40,886

41,559

Total Assets

107,669

112,623

Current Liabilities:

Less current portion of long-term debt

0

Accounts payable

9,915

10,815

Accrued expenses

14,918

14,480

Current portion of payable to related parties pursuant to tax receivable agreement

0

Total current liabilities

24,833

25,295

Deferred income taxes

693

2,722

Intercompany note payable

112,294

108,416

tax receivable agreement payable

0

Tax receivable agreement payable - noncurrent

0

Other long-term liabilities

5,624

5,367

Long-term debt, less current portion

0

Commitments and contingencies

Stockholders' Equity (Deficit):

Preferred stock

0

Common stock

0

Additional paid-in-capital

24,158

26,464

(Accumulated deficit) retained earnings

(41,096)

(36,312)

Accumulated other comprehensive loss

(18,837)

(19,329)

Total stockholders' equity

(35,775)

(29,177)

Total Liabilities and Stockholder's Deficit

107,669

112,623

Guarantor Ply Gem Holdings, Inc. [Member]

Other Assets:

Deferred Tax Assets, Net of Valuation Allowance, Noncurrent

0

Issuer Ply Gem Industries, Inc. [Member]

Other Assets:

Deferred Tax Assets, Net of Valuation Allowance, Noncurrent

0

Consolidation, Eliminations [Member]

Proceeds from (Repayments of) Lines of Credit

0

Current Assets:

Cash and cash equivalents

0

Accounts receivable, net

0

Inventories:

Raw materials

0

Work in process

0

Finished goods

0

Total inventory

0

Prepaid expenses and other current assets

0

Total current assets

0

Investments in subsidiaries

186,583

227,130

Property and Equipment, at cost:

Land

0

Buildings and improvements

0

Machinery and equipment

0

Total property and equipment

0

Less accumulated depreciation

0

Total property and equipment, net

0

Other Assets:

Intangible assets, net

0

Goodwill

0

Deferred Tax Assets, Net of Valuation Allowance, Noncurrent

0

Intercompany note receivable

(1,137,073)

(1,135,073)

Other

0

Total other assets

(1,137,073)

(1,135,073)

Total Assets

(950,490)

(907,943)

Current Liabilities:

Less current portion of long-term debt

0

Accounts payable

0

Accrued expenses

0

Current portion of payable to related parties pursuant to tax receivable agreement

0

Total current liabilities

0

Deferred income taxes

0

Intercompany note payable

(1,137,073)

(1,135,073)

tax receivable agreement payable

0

Tax receivable agreement payable - noncurrent

0

Other long-term liabilities

0

Long-term debt, less current portion

0

Commitments and contingencies

Stockholders' Equity (Deficit):

Preferred stock

0

Common stock

(684)

(683)

Additional paid-in-capital

(1,063,144)

(1,014,158)

(Accumulated deficit) retained earnings

1,182,622

1,173,671

Accumulated other comprehensive loss

67,789

68,300

Total stockholders' equity

186,583

227,130

Total Liabilities and Stockholder's Deficit

$ (950,490)

$ (907,943)

GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION, Condensed Consolidating Statement of Cash Flows (Details) (USD $)

In Thousands, unless otherwise specified

3 Months Ended

Apr. 1, 2017

Apr. 2, 2016

Cash flows from operating activities:

Net loss

$ (3,637)

$ (27,577)

Adjustments to reconcile net loss to cash provided by (used in) operating activities:

Depreciation and amortization expense

13,453

14,030

Restructuring Costs

904

566

Non-cash interest expense, net

3,477

3,416

(Gain) Loss on foreign currency transactions

155

584

Gains (Losses) on Extinguishment of Debt

0

2,399

Stock based compensation

259

337

Deferred income taxes

(2,167)

65

Tax receivable agreement liability adjustment

0

(18,150)

(Decrease) increase in tax uncertainty, net of valuation allowance

(144)

62

Equity Income In Consolidated Subsidiaries

0

Other

(32)

(138)

Changes in operating assets and liabilities:

Accounts receivable, net

5,844

9,134

Inventories

(23,418)

(10,978)

Prepaid expenses and other assets

1,118

(255)

Accounts payable

9,414

(875)

Accrued expenses

(43,988)

(37,775)

Cash payments on restructuring liabilities

(23)

(668)

Other

82

137

Net cash used in operating activities

(50,637)

(48,546)

Payments to Acquire Productive Assets

8,418

7,732

Proceeds from sale of assets

72

76

Net cash used in investing activities

(8,346)

(7,656)

Cash flows from financing activities:

Net revolver borrowings

30,000

10,000

Payments on long-term debt

(1,075)

(31,075)

Payments Related to Tax Withholding for Share-based Compensation

(1,186)

0

Proceeds from Stock Options Exercised

103

0

Proceeds from intercompany investment

0

Net cash provided by (used in) financing activities

27,842

(21,075)

Impact of exchange rate movements on cash

205

2,193

Net decrease in cash and cash equivalents

(30,936)

(75,084)

Cash and cash equivalents at the beginning of the period

51,597

109,425

Cash and cash equivalents at the end of the period

20,661

34,341

Gains (Losses) On Modification Or Extinguishment Of Debt

(2,399)

Guarantor Ply Gem Holdings, Inc. [Member]

Cash flows from operating activities:

Net loss

(3,637)

(27,577)

Adjustments to reconcile net loss to cash provided by (used in) operating activities:

Depreciation and amortization expense

0

Restructuring Costs

0

Non-cash interest expense, net

0

(Gain) Loss on foreign currency transactions

0

Gains (Losses) on Extinguishment of Debt

0

Stock based compensation

0

Deferred income taxes

0

Tax receivable agreement liability adjustment

0

(Decrease) increase in tax uncertainty, net of valuation allowance

0

Equity Income In Consolidated Subsidiaries

3,637

27,577

Other

0

Changes in operating assets and liabilities:

Accounts receivable, net

0

Inventories

0

Prepaid expenses and other assets

0

Accounts payable

0

Accrued expenses

0

Cash payments on restructuring liabilities

0

Other

0

Net cash used in operating activities

0

Payments to Acquire Productive Assets

0

Proceeds from sale of assets

0

Net cash used in investing activities

0

Cash flows from financing activities:

Net revolver borrowings

0

Payments on long-term debt

0

Payments Related to Tax Withholding for Share-based Compensation

0

Proceeds from Stock Options Exercised

0

Proceeds from intercompany investment

0

Net cash provided by (used in) financing activities

0

Impact of exchange rate movements on cash

0

Net decrease in cash and cash equivalents

0

Cash and cash equivalents at the beginning of the period

0

Cash and cash equivalents at the end of the period

0

Subsidiary Issuer [Member]

Cash flows from operating activities:

Net loss

(3,637)

(27,577)

Adjustments to reconcile net loss to cash provided by (used in) operating activities:

Depreciation and amortization expense

46

61

Restructuring Costs

0

Non-cash interest expense, net

3,477

3,416

(Gain) Loss on foreign currency transactions

0

Stock based compensation

259

337

Deferred income taxes

0

Tax receivable agreement liability adjustment

0

(18,150)

(Decrease) increase in tax uncertainty, net of valuation allowance

0

Equity Income In Consolidated Subsidiaries

6,634

4,169

Other

0

Changes in operating assets and liabilities:

Accounts receivable, net

0

Inventories

0

Prepaid expenses and other assets

(2,243)

(285)

Accounts payable

35

(54)

Accrued expenses

(8,854)

(13,833)

Cash payments on restructuring liabilities

0

Other

0

Net cash used in operating activities

(4,283)

(13,217)

Payments to Acquire Productive Assets

313

362

Proceeds from sale of assets

0

Net cash used in investing activities

(313)

(362)

Cash flows from financing activities:

Net revolver borrowings

30,000

10,000

Payments on long-term debt

(1,075)

(31,075)

Payments Related to Tax Withholding for Share-based Compensation

(1,186)

Proceeds from Stock Options Exercised

103

Proceeds from intercompany investment

(47,625)

(28,351)

Net cash provided by (used in) financing activities

(19,783)

(49,426)

Impact of exchange rate movements on cash

0

Net decrease in cash and cash equivalents

(24,379)

(63,005)

Cash and cash equivalents at the beginning of the period

50,035

94,692

Cash and cash equivalents at the end of the period

25,656

31,687

Guarantor Subsidiaries [Member]

Cash flows from operating activities:

Net loss

(1,850)

2,467

Adjustments to reconcile net loss to cash provided by (used in) operating activities:

Depreciation and amortization expense

11,702

12,379

Restructuring Costs

904

0

Non-cash interest expense, net

0

(Gain) Loss on foreign currency transactions

0

Gains (Losses) on Extinguishment of Debt

0

Stock based compensation

0

Deferred income taxes

59

65

Tax receivable agreement liability adjustment

0

(Decrease) increase in tax uncertainty, net of valuation allowance

(144)

62

Equity Income In Consolidated Subsidiaries

0

Other

(32)

(138)

Changes in operating assets and liabilities:

Accounts receivable, net

4,718

11,718

Inventories

(21,775)

(10,511)

Prepaid expenses and other assets

3,269

(68)

Accounts payable

8,368

(3,995)

Accrued expenses

(35,943)

(25,802)

Cash payments on restructuring liabilities

(23)

(112)

Other

0

139

Net cash used in operating activities

(40,119)

(36,956)

Payments to Acquire Productive Assets

7,580

6,946

Proceeds from sale of assets

29

76

Net cash used in investing activities

(7,551)

(6,870)

Cash flows from financing activities:

Net revolver borrowings

0

Payments on long-term debt

0

Payments Related to Tax Withholding for Share-based Compensation

0

Proceeds from Stock Options Exercised

0

Proceeds from intercompany investment

48,158

41,818

Net cash provided by (used in) financing activities

48,158

41,818

Impact of exchange rate movements on cash

0

Net decrease in cash and cash equivalents

488

(2,008)

Cash and cash equivalents at the beginning of the period

(10,918)

(4,944)

Cash and cash equivalents at the end of the period

(10,430)

(6,952)

Gains (Losses) On Modification Or Extinguishment Of Debt

0

Non-Guarantor Subsidiary [Member]

Cash flows from operating activities:

Net loss

(4,784)

(6,636)

Adjustments to reconcile net loss to cash provided by (used in) operating activities:

Depreciation and amortization expense

1,705

1,590

Restructuring Costs

0

566

Non-cash interest expense, net

0

(Gain) Loss on foreign currency transactions

155

584

Gains (Losses) on Extinguishment of Debt

0

Stock based compensation

0

Deferred income taxes

(2,226)

0

Tax receivable agreement liability adjustment

0

(Decrease) increase in tax uncertainty, net of valuation allowance

0

Equity Income In Consolidated Subsidiaries

0

Other

0

Changes in operating assets and liabilities:

Accounts receivable, net

1,126

(2,584)

Inventories

(1,643)

(467)

Prepaid expenses and other assets

92

98

Accounts payable

1,011

3,174

Accrued expenses

809

1,860

Cash payments on restructuring liabilities

0

(556)

Other

82

2

Net cash used in operating activities

(6,235)

1,627

Payments to Acquire Productive Assets

525

424

Proceeds from sale of assets

43

0

Net cash used in investing activities

(482)

(424)

Cash flows from financing activities:

Net revolver borrowings

0

Payments on long-term debt

0

Payments Related to Tax Withholding for Share-based Compensation

0

Proceeds from Stock Options Exercised

0

Proceeds from intercompany investment

(533)

(13,467)

Net cash provided by (used in) financing activities

(533)

(13,467)

Impact of exchange rate movements on cash

205

2,193

Net decrease in cash and cash equivalents

(7,045)

(10,071)

Cash and cash equivalents at the beginning of the period

12,480

19,677

Cash and cash equivalents at the end of the period

5,435

9,606

Gains (Losses) On Modification Or Extinguishment Of Debt

0

Guarantor Ply Gem Holdings, Inc. [Member]

Cash flows from financing activities:

Gains (Losses) On Modification Or Extinguishment Of Debt

0

Issuer Ply Gem Industries, Inc. [Member]

Adjustments to reconcile net loss to cash provided by (used in) operating activities:

Gains (Losses) on Extinguishment of Debt

2,399

Cash flows from financing activities:

Gains (Losses) On Modification Or Extinguishment Of Debt

(2,399)

Consolidating Adjustments [Member]

Cash flows from operating activities:

Net loss

10,271

31,746

Adjustments to reconcile net loss to cash provided by (used in) operating activities:

Depreciation and amortization expense

0

Restructuring Costs

0

Non-cash interest expense, net

0

(Gain) Loss on foreign currency transactions

0

Gains (Losses) on Extinguishment of Debt

0

Stock based compensation

0

Deferred income taxes

0

Tax receivable agreement liability adjustment

0

(Decrease) increase in tax uncertainty, net of valuation allowance

0

Equity Income In Consolidated Subsidiaries

(10,271)

(31,746)

Other

0

Changes in operating assets and liabilities:

Accounts receivable, net

0

Inventories

0

Prepaid expenses and other assets

0

Accounts payable

0

Accrued expenses

0

Cash payments on restructuring liabilities

0

Other

0

Net cash used in operating activities

0

Payments to Acquire Productive Assets

0

Proceeds from sale of assets

0

Net cash used in investing activities

0

Cash flows from financing activities:

Net revolver borrowings

0

Payments on long-term debt

0

Payments Related to Tax Withholding for Share-based Compensation

0

Proceeds from Stock Options Exercised

0

Proceeds from intercompany investment

0

Net cash provided by (used in) financing activities

0

Impact of exchange rate movements on cash

0

Net decrease in cash and cash equivalents

0

Cash and cash equivalents at the beginning of the period

0

Cash and cash equivalents at the end of the period

0

Gains (Losses) On Modification Or Extinguishment Of Debt

$ 0