AS
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 24,
2009
Registration
No. 333-
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
______________________________________________________________
FORM
S-1
REGISTRATION
STATEMENT
UNDER
THE
SECURITIES ACT OF 1933
______________________________________________________________
PGT,
Inc.
(Exact
Name of Registrant as Specified in Its Charter)
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Delaware
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3442
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20-0634715
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(State
or other jurisdiction of
incorporation
or organization)
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(Primary
Standard Industrial
Classification
Code Number)
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(I.R.S. Employer
Identification
Number)
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1070
Technology Drive
North
Venice, Florida 34275
(941)
480-1600
(Address,
including zip code, and telephone number, including area code, of registrant’s
principal executive offices)
Mario
Ferrucci III
Vice
President, General Counsel and Secretary
PGT,
Inc.
1070
Technology Drive
North
Venice, Florida 34275
(941)
480-1600
(Name,
address, including zip code, and telephone number, including area code, of agent
for service)
Copy
to:
Robert
B. Pincus, Esq.
Skadden,
Arps, Slate, Meagher & Flom LLP
One
Rodney Square, 7th
Floor
Wilmington,
Delaware 19801
(302)
651-3000
Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective.
If
any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. þ
If
this Form is filed to register additional securities for an offering pursuant to
Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. o
If
this Form is a post-effective amendment pursuant to Rule 462(c) under the
Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same
offering. o
If
this Form is a post-effective amendment pursuant to Rule 462(d) under the
Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same
offering. o
Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company”
in Rule 12b-2 of the Exchange Act.
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Large
accelerated filer □
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Accelerated filer R
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Non-accelerated
filer □
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Smaller
reporting company □
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(Do
not check if a smaller reporting company)
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CALCULATION
OF REGISTRATION FEE
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Title
Of Each Class Of Securities
To
Be Registered
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Amount
To Be
Registered
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Proposed
Maximum
Offering
Price Per Unit
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Proposed
Maximum
Aggregate
Offering Price
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Amount
Of
Registration
Fee
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Common
Stock, par value $0.01 per share
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[●]
shares
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$[●]
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$15,000,000
(1)
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$1,069.50
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Rights
to purchase Common Stock, par value $0.01 per share
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(2)
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N/A
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N/A
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$0.00(3)
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Total
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-----
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-----
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(1)
Represents the aggregate gross proceeds from the exercise of the maximum number
of rights that may be issued.
(2)
Evidencing the rights to subscribe for [●] shares of common stock, par value
$0.01 per share.
(3)
The rights are being issued for no consideration. Pursuant to Rule
457(g) under the Securities Act of 1933, as amended,
no separate registration fee is
payable.
THE
REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS
MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A
FURTHER AMENDMENT THAT SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
THE
INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THESE
SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY THESE SECURITIES BE ACCEPTED
PRIOR TO THE TIME THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION BECOMES EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL
THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN
ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
SUBJECT
TO COMPLETION—DATED DECEMBER 24, 2009
PROSPECTUS
PGT,
Inc.
Rights
to Purchase up to [●] Shares of Common Stock at $[●] per Share
We
are distributing at no charge to holders of our common stock non-transferable
subscription rights to purchase shares of our common stock. You will receive one
subscription right for every [●] shares of common stock owned at the close of
business on [●], 2010, subject to adjustments to eliminate fractional
rights. We are distributing subscription rights exercisable for up to
an aggregate of [●] shares of our common stock. The proceeds from the
rights offering, less expenses incurred in connection with the rights offering
and our recent amendment of our Credit Agreement, will be used to repay a
portion of our outstanding indebtedness under our Credit
Agreement. We expect the total purchase price of the shares offered
in this rights offering to be $[●], assuming full participation.
Each
whole subscription right will entitle you, as a holder of our common stock, to
purchase one share of our common stock at a subscription price of $[●] per
share, which is [●]% of the closing price of our common stock on [●], 2010, the
day before our board of directors set the subscription price, and [●]% of the
closing price of our common stock on the record date of [●],
2010. Subscribers who exercise their rights in full may
over-subscribe for additional shares, subject to certain limitations, to the
extent shares are available. The subscription rights will expire if
they are not exercised by 5:00 p.m., Eastern Time, on [●], 2010, unless
extended. JLL Partners Fund IV, L.P. (“JLL Fund IV”), which owned
approximately [●]% of our outstanding shares of common stock as of the record
date, has indicated to us that it intends to exercise its rights under the basic
subscription privilege in full.
You
should carefully consider whether to exercise your subscription rights before
the expiration of the rights offering. All exercises of subscription
rights are irrevocable. Our board of directors is making no
recommendation regarding your exercise of the subscription
rights. The subscription rights may not be sold or
transferred.
The
shares are being offered directly by us without the services of an underwriter
or selling agent.
Shares
of our common stock are traded on the Nasdaq Global Market under the symbol
“PGTI.” On [●], 2010, the closing sales price for our common stock
was $[●] per share. The shares of common stock issued in the rights
offering will also be listed on the Nasdaq Global Market under the same
symbol.
Exercising the rights and investing
in our common stock involves a high degree of risk. We urge you to carefully
read the section entitled “ Risk Factors” beginning on page [●] of this prospectus, the section
entitled “Risk Factors” in our Annual Report on Form 10-K for the year ended
January 3, 2009, and all other information included or incorporated herein by
reference in this prospectus in its entirety before you decide whether to
exercise your subscription rights.
OFFERING
SUMMARY
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Per
Share
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Aggregate
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Subscription
Price
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$[●]
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$
[●]
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Estimated
Expenses
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$
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$
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Net
Proceeds to Us
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$
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$
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Neither
the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or determined if this prospectus is
truthful or complete. Any representation to the contrary is a criminal
offense.
The
date of this prospectus
is ,
2010.
TABLE
OF CONTENTS
Page
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Questions
and Answers Relating to the Rights Offering
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[●]
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Summary
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[●]
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Risk
Factors
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[●]
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Cautionary
Note Regarding Forward-Looking Statements
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[●]
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Use
of Proceeds
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[●]
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Capitalization
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[●]
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The
Rights Offering
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[●]
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Price
Range of Common Stock and Dividend Policy
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[●]
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Description
of Common Stock
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[●]
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Material
U.S. Federal Income Tax Consequences
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[●]
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Plan
of Distribution
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[●]
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Legal
Matters
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[●]
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Experts
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[●]
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Where
You Can Find More Information
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[●]
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Incorporation
by Reference
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[●]
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ABOUT
THIS PROSPECTUS
Unless
otherwise stated or the context otherwise requires, the terms “PGT,” “we,” “us,”
“our,” and the “Company” refer to PGT, Inc. and its subsidiary.
You
should rely only on the information contained or incorporated by reference in
this prospectus. We have not authorized anyone to provide you with
additional or different information. If anyone provides you with
additional, different, or inconsistent information, you should not rely on
it. We are not making an offer to sell securities in any jurisdiction
in which the offer or sale is not permitted. You should assume that
the information in this prospectus is accurate only as of the date on the front
cover of this prospectus, and any information we have incorporated by reference
is accurate only as of the date of the document incorporated by reference, in
each case, regardless of the time of delivery of this prospectus or any exercise
of the rights. Our business, financial condition, results of
operations, and prospects may have changed since those dates.
QUESTIONS
AND ANSWERS RELATING TO THE RIGHTS OFFERING
The
following are examples of what we anticipate will be common questions about the
rights offering. The answers are based on selected information from
this prospectus and the documents incorporated by reference
herein. The following questions and answers do not contain all of the
information that may be important to you and may not address all of the
questions that you may have about the rights offering. This
prospectus and the documents incorporated by reference herein contain more
detailed descriptions of the terms and conditions of the rights offering and
provide additional information about us and our business, including potential
risks related to the rights offering, the common stock of the Company, and our
business.
Exercising
the rights and investing in our common stock involves risks. We urge
you to carefully read the section entitled “Risk Factors” beginning on page [●]
of this prospectus and the section entitled “Risk Factors” in our Annual Report
on Form 10-K for the year ended January 3, 2009, and all other information
included or incorporated herein by reference in this prospectus in its entirety
before you decide whether to exercise your rights.
What
is a rights offering?
A
rights offering is a distribution of subscription rights on a pro rata basis to all
stockholders of a company. We are distributing to holders of our
common stock as of the close of business on [●], 2010, the “record date,” at no
charge, non-transferable subscription rights to purchase shares of our common
stock. You will receive one subscription right for every [●] shares
of common stock you owned at the close of business on the record date, subject
to adjustments to eliminate fractional rights. The subscription
rights will be evidenced by rights certificates.
What
is a right?
Each
whole right gives our stockholders the opportunity to purchase one share of our
common stock for $[●] per share and carries with it a basic subscription
privilege and an over-subscription privilege.
How
many shares may I purchase if I exercise my rights?
We
are granting to you, as a stockholder of record on the record date, one
subscription right for every [●] shares of our common stock you owned at that
time. Each right contains the basic subscription privilege and the
over-subscription privilege. We determined the ratio of shares to
rights by dividing $[●] by the subscription price of $[●] to determine the
number of shares to be issued in the rights offering and then dividing the
number of shares outstanding on the record date by that number. For
example, if you owned 1,000 shares of our common stock on the record date and
you were granted one right for every [●] shares of our common stock you owned at
that time, then you have the right to purchase [●] shares of common stock for
$[●] per share, subject to adjustment. You may exercise any number of
your subscription rights, or you may choose not to exercise any subscription
rights.
If
you hold your shares in the name of a broker, dealer, or other nominee who uses
the services of the Depository Trust Company, or “DTC,” then DTC will issue one
right to your nominee for every [●] shares of our common stock you own at the
record date, subject to adjustments to eliminate fractional
rights. Each whole right can then be used to purchase one share of
common stock for $[●] per share. As in the example above, if you
owned 1,000 shares of our common stock on the record date, you have the right to
purchase [●]shares of common stock for $[●] per share.
We
will not issue fractional subscription rights or cash in lieu of fractional
rights. Fractional subscription rights will be rounded to the nearest
whole number, with such adjustments as may be necessary to ensure that we offer
[●] shares of common stock in the rights offering. In the unlikely
event that, because of the rounding of fractional subscription rights, the
rights offering would have been subscribed in an amount in excess of [●] shares
of common stock, all holders’ subscription rights will be reduced in an
equitable manner. Any excess subscription funds will be returned,
without interest or deduction.
What
is the basic subscription privilege?
The
basic subscription privilege of each whole right entitles you to purchase one
share of our common stock at the subscription price of $[●] per
share.
What
is the over-subscription privilege?
The
over-subscription privilege of each right entitles you, if you have fully
exercised your basic subscription privilege, to subscribe for additional shares
of our common stock (up to the number of shares for which you subscribed under
your basic subscription privilege) at the same subscription price per share on a
pro rata basis if any
shares are not purchased by other holders of subscription rights under their
basic subscription privileges as of the expiration date. “Pro rata”
means in proportion to the number of shares of our common stock that all
subscription rights holders who have fully exercised their basic subscription
privileges on their common stock holdings have requested to purchase pursuant to
the over-subscription privilege.
What
if there is an insufficient number of shares to satisfy the over-subscription
requests?
If
there is an insufficient number of shares of our common stock available to fully
satisfy the over-subscription requests of rights holders, subscription rights
holders who exercised their over-subscription privilege will receive the
available shares pro
rata based on the number of shares each subscription rights holder has
subscribed for under the over-subscription privilege. Any excess
subscription payments will be returned, without interest or deduction, promptly
after the expiration of the rights offering.
Why
are we conducting the rights offering?
We
are conducting the rights offering to raise funds to pay down outstanding
indebtedness under our Credit Agreement. The effectiveness of
Amendment No. 3, dated as of December 22, 2009, to our Second Amended and
Restated Credit Agreement, dated as of February 14, 2006 (as amended and as may
be further amended, supplemented or otherwise modified from time to time, the
“Credit Agreement”) is conditioned on our repayment of $17 million of
outstanding indebtedness thereunder, with at least $15 million of such
prepayment to be made with the proceeds of this rights offering or the sale of
certain equity securities of the Company. For more information on the
amendment to our Credit Agreement, see the section of this prospectus entitled
“Summary—Recent Developments.” A rights offering provides our
stockholders the opportunity to participate in this transaction on a pro rata basis and minimizes
the dilution of their ownership interest in the Company.
How
was the subscription price of $[●] per share determined?
Our
board of directors determined the subscription price after considering, among
other things, the likely cost of capital from other sources and the price at
which our stockholders might be willing to participate in the rights
offering. The subscription price for a subscription right is $[●] per
share, which is [●]% of the closing price of our common stock on [●], 2010, the
day before our board of directors set the subscription price, and [●]% of the
closing price of our common stock on the record date of [●],
2010. The subscription price is not intended to bear any relationship
to the book value of our assets or our past operations, cash flows, losses,
financial condition, net worth or any other established criteria used to value
securities. You should not consider the subscription price to be an
indication of the fair value of the common stock to be offered in the rights
offering.
Am
I required to exercise all of the rights I receive in the rights
offering?
No. You
may exercise any number of your rights, or you may choose not to exercise any
rights. If you do not exercise any rights, the number of shares of our common
stock you own will not change. However, because shares are expected
to be purchased by other stockholders in the rights offering, your percentage
ownership after the exercise of the rights will be diluted.
How
soon must I act to exercise my rights?
The
rights may be exercised beginning on the date of this prospectus through the
expiration date, which is [●], 2010, at 5:00 p.m., Eastern Time, unless extended
by us. If you elect to exercise any rights, the subscription agent
must actually receive all required documents and payments from you or your
broker or nominee at or before 5:00 p.m., Eastern Time, on the expiration
date. Although we have the option of extending the expiration date of
the subscription period, we currently do not intend to do so.
When
will I receive my subscription rights certificate?
Promptly
after the date of this prospectus, the subscription agent will send a
subscription rights certificate to each registered holder of our common stock as
of the close of business on the record date, based on our stockholder registry
maintained at the transfer agent for our common stock. If you hold
your shares of common stock through a brokerage account, bank, or other nominee,
you will not receive an actual subscription rights
certificate. Instead, as described in this prospectus, you must
instruct your broker, bank or nominee whether or not to exercise rights on your
behalf. If you wish to obtain a separate subscription rights
certificate, you should promptly contact your broker, bank or other nominee and
request a separate subscription rights certificate. It is not necessary to have
a physical subscription rights certificate to elect to exercise your rights if
your shares are held by a broker, bank, or other nominee.
May
I transfer my rights?
No. Should
you choose not to exercise your subscription rights, you may not sell, give
away, or otherwise transfer your subscription rights. Subscription
rights will, however, be transferable by operation of law (for example, upon the
death of the recipient). Upon expiration of the rights offering, all
unexercised rights will automatically expire.
Are
we requiring a minimum subscription to complete the rights
offering?
No;
however, JLL Fund IV, which owned approximately [●]% of our outstanding shares
of common stock as of the record date, has indicated to us that it intends to
exercise its rights under the basic subscription privilege in full.
Can
the board of directors cancel, terminate, amend, or extend the rights
offering?
We
may not cancel or terminate the rights offering, nor may we amend the terms of
the rights offering. We may, however, extend the subscription period
of the rights offering. The period for exercising your subscription
rights may be extended by our board of directors, although we do not presently
intend to do so.
Has
our board of directors made a recommendation to our stockholders regarding the
exercise of rights under the rights offering?
No. Our
board of directors has not, and will not, make any recommendation to
stockholders regarding the exercise of rights under the rights
offering. You should make an independent investment decision about
whether or not to exercise your rights. Stockholders who exercise
rights risk investment loss on new money invested. We cannot assure
you that the market price for our common stock will remain above the
subscription price or that anyone purchasing shares at the subscription price
will be able to sell those shares in the future at the same price or a higher
price. If you do not exercise your rights, you will lose any value
represented by your rights and your percentage ownership interest in the Company
will be diluted. For more information on the risks of participating
in the rights offering, see the section of this prospectus entitled “Risk
Factors.”
Five
of our directors may be deemed to be affiliated with JLL Partners, Inc., which
is in turn affiliated with JLL Fund IV, which owned approximately [●]% of our
outstanding shares of common stock as of the record date and which has indicated
to us that it intends to exercise its rights under the basic subscription
privilege in full. You should not view these intentions of JLL Fund
IV as a recommendation or other indication, by it or any member of our board of
directors, that the exercise of the subscription rights is in your best
interests.
How
do I exercise my rights? What forms and payment are required to purchase the
shares of common stock?
If
you wish to participate in the rights offering, you must take the following
steps, unless your shares are held by a broker, dealer, or other
nominee:
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·
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deliver
payment to the subscription agent using the methods outlined in this
prospectus; and
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·
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deliver
a properly completed rights certificate to the subscription agent before
5:00 p.m., Eastern Time, on [●], 2010, unless we extend the rights
offering in our sole discretion.
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If
you send a payment that is insufficient to purchase the number of shares you
requested, or if the number of shares you requested is not specified in the
forms, the payment received will be applied to exercise your basic subscription
privilege. Unless you have specified the number of shares you wish to
purchase upon exercise of your over-subscription privilege, any payment in
excess of that required to exercise your basic subscription privilege will be
refunded. If the payment exceeds the subscription price for the full
exercise of the basic and over-subscription privileges (to the extent specified
by you), the excess will be refunded. You will not receive interest
on any payments refunded to you under the rights offering.
If
I exercise my rights, when will I receive my new shares?
We
will issue the shares for which subscriptions pursuant to the basic subscription
privilege have been properly received before the applicable expiration time
promptly following receipt of a properly completed and executed rights
certificate, together with payment of the subscription price for each share of
common stock subscribed for pursuant to the basic subscription
privilege. We will issue the shares for which subscriptions pursuant
to the over-subscription privilege have been properly received before the
applicable expiration time promptly after expiration of the rights offering and
after all pro rata
allocations and adjustments have been completed.
After
I send in my payment and rights certificate, may I change or cancel my exercise
of rights?
No. All
exercises of subscription rights are irrevocable. You should not
exercise your rights unless you are certain that you wish to purchase additional
shares of our common stock at a price of $[●] per share.
What
should I do if I want to participate in the rights offering, but my shares are
held in the name of my broker, dealer, or other nominee?
If
you hold your shares of our common stock in the name of a broker, dealer, or
other nominee, then your broker, dealer, or other nominee is the record holder
of the shares you own. The record holder must exercise the rights on
your behalf for the shares of common stock you wish to purchase.
If
you wish to participate in the rights offering and purchase shares of common
stock, please promptly contact the record holder of your shares. We
will ask your broker, dealer, or other nominee to notify you of the rights
offering. You should complete and return to your record holder the
form entitled “Beneficial Owner Election Form.” You should receive
this form from your record holder with the other rights offering
materials.
How
much money will the Company receive from the rights offering?
While
the rights offering has no minimum purchase requirement, if we sell all of the
shares being offered, we will receive proceeds of $[●], before deducting
estimated offering expenses. See the section of this prospectus
entitled “Use of Proceeds.”
Have
any stockholders indicated that they will exercise their rights?
Yes. JLL
Fund IV has indicated to the Company that it intends to exercise its rights
under the basic subscription privilege in full. If JLL Fund IV does
exercise its subscription rights under the basic subscription privilege in full,
it
will
receive [●] shares of common stock. In addition, JLL Fund IV may
subscribe for additional shares of common stock under the over-subscription
privilege.
Are
there risks in exercising my subscription rights?
Yes. The
exercise of your subscription rights involves risks. Exercising your
subscription rights means buying additional shares of our common stock and
should be considered as carefully as you would consider any other equity
investment. You should carefully read the section entitled “Risk
Factors” beginning on page [●] of this prospectus and the section entitled “Risk
Factors” in our Annual Report on Form 10-K for the year ended January 3, 2009,
and all other information included or incorporated herein by reference in this
prospectus in its entirety before you decide whether to exercise your
rights.
How
many shares of common stock will be outstanding after the rights
offering?
As
of [●], 2010, we had [●] shares of common stock issued and
outstanding. Based upon the maximum of [●] shares that may be issued
pursuant to the rights offering, we would have [●] shares of common stock
outstanding after the closing of the rights offering, excluding any shares that
may be issued pursuant to the exercise of stock options.
Will
the rights be listed on a stock exchange or national market?
The
rights themselves will not be listed on the Nasdaq Global Market or any other
stock exchange or national market or on the OTC Bulletin Board. Our
common stock will continue to trade on the Nasdaq Global Market under the symbol
“PGTI,” and the shares issued in connection with the rights offering will be
eligible for trading on the Nasdaq Global Market.
How
do I exercise my rights if I live outside the United States?
The
subscription agent will hold rights certificates for stockholders having
addresses outside the United States. In order to exercise rights,
holders with addresses outside the United States must notify the subscription
agent and timely follow other procedures described in the section of this
prospectus entitled “The Rights Offering — Foreign Stockholders.”
What
fees or charges apply if I purchase shares of common stock?
We
are not charging any fee or sales commission to issue rights to you or to issue
shares to you if you exercise your rights. If you exercise your
rights through the record holder of your shares, you are responsible for paying
any fees your record holder may charge you.
What
are the U.S. federal income tax consequences of exercising rights?
A
holder will not recognize income, gain, or loss for United States federal income
tax purposes in connection with the receipt or exercise of subscription rights
in the rights offering. You should consult your tax advisor as to the
particular consequences to you of the rights offering. For a detailed
discussion, see the section of this prospectus entitled “Material United States
Federal Income Tax Consequences.”
To
whom should I send my forms and payment?
If
your shares are held in the name of a broker, dealer, or other nominee, then you
should send your subscription documents, rights certificate, and payment to that
record holder in accordance with the instructions you receive from that record
holder. If you are the record holder, then you should send your
subscription documents, rights certificate, and payment by hand delivery, first
class mail, or courier service to:
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By
Mail:
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By
Overnight Courier or By Hand:
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You
are solely responsible for completing delivery to the subscription agent of your
subscription documents, rights certificate, and payment. We urge you
to allow sufficient time for delivery of your subscription materials to the
subscription agent.
Whom
should I contact if I have other questions?
If
you have other questions or need assistance, please contact the information
agent, [●] at [●].
For
a more complete description of the rights offering, see “The Rights Offering”
beginning on page [●].
SUMMARY
This
summary highlights information contained elsewhere in this prospectus or
incorporated by reference therein. This summary may not contain all
of the information that you should consider before deciding whether or not you
should exercise your rights. You should read the entire prospectus
carefully, including the section entitled “Risk Factors” beginning on page [●]
of this prospectus and the section entitled “Risk Factors” in our Annual Report
on Form 10-K for the year ended January 3, 2009, and all other information
included or incorporated herein by reference in this prospectus in its entirety
before you decide whether to exercise your rights.
PGT,
Inc.
PGT,
Inc. is the leading U.S. manufacturer and supplier of residential
impact-resistant windows and doors and pioneered the U.S. impact-resistant
window and door industry in the aftermath of Hurricane Andrew in 1992. Our
impact-resistant products, most of which are marketed under the WinGuard® brand
name, combine heavy-duty aluminum or vinyl frames with laminated glass to
provide protection from hurricane-force winds and wind-borne debris by
maintaining their structural integrity and preventing penetration by impacting
objects. Impact-resistant windows and doors satisfy increasingly stringent
building codes in hurricane-prone coastal states and provide an attractive
alternative to shutters and other “active” forms of hurricane protection that
require installation and removal before and after each storm. Our current market
share in Florida, which is the largest U.S. impact-resistant window and door
market, is significantly greater than that of any of our competitors. WinGuard
sales have increased to represent approximately 69% of our net sales in 2008,
compared to approximately 17% in 1999. In addition to our core WinGuard branded
product line, we offer a complete range of premium, made-to-order and fully
customizable aluminum and vinyl windows and doors that represented approximately
31% of our 2008 net sales. We manufacture these products in a wide variety of
styles and sell to both the residential new construction, and home repair and
remodeling end markets including multi-story buildings with our Architectural
Systems line of products. For the year ended January 3, 2009, and the nine
months ended October 3, 2009, we generated net sales of approximately $218.6
million and approximately $130.0 million, respectively.
We
are incorporated under the laws of the State of Delaware. Our
principal executive offices are located at 1070 Technology Drive, North Venice,
Florida 34275, and our telephone number is (941) 480-1600. Our
website is www.pgtindustries.com. The information on our website does not
constitute part of this prospectus and should not be relied upon in connection
with making any investment in our securities.
Recent
Developments
Amendment to Credit
Agreement. On December 22, 2009, we and our wholly-owned
subsidiary, PGT Industries, Inc. (“PGT Industries”), entered into Amendment No.
3 and Waiver to our Second Amended and Restated Credit Agreement (as amended and
as may be further amended, supplemented or otherwise modified from time to time,
the “Credit Agreement”), dated as of February 14, 2006, by and among the
Company, PGT Industries, the lenders party thereto, certain other financial
institutions, and UBS AG, Stamford Branch, as issuing bank, administrative agent
(the “Agent”), and collateral agent.
The
amendment to the Credit Agreement provides, among other things, that, (a) from
the Waiver Effective Date (as defined below) to, but not including, the earlier
of the Amendment Effective Date (as defined below) and March 31, 2010, the
lenders under the Credit Agreement will waive any default as a result of PGT
Industries’ defaulting in the performance of its obligation to maintain the
total leverage ratio and consolidated interest coverage ratio set forth in the
Credit Agreement as of the last day of the fiscal quarter ending on or nearest
to December 31, 2009, and (b) from and after the Waiver Effective Date, the
lenders under the Credit Agreement will waive any default arising under the
Credit Agreement as a result of the issuance by the independent public
accountants for PGT Industries on or prior to March 31, 2010, of an opinion
qualified as to scope or containing other qualification or a going concern
modification that results solely from the default (or potential default) by PGT
Industries in the performance of its obligations to maintain the total leverage
ratio and consolidated interest coverage ratio set forth in the Credit Agreement
(as in effect immediately prior to the effectiveness of the amendment and waiver
to the Credit Agreement). The waiver became effective on December 22,
2009, the date on which specified conditions precedent were satisfied or waived
by the Agent (the “Waiver Effective Date”).
The
amendment to the Credit Agreement also provides that the following amendments
will become effective on the date that specified conditions precedent are
satisfied or waived by the Administrative Agent (the “Amendment Effective
Date”), including a prepayment by PGT Industries of borrowings under the Credit
Agreement of at least $17 million (minus fees and expenses (a) incurred in
connection with the rights offering or the sale of certain equity securities of
the Company and (b) paid pursuant to the amendment), with at least $15 million
of such prepayment to be made with the proceeds of the rights offering or the
sale of certain equity securities of the Company, by March 31,
2010.
Extension. The
amendment to the Credit Agreement extends the maturity date of the commitments
to make revolving loans under the Credit Agreement (the “Commitments”) of those
revolving lenders (and their assignees) who consent to such extension (each, an
“Extending Revolving Lender”) from February 14, 2011 (the “Initial Maturity
Date”) to December 31, 2011 (the “Final Maturity Date”) (the
“Extension”).
The
Commitments of the revolving lenders who do not consent to the Extension (each,
a “Non-Extending Revolving Lender”) will automatically terminate on, and the
unpaid principal amount of the outstanding revolving loans, if any, of
Non-Extending Revolving Lenders will be paid on, the Initial Maturity
Date. The Commitments of the Extending Revolving Lenders will
automatically terminate on, and the unpaid principal amount of the outstanding
revolving loans, if any, of the Extending Revolving Lenders will be paid on, the
Final Maturity Date.
Immediately
following the Initial Maturity Date, so long as there is no default or event of
default under the Credit Agreement, (i) the swingline loan exposure and (ii) the
letter of credit exposure, in each case, of the Non-Extending Revolving Lenders,
will be reallocated pro
rata among the Extending Revolving Lenders in accordance with their
Commitments.
The
amendment to the Credit Agreement permits any Non-Extending Revolving Lender to
consent to the Extension prior to the Initial Maturity Date.
Revolving Commitment
Reduction. The Extending Revolving Lenders have the option to
accept a reduction by PGT Industries of Commitments of such lenders by up to $5
million in the aggregate (the “Revolving Commitment Reduction”), to be applied
among the Extending Revolving Lenders that also accept the Revolving Commitment
Reduction (the “Commitment Reducing Lenders”), reducing each such lender’s
Commitment in an amount equal to $5 million multiplied by a fraction, the
numerator of which is such Commitment Reducing Lender’s revolving commitment
(including, for the avoidance of doubt, and without duplication, all outstanding
revolving loans made by such lender) and the denominator of which is the
aggregate revolving commitments of all Commitment Reducing Lenders, in each case
as set forth in a schedule to the amendment to the Credit
Agreement.
Maximum Total Leverage Ratio
Covenant. The maintenance by PGT Industries of a specified
total leverage ratio will not apply for the test period of October 1, 2009,
through December 31, 2010. Thereafter, for the consecutive test
periods beginning on January 1, 2011, and thereafter, the maximum total leverage
ratio permitted to be maintained will be higher than previously
permitted.
Minimum Interest Coverage
Ratio Covenant. For the consecutive test periods beginning on
October 1, 2009, and thereafter, the minimum consolidated interest coverage
ratio permitted to be maintained will be lower than previously
permitted.
Minimum EBITDA
Covenant. For the consecutive test periods beginning on
October 1, 2009, through December 31, 2010, PGT Industries is required to
maintain a minimum consolidated EBITDA. Thereafter, the maintenance
of a minimum consolidated EBITDA does not apply.
2
Interest on
Loans. The loans under the Credit Agreement comprising each
alternate base rate borrowing and eurodollar borrowing are modified such that
additional interest will be added to the rate in effect immediately prior to the
effectiveness of the amendment solely during any fiscal quarter immediately
following a test period in which the ratio of (x) consolidated indebtedness
minus cash and cash equivalents (in each case as of the last day of the relevant
test period and, in the case of a test period that includes the fourth quarter
of 2009, after giving pro forma effect to the application of any prepayments in
connection with the amendment to the Credit Agreement to (y) consolidated EBITDA
for such test period exceeds 4.25:1.0. Such additional interest shall
be 2.5% per annum which shall be capitalized and added to the unpaid principal
amount of the loans on the last day of each applicable fiscal quarter of PGT
Industries pursuant to the provision described above (“Additional
Interest”). Additional Interest shall not be taken into account for
purposes of calculating the financial covenants set forth in the Credit
Agreement or any of the associated definitions when used therein or for purposes
of any other references or uses of such financial definitions or the associated
definitions in the Credit Agreement.
Alternate Base
Rate. A minimum alternate base rate of 4.25% has been
established.
Applicable
Margin. The applicable margin in effect from time to time used
to determine the interest rate on eurodollar and alternate base rate revolving
loans is increased by 25 basis points for the three levels of total leverage
ratio ranging from greater than 3.5:1 to greater than 4.5:1.
Excess Cash
Flow. The excess cash flow percentage applicable to the
secured leverage ratio as of the applicable test date (used to calculate
prepayments in accordance with the Credit Agreement which are made in an
aggregate principal amount equal to the excess cash flow percentage of excess
cash flow for the appropriate period) has been modified such that the percentage
applicable to a secured leverage ratio of equal to or less than 3:5:1 is 75% and
that applicable to a secured leverage ratio of greater than 3.5:1 is
90%. The amendment clarifies that proceeds from the rights offering
or the sale of certain equity securities of the Company will not be included in
the calculation of excess cash flow.
The
proceeds from this rights offering, less expenses incurred in connection with
the rights offering and the amendment of our Credit Agreement, will be used to
repay a portion of our outstanding indebtedness under our Credit Agreement and
thereby result in the effectiveness of the amendment described
above.
The
Agent, other Credit Agreement agents, certain of the other lenders under the
Credit Agreement, and certain of their respective affiliates have performed or
may in the future perform various commercial banking, lending, investment
banking, financial advisory, trustee, hedging, or other services for us and
certain of our affiliates, for which they have received or will receive fees and
reimbursement of expenses.
3
PGT,
INC. AND SUBSIDIARY
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited
– in thousands, except per share amounts)
|
Nine Months
Ended
|
||||||||
|
October 3,
2009
|
September 27,
2008
|
|||||||
|
Net
sales
|
$ | 129,997 | $ | 169,226 | ||||
|
Cost
of sales
|
94,618 | 115,506 | ||||||
|
Gross
margin
|
35,379 | 53,760 | ||||||
|
Goodwill
and intangible impairment charges
|
- | 93,600 | ||||||
|
Selling,
general and administrative expenses
|
40,194 | 46,909 | ||||||
|
(Loss)
income from operations
|
(4,815 | ) | (86,749 | ) | ||||
|
Interest
expense
|
5,050 | 7,153 | ||||||
|
Other
expense (income), net
|
33 | (38 | ) | |||||
|
Loss
before income taxes
|
(9,898 | ) | (93,864 | ) | ||||
|
Income
tax benefit
|
(181 | ) | (13,799 | ) | ||||
|
Net
loss
|
$ | (9,717 | ) | $ | (80,065 | ) | ||
|
Basic
net loss per common share
|
$ | (0.28 | ) | $ | (2.74 | ) | ||
|
Diluted
net loss per common share
|
$ | (0.28 | ) | $ | (2.74 | ) | ||
|
Weighted
average common shares outstanding:
|
||||||||
|
Basic
|
35,247 | 29,183 | ||||||
|
Diluted
|
35,247 | 29,183 | ||||||
4
PGT,
INC. AND SUBSIDIARY
CONDENSED
CONSOLIDATED BALANCE SHEETS
(in
thousands)
|
October
3,
2009
|
January
3,
2009
|
|||||||
|
ASSETS
|
(unaudited)
|
|||||||
|
Current
assets:
|
||||||||
|
Cash
and cash equivalents
|
$ | 3,094 | $ | 19,628 | ||||
|
Accounts
receivable, net
|
17,044 | 17,321 | ||||||
|
Inventories
|
11,236 | 9,441 | ||||||
|
Deferred
income taxes
|
360 | 1,158 | ||||||
|
Other
current assets
|
4,213 | 5,569 | ||||||
|
Total
current assets
|
35,947 | 53,117 | ||||||
|
Property,
plant and equipment, net
|
67,944 | 73,505 | ||||||
|
Other
intangible assets, net
|
69,019 | 72,678 | ||||||
|
Other
assets, net
|
1,430 | 1,317 | ||||||
|
Total
assets
|
$ | 174,340 | $ | 200,617 | ||||
|
LIABILITIES
AND SHAREHOLDERS’ EQUITY
|
||||||||
|
Current
liabilities:
|
||||||||
|
Accounts
payable and accrued expenses
|
$ | 15,441 | $ | 14,582 | ||||
|
Current
portion of long-term debt and capital lease obligations
|
103 | 330 | ||||||
|
Total
current liabilities
|
15,544 | 14,912 | ||||||
|
Long-term
debt and capital lease obligations
|
70,190 | 90,036 | ||||||
|
Deferred
income taxes
|
17,675 | 18,473 | ||||||
|
Other
liabilities
|
2,658 | 3,011 | ||||||
|
Total
liabilities
|
106,067 | 126,432 | ||||||
|
Total
shareholders’ equity
|
68,273 | 74,185 | ||||||
|
Total
liabilities and shareholders’ equity
|
$ | 174,340 | $ | 200,617 | ||||
5
PGT,
INC. AND SUBSIDIARY
RECONCILIATION
OF NON-GAAP FINANCIAL MEASURES TO THEIR GAAP EQUIVALENTS
(unaudited
– in thousands, except per share amounts)
|
Nine
Months Ended
|
||||||||
|
October
3, 2009
|
September
27, 2008
|
|||||||
|
Reconciliation
to Adjusted Net (Loss) Income and Adjusted Net (Loss) Income per share
(1):
|
||||||||
|
Net
loss
|
$ | (9,717 | ) | $ | (80,065 | ) | ||
|
Reconciling
items:
|
||||||||
|
Goodwill
and intangible impairment charges (2)
|
- | 93,600 | ||||||
|
Restructuring
charges (3)
|
3,905 | 1,752 | ||||||
|
Tax
effect of reconciling items (4)
|
- | (14,486 | ) | |||||
|
Adjusted
net (loss) income
|
$ | (5,812 | ) | $ | 801 | |||
|
Weighted
average shares outstanding:
|
||||||||
|
Diluted
(5)
|
35,247 | 29,183 | ||||||
|
Incremental
shares for stock awards (6)
|
- | 396 | ||||||
|
Diluted
– adjusted
|
35,247 | 29,579 | ||||||
|
Adjusted
net loss (income) per share – diluted
|
$ | (0.16 | ) | $ | 0.03 | |||
|
Reconciliation
to EBITDA and Adjusted EBITDA:
|
||||||||
|
Net
loss
|
$ | (9,717 | ) | $ | (80,065 | ) | ||
|
Reconciling
items:
|
||||||||
|
Depreciation
and amortization expense
|
12,092 | 12,753 | ||||||
|
Interest
expense
|
5,050 | 7,153 | ||||||
|
Income
tax benefit
|
(181 | ) | (13,799 | ) | ||||
|
EBITDA
|
7,244 | (73,958 | ) | |||||
|
Add-backs:
|
||||||||
|
Goodwill
and intangible impairment charges (2)
|
- | 93,600 | ||||||
|
Restructuring
charges (3)
|
3,905 | 1,752 | ||||||
|
Adjusted
EBITDA
|
$ | 11,149 | $ | 21,394 | ||||
|
Adjusted
EBITDA as percentage of net sales
|
8.6 | % | 12.6 | % | ||||
|
(1)
|
The
Company’s non-GAAP financial measures were explained in its Form 8-K filed
November 4, 2009.
|
|
(2)
|
Represents
the write-down of the carrying value of goodwill and a
trademark. The Company recorded an estimated $92.0 million
non-cash goodwill impairment charge in the second quarter of 2008 based on
the results of preliminary impairment tests at that time. The
Company completed its updated impairment tests in the 2008 third quarter
which resulted in additional non-cash impairment charges totaling $1.6
million, of which $1.3 million related to goodwill and $0.3 million
related to a trademark.
|
|
(3)
|
Represents
charges related to restructuring actions taken in the first and third
quarters of 2009 and the first quarter of 2008. These charges
relate primarily to employee separation costs. Of the $3.9
million restructuring charge in 2009, $1.9 million is included in cost of
goods sold and $2.0 million is included in selling, general and
administrative expenses. Of the $1.8 million restructuring
charge in 2008, $1.1 million was included in cost of goods sold and $0.7
million was included in selling, general and administrative
expenses.
|
|
(4)
|
In
2009, the tax benefit of the reconciling item is offset by an increase in
the valuation allowance for deferred
taxes.
|
|
(5)
|
Due
to the net losses, the effect of equity compensation plans is
anti-dilutive.
|
6
|
(6)
|
Represents
dilutive stock options included in the calculation of adjusted net income
per diluted share for the nine months ended September 27,
2008.
|
7
The
Rights Offering
|
Securities
offered
|
We
are distributing to you, at no charge, one non-transferable subscription
right for every [●] shares of our common stock that you owned on the
record date, either as a holder of record or, in the case of shares held
of record by brokers, banks, or other nominees, on your behalf, as a
beneficial owner of such shares, subject to adjustments to eliminate
fractional rights. We expect the gross proceeds from the rights
offering to be $[●], assuming full participation.
|
|
|
Basic
subscription privilege
|
Each
whole right gives you the opportunity to purchase one share of our common
stock for $[●] per share.
|
|
|
Over-subscription
privilege
|
If
you elect to exercise your basic subscription privilege in full, you may
also subscribe for additional shares (up to the number of shares for which
you subscribed under your basic subscription privilege) at the same
subscription price per share. If an insufficient number of
shares are available to satisfy fully the over-subscription privilege
requests, the available shares will be distributed proportionately among
rights holders who exercised their over-subscription privilege based on
the number of shares each rights holder subscribed for under the
over-subscription privilege. The subscription agent will return
any excess payments by mail without interest or deduction promptly after
the expiration of the rights offering.
|
|
|
Record
date
|
Close
of business on [●], 2010.
|
|
|
Expiration
date
|
5:00
p.m., Eastern Time, on [●], 2010, unless extended by us, in our sole
discretion. Any rights not exercised at or before that time
will expire without any payment to the holders of those unexercised
rights.
|
|
|
Subscription
price
|
$[●]
per share, payable in immediately available funds, which is [●]% of the
closing price of our common stock on [●], 2010, the day before our board
of directors set the subscription price, and [●] % of the closing price of
our common stock on the record date of [●], 2010.
|
|
|
Use
of proceeds
|
Assuming
full participation, the proceeds from the rights offering are expected to
be $[●], before deducting expenses relating to the rights
offering. The proceeds from the rights offering, less expenses
incurred in connection with the rights offering and our recent amendment
of our Credit Agreement, will be used to repay a portion of our
outstanding indebtedness under our Credit Agreement.
|
|
|
Non-transferability
of rights
|
The
subscription rights may not be sold, transferred, or assigned and will not
be listed for trading on the Nasdaq Global Market or on any stock exchange
or market or on the OTC Bulletin Board.
|
|
|
No
board recommendation
|
Our
board of directors makes no recommendation to you about whether you should
exercise any rights. You are
urged
|
8
|
to
make an independent investment decision about whether to exercise your
rights based on your own assessment of our business and the rights
offering. Please see the section of this prospectus entitled
“Risk Factors” for a discussion of some of the risks involved in investing
in our common stock.
|
||
|
No
revocation
|
If
you exercise any of your rights, you will not be permitted to revoke or
change the exercise or request a refund of monies paid.
|
|
|
Material
United States federal income tax considerations
|
A
holder will not recognize income, gain, or loss for United States federal
income tax purposes in connection with the receipt or exercise of
subscription rights in the rights offering. You should consult your tax
advisor as to the particular consequences to you of the rights offering.
For a detailed discussion, see “Material United States Federal Income Tax
Consequences.”
|
|
|
Extension,
cancellation, and amendment
|
The
period for exercising your subscription rights may be extended by our
board of directors, although we do not presently intend to do
so. We may not cancel or terminate the rights offering, nor may
we amend the terms of the rights offering.
|
|
|
Procedure
for exercising rights
|
If
you are the record holder of shares of our common stock, to exercise your
rights you must complete the rights certificate and deliver it to the
subscription agent, [●], together with full payment for all the
subscription rights (pursuant to both the basic subscription privilege and
the over-subscription privilege) you elect to exercise. The
subscription agent must receive the proper forms and payments on or before
5:00 p.m., Eastern Time, on [●], 2010. You may deliver the
documents and payments by mail or commercial courier. If
regular mail is used for this purpose, we recommend using registered mail,
properly insured, with return receipt requested. If you are a
beneficial owner of shares of our common stock, you should instruct your
broker, bank, or nominee in accordance with the procedures described in
the section of this prospectus entitled “The Rights Offering—Beneficial
Owners.”
|
|
|
Subscription
agent
|
[●]
|
|
|
Information
agent
|
[●]
|
|
|
Questions
|
Questions
regarding the rights offering should be directed to [●], at
[●].
|
|
|
Shares
outstanding before the rights offering
|
[●]
shares as of [●], 2010.
|
|
|
Shares
outstanding after completion of the rights offering
|
Up
to [●] shares of our common stock will be outstanding immediately after
completion of the rights offering (excluding shares issued upon conversion
of certain other securities).
|
|
Issuance
of our common stock
|
If
you purchase shares of common stock pursuant to the basic subscription
privilege, we will issue certificates representing those shares to you or
to DTC on your behalf, as the case may be, promptly after receipt of
payment for such shares. If you purchase shares of common stock
pursuant to the over-subscription privilege, we will issue certificates
representing those shares to you or to DTC on your behalf, as the case may
be, promptly after the completion of the rights
offering.
|
|
|
Risk
factors
|
Stockholders
considering making an investment in the rights offering should consider
the risk factors described in the section of this prospectus entitled
“Risk Factors.”
|
|
|
Fees
and expenses
|
We
will bear the fees and expenses relating to the rights
offering.
|
|
|
Nasdaq
Global Market trading symbol
|
Shares
of our common stock are currently listed for quotation on the Nasdaq
Global Market under the symbol “PGTI,” and the shares to be issued in
connection with the rights offering will be eligible for trading on the
Nasdaq Global Market.
|
Risk
Factors
Exercising
your rights and investing in our common stock involves various risks associated
with your investment, including the risks described in the section of this
prospectus entitled “Risk Factors” beginning on page [●] and the risks that we
have highlighted in other sections of this prospectus and in our Annual Report
on Form 10-K for the year ended January 3, 2009, and all other information
included or incorporated by reference in this prospectus. You should
carefully read and consider these risk factors together with all of the other
information included and incorporated by reference in this prospectus before you
decide whether to exercise your rights to purchase shares of our common
stock.
9
RISK
FACTORS
Investing
in our securities involves a high degree of risk. You should carefully consider
the specific risks described below, the risks described in our Annual Report on
Form 10-K for the fiscal year ended January 3, 2009, which are incorporated
herein by reference, and any risks described in our other filings with the SEC,
pursuant to Sections 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act
of 1934, as amended, before making an investment decision. See the section of
this prospectus entitled “Where You Can Find More Information.” Any of the risks
we describe below or in the information incorporated herein by reference could
cause our business, financial condition, or operating results to suffer. The
market price of our common stock could decline if one or more of these risks and
uncertainties develop into actual events. You could lose all or part of your
investment. Some of the statements in this section of the prospectus are
forward-looking statements. For more information about forward-looking
statements, please see the section of this prospectus entitled “Forward-Looking
Statements.”
Risks
Related to Our Business and Industry
We are subject to regional and
national economic conditions.
The
unprecedented decline in the economy in Florida and throughout the United States
could continue to negatively affect demand for our products which has had,
and which could continue to have, an adverse impact on our sales and results of
operations.
A
continuation of the downturn in our markets could adversely impact our credit
agreement.
As
of October 3, 2009, we had $70.3 million of outstanding indebtedness. As noted
elsewhere in this prospectus, we have experienced a significant deterioration in
the various markets in which we compete. A sustained and continued significant
deterioration in these markets may adversely impact our ability to meet certain
covenants under our credit agreement. Management continues to evaluate what, if
any, action or actions may be available or necessary to maintain compliance with
these various covenants, including cost saving actions and the prepayment of
debt.
The new home construction and repair
and remodeling markets have declined.
Beginning
in the second half of 2006, we saw a significant slowdown in the Florida housing
market. This slowdown continued during 2007, 2008, and the first
three quarters of 2009, and we expect this trend to continue in 2010 and
possibly further. Like many building material suppliers in the
industry, we have been and will continue to be faced with a challenging
operating environment due to this decline in the housing
market. Specifically, new single family housing permits in Florida
decreased by 49% in 2007 and 47% in 2008 each as compared to the prior
year. Beginning in the third quarter of 2008, we began to see a
decrease in consumer spending for repair and remodeling projects as credit
tightened and many homeowners lost substantial equity in their homes. The
resulting decline in new home and repair and remodeling construction levels by
our customers has decreased demand for our products which has had, and which
could continue to have, an adverse impact on our sales and results of
operations.
Current economic and credit market
conditions have increased the risk that we may not collect a greater percentage
of our receivables.
Economic
and credit conditions have negatively impacted our bad debt expense which
has adversely impacted our results of operations. If these conditions
persist, our results of operations may continue to be adversely impacted by bad
debts. We monitor our customers’ credit profiles carefully and make changes in
our terms when necessary in response to this heightened risk.
We are subject to fluctuations in the
prices of our raw materials.
We
experience significant fluctuations in the cost of our raw materials, including
aluminum extrusion, polyvinyl butyral and glass. A variety of factors over which
we have no control, including global demand for aluminum, fluctuations in oil
prices, speculation in commodities futures and the creation of new laminates or
other products based on new technologies impact the cost of raw materials we
purchase for the manufacture of our products. While we attempt to minimize our
risk from severe price fluctuations by entering into aluminum forward contracts
to
10
hedge
these fluctuations in the purchase price of aluminum extrusion we use in
production, substantial, prolonged upward trends in aluminum prices could
significantly increase the cost of the unhedged portions of our aluminum needs
and have an adverse impact on our results of operations. We anticipate that
these fluctuations will continue in the future. While we have entered into a
three-year supply agreement through early 2012 with a major producer of
polyvinyl butyral that we believe provides us with a reliable, single source for
polyvinyl butyral with stable pricing on favorable terms, if one or both parties
to the agreement do not satisfy the terms of the agreement it may be terminated
which could result in our inability to obtain polyvinyl butyral on commercially
reasonable terms having an adverse impact on our results of
operations. While historically we have to some extent been able to pass on
significant cost increases to our customers, our results between periods may be
negatively impacted by a delay between the cost increases and price increases in
our products.
We depend on third-party suppliers
for our raw materials.
Our
ability to offer a wide variety of products to our customers depends on receipt
of adequate material supplies from manufacturers and other suppliers. Generally,
our raw materials and supplies are obtainable from various sources and in
sufficient quantities. However, it is possible that our competitors or other
suppliers may create laminates or products based on new technologies that are
not available to us or are more effective than our products at surviving
hurricane-force winds and wind-borne debris or that they may have access to
products of a similar quality at lower prices. Although in many instances
we have agreements with our suppliers, these agreements are generally terminable
by either party on limited notice. Moreover, other than with our suppliers of
polyvinyl butyral and aluminum, we do not have long-term contracts with the
suppliers of our raw materials.
Transportation costs represent a
significant part of our cost structure.
Dramatic
fluctuations in fuel prices from the beginning of 2008 to the present directly
and significantly impacted our distribution costs. Another rapid or
prolonged increase in fuel prices may significantly increase our costs and have
an adverse impact on our results of operations.
The home building industry and the
home repair and remodeling sector are regulated.
The
homebuilding industry and the home repair and remodeling sector are subject to
various local, state, and federal statutes, ordinances, rules, and regulations
concerning zoning, building design and safety, construction, and similar
matters, including regulations that impose restrictive zoning and density
requirements in order to limit the number of homes that can be built within the
boundaries of a particular area. Increased regulatory restrictions could limit
demand for new homes and home repair and remodeling products and could
negatively affect our sales and results of operations.
Our operating results are
substantially dependent on sales of our WinGuard branded line of products.
A
majority of our net sales are, and are expected to continue to be, derived from
the sales of our WinGuard branded line of products. Accordingly, our future
operating results will depend on the demand for WinGuard products by current and
future customers, including additions to this product line that are subsequently
introduced. If our competitors release new products that are superior to
WinGuard products in performance or price, or if we fail to update WinGuard
products with any technological advances that are developed by us or our
competitors or introduce new products in a timely manner, demand for our
products may decline. A decline in demand for WinGuard products as a result of
competition, technological change or other factors could have a material adverse
effect on our ability to generate sales, which would negatively affect our sales
and results of operations.
Changes in building codes could lower
the demand for our impact-resistant windows and doors.
The
market for our impact-resistant windows and doors depends in large part on our
ability to satisfy state and local building codes that require protection from
wind-borne debris. If the standards in such building codes are raised, we may
not be able to meet their requirements, and demand for our products could
decline. Conversely, if the standards in such building codes are lowered or are
not enforced in certain areas, demand for our impact-resistant products may
decrease. Further, if states and regions that are affected by hurricanes but do
not
11
currently
have such building codes fail to adopt and enforce hurricane protection building
codes, our ability to expand our business in such markets may be
limited.
Our industry is competitive, and
competition may increase as our markets grow or as more states adopt or enforce
building codes that require impact-resistant products.
The
window and door industry is highly competitive. We face significant competition
from numerous small, regional producers, as well as a small number of national
producers. Some of these competitors make products from alternative materials,
including wood. Any of these competitors may (i) foresee the course of
market development more accurately than do we, (ii) develop products that
are superior to our products, (iii) have the ability to produce similar
products at a lower cost, (iv) develop stronger relationships with window
distributors, building supply distributors, and window replacement dealers, or
(v) adapt more quickly to new technologies or evolving customer
requirements than do we. As a result, we may not be able to compete successfully
with them.
In
addition, while we are skilled at creating finished impact-resistant and other
window and door products, the materials we use can be purchased by any existing
or potential competitor. New competitors can enter our industry, and existing
competitors may increase their efforts in the impact-resistant market.
Furthermore, if the market for impact-resistant windows and doors continues to
expand, larger competitors could enter, or expand their presence in the market
and may be able to compete more effectively. Finally, we may not be able to
maintain our costs at a level sufficiently low for us to compete effectively. If
we are unable to compete effectively, demand for our products and our
profitability may decline.
Our
business is currently concentrated in one state.
Our
business is concentrated geographically in Florida. In fiscal year 2008,
approximately 88% of our sales were generated in Florida, and new single family
housing permits in Florida decreased by 47% in 2008 compared to the prior year.
A further or prolonged decline in the economy of the state of Florida or of the
coastal regions of Florida, a change in state and local building code
requirements for hurricane protection, or any other adverse condition in the
state could cause a decline in the demand for our products in Florida, which
could have an adverse impact on our sales and results of
operations.
Our level of indebtedness could
adversely affect our ability to raise additional capital to fund our operations,
limit our ability to react to changes in the economy or our industry, and
prevent us from meeting our obligations under our debt instruments.
As
of October 3, 2009, our indebtedness under our first lien term loan was
$70.0 million. All of our debt was at a variable interest rate. In the
event that interest rates rise, our interest expense would increase. A 1.0%
increase in interest rates would result in approximately $0.7 million of
additional interest expense annually.
The
level of our debt could have certain consequences, including:
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·
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increasing
our vulnerability to general economic and industry
conditions;
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·
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requiring
a substantial portion of our cash flow from operations to be dedicated to
the payment of principal and interest on our indebtedness, therefore
reducing our ability to use our cash flow to fund our operations, capital
expenditures, and future business opportunities;
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·
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exposing
us to the risk of increased interest rates because certain of our
borrowings, including borrowings under our credit facilities, will be at
variable rates of interest;
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·
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limiting
our ability to obtain additional financing for working capital, capital
expenditures, debt service requirements, acquisitions, and general
corporate or other purposes; and
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·
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limiting
our ability to adjust to changing market conditions and placing us at a
competitive disadvantage compared to our competitors who have less
debt.
|
We may incur additional
indebtedness.
12
We may incur additional indebtedness
under our credit facilities, which provide for up to $30 million of
revolving credit borrowings. In addition, we and our subsidiary may be able to
incur substantial additional indebtedness in the future, including secured debt,
subject to the restrictions contained in the agreements governing our credit
facilities. If new debt is added to our current debt levels, the related risks
that we now face could intensify.
Our debt instruments contain various
covenants that limit our ability to operate our business.
Our credit facility contains various
provisions that limit our ability to, among other things, transfer or sell
assets, including the equity interests of our subsidiary, or use asset sale
proceeds; pay dividends or distributions on our capital stock or repurchase
our capital stock; make certain restricted payments or
investments; create liens to secure debt; enter into transactions with
affiliates; merge or consolidate with another company; and engage in
unrelated business activities.
In addition, our credit facilities
require us to meet specified financial ratios. These covenants may restrict our
ability to expand or fully pursue our business strategies. Our ability to comply
with these and other provisions of our credit facilities may be affected by
changes in our operating and financial performance, changes in general business
and economic conditions, adverse regulatory developments, or other events beyond
our control. The breach of any of these covenants, including those contained in
our credit facilities, could result in a default under our indebtedness, which
could cause those and other obligations to become due and payable. If any of our
indebtedness is accelerated, we may not be able to repay it.
We may be adversely affected by any
disruption in our information technology systems.
Our operations are dependent upon our
information technology systems, which encompass all of our major business
functions. A disruption in our information technology systems for any prolonged
period could result in delays in receiving inventory and supplies or filling
customer orders and adversely affect our customer service and
relationships.
We
may be adversely affected by any disruptions to our manufacturing facilities or
disruptions to our customer, supplier, or employee base.
Any disruption to our facilities
resulting from hurricanes and other weather-related events, fire, an act of
terrorism, or any other cause could damage a significant portion of our
inventory, affect our distribution of products, and materially impair our
ability to distribute our products to customers. We could incur significantly
higher costs and longer lead times associated with distributing our products to
our customers during the time that it takes for us to reopen or replace a
damaged facility. In addition, if there are disruptions to our customer and
supplier base or to our employees caused by hurricanes, our business could be
temporarily adversely affected by higher costs for materials, increased shipping
and storage costs, increased labor costs, increased absentee rates, and
scheduling issues. Furthermore, some of our direct and indirect suppliers have
unionized work forces, and strikes, work stoppages, or slowdowns experienced by
these suppliers could result in slowdowns or closures of their facilities. Any
interruption in the production or delivery of our supplies could reduce sales of
our products and increase our costs.
The nature of our business exposes us
to product liability and warranty claims.
We are involved in product liability
and product warranty claims relating to the products we manufacture and
distribute that, if adversely determined, could adversely affect our financial
condition, results of operations, and cash flows. In addition, we may be exposed
to potential claims arising from the conduct of homebuilders and home remodelers
and their sub-contractors. Although we currently maintain what we believe to be
suitable and adequate insurance in excess of our self-insured amounts, we may
not be able to maintain such insurance on acceptable terms or such insurance may
not provide adequate protection against potential liabilities. Product liability
claims can be expensive to defend and can divert the attention of management and
other personnel for significant periods, regardless of the ultimate outcome.
Claims of this nature could also have a negative impact on customer confidence
in our products and our company.
13
We are subject to potential exposure
to environmental liabilities and are subject to environmental
regulation.
We are subject to various federal,
state, and local environmental laws, ordinances, and regulations. Although we
believe that our facilities are in material compliance with such laws,
ordinances, and regulations, as owners and lessees of real property, we can be
held liable for the investigation or remediation of contamination on such
properties, in some circumstances, without regard to whether we knew of or were
responsible for such contamination. Remediation may be required in the future as
a result of spills or releases of petroleum products or hazardous substances,
the discovery of unknown environmental conditions, or more stringent standards
regarding existing residual contamination. More burdensome environmental
regulatory requirements may increase our general and administrative costs and
may increase the risk that we may incur fines or penalties or be held liable for
violations of such regulatory requirements.
We conduct all of our operations
through our subsidiary, and rely on payments from our subsidiary to meet all of
our obligations.
We are a holding company and derive all
of our operating income from our subsidiary, PGT Industries, Inc. All of our
assets are held by our subsidiary, and we rely on the earnings and cash flows of
our subsidiary to meet our debt service obligations. The ability of our
subsidiary to make payments to us will depend on its respective operating
results and may be restricted by, among other things, the laws of its
jurisdiction of organization (which may limit the amount of funds available for
distributions to us), the terms of existing and future indebtedness and other
agreements of our subsidiary, including our credit facilities, and the covenants
of any future outstanding indebtedness we or our subsidiary incur.
We are exposed to risks relating to
evaluations of controls required by Section 404 of the Sarbanes-Oxley Act
of 2002.
We are required to comply with
Section 404 of the Sarbanes-Oxley Act of 2002. While we have concluded that
at January 3, 2009, we have no material weaknesses in our internal controls over
financial reporting, we cannot assure you that we will not have a material
weakness in the future. A “material weakness” is a deficiency, or combination of
deficiencies, that might prevent prudent officials in the conduct of their own
affairs from concluding that they have reasonable assurance that transactions
are recorded as necessary to permit the preparation of financial statements in
conformity with generally accepted accounting principles. If we fail to maintain
a system of internal controls over financial reporting that meets the
requirements of Section 404, we might be subject to sanctions or
investigation by regulatory authorities such as the SEC or by the NASDAQ Stock
Market LLC. Additionally, failure to comply with Section 404 or the report
by us of a material weakness may cause investors to lose confidence in our
financial statements and our stock price may be adversely affected. If we fail
to remedy any material weakness, our financial statements may be inaccurate, we
may not have access to the capital markets, and our stock price may be adversely
affected.
The controlling position of JLL Fund
IV limits the
ability of our minority stockholders
to influence corporate
matters.
JLL Fund IV owned approximately
[●]% of our outstanding common stock as of [●], 2010. Accordingly, such JLL
Fund IV has significant influence over our management and affairs and over
all matters requiring stockholder approval, including the election of directors
and significant corporate transactions, such as a merger or other sale of our
company or its assets. This concentration of ownership may have the effect of
delaying or preventing a transaction such as a merger, consolidation, or other
business combination involving us, or discouraging a potential acquirer from
making a tender offer or otherwise attempting to obtain control, even if such a
transaction or change of control would benefit minority stockholders. In
addition, this concentrated control limits the ability of our minority
stockholders to influence corporate matters, and JLL Fund IV, as a
controlling stockholder, could approve certain actions, including a
going-private transaction, without approval of minority stockholders, subject to
obtaining any required approval of our board of directors for such transaction.
As a result, the market price of our common stock could be adversely affected.
14
The controlling position of JLL Fund IV exempts us from certain Nasdaq corporate governance
requirements.
Although
we have satisfied all applicable Nasdaq corporate governance rules, for so long
as an affiliate of JLL Fund IV continues to own more than 50% of our
outstanding shares, we will continue to avail ourselves of the Nasdaq
Rule 5615(c) “controlled company” exemption that applies to companies in
which more than 50% of the stockholder voting power is held by an individual, a
group, or another company. This rule grants us an exemption from the
requirements that we have a majority of independent directors on our board of
directors and that we have independent directors determine the compensation of
executive officers and the selection of nominees to the board of directors.
However, we intend to comply with such requirements in the event that JLL Fund
IV’s ownership falls to or below 50%.
Our
directors and officers who are affiliated with JLL Partners, Inc. do not have
any obligation to report corporate opportunities to us.
Because
some individuals may serve as our directors or officers and as directors,
officers, partners, members, managers, or employees of JLL Partners, Inc. or its
affiliates or investment funds and because such affiliates or investment funds
may engage in similar lines of business to those in which we engage, our amended
and restated certificate of incorporation allocates corporate opportunities
between us and JLL Partners, Inc. and its affiliates and investment funds.
Specifically, for so long as JLL Partners, Inc. and its affiliates and
investment funds own at least 15% of our shares of common stock, none of JLL
Partners, Inc., nor any of its affiliates or investment funds, or their
respective directors, officers, partners, members, managers, or employees has
any duty to refrain from engaging directly or indirectly in the same or similar
business activities or lines of business as do we. In addition, if any of them
acquires knowledge of a potential transaction that may be a corporate
opportunity for our Company and for JLL Partners, Inc. or its affiliates or
investment funds, subject to certain exceptions, we will not have any expectancy
in such corporate opportunity, and they will not have any obligation to
communicate such opportunity to us.
Risks
Related to the Rights Offering
The
price of our common stock is volatile and may decline before or after the
subscription rights expire.
The
market price of our common stock could be subject to wide fluctuations in
response to numerous factors, including factors that have little or nothing to
do with us or our performance, and these fluctuations could materially reduce
our stock price. These factors include, among other things, actual or
anticipated variations in our operating results and cash flow, the nature and
content of our earnings releases, and our competitors’ and customers’ earnings
releases, announcements of technological innovations that affect our products,
customers, competitors, or markets, changes in financial estimates by securities
analysts, business conditions in our markets and the general state of the
securities markets and the market for similar stocks, the number of shares of
our common stock outstanding, changes in capital markets that affect the
perceived availability of capital to companies in our industries, governmental
legislation or regulation, currency and exchange rate fluctuations, as well as
general economic and market conditions, such as recessions. In addition, the
stock market historically has experienced significant price and volume
fluctuations. These fluctuations are often unrelated to the operating
performance of particular companies. These broad market fluctuations may cause
declines in the market price of our common stock.
We
cannot assure you that the public trading market price of our common stock will
not decline after you elect to exercise your rights. If that occurs,
you may have committed to buy shares of common stock in the rights offering at a
price greater than the prevailing market price and could have an immediate
unrealized loss. Moreover, we cannot assure you that, following the
exercise of your rights, you will be able to sell your common stock at a price
equal to or greater than the subscription price, and you may lose all or part of
your investment in our common stock. Until shares are delivered to
you, you will not be able to sell the shares of our common stock that you
purchase in the rights offering. Certificates representing shares of
our common stock purchased pursuant to the basic subscription privilege will be
delivered promptly after payment is received; certificates representing shares
of our common stock purchased pursuant to the over-subscription privilege will
be delivered promptly after expiration
15
of
the rights offering and after all pro rata allocations and
adjustments have been completed. We will not pay you interest on funds delivered
to the subscription agent pursuant to the exercise of rights.
When
the rights offering is completed, your relative ownership interest may
experience significant dilution.
To
the extent that you do not exercise your rights and shares are purchased by
other stockholders in the rights offering, your proportionate voting interest
will be reduced, and the percentage that your original shares represent of our
expanded equity after exercise of the rights will be diluted.
If,
upon completion of the rights offering, JLL Fund IV purchases its pro rata share of the shares
of common stock issuable in the rights offering (or a greater percentage
pursuant to exercise of its over-subscription privilege), it will continue to
beneficially own at least approximately [●]% of our issued and outstanding
common stock, and, as a result, it will continue to have the ability to exercise
substantial control over matters requiring stockholder approval. Your
interests as a holder of the common stock may differ from the interests of JLL
Fund IV.
The
subscription rights are not transferable, and there is no market for the
subscription rights.
You
may not sell, give away, or otherwise transfer your subscription
rights. The subscription rights are only transferable by operation of
law. Because the subscription rights are non-transferable, there is
no market or other means for you to directly realize any value associated with
the subscription rights.
The
subscription price determined for the rights offering is not an indication of
the fair value of our common stock.
Our
board of directors determined the subscription price considering the likely cost
of capital from other sources and the price at which our stockholders might be
willing to participate in the rights offering. The subscription price
for a subscription right is $[●] per share, which is [●]% of the closing price
of our common stock on [●], 2010, the day before our board of directors set the
subscription price, and [●]% of the closing price of our common stock on the
record date of [●], 2010. The subscription price is not intended to
bear any relationship to the book value of our assets or our past operations,
cash flows, losses, financial condition, net worth, or any other established
criteria used to value securities. You should not consider the
subscription price to be an indication of the fair value of the common stock to
be offered in the rights offering. After the date of this prospectus,
our common stock may trade at prices above or below the subscription
price.
You
may not revoke your subscription exercise and could be committed to buying
shares above the prevailing market price.
Once
you exercise your subscription rights, you may not revoke the exercise of such
rights. The public trading market price of our common stock may
decline before the subscription rights expire. If you exercise your
subscription rights and, afterwards, the public trading market price of our
common stock decreases below the subscription price, you will have committed to
buying shares of our common stock at a price above the prevailing market
price. Our common stock is traded on the Nasdaq Global Market under
the symbol “PGTI,” and the last reported sales price of our common stock on the
Nasdaq Global Market on [●], 2010, was $[●] per share. Moreover, you
may be unable to sell your shares of common stock at a price equal to or greater
than the subscription price you paid for such shares.
If
you do not act promptly and follow the subscription instructions, your exercise
of subscription rights may be rejected.
Stockholders
who desire to purchase shares in the rights offering must act promptly to ensure
that all required forms and payments are actually received by the subscription
agent before 5:00 p.m., Eastern Time, on [●], 2010, the expiration date of the
rights offering, unless extended. If you are a beneficial owner of
shares, you must act promptly to ensure that your broker, bank, or other nominee
acts for you and that all required forms and payments are actually received by
the subscription agent on or before 5:00 p.m., Eastern Time, on the expiration
date of the rights offering. We will not be responsible if your
broker, custodian, or nominee fails to ensure that all
16
required
forms and payments are actually received by the subscription agent on or before
5:00 p.m., Eastern Time, on the expiration date of the rights
offering. If you fail to complete and sign the required subscription
forms, send an incorrect payment amount or otherwise fail to follow the
subscription procedures that apply to your exercise in the rights offering, the
subscription agent may, depending on the circumstances, reject your subscription
or accept it only to the extent of the payment received. Neither we
nor our subscription agent undertakes to contact you concerning an incomplete or
incorrect subscription form or payment, nor are we under any obligation to
correct such forms or payment. We have the sole discretion to
determine whether a subscription exercise properly follows the subscription
procedures.
Risks
Related to Our Common Stock
The
price of our common stock historically has experienced significant price
fluctuations, which may make it difficult for you to resell the common
stock.
The
market price of our common stock historically has experienced and may continue
to experience significant price fluctuations similar to those experienced by the
broader stock market in recent years. In addition, the price of our
common stock may fluctuate significantly in response to various factors,
including, but not limited to, variations in our annual or quarterly financial
results; changes by financial research analysts in their estimates of our
earnings or the earnings of our customers or competitors; and conditions in the
economy in general or the homebuilding industry in particular, including
increased competitive pressures and dependence on, and pricing pressures from,
the industry and our customers.
Significant
sales of common stock, or the perception that significant sales may occur in the
future, could adversely affect the market price for our common
stock.
The
sale of substantial amounts of our common stock could adversely affect its
price. Sales of substantial amounts of our common stock in the public
market, and the availability of shares for future sale, including [●] shares of
our common stock to be issued in the rights offering, and [●] shares of our
common stock issuable upon exercise of outstanding options to acquire shares of
our common stock, as of [●], 2010, could adversely affect the prevailing market
price of our common stock. We cannot foresee the impact of such
potential sales on the market, but it is possible that if a significant
percentage of such available shares were attempted to be sold within a short
period of time, the market for our shares would be adversely
affected. It is also unclear whether or not the market for our common
stock could absorb a large number of attempted sales in a short period of time,
regardless of the price at which the same might be offered. Even if a
substantial number of sales do not occur within a short period of time, the mere
existence of this “market overhang” could have a negative impact on the market
for our common stock and our ability to raise additional capital.
17
CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus includes forward-looking statements regarding, among other things,
our financial condition and business strategy. Forward-looking statements
provide our current expectations and projections about future events.
Forward-looking statements include statements about our expectations, beliefs,
plans, objectives, intentions, assumptions, and other statements that are not
historical facts. As a result, all statements other than statements of
historical facts included in this discussion and analysis and located elsewhere
in this document regarding the prospects of our industry and our prospects,
plans, financial position, and business strategy may constitute forward-looking
statements. In addition, forward-looking statements generally can be identified
by the use of forward-looking terminology such as “may,” “could,” “expect,”
“intend,” “estimate,” “anticipate,” “plan,” “foresee,” “believe,” or “continue,”
or the negatives of these terms or variations of them or similar terminology,
but the absence of these words does not necessarily mean that a statement is not
forward-looking.
Forward-looking
statements are subject to known and unknown risks and uncertainties and are
based on potentially inaccurate assumptions that could cause actual results to
differ materially from those expected or implied by the forward-looking
statements. Although we believe that the expectations reflected in these
forward-looking statements are reasonable, we can give no assurance that these
expectations will occur as predicted. All subsequent written and oral
forward-looking statements attributable to us or persons acting on our behalf
are expressly qualified in their entirety by the cautionary statements included
in this document. These forward-looking statements speak only as of the date of
this report. We undertake no obligation to publicly update or revise any
forward-looking statement to reflect circumstances or events after the date of
this report or to reflect the occurrence of unanticipated events, except as may
be required by applicable securities laws. Factors, risks and uncertainties that
could cause actual outcomes and results to be materially different from those
projected include, among others:
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Our
dependence on one line of products for the majority of our net
sales;
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Changes
in building codes or the failure to adopt or enforce building
codes;
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Our
ability to execute our strategic plans;
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Competition
in the highly fragmented window and door industry;
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The
concentration of our business in one state;
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Declines
in the new construction and repair and remodeling end
markets;
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The
fluctuation of prices we pay for raw materials and receive for finished
products;
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Our
level of indebtedness;
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·
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Our
incurrence of additional indebtedness;
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Our
inability to take certain actions because of restrictions in our debt
agreements;
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Dependence
on key personnel;
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Disruptions
in our information technology systems;
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Disruptions
at our manufacturing facilities or in our customer, supplier, or employee
base;
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Exposure
to product liability and warranty claims;
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Exposure
to environmental liabilities and regulation;
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Variability
of our quarterly revenues and
earnings;
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18
| · | Our reliance on our subsidiary; | |
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Economic
and financial uncertainty resulting from terrorism;
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Costs
of being a public company, including the cost of complying with the
Sarbanes-Oxley Act of 2002; and
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Our
ability to meet the requirements of the Sarbanes-Oxley Act of
2002.
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19
USE
OF PROCEEDS
The
net proceeds to us from the sale of all of our shares of common stock offered in
the rights offering are estimated to be approximately $[●] million, after
deducting estimated offering expenses of approximately $[●]. The
proceeds from the rights offering, less expenses incurred in connection with the
rights offering and our recent amendment of our Credit Agreement, will be used
to repay a portion of our outstanding indebtedness under our Credit
Agreement.
20
CAPITALIZATION
The
following table describes capitalization as of October 3, 2009, on an actual
basis and on a pro forma, as-adjusted basis to give effect to the sale of all
[●] shares offered in the rights offering (including application of net proceeds
as described above) at a price of $[●] per share.
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At October 3,
2009
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Historical
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Pro
Forma
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(In
thousands, except share
and
per share amounts)
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||||||||
|
Current
liabilities:
|
||||||||
|
Accounts
payable and accrued liabilities
|
$ | 15,441 | $ | |||||
|
Current
portion of long-term debt
|
103 | — | ||||||
|
Total
current liabilities
|
15,544 | |||||||
|
Long-term
debt
|
70,190 | |||||||
|
Deferred
income taxes
|
17,675 | |||||||
|
Other
liabilities
|
2,658 | |||||||
|
Total
liabilities
|
106,067 | |||||||
|
Commitments
and contingencies(1)
|
— | — | ||||||
|
Shareholders’
equity:
|
||||||||
|
Preferred
stock, par value $0.01 per share; 10,000,000 shares authorized; none
outstanding
|
---- | |||||||
|
Common
stock, par value $0.01 per share; 200,000,000 shares authorized; 35,673
shares issued and 35,303 shares outstanding at October 3,
2009
|
353 | |||||||
|
Additional
paid-in-capital
|
241,588 | |||||||
|
Accumulated
other comprehensive loss
|
(567 | ) | ||||||
|
Accumulated
deficit
|
(173,095 | ) | ( | ) | ||||
|
Total
shareholders' equity
|
68,273 | |||||||
|
Total
capitalization
|
$ | 174,340 | $ | |||||
21
THE
RIGHTS OFFERING
The
Rights
We
are distributing to the record holders of our common stock as of [●], 2010,
non-transferable subscription rights to purchase shares of our common
stock. The subscription price of $[●] per share of our common stock
is equal to [●]% of the closing price of our common stock on [●] , the day
before our board of directors set the subscription price, and [●]% of the
closing price of our common stock on the record date of [●],
2010. The subscription rights will entitle the holders of common
stock to purchase shares of common stock for an aggregate purchase price of
$[●]. See below for additional information regarding subscription by
DTC participants and stockholders who hold their shares in “street name” with
DTC participants.
You
will receive one subscription right for every [●] shares of our common stock
that you owned at the close of business on the record date, subject to
adjustments to eliminate fractional rights. Each subscription right
will entitle the holder thereof to purchase at the subscription price, on or
before 5:00 p.m., Eastern Time, on the expiration date of the rights offering,
one share of common stock. Stockholders who elect to exercise their
basic subscription privilege in full may also subscribe, at the subscription
price, for additional shares of our common stock under their respective
over-subscription privileges (up to the number of shares subscribed for under
the basic subscription privilege) to the extent that other rights holders do not
exercise their basic subscription privileges in full. If a sufficient
number of shares of our common stock are unavailable to fully satisfy the
over-subscription privilege requests, the available shares of common stock will
be sold pro rata among
subscription rights holders who exercised their over-subscription privilege
based on the number of shares each subscription rights holder subscribed for
under the over-subscription privilege.
We
intend to keep the rights offering open until 5:00 p.m., Eastern Time, on [●],
2010, unless our board of directors, in its sole discretion, extends such
time.
Reasons
for the Rights Offering
Prior
to approving the rights offering, our board of directors carefully considered
current market conditions and opportunities, as well as the dilution of the
ownership percentage of the current holders of our common stock that may be
caused by the rights offering.
After
weighing the factors discussed above and the effect of the $[●] in additional
capital, before expenses, that may be generated by the sale of shares pursuant
to the rights offering, our board of directors believes that the rights offering
is in the best interests of the Company. As described in the section
of this prospectus entitled “Use of Proceeds,” the proceeds from the rights
offering, less expenses incurred in connection with the rights offering and our
recent amendment of our Credit Agreement, will be used to repay a portion of our
outstanding indebtedness under our Credit Agreement. Although we
believe that the rights offering will strengthen our financial condition, our
board of directors is not making any recommendation as to whether you should
exercise your subscription rights.
Expiration
of the Rights Offering and Extensions, Amendments, and Termination
You
may exercise your subscription rights at any time before 5:00 p.m., Eastern
Time, on [●], 2010, the expiration date of the rights offering, unless
extended. We may, in our sole discretion, extend the time for
exercising the subscription rights.
We
will extend the duration of the rights offering as required by applicable law,
and we may choose to extend it if we decide that changes in the market price of
our common stock warrant an extension or if we decide to give investors more
time to exercise their subscription rights in the rights offering. We
may extend the expiration date of the rights offering by giving oral or written
notice to the subscription agent and information agent on or before the
scheduled expiration date. If we elect to extend the expiration of
the rights offering, we will issue a press release announcing such extension no
later than 9:00 a.m., Eastern Time, on the next business day after the most
recently announced expiration date.
22
If
you do not exercise your subscription rights on or before 5:00 p.m., Eastern
Time, on [●], 2010, the expiration date of the rights offering, your unexercised
subscription rights will be null and void and will have no value. We
will not be obligated to honor your exercise of subscription rights if the
subscription agent receives the documents relating to your exercise after the
rights offering expires, regardless of when you transmitted the
documents.
Subscription
Privileges
Your
subscription rights entitle you to a basic subscription privilege and an
over-subscription privilege.
Basic Subscription Privilege.
The basic subscription privilege of each whole right entitles you to purchase
one share of our common stock at the subscription price of $[●] per
share. You will receive one subscription right for every [●] shares
of our common stock you owned at the close of business on the record
date. You are not required to exercise all of your subscription
rights unless you wish to purchase shares under your over-subscription
privilege. We will deliver to the holders of record who purchase
shares in the rights offering certificates representing the shares purchased
with a holder’s basic subscription privilege, or, if you hold your shares in
book-entry form, we will credit your account with such shares, promptly
following receipt of a properly completed and signed subscription rights
certificate, together with payment of the subscription price for each share of
common stock subscribed for.
All
rights issued to a stockholder of record who would, in our opinion, be required
to obtain prior clearance or approval from any state, federal, or non-U.S.
regulatory authority for the ownership or exercise of rights or the ownership of
additional shares are null and void and may not be held or exercised by any such
holder.
Over-Subscription Privilege.
In addition to your basic subscription privilege, you may subscribe for
additional shares of our common stock (up to the number of shares for which you
subscribed under your basic subscription privilege), upon delivery of the
required documents and payment of the subscription price of $[●] per share,
before the expiration of the rights offering. You may only exercise
your over-subscription privilege if you exercised your basic subscription
privilege in full and other holders of subscription rights do not exercise their
rights under the basic subscription privileges in full. We will
deliver to the holders of record who purchase shares in the rights offering
certificates representing the shares purchased with a holder’s over-subscription
privilege, or, if you hold your shares in book-entry form, we will credit your
account with such shares, promptly after expiration of the rights offering and
after all pro rata
allocations and adjustments have been completed.
Pro Rata Allocation. If there
are not enough shares of our common stock to satisfy all subscriptions made
under the over-subscription privilege, we will allocate the remaining shares of
our common stock pro
rata, after eliminating all fractional shares, among those
over-subscribing rights holders. “Pro rata” means in proportion to
the number of shares of our common stock that you and the other subscription
rights holders have subscribed for under the over-subscription
privilege.
Full Exercise of Basic Subscription
Privilege. You may exercise your over-subscription privilege only if you
exercise your rights under the basic subscription privilege in
full. To determine if you have fully exercised your rights under the
basic subscription privilege, we will consider only the basic subscription
privilege held by you in the same capacity. For example, suppose that
you were granted subscription rights for shares of our common stock that you own
individually and shares of our common stock that you own collectively with your
spouse. If you wish to exercise your rights under the
over-subscription privilege with respect to the subscription rights you own
individually, but not with respect to the subscription rights you own
collectively with your spouse, you only need to fully exercise your basic
subscription privilege with respect to your individually owned subscription
rights. You do not have to subscribe for any shares under the basic
subscription privilege owned collectively with your spouse to exercise your
individual over-subscription privilege.
When
you complete the portion of your subscription rights certificate to exercise
your rights under the over-subscription privilege, you will be representing and
certifying that you have fully exercised your subscription privileges as to
shares of our common stock that you hold in that capacity. You must
exercise your subscription rights under the over-subscription privilege at the
same time as you exercise your subscription rights under the basic
23
subscription
privilege in full. In exercising your rights under the over-subscription
privilege, you must pay the full subscription price for all the shares you are
electing to purchase.
Return of Excess Payment. If
you exercised your subscription rights under the over-subscription privilege and
are allocated less than all of the shares of our common stock for which you
wished to subscribe, your excess payment for shares that were not allocated to
you will be returned to you by mail, without interest or deduction, promptly
after the expiration of the rights offering.
Intended Purchases. JLL Fund
IV, which owned approximately [●]% of our outstanding shares of common stock as
of the record date, has indicated to us that it intends to exercise its rights
under the basic subscription privilege in full.
No
Fractional Rights
We
will not issue fractional subscription rights or cash in lieu of fractional
rights. Fractional subscription rights will be rounded to the nearest
whole number, with such adjustments as may be necessary to ensure that we offer
[●] shares of common stock in the rights offering. In the unlikely
event that, because of the rounding of fractional subscription rights, the
rights offering would have been subscribed in an amount in excess of [●] shares
of common stock, all holders’ subscription rights will be reduced in an
equitable manner. Any excess subscription funds will be promptly
returned without interest or deduction.
No
Conditions to the Rights Offering
We
may not cancel or terminate the rights offering, nor may we amend the terms of
the rights offering.
Regulatory
Limitations
All
rights issued to a stockholder of record who would, in our opinion, be required
to obtain prior clearance or approval from any state, federal, or non-U.S.
regulatory authority for the ownership or exercise of rights or the ownership of
additional shares are null and void and may not be held or exercised by any such
holder. We are not undertaking to advise you of any such required clearance or
approval or to pay any expenses incurred in seeking such clearance or
approval.
We
reserve the right to refuse to issue shares of our common stock to any
stockholder of record who would, in our opinion, be required to obtain prior
clearance or approval from any state, federal, or non-U.S. regulatory authority
to own or control such shares if, at the time shares are to be issued upon
payment therefor, such holder has not obtained such clearance or
approval.
We
are not offering or selling, or soliciting any purchase of, shares in any state
or other jurisdiction in which this offering is not permitted. We reserve the
right to delay the commencement of this offering in certain states or other
jurisdictions if necessary to comply with local laws. We may elect not to offer
shares to residents of any state or other jurisdiction whose laws would require
a change in this offering in order to carry out this offering in such state or
jurisdiction.
Method
of Subscription—Exercise of Rights
If
you are a record holder of shares of our common stock, you may exercise your
subscription rights by delivering the following to the subscription agent, at or
before 5:00 p.m., Eastern Time, on [●], 2010, the expiration date of the rights
offering, unless we extend the rights offering in our sole
discretion:
|
|
·
|
Your
properly completed and executed subscription rights certificate with any
required signature guarantees or other supplemental documentation;
and
|
|
|
·
|
Your
full subscription price payment for each share subscribed for under your
subscription privileges.
|
24
If
you are a beneficial owner of shares of our common stock whose shares are
registered in the name of a broker, bank, or other nominee, you should instruct
your broker, bank or other nominee to exercise your rights and deliver all
documents and payment on your behalf before 5:00 p.m., Eastern Time, on [●],
2010, the expiration date of the rights offering, unless extended.
Your
subscription rights will not be considered exercised unless the subscription
agent receives from you, your broker, custodian, or nominee, as the case may be,
all of the required documents and your full subscription price payment before
5:00 p.m., Eastern Time, on [●], 2010, the expiration date of the rights
offering, unless extended.
Method
of Payment
Your
payment of the subscription price must be made in United States dollars for the
full number of shares of common stock for which you are subscribing by
either:
|
|
·
|
cashier’s
or certified check drawn upon a United States bank payable to the
subscription agent; or
|
|
|
·
|
wire
transfer of immediately available funds, to the subscription account
maintained by the subscription agent at
[●].
|
For
wire transfer of funds, please ensure that the wire instructions include the
identity of the subscriber paying the subscription price and the subscription
rights certificate number, and send your subscription rights certificate via
overnight courier to be delivered on the next business day following the day of
the wire transfer to the subscription agent. You are responsible for
any wire transfer fees.
Personal
checks will not be accepted.
Receipt
of Payment
Your
payment will be considered received by the subscription agent only
upon:
|
|
·
|
Receipt
by the subscription agent of any cashier’s or certified check drawn upon a
United States bank payable to the subscription agent;
or
|
|
|
·
|
Receipt
of collected funds in the subscription account designated
above.
|
Delivery
of Subscription Materials and Payment
You
should deliver your subscription rights certificate and payment of the
subscription price to the subscription agent by one of the methods described
below:
|
By
Mail:
|
By
Overnight Courier or By Hand:
|
||
Your
delivery to an address or by any method other than as set forth above will not
constitute valid delivery.
Calculation
of Subscription Rights Exercised
If
you do not indicate the number of subscription rights being exercised, or if you
do not forward full payment of the total subscription price payment for the
number of subscription rights that you indicate are being exercised, then you
will be deemed to have exercised your basic subscription privilege with respect
to the maximum number of subscription rights that may be exercised with the
aggregate subscription price payment you delivered to the subscription
agent. Unless you have specified the number of shares you wish to
purchase upon exercise of your over-subscription privilege, any payment in
excess of that required to exercise your basic subscription privilege
will
25
be
refunded. If we do not apply your full subscription price payment to
your purchase of shares of our common stock, we or the subscription agent will
return the excess amount to you by mail, without interest or deduction, promptly
after the expiration date of the rights offering and after all pro rata allocations and
adjustments have been completed.
Your
Funds Will Be Held by the Subscription Agent until Shares of Our Common Stock
Are Issued
The
subscription agent will hold your payment of the subscription price in a
segregated account with other payments received from other subscription rights
holders until we issue your shares of our common stock to you upon payment of
the subscription price for such shares, in the case of shares subscribed for
pursuant to the basic subscription privilege, or upon completion of the rights
offering and after all pro
rata allocations and adjustments have been completed, in the case of
shares subscribed for pursuant to the over-subscription privilege.
Medallion
Guarantee May Be Required
Your
signature on each subscription rights certificate must be guaranteed by an
eligible institution, such as a member firm of a registered national securities
exchange or a member of the Financial Industry Regulatory Authority, or a
commercial bank or trust company having an office or correspondent in the United
States, subject to standards and procedures adopted by the subscription agent,
unless:
|
·
|
Your
subscription rights certificate provides that shares are to be delivered
to you as record holder of those subscription rights;
or
|
|
|
·
|
You
are an eligible institution.
|
Notice
to Brokers and Nominees
If
you are a broker, a trustee, or a depositary for securities who holds shares of
our common stock for the account of others on [●], 2010, the record date, you
should notify the respective beneficial owners of such shares of the rights
offering as soon as possible to find out their intentions with respect to
exercising their subscription rights. You should obtain instructions from the
beneficial owner with respect to their subscription rights, as set forth in the
instructions we have provided to you for your distribution to beneficial
owners. If the beneficial owner so instructs, you should complete the
appropriate subscription rights certificates and submit them to the subscription
agent with the proper payment. If you hold shares of our common stock
for the account(s) of more than one beneficial owner, you may exercise the
number of subscription rights to which all such beneficial owners in the
aggregate otherwise would have been entitled had they been direct record holders
of our common stock on the record date, provided that you, as a nominee record
holder, make a proper showing to the subscription agent by submitting the form
entitled “Nominee Holder Certification” that was provided to you with your
rights offering materials. If you did not receive this form, you
should contact the subscription agent to request a copy.
Beneficial
Owners
If
you are a beneficial owner of shares of our common stock or will receive your
subscription rights through a broker, bank, or other nominee, we will ask your
broker, bank, or other nominee to notify you of the rights
offering. If you wish to exercise your subscription rights, you will
need to have your broker, bank, or other nominee act for you. If you
hold certificates of our common stock directly and would prefer to have your
broker, bank, or other nominee act for you, you should contact your nominee and
request it to effect the transactions for you. To indicate your
decision with respect to your subscription rights, you should complete and
return to your broker, bank, or other nominee the form entitled "Beneficial
Owners Election Form." You should receive this form from your broker, bank, or
other nominee with the other rights offering materials. If you wish
to obtain a separate subscription rights certificate, you should contact the
nominee as soon as possible and request that a separate subscription rights
certificate be issued to you. You should contact your broker, bank,
or other nominee if you do not receive this form, but you believe you are
entitled to participate in the rights offering. We are not
responsible if you do not receive the form from your broker, bank, or nominee or
if you receive it without sufficient time to respond.
26
Instructions
for Completing Your Subscription Rights Certificate
You
should read and follow the instructions accompanying the subscription rights
certificates carefully.
You
are responsible for the method of delivery of your subscription rights
certificate(s) with your subscription price payment to the subscription
agent. If you send your subscription rights certificate(s) and
subscription price payment by mail, we recommend that you send them by
registered mail, properly insured, with return receipt requested. You
should allow a sufficient number of days to ensure delivery to the subscription
agent prior to the time the rights offering expires. You must pay, or
arrange for payment, by means of a certified or cashier’s check or a wire
transfer of immediately available funds. Personal checks will not be
accepted.
Determinations
Regarding the Exercise of Your Subscription Rights
We
will decide all questions concerning the timeliness, validity, form, and
eligibility of the exercise of your subscription rights, and any such
determinations by us will be final and binding. We, in our sole
discretion, may waive, in any particular instance, any defect or irregularity or
permit, in any particular instance, a defect or irregularity to be corrected
within such time as we may determine. We will not be required to make
uniform determinations in all cases. We may reject the exercise of
any of your subscription rights because of any defect or
irregularity. We will not accept any exercise of subscription rights
until all irregularities have been waived by us or cured by you within such time
as we decide, in our sole discretion.
Neither
we, the subscription agent, nor the information agent will be under any duty to
notify you of any defect or irregularity in connection with your submission of
subscription rights certificates, and we will not be liable for failure to
notify you of any defect or irregularity. We reserve the right to
reject your exercise of subscription rights if we determine that your exercise
is not in accordance with the terms of the rights offering or in proper
form. We will also not accept the exercise of your subscription
rights if our issuance of shares of our common stock to you could be deemed
unlawful under applicable law.
Material
United States Federal Income Tax Consequences
A
holder will not recognize income, gain, or loss for United States federal income
tax purposes in connection with the receipt or exercise of subscription rights
in the rights offering. You should consult your tax advisor as to the
particular consequences to you of the rights offering. For a detailed
discussion, see “Material United States Federal Income Tax
Consequences.”
Questions
about Exercising Subscription Rights
If
you have any questions or require assistance regarding the method of exercising
your subscription rights or requests for additional copies of this document or
the Instructions for Use of PGT, Inc. Subscription Rights Certificates, you
should contact the information agent at the address and telephone number set
forth under “Questions and Answers relating to the Rights Offering” included
elsewhere in this prospectus.
Subscription
Agent and Information Agent
We
have appointed [●] to act as subscription agent and [●] to act as information
agent for the rights offering. You should direct any questions or
requests for assistance concerning the method of subscribing for the shares of
common stock or for additional copies of this prospectus to the information
agent.
Fees
and Expenses
We
will pay all fees charged by the subscription agent and the information agent.
You are responsible for paying any other commissions, fees, taxes, or other
expenses incurred in connection with the exercise of the rights. Neither we nor
the subscription agent will pay such expenses.
27
No
Revocation
Once
you have exercised your subscription privileges, you may not revoke your
exercise. Subscription rights not exercised before the expiration
date of the rights offering will expire and will have no value.
Procedures
for DTC Participants
We
expect that the exercise of your subscription rights under the basic
subscription privilege and over-subscription privilege may be made through the
facilities of the Depository Trust Company (“DTC”). If your
subscription rights are held of record through DTC, you may exercise your rights
under the basic subscription privilege and over-subscription privilege by
instructing DTC to transfer your subscription rights from your account to the
account of the subscription agent, together with certification as to the
aggregate number of subscription rights you are exercising and the number of
shares of our common stock you are subscribing for under your basic subscription
privilege and your over-subscription privilege, if any, and your subscription
price payment for each share of our common stock that you subscribed for
pursuant to your basic subscription privilege and your over-subscription
privilege.
Subscription
Price
The
subscription price is $[●] per share. For more information with
respect to how the subscription price was determined, see “—Reasons for the
Rights Offering” and “Questions and Answers relating to the Rights Offering”
included elsewhere in this prospectus.
Foreign
Stockholders
We
will not mail subscription rights certificates to stockholders on the record
date, or to subsequent transferees, whose addresses are outside the United
States. Instead, we will have the subscription agent hold the
subscription rights certificates for those holders’ accounts. To
exercise their subscription rights, foreign holders must notify the subscription
agent before 11:00 a.m., Eastern Time, on [●], 2010, which is three business
days prior to the initial expiration date, and must establish to the
satisfaction of the subscription agent that they are permitted to exercise their
subscription rights under applicable law. If these procedures are not
followed prior to the expiration date, your rights will expire.
Non-Transferability
of the Rights
Except
in the limited circumstances described below, only you may exercise rights
pursuant to the basic subscription privilege and the over-subscription
privilege. You may not sell, give away, or otherwise transfer the
basic subscription privilege or the over-subscription privilege.
Notwithstanding
the foregoing, your rights may be transferred by operation of law; for example,
a transfer of rights to the estate of the recipient upon the death of the
recipient would be permitted. If the rights are transferred as
permitted, evidence satisfactory to us that the transfer was proper must be
received by us before the expiration date of the rights offering.
No
Board Recommendation
An
investment in shares of our common stock must be made according to each
investor’s evaluation of his own best interests and after considering all of the
information herein, including the risks set forth in the section of this
prospectus entitled “Risk Factors.” Neither we nor our board of
directors makes any recommendation to subscription rights holders regarding
whether they should exercise or sell their subscription rights. You
should not view the intention of JLL Fund IV to exercise its subscription rights
under the basic subscription privilege in full as a recommendation or other
indication, by it or any member of our board of directors, that the exercise of
your subscription rights is in your best interests.
28
Shares
of Common Stock Outstanding after the Rights Offering
Based
on the [●] shares of our common stock currently outstanding as of [●], 2010, and
assuming that all [●] shares of common stock offered in the rights offering are
issued, [●] shares of our common stock will be issued and outstanding following
the rights offering, excluding any shares that may be issued pursuant to the
exercise of stock options.
Dilutive
Effects of the Rights Offering
Even though the subscription rights
will be offered on a pro rata
basis to each holder of our common stock, because of the intent of JLL
Fund IV to exercise its subscription rights in full, the percentage of common
stock owned by stockholders who do not exercise their subscription rights in
full will decrease.
29
PRICE
RANGE OF COMMON STOCK AND DIVIDEND POLICY
Trading
Prices
The
following table sets forth, for the fiscal quarters indicated, the high and low
sales prices for our common stock as reported by the Nasdaq Global Market from
December 30, 2006, through [●].
|
|
High
|
Low
|
||||||
|
Fiscal Year
2007
|
||||||||
|
First
Quarter
|
$ | 13.42 | $ | 11.00 | ||||
|
Second
Quarter
|
13.01 | 10.20 | ||||||
|
Third
Quarter
|
12.41 | 7.86 | ||||||
|
Fourth
Quarter
|
8.71 | 4.69 | ||||||
|
Fiscal Year
2008
|
||||||||
|
First
Quarter
|
$ | 5.00 | $ | 2.59 | ||||
|
Second
Quarter
|
4.25 | 2.18 | ||||||
|
Third
Quarter
|
5.85 | 3.00 | ||||||
|
Fourth
Quarter
|
3.98 | 0.85 | ||||||
|
Fiscal Year
2009
|
||||||||
|
First
Quarter
|
$ | 1.50 | $ | 0.80 | ||||
|
Second
Quarter
|
2.88 | 1.20 | ||||||
|
Third
Quarter
|
3.19 | 1.50 | ||||||
|
Fourth
Quarter (through [●])
|
[●]
|
[●]
|
||||||
Dividend
Policy
We
have not paid any cash dividends since our initial public offering in June 2006.
Any future determination relating to our dividend policy will be made at the
discretion of our board of directors and will depend on a number of factors,
including restrictions in our debt instruments, as well as our future earnings,
capital requirements, financial condition, prospects, and other factors that our
board of directors may deem relevant. The terms of our senior secured credit
facility currently restrict our ability to pay dividends.
30
DESCRIPTION
OF COMMON STOCK
The
following is a summary of the material terms of our capital stock. You are
strongly encouraged, however, to read our amended and restated certificate of
incorporation, amended and restated bylaws and other agreements, copies of which
are available from us upon request or may be found in the “Investors” section of
our website at www.pgtindustries.com under the heading “Corporate
Governance.”
General
Matters
Our
amended and restated certificate of incorporation provides that we are
authorized to issue 200,000,000 shares of common stock, par value $0.01 per
share, and 10,000,000 shares of undesignated preferred stock, par value $0.01
per share.
As
of [●], 2010, we had outstanding [●] shares of common stock (including [●]
shares of restricted common stock) held by [●] stockholders of record. As of
[●], 2010, we had outstanding options (including vested and unvested options) to
purchase [●] shares of our common stock.
Common
Stock
Shares
of our common stock have the following rights, preferences and
privileges:
|
|
·
|
Voting rights. Each
outstanding share of common stock entitles its holder to one vote on all
matters submitted to a vote of our stockholders, including the election of
directors. There are no cumulative voting rights. Generally, all matters
to be voted on by stockholders must be approved by a majority of the votes
entitled to be cast by all shares of common stock present or represented
by proxy.
|
|
|
·
|
Dividends. Holders of
common stock are entitled to receive dividends as, when and if dividends
are declared by our board of directors out of assets legally available for
the payment of dividends.
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·
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Liquidation. In the
event of a liquidation, dissolution or winding up of our affairs, whether
voluntary or involuntary, after payment of our liabilities and obligations
to creditors, our remaining assets will be distributed ratably among the
holders of shares of common stock on a per share basis. If we have any
preferred stock outstanding at such time, holders of the preferred stock
may be entitled to distribution and/or liquidation preferences. In either
such case, we will need to pay the applicable distribution to the holders
of our preferred stock before distributions are paid to the holders of our
common stock.
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·
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Rights and preferences.
Our common stock has no preemptive, redemption, conversion, sinking fund,
or subscription rights. The rights, powers, preferences and privileges of
holders of our common stock are subject to, and may be adversely affected
by, the rights of the holders of shares of any series of preferred stock
that we may designate and issue in the
future.
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Listing
The
common stock is listed on the Nasdaq Global Market under the trading symbol
“PGTI.”
Preferred
Stock
Our
amended and restated certificate of incorporation provides that the board of
directors has the authority, without action by the stockholders, to designate
and issue up to 10,000,000 shares of preferred stock in one or more classes or
series and to fix the powers, rights, preferences, and privileges of each class
or series of preferred stock, including dividend rights, conversion rights,
voting rights, terms of redemption, liquidation preferences, and the number of
shares constituting any class or series, which may be greater than the rights of
the holders of the common stock. There will be no shares of preferred stock
outstanding immediately after the closing of this offering. Any issuance of
shares of preferred stock could adversely affect the voting power of holders of
common stock, and the likelihood that the holders will receive dividend payments
and payments upon liquidation could have the effect of
31
delaying,
deferring, or preventing a change in control. We have no present plans to issue
any shares of preferred stock.
Registration
Rights
Our
amended and restated security holders’ agreement with certain of our
stockholders, including JLL Fund IV and certain of our executive officers,
provides that, upon the request of JLL Fund IV, we will register under the
Securities Act of 1933, as amended, shares of our common stock held by JLL Fund
IV for sale in accordance with its intended method of disposition, and will take
other actions as are necessary to permit the sale of the shares in various
jurisdictions. In addition, if we register any of our equity securities either
for our own account or for the account of other security holders, JLL Fund IV is
entitled to notice of the registration and may include its shares in the
registration, subject to certain customary underwriters’ “cut-back” provisions.
All fees, costs, and expenses of underwritten registrations will be borne by us,
other than underwriting discounts and selling commissions, which will be borne
by each stockholder selling its shares. Our obligation to register the shares
and take other actions is subject to certain restrictions on, among other
things, the frequency of requested registrations, the number of shares to be
registered and the duration of these rights.
Anti-Takeover
Effects of Certain Provisions of Our Certificate of Incorporation and
Bylaws
Our
amended and restated certificate of incorporation and amended and restated
bylaws contain provisions that are intended to enhance the likelihood of
continuity and stability in the composition of the board of directors and that
may have the effect of delaying, deferring, or preventing a future takeover or
change in control of our Company unless the takeover or change in control is
approved by our board of directors. These provisions include the
following:
Staggered Board of Directors.
Our amended and restated certificate of incorporation provides for a staggered
board of directors, divided into three classes, with our stockholders electing
one class each year. Between stockholders’ meetings, the board of directors will
be able to appoint new directors to fill vacancies or newly created
directorships so that no more than the number of directors in any given class
could be replaced each year and it would take three successive annual meetings
to replace all directors.
Elimination of stockholder action
through written consent. Our amended and restated certificate of
incorporation provides that stockholder action can be taken only at an annual or
special meeting of stockholders and cannot be taken by written consent in lieu
of a meeting.
Elimination of the ability to call
special meetings. Our amended and restated certificate of incorporation
provides that, except as otherwise required by law, special meetings of our
stockholders can only be called pursuant to a resolution adopted by a majority
of our board of directors, a committee of the board of directors that has been
duly designated by the board of directors and whose powers and authority include
the power to call such meetings, or by our chief executive officer or the
chairman of our board of directors. Stockholders are not permitted to call a
special meeting or to require our board to call a special meeting.
Advance notice procedures for
stockholder proposals. Our amended and restated bylaws establish an
advance notice procedure for stockholder proposals to be brought before an
annual meeting of our stockholders, including proposed nominations of persons
for election to our board. Stockholders at our annual meeting may only consider
proposals or nominations specified in the notice of meeting or brought before
the meeting by or at the direction of our board or by a stockholder who was a
stockholder of record on the record date for the meeting, who is entitled to
vote at the meeting and who has given to our secretary timely written notice, in
proper form, of the stockholder's intention to bring that business before the
meeting.
Removal of Directors; Board of
Directors Vacancies. Our certificate of incorporation and bylaws provide
that members of our board of directors may not be removed without cause. Our
bylaws further provide that only our board of directors may fill vacant
directorships, except in limited circumstances. These provisions would prevent a
stockholder from gaining control of our board of directors by removing incumbent
directors and filling the resulting vacancies with such stockholder's own
nominees.
32
Amendment of certificate of
incorporation and bylaws. The General Corporation Law of the State of
Delaware, or DGCL, provides generally that the affirmative vote of a majority of
the outstanding shares entitled to vote is required to amend or repeal a
corporation's certificate of incorporation or bylaws, unless the certificate of
incorporation requires a greater percentage. Our certificate of incorporation
generally requires the approval of the holders of at least two-thirds of the
voting power of the issued and outstanding shares of our capital stock entitled
to vote in connection with the election of directors to amend any provisions of
our certificate of incorporation described in this section. Our certificate of
incorporation and bylaws provide that the holders of at least two-thirds of the
voting power of the issued and outstanding shares of our capital stock entitled
to vote in connection with the election of directors have the power to amend or
repeal our bylaws. In addition, our certificate of incorporation grants our
board of directors the authority to amend and repeal our bylaws without a
stockholder vote in any manner not inconsistent with the laws of the State of
Delaware or our certificate of incorporation.
The
foregoing provisions of our amended and restated certificate of incorporation
and amended and restated bylaws could discourage potential acquisition proposals
and could delay or prevent a change in control. These provisions are intended to
enhance the likelihood of continuity and stability in the composition of our
board of directors and in the policies formulated by our board of directors and
to discourage certain types of transactions that may involve an actual or
threatened change of control. These provisions are designed to reduce our
vulnerability to an unsolicited acquisition proposal. The provisions also are
intended to discourage certain tactics that may be used in proxy fights.
However, such provisions could have the effect of discouraging others from
making tender offers for our shares and, as a consequence, they also may inhibit
fluctuations in the market price of the common stock that could result from
actual or rumored takeover attempts. Such provisions also may have the effect of
preventing changes in our management or delaying or preventing a transaction
that might benefit you or other minority stockholders.
Corporate
Opportunities
In
recognition that directors, officers, partners, members, managers and/or
employees of JLL Partners, Inc. and their respective affiliates and investment
funds, which we refer to as the Sponsor Entities, may serve as our directors
and/or officers, and that the Sponsor Entities may engage in similar activities
or lines of business that we do, our amended and restated certificate of
incorporation provides for the allocation of certain corporate opportunities
between us and the Sponsor Entities. Specifically, none of the Sponsor Entities
or any director, officer, partner, member, manager or employee of the Sponsor
Entities has any duty to refrain from engaging directly or indirectly in the
same or similar business activities or lines of business that we do. In the
event that any Sponsor Entity acquires knowledge of a potential transaction or
matter which may be a corporate opportunity for itself and us, we will not have
any expectancy in such corporate opportunity, and the Sponsor Entity will not
have any duty to communicate or offer such corporate opportunity to us and may
pursue or acquire such corporate opportunity for itself or direct such
opportunity to another person. In addition, if a director or officer of our
Company who is also a director, officer, member, manager or employee of any
Sponsor Entity acquires knowledge of a potential transaction or matter which may
be a corporate opportunity for us and a Sponsor Entity, we will not have any
expectancy in such corporate opportunity unless such corporate opportunity is
expressly offered to such person in his or her capacity as a director or officer
of our Company.
The
above provision shall automatically, without any need for any action by us, be
terminated and void at such time as the Sponsor Entities beneficially own less
than 15% of our shares of common stock.
In
recognition that we may engage in material business transactions with the
Sponsor Entities, from which we are expected to benefit, our amended and
restated certificate of incorporation provides that any of our directors or
officers who are also directors, officers, partners, members, managers and/or
employees of any Sponsor Entity will have fully satisfied and fulfilled his or
her fiduciary duty to us and our stockholders with respect to such transaction,
if: the transaction was fair to us and was made on terms that are not less
favorable to us than could have been obtained from a bona fide third party at
the time we entered into the transaction; and either the transaction was
approved, after being made aware of the material facts of the relationship
between each of the Company or a subsidiary thereof and the Sponsor Entity and
the material terms and facts of the transaction, by (i) an affirmative vote of a
majority of the members of our board of directors who do not have a material
financial interest in the transaction, referred to as Interested Persons or (ii)
an affirmative vote of a majority of the members of a committee of our board of
directors consisting of members who are not interested persons; or the
transaction was approved by
33
an
affirmative vote of the holders of a majority of shares of our common stock
entitled to vote, excluding the Sponsor Entities and any interested
person.
Transfer
Agent and Registrar
The
transfer agent and registrar for our common stock is American Stock Transfer
& Trust Company, LLC, and its telephone number is (800)
937-5449.
34
MATERIAL
UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
The
following discussion is a summary of the material United States Federal income
tax consequences of the rights offering to holders of our common stock. This
discussion assumes that the holders of our common stock hold such common stock
as a capital asset for United States Federal income tax purposes. This
discussion is based on the Internal Revenue Code of 1986, as amended, Treasury
Regulations promulgated thereunder, Internal Revenue Service rulings and
pronouncements and judicial decisions in effect on the date hereof, all of which
are subject to change (possibly with retroactive effect) and to differing
interpretations. This discussion applies only to holders that are United States
persons and does not address all aspects of United States federal income
taxation that may be relevant to holders in light of their particular
circumstances or to holders who may be subject to special tax treatment under
the Internal Revenue Code, including, without limitation, holders who are
dealers in securities or foreign currency, foreign persons, insurance companies,
tax-exempt organizations, banks, financial institutions, broker-dealers, holders
who hold our common stock as part of a hedge, straddle, conversion or other risk
reduction transaction, or who acquired our common stock pursuant to the exercise
of compensatory stock options or otherwise as compensation.
We
have not sought, and will not seek, an opinion of counsel or a ruling from the
Internal Revenue Service regarding the United States Federal income tax
consequences of the rights offering or the related share issuance. The following
summary does not address the tax consequences of the rights offering or the
related share issuance under foreign, state or local tax laws. ACCORDINGLY, EACH
HOLDER OF OUR COMMON STOCK SHOULD CONSULT ITS TAX ADVISOR WITH RESPECT TO THE
PARTICULAR TAX CONSEQUENCES OF THE RIGHTS OFFERING AND THE RELATED SHARE
ISSUANCE TO SUCH HOLDER.
The
United States Federal income tax consequences to a holder of our common stock of
the receipt and exercise of subscription rights under the rights offering should
be as follows:
1.
A holder will not recognize taxable income for United States Federal income tax
purposes in connection with the receipt of subscription rights in the rights
offering.
2. Except
as provided in the following sentence, a holder’s tax basis in the subscription
rights received in the rights offering will be zero. If either (i) the fair
market value of the subscription rights on the date such subscription rights are
distributed is at least 15% of the fair market value on such date of the common
stock with respect to which the subscription rights are received or (ii) the
holder elects, in its United States Federal income tax return for the taxable
year in which the subscription rights are received, to allocate part of its tax
basis in such common stock to the subscription rights, then upon exercise of the
subscription rights, the holder’s tax basis in the common stock will be
allocated between the common stock and the subscription rights in proportion to
their respective fair market values on the date the subscription rights are
distributed. A holder’s holding period for the subscription rights received in
the rights offering will include the holder’s holding period for the common
stock with respect to which the subscription rights were received.
3.
A holder which allows the subscription rights received in the rights offering to
expire will not recognize any gain or loss, and the tax basis in the common
stock owned by such holder with respect to which such subscription rights were
distributed will equal the tax basis in such common stock immediately before the
receipt of the subscription rights in the rights offering.
4. A
holder will not recognize any gain or loss upon the exercise of the subscription
rights received in the rights offering. The tax basis in the common stock
acquired through exercise of the subscription rights will equal the sum of the
subscription price for the common stock and the holder's tax basis, if any, in
the rights as described above. The holding period for the common stock acquired
through exercise of the subscription rights should begin on the date the
subscription rights are exercised.
35
PLAN
OF DISTRIBUTION
On
or about [●], 2010, we will distribute the subscription rights, subscription
rights certificates, and copies of this prospectus to individuals who owned
shares of common stock on [●], 2010. If you wish to exercise your
rights and purchase shares of common stock, you should complete the rights
certificate and return it with payment for the shares, to the subscription
agent, [●], at the following address:
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By
Mail:
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By
Overnight Courier or By Hand:
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See
further the section of this prospectus entitled “The Rights
Offering.” If you have any questions, you should contact the
information agent, [●], at [●].
Other
than as described herein, we do not know of any existing agreements between any
stockholder, broker, dealer, underwriter, or agent relating to the sale or
distribution of the underlying common stock.
The
validity of the shares of common stock issuable upon exercise of the
subscription rights will be passed upon for us by Skadden, Arps, Slate, Meagher
& Flom LLP.
EXPERTS
The
consolidated financial statements of PGT, Inc. appearing in PGT, Inc.’s Annual
Report (Form 10-K) for the years ended January 3, 2009 and December 29, 2007 and
the related consolidated statements of operations, changes in shareholders’
equity and cash flows for the years ended January 3, 2009, December 29, 2007 and
December 30, 2006, and the effectiveness of PGT, Inc.’s internal control over
financial reporting as of January 3, 2009 have been audited by Ernst & Young
LLP, independent registered public accounting firm, as set forth in their
reports thereon, included therein, and incorporated herein by reference. Such
consolidated financial statements are incorporated herein by reference in
reliance upon such reports given on the authority of such firm as experts in
accounting and auditing.
36
WHERE
YOU CAN FIND MORE INFORMATION
We
are subject to the information reporting requirements of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), and, in accordance with these
requirements, we are required to file periodic reports and other information
with the United States Securities and Exchange Commission (the
“SEC”). The reports and other information filed by us with the SEC
may be inspected and copied at the public reference facilities maintained by the
SEC as described below.
You
may copy and inspect any materials that we file with the SEC at the SEC's Public
Reference Room at 100 F Street, N.E., Washington, D.C. Please call
the SEC at 1-800-SEC-0330 for further information about the operation of the
public reference rooms. The SEC also maintains an internet website at
http://www.sec.gov that contains our filed reports, proxy and information
statements, and other information that we file electronically with the
SEC. Additionally, we make these filings available, free of charge,
on our website at www.pgtindustries.com as soon as reasonably practicable after
we electronically file such materials with, or furnish them to, the
SEC. The information on our website, other than these filings, is
not, and should not be, considered part of this prospectus, is not incorporated
by reference into this document, and should not be relied upon in connection
with making any investment decision with respect to our common
stock.
INCORPORATION
BY REFERENCE
The SEC allows us to “incorporate by
reference” the information we file with it, which means that we can disclose
important information to you by referring you to those documents. The
information we incorporate by reference is an important part of this prospectus.
We incorporate by reference the documents listed below. The documents we
incorporate by reference include:
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·
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our
Annual Report on Form 10-K for the fiscal year ended January 3, 2009,
filed with the SEC on March 19, 2009;
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·
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our
Quarterly Report on Form 10-Q for the fiscal quarter ended April 4, 2009,
filed with the SEC on May 14, 2009;
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our
Quarterly Report on Form 10-Q for the fiscal quarter ended July 4, 2009,
filed with the SEC on August 12, 2009;
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·
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our
Quarterly Report on Form 10-Q for the fiscal quarter ended October 3,
2009, filed with the SEC on November 12, 2009, as amended on December 17,
2009;
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·
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our amended Current Report on Form 8-K/A, filed
with the SEC on March 26, 2009, and our Current Reports on Form 8-K
filed with the SEC on April 3, 2009, August 18, 2009, October 26, 2009, and December 23,
2009 (other than information contained in such Current Reports
on Form 8-K that is furnished, but not filed); and
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·
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our
Definitive Proxy Statement on Schedule 14A, filed April 20,
2009.
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Any statement contained in a document
that is incorporated by reference in this prospectus will be modified or
superseded for all purposes to the extent that a statement contained in this
prospectus modifies or is contrary to that previous statement. Any statement so
modified or superseded will not be deemed a part of this prospectus except as so
modified or superseded.
We will provide without charge to each
person, including any beneficial owner, to whom this prospectus is delivered,
upon written or oral request, a copy of any or all of the foregoing documents
incorporated herein by reference (other than exhibits unless such exhibits are
specifically incorporated by reference in such documents). Requests for such
documents should be made to us at the following address or telephone
number:
PGT,
Inc.
1070
Technology Drive
North
Venice, Florida 34275
(941)
480-1600
Attention:
Corporate Secretary
37
PROSPECTUS
PGT,
Inc.
Rights
to Purchase up to [●] Shares of Common Stock at $[●] per Share
PART
II
INFORMATION
NOT REQUIRED IN PROSPECTUS
Item
13. Other Expenses of Issuance and Distribution.
The
expenses relating to the registration of the securities registered hereby will
be borne by the registrant. Such expenses are estimated to be as
follows:
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Securities
and Exchange Commission Registration Fee
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$
[_____]
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Subscription
Agent Fees and Expenses
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$
[_____]
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Printing
Costs
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$
[_____]
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Information
Agent Fees and Expenses
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$
[_____]
|
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Accounting
Fees and Expenses
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$
[_____]
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|
Legal
Fees
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$
[_____]
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Miscellaneous
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$
[_____]
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Total
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$
[_____]
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Item
14. Indemnification of Directors and Officers.
The
following summary is qualified in its entirety by reference to the complete text
of any statutes referred to below and the amended and restated certificate of
incorporation and the amended and restated bylaws of PGT, Inc., a Delaware
corporation.
Section
145 of the General Corporation Law of the State of Delaware (the “DGCL”) permits
a Delaware corporation to indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the corporation) by reason of the
fact that the person is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by the person in connection with such action, suit or proceeding if the
person acted in good faith and in a manner the person reasonably believed to be
in or not opposed to the best interests of the corporation, and, with respect to
any criminal action or proceeding, had no reasonable cause to believe the
person's conduct was unlawful.
In
the case of an action by or in the right of the corporation, Section 145 of the
DGCL permits a Delaware corporation to indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action or suit by reason of the fact that the person is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys’ fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by the person in connection with
such action, suit or proceeding if the person acted in good faith and in a
manner the person reasonably believed to be in or not opposed to the best
interests of the corporation and except that no indemnification shall be made in
respect of any claim, issue or matter as to which such person shall have been
adjudged to be liable to the corporation unless and only to the extent that the
Court of Chancery or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but in
view of all the circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which the Court of Chancery or such
other court shall deem proper.
Section
145 of the DGCL also permits a Delaware corporation to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against any liability asserted against
such person and incurred by such person in any such capacity, or arising out of
such person's status as such, whether or not the corporation would have the
power to indemnify such person against such liability under Section 145 of the
DGCL.
II
- 1
Article
ELEVENTH of our amended and restated certificate of incorporation and Article
VIII of our bylaws provide that we shall, to the fullest extent permitted by
applicable law, indemnify each person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action, suit or
proceeding by reason of the fact that he is or was a director or officer of the
Company, or is or was a director or officer of the Company serving at the
request of the Company as a director, officer, employee or agent of another
corporation, limited liability company, partnership, joint venture, trust or
other enterprise. The indemnification provided for in our bylaws is expressly
not exclusive of any other rights to which those seeking indemnification may be
entitled under any law, agreement, or vote of stockholders or disinterested
directors or otherwise. The bylaws also provide that we shall have the power to
purchase and maintain insurance to protect the Company and any director or
officer of the Company against any such expense, liability or loss, whether or
not we would have the power to indemnify such persons against such expense,
liability or loss under the DGCL.
We
maintain an insurance policy on behalf of the Company and its subsidiaries, and
on behalf of the directors and officers thereof, covering certain liabilities
that may arise as a result of the actions of such directors and
officers.
Section
102(b)(7) of the DGCL allows a Delaware corporation to eliminate or limit the
personal liability of directors to a corporation or its stockholders for
monetary damages for a breach of fiduciary duty as a director, except where the
director breached his duty of loyalty, failed to act in good faith, engaged in
intentional misconduct or knowingly violated a law, authorized the payment of a
dividend or approved a stock repurchase or redemption in violation of Delaware
corporate law or obtained an improper personal benefit.
Pursuant
to Section 102(b)(7) of the DGCL, Article FIFTH of our amended and restated
certificate of incorporation eliminates a director's personal liability for
monetary damages to the Company and its stockholders for breaches of fiduciary
duty as a director, except in circumstances involving a breach of a director's
duty of loyalty to the Company or its stockholders, acts or omissions not in
good faith or which involve intentional misconduct or knowing violations of the
law, the unlawful payment of dividends or repurchase of stock, or
self-dealing.
Item
15. Recent Sales of Unregistered Securities.
None.
Item
16. Exhibits and Financial Statement Schedules.
(a) Exhibits. See
the “Exhibit Index” following the signature pages hereto.
(b) Financial
Statement Schedules. Schedules not listed above have been
omitted because the information to be set forth therein is not material, not
applicable or is shown in the financial statements or notes
thereto.
Item
17. Undertakings
The
undersigned registrant hereby undertakes:
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(1)
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To
file, during any period in which offers or sales are being made, a
post-effective amendment to this registration
statement:
|
|
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(i)
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|
To
include any prospectus required by Section 10(a)(3) of the Securities Act
of 1933;
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(ii)
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To
reflect in the prospectus any facts or events arising after the effective
date of the registration statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any deviation
from
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II
- 2
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the
low or high end of the estimated maximum offering range may be reflected
in the form of prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume and price represent no
more than a 20 percent change in the maximum aggregate offering price set
forth in the “Calculation of Registration Fee” table in the effective
registration statement;
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(iii)
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To
include any material information with respect to the plan of distribution
not previously disclosed in the registration statement or any material
change to such information in the registration
statement.
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(2)
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That,
for the purpose of determining any liability under the Securities Act of
1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide
offering thereof.
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(3)
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To
remove from registration by means of a post-effective amendment any of the
securities being registered which remain unsold at the termination of the
offering.
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(4)
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That,
for purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared
effective.
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(5)
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That,
for the purpose of determining any liability under the Securities Act of
1933, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering
thereof.
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(6)
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That,
for the purpose of determining liability of the registrant under the
Securities Act of 1933 to any purchaser in the initial distribution of the
securities:
|
The
undersigned registrant undertakes that in a primary offering of securities of
the undersigned registrant pursuant to this registration statement, regardless
of the underwriting method used to sell the securities to the purchaser, if the
securities are offered or sold to such purchaser by means of any of the
following communications, the undersigned registrant will be a seller to the
purchaser and will be considered to offer or sell such securities to such
purchaser:
|
|
(i)
|
|
Any
preliminary prospectus or prospectus of the undersigned registrant
relating to the offering required to be filed pursuant to Rule
424;
|
|
|
(ii)
|
|
Any
free writing prospectus relating to the offering prepared by or on behalf
of the undersigned registrant or used or referred to by the undersigned
registrant;
|
|
|
|||
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|
(iii)
|
|
The
portion of any other free writing prospectus relating to the offering
containing material information about the undersigned registrant or its
securities provided by or on behalf of the undersigned registrant;
and
|
|
|
|||
|
|
(iv)
|
|
Any
other communication that is an offer in the offering made by the
undersigned registrant to the
purchaser.
|
(7) Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may
be permitted to directors, officers and controlling persons of the registrant
pursuant to the foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in
II
- 3
the
opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
II
- 4
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, the registrant has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of North Venice, State of
Florida, on December 24, 2009.
|
PGT,
INC.
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|||
|
By:
|
/s/
Rodney Hershberger
|
|
|
|
Name:
|
Rodney
Hershberger
|
||
|
Title:
|
President
and Chief Executive Officer
|
||
POWER
OF ATTORNEY
Each person whose signature appears
below hereby constitutes and appoints Mario Ferrucci III his true and lawful
attorney-in-fact and agent with full power of substitution and re-substitution,
for him in his name, place and stead, in any and all capacities, to sign any and
all amendments to this registration statement and any additional registration
statement pursuant to Rule 462(b) under the Securities Act of 1933 and to file
the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorney-in-fact and agent, full power and authority to do and perform each
and every act and thing requisite and necessary to be done, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent or his substitute or
substitutes may lawfully do or cause to be done by virtue hereof.
Pursuant
to the requirements of the Securities Act of 1933, this registration statement
has been signed by the following persons in the capacities and on the dates
indicated.
|
Signature
|
Title
|
Date
|
||
|
/s/
Rodney Hershberger
|
President
and Chief Executive Officer
|
December
24, 2009
|
||
|
Rodney
Hershberger
|
(Principal
Executive Officer and Director)
|
|||
|
/s/
Jeffrey T. Jackson
|
Chief
Financial Officer and Treasurer
|
December
24, 2009
|
||
|
Jeffrey
T. Jackson
|
(Principal
Financial and Accounting Officer)
|
|||
|
/s/
Paul S. Levy
|
Chairman
and Director
|
December
24, 2009
|
||
|
Paul
S. Levy
|
||||
|
/s/
Alexander R. Castaldi
|
Director
|
December
24, 2009
|
||
|
Alexander
R. Castaldi
|
||||
|
/s/
Richard D. Feintuch
|
Director
|
December
24, 2009
|
||
|
Richard
D. Feintuch
|
||||
|
/s/
Ramsey Frank
|
Director
|
December
24, 2009
|
||
|
Ramsey
Frank
|
II
- 5
|
/s/
M. Joseph McHugh
|
Director
|
December
24, 2009
|
||
|
M.
Joseph McHugh
|
||||
|
/s/
Floyd F. Sherman
|
Director
|
December
24, 2009
|
||
|
Floyd
F. Sherman
|
||||
|
/s/
Randy L. White
|
Director
|
December
24, 2009
|
||
|
Randy
L. White
|
||||
|
/s/
Brett N. Milgrim
|
Director
|
December
24, 2009
|
||
|
Brett
N. Milgrim
|
||||
|
/s/
William J. Morgan
|
Director
|
December
24, 2009
|
||
|
William
J. Morgan
|
||||
|
/s/
Daniel Agroskin
|
Director
|
December
24, 2009
|
||
|
Daniel
Agroskin
|
II
- 6
EXHIBIT
INDEX
|
Exhibit
|
Description
|
|
3.1
|
Amended
and Restated Articles of Incorporation of PGT, Inc. (incorporated herein
by reference to Exhibit 3.1 to Amendment No. 3 to the Registration
Statement of the Company on Form S-1, filed with the Securities and
Exchange Commission on June 8, 2006, Registration No.
333-132365).
|
|
3.2
|
Amended
and Restated Bylaws of PGT, Inc. (incorporated herein by reference to
Exhibit 3.1 to Current Report on Form 8-K of the Company, filed with the
Securities and Exchange Commission on December 6, 2007, File No.
000-52059).
|
|
4.1*
|
Form
of Subscription Rights Certificate.
|
|
4.2**
|
Subscription
Agent Agreement, dated as of [●], 2010, by and between
PGT, Inc. and [●].
|
|
5.1**
|
Opinion
of Skadden, Arps, Slate, Meagher & Flom LLP regarding the validity of
the securities being registered.
|
|
23.1*
|
Consent
of Ernst & Young LLP.
|
|
23.2**
|
Consent
of Skadden, Arps, Slate, Meagher & Flom LLP (included as part of
Exhibit 5.1).
|
|
24.1*
|
Powers
of Attorney (included on the signature page hereto).
|
|
99.1*
|
Form
of Instruction for Use of PGT, Inc. Subscription Rights
Certificates.
|
|
99.2*
|
Form
of Letter to Stockholders who are Record Holders.
|
|
99.3*
|
Form
of Letter to Nominee Holders Whose Clients Are Beneficial
Holders.
|
|
99.4*
|
Form
of Letter to Clients of Nominee Holders.
|
|
99.5*
|
Form
of Nominee Holder Certification.
|
|
99.6*
|
Form
of Beneficial Owner Election.
|
|
*
|
Filed
herewith.
|
|
**
|
To
be filed by subsequent amendment.
|
II - 7