Former name, former address and former fiscal year, if changed since last report:

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒ No ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or emerging growth company. See definition of “accelerated filer,” “large accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act Yes ☐ No ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. Yes ☒ No ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The aggregate market value of the registrant’s common stock held by non-affiliates of the registrant as of ~~July 2, 2021~~June 30, 2023 was approximately $~~1,317,945,678~~1,627,882,993 based on the closing price per share on that date of ~~$23.00~~$29.15 as reported on the New York Stock Exchange.

The number of shares of the registrant’s common stock, par value $0.01, outstanding as of February ~~25, 2022,~~24, 2024, was ~~59,899,927~~57,261,697.

The purpose of this Amendment No. 1 (the “Amendment”) to the Annual Report on Form 10-K of PGT Innovations, Inc. (the “Company”) for the year ended January 1, 2022, which was filed with the United States Securities and Exchange Commission (“SEC”) on March 1, 2022 (the “Original Form 10-K”) is (i) to provide, pursuant to Public Company Accounting Oversight Board ("PCAOB") Auditing Standards ("AS"), an updated report of our current independent registered public accounting firm, Ernst & Young LLP (PCAOB ID: 42), that includes the introductory language required by PCAOB AS 3101.15, including the section title "Critical Audit Matter," to immediately precede the critical audit matter discussed in its report, which was inadvertently excluded from its report as filed in the Original Form 10-K due to typographical error; and (ii) to provide the report of our predecessor independent registered public accounting firm, KPMG LLP (PCAOB ID: 185) ("Predecessor Auditor") relating to the Predecessor Auditor's audits of the Company's consolidated financial statements for periods prior to the Company's 2021 fiscal year, including the Company's consolidated balance sheet as of January 2, 2021, and the Company's consolidated statements of operations, comprehensive income, cash flows, and shareholders' equity for the two-year period ended January 2, 2021, which was inadvertently excluded from the Original Form 10-K due to miscommunication between the Company and the Predecessor Auditor regarding the inclusion of the Predecessor Auditor's report in subsequent filings with the SEC.

From time to time, we have made or will make forward-looking statements within the meaning of Section 21E of the Exchange Act. For those statements we claim the protection of the safe harbor provisions for forward-looking statements contained in such section. Forward-looking statements are not a statement of historical facts but are based on management’s current beliefs, assumptions and expectations regarding our future performance, taking account of the information currently available to management. Forward-looking statements usually can be identified by the use of words such as “goal”, “objective”, “plan”, “expect”, “anticipate”, “intend”, “project”, “believe”, “estimate”, “may”, “could”, or other words of similar meaning. Forward-looking statements provide our current expectations or forecasts of future events, results, circumstances or aspirations. Our disclosures in this Annual Report on Form 10-K (this “Report”) contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We may also make forward-looking statements in our other documents filed or furnished with the Securities and Exchange Commission and in oral presentations. Forward-looking statements are based on assumptions and by their nature are subject to risks and uncertainties, many of which are outside of our control. Our actual results may differ materially from those set forth in our forward-looking statements. There is no assurance that any list of risks and uncertainties or risk factors is complete. Factors that could cause actual results to differ materially from those described in our forward-looking statements include, but are not limited to:

Statements in this Report that are forward-looking statements include, without limitation, our expectations regarding: (1) the potential for a continuing impact on our businesses and operations due to the Pandemic, including on demand for our products, order entry, sales, our ability to timely manufacture our products, our supply chain for materials and on our labor force and labor availability; (2) demand for our products going forward, including the demand for our impact-resistant products; (3) our market position and the positioning of our brands; (4) our product innovation; (5) our ability to adjust our operations, sales and other business activities and functions to respond to changes in customer demand, including resulting changes in product mix; (6) our ability to continue to achieve manufacturing and operational efficiencies, including with respect to labor costs; (7) our manufacturing capacity; (8) the economy, and single family housing starts in particular, in the state of Florida and other southeastern states, and in the states in the western United States, including Arizona and California; (9) material and labor costs, including with respect to aluminum, and the impact of the existing labor shortage on our manufacturing costs; (10) the Company’s ability to continue to grow its sales and earnings going forward; (11) our ability to position ourselves as a national leader in the premium window and door market, and our performance in that market; (12) our ability to identify and complete operational and strategic initiatives in the future, and the results of any such initiatives; and (13) our forecasted financial and operational performance for our 2022 fiscal year, including with respect to revenue, gross profit and gross margins, SG&A, income tax expense, interest expense and liquidity and capital resources for 2022. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this Report. Except as required by law, we undertake no obligation to update these forward-looking statements to reflect subsequent events or circumstances after the date of this Report.

Any forward-looking statement made by us in this Annual Report on Form 10-K is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

PGT Innovations, Inc. (“we,” “us,” “our,” “PGTI” or the “Company”) manufactures and supplies premium windows and doors and fully customizable overhead garage doors. Our impact-resistant products can withstand some of the toughest weather conditions on earth and ~~with its Western Window Systems (“WWS”) product lines,~~ unify indoor/outdoor living spaces. We strive to create value through deep customer relationships, understanding the needs of the markets we serve, and a drive to develop category-defining products. We believe we are one of the nation’s largest manufacturers of impact-resistant windows and doors and hold leadership positions in our primary markets. We manufacture diverse lines of products, intended to appeal to different segments of the market, at different price-points, including high-end, luxury, premium and mass-custom fully customizable aluminum and vinyl windows and doors and porch enclosure products, targeting both the residential repair and remodeling and new construction end markets. We market our impact-resistant products under five recognized brands: PGT® Custom Windows & Doors, CGI® Windows and Doors, WinDoor®, NewSouth Window Solutions®, and Eco Enterprises, Inc.~~, following the completion of our acquisition of a 75% ownership stake in Eco effective February 1, 2021.~~® We believe all of these brands are positively associated with service, performance, quality, durability and energy efficiency. We also market a line of window and door products designed to unify indoor/outdoor living spaces under the two recognized brands of Western Window Systems® and Anlin®, ~~following the acquisition of Anlin Windows and Doors effective October 25, 2021 brands,~~ which we believe are associated with innovation, quality, durability and energy efficiency in the indoor/outdoor living space markets. ~~Many~~The acquisition of ~~these brands have been~~Martin® in 2022 added premium overhead garage doors to our ~~portfolio through the acquisitions described below.~~

● ~~On September 22, 2014, we acquired CGI, an innovator in impact-resistant~~ product ~~craftsmanship, strength and style that is recognized and respected in the architect community.~~

● On February 16, 2016, we completed the acquisition of WinDoor, a provider of high-performance, impact-resistant windows and doors to five-star resorts, luxury condominiums, high-rise multi-family buildings, hotels and custom high-end single-family homes.

● On September 6, 2016, we acquired an established fabricator of impact-resistant storefront window and door products, US Impact Systems, Inc. (“USI”), and announced the formation of CGI Commercial, Inc. (“CGIC”), the brand and company through which we sell the former USI products.

● On August 13, 2018, we completed the acquisition of Western Window Systems (the “WWS Acquisition”), an award-winning designer and manufacturer of premium contemporary doors and window systems with a focus on unifying indoor/outdoor living spaces. The WWS Acquisition has increased and diversified our product offerings and enabled us to expand beyond our previous geographically focused portfolio of primarily impact-resistant products.

● On February 1, 2020, we completed the acquisition of NewSouth (the “NewSouth Acquisition”). NewSouth is a manufacturer and installer of factory-direct, energy-efficient windows and doors, including both impact-resistant and non-impact residential products. NewSouth has nine retail showrooms in several locations throughout Florida, with additional showrooms in North Carolina, South Carolina, Texas and Louisiana.

● On February 1, 2021, we completed our previously announced acquisition of 75% of the outstanding equity interests of New Eco Windows Holding, LLC, a Delaware limited liability company newly formed for the purposes of facilitating the acquisition of 100% of the equity interests of Eco Window Systems, LLC, a Florida limited liability company, Eco Glass Production Inc., a Florida corporation and Unity Windows Inc., a Florida corporation, which now operate as Eco

Enterprises, LLC, a Delaware limited liability company, Eco Window Systems, LLC, a Florida limited liability company, Eco Glass Production, LLC, a Florida limited liability company, and Unity Windows, LLC, a Florida limited liability company, respectively (collectively, “Eco”). Eco is a manufacturer and installer of aluminum, impact-resistant windows and doors, serving the South Florida region since 2009. Eco is headquartered in Medley, Florida, near Miami, and has three manufacturing locations in the region.

● On October 25, 2021, we completed the acquisition of Anlin Windows & Doors. Anlin is a top regional brand for vinyl replacement windows and doors and is a great fit with our existing Western Window Systems brand, which is a leading provider of aluminum products for the new home construction market and expands our market presence in the West Coast region, which we believe is a high-growth area. We believe this acquisition allows us to better serve markets in the west with a broad product portfolio and expanded sales network. The acquisition was done by Western Window Holding LLC, a Delaware limited liability company, indirectly wholly-owned by PGT Innovations, Inc., which acquired

substantially all of the assets, properties and rights owned, used or held for use in the business, as operated by Anlin Industries, a California corporation, of manufacturing vinyl windows and doors for the replacement market and the new construction market, and all activities conducted in connection therewith, other than certain expressly excluded assets and liabilities (the "Anlin Acquisition").portfolio.

Our impact-resistant products combine heavy-duty aluminum or vinyl frames with laminated glass to ensure structural integrity, which provides protection from wind-driven projectiles of all sizes and other debris during a storm. Our impact-resistant products substantially reduce the likelihood of penetration by impacting projectiles, protecting people and property, while providing expansive, unblocked exterior views that other forms of protection, such as shutters or wood coverings, do not provide. Our impact-resistant products also offer many other benefits, including: (1) abatement of sound to substantially decrease outside noise, including during hurricanes; (2) protection against the damaging effects of ultra-violet light; (3) reduction of energy loss due to changing external temperatures; and (4) energy efficiency that can significantly reduce cooling and heating costs, as evidenced by the energy ratings our products have received. These impact-resistant products satisfy the nation’s most 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. We also manufacture vinyl porch and patio enclosure products under our Eze-Breeze ® brand, that are designed to allow air flow while protecting against inclement weather, making outdoor spaces more inviting.

The acquisition of NewSouth has supported our diversification into growing segments in the window and door industry, by enabling us to enter the direct-to-consumer channel, where NewSouth is a market leader in Florida. NewSouth's direct-to-consumer model is supported by its showrooms and in-home sales. With the addition of NewSouth, we continued our strategy of growing in geographic areas outside of our core markets, with ~~showroom openings planned for Southern states, including Texas and Georgia.NewSouth has recently opened new~~ showrooms ~~in Pensacola, Florida, Charlotte and Raleigh, North Carolina, Charleston, South Carolina, Houston, Texas, and New Orleans, Louisiana.~~throughout the southern states.

The acquisition of Eco ~~is expected to extend~~extended our residential market footprint with what we believe will be minimal overlap with our existing network of dealers, as most of Eco’s dealer-customers have not historically been our customers. Eco’s product offerings in the commercial market are expected to provide us with added product and customer diversification in that space, which we believe will be a high-growth market in future periods. By adding Eco’s glass manufacturing capabilities to our operations, we ~~will expand~~expanded our glass production capabilities and capacity ~~and expect~~in order to strengthen and gain more control of our supply chain for glass.

The additions of Anlin and Western Window Systems (“WWS”) to our family of brands expanded our portfolio of offerings and our geographical footprint and added award-winning and innovative products that combine performance and quality with clean, functional designs. ~~Its~~Those products are designed for strength, easy integration into a variety of spaces, smooth operation and are tested for durability.

With the addition of Martin, we expanded into an adjacent window and door category by adding premium overhead garage doors to our product portfolio, and broadened our geographic footprint and brand presence in the high-growth Western region. Martin adds another recognized brand to our portfolio of brands, and we believe will open cross-selling opportunities for existing Western division brands and NewSouth Window Solutions.

With approximately ~~5,300~~5,600 employees (as of ~~January 1, 2022)~~December 30, 2023) at our various manufacturing facilities located in North Venice, Tampa, and Fort Myers, on the west coast of Florida, and Hialeah and Medley, on the east coast of Florida, as well as Phoenix, Arizona, ~~and~~ Irvine and Clovis, California, and Salt Lake City, Utah, in the western U.S., our vertically integrated manufacturing capabilities include in-house glass cutting, tempering, laminating and insulating capabilities, which provide us with a consistent source of specialized glass, shorter lead times, lower costs relative to third-party sourcing and an overall more efficient production process. Additionally, our manufacturing process relies on just-in-time delivery of raw materials and components as well as synchronous flow to promote labor efficiency and throughput, allowing us to more consistently fulfill orders on-time for our valued customers. In 2023,

we began construction on our previously announced Diamond Glass Thin Triple glass fabrication facility in Prince George County, Virginia.

The geographic regions in which we currently conduct business include the Southeastern U.S., Western U.S., Gulf Coast, and the Coastal mid-Atlantic. We also ship to the Caribbean, Central America and Canada. We distribute our products through multiple channels, including ~~approximately 2,300~~nearly 4,000 independently-owned dealers and distributors, national building supply distributors, the in-home sales/custom order divisions of major U.S. home building and improvement supply retailers and, with our acquisition of NewSouth, the direct-to-consumer channel. We believe this broad distribution network provides us with the flexibility to meet demand as it shifts between the repair and remodel, and residential and commercial new construction end markets.

PGT Innovations, Inc. is a Delaware corporation. We were formed on December 16, 2003 as PGT, Inc. and operate our business through our various subsidiaries, including PGT Industries, Inc., a Florida corporation, which was founded in 1980 as Vinyl Tech, Inc. On June 27, 2006, we became a publicly listed company on the NASDAQ Global Market (NASDAQ) under the symbol “PGTI”. We changed our name to PGT Innovations, Inc. which we announced on December 14, 2016. Effective on December 28, 2016, the listing of the Company’s common stock was transferred to the New York Stock Exchange (NYSE) and our common stock began trading on the NYSE under our existing ticker symbol of “PGTI”.

We operate as two segments based on geography: the Southeast segment, and the Western segment. See Part II, Item 8. Financial Statements and Supplemental Data, Note ~~20.~~19. Segments for more information.

WinGuard. WinGuard is an impact-resistant product line that combines heavy-duty aluminum or vinyl frames with laminated glass to provide protection from hurricane-force winds and wind-borne debris and satisfies increasingly stringent building codes. Our marketing and sales of the WinGuard product line are primarily targeted to hurricane-prone coastal states in the U.S., as well as the Caribbean and Central America. Combining the impact resistance of WinGuard with insulating glass creates energy efficient windows that can significantly reduce cooling and heating costs. Our “WinGuard Vinyl” line of windows and doors is designed to offer some of the highest design pressures available on impact-resistant windows and doors, in a modern profile, with larger sizes that satisfy the most stringent hurricane codes in the country. It protects against flying debris, intruders, outside noise and UV rays.

EnergyVue. EnergyVue is our non-impact-resistant vinyl window featuring energy-efficient insulating glass and multi-chambered frames that meet or exceed ENERGY STAR® standards in all climate zones to help consumers save on energy costs. Its new design has a refined modern profile and robust construction and is offered in larger sizes and higher design pressures, multiple frame colors, and a variety of hardware finishes, glass tints, grid styles and patterns.

Aluminum. We offer a complete line of fully customizable, non-impact-resistant aluminum frame windows and doors. These products primarily target regions with warmer climates, where aluminum is often preferred due to its ability to withstand higher structural loads. Adding insulating glass creates energy-efficient windows that can significantly reduce cooling and heating costs.

Eze-Breeze. Eze-Breeze non-glass vertical and horizontal sliding panels for porch enclosures are vinyl-glazed, aluminum-framed products used for enclosing screened-in porches that provide protection from inclement weather.

Sentinel. Sentinel is a complete line of aluminum impact-resistant windows and doors from CGI that provides quality craftsmanship, energy efficiency and durability at an affordable price point. Sentinel windows and doors are designed and manufactured with the objectives of enhancing home aesthetics, while delivering protection from hurricane winds and wind-borne debris. Sentinel is custom manufactured to exact sizes within our wide range of design parameters, therefore, reducing on-site construction costs. In addition, Sentinel’s frame depth is designed for both new construction and replacement applications, resulting in faster, less intrusive installations.

Targa. Targa is CGI’s line of vinyl, energy-efficient, impact-resistant windows designed specifically to exceed the Florida impact codes, which are the most stringent impact standards in the U.S. Targa windows are designed with the objective of enhancing the aesthetics of a home, are relatively low maintenance, with long-term durability, and environmental compatibility.

Sparta. Sparta is CGI’s line of aluminum and vinyl impact-resistant windows and doors that are offered at relatively lower price points, and that meet Florida’s impact codes.

Scout. Scout is CGI’s line of aluminum non-impact windows and doors that are offered at a relatively lower price point.

~~Commercial Storefront System.~~ Our Commercial Storefront window system and entry doors are engineered to provide a flexible yet economical solution for a variety of applications. Our system is designed with the goal of providing easy fabrication and assembly, while also reducing installation time and challenges.

WinDoor’s products carry the WinDoor® brand and carry various product names, including its 3000 and 4000 Series aluminum windows, its 6000, 7000 and 8000 Series aluminum sliding glass doors, and its 9000 Series thermally broken windows and doors.

Aluminum Doors and Windows. WinDoor produces a wide array of high-end, luxury aluminum doors and windows, including impact and non-impact sliding glass doors and terrace doors, fixed picture windows, single hung windows, and horizontal rolling windows. All of WinDoor’s aluminum windows are available in impact and non-impact versions and meet or exceed ENERGY STAR® standards in all climate zones.

Thermally Broken Doors and Windows. WinDoor produces a variety of aluminum thermally broken doors and windows. WinDoor’s thermally broken products provide the strength of aluminum with the energy ratings usually seen in only vinyl products. All of WinDoor’s thermally broken products are available in multiple shapes and sizes, have earned high performance ratings on impact and non-impact certifications, and meet or exceed ENERGY STAR® standards in all climate zones.

Estate by WinDoor. Formerly part of CGI, our Estate Collection of windows and doors is one of WinDoor’s premium aluminum impact-resistant product line. These windows and doors can be found in high-end homes, resorts and hotels, and in schools and office buildings. Our Estate Collection combines protection against hurricane force damage with architectural-grade quality, handcrafted details and modern engineering. These windows and doors protect and insulate against hurricane winds and wind-driven debris, outside noise, and offer UV protection. Estate’s aluminum frames are thicker than many of our competitors’ frames, making it a preferable choice for consumers in coastal areas prone to hurricanes.

WWS’s products are non-impact products, and include both customized products for its custom sales channel, and standard products for its volume, production builder, sales channel, and carry the Western Windows Systems® brand under ~~three~~four product categories of the Classic Line, Performance Line, Minimalist Multi-Slide Door, and the Simulated Steel Line.

Classic Line. WWS’s Classic Line is a portfolio of high-quality, disappearing glass walls and windows that combine exceptional performance with clean design. The products of the Classic Line include fixed and operating windows, as well as sliding, folding and hinged doors. Sales of the Classic Line products are focused on the volume/production builder market in relatively temperate areas in the ~~Western~~Southwestern United States.

Performance Line. The Performance Line by WWS is a family of moving glass walls and windows engineered to satisfy its customers’ energy and structural requirements, while promoting a contemporary, modern architectural design. The Performance Line has broad thermal capabilities that allow this luxury line of products to satisfy all energy codes throughout the United States.

Simulated Steel Line. The Simulated Steel Line by WWS is a portfolio of thermally-broken, aluminum moving glass walls and windows that look like steel but are far more affordable. This portfolio of products embodies WWS’s nearly 60 years of advancements in door and window design, and we believe exhibits luxury and refinement. The Simulated Steel Line has clean, narrow profiles which gives the glass components of the products a prominent positioning, while maximizing natural light.

Minimalist Multi-Slide Door. The Minimalist Multi-Slide door by WWS offers innovative narrow interlock stiles that provide a minimalist aesthetic with maximum daylight. This combination of large panel sizes, discreet lines, and energy efficient low-E, dual-pane glass delivers a beautiful new way to minimize the boundaries between indoors and outdoors.

Windows and Doors. NewSouth manufactures a wide array of single-hung, double-hung, sliding, picture and visually appealing shaped vinyl windows which are durable and energy-efficient. NewSouth also manufactures durable and attractive patio and entry doors which we believe enhance safety and improve the appearance of entry spaces.

Installation. NewSouth provides quality installation of its windows and doors through an experienced group of installation services companies who are subcontracted to install its products.

Eco manufactures impact resistant windows and doors which are engineered to meet the toughest standards in the industry at the best price while ensuring the durability, elegance, and safety of all products for both the commercial and residential markets.

Windows and Doors. Eco manufactures a wide array of aluminum single-hung, horizontal rolling, fixed, and casement windows which are all impact resistant. Eco also manufactures several varieties of aluminum, impact-resistant patio and entry doors such as French, sliding, garage, bi-fold, and pivot which we believe complement the existing product lines offered by PGT Custom Windows & Doors and CGI Windows and Doors.

Glass production. Eco produces its own processed glass products, which supplies all of its window and door manufacturing operations’ requirements for glass. Eco’s glass production capacity also allows incremental vertical integration of glass for the production of certain of our other product lines, enabling us to strengthen and gain more control of our supply chain for glass. Eco also sells a small amount of glass other to third-party customers.

Commercial Storefront System. Our Commercial Storefront window system and entry doors are engineered to provide a flexible yet economical solution for a variety of applications. Our system is designed with the goal of providing easy fabrication and assembly, while also reducing installation time and challenges.

Anlin is a California-based recognized brand for vinyl windows and doors in the remodel and replacement market. Anlin produces energy-efficient windows and doors with modern, energy saving technology, with a focus on noise reduction, delivering a high-quality product with appealing design and beauty. Anlin also provides consumer driven specialty products such as hinged patio doors with flexible options like in glass pet doors.

Anlin windows and patio doors are tested and certified by the National Fenestration Rating Council (NFRC), the American Architectural Manufactures Association (AAMA), and Energy Star. Each certification assures homeowners that our windows and patio doors are manufactured to the highest quality and energy ~~standards~~standards.

Martin is headquartered in Salt Lake City, Utah with an operating history exceeding 85 years and is a leading custom manufacturer of premium overhead garage doors and hardware, serving the Western United States. Martin is recognized in the industry for high-quality and fully-customizable products to both commercial and residential end markets.

Our sales strategy primarily focuses on strengthening partnerships with our loyal distributors and dealers in the repair and remodel, and new construction markets by consistently providing exceptional customer service, industry-leading product designs and quality, valuable insight on building code requirements and industry trends, and technical expertise. We also market our products directly to national and regional homebuilders, who then purchase our products from our long-standing network of dealers and distributors. With our acquisition of NewSouth Window Solutions in February 2020, our sales strategy expanded to include a focus on direct-to-consumer sales to meet the growing demand from consumers looking for a manufacturer-to-home selling experience. ~~More recently, our 2021~~Our acquisition of ~~a controlling ownership stake in~~ ECO ~~has provided~~provides us with more product offerings and customer relationships in the commercial market. Our acquisition of Martin in October 2022, has expanded our product portfolio into a new market ~~which we believe will be a high growth market in future periods.~~of commercial and residential garage doors.

Our marketing strategy is designed to promote the quality and benefits of our products and targets both coastal and inland markets across the U.S. We reach our customers through traditional and web-based advertising; consumer promotions; and showrooms and selling materials. We also work with our dealers and distributors to educate architects, building officials, consumers, and homebuilders on the advantages of using impact-resistant and energy-efficient products. We market products from our house of brands to consumers based on performance and life-style benefits they value, as well as through the purchase channels they desire.

We have a highly diversified base of ~~approximately 2,300~~nearly 4,000 window distributors, building supply distributors, window replacement dealers and enclosure ~~contractors.~~contractors and garage door installation dealers. This number includes the distributor networks of ~~Eco and Anlin, both of which we~~Martin, acquired during ~~2021.~~2022. We believe there is minimal overlap with our existing dealer network from the ~~acquisitions~~acquisition of ~~Eco and Anlin.~~Martin.

In 2021, our largest customer accounted for approximately 4% of net sales and our top ten customers accounted for approximately 20% of net sales. Our sales are driven by residential new construction and home repair and remodel end markets, which represented approximately 42% and 58% of our sales, respectively, during 2021. This compares to 46% and 54%, respectively, in 2020. The increase in the percentage of our sales made to the repair and remodel market in 2021 is driven by the additions of the sales of Eco and Anlin in 2021, and NewSouth in 2020, the substantial majority of whose sales are into the home repair and remodel channel.

~~Prior to certain recent acquisitions, we did~~We generally do not supply our products directly to homebuilders, but believe demand for our products is also a function of our strong relationships with certain national homebuilders for both our impact resistant products, and also for our products sold in the ~~west, which are designed to unify indoor-outdoor living spaces.~~west. With the acquisition of NewSouth, we sell direct to the end customer.

Our primary manufacturing materials include aluminum and vinyl extrusions, glass, ionoplast, and polyvinyl butyral. With the acquisition of Martin, steel is an additional primary material used in our manufacturing operations of garage doors. Although in many instances we have agreements with our suppliers, these agreements ~~are generally terminable~~can be terminated by either party on limited notice. While most of our materials are typically available from other sources, transitioning to alternative sources would require us to complete testing and certifications related to impact-resistance and for the alternative source of supply to create the customized equipment and tooling necessary to provide the materials and components to us. Therefore, our goal is to develop and maintain lasting relationships with our material suppliers.

Glass, which includes sheet glass and finished glass, represents a major component of our material purchases, which we sourced from three major national ~~suppliers in 2021, represented approximately 40% of our material purchases during 2021.~~suppliers. Aluminum and vinyl extrusions also accounted for ~~approximately 36%~~significant portions of our material ~~purchases during 2021.~~purchases. Polyvinyl butyral and ionoplast, which are both used as inner layer in laminated glass, ~~typically accounts for approximately 5%~~represents a minor portion of our material purchases. The remainder of our material purchases ~~in 2021~~ are primarily composed of hardware and ~~indirect~~other materials used in the manufacturing process.

Our inventory consists principally of raw materials purchased for the manufacture of our products and limited finished goods inventory as the majority of our products are custom, made-to-order products. Our inventory levels are more closely aligned with our number of product offerings rather than our level of sales. We have maintained our inventory level to have (i) raw materials required to support new product launches; (ii) a sufficient level of safety stock on certain items to ensure an adequate supply of material in the event of a sudden increase in demand and given our short lead-times; and (iii) adequate lead times for raw materials purchased from overseas suppliers in bulk supply.

As discussed below in the section titled ‘Backlog”, at the end of 2021, as compared to the end of 2020, our backlog of sales orders has increased significantly. We define backlog as orders that we have received and have accepted from customers, but that have not yet shipped. The majority of this increase is a result of an increased level of order entry during 2021, but also includes increases relating to the acquisitions. However, during 2021, our backlog increased as a result of growth in orders above our capacity to keep pace with the increased demand. As a result, during 2021, we opened an additional approximately 130,000 square foot manufacturing facility in Fort Myers, Florida to provide additional manufacturing capacity. During the first half of 2020, we also experienced some disruption in our ability to obtain adequate supplies of glass for our manufacturing processes by what we think were the impacts of the COVID-19 pandemic on our glass supply chain partners, which ultimately resulted in an increase in our lead times to our customers. This factor lessened during the second half of 2020 and into 2021, and obtaining adequate supplies of glass has become less of a challenge to our supply chain. We continue to have good relations with our glass supply chain partners, and we have gained additional control over our supply chain for glass with our acquisition of a 75% stake in Eco, whose vertically integrated operations includes a glass manufacturing division which supplies all of the impact-resistant glass used in Eco’s window and door products. We believe that our investment in Eco has provided us with a secure, high-quality, dependable supply of glass for our operations. Prior to our acquisition of Eco, it was historically a significant source of our glass needs and continues to be such today.

Our backlog was ~~$355.9~~$175.3 million as of ~~January 1, 2022,~~December 30, 2023, and ~~$199.5~~$228.8 million as of ~~January 2, 2021.~~December 31, 2022. Our backlog consists of orders that we have received from customers that have not yet shipped. ~~The majority of this increase~~Backlog in ~~backlog resulted from an increased level of order entries during 2021, as well as our acquisitions of Eco and Anlin. For additional discussion of factors affecting our backlog of~~both periods includes orders ~~see the section titled "Materials, Inventory and Supplier Relationships" above.~~

in which revenue has been recognized in accordance with ASC 606. We expect that a significant portion of our ~~current~~ backlog at the end of 2023 will be recognized as sales in the first quarter of ~~2022,~~2024, due in part to our lead times, which typically range from ~~one~~three to five weeks ~~but which have increased as~~for a ~~result~~majority of ~~heightened demand, especially in~~ our ~~Southeast markets, but also due to the previously discussed supply chain disruptions.~~products.

We own and have registered trademarks in the U.S. In addition, we own several patents and patent applications concerning various aspects of window assembly and related processes. We are not aware of any circumstances that would have a material adverse effect on our ability to use our trademarks and patents. If we continue to renew our ~~trademarks~~trade names when necessary, the ~~trademark~~trade-name protection provided by them is perpetual.

Our manufacturing facilities are in Florida, Arizona, California, and ~~California.~~Utah. In Florida, we produce customized impact-resistant and non-impact products. In Arizona, we produce a combination of aluminum and vinyl, , customized non-impact products for the custom channel of our WWS brand, and standard products for its volume channel. In California, we produce vinyl custom non-impact products which, combined with our products manufactured in Arizona, we believe gives us a complete array of aluminum and vinyl, custom and standard window and door products for what we believe is a high-growth western market. In Utah, we produce premium overhead garage doors and hardware, serving the Western United States. In 2023, we began construction on our previously announced Diamond Glass Thin Triple glass fabrication facility in Prince George County, Virginia.

The manufacturing process for our PGT Custom Windows & Doors products typically begins in our glass plant in North Venice, Florida, where we cut, temper, laminate, and insulate sheet glass to meet specific requirements of our customers, and then windows and doors are manufactured in our plants in North Venice, Florida, and our newly opened manufacturing facility in Fort Myers, Florida. Our Hialeah (CGI), and Tampa (NewSouth), Florida facilities and our Phoenix, Arizona (WWS) and Clovis, California (Anlin) facilities primarily source their glass needs from external suppliers. As discussed in the section titled “Materials, Inventory and Supplier Relationships” above, our acquisition of a controlling ownership interest in Eco, which has been one of our glass suppliers before the acquisition, provides us with a high-quality, dependable supply of glass for a portion of our operations in Florida.

Glass is transported to our window and door assembly lines in a make-to-order sequence where it is combined with an aluminum or vinyl frame. These frames are also fabricated to order. We start with a piece of extruded material which is cut and shaped into a frame that fits the customers’ specifications. Once complete, product is immediately staged for delivery and generally shipped on our trucking fleet or with contracted carriers within 48 hours of completion.

With the Martin Acquisition, we added premium overhead garage doors to our product portfolio. Doors are designed and uniquely built to customer specifications using a variety of materials including aluminum extrusion, steel coil, and glass. Fabrication of materials usually starts within 24 hours of a customer order being received, and production usually takes two to three days to complete. Once complete, the door is staged for will-call pick-up or delivery via a third-party contracted delivery method.

The window and door industry is highly fragmented, and the competitive landscape is based on geography. The competition falls into the following categories.

Local and Regional Window and Door Manufacturers: This group of competitors consists of numerous local job shops and small manufacturing facilities that tend to focus on selling products to local or regional dealers and wholesalers. Competitors in this group typically lack marketing support and the service levels and quality controls demanded by larger customers, as well as the ability to offer a full complement of products.

National Window and Door Manufacturers: This group of competitors tends to focus on selling branded products nationally to dealers and wholesalers and has multiple locations.

International Window and Door Manufacturers: This group of competitors consists of non-U.S. companies that have created entities and established manufacturing operations within Florida and have an increasing presence in the South Florida region as suppliers of residential and commercial windows and ~~doors, primarily for high-rise buildings.~~doors.

Active Protection: This group of competitors consists of manufacturers that produce shutters and plywood, both of which are used to actively protect openings. Our impact-resistant windows and doors represent passive protection, meaning, once installed, no activity is required to protect a home from storm related hazards.

The principal methods of competition in the window and door industry are the development of long-term relationships with window and door dealers and distributors, and the retention of customers by delivering a full range of high-quality products in a timely manner, while offering competitive pricing and flexibility in transaction processing. Trade professionals such as contractors, homebuilders, architects and engineers also engage in direct interaction with manufacturers and look to the manufacturer for training and education related to products and codes. We believe our position as one of the leaders in the U.S. impact-resistant window and door market, and the innovative designs and quality of our products, position us well to meet the needs of our customers.

Although our business and facilities are subject to federal, state, and local environmental regulation, environmental regulation does not have a material impact on our operations, and we believe that our facilities are in material compliance with such laws and regulations.

Employees. As of the end of ~~2021,~~2023, we employed approximately ~~5,300~~5,600 people, none of whom were represented by a collective bargaining unit. We believe we have good relations with our employees.

Employee Safety. The safety of our team members is our top priority, and we have taken significant steps in recent years to drive improvements in this area. Some of these safety initiatives we have taken, include:

● Increasing the size, experience and other qualifications of our environment, health and safety, or “E&HS”, staff;

● Adopting an incident management system that records workplace injuries based on type and other classifications to provide the data to drive targeted corrective and preventative actions to address and mitigate actual and potential causes of injuries;

● Implementing ~~a “Serious Six” OSHA compliance training program;~~proactive safety practices such as regular floor leader-led safety inspections of their work areas;

● Implementing ergonomics-related safety improvements, using an experience and risk-based approach to prioritize those improvements;

● Partnering with vendors to obtain high quality personal protective equipment and related training on how to appropriately utilize that equipment;

● Increasing ~~virtual~~ workplace and compliance related safety training ~~in addition to in-person training, when feasible, in response to~~through the ~~COVID-19 pandemic, designed to drive workplace~~use of both virtual and classroom courses as well as on-the-floor safety awareness through all levels of the organization, and taking other actions in response to the COVID-19 pandemic as described in more detail below in “Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations” under the subsection titled “Impact of COVID-19 on our

Business”;discussions;

● Training team members to identify, report and quickly address potentially unsafe activities and practices;

● ~~Implementing a~~Utilizing train the trainer programs to develop internal team ~~member EH&S recognition~~members as trainers for safety compliance items such as Forklift operation and ~~rewards program;~~LOTO Authorized; and

● Increasing the frequency, number and types of internal workplace safety audits, inspections and walk-throughs conducted by the Company’s EH&S staff.

Labor Practices and Human Rights. All of our employees earn more than the federal minimum wage and we believe our hourly wages are competitive with the local communities in which our facilities operate. The average hourly wage, excluding incentive compensation, of a full-time hourly employee of the Company was approximately $17.74 as of January 1, 2022, as compared to $16.26 as of January 2, 2021, with approximately one-half of those hourly employees earning an average hourly wage of $16.50 or more. The average total compensation, including incentive compensation and benefits, for a full-time hourly employee of our Company in 2021 was $43,500.

We strive to help our employees maintain job stability, so they are encouraged to stay with the Company and positioned to grow their skills and knowledge on the job. The ~~2021~~2023 annualized voluntary turnover rate in our workforce ~~generally was flat~~decreased slightly as compared to ~~2020.~~2022. In an effort to reduce employee turnover, we engage in annual surveys with employees, we maintain an open-door policy that enables us to help identify any issues before they cause an employee to leave the Company, and we review exit interview data, hotline calls and root cause analysis to help deter turnover. We also assign dedicated Company human resources representatives to each department so that we can better monitor employee morale within each department.

Workforce Diversity and Inclusion. We believe in being an inclusive workplace for all of our employees and are committed to having a diverse workforce that is representative of the communities in which we operate and sell our products. A variety of perspectives enriches our culture, leads to innovative solutions for our business and enables us to better meet the needs of a diverse customer base and reflects the communities we serve. Our aim is to develop inclusive leaders and an inclusive culture, while also recruiting, developing, mentoring, training, and retaining a diverse workforce, including a diverse group of management-level employees.

● PGT Innovations Leading Ladies, a program designed to identify, develop and mentor female employees who have demonstrated potential for serving as leaders within our organization;

● Dale Carnegie, a program that helps our managers understand how to appreciate, respect and value individual differences and behaviors.

Benefits and Well-Being. We believe in offering career opportunities, resources, programs, and tools to help employees grow and develop, as well as competitive wages and benefits to retain them. Our efforts in these areas include:

● Offering platforms, including on-line and in-person professional growth and development training, to help employees develop their skills and grow their careers at the Company;

● Providing management development training to all of our management-level employees, including compliance, ethics and leadership training;

● Providing employees with recurring training on critical issues such as safety and security, compliance, ethics and integrity and information security;

● Gathering engagement feedback from our employees on a regular basis and responding to that feedback in a variety of ways including personal, one-on-one interactions, team meetings, leadership communications, and town hall meetings with employees, led by senior executives;

● Offering a tuition reimbursement program that provides eligible employees up to $50,000 lifetime for courses related to current or future roles at the Company;

● Offering health benefits for all eligible employees, including our eligible hourly employees;

● Providing confidential counseling for employees through our Employee Assistance Program;

● Matching employees’ 401(k) plan contributions of up to 3% of eligible pay after 3 months of service;

● Providing a Company-subsidized childcare center for the employees of our Venice, Florida facility, which is our largest location.

Our Internet address is www.pgtinnovations.com. Through our Internet website under “Financial Information” in the Investors section, we make available free of charge, as soon as reasonably practical after such information has been filed with the SEC, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed pursuant to Section 13(a) or 15(d) of the Securities Exchange Act. Also available through our Internet website under “Corporate Governance” in the Investors section is our Code of Business Conduct and Ethics. We are not including this or any other information on our website as a part of, nor incorporating it by reference into this, or any of our other SEC filings. The SEC maintains an Internet site that contains our reports, proxy and information statements, and other information that we file electronically with the SEC at www.sec.gov.

Moreover, other factors may adversely affect our results of operations, including potential liability under environmental and other laws and other unforeseen events, many of which are discussed elsewhere in the following risk factors. Any or all of these factors could materially adversely affect our results of operations.

Risks Related to the ~~COVID-19 pandemic~~Agreement and Plan of Merger We Have Entered Int

The ~~ongoing COVID-19 pandemic has~~announcement and pendency of our agreement to be acquired could have an adverse effect on our business.

On January 16, 2024, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with MIWD Holding Company LLC, a Delaware limited liability company (“MITER”), and RMR MergeCo, Inc., a Delaware corporation and an indirect wholly-owned subsidiary of MITER (“Merger Sub”). Upon the terms and subject to the conditions set forth in the Merger Agreement, Merger Sub will merge with and into us (the “Merger”), with us surviving as a wholly owned indirect subsidiary of MITER. Pursuant to the Merger Agreement, at the effective time of the Merger, each issued and outstanding share of our common stock, par value $0.01 per share (each, a “PGTI Common Share”) (other than any PGTI Common Shares that are held by us as treasury stock or held by MITER, Merger Sub or any other subsidiary of MITER or us or any PGTI Common Shares as to which appraisal rights have been properly exercised in accordance with Delaware law), will automatically be canceled and retired and converted into the right to receive $42.00 per share in cash, without interest.

On December 17, 2023, we had previously entered into an Agreement and Plan of Merger with Masonite International Corporation, a British Columbia corporation (“Masonite”), and Peach Acquisition, Inc., a Delaware corporation and an indirect wholly-owned subsidiary of Masonite, which agreement was subsequently terminated on January 16, 2024.

Uncertainty about the effect of the proposed Merger on our employees, suppliers, customers and business partners may have an adverse effect on our business and operations that may be material to our company. Our employees may experience uncertainty about their roles following the Merger. There is ~~expected~~no assurance we will be able to attract and retain key talent, including senior leaders, to the same extent that we have previously been able to attract and retain employees. Any loss or distraction of such employees could have a material adverse effect on our business and operations. In addition, we have diverted, and will continue to ~~have,~~divert, significant management resources towards the completion of the Merger, which could materially adversely affect our business and operations.

While the proposed Merger is pending, our suppliers, customers or business partners may delay or defer certain business decisions with respect to us, or seek to change or renegotiate their relationships with us as a result of the Merger. Such parties may also experience uncertainty associated with the Merger that may affect current or future business relationships with us. Uncertainty may cause such parties to be more cautious in their arrangements with us, and such parties may seek to change existing business relationships. During this period, we may also face challenges in accessing debt or equity markets on favorable terms, or at all, including due to restrictions on our ability to incur debt contained in the Merger Agreement. Any such effects could result in an adverse effect on our business, operations and financial condition in a way that may be material to our company, regardless of whether the Merger is completed.

Pursuant to the terms of the Merger Agreement, we are subject to certain restrictions on the conduct of our business, including the ability in certain cases to enter into contracts, acquire or dispose of assets, enter into new lines of business, incur indebtedness or incur capital expenditures, until the Merger becomes effective or the Merger Agreement is terminated. These restrictions may prevent us from taking actions with respect to our business that we may consider advantageous and result in our inability to respond effectively to competitive pressures and industry developments, and may otherwise harm our business and operations.

The failure to complete the Merger could adversely affect our business and financial condition.

Completion of the Merger is subject to several conditions beyond our control that may prevent, delay or otherwise adversely affect its completion in a material way, including the approval of our stockholders and the termination of the waiting period related to the Merger under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. In addition, either we or MITER may terminate the Merger Agreement under certain circumstances, including if the Merger is not completed by the end date determined pursuant to the Merger Agreement. A special meeting of our stockholders is scheduled for Monday, March 18, 2024 at 10:30 A.M eastern time, to consider the Merger. Our board of directors has unanimously (i) determined that the Merger Agreement and the transactions contemplated thereby are fair to and in the best interests of us and our stockholders, (ii) declared it advisable to enter into the Merger Agreement and consummate the transactions contemplated thereby upon the terms and subject to the conditions set forth therein, (iii) approved the execution and delivery of the Merger Agreement by us, the performance by us of our covenants and other obligations thereunder and the consummation of the transactions contemplated thereby upon the terms and conditions set forth therein, (iv) resolved to recommend that our stockholders vote to adopt the Merger Agreement in accordance with the Delaware General Corporation Law and (v) directed that the adoption of the Merger Agreement be submitted for consideration by our stockholders at a meeting thereof.

If the Merger or a similar transaction is not completed, the share price of our common stock may drop to the extent that the current market price of our common stock reflects an assumption that such a transaction will be completed. In addition, under circumstances specified in the Merger Agreement, we may be required to pay a termination fee of $86 million in the event the Merger is not consummated. Further, a failure to complete the Merger may result in negative publicity and a negative impression of us in the investment community. Any disruption to our business resulting from the announcement and pendency of the Merger and from intensifying competition from our competitors, including any adverse changes in our relationships with our employees, suppliers, customers and business partners, could continue or accelerate in the event of a failure to complete the Merger. In addition, even if we fail to complete the Merger, we will still incur certain significant costs associated with the Merger, primarily consisting of legal fees, accounting fees, financial advisory, financial printing and other related costs. There can be no assurance that our business, key relationships or financial condition will not be adversely affected, as compared to the condition prior to the announcement of the Merger, if the Merger is not consummated.

The Merger Agreement contains provisions that limit our ability to pursue alternatives to the Merger and could discourage a potential competing transaction counterparty from making a favorable alternative transaction proposal to us.

The Merger Agreement contains provisions that make it more difficult for us to be acquired by, or enter into certain combination transactions with, a third party. The Merger Agreement contains certain provisions that restrict our ability to, among other ~~risks,~~things, solicit, initiate or take any action to knowingly induce the making, submission or announcement of, or knowingly facilitate or encourage the submission of an alternative transaction, or participate or engage in any discussions or negotiations, or cooperate with any person, with respect to an alternative transaction. In addition, following our receipt of any alternative transaction proposal that constitutes a Superior Proposal (as defined in the Merger Agreement), MITER would have an opportunity to offer to modify the terms of the Merger Agreement before our board may withhold, qualify or modify in a manner adverse ~~effect~~to MITER its recommendation with respect to the Merger and before we may terminate the Merger Agreement. If the Merger Agreement is terminated by us to enter into a Superior Proposal or by MITER if our board withholds, qualifies. modifies in a manner adverse to MITER its recommendation with respect to the Merger or takes certain similar actions, we would be required to pay a termination fee of $86 million to MITER, as contemplated by the Merger Agreement.

These provisions could discourage a potential third-party acquirer or merger partner that might have an interest in acquiring or combining with all or a significant portion of us or pursuing an alternative transaction from considering or proposing such a transaction.

We have received certain shareholder demand letters, and we may become the target of lawsuits or derivative lawsuits that could result in substantial costs and may delay or prevent the Merger Agreement from being consummated. Defending against such claims could result in substantial costs and divert management time and resources, even if the lawsuits are without merit. An adverse judgment could result in monetary damages, which could have a negative impact on our business, results of operations and financial condition.

~~During March 2020,~~ Additionally, if a ~~global pandemic (the “Pandemic”) was declared by the World Health Organization related to the rapidly growing outbreak of a novel strain of coronavirus (“COVID-19”). The Pandemic has resulted~~plaintiff is successful in a significant number of infections, hospitalizations and deaths in several of our key markets, including Arizona, California, Florida and Texas. The Pandemic has significantly affected economic conditions in those markets, and in the United States in general, and internationally, including due to federal, state and local governments and employers reacting to the public health crisis with mitigation measures, and also due to the general fear and uncertainty created by the Pandemic, all of which has resulted in workforce, supply chain and production disruptions, along with reduced demand and spending in many industries and markets. Although manyobtaining an injunction prohibiting consummation of the ~~government-mandated restrictions on economic and social activities that were put in place as part of~~Merger Agreement, the ~~initial response to~~injunction may delay or prevent the Pandemic have been lifted, and vaccines with high degrees of efficacy have been approved by the United States Food and Drug Administration, it is still uncertain when or if the nation-wide program of vaccination will result in herd immunity to COVID-19 in the United States or globally. This uncertainty isMerger from being impacted by several factors, including vaccine hesitancy or resistance, and the emergence of the highly-contagious strains of COVID-19 known as the Delta and Omicron variants. As a result, it is still currently unclear when, or if, social, business, occupational, educational and economic conditions will return to pre-Pandemic conditions.

~~The extent to~~completed, which ~~the continuing circumstances around the Pandemic could~~may adversely affect our future business, operations and financial results will depend upon numerous evolving factors that we are not able to accurately predict, including the timing of any relief that may come from the current program of nationwide vaccinations and its effect on the duration of the continuing economic and market disruptions related to the Pandemic, and whether such vaccines are effective against any current and new variants of coronavirus, and the nature, amounts and duration of any additional government stimulus measures designed to bolster the economy. As such, we continue to be unable to accurately predict the impact the Pandemic and the challenges it has created for the U.S. and global economies, will have on our financial performance and operations going forward due to numerous uncertainties, including the severity of the disease, the duration of the outbreak, when or if herd immunity is achieved in the United States, especially in our key markets, actions that may be taken by governmental authorities to attempt to control the Pandemic, the impact to our customers’ and suppliers’

businesses and other factors identified below. We will continue to evaluate the nature and extent of the impact of the Pandemic to our business, consolidated results of operations, and financial condition. Such other detrimental impacts that we could experience might include the following:

If any one or more of those impacts are sustained, they could have accounting consequences such as impairments of the goodwill and/or additional impairments of trade names of our reporting units and could seriously disrupt our operations and sales for extended periods. The adverse effect on our business, financial condition or results of operations of any of the matters described above could be material.

~~The extent of the impact of the Pandemic on~~ our business, results of operations and financial ~~condition, including any goodwill~~condition. No assurances can be given that lawsuits or ~~additional trade name impairment~~ derivative lawsuits will not be filed that may make claims, such as breach of fiduciary duties by our officers and/or ~~other asset impairments~~directors, which would subject us to our business segments as described in this Report, will depend largely on future developments, including the severity and duration of the outbreak in the U.S., whether there are additional or other meaningful increases in the number, variants or severity of COVID-19 cases in future periods, and the related impact on consumer confidence and spending and on our customers, suppliers and labor force, all of which are highly uncertain and cannot be predicted.such risks.

We depend on hiring an adequate number of hourly employees to operate our business and are subject to government regulations concerning these and our other employees, including wage and hour regulations, and we may be required to increase the wages we pay in order to attract, hire and retain hourly employees needed to manufacture our products and otherwise conduct our operations, and we may not be able to recover that increase in labor costs through increasing the prices we charge for our products or otherwise.

Our workforce is comprised primarily of employees who work on an hourly basis. To grow our operations and meet the needs and expectations of our customers, we must attract, train, and retain a large number of hourly associates, while at the same time controlling labor costs. These positions have historically had high turnover rates, which can lead to increased training, retention and other costs. In certain areas where we operate, there is significant competition for employees. The lack of availability of an adequate number of hourly employees, or our inability to attract and retain them, ~~including due to government stimulus payments or enhanced unemployment benefits enacted in response to the Pandemic,~~ or us having to increase wages paid to new and/or to current employees to attract, hire and/or retain the labor resources necessary to conduct our operations, could adversely affect our business, results of operations, cash flows and financial condition. We are subject to applicable rules and regulations relating to our relationship with our

employees, including wage and hour regulations, health benefits, unemployment and payroll taxes, overtime and working conditions and immigration status. Accordingly, federal, state or locally legislated increases in the minimum wage, such as the passage of Florida’s “Amendment 2” minimum wage law in November 2020, as well as increases in additional labor cost components such as employee benefit costs, workers’ compensation insurance rates, compliance costs and fines, would increase our labor costs, which could have a material adverse effect on our business, prospects, results of operations and financial condition.

A material portion of our business currently is geographically concentrated in Florida and that concentration increased with our acquisition of NewSouth and Eco.

Many of our manufacturing facilities, except for our Arizona, California and Utah facilities, are located in Florida, where the substantial portion of our sales are made. We believe that focusing operations into manufacturing locations in Florida optimized manufacturing efficiencies and logistics, and we believe that a focused approach to growing our market share within our core wind-borne debris markets in Florida, from the Gulf Coast to the mid-Atlantic, and certain international markets, will maximize value and return. Our acquisitions of NewSouth and Eco increased our manufacturing and sales concentration in Florida. Our manufacturing facilities in Arizona, California and Utah and the markets served by those businesses in the Western United States may not provide adequate geographic diversification for our business, as we expect that the primary concentration of our business will continue to be in Florida, and another prolonged decline in the economy of the state of Florida or of certain coastal regions, a change in state and local building code requirements for hurricane protection, or any other adverse condition in the state or certain coastal regions, could cause a decline in the demand for our products, which could have an adverse impact on our sales and results of operations.

We are subject to fluctuations in the prices of our raw materials which could have an adverse effect on our results of operations.

We experience significant fluctuations in the cost of our raw materials, including glass, aluminum extrusion, vinyl extrusion, and polyvinyl butyral. WeIn the past, we have experienced inflationary conditions, which increased our costs of raw materials. In an attempt to offset these rising costs, we took action to increase prices and, as such, were largely successful in passing these increased costs onto our customers. However, we anticipate that these fluctuations will continue in the future. A variety of factors over which we have no control, including global demand for aluminum, fluctuations in oil prices, speculation in commodities futures, tariffs and the creation of new laminates or other products based on new technologies impact the cost of raw materials that we purchase for the manufacture of our products. These factors may also magnify the impact of economic cycles on our business. Although we endeavor from time to time to hedge the risks of fluctuations in the prices of our raw materials, or pass rising costs onto our customers by increasing the prices of our products, we cannot guarantee that we will always be able to successfully minimize our risk through such actions.

We rely on a limited number of outside suppliers for certain key components and materials.

We obtain a significant portion of our key raw materials, such as glass, aluminum and vinyl extrusion components, from a few key suppliers, and obtain the polyvinyl butyral interlayers used in certain of our products from a sole supplier. If any of these suppliers is unable to meet its obligations under present or any future supply agreements, or if those supply agreements are terminated, we may not be able to obtain certain raw materials on commercially reasonable terms, or at all, and may suffer a significant interruption in our ability to manufacture our products, including because it may be difficult to find substitute or alternate suppliers as the glass, interlayers and aluminum and vinyl extrusions we use are customized. A supplier may also choose, subject to existing contracts, to modify its relationship due to general economic concerns or concerns relating to the supplier or us, at any time. These modifications could include requirements from our suppliers that we provide them additional security in the form of prepayments or letters of credit.

In addition, while our business does not currently rely heavily on international suppliers or sales, significant disruptions in global economic conditions, travel or trade, including as a result of contagious disease events, such as ~~the Pandemic,~~a global pandemic, may have material adverse impacts on our supply chain. 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, which may impact our ability to fulfil orders or increase our costs.

Any interruption of supply or any price increase of raw materials could have a material adverse effect on our business and results of operations. If we are required to obtain an alternate source for these materials or components, we may not be able to obtain pricing on as favorable terms or on terms comparable to our competitors. Additionally, we may be forced to pay additional transportation costs or to invest in capital projects or costly product redesigns and perform costly new product certification testing with respect to our impact-resistant products, in connection with moving to any alternate source of supply.

We could experience a delay between the increased cost to us to obtain these raw materials, and our ability to increase the price of our products. If we are unable to pass on significant cost increases to our customers, our results of operations between periods may be negatively impacted. Any significant change in the terms that we have with our key suppliers or any interruption of supply or any price increase of raw materials could materially adversely affect our financial condition and liquidity.

Economic and credit market conditions impact our ability to collect receivables.

Economic and credit conditions can negatively impact our bad debt expense, which can adversely impact our results of operations. Some of the markets we serve, which includes dealers whose customers are second and vacation home owners in the repair and remodeling sector, are more sensitive to changes in economic and credit conditions. If economic and credit conditions deteriorate, we may experience difficulties collecting on our accounts receivable, increasing our days sales outstanding and base debts owed to us, which could adversely impact our results of operations and business.

The industry in which we compete is highly competitive and we have experienced increased competition in our core market of Florida.

The window and door industry is highly competitive. We face significant competition from numerous small, regional producers, as well as certain national producers. Furthermore, the impact-resistant window and door market in our primary market of Florida has recently attracted domestic and foreign competitors. 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 or compete more aggressively in pricing, or (iv) adapt more quickly to new technologies or evolving customer requirements

than do we. Additionally, some of the competitors of our businesses are larger and have greater financial and other resources and less debt than us. Accordingly, these competitors may be better able to withstand changes in conditions within the industries and markets in which we operate and may have significantly greater operating and financial flexibility than we have. Moreover, barriers to entry are low in most product lines and new competitors may enter our industry, especially if the market for impact-resistant windows and doors continues to expand. An increase in competition, including in the form of aggressive pricing by new market entrants and offerings of alternative building materials, could cause us to lose customers and lead to decreases in net sales and profitability if we are not able to respond adequately to such challenges. To the extent we lose customers in the renovation and remodeling markets, we would likely have to market more to the new home construction market, which historically has experienced more significant fluctuations in demand.

We operate our own fleet of trucks, which we reply on to a great extent for distribution of our products. But we also rely, and expect to continue to rely on third-party transportation, which subjects us to risks and costs that we cannot control, and which risks and costs may materially adversely affect our profitability.

Although we operate a fleet of trucks which we rely on to a great extent for the distribution of our products, we also rely, and expect to continue to rely on third party trucking companies to transport raw materials to the manufacturing facilities used by each of our businesses and to ship finished products to customers. These transport operations are subject to various hazards and risks,

including extreme weather conditions, work stoppages and operating hazards, as well as interstate transportation regulations. In addition, the methods of transportation we utilize may be subject to additional, more stringent and more costly regulations in the future. If we are delayed or unable to ship finished products or unable to obtain raw materials as a result of any such new regulations or public policy changes related to transportation safety, or these transportation companies fail to operate properly, or if there were significant changes in the cost of these services due to new or additional regulations, or otherwise, we may not be able to arrange efficient alternatives and timely means to obtain raw materials or ship goods, which could result in a material adverse effect on our revenues and costs of operations. Transportation costs represent a significant part of our cost structure. If our transportation costs increased substantially, due to prolonged increases in fuel prices or otherwise, we may not be able to control them or pass the increased costs onto customers, which may materially adversely affect our profitability.

Sales fluctuations to and changes in our relationships with key customers could have a material adverse effect on our financial condition, liquidity or results of operations.

Some of our business lines and markets are dependent on a few key customers, including dealers. We generally do not enter into written or long-term agreements with our customers. The loss, reduction, or fluctuation of sales to one of these major customers, or any adverse change in our business relationship with any one or more of them, could have a material adverse effect on our financial condition, liquidity or results of operations.

Some of our key customers are companies that have experienced and may continue to experience consolidation in their ownership or expand through internal growth. Consolidation could decrease the number of potential customers for our products and increase our reliance on key customers. Further, any increase in the ownership concentration or size of our key customers could result in our key customers seeking more favorable terms, including pricing, for the products that they purchase from us. Accordingly, any increase in ownership concentration of our key customers or other increases in the size of our customers may further limit our ability to maintain or raise prices in the future. This could have a material adverse effect on our business, financial condition and results of operations.

We are subject to the credit risk of our customers, suppliers, and other counterparties.

We are subject to the credit risk of our customers, because we provide credit to our customers in the normal course of business. All of our customers are sensitive to economic changes and to the cyclical nature of the building industry. Especially during protracted or severe economic declines and cyclical downturns in the building industry, our customers may be unable to perform on their payment obligations, including their debts to us. Any failure by our customers to meet their obligations to us may have a material adverse effect on our business, financial condition, and results of operations. In addition, we may incur increased expenses related to collections in the future if we find it necessary to take legal action to enforce the contractual obligations of a significant number of our customers.

We conduct all of our operations through our subsidiaries and rely on payments from our subsidiaries to meet all of our obligations.

We are a holding company and derive all of our operating income from our subsidiary, PGT Industries, Inc., and its subsidiaries, CGI, WinDoor, WWS Acquisition, LLC, doing business as Western Window Systems, as well as from the entities acquired in the NewSouth Window Solutions acquisition, our 75% stake in New Holding and its related ECO entities, and the entities acquired in the Anlin Acquisition.subsidiaries. All of our assets are held by our subsidiaries, and we rely on the earnings and cash flows of our subsidiaries to meet our obligations. The ability of our subsidiaries to make payments to us will depend on their respective operating

results and may be restricted by, among other things, the laws of their jurisdictions 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 subsidiaries, including our credit facilities and indenture, and the covenants of any future outstanding indebtedness we or our subsidiaries incur.

We are subject to regional and national economic conditions that may negatively impact demand for our products.

The window and door industry is subject to many economic factors. Changes in macroeconomic conditions in our core markets including Florida, with respect to our impact-resistant products, and in the western U.S., including California, Texas, Arizona, Nevada, Colorado, Oregon, Washington and Hawaii, with respect to our WWS products designed to unify indoor and outdoor living spaces, as well as throughout the U.S. generally, could negatively impact demand for our products and macroeconomic forces, such as employment rates and the availability of credit could have an adverse effect on our sales and results of operations. In addition, the window and door industry is subject to the cyclical market pressures of the larger new construction and repair and remodeling markets. A decline in the economic environment or new home construction, as well as any other adverse changes in economic conditions, including demographic trends, employment levels, interest rates, and consumer confidence, could result in a decline in demand for, or adversely affect the pricing of, our products, which in turn could adversely affect our sales and results of operations.

Changes in weather patterns, including as a result of global climate change, could significantly affect demand for our products, and thus, our sales and our financial results or financial condition.

Weather patterns may affect our operating results and our ability to maintain our sales volume throughout the year. Because our ~~dealers’~~ customers ~~and the homeowners and builders who are customers of NewSouth Window Solutions and Western Window Systems, along with the customers of Eco’s dealers,~~ depend on suitable weather to engage in new construction and repair and remodel projects, increased frequency or duration of extreme weather conditions could result in a decrease in the demand for our products for periods of inclement weather, and have a material adverse effect on our financial results or financial condition. For example, unseasonably cool weather or extraordinary amounts of rainfall may decrease construction activity, thereby decreasing demand for our products and our sales during that period of time. Alternatively, extreme weather, such as hurricanes, has historically increased the visibility of our brands and customers’ demand for our impact-resistant products. Therefore, the lack of hurricane-related extreme weather conditions in a given year or over a period of time could result in a decrease of our sales and could have a material adverse effect on our financial results. Weather patterns are difficult to predict and may fluctuate as a result of numerous factors, including climate change, and we cannot guarantee that extreme weather conditions will or will not occur. Also, we cannot predict the effects that global climate change may have on our business. In addition to changes in weather patterns, climate change could, for example, reduce the demand for construction, and increase the cost and reduce the availability of construction materials, raw materials and energy. New laws and regulations related to global climate change may also increase our expenses or reduce our sales.

Our operating results are substantially dependent on demand for our branded impact-resistant products, contemporary indoor/outdoor window and door systems and factory-direct, energy-efficient residential windows and doors.

A majority of our net sales are derived from the sales of our branded impact-resistant products and on window and door systems for residential, commercial and multi-family markets. Accordingly, our future operating results will depend largely on the demand for our impact-resistant products by current and future customers, especially in the State of Florida, where the majority of our impact resistant products are made and sold. Our future operating results also will depend on demand for the contemporary indoor/outdoor window and door systems sold by our Western Window Systems business. Sales generated by our NewSouth business depend on a direct-to-consumer model and is supported by showrooms and in-home sales. Consequently, a portion of our future operating results are reliant on current and future customer demand for factory-direct, energy-efficient residential windows and doors. If our competitors release new products that are superior to our products in performance or price, or if we fail to update our impact-resistant 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. In addition, the window and door industry can be subject to changing trends and consumer preferences. If we do not correctly gauge consumer trends for the various products and systems we offer and respond appropriately, customers may not purchase our products and our brand names may be impaired. Even if we react appropriately to changes in trends and consumer preferences, consumers may consider our brands or product designs to be outdated or associate our brands or product designs with styles that are no longer popular. Any of these outcomes could create significant excess inventories for some products and missed opportunities for other products, which would have a material adverse effect on our brands, our business, results of operations and financial condition. A decline in demand for our impact-resistant products, our contemporary indoor/outdoor window and door systems or our direct-to-consumer, energy-efficient residential windows and doors as a result of competition, technological change, changes in consumer preferences or other factors could have a material adverse effect on our ability to generate sales, which could materially negatively affect our results of operations.

Our business is subject to seasonal industry patterns and demand for our products, and thus our revenue and profit, can vary significantly throughout the year, which may adversely impact the timing of our cash flows and limit our liquidity at certain times of the year.

Our business is seasonal, and our net revenues and operating results vary significantly from quarter to quarter based upon the timing of the building season in our markets. Our sales typically follow seasonal new construction and the repair and remodel industry patterns. Additionally, events like preparation for hurricane season and rebuilding and repairs in the months following a hurricane in the majority of the geographies where we market and sell our products generally creates peak demand for our products and resulting sale volumes during the quarters in which those activities occur. Other quarterly sales volumes might be generally lower due to reduced repair and remodeling and new construction activity as a result of less favorable climate conditions in the majority of our geographic end markets. Failure to effectively manage our demand and production planning, inventory and overall operations in anticipation of or in response to seasonal fluctuations or changing seasonal fluctuations as a result of climate change, could negatively impact our liquidity profile during certain seasonal periods.

Changes in building codes could reduce the demand for our impact-resistant windows and doors, which could have a material adverse effect on our financial condition, liquidity or results of operations.

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 become more stringent, 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 because of industry lobbying or otherwise, demand for our impact-resistant products may

decrease. In addition, if states and regions that are affected by hurricanes but do not 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. We are also subject to energy efficiency codes and performance standards in Colorado, California and other states where we operate, several of which are more stringent than those to which we have historically been subject. Any such changes in building codes or energy efficiency codes could lower the demand for our impact-resistant windows and doors, which could have a material adverse effect on our financial condition, liquidity or results of operations.

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.

We may be adversely impacted by the loss of sales or market share if we are unable to keep up with demand.

We are currently experiencing growth through higher sales volume and growth in market share. To meet the increased demand, we have been hiring and training new employees for direct and indirect support and adding to our glass capacity. However, should we be unable to find and retain quality employees to meet demand, or should there be disruptions to the increase in capacity for the raw materials needed to produce our products, we may be unable to keep up with our higher sales demand. If our lag time on delivery falls behind, or we are unable to meet customer timing demands, we could lose market share to competitors.

Our recently completed acquisitions may result in, or involve activities that cause, distractions to our management team, increased expenses or unanticipated liabilities.

As a result of our acquisitions of NewSouth, ~~Western Windows Systems, 75% ownership stake in~~ Eco, CRi SoCal, Inc., Anlin, and ~~Anlin,~~Martin, we have significantly more sales, assets and employees than we did prior to the transactions, which may require our management to devote a significant amount of time, resources and attention to the new product offerings or novel challenges, and/or away from the operations of our historical windows and doors business. These potential diversions and distractions may result in, or involve activities that cause, increased expenses and unanticipated liabilities.

After the Eco Acquisition, the Company is the majority shareholder of Eco, and our interest in Eco is subject to the risks normally associated with the conduct of businesses with a minority shareholder.

Pursuant to the acquisition agreement pursuant to which we acquired a 75% ownership stake in Eco, principal Eco equity-holder prior to our acquisition continues to hold 25% of the outstanding equity interests of Eco. Conducting a business with a minority investor may lead to one or more of the following circumstances, which could have an adverse impact on our ability to realize a profit on our equity interest in the Eco businesses, which could have a material adverse impact on our future cash flows, earnings, results of operations and financial condition:

~~There can be no assurance that the Eco Acquisition will be beneficial to us, whether due to the above-described risks, unfavorable economic conditions, integration challenges or other factors.~~

All of the Eco entities in which we acquired a controlling interest are designated as unrestricted subsidiaries under our existing senior secured credit facilities and indenture and are not subject to the restrictive covenants under such agreements.

All of the Eco entities in which we acquired a controlling interest have been designated as unrestricted subsidiaries under our existing senior secured credit facilities and indenture. As a result, those entities are not subject to the restrictive covenants in the indenture and are able to engage in many of the activities that we and our restricted subsidiaries are prohibited or limited from undertaking under the terms of the indenture. These actions, if undertaken by Eco, could be detrimental to our ability to make payments of principal and interest under the 2021 Senior Notes due 2029.

If we do not realize the expected benefits from our recent acquisitions, including synergies, from acquisitions, our business and results of operations will suffer.

Acquisitions may cause an interruption of, or loss of momentum in, the activities of our other businesses. If our management is not able to effectively manage the integration process, or if any significant business activities are interrupted as a result of the integration process, our business could suffer and its liquidity, results of operations and financial condition may be materially adversely impacted. In addition, as we continue our integration activities, we may identify additional risks and uncertainties not yet known to us.

Even if we are able to successfully integrate and position the business operations of our recent acquisitions and our legacy businesses, it may not be possible to realize the full benefits of the increased sales volume and other benefits, including synergies, that we expected to result from recent acquisitions, or realize these benefits within the time frame that is expected. For example, the elimination of duplicative costs may not be possible or may take longer than anticipated, or the benefits from these recent acquisitions may be offset by costs incurred or delays in integrating the companies. In addition, even if such acquisitions are successfully integrated, we may become subject to unexpected costs, charges or liabilities arising from such businesses. Our expected cost savings, as well as any revenue or other strategic synergies, are subject to significant business, economic, regulatory and competitive uncertainties and contingencies, all of which are difficult to predict and many of which are beyond our control. If we fail to realize the benefits, we anticipated from our recent acquisitions, our liquidity, results of operations or financial condition may be adversely effected.

We may evaluate and engage in asset acquisitions, dispositions, joint ventures and other transactions that may impact our results of operations, and we may not achieve the expected results from these transactions.

From time to time, and subject to the agreements governing our then existing debt or otherwise, we may enter into agreements to and engage in business combinations, purchases of assets or contractual arrangements or joint ventures, including in geographical areas outside the state of Florida, with which we do not have the level of familiarity that we have with the Florida market. In addition, some of those business acquisitions or combinations could involve a seller whose products may be different from the types of products we currently sell, and they could be products that are sold to different types of customers. Subject to the agreements governing our then existing debt or otherwise, some of these transactions may be financed with additional borrowings. The integration of any business we may acquire may be disruptive to us and may result in a significant diversion of management attention and operational resources. Additionally, we may suffer a loss of key employees, customers or suppliers, loss of revenues, increases in costs or other difficulties. If the expected revenue enhancement plans, strategies, goals, efficiencies and synergies from any such transactions are not fully realized, our results of operations could be adversely affected, because of the costs associated with such transactions or otherwise. Other transactions may advance future cash flows from some of our businesses, thereby yielding increased short-term liquidity, but consequently resulting in lower cash flows from these operations over the longer term. In addition, if the goodwill, indefinite-lived intangible assets, or other intangible assets that we have acquired or may acquire in the future are determined to be impaired, we may be required to record a non-cash charge to earnings during the period in which the impairment is determined, which

could be significant. The failure to realize the expected long-term benefits of any one or more of these transactions could have a material adverse effect on our financial condition or results of operations.

Our substantial level of indebtedness could adversely affect our business and financial condition and prevent us from meeting our debt obligations.

Our total gross indebtedness is ~~$635.0~~$620.0 million, including $575.0 million aggregate principal amount of senior notes we issued on September 24, 2021, and $45.0 million under our $250.0 million revolving credit facility entered into in October 2022 (the "Revolving Credit Facility"), under which we had ~~an additional $74.7~~$196.5 million available for borrowing ~~under our senior secured credit facilities.~~at December 30, 2023.

Although our senior secured credit facilities and indenture contain restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of significant qualifications and exceptions, and under certain circumstances, the amount of indebtedness that could be incurred in compliance with these restrictions could be substantial.

Our ability to make scheduled payments on or to refinance our debt obligations depends on our financial condition and operating performance, which is subject to prevailing economic and competitive conditions and to certain financial, business, and other factors beyond our control. We may not be able to maintain a level of cash flows from operating activities sufficient to permit us

to pay the principal, premium, if any, and interest on our indebtedness. If our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay investments and capital expenditures, or to sell assets, seek additional capital, or restructure or refinance our indebtedness. Our ability to restructure or refinance our debt will depend on the condition of the capital markets and our financial condition at such time. Any refinancing of our debt could be at higher interest rates and may require us to comply with more onerous covenants, which could further restrict our business operations. The terms of existing or future debt instruments, including the senior secured credit facilities and the indentures governing our outstanding notes, may restrict us from adopting some of these alternatives. In addition, any failure to make payments of interest and principal on our outstanding indebtedness on a timely basis would likely result in a reduction of our credit rating, which could harm our ability to incur additional indebtedness. These alternative measures may not be successful and may not permit us to meet our scheduled debt service obligations.

Our debt agreements contain restrictions that limit our flexibility in operating our business.

Our senior secured credit facilities and the indenture governing the senior notes contain various covenants that limit our ability to engage in specified types of transactions. These covenants limit our ability to, among other things:

• pay dividends on, repurchase, or make distributions in respect of our common stock, prepay, redeem, or repurchase certain debt or make other restricted payments;

• enter into agreements restricting our subsidiaries’ ability to pay dividends to us;

• consolidate, merge, sell, or otherwise dispose of all or substantially all of our assets; and

In addition, the restrictive covenants in our senior secured credit facilities require us to maintain specified financial ratios and satisfy other financial condition tests. Our ability to meet those financial ratios and tests will depend on our ongoing financial and operating performance, which, in turn, will be subject to economic conditions and to financial, market, and competitive factors, many of which are beyond our control.

A breach of any of these covenants could result in a default under one or more of these agreements, including as a result of cross default provisions and, in the case of the senior secured credit facilities, permit the lenders to cease making loans to us. Upon the occurrence of an event of default under the senior secured credit facilities, the lenders could elect to declare all amounts outstanding under senior secured credit facilities to be immediately due and payable and terminate all commitments to extend further credit. Such action by the lenders could cause cross defaults under the indenture governing the notes. For a description of our senior secured credit facilities, see Footnote 109 to our audited consolidated financial statements included herein.

If our operating performance declines, we may be required to seek to obtain waivers from the lenders under the senior secured credit facilities or from the holders of other obligations, to avoid defaults thereunder. If we are not able to obtain such waivers, the lenders could exercise their rights upon default, and we could be forced into bankruptcy or liquidation.

Furthermore, if we were unable to repay the amounts due and payable under our senior secured credit facilities, the lenders under our senior secured credit facilities could proceed against the collateral granted to them to secure our borrowings thereunder. We have pledged substantially all of our assets as collateral under our senior secured credit facilities. If the lenders under senior secured credit facilities accelerate the repayment of borrowings, we cannot assure you that we will have sufficient assets to repay our senior secured credit facilities and our other indebtedness, including the notes, or will have the ability to borrow sufficient funds to refinance such indebtedness. Even if we were able to obtain new financing, it may not be on commercially reasonable terms, or terms that are acceptable to us.

Variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly.

Our borrowings under the existing senior secured credit facilities are at variable rates of interest and expose us to interest rate risk. IfFor example, the Federal Reserve has increased its benchmark interest rate multiple times recently in a bid to reduce rising inflation rates in the United States, and it is possible that additional rate hikes may be adopted in the future. As interest rates increase, our debt service obligations on the variable rate indebtedness ~~could~~ increase even though the amount borrowed remained the same, and our

net income ~~could decrease.~~decreases. The applicable margin with respect to the loans under the senior secured credit facilities is a percentage per annum equal to a reference rate plus the applicable margin.

From time to time in order to manage our exposure to interest rate risk, we may enter into derivative financial instruments, such as interest rate swaps and caps, involving the exchange of floating for fixed rate and fixed for floating rate interest payments. If we are unable to enter into interest rate swaps when necessary, it may adversely affect our cash flow and may impact our ability to make required principal and interest payments on our indebtedness.

In addition, a transition away from LIBOR as a benchmark for establishing the applicable interest rate may affect the cost of servicing our debt under the existing senior secured credit facilities. The Financial Conduct Authority of the United Kingdom ended LIBOR at the end of 2021. Although our borrowing arrangements provide for alternative base rates, the consequences of the phase out of LIBOR is not currently predictable. For example, use of a rate other than LIBOR as a means of calculating interest with respect to our outstanding variable rate indebtedness could lead to an increase in the interest rates incurred, it could result in an increase in the cost of such indebtedness, impact our ability to refinance some or all of our existing indebtedness or otherwise have a material adverse impact on our business, financial condition and results of operations.

A lowering or withdrawal of the ratings assigned to our debt securities by rating agencies may increase our future borrowing costs and reduce our access to capital.

Our debt currently has a non-investment grade rating, and there can be no assurance that any rating assigned by the rating agencies to our debt or our corporate rating will remain for any given period of time or that a rating will not be lowered or withdrawn entirely by a rating agency if, in that rating agency’s judgment, future circumstances relating to the basis of the rating, such as adverse changes, so warrant. A lowering or withdrawal of the ratings assigned to our debt securities by rating agencies may increase our future borrowing costs and reduce our access to capital, which could have a materially adverse impact on our financial condition and results of operations.

We may not be able to generate sufficient cash to service all of our indebtedness and may be forced to take other actions to satisfy our obligations under our indebtedness, which may not be successful.

If our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay investments and capital expenditures, or to sell assets, seek additional capital, or restructure or refinance our indebtedness. Our ability to restructure or refinance our debt will depend on the condition of the capital markets and our financial condition at such time. Any refinancing of our debt could be at higher interest rates and may require us to comply with more onerous covenants, which could further restrict our business operations. The terms of existing or future debt instruments, including the senior secured credit facilities and the indenture governing the notes, may restrict us from adopting some of these alternatives. In addition, any failure to make payments of interest and principal on our outstanding indebtedness on a timely basis would likely result in a reduction of our credit rating, which could harm our ability to incur additional indebtedness. These alternative measures may not be successful and may not permit us to meet our scheduled debt service obligations.

We may be adversely affected by any disruption in our information technology systems or by unauthorized intrusions or “hacking” into those systems and theft of confidential and sensitive information from them, or other cybersecurity-related incidents.

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. Various third parties, including computer hackers, who are continually becoming more aggressive and sophisticated, may attempt to penetrate our network security and, if successful, misappropriate confidential and sensitive customer, employee and/or supplier information. Such attempts may include malware, ransomware, denial-of-service attacks, social engineering, unauthorized access, human error, theft or misconduct. For example, as previously disclosed on November 5, 2022, and updated on April 6, 2023, we detected a ransomware infection that impacted portions of our network and caused disruption to daily business operations. In addition, one of our employees, contractors or other third parties with whom we do business may attempt to circumvent our security measures in order to obtain such information, or inadvertently cause a breach involving such information. While we have implemented systems and processes to protect against unauthorized access to or use of secured data and to prevent data loss and theft, there is no guarantee that these procedures are adequate to safeguard against all data security breaches or misuse of the data. Security breaches could also harm our reputation with our customers and retail partners, potentially leading to decreased revenues, and with federal and state government agencies and bodies.

The regulatory environment related to cybersecurity, data collection and use, and privacy is increasingly rigorous, with new and frequently changing requirements, and compliance with those requirements could result in additional costs. Our business and results of operations may be directly and adversely affected by future legislative, regulatory, or judicial actions. A significant compromise of confidential and sensitive employee, customer or supplier information in our possession could result in legal damages and regulatory

fines and penalties. The costs associated with cybersecurity, such as increased investment in technology, the costs of compliance with privacy laws, and costs incurred to prevent or remediate information security breaches and defend against any related actions, could be substantial and adversely impact our business.

Operation on multiple Enterprise Resource Planning (“ERP”) information systems, and the conversion from multiple systems to a single system, may negatively impact our operations.

We are highly dependent on our ERP information systems infrastructure in order to process orders, track inventory, ship products in a timely manner, prepare invoices to our customers, maintain regulatory compliance and otherwise carry on our business in the ordinary course. We currently operate on ~~six~~eight different ERP information systems. Since we must process and reconcile our

information from multiple systems, the chance of errors is increased, and we may incur significant additional costs related thereto. Inconsistencies in the information from multiple ERP systems could adversely impact our ability to manage our business efficiently and may result in heightened risk to our ability to maintain our books and records and comply with regulatory requirements. Any of the foregoing could result in a material increase in information technology compliance or other related costs and could materially negatively impact our operations. In the future, we may transition all or a portion of our systems to one ERP system. The transition to a different ERP system involves numerous risks, including:

Any of the foregoing could result in a material increase in information technology compliance or other related costs and could materially negatively impact our operations.

Other parties may infringe on our intellectual property rights or may allege that we have infringed on theirs.

Competitors or other third parties may infringe on or otherwise make unauthorized use of our intellectual property rights, including product designs, manufacturing practices, registered intellectual property and other rights. We rely on a variety of measures to protect our intellectual property and proprietary information. However, these measures may not prevent misappropriation, infringement or other violations of our intellectual property or proprietary information and a resulting loss of competitive advantage. If we determine that such infringement or violation has occurred, legal action to enforce our rights may require us to spend significant amounts in legal costs, even if we ultimately prevail.

Conversely, given the nature of our business and product designs, competitors or other third parties may allege that we, or consultants or other third parties retained or indemnified by us, have infringed, misappropriated, or otherwise violated their intellectual property rights. Even though we believe such claims and allegations of intellectual property infringement or violations would be without merit, defending against such claims would be time consuming and expensive and could result in the diversion of time and attention of our management and employees. Given the rapidly changing and highly competitive business environment in which we operate, and the increasingly complex designs of our products and other companies’ similar products, the outcome of any contemplated intellectual property-related litigation would be difficult to predict and could cause us to lose significant revenue, to be prohibited from using the relevant designs, systems, processes, technologies or other intellectual property, to cease offering certain products or services or to incur significant license, royalty or technology development expenses.

The nature of our business exposes us to product liability, warranty and other claims.

We are, from time to time, involved in product liability, product warranty and other 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.

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.

From time to time we are subject to legal and regulatory proceedings which seek material damages from us. These proceedings may be negatively perceived by the public and materially and adversely affect our business.

We are subject to legal and regulatory proceedings from time to time which may result in material damages. Although we do not presently believe that any of our current legal or regulatory proceedings will ultimately have a material adverse impact on our financial performance or operations, we cannot assure you that we will not incur material damages or penalties in a lawsuit or other proceeding in the future and/or significant defense costs related to such lawsuits or regulatory proceedings. For example, many of our products are installed in large, multi-unit condominiums or apartments or similar developments, and we may face legal claims for breach of warranties or other claims alleging product defects on a large-scale in connection with such projects. Also, we operate a fleet of delivery trucks and, in addition to the significant compliance-related costs associated with operating such a fleet, we may incur significant adverse judgments, damages and penalties related to accidents that those trucks may be involved in from time to time. Significant adverse judgments, penalties, settlement amounts, amounts needed to post a bond pending an appeal or defense costs could materially and adversely affect our liquidity and capital resources. It is also possible that, as a result of a present or future governmental or other proceeding or settlement, significant restrictions will be placed upon, or significant changes made to, our business practices, operations or methods, including pricing or similar terms. Any such restrictions or changes may adversely affect our profitability or increase our compliance costs.

Our Bylaws contain an exclusive forum provision that may discourage lawsuits against us and our directors and officers.

Our Amended and Restated Bylaws (our “Bylaws”) provide that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or if the Court of Chancery does not have jurisdiction, the federal district court for the District of Delaware) will be the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of the Corporation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the Corporation to the Corporation or the Corporation’s stockholders, (iii) an action asserting a claim arising pursuant to any provision of the DGCL or the Corporation’s Certificate of Incorporation or these By-laws (as either may be amended from time to time), or (iv) any action asserting a claim governed by the internal affairs doctrine. Our exclusive forum provision is not intended to apply to any actions brought under the Securities Act of 1933 (the “Securities Act”), as amended, or the Securities Exchange Act of 1934 (the “Exchange Act”). Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder and Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. Accordingly, the exclusive forum provision in our Bylaws will not relieve us of our duties to comply with the federal securities laws and the rules and regulations thereunder, and our stockholders will not be deemed to have waived our compliance with these laws, rules and regulations.

This forum selection provision may limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us. It is also possible that, notwithstanding the forum selection clause included in our certificate of incorporation, a court could rule that such a provision is inapplicable or unenforceable.

Cyber criminals and malicious nation-state governments sponsored cyberthreat activity is becoming more sophisticated and effective every day, which we recognize includes increased targeting of the manufacturing sector and companies. All companies that utilize technology are subject to cyberthreat of breaches of their cybersecurity programs. To mitigate the threats to our Company, we take a comprehensive approach to cybersecurity risk management and technology infrastructure protections as a top priority.

Our board of directors (the “Board”) in conjunction with the Audit Committee and members of management are actively involved in the oversight of our risk management program, of which cybersecurity represents a vital component. As described in more detail below, we have established policies, standards, processes, and practices for assessing, identifying, and managing material risks from cybersecurity threats, including but not limited to, our ability to sufficiently defend against all types of sophisticated tactics, techniques, and procedures (“TTPs”) used by malicious nation-state governments sponsored cyberthreat activity

We have devoted significant financial and personnel resources to implement and maintain security measures to meet regulatory requirements and customer expectations, and we intend to continue to make significant investments to maintain the security of our data and cybersecurity infrastructure. There can be no guarantee that our policies and procedures will be properly followed in every instance or that those policies and procedures will be effective.

Having been a target of cyber criminals in November 2022, we are keenly aware of the risks and consequences that a cybersecurity incident unleashes on the technology function within a company. While this previous cyber-attack did not materially affect us and, in our belief, is not reasonably likely to materially affect us, future cybersecurity incidents and threats may materially affect us, including by affecting our business strategy, results of operations, or financial condition. See Item 1A., “Risk Factors” for additional details regarding cybersecurity risks.

Our policies, standards, processes, and practices for assessing, identifying, and managing material risks from cybersecurity threats are integrated into our overall risk management program and are based on frameworks established by the National Institute of Standards and Technology (“NIST”), the U.S. Center for Internet Security (“CIS”) and other applicable industry standards. Our defense-in-depth cybersecurity program is designed to focus on the following key areas:

Our cybersecurity risks are identified and addressed through a comprehensive, cross-functional approach. Key security, risk, and compliance stakeholders meet regularly to develop strategies for preserving the confidentiality, integrity, and availability (“CIA”) of Company and customer information, identifying, preventing, and mitigating cybersecurity threats, and effectively responding to cybersecurity incidents. We maintain cybersecurity incident controls and procedures that are designed to ensure prompt escalation of incidents so that decisions regarding public disclosure and reporting of such incidents can be made by management and the Board in a timely manner.

Annually, we conduct a cybersecurity risk assessment with quarterly updates to the Audit Committee of the Board that considers information from internal stakeholders, known information security vulnerabilities, and information from external sources (e.g., cybersecurity alerts and advisories from the U.S. Cybersecurity & Infrastructure Security Agency, relevant technology vendors, related companies, industry trends, and evaluations by third parties and consultants). The results of these assessments are used to drive alignment on, and prioritization of, initiatives to enhance our security controls, make recommendations to improve processes, and inform a broader enterprise-level risk assessment that is presented to our Board, Audit Committee, and members of management.

We regularly assess and deploy technical cyber-safeguards designed to protect our information systems from cybersecurity threats. Such safeguards are regularly evaluated and improved based on vulnerability assessments, third-party cybersecurity threat assessments and incident response experience.

We have established comprehensive incident response and recovery plans and continue to regularly test and evaluate them for effectiveness of those plans. Our incident response and business recovery plans address — and guide our employees, management, Audit Committee, and the Board on — our response to a cybersecurity incident.

We have implemented controls designed to identify and mitigate cybersecurity threats associated with our use of third-party service providers. Such providers are subject to security risk assessments at the time of onboarding, contract renewal, and upon detection of an increase in risk profile. We use various inputs in such random risk assessments, including information supplied by providers and third parties.

In addition, we require our providers to meet appropriate security requirements, controls and responsibilities and investigate security incidents that have impacted our third-party providers, as appropriate.

Our policies require each of our employees to contribute to our cyber and data security efforts. We regularly remind employees of the importance of handling and protecting data, including through annual privacy and security training to enhance employee awareness on how to detect and respond to cybersecurity threats.

Our cybersecurity policies, standards, processes, and practices are regularly assessed by external consultants and auditors. These assessments include various activities including information security maturity assessments, audits and independent reviews of our information security control environment and operating effectiveness. For example, in 2022 and 2023, we conducted an independent cyber security maturity assessment and external penetration test to assess our controls against the NIST Cybersecurity Framework. The results of significant assessments are reported to management, the Audit Committee and Board. Cybersecurity processes are adjusted based on the information provided from these assessments. We have also completed cybersecurity attestations that demonstrate our dedication to protecting the data entrusted to us.

Our Board, in coordination with the Audit Committee, oversees our management of cybersecurity risk. They receive at least quarterly reports, or more frequently if deemed necessary, from management about the prevention, detection, mitigation, and remediation of cybersecurity incidents, including material security risks and information security vulnerabilities. Our Audit Committee directly oversees our cybersecurity program. The Audit Committee receives regular updates from management on cybersecurity risk resulting from risk assessments, progress of risk reduction initiatives, external auditor feedback, control maturity assessments, and relevant internal and industry cybersecurity incidents.

Our Senior Vice President (“SVP”) of Production Innovations & Technology, Vice President (“VP”) of Information Technology, Director of Information Security & Infrastructure, and General Counsel have primary responsibility for assessing and managing material cybersecurity risks and are members of management’s Security Steering Committee (the “Security Committee”), which is a governing body that drives alignment on security decisions across the Company. The Security Committee meets quarterly to review security performance metrics, identify security risks, and assess the status of approved security enhancements. The Security Committee also considers and makes recommendations on security policies and procedures, security service requirements, and risk mitigation strategies.

Our SVP has served in various roles in both engineering, operations, and information technology for over 20 years. He holds an undergraduate degree in mechanical engineering and a master’s in business administration. Our VP of Information Technology has served in various roles in information technology and information security for 20 years. He holds an undergraduate degree in both industrial technology and distribution. Our Director of Information Security & Infrastructure has served in similar roles within information technology for over 25 years including risks arising from cybersecurity threats at several large publicly traded companies. He holds an undergraduate degree in criminal justice. Our General Counsel has over 20 years of experience managing risks, including risks arising from cybersecurity incidents and threats, at several large publicly traded companies.


	Manu- facturing		Support		Storage		Storefront		Manu- facturing		Support		Storage		Storefront
	(in square feet)								(in square feet)
Owned:
Main plant and corporate office, N. Venice, FL		348,000		15,000		—		—		348,000		15,000		—		—
Glass tempering and laminating, N. Venice, FL		107,000		5,000		—		—		107,000		5,000		—		—
ILAB research and testing, N. Venice, FL		—		22,000		—		—		—		22,000		—		—
Assembly processing facility, N. Venice, FL		96,000		—		—		—
Manufacturing and storage (Triple D) facility, N. Venice, FL		102,000		—		15,000		—		102,000		—		15,000		—
Support facility, N. Venice, FL		—		7,000		—		—
Insulated glass building, N. Venice, FL		42,000		—		—		—
Childcare facility, N. Venice, FL										—		7,000		—		—
Insulated glass building/expansion, N. Venice, FL										138,000		—		—		—
PGT Wellness Center, N. Venice, FL		—		3,600		—		—		—		3,600		—		—
Plant and administrative offices, Clovis, CA (Anlin)										76,000		10,000		—		—

Leased:
Support facility (Endeavor Court), Nokomis, FL		—		12,000		—		—		—		12,000		—		—
Storage facility (Eco storage), Medley, FL		—		—		182,057		—		—		—		182,000		—
Storage facility (Technology Park), Nokomis, FL		—		—		10,475		—		—		—		10,500		—
Storage facility (Commerce Drive), Nokomis, FL		—		—		6,400		—		—		—		6,400		—
Storage facility (Riverview warehouse), Riverview, FL		—		—		75,326		—		—		—		75,300		—
Storage facility (MLK Blvd), Tampa, FL		—		—		2,000		—
Storage facility (Parque Drive), Ormond Beach, FL		—		—		1,000		—
Storage facility, Medley, FL										—		—		5,200		—
Storage facility (Field Service), Pompano Beach, FL										—		—		4,800		—
Storage facility (Eagle Falls Place), Tampa, FL										—		—		4,600		—
Storage facility (Metro Parkway), Ft. Myers, FL		—		—		3,800		—		—		—		3,800		—
Storage facility (42nd St), Palm City, FL		—		—		2,250		—		—		—		2,300		—
Storage facility (Silver Star), Orlando, FL		—		—		3,159		—		—		—		3,200		—
Storage facility, Boynton Beach, FL		—		—		100		—
Distribution centers (Eco), Medley, FL		—		112,166		—		—
Warehouse, Commerce City, CO										—		—		33,600		—
Distribution facility, Medley, FL										—		40,000		—		—
Plant and administrative offices, Medley, FL (Eco)		350,000		—		—		—		350,700		—		—		—
Plant and administrative offices, Ft. Myers, FL		130,000		—		—		—		130,000		—		—		—
Plant and administrative offices, Irvine, CA (CRi)		28,000		1,400		—		—		28,000		1,400		—		—
Plant and administrative offices, Clovis, CA (Anlin)		16,000		1,426		—		—
Plant and administrative offices, Hialeah, FL (CGI)		305,000		20,000		—		—		305,000		20,000		—		—
Plant and administrative offices, Miami, FL (CGIC)		71,000		10,000		—		—
Plant and administrative offices, Phoenix, AZ (WWS)		160,000		10,000		—		—		238,800		10,000		—		—
Plant and administrative offices, Tampa, FL (NewSouth)		230,000		8,500		—		—		230,000		8,500		—		—
SEBU showrooms located in FL, SC and TX (NewSouth)		—		—		—		134,027
Plant and administrative offices, Salt Lake City, UT (Martin)										194,800		10,000		—		—
SEBU showrooms located in FL, SC, GA and TX (NewSouth)										—		—		—		232,200
WEBU showrooms located in CA (WWS)		—		—		—		19,166		—		—		—		19,200
Triple Diamond Glass fabrication facility, Prince George Co., VA										291,700		—		—		—

Total square feet		1,985,000		228,092		301,567		153,193		2,540,000		164,500		346,700		251,400

In addition to the above owned and leased properties, we also own three parcels of undeveloped land in North Venice, Florida, available for future construction needs we may have.

The Triple Diamond Glass fabrication facility is currently under construction, and is expected to be operational in 2024.

Our major property leases ~~discussed~~ above expire between ~~March 2022~~May 2024 and ~~May 2032.~~June 2035. Many of our property leases require us to pay taxes, insurance and common area maintenance expenses associated with the properties.

All of our owned properties secure borrowings under our credit agreement (dated February 16, 2016, as amended by the first amendment thereto, dated as of February 17, 2017, the second amendment thereto, dated as of March 16, 2018, the third amendment thereto, dated October 31, 2019, ~~and~~ the fourth amendment thereto dated October 25, 2021, and the fifth amendment dated October 12, 2022, as otherwise amended, restated, modified or supplemented, the “2016 Credit Agreement due ~~2024”~~2027”). We believe these operating facilities are adequate in capacity and condition to service existing customer needs.

We are involved in various claims and lawsuits incidental to the conduct of our business in the ordinary course. We carry insurance coverage in such amounts in excess of our self-insured retention as we believe to be reasonable under the circumstances and that may or may not cover any or all of our liabilities in respect of claims and lawsuits. We do not expect that the ultimate resolution of these matters will have a material adverse impact on our financial position, cash flows or results of operations.

Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Our Common Stock trades on the New York Stock Exchange under its symbol of “PGTI”. On February ~~25, 2022,~~16, 2024, the closing price of our Common Stock was ~~$20.41~~$41.39 as reported on the New York Stock Exchange. The number of stockholders of record of our Common Stock on that date was approximately ~~2,700,~~2,500, although we believe that the number of beneficial owners of our Common Stock is substantially greater.

We do not pay a regular dividend. Any determination relating to dividend policy will be made at the discretion of our Board of Directors. The terms of the agreements governing our outstanding borrowings restrict our ability to pay dividends.

The information required by this item appears in our definitive proxy statement for our annual meeting of stockholders under the caption “Security Ownership of Certain Beneficial Owners and Management” and “Equity Compensation Plan Information,” which information is incorporated herein by reference.

~~None.~~On February 7, 2023, the Company announced that its Board of Directors approved a new, share repurchase program which authorizes the Company to purchase up to $250.0 million of its common stock. This program permits the Company to purchase shares of its common stock from time to time through open-market purchases, in privately negotiated transactions, or by other means, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, in accordance with applicable securities laws and other restrictions. We began repurchasing shares under this program beginning on February 27, 2023. The timing and total amount of stock repurchases will depend upon business, economic and market conditions, corporate and regulatory requirements, prevailing stock prices, and other considerations. The share repurchase program had an initial term of 3 years, through February 3, 2026, and may be suspended or discontinued at any time, and does not obligate the company to acquire any amount of common stock.

The following table represents information relating to share repurchases under this program during our fourth fiscal quarter ended December 30, 2023:

The following graphs compare the percentage change in PGT Innovations, Inc.’s cumulative total stockholder return on its Common Stock with the cumulative total stockholder return of the NYSE Composite Index, the SPDR S&P Homebuilders ETF, and the Standard & Poor’s Building Products Index over the period from ~~January 3, 2017 (the first trading day of our 2017 fiscal year), to~~ December ~~31, 2021~~28, 2018 (the last trading day of our ~~2021~~2018 fiscal year), to December 29, 2023 (the last trading day of our 2023 fiscal year).

* Graph shows returns generated as if $100 were invested on ~~January 3, 2017~~December 28, 2018 (the ~~first~~last trading day of our ~~2017~~2018 fiscal year) for 60 months ended December ~~31, 2021~~29, 2023 (the last trading day of our ~~2021~~2023 fiscal year), in PGTI stock or in the SPDR S&P Homebuilders ETF Fund, which is an exchange-traded fund that seeks to replicate the performance of the S&P Homebuilders Select Industry Index, or in the S&P 500 Building Products index, which is a fund that seeks to replicate the performance of the building products manufacturers who are included in the Standard and Poors 500 index.

Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Our Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) should be read in conjunction with our Consolidated Financial Statements and related Notes included in Item 8. Management's Discussion and Analysis comparing the results for the year ended ~~January 2, 2021,~~December 31, 2022, to the results for the year ended ~~December 28, 2019~~January 1, 2022 can be found in Item 7 of our Annual Report on Form 10-K for the year ended ~~January 2, 2021,~~December 31, 2022, filed with the SEC on ~~March 2, 2021,~~February 27, 2023, which is hereby incorporated by reference. In the comparisons which follow, the ~~year~~years ended ~~January 1,~~December 30, 2023 and December 31, 2022 each consisted of 52 ~~weeks, whereas the year ended January 2, 2021 consisted of 53~~ weeks. We believe the effect of the extra week in our 2020 fiscal year ended January 2, 2021 was immaterial and does not impact the comparability of our results of operations for the year ended January 1, 2022 to the year ended January 2, 2021.

During March 2020, a global pandemic (the “Pandemic”) was declared by the World Health Organization related to the rapidly growing outbreak of a novel strain of coronavirus (“COVID-19”). The Pandemic has resulted in a significant number of infections, hospitalizations and deaths in several of our key markets, including Arizona, California, Florida and Texas. The Pandemic has significantly affected economic conditions in those markets, and in the United States in general, and internationally, including due to federal, state and local governments and employers reacting to the public health crisis with mitigation measures, and also due to the general fear and uncertainty created by the Pandemic, all of which has resulted in workforce, supply chain and production disruptions, along with reduced demand and spending in many industries and markets. Although many of the government-mandated restrictions on economic and social activities that were put in place as part of the initial response to the Pandemic have been lifted, and vaccines with high degrees of efficacy have been approved by the United States Food and Drug Administration, it is still uncertain when or if the nation-wide program of vaccination will result in herd immunity to COVID-19 in the United States or globally. This uncertainty is being impacted by several factors, including vaccine hesitancy or resistance, and the emergence of the highly-contagious strains of COVID-19 known as the Delta and Omicron variants. As a result, it is still currently unclear when, or if, social, business, occupational, educational and economic conditions will return to pre-Pandemic conditions.

Our first priority has been and remains the health and safety of our employees, our customers and their families and the communities in which we operate, and as COVID-19 gained a foothold in the Southeast Florida area, we took swift action to protect our employees by temporarily suspending operations at and fumigating our Miami and Hialeah, Florida facilities, each for one-week periods in April 2020. We also took that step at our Western Windows Systems facility in Phoenix, Arizona during July 2020. All of our manufacturing locations are operational and have been deemed essential under various government orders. Each of our facilities has implemented policies and procedures designed to protect the health and safety of our team members in light of the Pandemic, including: 1) continuing to monitor guidelines from federal, state and local health authorities for personal health and safety, and updating our protocols as needed; 2) implementing a mandatory face-mask policy for employees at all of our locations, and providing them with those masks where needed; 3) enforcing social distancing in common areas and work areas, including production lines where possible; 4) implementing work-at-home programs where possible; and 5) sourcing supplies such as reusable masks, hand sanitizer and cleaning solutions for use by our employees. However, the highly-contagious Delta and Omicron variants impacted our operations in 2021 through incremental costs incurred relating to cleaning and sanitizing costs for the protection of the health of our employees and safety of our facilities, as well as costs of lost productivity from employee quarantines and testing, and cancellations of previously scheduled trade shows and customer events, resulting in negative impacts on our results of operations for the years ended January 1, 2022, and January 2, 2021.

Although recent developments regarding the Pandemic appear to be positive, and point to the possibility that vaccination programs and other safety measures implemented throughout the United States may be having the hoped for beneficial affects intended, the extent to which the continuing circumstances around the Pandemic could affect our future business, operations and financial results continue to depend upon numerous evolving factors that we are not able to accurately predict, including the timing of any relief that may come from the current program of nationwide vaccinations and its effect on the duration of the continuing economic and market disruptions related to the Pandemic, and whether such vaccines are effective against any current and new variants of coronavirus, and the nature, amounts and duration of any additional government stimulus measures designed to bolster the economy. As such, we continue to be unable to accurately predict the impact the Pandemic and the challenges it has created for the U.S. and global economies, will have on our financial performance and operations going forward due to numerous uncertainties, including the severity of the disease, the duration of the outbreak, when or if herd immunity is achieved in the United States, especially in our key markets, actions that may be taken by governmental authorities to attempt to control the Pandemic, the impact to our customers’ and suppliers’ businesses and other factors identified in Part I, Item 1A “Risk Factors” herein. We will continue to evaluate the nature and extent of the impact of the Pandemic to our business, consolidated results of operations, and financial condition.

During ~~2021,~~2023, we ~~experienced increases in~~saw solid repair and remodel sales, offset by new construction headwinds at both our Southeast and Western ~~segments,~~segments. These factors, as well as a full year of sales from Martin in 2023, compared with only post-acquisition sales from October 2022, resulted in a slight growth in sales for 2023 compared to 2022. Our total net sales for 2023 were $1,504.2 million, increasing 0.8% compared to $1,492.0 million in 2022. We continued to make strategic marketing investments which have paid dividends through customer awareness during the 2023 repair and remodeling season, as demand for our premium products remains strong. However, we have faced challenging conditions in the new construction channel as we believe the current high-interest rate environment has had a softening effect on demand. This has been especially true in the west as our ~~key markets~~organic volume is down year-over-year, partially offset by a full year of ~~Florida, Arizona and California continued to increase, and the strong order entries we reported~~sales in ~~prior quarters have translated into higher shipments~~2023 from our Martin acquisition, versus only from October 14, 2022, in ~~2021.~~ 2022. Sales growth at our Southeast segment was entirely organic.

Our Southeast segment's net sales ~~grew to $1,161.5~~were $1,130.4 million in ~~our 2021 fiscal year,~~2023, compared to $1,110.4 million in 2022, an increase of ~~$278.9~~$20.0 million, or ~~31.6%,~~1.8%. Solid repair and remodeling sales was offset by soft new construction sales, resulting in slight organic growth in 2023 compared with 2022. Strong sales of our premium WinGuard products at our PGT brand offset decreases in other Southeast segment brands and led to modest organic growth in our Southeast segment.

Our Western segment's net sales were $373.8 million in 2023, compared to ~~$882.6~~$381.6 million in ~~2020. Sales in 2021 includes~~2022, a ~~combined $107.1 million in sales from our Eco and Anlin acquisitions. Excluding sales from all 2021 acquisitions, we experienced solid organic growth~~decrease of ~~$164.4~~$7.8 million, or 18.6%, in 2021, compared to 2020. We believe this increased demand is being driven by improved economic conditions in 2021 and our markets in California have gained momentum since COVID restrictions were lifted, and our Texas and Arizona markets continued to strengthen. We continue to see strong demand in both our new construction and repair and remodel channels in the Southeast regions which showed strong demand as compared to the challenging conditions of 2020 which were a result of the Pandemic. Our Southeast business unit had2.0%. While sales ~~of $968.7 million in 2021, an increase of $216.3 million, or 28.7%, compared to $752.4 million in 2020. Net sales~~for 2023 of our Western segment includes acquisition growth from Martin, our existing business saw an organic decline in sales due to soft conditions in the new construction channel. While we believe that our production builder business remains strong, and that there is pent up demand for conversion to indoor/outdoor living products, we believe that the high-interest rate environment we are in continues to be a drag on new construction demand.

Our gross profit increased ~~$62.6~~to $590.6 million in 2023, producing a gross margin of 39.3%, compared to $570.7 million in 2022, an increase of $20.0 million, or ~~48.1%~~3.5%, ~~to $192.8 million in 2021, from $130.2 million in 2020.~~

We are optimistic that we will see this growth we have experienced continue in 2022, and we continue to make strides in investing in the resources necessary to meet this increasing demand. During 2021 we faced headwinds from the pressure on our margins due to recruiting, training and workforce retention costs. Additionally, aluminum spot prices have increased significantly throughout the year, which leaves the unhedged portions of our expected aluminum usage exposed to the volatility of changing aluminum prices, as well as the increases in prices we have experienced in many of our other material costs, including glass, vinyl, hardware and supplier-based surcharges. Asproduced a result of these headwinds, we announced a 3% surcharge in Florida that took effect in November 2021 for all then existing and future orders to help offset these costs, which we believe began benefiting gross margin ~~immediately through~~of 38.2%, an improvement in gross margin of 110 basis points from 2022 to 2023. We were able to produce this operational improvement, despite new construction headwinds, by continued solid performance from our operating teams, the ~~completion~~impact of our 2021 fiscal year. Additionally, we announced another 6% to 12% price increase for new orders beginning November 1, 2021, that we expect to begin to impact our results beginning in 2022 due to our lead times.prior-year pricing actions offsetting material and wage inflation, and additional cost management discipline, partially offset by reduced fixed cost leverage from lower volumes.

Our backlog, which we define as customer orders that we have accepted but not yet shipped, has ~~increased~~decreased significantly, to ~~$355.9~~$175.3 million as of ~~January 1, 2022,~~December 30, 2023, from ~~$199.5~~$228.8 million as of ~~January 2, 2021. We define backlog as orders that we have received and have accepted from customers, but that have not yet shipped.~~December 31, 2022. The majority of this ~~increase is a result of an increased level of order entry during 2021, but also includes increases relating to the acquisitions. However, during 2021, our~~decrease in backlog increased as a result of growth in orders above our capacity to keep pace with the increased demand. As a result, during 2021, we opened an additional approximately 130,000 square foot manufacturing facility in Fort Myers, Florida to provide additional manufacturing capacity.

During the first half of 2020, we also experienced some disruption in our ability to obtain adequate supplies of glass for our manufacturing processes by what we think were the impacts of the Pandemic on our glass supply chain partners, which ultimately resulted infrom an increase in ~~our~~the Company’s overall production capacity, with corresponding lower lead times to our customers. This factor lessened during the second half of 2020 and into 2021, and obtaining adequate supplies of glass has become less of a challenge to our supply chain. We continue to have good relations with our glass supply chain partners, and we have gained additional control over our supply chain for glass with our acquisition of a 75% stake in Eco, whose vertically integrated operations include a glass manufacturing division which supplies all of the impact-resistant glass used in Eco’s window and door products. In addition, Eco’s glass division sells laminated glass products to other companies, including to us, as an additional source of revenue. We believe that our investment in Eco has provided us with a secure, high-quality, dependable supply of glass for our operations.times.

During ~~2021,~~2023, we generated ~~$63.7~~$196.9 million in cash flow from operations, ~~a decrease~~an increase of ~~$11.8~~$0.5 million, or 0.3% compared to ~~2020. In 2020, during the second half~~$196.4 million in 2022. We continue to generate strong cash from operations due to profitable operations and expansion of our gross margin through our focus on cost discipline. This strong cash generation has enabled up to paydown $115.0 million of the ~~year, our order entry levels began increasing and continued~~$160.0

million borrowed under the New Revolving Credit Facility on October 12, 2022, the proceeds from which were used to ~~increase though~~fund the ~~end~~cash portion of the year. Because of this increased demand for our products, we determined to continue to manufacture and ship during late December 2020, whereas in 2021, we had our usual holiday shut-down. As such, we saw a decrease in accounts payable at the end of 2021 from payments of payables not seen at the end of 2020 due to the continuation of operations through the end of the year. The resulted in a use of operating cash flow for payments of accounts payable at the end of 2021, compared to a source of operating cash flow at the end of 2020.Martin Acquisition.

We ended the ~~2021~~2023 fiscal year with ~~$96.1~~$32.7 million in ~~cash,~~cash. We have no scheduled debt repayment obligations until the maturity of our 2016 Credit Agreement due ~~2024,~~2027, and ~~have $74.7~~had $196.5 million in availability under the revolving credit facility under our 2016 Credit Agreement due ~~2024,~~2027, which does not expire until October ~~2024.~~2027.

Cash generated from operations was generally used to fund operations and investing cash flows, which was primarily composed of capital expenditures in ~~2021. However, in 2021, we consummated several acquisitions, including the Anlin Acquisition, which was funded primarily with proceeds from the issuance of the 2021 Senior Notes due 2029,~~2023 and, ~~incremental~~as discussed above, repay borrowings under the ~~2016~~New Revolving Credit Agreement due 2024, but which also included the Eco Acquisition, the funding of which included using $31.1 million of cash on hand, and the acquisition of the assets of CRi, which was an all-cash acquisition and used $12.1 million of cash on hand. Additionally, during 2021, due to our decision in early 2020 to decrease spending on a majority of capital projects as part of our cash preservation strategy due to the uncertainty around the Pandemic, we increasedFacility. During 2023, our capital spending increased to ~~near pre-Pandemic levels. This resulted in an increase in capital expenditures to $33.4~~$69.5 million, compared to ~~$24.8~~$45.4 million in ~~2020,~~2022, an increase of ~~$8.6~~$24.1 million in cash used.


	Year Ended							Year Ended
	January 1,			January 2,			Percent Change	December 30,			December 31,			Percent Change
	2022			2021			2021-2020	2023			2022			2023-2022
(in thousands, except per share amounts)
Net sales	$	1,161,464		$	882,621		31.6%	$	1,504,241		$	1,491,954		0.8%
Cost of sales		757,965			561,297		35.0%		913,600			921,285		(0.8%)

Gross profit		403,499			321,324		25.6%		590,641			570,669		3.5%
Gross margin		34.7	%		36.4	%			39.3	%		38.2	%

SG&A expenses		303,043			224,386		35.1%		404,193			402,886		0.3%
SG&A expenses as a percentage of net sales		26.1	%		25.4	%			26.9	%		27.0	%
Impairment of trade name		—			8,000				5,500			7,423
Restructuring costs and charges		—			4,227
Restructuring costs and charges, net									1,722			—

Income from operations		100,456			84,711				179,226			160,360		11.8%

Interest expense, net		30,029			27,719		8.3%		31,077			28,879		7.6%
Debt extinguishment costs		25,472			—				—			410
Income tax expense		9,759			11,884		-17.9%		38,010			32,666		16.4%

Net income		35,196			45,108		-22.0%		110,139			98,405		11.9%
Less: Net income attributable to redeemable non-controlling interest		(2,318	)		—				(1,101	)		(1,523	)

Net income attributable to the Company	$	32,878		$	45,108		-27.1%	$	109,038		$	96,882		12.5%

Calculation of net income per common share attributable to common shareholders:
Net income attributable to the Company	$	32,878		$	45,108			$	109,038		$	96,882
Change in redemption value of redeemable non-controlling interest		(6,081	)		—				(1,637	)		2,000
Net income attributable to common shareholders	$	26,797		$	45,108			$	107,401		$	98,882

Net income per common share attributable to common shareholders:
Basic	$	0.45		$	0.77			$	1.84		$	1.65
Diluted	$	0.45		$	0.76			$	1.83		$	1.64

Weighted average number of common shares outstanding:
Basic		59,518			58,887				58,363			59,926
Diluted		60,058			59,360				58,700			60,319

Net sales for ~~2021~~2023 were ~~$1,161.5~~$1,504.2 million, a ~~$278.9~~$12.3 million, or ~~31.6%~~0.8%, increase in sales, from ~~$882.6~~$1,492.0 million in the prior year.

The following table shows net sales by segment (in millions, except percentages):


	Year Ended													Year Ended
	January 1, 2022					January 2, 2021								December 30, 2023			December 31, 2022
	Sales		% of sales			Sales		% of sales			% change			Sales		% of sales	Sales		% of sales	% change
Product category:
Southeast segment	$	968.7		83.4	%	$	752.4		85.2	%		28.7	%	$	1,130.4	75.1%	$	1,110.4	74.4%	1.8%
Western segment		192.8		16.6	%		130.2		14.8	%		48.0	%		373.8	24.9%		381.6	25.6%	(2.0%)

Total net sales	$	1,161.5		100.0	%	$	882.6		100.0	%		31.6	%	$	1,504.2	100.0%	$	1,492.0	100.0%	0.8%

Net sales of our Southeast segment were ~~$968.7~~$1,130.4 million in ~~2021,~~2023, compared with ~~$752.4~~$1,110.4 million in ~~2020,~~2022, an increase of ~~$216.3 million.~~ $20.0 million, or 1.8%. This increase in sales at our Southeast segment was entirely organic. Demand for our premium products remains strong. However, we have faced challenging conditions in the new construction channel as we believe the current high-interest rate environment has had a softening effect on demand. Comparisons to prior year periods are also impacted by the fact that Hurricane Ian, a large and destructive Category 4 Atlantic hurricane, made landfall on the southwest Florida coastline on September 28, 2022, causing disruption to our ability to manufacture and distribute our products and affected our customers’ ability to accept deliveries of our products.

Net sales of our Western segment were ~~$192.8~~$373.8 million in ~~2021,~~2023, compared with ~~$130.2~~$381.6 million in ~~2020,~~2022, an ~~increase~~decrease of ~~$62.6 million.~~$7.8 million, or 2.0%, as a result of the new construction channel headwinds discussed above. Sales for 2023 of our Western segment ~~are composed of~~includes acquisition growth from Martin. Excluding Martin's 2023 sales, ~~of WWS.~~our existing business was negatively impacted by softness in the new construction channel in 2023, compared to 2022.

The ~~increase~~softness in ~~net sales~~the new construction channel in ~~2021 of $278.9 million was primarily driven by organic sales growth at~~ both ~~our~~the Southeast and Western segments, ~~and the effects of the recovery from the Pandemic, as well as revenues added through acquisitions, which included $107.1 million from our Eco and Anlin Acquisitions. We believe the organic increase~~although improving in ~~sales of~~ our Southeast segment, ~~is due to~~has resulted in a ~~resumption of demand for our products~~decrease in unit volume in both the new construction and repair and remodel markets that approached the pre-Pandemic strength that existed in early 2020. Our direct-to-consumer brand also experienced solid organic growth in 2021, compared to 2020. Our Western segment experienced strong growth in 2021, compared to 2020,segments, which we believe continued to see a strengthening housing market in the western United States that began in late 2020, but also as the effects of the Pandemic, which appeared to be more pronounced in the West, lessened in 2021 compared tohas been partially offset by last ~~year. Sales of our Western segment include the increase from our CRi Acquisition.~~year's price increases.

Gross profit was ~~$403.5~~$590.6 million in ~~2021,~~2023, an increase of ~~$82.2~~$20.0 million, or ~~25.6%~~3.5%, from ~~$321.3~~$570.7 million in the prior year. Gross margin was ~~34.7%~~39.3% in ~~2021,~~2023, compared to ~~36.4%~~38.2% in the prior year, a percentage-point ~~decrease~~increase of ~~1.7%~~1.1%. ~~During~~Gross profit and gross margin benefited from several positive factors, including continued solid performance from our operating teams, the ~~second quarter~~impact of ~~2021,~~prior-year pricing actions offsetting material and wage inflation, and additional cost management discipline, partially offset by reduced fixed cost leverage from lower volumes. Additionally, gross profit in response to increasing demand and a resulting increase in our backlog of orders, we determined to increase our manufacturing headcount across our Florida operations. While this increase in headcount positions us to better respond to increasing demand through higher production rates, it also required additional investments in training and onboarding2023 includes the impact of the new members of our manufacturing team to maintain our high standards for safety and quality as new members gain experience in their new roles. These incremental investments resulted in a reduction in gross margin in 2021 as compared to 2020. Gross margin was also negatively impacted by inflationary conditions on materials, labor and material delivery costs, which continued to be prevalent in 2021. Earlier this year, we announced price increases to attempt to offset these inflationary conditions, which began to offset these cost impacts towards the end of 2021. We also implemented a 3% surcharge on all existing orders in Florida which took effect in November 2021 to immediately address these rising operating costs which began benefiting gross margin in the late third quarter of 2021.Additionally, we announced another 6% to 12% price increase for new orders beginning November 1, 2021, that we began to see the benefit of beginning of in 2022. Gross margin in 2021 benefited from improved operating efficiencies in our Western segment,Martin acquisition. Regarding 2022 and the impact of Hurricane Ian, in addition to the impact to profits from lost sales, we incurred disruption and recovery costs as a result of ~~and accretion from our acquisitions~~the storm totaling $1.9 million 2022, of ~~Eco, CRi and Anlin.~~which $1.1 million is classified as cost of sales.

SG&A expenses for ~~2021~~2023 were ~~$303.0~~$404.2 million, an increase of ~~$78.6~~$1.3 million, or ~~35.0%~~0.3%, from ~~$224.4~~$402.9 million in ~~2020.~~2022. As a percentage of net sales, SG&A was ~~26.1%~~26.9% in ~~2021,~~2023, compared to ~~25.4%~~27.0% in ~~2020.~~2022. The increase in SG&A is ~~partially~~primarily due to ~~the inclusion of SG&A from~~an increase in our ~~acquisitions of Anlin, Eco~~investments in marketing and ~~CRi in 2021. Additionally, there were increases in 2021 compared~~increased selling efforts. The increase also relates to ~~2020 in several other categories, including the acquisition~~ costs ~~additional Pandemic-response and inefficiency costs in the second half of 2021 due~~relating to the ~~2021 emergence~~redemption of ~~COVID variants, depreciation, stock-based compensation, as well as additional~~the RNCI of ECO, merger costs ~~from investing~~relating to the Masonite International Corp. ("Masonite") merger agreement, which was terminated in early 2024, and our ~~strategic selling and marketing initiatives. SG&A was also impacted by higher distribution costs on increased sales levels.~~Triple Diamond Glass facility start-up costs.

There was an impairment of our ~~WWS~~Martin trade name of ~~$8.0~~$5.5 million in ~~2020. Following~~2023. Because of post-acquisition sales levels below those used in its initial valuation, we conducted a ~~decrease~~quantitative impairment assessment of ~~19.3% in~~our Martin trade name on the ~~second~~first day of our fourth quarter of ~~2020 compared to~~2023. Because it was recently acquired, the ~~2019 second quarter, as well as continued deterioration in macro-economic conditions in our core western markets relating to~~carrying value of the ~~Pandemic, we determined to complete an interim impairment test of our WWS~~Martin trade name ~~as of October 3,~~

~~2020, which included decreases in modeling assumptions for net sales of our WWS reporting unit. Based on our revised modeling, we concluded that the~~exceeded its fair value as a result of ~~our WWS trade name was less~~the lower than ~~its carrying value, which resulted~~projected sales levels, resulting in an impairment of the Martin trade name.

There was an impairment of our ~~WWS~~WinDoor trade name of ~~$8.0~~$7.4 million in ~~2020.~~2022. Because of a then recent decrease in sales of our WinDoor brand and given the narrow excess of fair value over carrying value of our WinDoor trade name in our prior quantitative test of the WinDoor trade name as a result of these events, a quantitative impairment assessment was conducted as of the first day of our fourth quarter of 2022, resulting in an impairment of the WinDoor tradename.

~~In April 2020, the~~The Company’s management approved a plan to ~~consolidate~~exit the North Carolina market relating to its manufacturing operations in Florida, which included exiting our manufacturing facility in Orlando, Florida, where our WinDoor and Eze-Breeze products were assembled and relocate the manufacturing of those products to our Venice and Tampa, Florida plants, respectively. We ceased production at the Orlando facility during June 2020.NewSouth brand. As a result of this ~~consolidation, we recorded~~decision, the Company determined to close its NewSouth showrooms in Raleigh-Durham and Charlotte, North Carolina, which resulted in restructuring costs and charges, net, totaling ~~$4.2~~$1.7 million in 2023, which includes a gain of $0.8 million relating to the ~~first nine months ended October 3, 2020.~~forgiveness of a portion of the operating lease liability by the landlord of the Charlotte, NC location. Of the $1.7 million, after consideration of the lease liability forgiveness, restructuring costs and charges, net, includes $2.0 million of total impairments of the right-of-use assets of the leases of the Raleigh-Durham and Charlotte, North Carolina showroom facilities, and $0.4 relating to write-offs of the related leasehold improvements. The remainder represents personnel-related costs, which were paid by the end of the 2023 second quarter.

Income from operations was ~~$100.5~~$179.2 million in ~~2021,~~2023, an increase of ~~$15.8~~$18.9 million, or 11.8%, from ~~$84.7~~$160.4 million in ~~2020.~~2022. Income from operations in ~~2021~~2023 includes ~~$74.8~~$137.2 million from our Southeast segment and ~~$25.6~~$49.3 million from our Western segment, compared to ~~$85.8~~$112.6 million and ~~$11.1~~$55.2 million from our Southeast and Western segments, respectively, in ~~2020,~~2022, all after allocation of corporate operating costs in both periods. Income from operations ~~in 2020~~ was also impacted by an impairment charge of ~~$8.0~~$5.5 million ~~in the second quarter of 2020~~ relating to ~~our WWS trade name of~~ our Western segment, and restructuring costs and charges, net, of ~~$4.2~~$1.7 million relating to our ~~Florida plant consolidation actions taken~~Southeast segment in ~~the 2020 second quarter,~~2023, and ~~further adjusted~~ in ~~the 2020 third quarter,~~2022 was impacted by a $7.4 million impairment charge relating to our Southeast segment. ~~The~~Several positive factors which benefited gross profit, including a reduction in the cost of aluminum and vinyl in 2023, compared to 2022, continued improvement in operating efficiencies which began in 2022, and which have remained a focus in 2023, and an increase in capacity for production of our own glass, which we can produce at a cost lower than procuring glass from a third-party, also benefited income from operations ~~was also related to leverage from higher sales~~ in ~~2021~~2023 compared to last year, as well as continued efficiency improvements at our Western segment. However, during the second quarter of 2021, in response to increasing demand and a resulting increase in our backlog of orders, we determined to increase our manufacturing headcount across our Florida operations. While this increase in headcount positions us to better respond to increasing demand through higher production rates, it also required additional investments in training and onboarding of the new members of our manufacturing team to maintain our high standards for safety and quality as new members gain experience in their new roles. These incremental investments resulted in a reduction in operating income in 2021 as compared to the 2020. Operating income was also negatively impacted by inflationary conditions on materials, labor and material delivery costs, which continued to be prevalent in 2021. Earlier this year, we announced price increases to attempt to offset these inflationary conditions, which began to benefit us late in 2021. We also implemented a 3% surcharge on all existing orders in Florida which took effect in November 2021 to then immediately address these rising operating costs which began benefiting operating income in 2021, and we believe will continue to benefit operating income as we move through early 2022. Additionally, we announced another 6% to 12% price increase for new orders beginning November 1, 2021, that we anticipate impacting our results in the beginning of 2022. Income from operations in 2021 also includes the operating profits of our February 1, 2021, Eco acquisition, and May 2, 2021 CRi acquisition.

Interest expense was ~~$30.0~~$31.1 million in ~~2021,~~2023, an increase of ~~$2.3~~$2.2 million from ~~$27.7~~$28.9 million in ~~2020. Interest expense in 2021 includes an~~2022. The increase in interest expense ~~due~~in 2023, compared to 2022 is primarily the ~~issuance~~result of ~~the Second Additional Senior Notes totaling $60.0 million effective on January 25, 2021, which we used to finance~~ a portion of the purchase price for our investment in Eco. This increase was partially offset by a decrease in interest costs relating to the amortization of the $3.3 million premium we received on the Second Additional Senior Notes.

Additionally, we redeemed the $425.0 million of 6.75% 2018 Senior Notes due 2026, with the $575.0 million of 4.375% 2021 Senior Notes due 2029 late in the third quarter of 2021. Interest expense in 2021, particularly our 2021 fourth quarter, included the offsetting effects of interest saving due to the decrease in the interest rate on the 2021 Senior Notes due 2029, with the higher level of ~~notes outstanding.~~average borrowings under the 2016 Credit Facility, as well as a higher interest rate under the revolving facility during 2023, compared to the term loan facility during 2022.

Debt extinguishment costs totaled ~~$25.5 million~~$0.4 in ~~2021. On September 24, 2021,~~2022. In 2022, we completed the issuance of $575.0 million aggregate principal amount of 4.375% 2021 Senior Notes due 2029, issued at 100% of their principal amount. Proceeds from the 2021 Senior Notes due 2029 were used, in part, to redeem in full the $425.0 million of 2018 Senior Notes due 2026, including the related fees, costs and prepayment call premium discussed further below, prepay the outstandingrepaid our term loan borrowings under the 2016 Credit Agreement, ~~due 2024~~resulting in a write-off of $54.0 million and the related fees and costs, and finance the Anlin Acquisition. See Note 5, Acquisitions, for a discussion of the Anlin Acquisition. Redemption in-full of the $425.0 million of 2018 Senior Notes due 2026, including accrued and unpaid interest through September 27, 2021, also included a pre-payment call premium of 105.063% of face value, which totaled $21.5 million and is classified as debt extinguishment costs in the accompanying consolidated statement of operations for the year ended January 1, 2022. The remainder of debt extinguishment costs of $4.0 million is composed of $9.4 million of unamortized third-partyits remaining deferred costs and lender fees relating to the 2021 Senior Notes due 2026, including the First and Second Add-On Notes, offset by $5.4 million of unamortized premiums we received from the First and Second Add-On Notes.financing costs.

Income tax expense was ~~$9.8~~$38.0 million for ~~2021,~~2023, representing an effective tax rate of ~~21.7%~~25.7%. This compares to income tax expense of ~~$11.9~~$32.7 million for ~~2020,~~2022, representing an effective tax rate of ~~20.9%~~24.9%. Our income tax expense for ~~the year ended January 1, 2022~~2023 includes ~~$1.7~~$0.9 million relating to our 75% share of the pre-tax earnings of ~~Eco.~~Eco, compared to $1.2 million in 2022.

Income tax expense in ~~2021~~both 2023 and ~~2020~~2022 include discrete items of income tax ~~benefit relating~~benefits totaling $2.1 million in 2023, and totaled $1.1 million in 2022. Such discrete items of income tax benefits relates to excess tax benefits from the ~~exercises of stock options and~~ lapses of restrictions on stock awards ~~which totaled $861 thousand~~and from research and development tax credits true-up adjustments and, in ~~2021, and $769 thousand in 2020. The year ended January 2, 2021~~2022, also ~~included the benefit of~~includes a refund from the state of Florida, relating to excess taxes received by the state caused by the Tax Cuts and Jobs Act of 2017, which totaled $553 thousand, net of its Federal tax effect. Other discrete items included in both periods include true-ups of research and development tax credit estimates to actual tax credits claimed, and other tax return filing related true-ups.state. Excluding discrete ~~items~~components of income tax, the effective tax rates for the years ended ~~January 1,~~December 30, 2023, and December 31, 2022, ~~and January 2, 2021,~~ would have been income tax expense rates of ~~24.6%~~27.1% and ~~24.2%~~25.8%, respectively.

Net income attributable to ~~redeemable non-controlling interest~~RNCI for ~~2021~~2023 was ~~$2.3~~$1.1 million, compared to $1.5 million for 2022, and represents the share of the net income of Eco for the ~~period,~~periods, attributable to the 25% interest of Eco not acquired by the ~~Company. There was no redeemable non-controlling~~Company in February 2021. Effective on May 26, 2023, the Company redeemed the remaining 25% interest ~~in 2020.~~it previously did not own.

Our principal source of liquidity is cash flow generated by operations, supplemented by borrowing capacity under our ~~revolving credit facility,~~New Revolving Credit Facility, if ever needed. We believe our cash generating capability will continue to provide us with financial flexibility in meeting operating and investing needs. Our primary capital requirements are to fund working capital needs, and to meet required debt payments, including debt service payments on borrowings and fund capital expenditures.

The following table summarizes our cash flow results for ~~2021~~2023 and ~~2020:~~2022:


							Components of Cash Flows
	Components of Cash Flows						Year Ended
(in millions)	January 1, 2022			January 2, 2021			December 30, 2023			December 31, 2022
Cash provided by operating activities	$	63.7		$	75.5		$	196.9		$	196.4
Cash used in investing activities		(253.9	)		(114.4	)		(69.1	)		(233.9	)
Cash provided by financing activities		186.1			42.0
Cash (used in) provided by financing activities								(161.6	)		7.9

Increase (decrease) in cash and cash equivalents	$	(4.1	)	$	3.1
Decrease in cash and cash equivalents							$	(33.8	)	$	(29.6	)

Operating activities. Cash provided by operating activities was ~~$63.7~~$196.9 million for ~~2021,~~2023, compared to ~~$75.5~~$196.4 million for ~~2020.~~2022.

The ~~decrease~~increase in cash flows from operations of ~~$11.8~~$0.5 million in ~~2021~~2023 compared to ~~2020~~2022 was primarily due to the changes in operating cash flows, including an increase of ~~$244.6~~$57.8 million in collections from customers in ~~2021~~2023 compared to ~~2020,~~2022, as the result of increased sales, ~~which was partially offset by an increase~~and a decrease in payments to suppliers of ~~$153.8~~$16.3 million as the result of higher procurement of inventory, which were partially offset by an increase in personnel related disbursements of ~~$98.2~~$55.3 million due to a larger number of employees during ~~2021,~~2023, compared to ~~2020,~~2022, and an increase in debt service costs of ~~$7.4~~$2.3 million in ~~2021,~~2023, compared to ~~2020,~~2022, primarily as a result of the issuance of the 2021 Senior Notes due 2029, and the higher level of notes outstanding thereunder as compared to the recently pre-paid 2018 Senior Notes due 2026. Also, net tax payments increased ~~$3.0~~$19.1 million in ~~2021,~~2023, compared to ~~2020.~~2022. Other collections of cash and other cash activity, net, increased by ~~$6.0~~$3.1 million. Other collections of cash primarily relate to sales of scrap aluminum.

Direct cash flows from operations for ~~2021~~2023 and ~~2020~~2022 are presented below:


							Direct Operating Cash Flows
	Direct Operating Cash Flows						Year Ended
(in millions)	January 1, 2022			January 2, 2021			December 30, 2023			December 31, 2022
Collections from customers	$	1,120.6		$	876.0		$	1,594.7		$	1,536.9
Other collections of cash		12.3			6.5			18.4			15.1
Disbursements to suppliers		(720.7	)		(566.9	)		(914.8	)		(931.1	)
Personnel related disbursements		(303.8	)		(205.6	)		(430.5	)		(375.2	)
Debt service costs		(32.6	)		(25.2	)		(30.2	)		(27.9	)
Income tax payments, net		(12.2	)		(9.2	)		(40.6	)		(21.5	)
Other cash activity, net		0.1			(0.1	)		(0.1	)		0.1

Cash from operations	$	63.7		$	75.5		$	196.9		$	196.4

Inventory ~~on hand~~ as of ~~January 1, 2022,~~December 30, 2023, was ~~$91.4~~$111.8 million, ~~an increase~~a decrease of ~~$31.1~~$0.9 million from ~~January 2, 2021. The increase in inventory on had primarily relates to acquisitions during 2021.~~December 31, 2022.

Management monitors and evaluates raw material inventory levels based on the need for each discrete item to fulfill short-term requirements calculated from current order patterns and to provide appropriate safety stock. Because the majority of our products are made-to-order, we have only a small amount of finished goods and work in progress inventory. Due to these factors, we believe our inventories are not excessive, and we expect the value of such inventories will be realized.

Investing activities. Cash used in investing activities was ~~$253.9~~$69.1 million in ~~2021,~~2023, compared to ~~$114.4~~$233.9 million in ~~2020 an increase~~2022 a decrease in cash used of ~~$139.5~~$164.8 million. We ~~used $220.7~~made a final working capital payment of $0.7 million ~~of cash~~relating to ~~acquire businesses~~the Martin acquisition in ~~2021,~~2023, compared with cash used for acquisitions in ~~2020~~2022 of ~~$90.4 million..~~$188.6 million, a decrease in cash used for business combinations and acquisitions of $187.8 million. Also, in ~~2021,~~2023, we used cash of ~~$33.4~~$69.5 million for capital expenditures, compared to ~~$24.8~~$45.4 million in ~~2020,~~2022, an increase of ~~$8.6~~$24.1 million in cash ~~used.~~used for capital expenditures. Finally, in ~~2021,~~2023, we received proceeds of ~~$187 thousand~~$1.2 million from

the sales of property, plant and equipment, compared to ~~$766~~$37 thousand in ~~2019, an increase~~2022, a decrease of ~~$579 thousand~~$1.1 million in cash proceeds received from sales of property, plant and equipment.

Financing activities. Cash ~~provided by~~used in financing activities was ~~$186.1~~$161.6 million in ~~2020,~~2023, compared with cash provided of ~~$42.0~~$7.9 million in ~~2020,~~2022, an increase in cash ~~provided~~used of ~~$144.1~~$169.6 million.

In 2023, we made payments of contingent consideration relating to our acquisition of Anlin totaling $9.5 million, representing the second payment we were required to make under the Anlin purchase agreement based on their 2022 EBITDA, as defined in the agreement. Because these contingent payments were not required to be made within a reasonably short period of time after the effective date of the acquisition, we classified the portion of these payments representing the fair value of the second payment, which was $4.3 million, as a financing activity, with the difference classified within operating activities. In 2022, we made payments of contingent consideration relating to our acquisition of Anlin totaling $2.7 million, representing the first payment we were required to make under the Anlin purchase agreement based on their 2021 EBITDA, as defined in the agreement. We classified the portion of these payments representing the fair value of the first payment, which was $2.4 million, as a financing activity, with the difference classified within operating activities.

Effective on May 26, 2023, the Company exercised its call-right to purchase the remaining 25% ownership stake in Eco it previously did not own. The redemption price of the remaining 25% was calculated by the Company pursuant to the operating agreement based on the performance metric included therein, and was determined to be $37.5 million, which was agreed with by the seller. Subsequent to this redemption, the Company's ownership of Eco Enterprises is now 100%. In 2022, we ~~issued $575.0~~made a distribution to the RNCI of $1.7 million.

During 2023, we had net repayments under the New Revolving Credit Facility of $31.4 million, ~~in 4.375% 2021 Senior Notes due 2029, as well as~~which included gross borrowings of $50.0 million, partially offset by gross repayments totaling $81.4 million. We drew down $160.0 million of funds available under the New Revolving Credit Facility, using $60.0 million of ~~Second Additional Senior Notes, including a premium of $3.3 million with~~ the ~~Second Additional Notes. which provided~~ proceeds ~~from issuances of senior notes in 2021 totaling $638.3 million. Proceeds from the 2021 Senior Notes due 2029 were used, in part,~~ to redeem in full the $425.0 million of 2018 Senior Notes due 2026, plus a pre-payment call premium of 105.063% of face value, which totaled $21.5 million, classified as debt extinguishment costs in the accompanying consolidated statement of operations for 2021. We also prepaid the outstandingrepay term loan borrowings under the 2016 Credit ~~Agreement due 2024~~Agreement. We made repayments of ~~$54.0 million, and subsequently reborrowed $60.0 million in proceeds~~borrowings under the ~~2016~~New Revolving Credit ~~Agreement due 2024 used in the Anlin Acquisition. Proceeds of $63.3~~Facility totaling $83.6 million from the issuance of the $60.0 million in Second Additional Senior Notes, including a premium of $3.3 million, were used to partially fund our acquisition of Eco. In 2020, we issued the First Additional Senior Notes, which provided proceeds of $53.2 million, including a premium of $3.2 million. Proceeds from the issuance of the First Additional Senior Notes were used to partially fund our acquisition of NewSouth.

through December 31, 2022. We paid financing costs totaling ~~$10.7~~$1.5 million in ~~2021,~~2022, including financing costs relating to bank fees ~~and professional services costs~~ relating to the ~~offering and issuance~~New Revolving Credit Facility.

As further discussed below under Share Repurchase Program, during 2023, we made repurchases of ~~the 2021 Senior Notes due 2026 totaling $8.7 million, which included~~3,300,233 shares of our common stock at a ~~1.25% lender spread on the~~ total ~~principal value~~cash used of the 2021 Senior Notes due 2029, or $7.2 million, and $1.5 million of other costs. We also paid $0.6 million in financing costs relating to the Fourth Amendment of the 2016 Credit Agreement due 2024. We also paid $1.4 million in 2021 related to the issuance of the Second Additional Senior Notes, compared to $1.3 million in 2020, related to the issuance of the First Additional Senior Notes. $82.3 million.

Taxes paid relating to common stock withheld from employees to satisfy tax withholding obligations in connection with the vesting of restricted stock awards were ~~$1.6~~$7.2 million in ~~2021,~~2023, versus ~~$0.8~~$1.9 million in ~~2020. Proceeds from the exercises~~2022, an increase in cash used of ~~stock options for 2021 was $0.1 million, compared to proceeds of $0.6 million in 2020.~~ $5.4 million.

There were proceeds from stock issued under our 2019 Employee Stock Purchase Plan of ~~$0.5~~$1.1 million during ~~2021,~~2023, compared to ~~$0.3~~$0.6 million during ~~2020.~~the 2022, an increase in cash provided of $0.5 million.

2023 Share Repurchase ~~Program~~Program. . On ~~May 22, 2019, our~~February 7, 2023, the Company announced that its Board of Directors ~~authorized and~~ approved a new, share repurchase program ofwhich authorizes the Company to purchase up to ~~$30 million. The repurchases may be made in open market or private transactions~~$250.0 million of its common stock. This program permits the Company to purchase shares of its common stock from time to ~~time. Repurchases~~time through open-market purchases, in privately negotiated transactions, or by other means, including through the use of ~~shares may be made~~trading plans intended to qualify under a Rule 10b5-1 ~~plan, which would permit repurchases when~~under the ~~Company might otherwise be precluded from doing so under~~Securities Exchange Act of 1934, as amended, in accordance with applicable laws. The Company bases repurchase decisions, including the timing of repurchases, on factors such as the Company’s stock price, general economic and market conditions, the potential impact on the Company’s capital structure, the expected return on competing uses of capital such as strategic acquisitions and capital investments,securities laws and other ~~corporate considerations, as determined by management. From the inception~~restrictions. During 2023, we repurchased a total of ~~the~~3,300,233 shares under this program ~~on May 22, 2019, through December 28, 2019,we made repurchases of 393,819 shares of our common stock~~ at a total cost of ~~$5.5 million. We made no~~$82.3 million, which excludes the 1% excise tax imposed on corporate stock buy-backs by the Inflation Reduction Act of 2022. The timing and total amount of stock repurchases ~~under this~~will depend upon business, economic and market conditions, corporate and regulatory requirements, prevailing stock prices, and other considerations. The share repurchase program ~~during 2020 or 2021. The repurchase program~~had an initial term of 3 years, through February 3, 2026, and may be suspended or discontinued at any ~~time. We may~~time, and does not obligate the company to acquire any amount of common stock.

Shareholder Rights Plan. On March 30, 2023, we announced that our Board of Directors had unanimously approved the adoption of a limited-duration shareholder rights plan (the “Rights Plan”) which includes the declaration of a dividend distribution of one right (each, a “Right”) for each outstanding share of the Company’s common stock to stockholders of record as of the close of business on April 10, 2023). Each Right entitles the registered holder to purchase from the Company 0.001 of a share of Series A Participating Preferred Stock, par value $0.01 per share, of the Company at an exercise price of $90.00, subject to adjustment. The complete terms of the Rights are set forth in a Rights Agreement, dated as of March 30, 2023, between the Company and American Stock Transfer & Trust Company, LLC, as rights agent (the "Rights Agreement"). The Rights expire on the earliest of (1) March 30, 2024, unless such date is extended, or (2) the redemption or exchange of the Rights as described above. The Board adopted the Rights Plan in response to a likely accumulation of the Company's shares by a strategic investor. The intent of the Rights Plan is to reduce the likelihood that any entity, person or group gains control of the Company through open market accumulation of the Company's shares without paying all other shareholders an appropriate control premium or without providing the Board sufficient time to make ~~opportunistic purchases~~informed judgments and take actions that it believes are in the ~~future.~~best interests of its other shareholders. Under the Rights Plan, the rights will

become exercisable if an entity, person or group acquires beneficial ownership of 10% or more of the Company's outstanding common stock in a transaction not approved by the Board. In the event that the Rights become exercisable due to the triggering ownership threshold being crossed, each Right will entitle its holder (other than the person, entity or group triggering the Rights Plan, whose Rights will become void and will not be exercisable) to purchase, at the then-current exercise price, additional shares of common stock having a then-current market value of twice the exercise price of the Right.

Capital Expenditures. Capital expenditures vary depending on prevailing business factors, including current and anticipated market conditions. Due to the uncertainty surrounding the impact of the Pandemic on our operations and cash flows, late in the first quarter of 2020, and continuing through the second quarter and early third quarter of 2020, we conserved cash by reducing the level of funding of capital projects. This period of cash conservation during 2020 resulted in a decrease of $6.5 million in cash used for capital expenditures, from $31.3 million in 2019, to $24.8 million in 2020. During the third quarter of 2020 and for the remainder of the year, we resumed and caught-up on funding of capital projects, which increased our level of capital spending. This increase in capital spending continued into 2021. In ~~2021,~~2023, we spent ~~$33.4~~$69.5 million on capital expenditures, compared to ~~$24.8~~$45.4 million in ~~2020,~~2022, an increase ~~in $8.6~~of $24.1 million, primarily representing equipment purchases and facility improvements expected to support growth.

Management expects to spend between $48 million and $52 million for capital expenditures in 2022. Our capital expenditure program is geared towards making investments in capital assets targeted at increasing both gross sales and margins, but also includes capital expenditures for maintenance capital.

On September 24, 2021, we completed the issuance of $575.0 million aggregate principal amount of 4.375% senior notes (“2021 Senior Notes due 2029”), issued at 100% of their principal amount. The 2021 Senior Notes due 2029 are jointly and severally and fully and unconditionally guaranteed on a senior unsecured basis by each of the Company’s existing and future restricted subsidiaries, other than any restricted subsidiary of the Company that does not guarantee the existing senior secured credit facilities or any permitted refinancing thereof. The 2021 Senior Notes due 2029 are senior unsecured obligations of the Company and the guarantors, respectively, and rank pari passu in right of payment with all existing and future senior debt and senior to all existing and future subordinated debt of the Company and the guarantors. The 2021 Senior Notes due 2029 were offered under Rule 144A of the Securities Act, and in transactions outside the United States under Regulation S of the Securities Act, and have not been, and will not be, registered under the Securities Act.

The 2021 Senior Notes due 2029 mature on October 1, 2029. Interest on the 2021 Senior Notes due 2029 is payable semi-annually, in arrears, ~~beginning~~which began on April 1, 2022, with interest accruing at a rate of 4.375% per annum from September 24, 2021. We incurred financing costs relating to bank fees and professional services costs relating to the offering and issuance of the 2021 Senior Notes due 2029 totaling $8.7 million, which included a 1.25% lender spread on the total principal value of the 2021 Senior Notes due 2029, or $7.2 million, and $1.5 million of other costs, all of which are being amortized under the effective interest method. ~~See “Deferred Financing Costs” below.~~

As of ~~January 1, 2022,~~December 30, 2023, the face value of debt outstanding under the 2021 Senior Notes due 2029 was $575.0 million, and accrued interest ~~totaled $6.8~~was $6.3 million. Proceeds from the 2021 Senior Notes due 2029 were used, in part, to redeem in full the $425.0 million of 2018 Senior Notes due 2026, including the related fees, costs and the prepayment call premium ~~discussed further below,~~of $21.5 million, representing 5.063% of the $425.0 million face value then outstanding, prepay the outstanding term loan borrowings under the then existing 2016 Credit Agreement ~~due~~ 2024 of ~~$54.0~~$60.0 million and the related fees and costs, and finance the Anlin Acquisition in the fourth quarter of 2021. ~~See Note 5, Acquisitions, for a discussion of the Anlin Acquisition.~~

The indenture for the 2021 Senior Notes due 2029 gives us the option to redeem some or all of the 2021 Senior Notes due 2029 at the redemption prices and on the terms specified in the indenture governing the 2021 Senior Notes due 2029. The indenture governing the 2021 Senior Notes due 2029 does not require us to make any mandatory redemptions or sinking fund payments. However, upon the occurrence of a change of control, as defined in the indenture, the Company is required to offer to repurchase the notes at 101% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase. We also may make optional redemptions at various premiums including a make-whole call at the then current treasury rate plus 50 basis points prior to October 1, 2024, then 102.188% on or after August 1, ~~2021,~~2024, 101.094% on or after August 2025, then at 100.000% on or after August 1, 2026.

other restricted payments or investments; (iii) enter into agreements that restrict distributions from restricted subsidiaries; (iv) sell or otherwise dispose of assets; (v) enter into transactions with affiliates; (vi) create or incur liens; merge, consolidate or sell all or substantially all of the Company’s assets; (vii) place restrictions on the ability of subsidiaries to pay dividends or make other payments to the Company; and (viii) designate the Company’s subsidiaries as unrestricted subsidiaries. These covenants are subject to a number of important exceptions and qualifications

On August 10, 2018, we completed the issuance of $315.0 million aggregate principal amount of 6.75% senior notes (“2018 Senior Notes due 2026”), issued at 100% of their principal amount. The 2018 Senior Notes due 2026 were jointly and severally and fully and unconditionally guaranteed on a senior unsecured basis by each of the Company’s existing and future restricted subsidiaries, other than any restricted subsidiary of the Company that does not guarantee the existing senior secured credit facilities or any permitted refinancing thereof. The 2018 Senior Notes due 2026 were senior unsecured obligations of the Company and the guarantors, respectively, and ranked pari passu in right of payment with all existing and future senior debt and senior to all existing and future subordinated debt of the Company and the guarantors. The 2018 Senior Notes due 2026 were offered under Rule 144A of the Securities Act, and in transactions outside the United States under Regulation S of the Securities Act, and were not registered under the Securities Act.

On January 24, 2020, we completed an add-on issuance of $50.0 million aggregate principal amount of 6.75% 2018 Senior Notes due 2026, or the First Additional Senior Notes, issued at 106.375% of their principal amount, resulting in a premium to us of $3.2 million. The First Additional Senior Notes were part of the same issuance of, and ranked equally and formed a single series with, the 2018 Senior Notes due 2026. Proceeds from the First Additional Senior Notes, including premium, were used, together with cash on hand, to pay the $90.4 million purchase price in the NewSouth Acquisition.

On January 25, 2021, we completed a second add-on issuance of $60.0 million aggregate principal amount of 6.75% 2018 Senior Notes due 2026, or the Second Additional Senior Notes, issued at 105.5% of their principal amount, resulting in a premium to us of $3.3 million. The Second Additional Notes were part of the same issuance of, and ranked equally and form a single series with, the 2018 Senior Notes due 2026. Proceeds from the Second Additional Senior Notes, including premium, were used, together with $31.1 million in cash on hand, to pay the $94.4 million cash portion of the $100.5 million purchase price in the Eco Acquisition. The common stock portion of the purchase consideration was represented by the issuance of 357,797 shares of PGT Innovations, Inc. common stock on February 1, 2021, with a then-current value of $21.34 per share, which we discounted by an estimate of 20% for lack of marketability, as the common stock is legally restricted from being sold by the recipient for a three-year period from February 1, 2021.

The 2018 Senior Notes due 2026 were to mature on August 10, 2026. However, effective on September 27, 2021, using proceeds from the issuance of the $575.0 million 2021 Senior Notes due 2029, discussed above, we redeemed in-full the $425.0 million of 2018 Senior Notes due 2026, including accrued and unpaid interest through September 27, 2021, which totaled $4.5 million, and a pre-payment call premium of 5.063% of face value, which totaled $21.5 million and are classified as debt extinguishment costs in the accompanying consolidated statement of operations for the year ended January 1, 2022.

On February 16, 2016, we entered into the 2016 Credit ~~Agreement due 2024, among us, the lending institutions identified in~~Agreement. From 2016 to 2022, we entered into various amendments to the 2016 Credit Agreement, ~~due 2024, and Truist Financial Corporation (formerly known~~including the amendment in October 2022, as SunTrust Bank), as Administrative Agent and Collateral Agent. The 2016 Credit Agreement due 2024 establishes senior secured credit facilities in an aggregate amount of $310.0 million, consisting of a $270.0 million Term B term loan facility originally maturing in February 2022 that amortizes on a basis of 1% annually during its six-year term, and a $40.0 million revolving credit facility originally maturing in February 2021 that included a swing line facility and a letter of credit facility. Our obligations under the 2016 Credit Agreement due 2024 are, subject to exceptions, guaranteed by substantially all of our wholly-owned direct and indirect subsidiaries that are restricted subsidiaries and secured by substantially all of our assets as well as our direct and indirect restricted subsidiaries’ assets.described below.

On ~~March 16, 2018, we~~October 13, 2022, the Company entered into an amendment of ~~our 2016 Credit Agreement due 2024 (the “Second Amendment”). The Second Amendment, among other things, decreased the applicable interest rate margins for the Initial Term Loans (as defined in~~ the 2016 Credit Agreement (the “Fifth Amendment”) due ~~2024). On February 17, 2017, we entered into the first amendment to our 2016 Credit Agreement due 2024, which also resulted in decreases in the applicable margins, but which, unlike the Second~~2027. The Fifth Amendment ~~did not include any changes in lender positions.~~

$250.0 million (the “New Revolving Credit Facility”). The New Revolving Credit Facility refinances and replaces the previously existing ~~$40.0~~$80.0 million revolving credit facility under the 2016 Credit Agreement. The Company’s obligations under the 2016 Credit Agreement due ~~2024,~~2027 continue to be secured by substantially all of its and ~~includes a swing-line facility~~its direct and ~~letter of credit facility. The Initial Term A Loan was repaid~~indirect subsidiaries’ assets, and is senior in ~~full with proceed from~~position to the 2021 Senior Notes due 2029.

~~On October 25, 2021, we entered into an amendment~~Contemporaneously with the Fifth Amendment, the Company drew down $160.0 million of ~~our~~funds available under the New Revolving Credit Facility. Proceeds totaling $61.6 million from the $160.0 million drawdown were used to repay then existing term loan borrowings under the 2016 Credit Agreement ~~due 2024 ("Fourth Amendment"). The Fourth Amendment provides for, among other things, a three-year Term A loan in the aggregate maximum available amount of~~totaling $60.0 million, ~~(the "Incremental Term A Loan"), maturing in October 2024,~~plus accrued interest and fees totaling $1.6 million. As discussed below, the remaining $98.4 million of proceeds ~~from which~~ were used to fund the ~~Anlin~~cash portion of the Martin Acquisition. The ~~Fourth Amendment does not change~~Company has made net repayments of the initial $160.0 million of borrowings under the New Revolving Credit Facility totaling $115.0 million through December 30, 2023.

Interest on borrowings under the New Revolving Credit Facility is payable either quarterly or at the expiration of any ~~terms relating~~Secured Overnight Financing Rate ("SOFR") interest period applicable thereto. Borrowings under the New Revolving Credit Facility accrue interest at a rate equal to, at our option, a base rate (with a floor of 100 basis points) plus a percentage spread (ranging from 0.75% to 1.75%) based on our first lien net leverage ratio or SOFR (with a floor of 0 basis points) plus a percentage spread (ranging from 1.75% to 2.75%) based on our first lien net leverage ratio. After giving effect to the ~~Revolving Facility, under which~~Fifth Amendment, we will pay quarterly ~~fees~~commitment fee on the unused portion of the ~~revolving credit facility~~New Revolving Credit Facility equal to a percentage spread (ranging from 0.25% to 0.35%) based on our first lien net leverage ratio. The Fifth Amendment also modifies the application of the financial covenant under the 2016 Credit Agreement such that testing will occur on a quarterly basis, and requires we maintain a first lien net leverage ratio of not more than 4.00 to 1.00. We were in compliance with this covenant as of December 30, 2023.

The 2016 Credit Agreement due 2027 includes certain covenants limiting the ability of the Company and any guarantors to, (i) incur additional indebtedness; (ii) pay dividends on or make distributions in respect of capital stock or make certain other restricted payments or investments; (iii) sell or otherwise dispose of assets; (iv) enter into transactions with affiliates; (v) create or incur liens; (vi) merge, consolidate or sell all or substantially all of the Company’s assets; (vii) place restrictions on the ability of subsidiaries to pay dividends or make other payments to the Company; (viii) make investments and (ix) designate the Company’s subsidiaries as unrestricted subsidiaries. These covenants are subject to a number of important exceptions and qualifications.

As of ~~January 1, 2022, there~~December 30, 2023, borrowings outstanding under the $250.0 million New Revolving Credit Facility totaled $45.0 million, and accrued interest was $43 thousand. There were ~~$5.3~~$8.5 million in letters of credit ~~outstanding and $74.7 million available~~outstanding. Availability under the New Revolving ~~Facility. Our obligations under the 2016~~ Credit ~~Agreement due 2024 continue to be secured by substantially all of our assets, as well as our direct and indirect subsidiaries' assets, and is senior in position to the 2021 Senior Notes due 2029.~~

Facility at December 30, 2023 totaled $196.5 million. The weighted average all-in interest rate for borrowings under the ~~term-loan portion~~existing revolving credit facility of the 2016 Credit Agreement due 2027 was 7.11% as of December 30, 2023, and for borrowings under the term loan facility of the then existing 2016 Credit Agreement due 2024 was ~~2.10%. as~~6.07% at December 31, 2022.

The Martin Acquisition was financed in part with the $250.0 million available under the New Revolving Credit Facility provided by the Fifth Amendment of ~~January 1,~~our 2016 Credit Agreement due 2027, under which we drew $160.0 million on October 14, 2022, the proceeds of which were used to pay $98.4 million of the $188.5 million total fair value of consideration transferred at closing, and $61.6 million to prepay our $60.0 million existing term loans under the Fourth Amendment of our 2016 Credit Agreement due 2027, plus $1.6 million in fees, costs and accrued interest. The remainder of the total fair value of consideration transferred at closing totaling $90.1 million was ~~2.15% at January 2, 2021.~~funded with cash on hand previously generated through operations.

~~All debt-related fees,~~Activity relating to deferred financing costs, ~~and original issue discount, including those related to the revolving credit portion of the facility,~~which is classified as a reduction of the carrying value of long-term ~~debt. The activity relating to third-party fees and costs, lender fees and discount~~debt, for ~~the~~ year ended ~~January 1, 2022,~~December 30, 2023, are as follows:

Estimated amortization expense relating to third-party fees and costs, lender fees and discount for the years indicated, as of ~~January 1, 2022,~~December 30, 2023, is as follows:


(in thousands)	Total		Total
2022	$	1,233
2023		1,282
2024		1,282	$	1,366
2025		1,083		1,442
2026		1,114		1,466
2027				1,440
2028				1,222
Thereafter		3,351		962

Total	$	9,345	$	7,898

The contractual future maturities of long-term debt outstanding, as of ~~January 1, 2022,~~December 30, 2023, are as follows (at face value):


(in thousands)	Total		Total
2021	$	—
2022		—
2023		—
2024		60,000	$	—
2025		—		—
2026				—
2027				45,000
2028				—
Thereafter		575,000		575,000

Total	$	635,000	$	620,000

(1) Effective on September 24, 2021, the Company completed the issuance of $575.0 million aggregate principal amount of 4.375% senior notes due October 1, 2029, issued at 100% of their principal amount. The proceeds from issuance of the new senior notes were used to finance the repayment of the then outstanding aggregate principal amount of $425.0 million of 6.75% senior notes 2026, which required payment of a 5.063% call-premium totaling $21.5 million, lender fees of 1.25% of the face value of the 2021 Senior Notes due 2029 totaling $7.2 million, accrued interest on the then outstanding senior notes and term loan totaling $4.5 million, and various costs of the senior note offering and the Anlin acquisition. The remainder of the proceeds of the new senior notes held as cash on hand, together with $60.0 million of new borrowings under our 2016 Credit Agreement due 2024, were subsequently used on October 25, 2021 for the Anlin Acquisition totaling $114.2 million. Any remaining unused proceeds from issuance of the new $575.0 million of senior notes will be held as operating cash on hand and used to pay, if any, the contingent consideration relating to the Anlin Acquisition. See Note 5. Acquisitions, in Item 8. Financial Statements and Supplementary Data, for further discussion of the contingent consideration relating to the Anlin Acquisition.

(2) Effective on August 10, 2018, the Company completed the issuance of $315.0 million aggregate principal amount of 6.75% senior notes due August 10, 2026, issued at 100% of their principal amount. The senior notes were issued to finance, together with cash on hand, the WWS acquisition. On January 24, 2020, we issued an additional $50.0 million add-on senior notes, issued at 106.375% of their principal amount, to finance, together with cash on hand, the $90.4 million acquisition of NewSouth. Effective on January 25, 2021, we issued an additional $60.0 million add-on senior notes, issued at 105.5% of their principal amount, to finance together with $94.4 million of cash on hand, and fair value of $6.1 million in Company common stock, the $100.5 million acquisition of our 75% stake in Eco. See note (1) above for a discussion of the repayment of the 2018 Senior Notes due 2026 totaling $425.0 million.

(3) Effective on October 25, 2021, the Company entered into the fourth amendment of the 2016 Credit Agreement due 2024. We borrowed a $60.0 million incremental term loan in connection with this amendment, the proceeds from which were used in combination with proceeds remaining under the 2021 Senior Notes due 2029 for the Anlin Acquisition. See note (1) above for further discussion.

~~(4)~~ Fees, costs, ~~premium~~ and discount represents third-party fees, lender fees, other debt-related costs, and original issue premium and discount, recorded as a net reduction of the carrying value of the debt and are amortized over the lives of the debt instruments to which they relate under the effective interest method.

MITER Merger Agreement. On January 17, 2024, the Company and MITER Brands™ (“MITER”), a nationwide manufacturer of precision-built windows and doors, announced they entered into a definitive merger agreement for MITER to acquire all of the Company's outstanding shares at a price of $42.00 per share in cash, or an enterprise value of approximately $3.1 billion. The purchase price represents a premium of 60% the Company's unaffected closing share price on October 9, 2023, the last trading day prior to the public disclosure of a proposal for the acquisition of the Company. The merger agreement has been unanimously approved by the boards of directors of both companies. The transaction is expected to be financed in part by an equity investment from Koch Equity Development LLC, the principal investment and acquisition arm of Koch Industries, Inc., and a current investor in MITER. The Company also announced that it had terminated its merger agreement with Masonite International Corp. (“Masonite”) dated December 17, 2023.

MITER and the Company entered into their agreement after the Company's Board unanimously determined that MITER’s proposal constituted a “Superior Proposal” as defined in its merger agreement with Masonite, dated December 17, 2023. We notified Masonite of our determination and Masonite waived its right to improve the terms of its offer. In accordance with our merger agreement with Masonite, concurrent with the signing of the definitive merger agreement with MITER, we terminated our merger agreement with Masonite and MITER, on behalf of the Company, paid the termination fee of $84.0 million due to Masonite. MITER’s transaction with the Company is expected to close by mid-year 2024, subject to approval by the shareholders of the Company, regulatory approval, including satisfaction of the antitrust provisions of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), and customary closing conditions. The 30-day waiting period under the HSR Act, in connection with the Merger expired at 11:59 p.m. on February 22, 2024. The expiration of the HSR Act waiting period satisfies one of the conditions to the closing of the Merger. MITER has obtained commitment letters for the financing necessary to complete the transaction, which is not subject to a financing condition. Upon completion of the transaction, the Company will become a privately held subsidiary of MITER and its common stock will no longer be traded on the New York Stock Exchange.

The accompanying financial statements have been prepared under the assumption that the Company will continue as a going concern, and no adjustments have been made to reflect the effects, if any, from entering into the aforementioned merger agreement with MITER.

In preparing our consolidated financial statements, we follow U.S. generally accepted accounting principles. These principles require us to make certain estimates and apply judgments that affect our financial position and results of operations.

On a regular basis, we review the accounting policies, assumptions, estimates and judgments to ensure that our consolidated financial statements are presented fairly and in accordance with GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such difference could be material. Our significant accounting policies are discussed in Item 8, Note 2. The following is a summary of our more significant accounting estimates that require the use of judgment in preparing the financial statements.

~~Valuation of Trade Names and Customer Relationships in Business Combinations~~

The assets and liabilities of acquired businesses are recorded under the acquisition method of accounting at their estimated fair values at the dates of acquisition. Goodwill represents costs in excess of fair values assigned to the underlying identifiable net assets of acquired businesses. Intangible assets acquired in business combinations consist of trade names, developed technology, customer relationships, and other intangible assets. The fair value of the trade name intangible assets are determined utilizing the relief from royalty method ("RFRM") which is a form of the income approach. Under the RFRM, a royalty rate based on observed market royalties is applied to projected revenue supporting the trade name and discounted to present value using an appropriate discount rate. The fair values of customer relationships are determined using the multi-period excess earnings method ("MPEEM"), which is also a form of the income approach. Under the MPEEM, the expected net cash flow an asset will generate, is discounted to present value using an appropriate discount rate.

We applied the RFRM to the valuation of trade names and MPEEM to customer relationships for acquisitions done during 2021, for which the most significant intangible assets identified were the Eco and Anlin trade names and customer relationships. Specific to these intangible assets, our estimates of projected revenue included forecast revenue growth rates, estimated existing customer retention rates, operating expense estimates and other estimates regarding contributory asset charges that required judgment by management. Actual results can differ from our estimates, requiring adjustments to our assumptions. The estimated fair value of identifiable intangible assets acquired in connection with the Eco Acquisition was $74.3 million, which included its trade name with an estimated fair value of $34.9 million, and total customer relationships of $39.4 million. The estimated fair value of identifiable intangible assets acquired in connection with the Anlin Acquisition was $77.8 million, which included its trade name with an estimated fair value of $35.4 million and its customer relationship asset of $42.1 million.

We disclosed the Company’s accounting policy for Goodwill and Trade Names under Item 8, Note 2 – Summary of Significant Accounting Policies. We perform our annual goodwill and indefinite-lived intangible asset impairment testing on the first day of our fiscal fourth quarter of each year, and at interim periods if needed based on occurrence of triggering events.

~~Given the general deterioration~~Because of post-acquisition sales levels below those used in ~~economic~~its initial valuation, we determined such conditions represented a triggering event and ~~market conditions associated with the COVID-19 pandemic, and the narrow excess of fair value over carrying value of our WinDoor and WWS trade names as described in 2019, the Company determined it~~that we should complete ~~interim~~a quantitative impairment tests of its WinDoor and WWS trade names as of the end of the Company’s first quarter of 2020. These interim impairment tests did not indicate that impairments of those assets existed at that time. Following a decrease of 19.3% in net sales in the second quarter of 2020, compared to the second quarter of last year, as well as continued deterioration in macro-economic conditions in our core western markets relating to the COVID-19 pandemic, we determined to complete a second interim impairment test of our ~~WWS~~Martin trade name as of ~~July 4, 2020. For this second interim~~our annual impairment test ~~we further decreased our modeling assumptions for net sales~~date of the first day of our ~~WWS reporting unit for our 2020 fiscal year based on a reassessment~~fourth quarter of our key assumptions in our modeling, including an updated assessment of macro industry growth in our WWS reporting unit’s key markets. We also decreased our 2021 growth rate assumption as we expect the challenging macro-economic conditions in our core western markets to continue during 2021.2023. Based on our revised modeling, which included our assumptions regarding future revenue, which we consider to be a Level 3 input, using the relief-from-royalty method, we concluded that the fair value of our ~~WWS~~Martin trade name was less than its carrying value, which resulted in an impairment of our ~~WWS~~Martin trade name of ~~$8.0~~$5.5 million in our ~~second~~fourth quarter of ~~2020. Sales for our WWS reporting unit for~~2023. As of December 30, 2023, and December 31, 2022, the ~~2020 fiscal year exceeded our modeling assumptions used during our second impairment test~~carrying value of our ~~WWS~~Martin trade name aswas $18.5 million and $24.0 million, respectively.

For our other indefinite-lived trade names, we completed qualitative assessments of ~~July 4, 2020. As such, we performed a qualitative assessment as of~~these assets on the first day of our ~~2020~~ fourth quarter of 2023. These qualitative assessments included an evaluation of relevant events and ~~concluded~~circumstances that ~~it was not necessary~~existed at the date of our assessment. Those events and circumstances included conditions specific to ~~perform a Step 1 impairment test~~our other indefinite-lived trade names, such as the industry in which we use these other indefinite-lived trade names, our competitive environment, the availability and costs of raw materials and labor, the financial performance of our Company, and factors related to the markets in which our Company operates. We also considered that, for our ~~WWS~~other indefinite-lived trade ~~name indefinite-lived intangible assets as~~names, no new ~~triggering events or conditions~~impairment indicators were ~~identified. During 2021, WWS enjoyed organic growth and operational improvements, and there were no new triggering events or conditions~~ identified ~~as of~~since the ~~first days~~dates of our ~~2021 fourth quarter. Therefore,~~prior assessments. Based on these assessments, we ~~completed a qualitative assessment of our WWS trade name, which indicated~~concluded that it is more likely than not that the fair ~~value~~values of our ~~WWS~~other

indefinite-lived trade names exceed their carrying values. As of December 30, 2023, and December 31, 2022, excluding the Martin and WinDoor trade name, ~~exceeds it carrying value. As of January 1, 2022, and January 2, 2021,~~ the carrying ~~value~~values of ~~our WWS~~other indefinite-lived trade ~~name was $65.0~~names were $201.0 million and ~~$65.0~~$201.0 million, respectively.

~~Reference Rate Reform~~Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures

In ~~March 2020,~~November 2023, the ~~FASB~~Financial Accounting Standards Board (FASB) issued ~~ASU 2020-04, “Reference Rate Reform~~Accounting Standard Update (ASU) No. 2023-07, Segment Reporting (Topic ~~848)~~280): ~~Facilitation~~Improvements to Reportable Segment Disclosures, which requires a public entity to disclose significant segment expenses and other segment items on an annual and interim basis and provide in interim periods all disclosures about a reportable segment’s profit or loss and assets that are currently required annually. Additionally, it requires a public entity to disclose the title and position of the ~~Effects of Reference Rate Reform on Financial Reporting.”~~Chief Operating Decision Maker (CODM). The ASU ~~2020-04~~does not change how a public entity identifies its operating segments, aggregates them, or applies the quantitative thresholds to determine its reportable segments. The new standard is ~~intended~~effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. A public entity should apply the amendments in this ASU retrospectively to ~~provide temporary optional expedients and exceptions to U.S. GAAP guidance on contract modifications and hedge accounting to ease~~all prior periods presented in the financial reporting burdens related to the expected market transition from the London Interbank Offered Rate (LIBOR) and other interbank offered rates to alternative reference rates. The transition to new reference interest rates will require certain contracts to be modified and ASU 2020-04 is intended to mitigate the effects of this transition. This new guidance was effective upon issuance ofstatements. We expect this ASU to only impact our disclosures with no impacts to our results of operations, cash flows and financial condition.

In December 2023, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) 2023-09, “Income Taxes - Improvements to Income Tax Disclosures” requiring enhancements and further transparency to certain income tax disclosures, most notably the tax rate reconciliation and income taxes paid. This ASU is effective for ~~contract modifications and hedging relationships~~fiscal years beginning after December 15, 2024 on a prospective ~~basis. We do not expect this standard to have a material impact on our consolidated financial statements.~~

Looking ahead into 2022, we believe economic factors that impact our business currently are stable in all of our major markets. We have seen robust demand in our core geographies over the past eighteen months,basis and we believe that the substantial backlog we have at the end of 2021, which grew to $355.9 million at January 1, 2022, from $199.5 million at January 2, 2021, an increase of 78.4%, which included 60.7% of legacy growth, positions us for solid sales growth in 2022. We have been able to increase production to meet this increased demand in large part because of actions taken throughout 2021 to increase hiring, implement operations improvements, expand our manufacturing footprint, and manage our supply of key inputs such as glass and aluminum. Increased orders booked during the year translated into higher product shipments as we worked through, and continue to work through our backlog and decrease lead times. We are well positioned to meet strong demand across our key markets and continue our growth trajectory in 2022.

We expect 2022 full-year sales to range between $1.35 billion and $1.45 billion, representing an increase of between 16% and 25%, as compared to 2021. This estimated sales range for 2022 includes our Eco Acquisition at 100% of its sales amount.

~~We believe the following factors, which are not all inclusive, may impact our gross profit and gross margin in 2022:~~

• Our gross margin percentages are influenced by total sales due to operating leverage of fixed costs, and also by product mix. We expect product mix to show more repair and remodel sales in 2022 due to acquisitions in 2021, whose sales are weighted more towards the repair and remodel channel.

• During 2021, our gross profit and gross margin percentage were negatively impacted by inflationary pressure on our manufacturing inputs, including materials and labor. We have taken actions to attempt offset these factors, including previously communicated pricing actions throughout 2021, including 6 to 12 percent price increases for new orders that originated after November 1st. These actions already are contributing to top line growth which we believe will contribute to improvements in gross profit and gross margin in 2022. But inflationary headwinds continue to exist in 2022. As such, our focus in 2022 will be to continue to take actions to further improve operating efficiencies, including material usage and labor cost reductions.

~~• Inflationary conditions continue to impact aluminum prices, which~~retrospective application is one of our most significant raw materials. During the late summer of 2021, the price of aluminum hit all-time high spot prices, and at the time of the filing of this Annual Report on Form 10-K, the spot price of aluminum is near those all-time high levels. While we engage in a program of hedging our purchases of aluminum using cash flow derivative products to help us stabilize the cost of aluminum in our manufacturing process, our uncovered aluminum purchases have been and continue to be impacted by the increasing cost of the key raw material input. We believe there is uncertainty surrounding the future price of aluminum during 2022, and that volatility in the price of aluminum could be significant. As of the beginning of 2022, we were hedged for approximately 44% of our anticipated aluminum needs for 2022, at an average price of $1.11 per pound, which is an average representing the cash price per pound, excluding the delivery component for the Midwest Premium, and we were hedged for approximately 33% of the Midwest Premium delivery component needs for 2022, at an average price of $0.12 per pound.

• Our gross profit and gross margin are also influenced by labor costs. During 2021, we invested in increasing our headcount to meet the increase in demand in all of our major markets. While the short-term impacts of these investments in headcount increases result in negative margin effects due to onboarding and training costs, as well as increased wages needed to attract sufficient headcount in this incredibly tight labor market, we believe of our labor force has become more tenured and, therefore, labor costs have begun to normalize as efficiencies are achieved. However, we believe a strong jobs environment throughout the United States will continue to result in a limited labor pool. We expect a tight labor market to continue during 2022, which we believe may result in operational efficiencies resulting from an experienced, trained workforce to be partially offset by the possibility for turnover due to this being an employee's job market.

This expense category will be affected by the inclusion of the SG&A of Anlin for the full year of 2022, including non-cash amortization depending on the level of amortizable intangible assets we have acquired.permitted. We are currently inevaluating the ~~process~~impact of ~~estimating~~ the ~~fair values~~adoption of acquired intangible assets. We expect to leverage fixed SG&A on anticipated higher sales in 2022, compared to 2021, and to continue to look for areas within SG&A to drive efficiencies. However, we expect to continue to invest in strategic marketing initiatives and advertising, especially at our NewSouth direct-to-consumer business which relies heavily on outreach to consumers. As such, savings from SG&A efficiencies could be more than offset by increases in spending on strategic programs which we believe will provide a favorable return on investment. We have also seen the effects of inflationary pressure on our distribution costs as fuel prices continue to rise and affect the cost of operating our fleet. As previously mentioned, we have increased prices in an attempt to address these inflationary pressures, but such benefits could be more than offset by rising prices, including fuel prices.this standard.

~~Including the impact on depreciation and amortization from our Anlin Acquisition, depreciation and amortization is estimated to be approximately $55 million in 2022.~~

During 2022, we refinanced our $425.0 million of 6.75% 2018 Senior Notes due 2026 with our $575.0 million of 4.375% 2021 Senior Notes due 2029, incremental proceeds from which were used to finance the cash portion of the purchase price for the Anlin Acquisition. Additionally, we increased our borrowings under the 2016 Credit Agreement from $54.0 million to $60.0 million in October 2021 in connection with the Anlin Acquisition, without any impact to the borrowing rate thereunder. Although the level of our outstanding indebtedness increased to $635.0 million at January 1, 2022, from $479.0 at January 2, 2021, we expect that the increasing impact on interest expense from the higher level of indebtedness will be more than offset by the decrease in interest rate on our outstanding senior notes. We believe interest expense on our long-term debt will be approximately $28 million in 2021, including an estimated $1 million of non-cash amortization of net deferred financing costs.

We expect to continue to be profitable in 2022, and thus, we believe that we will incur income tax expense at a combined Federal and state effective rate of between approximately 25% to 26%. This rate is based on the corporate income tax rate of 21%, plus a blended statutory state rate, taking into consideration the increase in income tax rate in Florida from 3.535% in 2021 to 5.5% through 2022.

We had $96.1 million of cash on hand as of January 1, 2022. During 2022, we expect to continue to generate sufficient cash from operations to service the interest requirements on our debt, cover our operating expenses, and spend between $48 million and $52 million for capital expenditures in 2022. As a result of the Fourth Amendment, we have no further mandatory required payments remaining until the maturity in October 2024 of our 2016 Credit Agreement due 2024 but may continue to make voluntary prepayments in the future as our cash generation and other relevant factors permit. However, no assurances can be given that cash from operations will be sufficient for some or all these purposes. We currently have $74.7 million of availability under the Revolving Facility portion of the 2016 Credit Agreement due 2024. The Revolving Facility also expires in October 2024.

We utilize derivative financial instruments to hedge price movements in aluminum materials used in our manufacturing process and to hedge the delivery component of our aluminum needs, known as the Midwest Transaction Premium (“MTP”). AsHowever, as of ~~January 1, 2022,~~December 30, 2023, we ~~are covered for approximately 44% of our anticipated~~had in place minimal coverage through aluminum ~~needs in 2022 at an average price of $1.11 per pound. These calculations are based only on the LME price of aluminum~~forward contracts, and ~~excludes an estimate~~no coverage for the MTP ~~which we hedge separately. As~~component. Accordingly, as of ~~January 1, 2022,~~the date of this report, we are ~~covered~~substantially not hedged for ~~approximately 33% of our anticipated MTP costs in 2022 at an average price of $0.12 per pound.~~

Regarding our aluminum hedging instruments for the purchase of aluminum, as of January 1, 2022, a 10% decrease in the price of aluminum per pound would decrease the fair value of our forward contracts of aluminum by an estimated $3.7 million. This calculation utilizes our actual commitment of 30.7 million pounds under contract (to be settled throughout December 2022) and the market price of aluminum as of January 1, 2022. This calculation is based only on the LME price of aluminum and excludes an estimate for the MTP. Regarding our MTP contracts for hedging of the delivery componentportions of our aluminum needs, as of January 1, 2022, a 10% decrease in the Platts MW US Transaction price per pound would decrease the fair value of our MTP contracts an estimated $0.7 million. This calculation utilizes our actual commitment of 23.5 million pounds under contract (to be settled throughout December 2022) and the then current Platts MW US Transaction price per pound as of January 1, 2022.or delivery needs.

We experience changes in interest expense when market interest rates change. Changes in our debt could also increase these risks. Based on debt outstanding with a variable rate as of the date of filing of this Annual Report on Form 10-K of ~~$60.0~~$45.0 million, a 100 basis-point increase in interest rate would result in approximately ~~$0.6~~$0.5 million of additional interest costs annually.

We have audited the accompanying consolidated balance ~~sheet~~sheets of PGT Innovations, Inc. (the Company) as of ~~January 1,~~December 30, 2023 and December 31, 2022, the related consolidated statements of operations, comprehensive income, ~~shareholders'~~shareholders’ equity, and cash flows for each of the three fiscal years in the period ended ~~January 1, 2022,~~December 30, 2023, and the related notes and the financial statement schedule listed in the Index at Item 15(a) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at ~~January 1,~~December 30, 2023 and December 31, 2022, and the results of its operations and its cash flows for each of the three fiscal years in the period ended ~~January 1, 2022,~~December 30, 2023, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of ~~January 1, 2022,~~December 30, 2023, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated ~~March 1, 2022~~February 23, 2024 expressed an unqualified opinion thereon.

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our ~~audit.~~audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our ~~audit~~audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our ~~audit~~audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our ~~audit~~audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our ~~audit provides~~audits provide a reasonable basis for our opinion.

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.


		Year Ended								Year Ended
		January 1,			January 2,		December 28,			December 30,			December 31,			January 1,
		2022			2021		2019			2023			2022			2022

Net sales		$	1,161,464		$	882,621	$	744,956		$	1,504,241		$	1,491,954		$	1,161,464
Cost of sales			757,965			561,297		484,588			913,600			921,285			757,965

Gross profit			403,499			321,324		260,368			590,641			570,669			403,499

Selling, general and administrative expenses			303,043			224,386		176,312			404,193			402,886			303,043
Impairment of trade name			—			8,000		—			5,500			7,423			—
Restructuring costs and charges			—			4,227		—
Restructuring costs and charges, net											1,722			—			—

Income from operations			100,456			84,711		84,056			179,226			160,360			100,456

Interest expense, net			30,029			27,719		26,417			31,077			28,879			30,029
Debt extinguishment costs			25,472			—		1,512			—			410			25,472

Income before income taxes			44,955			56,992		56,127			148,149			131,071			44,955

Income tax expense			9,759			11,884		12,439			38,010			32,666			9,759

Net income			35,196			45,108		43,688			110,139			98,405			35,196

Less: Net income attributable to redeemable non-controlling interest			(2,318	)		—		—
Less: Net income attributable to redeemable non-controlling interest ("RNCI")											(1,101	)		(1,523	)		(2,318	)

Net income attributable to the Company		$	32,878		$	45,108	$	43,688		$	109,038		$	96,882		$	32,878

Calculation of net income per common share attributable to common shareholders:	Calculation of net income per common share attributable to common shareholders:								Calculation of net income per common share attributable to common shareholders:
Net income attributable to the Company		$	32,878		$	45,108	$	43,688		$	109,038		$	96,882		$	32,878
Change in redemption value of redeemable non-controlling interest			(6,081	)		—		—
Change in redemption value of RNCI											(1,637	)		2,000			(6,081	)
Net income attributable to common shareholders		$	26,797		$	45,108	$	43,688		$	107,401		$	98,882		$	26,797

Net income per common share attributable to common shareholders:
Basic		$	0.45		$	0.77	$	0.75		$	1.84		$	1.65		$	0.45
Diluted		$	0.45		$	0.76	$	0.74		$	1.83		$	1.64		$	0.45

Weighted average number of common shares outstanding:
Basic			59,518			58,887		58,346			58,363			59,926			59,518
Diluted			60,058			59,360		59,150			58,700			60,319			60,058

The accompanying notes are an integral part of these consolidated financial statements.


							December 30,			December 31,
	January 1,			January 2,			2023			2022
	2022			2021
ASSETS
Current assets:
Cash and cash equivalents	$	96,146		$	100,320		$	32,708		$	66,548
Accounts receivable, net		141,221			92,844			117,617			160,107
Inventories		91,440			60,317			111,781			112,672
Contract assets, net		55,239			28,723			37,733			47,919
Prepaid expenses		8,727			8,357			11,586			11,763
Other current assets, net		28,985			11,111
Other current assets								16,860			16,532
Total current assets		421,758			301,672			328,285			415,541
Property, plant and equipment, net		185,266			135,155			238,126			208,354
Operating lease right-of-use asset, net		91,162			38,567			124,012			104,121
Intangible assets, net		394,525			256,507			415,245			447,052
Goodwill		364,598			329,695			462,630			460,415
Other assets, net		3,301			925			9,581			4,766

Total assets	$	1,460,610		$	1,062,521		$	1,577,879		$	1,640,249

LIABILITIES, REDEEMABLE NON-CONTROLLING INTEREST, AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	40,021		$	23,469		$	40,630		$	43,727
Accrued liabilities		82,660			60,875			73,190			125,234
Current portion of operating lease liability		13,180			6,132			20,368			16,393
Total current liabilities		135,861			90,476			134,188			185,354
Long-term debt		625,655			412,098			612,102			642,134
Operating lease liability, less current portion		83,903			35,130			114,030			95,159
Deferred income taxes		37,489			28,329			52,685			47,407
Other liabilities		11,742			11,354			5,007			7,459
Total liabilities		894,650			577,387			918,012			977,513

Commitments and contingencies		—			—

Redeemable non-controlling interest		36,863			—			—			34,721

Shareholders' equity:
Preferred stock; par value $.01 per share; 10,000 shares authorized; NaN outstanding		—			—
Common stock; par value $.01 per share; 200,000 shares authorized; 63,516 and 62,542 shares issued and 59,696 and 58,999 shares outstanding at January 1, 2022 and January 2, 2021, respectively		635			625
Preferred stock; par value $.01 per share; 10,000 shares authorized; none outstanding								—			—
Common stock; par value $.01 per share; 200,000 shares authorized; 64,395 and 63,940 shares issued and 57,188 and 59,912 shares outstanding at December 30, 2023 and December 31, 2022, respectively								644			639
Additional paid-in-capital		433,347			420,202			450,881			442,116
Accumulated other comprehensive income		7,006			2,720			191			223
Retained earnings		106,398			79,896			311,095			204,891
Treasury stock at cost		(18,289	)		(18,309	)
Treasury stock at cost (6,061 shares and 2,760 shares at December 30, 2023 and December 31, 2022, respectively)								(102,944	)		(19,854	)
Total shareholders' equity		529,097			485,134			659,867			628,015

Total liabilities, redeemable non-controlling interest, and shareholders' equity	$	1,460,610		$	1,062,521		$	1,577,879		$	1,640,249

The accompanying notes are an integral part of these consolidated financial statements.


	Year Ended									Year Ended
	January 1,			January 2,			December 28,			December 30,			December 31,			January 1,
	2022			2021			2019			2023			2022			2022
Cash flows from operating activities:
Net income	$	35,196		$	45,108		$	43,688		$	110,139		$	98,405		$	35,196
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		30,487			24,014			18,876			35,991			34,048			30,487
Amortization		21,082			18,825			15,856			26,307			26,150			21,082
Impairment of trade name		—			8,000			—			5,500			7,423			—
Asset impairment charges											—			2,131			—
Non-cash portion of restructuring costs and charges		—			2,442			—			1,679			—			—
Provision for allowance for credit losses		3,834			996			1,553			3,132			10,979			3,834
Stock-based compensation		7,819			5,458			3,923			12,240			9,670			7,819
Amortization and write-offs of deferred financing costs		978			1,206			1,674			1,320			1,242			978
Debt extinguishment costs		25,472			—			1,512			—			410			25,472
Deferred income taxes		7,632			(593	)		4,410			6,752			(11,340	)		7,632
Loss (gain) on sales of assets		261			(291	)		143			406			(240	)		261
Change in operating assets and liabilities (net of acquisition effects):
Accounts receivable		(34,390	)		(13,775	)		12,682
Accounts receivable, net											37,452			(20,622	)		(34,390	)
Inventories		(15,984	)		(14,793	)		815			527			(12,017	)		(15,984	)
Contract assets, net, prepaid expenses, other current and other assets		(5,958	)		(11,342	)		(4,429	)		26,158			12,826			(5,958	)
Accounts payable and accrued liabilities		(12,750	)		10,240			(19,487	)
Accounts payable, accrued and other liabilities											(70,717	)		37,309			(12,750	)
Net cash provided by operating activities		63,679			75,495			81,216			196,886			196,374			63,679

Cash flows from investing activities:
Purchases of property, plant and equipment		(33,424	)		(24,800	)		(31,268	)		(69,509	)		(45,377	)		(33,424	)
Business acquisitions		(220,676	)		(90,368	)		—
Proceeds from disposals of assets		187			766			71
Investment in and acquisition of business											(744	)		(188,580	)		(220,676	)
Proceeds from sales of assets											1,167			37			187
Net cash used in investing activities		(253,913	)		(114,402	)		(31,197	)		(69,086	)		(233,920	)		(253,913	)

Cash flows from financing activities:
Payment of fair value of contingent consideration in Anlin Acquisition											(4,348	)		(2,362	)		—
Redemption of redeemable non-controlling interest											(37,459	)		—			—
Proceeds from amounts drawn under revolving credit facility											50,000			160,000			—
Payments of borrowing under revolving credit facility											(81,352	)		(83,648	)		—
Proceeds from issuance of senior notes		638,300			53,188			—			—			—			638,300
Payments of senior notes		(425,000	)		—			—			—			—			(425,000	)
Payment of call-premium on redemption of senior notes		(21,518	)		—			—			—			—			(21,518	)
Proceeds from issuance of term loan debt		60,000			—			64,000			—			—			60,000
Payments of term loan debt		(54,000	)		(10,000	)		(64,138	)		—			(60,000	)		(54,000	)
Payments of financing costs		(10,675	)		(1,266	)		(854	)		—			(1,526	)		(10,675	)
Purchases of treasury stock under repurchase program		—			—			(5,550	)
Purchases of treasury stock relating to tax withholdings on employee equity awards		(1,648	)		(815	)		(505	)
Purchases of treasury stock under share repurchase program											(82,349	)		(1,565	)		—
Income taxes paid from stock withheld relating to vested equity awards											(7,240	)		(1,888	)		(1,648	)
Proceeds from exercise of stock options		138			572			1,562			—			—			138
Distribution to redeemable non-controlling interest											—			(1,665	)		—
Proceeds from issuance of common stock under ESPP		463			305			59			1,108			602			463
Net cash provided by (used in) financing activities		186,060			41,984			(5,426	)
Net (decrease) increase in cash and cash equivalents		(4,174	)		3,077			44,593
Net cash (used in) provided by financing activities											(161,640	)		7,948			186,060
Net decrease in cash and cash equivalents											(33,840	)		(29,598	)		(4,174	)
Cash and cash equivalents at beginning of year		100,320			97,243			52,650			66,548			96,146			100,320
Cash and cash equivalents at end of year	$	96,146		$	100,320		$	97,243		$	32,708		$	66,548		$	96,146

The accompanying notes are an integral part of these consolidated financial statements.


										Accumulated			Retained																		Accumulated
	Common stock						Additional			Other			Earnings									Common stock						Additional			Other
	Shares						Paid-in			Comprehensive			(Accumulated			Treasury						Shares						Paid-in			Comprehensive			Retained			Treasury
	Outstanding			Amount			Capital			Income (Loss)			Deficit)			Stock			Total			Outstanding			Amount			Capital			Income (Loss)			Earnings			Stock			Total
Balance at December 29, 2018		58,081,540		$	607		$	409,661		$	(3,065	)	$	(8,900	)	$	(12,759	)	$	385,544
Grants of restricted stock		—			6			(6	)		—			—			—			—
Vesting of restricted stock		164,226			—			—			—			—			—			—
Forfeitures of restricted stock		—			(1	)		1			—			—			—			—
Purchases of treasury stock		(428,059	)		—			—			—			—			(6,055	)		(6,055	)
Retirement of treasury stock		—			—			(505	)		—			—			505			—
Stock-based compensation		—			—			3,923			—			—			—			3,923
Exercise of stock options		682,931			7			1,555			—			—			—			1,562
Common stock issued under ESPP		4,096			—			59			—			—			—			59
Net income		—			—			—			—			43,688			—			43,688
Other comprehensive income, net of tax expense of $974		—			—			—			2,827			—			—			2,827
Balance at December 28, 2019		58,504,734		$	619		$	414,688		$	(238	)	$	34,788		$	(18,309	)	$	431,548
Grants of restricted stock		—			7			(7	)		—			—			—			—
Vesting of restricted stock		219,977			—			—			—			—			—			—
Forfeitures of restricted stock		—			(3	)		3			—			—			—			—
Purchases of treasury stock		(51,479	)		—			—			—			—			(815	)		(815	)
Retirement of treasury stock		—			(1	)		(814	)		—			—			815			—
Stock-based compensation		—			—			5,458			—			—			—			5,458
Exercise of stock options		284,353			3			569			—			—			—			572
Common stock issued under ESPP		41,126			—			305			—			—			—			305
Net income		—			—			—			—			45,108			—			45,108
Other comprehensive income, net of tax expense of $970		—			—			—			2,958			—			—			2,958
Balance at January 2, 2021		58,998,711		$	625		$	420,202		$	2,720		$	79,896		$	(18,309	)	$	485,134			58,998,711		$	625		$	420,202		$	2,720		$	79,896		$	(18,309	)	$	485,134
Grants of restricted stock		—			7			(7	)		—			—			—			—			—			7			(7	)		—			—			—			—
Vesting of restricted stock		312,982			—			—			—			—			—			—			312,982			—			—			—			—			—			—
Forfeitures of restricted stock		—			(1	)		1			—			—			—			—			—			(1	)		1			—			—			—			—
Issuance of treasury stock		4,600			—			—			—			(20	)		20			—			4,600			—			—			—			(20	)		20			—
Purchases of treasury stock		(73,105	)		—			—			—			—			(1,648	)		(1,648	)
Stock withheld in lieu of taxes																							(73,105	)		—			—			—			—			(1,648	)		(1,648	)
Retirement of treasury stock		—			(1	)		(1,372	)		—			(275	)		1,648			—			—			(1	)		(1,372	)		—			(275	)		1,648			—
Stock-based compensation		—			—			7,819			—			—			—			7,819			—			—			7,819			—			—			—			7,819
Exercise of stock options		67,797			1			137			—			—			—			138			67,797			1			137			—			—			—			138
Common stock issued under ESPP		27,335			—			463			—			—			—			463			27,335			—			463			—			—			—			463
Issuance in acquisition of Eco		357,797			4			6,104			—			—			—			6,108			357,797			4			6,104			—			—			—			6,108
Other comprehensive income, net of tax expense of $1,531		—			—			—			4,286			—			—			4,286			—			—			—			4,286			—			—			4,286
Net income		—			—			—			—			32,878			—			32,878
Change in redemption value of redeemable non-controlling interest		—			—			—			—			(6,081	)		—			(6,081	)
Net income attributable to the Company																							—			—			—			—			32,878			—			32,878
Change in redemption value of RNCI																							—			—			—			—			(6,081	)		—			(6,081	)
Balance at January 1, 2022		59,696,117		$	635		$	433,347		$	7,006		$	106,398		$	(18,289	)	$	529,097			59,696,117		$	635		$	433,347		$	7,006		$	106,398		$	(18,289	)	$	529,097
Grants of restricted stock																							—			6			(6	)		—			—			—			—
Vesting of restricted stock																							359,360			—			—			—			—			—			—
Forfeitures of restricted stock																							—			(1	)		1			—			—			—			—
Purchases of treasury stock																							(86,124	)		—			—			—			—			(1,565	)		(1,565	)
Stock withheld in lieu of taxes																							(95,001	)		—			—			—			—			(1,888	)		(1,888	)
Retirement of treasury stock																							—			(1	)		(1,498	)		—			(389	)		1,888			—
Stock-based compensation																							—			—			9,670			—			—			—			9,670
Common stock issued under ESPP																							37,204			—			602			—			—			—			602
Other comprehensive income, net of tax benefit of $2,345																							—			—			—			(6,783	)		—			—			(6,783	)
Net income attributable to the Company																							—			—			—			—			96,882			—			96,882
Change in redemption value of RNCI																							—			—			—			—			2,000			—			2,000
Balance at December 31, 2022																							59,911,556		$	639		$	442,116		$	223		$	204,891		$	(19,854	)	$	628,015
Grants of restricted stock																							—			10			(10	)		—			—			—			—
Vesting of restricted stock																							767,734			—			—			—			—			—			—
Forfeitures of restricted stock																							—			(4	)		4			—			—			—			—
Purchases of treasury stock																							(3,300,233	)		—			—			—			—			(83,090	)		(83,090	)
Stock withheld in lieu of taxes																							(241,290	)		—			—			—			—			(7,240	)		(7,240	)
Retirement of treasury stock																							—			(2	)		(4,577	)		—			(2,661	)		7,240			—
Stock-based compensation																							—			—			12,240			—			—			—			12,240
Deferred taxes from RNCI redemption																							—			—			—			—			1,464			—			1,464
Common stock issued under ESPP																							50,059			1			1,108			—			—			—			1,109
Other comprehensive income, net of tax benefit of $11																							—			—			—			(32	)		—			—			(32	)
Net income attributable to the Company																							—			—			—			—			109,038			—			109,038
Change in redemption value of RNCI																							—			—			—			—			(1,637	)		—			(1,637	)
Balance at December 30, 2023																							57,187,826		$	644		$	450,881		$	191		$	311,095		$	(102,944	)	$	659,867

The accompanying notes are an integral part of these consolidated financial statements.


	January 1,			January 2,			December 30,			December 31,
	2022			2021			2023			2022
	(in thousands)						(in thousands)
Accounts receivable	$	145,923		$	96,560		$	131,795		$	173,763
Less: Allowance for credit losses		(4,702	)		(3,716	)		(14,178	)		(13,656	)

Accounts receivable, net	$	141,221		$	92,844		$	117,617		$	160,107

The accrual for warranty is included in accrued liabilities and other liabilities, depending on estimated settlement date, in the consolidated balance sheets as of ~~January 1, 2022~~December 30, 2023 and ~~January 2, 2021.~~December 31, 2022. The portion of warranty expense related to the issuance of product of $~~3.0~~3.2 million, $~~3.8~~3.9 million and $~~2.7~~3.0 million is included in cost of sales in the consolidated statements of operations for the years ended December 30, 2023, December 31, 2022, and January 1, 2022, ~~January 2, 2021, and December 28, 2019,~~ respectively. The portion related to servicing warranty claims including costs of the service department personnel is included in selling, general and administrative expenses in the consolidated statements of operations, and is $~~19.2~~32.8 million, $~~11.7~~28.1 million and $~~10.6~~19.2 million, respectively, for the years ended December 30, 2023, December 31, 2022, and January 1, ~~2022, January 2, 2021, and December 28, 2019.~~2022.

4. Revenue ~~Recognition and Contracts with Customers~~

Revenue Recognition Accounting Policy

The Company primarily manufactures fully customized windows and doors based on design specifications, measurements, colors, finishes, framing materials, glass-types, and other options selected by the customer at the point in time an order is received. The Company has an enforceable right to payment at the time an order is received and accepted at the agreed-upon sales prices contained in our agreements with our customers for all manufacturing efforts expended on behalf of its customers. Due to the customized build-to-order nature of these products, the Company’s assessment is that the substantial portion of its finished goods and certain unused glass components have no alternative use, and that control of these products and components passes to the customer over time during the manufacturing of the products in an order, or upon our receipt of certain pre-cut glass components from our supplier attributed to specific customer orders. We give our customers 30-day payment terms, which is typical in our industry.

Based on these factors, the Company recognizes a substantial portion of revenue over time during the manufacturing process once customization begins, generally based on the cost of material and labor inputs to the manufacturing process, and for certain unused glass components on hand, at the end of a reporting period. Revenue on work-in-process at the end of a reporting period is recognized in proportion to costs incurred to total estimated cost of the product being manufactured. Except for the Western segment’s volume products, discussed in the section titled Disaggregation of Revenue from Contracts with Customers below, revenue recognized at a point in time is immaterial.

Disaggregation of Revenue from Contracts with Customers

As discussed in Note 1, we have 2two reportable segments: our Southeast segment and our Western segment. See Note 2019 for more information. The following table provides information about our net sales by reporting segment and product category ~~and market~~ for the years ended December 30, 2023, December 31, 2022, and January 1, 2022 ~~January 2, 2021, and December 28, 2019~~ (in millions):

~~- 60~~ -


	Year Ended						Year Ended
	January 1,		January 2,		December 28,		December 30,		December 31,		January 1,
Disaggregation of revenue:	2022		2021		2019		2023		2022		2022
Reporting segment:
Southeast	$	968.7	$	752.4	$	606.6	$	1,130.4	$	1,110.4	$	968.7
Western		192.8		130.2		138.4		373.8		381.6		192.8

Total net sales	$	1,161.5	$	882.6	$	745.0	$	1,504.2	$	1,492.0	$	1,161.5

Product category:
Impact-resistant window and door products	$	787.2	$	630.2	$	516.1	$	926.3	$	878.8	$	787.2
Non-impact window and door products		374.3		252.4		228.9		577.9		613.2		374.3

Total net sales	$	1,161.5	$	882.6	$	745.0	$	1,504.2	$	1,492.0	$	1,161.5

Market:
New construction	$	489.9	$	402.5	$	368.4
Repair and remodel		671.6		480.1		376.6

Total net sales	$	1,161.5	$	882.6	$	745.0

The Company’s Western segment includes both custom and volume products. This segment’s volume products are not made-to-order and are of standardized sizes and design specifications. Therefore, the Company’s assessment is that the Western segment’s volume products have alternative uses, and that control of these products passes to the customer at a point in time, which is typically when the product has been delivered to the customer. For the years ended December 30, 2023, December 31, 2022, and January 1, 2022, ~~January 2, 2021, and December 28, 2019,~~ the Western segment’s net sales of its volume products were $~~83.0~~79.4 million, $~~53.2~~111.5 million and $~~53.9~~83.0 million, respectively.

Contract Balances

Contract assets represent sales recognized in excess of billings related to finished goods not yet shipped and certain unused glass components not yet placed into the production process for which revenue is recognized over time as noted above. Contract liabilities relate to customer deposits at the end of reporting periods. At ~~January 1,~~December 30, 2023 and December 31, 2022, ~~and January 2, 2021,~~ those contract liabilities totaled $~~45.2~~21.9 million and $~~22.8~~39.1 million, respectively, of which $~~37.0~~17.1 million and $~~18.1~~33.4 million, respectively, are classified within accrued liabilities, and $~~8.2~~4.8 million and $~~4.6~~5.7 million, respectively, are classified within contract assets, net, in the accompanying consolidated balance sheets at ~~January 1, 2022~~December 30, 2023 and ~~January 2, 2021.~~December 31, 2022.

Because of the short-term nature of our performance obligations, as discussed below, substantially all of our performance obligations are satisfied within the quarter following the end of a reporting period. As such, substantially all of the contract liabilities at ~~January 2, 2021~~December 31, 2022 were satisfied in the first quarter of ~~2021,~~2023, and contract assets at ~~January 2, 2021~~December 31, 2022 were transferred to accounts receivable in the first quarter of ~~2021.~~2023. Also, substantially all of the contract liabilities at December 30, 2023 will be satisfied in the first quarter of 2024, and contract assets at December 30, 2023 will be transferred to accounts receivable in the first quarter of

- 57 -

2024. Contract liabilities at ~~January 1,~~December 30, 2023 represents cash received during the three-month period ended December 30, 2023, excluding amounts recognized as revenue during that period. Contract assets at December 30, 2023 represents revenue recognized during the three-month period ended December 30, 2023, excluding amounts transferred to accounts receivable during that period. Contract liabilities at December 31, 2022 represents cash received during the three-month period ended ~~January 1,~~December 31, 2022, excluding amounts recognized as revenue during that period. Contract assets at ~~January 1,~~December 31, 2022 represents revenue recognized during the three-month period ended ~~January 1,~~December 31, 2022, excluding amounts transferred to accounts receivable during that period.

Performance Obligations

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is defined as the unit of account. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue as the performance obligation is satisfied. Our contracts with our customers generally represent an approved purchase order, together with our standard terms and conditions. Our custom product contracts include distinct goods that are substantially the same and have the same pattern of transfer to the customer over time, and therefore represent a series of distinct goods accounted for as a single performance obligation. For volume products, we allocate the contract’s transaction price to each distinct performance obligation based on the estimated relative standalone selling price of each distinct good. Observable standalone sales are used to determine the standalone selling price. Certain customers are eligible for rebates based on their volume or purchases during an annual period. Rebates are recorded as a reduction to sales and were immaterial in all periods presented.

Performance obligations are satisfied over time, generally for our custom products, and as of a point in time for our volume products. Performance obligations are supported by contracts with customers, and we have elected not to disclose our unsatisfied performance obligations as of ~~January 1, 2022~~December 30, 2023 under the short-term contract exemption as we expect such performance obligations will be satisfied within the quarter following the end of a reporting period.

~~- 61~~ -

Policies Regarding Shipping and Handling Costs and Commissions on Contract Assets

The Company has made a policy election to continue to recognize shipping and handling costs as a fulfillment activity. Treating shipping and handling as a fulfillment activity requires estimated shipping and handling costs for undelivered custom products and certain glass components on which we have recognized revenue and created a contract asset, to be accrued to match this cost with the recognized revenue.

The Company utilizes the practical expedient which permits expensing of costs to obtain a contract when the expected amortization period is one year or less, which typically results in expensing commissions paid to employees. We expense sales commissions paid to employees as sales are recognized, including sales from the creation of contract assets, as the expected amortization period is less than one year.

5. Acquisitions

Martin Doors

On October 14, 2022, we completed the acquisition of the Martin Doors brand. The acquisition was done by WWS Acquisition, LLC, a Missouri limited liability company, indirectly wholly-owned by PGT Innovations, Inc., which acquired all of the shares of stock of Martin Door Holdings, Inc., a Utah corporation, headquartered in Salt Lake City, Utah, a custom manufacturer of overhead garage doors and hardware serving the Western U.S. (the "Martin Acquisition"), pursuant to that certain Share Purchase Agreement dated as of October 14, 2022 (the “Martin Purchase Agreement”). The fair value of consideration transferred in the Martin Acquisition was $188.5 million, composed entirely of cash, including $185.0 million for purchase price and $3.5 million in working capital adjustments, of which $2.8 million was estimated and paid at closing, and $0.7 million was paid in the first quarter of 2023 upon finalization of the net working capital calculation.

The cash portion of the Martin Acquisition was financed with borrowings under the fifth amendment of our 2016 Credit Agreement due 2027 of $98.4 million, and the remaining $90.1 million funded with cash on hand. Generally, cash on hand for the Martin Acquisition was provided by cash generated through operations.

Purchase Price Allocation

The fair value of assets acquired, and liabilities assumed as of the closing date, are as follows:



	Initial Allocation			Adjustments to Allocation			Final Allocation
Accounts receivable	$	6,653		$	(194	)	$	6,459
Inventories		9,543			(364	)		9,179
Contract assets, net		5,242			—			5,242
Prepaid expenses and other assets		90			—			90
Property and equipment		11,422			(1,196	)		10,226
Operating lease right-of-use asset		12,259			—			12,259
Intangible assets		91,900			—			91,900
Total assets acquired		137,109			(1,754	)		135,355
Accounts payable		(2,482	)		—			(2,482	)
Accrued and other liabilities		(1,270	)		283			(987	)
Deferred tax liabilities		(23,604	)		—			(23,604	)
Operating lease liability		(12,259	)		—			(12,259	)
Total liabilities assumed		(39,615	)		283			(39,332	)
Net assets acquired		97,494			(1,471	)		96,023
Goodwill		90,300			2,215			92,515
Fair value of consideration transferred	$	187,794		$	744		$	188,538

Consideration:
Cash	$	187,794		$	744		$	188,538
Fair value of consideration transferred	$	187,794		$	744		$	188,538

The fair value of certain working capital related items, including Martin’s accounts receivable, prepaid expenses and other assets, and accounts payable and accrued and other liabilities, approximated their book values at the date of the Martin Acquisition. The fair value of inventory was estimated by major category, at net realizable value, which we believe approximates the price a market participant could achieve in a current sale. The substantial majority of inventories at the acquisition date was comprised of raw materials. The fair value of property and equipment and remaining useful lives were estimated by management, with the assistance of a third-party valuation firm, using the cost approach. Valuations of the intangible assets were done using income and royalty relief approaches based on projections provided by management, which we consider to be Level 3 inputs, with the assistance of a third-party valuation firm. We made immaterial adjustments to our purchase allocation relating to accounts receivable, inventories, property and equipment, and accrued and other liabilities.

We incurred acquisition costs totaling $4.8 million relating to legal expenses, representations and warranties insurance, diligence, accounting and other services in the Martin Acquisition, classified as selling, general and administrative expenses in the accompanying consolidated statements of operations for the year ended December 31, 2022.

Because the Martin Acquisition was an acquisition of stock, Martin's assets and liabilities retain their tax bases at the time of the acquisition. Therefore, none of the identifiable intangible assets or goodwill acquired in the Martin Acquisition are deductible for tax

- 59 -

purposes. As of December 30, 2023, goodwill is $92.5 million. Martin's goodwill is included as part of the Western reporting unit. We believe Martin's goodwill relates to the expansion of our footprint in a key, strategic market we have identified as a geographic area of growth for our Company, as well as being a key component of our strategy to expand into adjacent building material products, other than windows and doors.

Valuation of Identified Intangible Assets

The valuation of the identifiable intangible assets acquired in the Martin Acquisition and our estimate of their respective useful lives are as follows:


			Initial
	Final		Useful Life
	Valuation		(in years)
(in thousands)
Trade name	$	24,000	indefinite
Customer relationships		52,700	15
Customer-related backlog (amortized in 2022)		400	<1
Developed technology		14,600	3 - 14
Non-compete-related intangible		200	5

Intangible assets, net	$	91,900

Anlin Windows & Doors

On October 25, 2021, we completed the acquisition of Anlin Windows & Doors. The acquisition was done by Western Window Holding LLC, a Delaware limited liability company, indirectly wholly-owned by PGT Innovations, Inc., which acquired substantially all of the assets, properties and rights owned, used or held for use in the business, as operated by Anlin Industries, a California corporation, of manufacturing vinyl windows and doors for the replacement market and the new construction market, and all activities conducted in connection therewith (the "Anlin Acquisition"), pursuant to that certain Asset Purchase Agreement dated as of September 1, 2021 (the “Anlin Purchase Agreement”), by and among the Company, and Anlin Industries. The fair value of consideration transferred in the Anlin Acquisition was $~~120.1~~121.7 million, composed of $~~114.2~~115.0 million in cash, including $113.5 million for purchase price and $~~0.7~~1.5 million in ~~estimated~~ working capital ~~adjustment,~~adjustments, including $0.8 million paid during the three months ended October 1, 2022, and ~~estimated~~ fair value of contingent consideration of $~~5.9~~6.7 million, discussed in greater detail below.

The ~~cash portion of the Anlin Acquisition of $114.2~~ ~~million was financed with borrowings under the fourth amendment of our 2016 Credit Agreement due 2024 of $60.0~~ ~~million, which resulted in net proceeds after fees of $59.4~~ ~~million, with the remaining $54.8~~ ~~million from cash on hand. Cash on hand for the Anlin Acquisition was ultimately provided by the issuance of senior notes due 2029 of $575.0~~ ~~million of~~ ~~4.375% and related transactions, further explained in Note 10, Long-Term Debt.~~

~~Purchase Price Allocation~~

~~The estimated fair value of assets acquired, and liabilities assumed as of the closing date, are as follows:~~

Preliminary
Allocation

Accounts receivable

$
10,803

Inventories

7,633

Contract assets, net

7,027

Prepaid expenses and other assets

1,626

Property and equipment

22,800

Operating lease right-of-use asset

3,450

Intangible assets

77,800

Goodwill

5,596

Total assets acquired

136,735

Accounts payable

(5,175
)
Accrued and other liabilities

(7,993
)
Operating lease liability

(3,450
)
Total liabilities assumed

(16,618
)
Fair value of consideration transferred

$
120,117

Consideration:

Cash

$
114,196

Contingent consideration

5,921

Fair value of consideration transferred

$
120,117

The fair value of certain working capital related items, including Anlin’s accounts receivable, prepaid expenses and other assets, and accounts payable and accrued liabilities, approximated their book values at the date of the Anlin Acquisition. The fair value of inventory was estimated by major category, at net realizable value, which we believe approximates the price a market participant

~~- 62~~ -

could achieve in a current sale. The substantial majority of inventories at the acquisition date was composed of raw materials. The fair value of property and equipment and remaining useful lives were estimated by management, with the assistance of a third-party valuation firm, using the cost approach. Valuations of the intangible assets were done using income and royalty relief approaches based on projections provided by management, which we consider to be Level 3 inputs, with the assistance of a third-party valuations firm.

~~We incurred acquisition costs totaling $1.8~~ million relating to legal expenses, representations and warranties insurance, diligence, accounting and printing services in the Anlin Acquisition, classified as selling, general and administrative expenses in the accompanying consolidated statements of operations for the year ended January 1, 2022.

~~The~~ Anlin Purchase Agreement ~~provides~~provided for the potential for an earn-out contingency ~~payment~~payments to the sellers should Anlin achieve a certain level of earnings before interest, taxes, depreciation and amortization, ("Anlin EBITDA"), as defined in the Anlin Purchase Agreement, for its fiscal years of 2021 and 2022, of up to $3.2 million to be paid out by March 31, 2022, and of up to $9.5 million to be paid out by March 31, 2023, respectively. We ~~have~~had recorded ana preliminary earn-out ~~contingency~~contingent liability of $5.9 million ~~representing~~as of our 2021 fiscal year ended January 1, 2022, which represented its then estimated fair value based on probability adjusted levels of estimated Anlin EBITDA. Estimated Anlin EBITDA is a significant input that is not observable in the market, which ASC 820 considers to be a Level 3 input. ~~This~~In the first quarter of 2022, we finalized the fair value of the earn-out contingency, which we adjusted by an additional $0.8 million, to a total of $6.7 million of estimated fair value of contingent consideration ~~is preliminary, and may be adjusted~~ as ~~we continue to review~~of the ~~calculation's inputs and assumptions. For tax purposes,~~effective date of the Anlin Acquisition. This amount included $2.4 million for the contingent consideration ~~does not become part of tax goodwill until paid. As such,~~relating to 2021 Anlin EBITDA and $4.3 million for the ~~amount of goodwill deductible for tax purposes will not~~contingent consideration relating to the 2022 Anlin EBITDA.

The first contingent consideration payment was agreed to be ~~finalized until the outcome of this earn-out contingency is known. As of January 1, 2022, as the~~$2.7 million, which exceeded its estimated fair value ~~of the earn-out contingency exceeds the amount of book goodwill, there is currently~~ by $00.3 ~~goodwill deductible~~million. This excess is classified as selling, general and administrative expenses in our 2022 fiscal year ended December 31, 2022. The payment was made during the second quarter of 2022 after both parties agreed to extend the deadline for ~~tax purposes, and~~ the ~~amount by which~~first payment past the ~~estimated fair value of the earn-out contingency exceeds book goodwill has gone to reduce the tax bases of the other intangible assets recorded~~March 31, 2022 due date stated in the Anlin ~~Acquisition. We believe goodwill relates to the expansion of our footprint in a key, strategic market we have identified as a geographic area of growth for our Company.~~Purchase Agreement.

~~Regarding~~As of the ~~allocation~~end of 2022, we updated our estimate of the fair value of the contingent consideration ~~transferred in~~relating to 2022 Anlin EBITDA to $9.5 million, which was the ~~Anlin Acquisition, specific items being finalized are our calculations of contingencies assumed in~~maximum potential payout for fiscal year 2022 under the Anlin acquisition, including the earn-out contingency and reserves for warranty obligations. Our estimated fair values of intangibles assets acquired and property and equipment may change as we continue our review changes made to the calculations performed by our third-party valuation firm. However, as noted above, the purchase allocation is preliminary and other items are subject to change.

~~The~~ Anlin Purchase Agreement, ~~has a post-closing working capital calculation whereby~~which we ~~are required to prepare, and deliver to sellers, a final statement of purchase price.~~

~~Valuation of Identified Intangible Assets~~

~~The valuation of the identifiable intangible assets acquired~~paid-out in the ~~Anlin Acquisition and our estimate~~first quarter of ~~their respective useful lives are as follows:~~

Initial

Preliminary

Useful Life

Valuation

(in years)
(in thousands)

Trade name

$
35,400

indefinite
Customer relationships

42,100

15
Developed technology

300

9

Intangible assets, net

$
77,800

~~Pro Forma Financial Information~~

~~The following unaudited pro forma financial information assumes the acquisition had occurred at the beginning~~2023. As such, we recognized an expense of the earliest period presented that does not include Anlin's actual results for the entire period. Pro forma results have been prepared by adjusting our historical results to include the results of Anlin adjusted for the following: amortization expense related to the intangible assets arising from the acquisition and interest expense to reflect the refinancing of the 2018 Senior Notes due 2026 and the third amendment of the 2016 Credit Agreement due 2024 into the 2021 Senior Notes due 2029 and the fourth amendment of the 2016 Credit Agreement due 2024. The unaudited pro forma results below do not necessarily reflect the results of operations that would have resulted had the acquisition been completed at the beginning of the earliest periods presented, nor does it indicate the results of operations in future periods. ~~The unaudited pro forma results do not include the impact of synergies, nor any potential impacts on current or future market conditions which could alter the following unaudited pro forma results.~~

~~- 63~~ -

Years Ended

January 1,

January 2,

Pro Forma Results (unaudited)

2022

2021

(in thousands, except per share amounts)

(unaudited)

Net sales

$
1,251,314

$
967,825

Net income attributable to common shareholders

$
35,273

$
50,838

Net income per common share attributable to common shareholders:

Basic

$
0.59

$
0.86

Diluted

$
0.59

$
0.86

~~Sales from Anlin included in the year ended January 1, 2022, since its October 25, 2021 acquisition date, totaled $21.4~~ ~~million, and had net income, included in consolidated net income of $1.9~~ ~~million in the year ended January 1, 2022. Such net income has not been reduced for any income taxes or interest expense as we do not allocate such amounts to the division level.~~

~~CRi SoCal, Inc.~~

On May 2, 2021, pursuant to an asset purchase agreement dated April 9, 2021, we acquired substantially all of the assets and assumed certain liabilities of CRi SoCal, Inc. (“CRi”), a California corporation doing business in California as Combined Resources (the “CRi Acquisition”). CRi is engaged in the sales, distribution and installation of window and door products, and related design services, to homebuilders in the residential new construction market from its leased facility in Rancho Santa Margarita, California. Until its acquisition by the Company, CRi was a customer of the Company’s western business unit.

~~The fair value of consideration transferred in the acquisition of CRi totaled $12.5~~ ~~million, and included $12.1~~ ~~million in cash, funded from cash on hand, and $0.4~~ million in accounts receivable owed by CRi to the Company’s western business unit relating to sales prior to the acquisition, which are considered settled as a result of the acquisition. The purchase price is subject to change through a net working capital adjustment, currently being finalized. The preliminary estimated fair value of assets acquired and liabilities assumed totaled $~~17.6~~ ~~million and~~approximately $5.1 million, ~~respectively, which included offsetting operating lease right of use assets and operating lease liabilities totaling $2.6~~ ~~million. The~~representing the difference between this updated estimated fair value, ~~of assets acquired also included current assets totaling $4.1~~ ~~million, primarily accounts receivable, identifiable intangible assets totaling $7.0~~ ~~million, goodwill of $3.7~~ ~~million, all of which we believe is tax deductible,~~ and ~~a small amount of property and equipment. Liabilities assumed included the aforementioned operating lease liability, as well as a total of $2.5~~ million in trade accounts payable and customer deposits. Valuations of the intangible assets have been estimated using income and royalty relief approaches based on projections, which we consider to be Level 3 inputs, with the assistance of a third-party valuation firm. We believe goodwill in the acquisition relates to the expansion of our footprint in an existing market, in a way that we believe will enhance our long-term profitability in that market of our Western business.

~~Sales from CRi included in the year ended January 1, 2022, since its May 2, 2021 acquisition date totaled $10.9~~ ~~million. CRi’s effect on consolidated net income was immaterial in the year ended January 1, 2022.~~

~~NewSouth Window Solutions~~

On ~~February 1, 2020~~, we completed the acquisition of NewSouth Window Solutions LLC and NewSouth Window Solutions of Orlando LLC (together, “NewSouth”, and “NewSouth Acquisition”), which became wholly-owned subsidiaries of PGT Innovations, Inc. The fair value of consideration transferred in the acquisition was $~~90.4~~ ~~million. The acquisition was financed with proceeds of $53.2~~ ~~million from the add-on issuance of $50.0~~ ~~million in 2018 Senior Notes due 2026 (“Add-On Senior Notes”), including a premium of $3.2~~ ~~million, and with $37.2~~ ~~million in cash, including a post-closing adjustment owed to sellers of $0.2~~ ~~million, which was paid during the third quarter of 2020, described below. See Note 10 for a discussion of the First Additional Senior Notes.~~

~~- 64~~ -

~~Purchase Price Allocation~~

~~The estimated fair value of assets acquired, and liabilities assumed as of the closing date, are as follows:~~

Initial
Allocation

Adjustments to
Allocation

Final
Allocation

Accounts receivable

$
10,294

$
(1,860
)

$
8,434

Inventories

3,757

(821
)

2,936

Contract assets, net

4,413

—

4,413

Prepaid expenses and other assets

1,756

—

1,756

Property and equipment

7,423

10

7,433

Operating lease right-of-use asset

10,578

—

10,578

Intangible assets

28,670

(1,300
)

27,370

Goodwill

46,200

5,894

52,094

Accounts payable

(6,621
)

—

(6,621
)
Accrued and other liabilities

(5,524
)

(1,923
)

(7,447
)
Operating lease liability

(10,578
)

—

(10,578
)
Purchase price

$
90,368

$
—

$
90,368

Consideration:

Cash

$
90,145

$
223

$
90,368

Due to Sellers

223

(223
)

-

Total fair value of consideration

$
90,368

$
—

$
90,368

The fair value of certain working capital related items, including NewSouth’s retail accounts receivable, prepaid expenses, and accounts payable and accrued liabilities, approximated their book values at the date of the NewSouth Acquisition. Subsequent to our initial allocation, we adjusted the fair value ~~of certain acquired commercial receivable accounts based on a further post-acquisition assessment of their collectability. The fair value of inventory was~~ estimated by major category, at net realizable value. The substantial majority of inventories at the acquisition date was composed of raw materials. The fair value of property and equipment and remaining useful lives were estimated by management, with the assistance of a third-party valuation firm, using the cost approach. Valuations of the intangible assets were done using income and royalty relief approaches based on projections provided by management, which we consider to be Level 3 inputs, with the assistance of a third-party valuations firm.

~~We incurred acquisition costs totaling $2.4~~ ~~million relating to legal expenses, representations and warranties insurance, diligence, accounting and printing services~~ in ~~the NewSouth Acquisition, which includes $0.9~~ ~~million in 2020, and $1.5~~ ~~million in 2019,~~our purchase price allocation, classified as selling, general and administrative expenses in the ~~accompanying consolidated statements of operations for the years~~year ended ~~January 2, 2021, and~~ December ~~28, 2019, respectively.~~31, 2022.

~~The remaining~~Having paid all contingent consideration ~~after identified intangible assets and~~in the ~~net assets and liabilities recorded at fair value, has been determined to be~~Anlin Acquisition, which combined totaled $~~52.1~~12.1 million ~~all of~~and which exceeds the $6.7 million fair value on contingent consideration established in the purchase allocation, we ~~expect to be deductible for~~believe that our tax ~~purposes. Goodwill represents~~basis in the ~~increased value~~goodwill of the ~~combined entity through new direct-to-consumer sales channel opportunities, as well as NewSouth’s extensive advertising throughout Florida, and NewSouth’s market intelligence, which we expect~~Anlin Acquisition is equal to ~~utilize. During 2020, we made additional adjustments to accrued liabilities assumed in the acquisition totaling~~its book basis of $~~1.9~~ million, relating to certain commercial contracts that existed at the acquisition date, which required additional warranty-related rework to complete and which we were not aware of until after the acquisition date, during 2020. Other adjustments to our initial allocation primarily relate to the commercial assets acquired and liabilities assumed in the NewSouth Acquisition. The adjustments included a $~~1.9~~ ~~million decrease in acquired commercial accounts receivable, which we determined were uncollectible, a $1.3~~ ~~million decrease in acquired intangible assets relating to the commercial trade name, which we have determined had no fair value at the acquisition date, and $0.8~~ million relating to certain commercial inventories, which we determined were obsolete at the acquisition date. The net increase in goodwill relating to these adjustments since the initial allocation was $~~5.9~~9.6 million.

~~The purchase agreement relating to the NewSouth Acquisition (“PA”) requires certain post-closing adjustments, under which we determined that we owed sellers an additional $0.2~~ ~~million. The calculation resulted in a net increase in purchase price of $0.2~~ ~~million. We paid this amount during the third quarter of 2020.~~

~~The valuation of the identifiable intangible assets acquired in the NewSouth Acquisition and our estimate of their respective useful lives are as follows:~~

The following unaudited pro forma financial information assumes the acquisition had occurred at the beginning of the earliest period presented that does not include NewSouth’s actual results for the entire period. Pro forma results have been prepared by adjusting our historical results to include the results of NewSouth adjusted for the following: amortization expense related to the intangible assets arising from the acquisition and interest expense to reflect the First Additional Senior Notes. The unaudited pro forma results below do not necessarily reflect the results of operations that would have resulted had the acquisition been completed at the beginning of the earliest periods presented, nor does it indicate the results of operations in future periods. ~~The unaudited pro forma results do not include the impact of synergies, nor any potential impacts on current or future market conditions which could alter the following unaudited pro forma results.~~

~~Net sales of NewSouth, included in the consolidated statement of operations for the year ended January 1, 2022, was $146.8~~ ~~million. The net income of NewSouth in the consolidated statements of operations for the year ended January 1, 2022, was $17.8~~ ~~million. Net sales of NewSouth, included in the consolidated statement of operations for the year ended January 2, 2021, was $93.9~~ ~~million. The net income of NewSouth in the consolidated statements of operations for the year ended January 2, 2021, was $2.0~~ ~~million. Such net income amounts have not been reduced for any income taxes or interest expense as we do not allocate such amounts to the division level.~~

On ~~February 1, 2021, we completed the acquisition of a~~ 75% ownership stake in Eco Enterprises and its related companies, Eco Windows Systems, LLC, Eco Glass Production, LLC, and Unity Windows, LLC (together “Eco”). Eco is a manufacturer and installer of aluminum, impact-resistant windows and doors, serving the South Florida region since 2009. Eco is headquartered in Medley, Florida, near Miami, Florida, and has three manufacturing locations in the region, including a glass processing facility.

~~The fair value consideration for Eco was $100.5~~ ~~million, including $94.4~~ ~~million in cash, which was after adjustments in our favor totaling $5.6~~ million relating to working capital and customer deposits. These adjustments were agreed to and settled in the second quarter of 2021. The fair value of consideration also included PGT Innovations, Inc. common stock with a then estimated fair value of $~~6.1~~ ~~million. The cash portion of the purchase price was financed by a second add-on issuance of $60.0~~ ~~million aggregate principal amount of~~ ~~6.75% senior notes to the 2018 Senior Notes due 2026 on January 25, 2021 (the “Second Additional Senior~~

~~Notes”), issued at~~ ~~105.5% of their principal amount, resulting in a premium to us of $3.3~~ ~~million, together with cash on hand of $31.1~~ ~~million. See Note 10 for a discussion of the Second Additional Senior Notes.~~

~~The common stock portion of the purchase price was represented by the issuance of~~ ~~357,797~~ ~~shares of PGT Innovations, Inc. common stock on February 1, 2021, with a closing price value of $21.34~~ ~~per share on that date, or approximately $7.6~~ ~~million based on that price. However, the seller of Eco, who is also the holder of the~~ 25~~% redeemable non-controlling interest in Eco Enterprises, is restricted from selling these shares for a~~ ~~three-year~~ ~~period from the date of the acquisition. As such, we estimated that there was an approximately~~ 20~~% discount for the lack of marketability of the shares. The fair value of the redeemable non-controlling interest in the acquisition has been preliminarily estimated to be $28.5~~ ~~million, resulting in total fair value of the Eco business in the acquisition, including the redeemable non-controlling interest, of $128.9~~ ~~million. The fair value of the redeemable non-controlling interest has been calculated as~~ 25~~% of the initial estimated fair value of the entity at the acquisition date, less a discount for seller’s lack of control in the new entity, estimated to be~~ 5~~%, and a discount for the seller’s lack of marketability of the minority stake, estimated to be~~ 10~~%. See Note 23 for more information regarding the redeemable non-controlling interest.~~

The fair value of certain working capital related items, including Eco’s accounts receivable, prepaid and other expenses, and accounts payable and accrued liabilities, approximated their book values at the date of the Eco Acquisition. Subsequent to our initial allocation, we adjusted the fair value of certain acquired commercial receivable accounts based on a further post-acquisition assessment of their collectability. The fair value of inventory was estimated by major category, at net realizable value, which we believe approximates the price a market participant could achieve in a current sale. Substantially all of inventories at the acquisition date was composed of raw materials. The fair value of property and equipment was estimated with the assistance of a third-party valuation firm, using the indirect cost approach, which we consider to be Level 3 in the fair value hierarchy. Valuations of the intangible assets have been estimated using income and royalty relief approaches based on projections, which we consider to be Level 3 inputs, with the assistance of a third-party valuation firm.

~~We incurred acquisition costs totaling $1.7~~ ~~million relating to legal expenses, representations and warranties insurance, diligence, accounting and printing services in the Eco Acquisition, which includes $1.0~~ ~~million in the fourth quarter of 2020, and $0.7~~ million in 2021, classified as selling, general and administrative expenses in the accompanying condensed consolidated statement of operations for the years ended January 1, 2022 and January 2, 2021, respectively.

~~The remaining consideration, after identified intangible assets and the net assets and liabilities recorded at fair value, has currently been estimated to be $25.6~~ ~~million, classified as part of the Southeast reporting unit goodwill, which we expect the portion of goodwill relating to our~~ 75% investment to be deductible for tax purposes. In addition, we are currently evaluating the historical book and tax bases of assets and liabilities relating to the redeemable non-controlling interest, which may not be eligible for a step-up in basis, for any deferred tax assets and liabilities that may need to be recorded in the Eco Acquisition.

We believe goodwill represents the strengthening of our supply chain for glass through faster glass production, as well as diversification and expansion of product offerings in the high-growth commercial market, and an expansion of our dealer network with minimal overlap with our existing deal network.

The following unaudited pro forma financial information assumes the Eco Acquisition had occurred at the beginning of the earliest period presented that does not include Eco’s actual results for the entire period. Pro forma results have been prepared by adjusting our historical results to include the results of Eco adjusted for the following: amortization expense related to the estimated intangible assets arising from the acquisition; interest expense to reflect the Second Additional Senior Notes; net income attributable to redeemable non-controlling interest; and, change in redemption value of redeemable non-controlling interest. The unaudited pro forma results below do not necessarily reflect the results of operations that would have resulted had the acquisition been completed at the beginning of the earliest periods presented, nor does it indicate the results of operations in future periods. ~~The unaudited pro forma results do not include the impact of synergies, nor any potential impacts on current or future market conditions which could alter the following unaudited pro forma results.~~

~~Net sales of Eco included in the consolidated statement of operations for the year ended January 1, 2022, from the date of its February 1, 2021 acquisition, was $85.6~~ million, after eliminations of intercompany sales. The net income of Eco in the consolidated statement of operations for the year ended January 1, 2022, from the date of its February 1, 2021 acquisition, was $~~9.3~~ ~~million, including the portions attributable to the redeemable non-controlling interest of $2.3~~ ~~million.~~

8.7. Goodwill and Intangible Assets

Goodwill and i~~ntangible~~intangible assets are as follows as of:

Initial

January 1,

January 2,

Useful Life

2022

2021

(in years)

(in thousands)

Goodwill

$
364,598

$
329,695

indefinite

Other intangible assets:

Trade names (indefinite-lived)

$
212,141

$
140,841

indefinite

Customer relationships and customer-related assets

289,047

201,547

<1-15
Trade name (amortizable)

22,200

22,200

15
Developed technology

5,900

5,600

6-10
Non-compete agreement

3,338

3,338

2-5
Software license

590

590

2
Less: Accumulated amortization

(138,691
)

(117,609
)

Subtotal

182,384

115,666

Other intangible assets, net

$
394,525

$
256,507

Goodwill at January 2, 2021

$
329,695

Increase in goodwill from our acquisition of Anlin

5,596

Increase in goodwill from our acquisition of Eco

25,584

Increase in goodwill from our acquisition of CRi

3,722

Goodwill at January 1, 2022

$
364,598

Trade names (indefinite-lived) at January 2, 2021

$
140,841

Increase in trade names from our acquisition of Anlin

35,400

Increase in trade names from our acquisition of Eco

34,900

Increase in trade names from our acquisition in CRi

1,000

Trade names (indefinite-lived) at January 1, 2022

$
212,141


							Initial
	December 30,			December 31,			WA Useful Life
	2023			2022			(in years)
	(in thousands)
Goodwill	$	462,630		$	460,415		indefinite

Other intangible assets:
Trade names (indefinite-lived)	$	219,518		$	225,018		indefinite

Customer relationships and customer-related assets		340,047			340,047		<1-15
Trade name (amortizable)		22,200			22,200		15
Developed technology		20,500			20,500		3-14
Non-compete agreements		3,538			3,538		2-5
Software license		590			590		2

Total amortizable intangibles		386,875			386,875		13

Less: Accumulated amortization		(191,148	)		(164,841	)

Total amortizable intangibles, net		195,727			222,034

Other intangible assets, net	$	415,245		$	447,052

Goodwill at December 31, 2022	$	460,415
Increase from Martin Acquisition net working capital payment		744
Net other measurement period changes in Martin Acquisition		1,471
Goodwill at December 30, 2023	$	462,630

Trade names (indefinite-lived) at December 31, 2022	$	225,018
Decrease due to impairment of Martin trade name		(5,500	)
Trade names (indefinite-lived) at December 30, 2023	$	219,518

- 61 -

Amortizable Intangible Assets

We test amortizable intangible assets for impairment when indicators of impairment exist. ~~NaN~~No impairment was recorded for any period presented.

Estimated amortization of our amortizable intangible assets is as follows for future fiscal years:


(in thousands)	Total		Total
2022	$	23,000
2023		20,807
2024		20,760	$	25,971
2025		20,590		25,640
2026		17,192		21,241
2027				20,987
2028				16,771
Thereafter		80,035		85,117

Total	$	182,384	$	195,727

~~- 70~~ -

Amortization Expense

Amortization expense relating to amortizable intangible assets for the years ended December 30, 2023, December 31, 2022, and January 1, 2022, ~~January 2, 2021, and December 28, 2019,~~ respectively, was $26.3 million, $26.2 million, and $21.1 million, respectively, classified within selling, general and administrative expenses in the accompanying consolidated statements of operations. Accumulated amortization at December 30, 2023, and December 31, 2022 was $~~18.8~~191.1 million and $~~15.9~~164.8 million, ~~respectively.~~respectively, and is composed of the accumulated amortization of the components of amortizable intangible assets, as follows: Customer relationships and customer-related assets - $174.9 million and $153.6 million; Trade name (amortizable) - $5.8 million and $4.3 million; Developed technology - $6.9 million and $3.7 million; Non-compete agreement - $3.0 million and $2.6 million; and, Software license - $0.6 million and $0.6 million.

Goodwill

We perform our annual goodwill impairment testing on the first day of our fiscal fourth quarter of each year, and at interim periods if needed based on occurrence of triggering events. The Company performed a qualitative assessment for each reporting unit. The qualitative assessments indicated that it was more likely than not that the fair value of each reporting unit exceeded its respective carrying value. As of ~~January 1,~~December 30, 2023, and December 31, 2022, ~~and January 2, 2021,~~ the carrying value of our Southeast reporting unit goodwill iswas $~~226.8~~228.3 million and $~~201.3~~228.3 million, respectively. As of ~~January 1,~~December 30, 2023, and December 31, 2022, ~~and January 2, 2021,~~ the carrying value of our Western reporting unit goodwill is $~~137.8~~234.3 million and $~~128.4~~232.1 million, respectively.

Indefinite-Lived Intangible Assets

We perform our annual indefinite-lived intangible asset impairment testing on the first day of our fiscal fourth quarter of each year, and at interim periods if needed based on occurrence of triggering events. ~~Given the~~

In 2023, because of post-acquisition sales levels below those used in its initial ~~deterioration in economic and market conditions associated with the COVID-19 pandemic, and the narrow excess of fair value over carrying value of our WinDoor and WWS trade names in 2019, the Company~~valuation, we determined such conditions represented a triggering ~~events~~event and that we should complete ~~interim~~a quantitative impairment tests of its WinDoor and WWS trade names as of as of the end of the Company’s first quarter of 2020. These interim impairment tests did not indicate that impairments of those assets existed at that time. Net sales at our WWS reporting unit decreased ~~19.3% in the second quarter of 2020, compared to the second quarter of 2019. As a result, we determined to complete a second interim~~ impairment test of our ~~WWS~~Martin trade name as of ~~July 4, 2020. For this second interim~~our annual impairment test ~~we further decreased our modeling assumptions for net sales~~date of the first day of our ~~WWS reporting unit for our 2020 fiscal year based on a reassessment~~fourth quarter of our key assumptions in our modeling, including an updated assessment of macro industry growth in our WWS reporting unit’s key markets. We also decreased our 2021 growth rate assumption as we expected the challenging macro-economic conditions in our core western markets to continue during 2021.2023. Based on our revised modeling, which included our assumptions regarding future revenue, which we consider to be a Level 3 input, using the relief-from-royalty method, we concluded that the fair value of our ~~WWS~~Martin trade name was less than its carrying value, which resulted in an impairment of our ~~WWS~~Martin trade name of $~~8.0~~5.5 million in our ~~second~~fourth quarter of ~~2020. Sales for~~2023. As of December 30, 2023, and December 31, 2022, the carrying value of our ~~WWS reporting unit for~~Martin trade name was $18.5 million and $24.0 million, respectively.

In 2022, given the narrow excess of fair value over carrying value of our WinDoor trade name in the first quarter of 2020, ~~fiscal year exceeded~~the last time we performed a quantitative assessment of our ~~modeling assumptions used during~~WinDoor trade name, and the then recent decrease in sales of our ~~second~~WinDoor brand, we determined such conditions represented triggering events and that we should complete a quantitative impairment test of our ~~WWS~~WinDoor trade ~~name. As such, we performed a qualitative assessment~~name as of our annual impairment test date of the first day of our ~~2020~~ fourth quarter ~~and~~of 2022. Based on our revised modeling, which included our assumptions regarding future revenue, which we consider to be a Level 3 input, using the relief-from-royalty method, we concluded that it was not necessary to perform a Step 1 impairment test for our WWS trade name indefinite-lived intangible assets as no new triggering events or conditions were identified. During 2021, WWS enjoyed organic growth and operational improvements, and there were no new triggering events or conditions identified as of the first day of our 2021 fourth quarter. Therefore, we completed a qualitative assessment of our WWS trade name, which indicated that it is more likely than not that the fair value of our ~~WWS~~WinDoor trade name ~~exceeds it~~was less than its carrying ~~value.~~value, which resulted in an impairment of our WinDoor trade name of $7.4 million in our fourth quarter of 2022. As of December 30, 2023, and December 31, 2022, the carrying value of our WinDoor trade name was $11.0 million and $11.0 million, respectively.

For our other indefinite-lived trade names, we completed qualitative assessments of these assets on the first day of our fourth quarter of ~~2021.~~2023. These qualitative assessments included an evaluation of relevant events and circumstances that existed at the date of

- 62 -

our assessment. Those events and circumstances included conditions specific to our other indefinite-lived trade names, such as the industry in which we use these other indefinite-lived trade names, our competitive environment, the availability and costs of raw materials and labor, the financial performance of our Company, and factors related to the markets in which our Company operates. We also considered that, for our other indefinite-lived trade names, no new impairment indicators were identified since the dates of our prior assessments, which were qualitative assessments all other indefinite-lived intangibles other than goodwill. Based on these assessments, we concluded that it is more likely than not that the fair values of our other indefinite-lived trade names exceed their carrying values. As of ~~January 1,~~December 30, 2023, and December 31, 2022, ~~and January 2, 2021,~~excluding the Martin trade name, the carrying values of other indefinite-lived trade names ~~was~~were $~~212.1~~201.0 million and $~~140.8~~201.0 million, respectively.

~~10.~~9. Long-Term Debt

Long-term debt consists of the following:

January 1,

January 2,

2022

2021

(in thousands)

2021 Senior Notes Due 2029 - Senior notes issued on September 24, 2021,
    due October 1, 2029. Interest payable semi- annually, in arrears,
    beginning on April 1, 2022, accruing at a rate of 4.375% per annum
    beginning September 24, 2021.

$
575,000

$
—

2018 Senior Notes Due 2026 - Senior notes issued on August 10, 2018,
    due August 10, 2026. Interest payable semi- annually, in arrears,
    beginning on February 16, 2019, accruing at a rate of 6.75% per
    annum beginning August 10, 2018.

—

365,000

2016 Credit Agreement Due 2024 - Term loan payable with no
    contractually scheduled amortization payments. Original
    lump-sum payment of $60.0 million due on October 31, 2024.
    Interest payable quarterly at LIBOR or the Base prime rate
    plus an applicable margin. At January 1, 2022, the average
    rate was 2.10%. At January 2, 2021, the average rate
    was 2.15%.

60,000

54,000

Long-term debt

635,000

419,000

Fees, costs, premium and discount (1)

(9,345
)

(6,902
)

Long-term debt, net

625,655

412,098

Less current portion of long-term debt

-

-

Long-term debt, net, less current portion

$
625,655

$
412,098

- 7263 -


	December 30,			December 31,
	2023			2022
	(in thousands)
2021 Senior Notes Due 2029 - Senior notes issued on September 24, 2021, due October 1, 2029. Interest payable semi- annually, in arrears, beginning on April 1, 2022, accruing at a rate of 4.375% per annum beginning September 24, 2021.	$	575,000		$	575,000

2016 Credit Agreement Due 2027 - Revolving credit facility with no contractually scheduled amortization payments. Outstanding balance, if any, due on October 12, 2027. Interest payable at SOFR or the Base prime rate plus an applicable margin, due at the end of each SOFR term or Base loan term plus an applicable margin. At December 30, 2023, the average rate was 7.11%, including a SOFR rate of 5.36% and an applicable margin of 1.75%. At December 31, 2022, the average rate was 6.07%, including a SOFR rate of 4.32% and an applicable margin of 1.75%.		45,000			76,352

Long-term debt		620,000			651,352

Fees, costs, and discount (1)		(7,898	)		(9,218	)

Long-term debt, net		612,102			642,134

Less current portion of long-term debt		—			—

Long-term debt, net, less current portion	$	612,102		$	642,134

(1)

Fees, costs, ~~premium~~ and discount represents third-party fees, lender fees, other debt-related costs, and original issue premium and discount, recorded as a net reduction of the carrying value of debt and are amortized over the lives of the debt instruments to which they relate under the effective interest method.

2021 Senior Notes due 2029

As of ~~January 1, 2022,~~December 30, 2023, the face value of debt outstanding under the 2021 Senior Notes due 2029 was $575.0 million, and accrued interest ~~totaled~~was $~~6.8~~6.3 million. Proceeds from the 2021 Senior Notes due 2029 were used, in part, to redeem in full the $425.0 million of 2018 Senior Notes due 2026, including the related fees, costs and the prepayment call premium ~~discussed further below,~~of $21.5 million, representing 5.063% of the $425.0 million face value then outstanding, prepay the outstanding term loan borrowings under the then existing 2016 Credit Agreement ~~due~~ 2024 of $~~54.0~~60.0 million and the related fees and costs, and finance the Anlin Acquisition in the fourth quarter of 2021. ~~See Note 5, Acquisitions, for a discussion of the Anlin Acquisition.~~

- 64 -

However, upon the occurrence of a change of control, as defined in the indenture, the Company is required to offer to repurchase the notes at 101% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase. We also may make optional redemptions at various premiums including a make-whole call at the then current treasury rate plus 50 basis points prior to October 1, 2024, then 102.188% on or after August 1, ~~2021,~~2024, 101.094% on or after August 2025, then at 100.000% on or after August 1, 2026.

The indenture for the 2021 Senior Notes due 2029 includes certain covenants limiting the ability of the Company and any guarantors to, (i) incur additional indebtedness; (ii) pay dividends on or make distributions in respect of capital stock or make certain other restricted payments or investments; (iii) enter into agreements that restrict distributions from restricted subsidiaries; (iv) sell or otherwise dispose of assets; (v) enter into transactions with affiliates; (vi) create or incur liens; merge, consolidate or sell all or substantially all of the Company’s assets; (vii) place restrictions on the ability of subsidiaries to pay dividends or make other payments to the Company; and (viii) designate the Company’s subsidiaries as unrestricted subsidiaries. These covenants are subject to a number of important exceptions and qualifications.

~~2018 Senior Notes Due 2026~~

~~On August 10, 2018, we completed the issuance of $315.0~~ ~~million aggregate principal amount of~~ ~~6.75% senior notes (“2018 Senior Notes due 2026”), issued at~~ ~~100~~% of their principal amount. The 2018 Senior Notes due 2026 were jointly and severally and fully and unconditionally guaranteed on a senior unsecured basis by each of the Company’s existing and future restricted subsidiaries, other than any restricted subsidiary of the Company that does not guarantee the existing senior secured credit facilities or any permitted refinancing thereof. The 2018 Senior Notes due 2026 were senior unsecured obligations of the Company and the guarantors, respectively, and ranked pari passu in right of payment with all existing and future senior debt and senior to all existing and future subordinated debt of the Company and the guarantors. The 2018 Senior Notes due 2026 were offered under Rule 144A of the Securities Act, and in transactions outside the United States under Regulation S of the Securities Act, and were not registered under the Securities Act.

~~On January 24, 2020, we completed an add-on issuance of $50.0~~ ~~million aggregate principal amount of~~ ~~6.75% 2018 Senior Notes due 2026, or the First Additional Senior Notes, issued at~~ ~~106.375% of their principal amount, resulting in a premium to us of $3.2~~ ~~million. The First Additional Senior Notes were part of the same issuance of, and ranked equally and formed a single series with,~~

~~- 73~~ -

~~the 2018 Senior Notes due 2026. Proceeds from the First Additional Senior Notes, including premium, were used, together with cash on hand, to pay the $90.4~~ ~~million purchase price in the NewSouth Acquisition.~~

~~On January 25, 2021, we completed a second add-on issuance of $60.0~~ ~~million aggregate principal amount of~~ ~~6.75% 2018 Senior Notes due 2026, or the Second Additional Senior Notes, issued at~~ ~~105.5% of their principal amount, resulting in a premium to us of $3.3~~ million. The Second Additional Notes were part of the same issuance of, and ranked equally and form a single series with, the 2018 Senior Notes due 2026. Proceeds from the Second Additional Senior Notes, including premium, were used, together with $~~31.1~~ ~~million in cash on hand, to pay the $94.4~~ ~~million cash portion of the $100.5~~ ~~million purchase price in the ECO Acquisition.~~

~~The 2018 Senior Notes due 2026 were to mature on~~ ~~August 10, 2026. However, effective on September 27, 2021, using proceeds from the issuance of the $575.0~~ ~~million 2021 Senior Notes due 2029, discussed above, we redeemed in-full the $425.0~~ ~~million of 2018 Senior Notes due 2026, including accrued and unpaid interest through September 27, 2021, which totaled $4.5~~ ~~million, and a pre-payment call premium of~~ ~~5.063% of face value, which totaled $21.5~~ ~~million and are classified as debt extinguishment costs in the accompanying consolidated statement of operations for the year ended January 1, 2022.~~

2016 Credit Agreement due ~~2024~~2027

On February 16, 2016, we entered into the 2016 Credit ~~Agreement due 2024, among us, the lending institutions identified in~~Agreement. From 2016 to 2022, we entered into various amendments to the 2016 Credit Agreement, ~~due 2024, and Truist Financial Corporation (formerly known~~including the amendment in October 2022, as ~~SunTrust Bank), as Administrative Agent and Collateral Agent. The 2016 Credit Agreement due 2024 establishes senior secured credit facilities in an aggregate amount of $310.0~~ ~~million, consisting of a $270.0~~ ~~million Term B term loan facility originally maturing in February 2022 that amortizes on a basis of~~ 1~~% annually during its~~ ~~six-year~~ ~~term, and a $40.0~~ million revolving credit facility originally maturing in February 2021 that included a swing line facility and a letter of credit facility. Our obligations under the 2016 Credit Agreement due 2024 are, subject to exceptions, guaranteed by substantially all of our wholly-owned direct and indirect subsidiaries that are restricted subsidiaries and secured by substantially all of our assets as well as our direct and indirect restricted subsidiaries’ assets.described below.

On ~~March 16, 2018, we~~October 13, 2022, the Company entered into an amendment of ~~our 2016 Credit Agreement due 2024 (the “Second Amendment”).~~ ~~The Second Amendment, among other things, decreased the applicable interest rate margins for the Initial Term Loans (as defined in~~ the 2016 Credit Agreement (the “Fifth Amendment”) due ~~2024).~~ ~~On February 17, 2017, we entered into the first amendment to our 2016 Credit Agreement due 2024, which also resulted in decreases in the applicable margins, but which, unlike the Second~~2027. The Fifth Amendment ~~did not include any changes in lender positions.~~

~~On October 31, 2019, we entered into an amendment of our 2016 Credit Agreement due 2024 (“Third Amendment”). The Third Amendment provided~~provides for, among other things, ~~(i)~~ a~~three-year~~ ~~Term A loan in the then aggregate principal amount of $64.0~~ million (the “Initial Term A Loan”), maturing in October 2022, which refinanced in full our existing Term B term loan facility under the 2016 Credit Agreement due 2024, and had no regularly scheduled amortization, and (ii) a new five-year revolving credit facility in an aggregate principal amount of ~~up to~~ $~~80.0~~250.0 million (the ~~“Revolving~~“New Revolving Credit Facility”)~~, maturing in October 2024, which replaced our then~~. The New Revolving Credit Facility refinances and replaces the previously existing $~~40.0~~80.0 million revolving credit facility under the 2016 Credit Agreement. The Company’s obligations under the 2016 Credit Agreement due ~~2024,~~2027 continue to be secured by substantially all of its and ~~includes a swing-line facility~~its direct and ~~letter of credit facility. The Initial Term A Loan was repaid~~indirect subsidiaries’ assets, and is senior in ~~full with proceeds from~~position to the 2021 Senior Notes due 2029.

~~On October 25, 2021, we entered into an amendment~~Contemporaneously with the Fifth Amendment, the Company drew down $160.0 million of ~~our~~funds available under the New Revolving Credit Facility. Proceeds totaling $61.6 million from the $160.0 million drawdown were used to repay then existing term loan borrowings under the 2016 Credit Agreement ~~due 2024 ("Fourth Amendment"). The Fourth Amendment provides for, among other things, a~~ ~~three-year~~ ~~Term A loan in the aggregate maximum available amount of~~totaling $60.0 million, ~~(the "Incremental Term A Loan"), maturing in October 2024,~~plus accrued interest and fees totaling $1.6 million. As discussed below, the remaining $98.4 million of proceeds ~~from which~~ were used to fund the ~~Anlin~~cash portion of the Martin Acquisition. The ~~Fourth Amendment does not change~~Company has made net repayments of the initial $160.0 million of borrowings under the New Revolving Credit Facility totaling $115.0 million through December 30, 2023.

As of ~~January 1, 2022, there~~December 30, 2023, borrowings outstanding under the $250.0 million New Revolving Credit Facility totaled $45.0 million, and accrued interest was $43 thousand. There were $~~5.3~~8.5 million in letters of credit ~~outstanding and~~outstanding. Availability under the New Revolving Credit Facility at December 30, 2023 totaled $~~74.7~~196.5 million available under the Revolving Facility. Our obligations under the 2016 Credit Agreement due 2024 continue to be secured by substantially all of our assets, as well as our direct and indirect subsidiaries' assets, and is senior in position to the 2021 Senior Notes due 2029.

million. The weighted average all-in interest rate for borrowings under the ~~term-loan portion~~existing revolving credit facility of the 2016 Credit Agreement due 2027 was 7.11% as of December 30, 2023, and for borrowings under the term loan facility of the then existing 2016 Credit Agreement due 2024 was ~~2.10% as of January 1, 2022 and was~~ ~~2.15~~6.07% at ~~January 2, 2021.~~December 31, 2022.

The Martin Acquisition was financed in part with the $250.0 million available under the New Revolving Credit Facility provided by the Fifth Amendment of our 2016 Credit Agreement due 2027, under which we drew $160.0 million on October 14, 2022, the proceeds of which were used to pay $98.4 million of the $188.5 million total fair value of consideration transferred at closing, and $61.6 million to prepay our $60.0 million existing term loans under the Fourth Amendment of our 2016 Credit Agreement due 2027,

- 65 -

plus $1.6 million in fees, costs and accrued interest. The remainder of the total fair value of consideration transferred at closing totaling $90.1 million was funded with cash on hand previously generated through operations.

Deferred Financing Costs

~~- 74~~ -

(in thousands)

Total

At beginning of year

$
6,902

Add: Deferred financing costs from the issuance of the Second Additional Senior Notes

1,363

Less: Premium on the Second Additional Senior Notes

(3,300
)
Less: Write-off of deferred costs classified as debt extinguishment costs

(3,954
)
Add: Deferred financing costs from the issuance of the 2021 Senior Notes due 2029

8,700

Add: Deferred financing costs from the refinancing of the 2016 Credit Agreement

612

Less: Amortization expense

(978
)

At end of year

$
9,345


(in thousands)	Total
At beginning of year	$	9,218
Less: Amortization expense		(1,320	)

At end of year	$	7,898

Estimated amortization expense relating to third-party fees and costs, lender fees and discount for the years indicated, as of ~~January 1, 2022,~~December 30, 2023, is as follows:


(in thousands)	Total		Total
2022	$	1,233
2023		1,282
2024		1,282	$	1,366
2025		1,083		1,442
2026		1,114		1,466
2027				1,440
2028				1,222
Thereafter		3,351		962

Total	$	9,345	$	7,898

The following represents future maturities of long-term debt as of ~~January 1, 2022~~December 30, 2023 (at face value):


(in thousands)	Total		Total
2021	$	0
2022		0
2023		0
2024		60,000	$	—
2025		0		—
2026				—
2027				45,000
2028				—
Thereafter		575,000		575,000

Total	$	635,000	$	620,000

Interest Expense, Net

Interest expense, net consisted of the following:


	Year Ended									Year Ended
	January 1,			January 2,			December 28,			December 30,			December 31,			January 1,
	2022			2021			2019			2023			2022			2022
(in thousands)
Long-term debt	$	28,625		$	26,339		$	24,750		$	30,527		$	27,866		$	28,625
Debt fees		474			327			383			697			433			474
Amortization and write-offs of deferred
financing costs and debt discount		978			1,206			1,674			1,320			1,242			978
Interest income		(27	)		(120	)		(339	)		(1,245	)		(620	)		(27	)

Interest expense		30,050			27,752			26,468			31,299			28,921			30,050
Capitalized interest		(21	)		(33	)		(51	)		(222	)		(42	)		(21	)

Interest expense, net	$	30,029		$	27,719		$	26,417		$	31,077		$	28,879		$	30,029

10. Derivatives

Aluminum Contracts and Midwest Transaction Premium

We enter into aluminum forward contracts to hedge the fluctuations in the purchase price of aluminum extrusion we use in production. ~~Beginning late in the first quarter of 2020, we began entering~~We also enter into forward contracts to hedge the fluctuations in the price of the delivery component of our aluminum extrusion purchases, known as the Midwest Transaction Premium, or MTP. Our contracts are designated as cash flow hedges since they are highly effective in offsetting changes in the cash flows attributable to forecasted purchases of aluminum and the related MTP.

We record our aluminum hedge contracts at fair value, based on trading values for aluminum forward contracts. Aluminum forward contracts identical to those held by us trade on the London Metal Exchange (“LME”). The LME provides a transparent forum and is the world’s largest center for the trading of futures contracts for non-ferrous metals. The prices are used by the metals industry worldwide as the basis for contracts for the movement of physical material throughout the production cycle. Based on this high degree of volume and liquidity in the LME, we believe the valuation price at any measurement date for contracts with identical terms as to prompt date, trade date and trade price as those we hold at any time represents a contract’s exit price to be used for purposes of determining fair value.

We record our MTP hedge contracts at fair value, based on the Platts MW US Transaction price per pound assessment, which has been a benchmark for decades in the North American aluminum industry. Platts surveys the North American market daily to capture trades, bids and offers on a delivered Midwest basis. Data is normalized to reflect the typical price per pound between the largest number of market participants, for delivery within 7 to 30 days from date of publication, net-30-day payment terms, for typical order quantities, chemistries and freight allowances. The survey is extensive and encompasses both domestic and offshore producers, traders and brokers that are varied in scope. Based on the extensive nature of this pricing mechanism, we believe the Platts MW US Transaction price at any time represents a contract’s exit price to be used for purposes of determining fair value.

Guidance under the Financial Instruments Topic 825 of the Codification requires us to record our hedge contracts at fair value and consider our credit risk for contracts in a liability position, and our counter-party’s credit risk for contracts in an asset position, in determining fair value. We assess our counter-party’s risk of non-performance when measuring the fair value of financial instruments in an asset position by evaluating their financial position, including cash on hand, as well as their credit ratings. We assess our risk of non-performance when measuring the fair value of our financial instruments in a liability position by evaluating our credit ratings, our current liquidity including cash on hand and availability under our ~~revolving credit facility~~New Revolving Credit Facility as compared to the maturities of the financial liabilities. Management makes an accounting policy election not to offset the estimated fair value amounts recognized for derivatives executed with the same counterparty under the same master netting arrangement. Our counterparties to our derivative contracts do not require the Company to post collateral against hedge contracts in a liability position, if any.

At ~~January 1, 2022,~~December 30, 2023, the fair value of our aluminum forward contracts was in an asset position of $~~4.8~~0.3 million. We had 219 outstanding forward contracts for the purchase of ~~30.7~~6.6 million pounds of aluminum through ~~December 2022,~~June 2024, at an average price of $~~1.11~~1.04 per pound, which excludes the Midwest premium, with maturity dates of between one month and~~twelve~~ six months. At ~~January 1, 2022, the fair value of our MTP contracts was in an assetposition of $4.6~~ ~~million. We~~December 30, 2023, we had 10no outstanding MTP ~~contracts to~~ hedge ~~the Platt US MW Transaction price per pound for the delivery of~~ ~~23.5~~ ~~million pounds of aluminum through December 2022, at an average price of $0.12~~ ~~per pound, with maturity dates of between~~ ~~one month~~ ~~and~~ ~~twelve months~~.contracts. We assessed the risk of non-performance of the Company and our counterparty, ~~to these contracts,~~ as applicable, and determined it was immaterial and, therefore, did not record any adjustment to ~~their~~the fair ~~values~~value as of ~~January 1, 2022.~~December 30, 2023.

We assess the effectiveness of our cash flow hedges by comparing the change in the fair value of the forward contract to the change in the expected cash to be paid for the hedged item. The gain or loss on our ~~aluminum forward~~hedging contracts is reported as a component of accumulated other comprehensive income (loss) and is reclassified into earnings in the same line item in the income statement as the hedged item in the same period or periods during which the transaction affects earnings. The amount of income, net, recognized in the “accumulated other comprehensive income (loss)” line item in the accompanying ~~condensed~~ consolidated balance sheet as of ~~January 1, 2022,~~December 30, 2023, that we expect will be reclassified to earnings within the next twelve months, is ~~approximately~~ $~~9.4~~0.3 million.

~~- 76~~ -

The fair values of our aluminum hedges and MTP contracts are classified in the accompanying ~~condensed~~ consolidated balance sheets at ~~January 1,~~December 30, 2023, and December 31, 2022, ~~and January 2, 2021,~~ as follows (in thousands):

Derivative Assets

Derivative (Liabilities)

January 1, 2022

January 1, 2022

Derivatives designated as hedging

instruments under Subtopic 815-20:

Balance Sheet Location

Fair Value

Balance Sheet Location

Fair Value

Derivative instruments:

Aluminum forward contracts

Other current assets

$
4,829

Accrued liabilities

$
—

MTP contracts

Other current assets

4,599

Accrued liabilities

—

Aluminum forward contracts

Other assets

—

Other liabilities

—

MTP contracts

Other assets

—

Other liabilities

—

Total derivative instruments

Total derivative assets

$
9,428

Total derivative liabilities

$
—

Derivative Assets

Derivative (Liabilities)

January 2, 2021

January 2, 2021

Derivatives designated as hedging

instruments under Subtopic 815-20:

Balance Sheet Location

Fair Value

Balance Sheet Location

Fair Value

Derivative instruments:

Aluminum forward contracts

Other current assets

$
3,243

Accrued liabilities

$
(28
)
MTP contracts

Other current assets

423

Accrued liabilities

(24
)
Aluminum forward contracts

Other assets

—

Other liabilities

(25
)
MTP contracts

Other assets

26

Other liabilities

(4
)
Total derivative instruments

Total derivative assets

$
3,692

Total derivative liabilities

$
(81
)

- 67 -

Derivative Assets

Derivative (Liabilities)

December 30, 2023

Derivatives designated as hedging

instruments under Subtopic 815-20:

Balance Sheet Location

Fair Value

Balance Sheet Location

Fair Value

Derivative instruments:

Aluminum forward contracts

Other current assets

257

Accrued liabilities

—

MTP contracts

Other current assets

—

Accrued liabilities

—

Aluminum forward contracts

Other assets

—

Other liabilities

—

MTP contracts

Other assets

—

Other liabilities

—

Total derivative instruments

Total derivative assets

257

Total derivative liabilities

—

Derivative Assets

Derivative (Liabilities)

December 31, 2022

Derivatives designated as hedging

instruments under Subtopic 815-20:

Balance Sheet Location

Fair Value

Balance Sheet Location

Fair Value

Derivative instruments:

Aluminum forward contracts

Other current assets

—

Accrued liabilities

—

MTP contracts

Other current assets

300

Accrued liabilities

—

Aluminum forward contracts

Other assets

—

Other liabilities

—

MTP contracts

Other assets

—

Other liabilities

—

Total derivative instruments

Total derivative assets

300

Total derivative liabilities

—

The ending accumulated balance for the aluminum forward and MTP contracts included in accumulated other comprehensive ~~losses,~~income, net of tax, was $~~7.0~~0.2 million as of ~~January 1, 2022,~~December 30, 2023, and $~~2.7~~0.2 million as of ~~January 2, 2021.~~December 31, 2022.

The following represents the gains (losses) on derivative financial instruments, and their classifications within the accompanying consolidated financial statements for the three years ended ~~January 1, 2022~~December 30, 2023 (in thousands):

Derivatives in Cash Flow Hedging Relationships

Amount of Gain or (Loss) Recognized in OCI(L) on Derivatives

Location of Gain or (Loss) Reclassified from Accumulated OCI(L) into Income

Amount of Gain or (Loss) Reclassified from Accumulated OCI(L) into Income

Amount of Gain or (Loss) Recognized in OCI(L) on Derivatives

Location of Gain or (Loss) Reclassified from Accumulated OCI(L) into Income

Amount of Gain or (Loss) Reclassified from Accumulated OCI(L) into Income

Year Ended

December 28, 2019

Aluminum contracts

($1,229)

Cost of sales

($5,030)

Year Ended

January 2, 2021

January 1, 2022

Aluminum contracts

$1,037

Cost of sales

($2,470)

$14,012

Cost of sales

$12,373

MTP contracts

$532

Cost of sales

$111

$10,443

Cost of sales

$6,265

January 1, 2022

December 31, 2022

Aluminum contracts

$14,012

Cost of sales

$12,373

($7,732)

Cost of sales

($2,903)

MTP contracts

$10,443

Cost of sales

$6,265

$42

Cost of sales

$4,341

December 30, 2023

Aluminum contracts

($361)

Cost of sales

($618)

MTP contracts

($94)

Cost of sales

$206

We classify cash flows related to derivative instruments as operating activities in the accompanying consolidated statements of cash flows.

11. Fair Value

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. A three-tier fair value hierarchy is used to prioritize the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted market prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The three levels of the fair value hierarchy are as follows:

Level 1 Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

~~- 77~~ -

Level 2 Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3 Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.

The accounting guidance concerning fair value allows us to elect to measure financial instruments at fair value and report the changes in fair value through earnings. This election can only be made at certain specified dates and is irrevocable once made. We do not have a policy regarding specific assets or liabilities to elect to measure at fair value, but rather we make the election on an instrument-by-instrument basis as they are acquired or incurred.

During ~~2021, 2020,~~2023, 2022, or ~~2019,~~2021, we did 0not make any transfers between Level 1, Level 2 or Level 3 financial assets. We conduct reviews on a quarterly basis to verify pricing, assess liquidity, and determine if significant inputs have changed that would impact the fair value hierarchy disclosure.

Fair Value of Financial Instruments

Our financial instruments include cash equivalents, accounts and notes receivable, accounts payable, and accrued liabilities, whose carrying amounts approximate their fair values due to their short-term nature. Our financial instruments also include borrowings under the revolving credit facility of our 2016 Credit Agreement due ~~2024~~2027, as well as the 2021 Senior Notes due ~~2019~~2029 at ~~January 1,~~December 30, 2023 and December 31, 2022, ~~and 2018 Senior Notes due 2026 at January 2, 2021,~~ all classified as long-term debt. The fair value of borrowings under the revolving credit facility of our 2016 Credit Agreement due ~~2024~~2027 approximates its carrying value due to its variable interest rate nature, and was approximately $~~60.0~~45.0 million as of ~~January 1,~~December 30, 2023, compared to a principal outstanding value of $45.0 million, and $76.4 million as of December 31, 2022, compared to a principal outstanding value of $~~60.0~~ ~~million, and $54.0~~ ~~million as of January 2, 2021, compared to a principal outstanding value of $54.0~~76.4 million. The fair value of the 2021 Senior Notes due 2029 is also based on debt with similar terms and characteristics and was approximately $~~578.2~~549.1 million as of ~~January 1, 2022,~~December 30, 2023, compared to a principal outstanding value of $575.0 million, and ~~of the 2018 Senior Notes due 2026 of~~ $~~387.8~~480.8 million as of ~~January 2, 2021,~~December 31, 2022, compared to a principal outstanding value of $~~365.0~~575.0 million. Fair values were determined based on observed trading prices of our debt between domestic financial institutions, which we consider to be Level 2 inputs.

The carrying amounts for financial instruments measured at fair value are as follows:


	Fair Value Measurements								Fair Value Measurements
	Assets (Liabilities)								Assets (Liabilities)
			Quoted		Significant						Quoted		Significant
			Prices in		Other		Significant				Prices in		Other		Significant
			Active		Observable		Unobservable				Active		Observable		Unobservable
			Markets		Inputs		Inputs				Markets		Inputs		Inputs
January 1, 2022	Total		(Level 1)		(Level 2)		(Level 3)
December 30, 2023									Total		(Level 1)		(Level 2)		(Level 3)
Description
Aluminum forward contracts	$	4,829	$	—	$	4,829	$	—	$	257	$	—	$	257	$	—
MTP contracts		4,599		—		4,599		—		—		—		—		—

	$	9,428	$	—	$	9,428	$	—	$	257	$	—	$	257	$	—

January 2, 2021	Total		(Level 1)		(Level 2)		(Level 3)
December 31, 2022									Total		(Level 1)		(Level 2)		(Level 3)
Description
Aluminum forward contracts, net	$	3,190	$	—	$	3,190	$	—	$	—	$	—	$	—	$	—
MTP contracts, net		421		—		421		—		300		—		300		—

	$	3,611	$	—	$	3,611	$	—	$	300	$	—	$	300	$	—

12. Income Taxes

Income Tax Expense

The components of income tax expense are as follows (in thousands):


	Year Ended							Year Ended
	January 1,		January 2,			December 28,		December 30,		December 31,			January 1,
	2022		2021			2019		2023		2022			2022
Current:
Federal	$	790	$	9,906		$	5,747	$	24,402	$	34,411		$	790
State		1,337		2,571			2,282		6,856		9,595			1,337

Total current tax expense									31,258		44,006			2,127
		2,127		12,477			8,029
Deferred:
Federal		7,142		528			3,179		5,506		(8,661	)		7,142
State		490		(1,121	)		1,231		1,246		(2,679	)		490

		7,632		(593	)		4,410
Total deferred tax expense (benefit)									6,752		(11,340	)		7,632

Income tax expense	$	9,759	$	11,884		$	12,439	$	38,010	$	32,666		$	9,759

The aggregate amount of income taxes included in the consolidated statements of operations and consolidated statements of shareholders’ equity are as follows (in thousands):


	Year Ended									Year Ended
	January 1,			January 2,			December 28,			December 30,		December 31,		January 1,
	2022			2021			2019			2023		2022		2022
Consolidated statements of operations:
Income tax expense relating to continuing operations	$	9,759		$	11,884		$	12,439		$	38,010	$	32,666	$	9,759

Consolidated statements of shareholders' equity:
Income tax expense relating to derivative financial instruments	$	(1,531	)	$	(970	)	$	(974	)
Income tax benefit (expense) relating to derivatives										$	11	$	2,345	$	(1,531	)

Reconciliation of the Statutory Rate to the Effective Rate

A reconciliation of the statutory federal income tax rate to our effective rate is provided below:


	Year Ended									Year Ended
	January 1,			January 2,			December 28,			December 30,			December 31,			January 1,
	2022			2021			2019			2023			2022			2022
Statutory federal income tax rate		21.0	%		21.0	%		21.0	%		21.0	%		21.0	%		21.0	%
State income taxes, net of federal income tax benefit		3.2	%		3.7	%		4.0	%		4.6	%		4.7	%		3.2	%
Non-deductible expenses		1.3	%		1.0	%		1.6	%		3.0	%		1.3	%		1.3	%
Research activities credits											(0.9	)%		(1.2	)%		(0.8	)%
Florida excess tax refund relating to the Tax Cuts and Jobs Act											—			(0.4	)%		—
Eco partnership income attributable to non-controlling interest		(1.2	)%		—			—			(0.2	)%		(0.3	)%		(1.2	)%
Florida excess tax refund relating to the Tax Cuts and Jobs Act		—			(1.0	)%		—
Excess stock-based compensation tax benefits		(2.0	)%		(1.4	)%		(3.7	)%		(1.4	)%		(0.1	)%		(2.0	)%
Research activities credits		(0.8	)%		(2.3	)%		(1.2	)%
Changes related to state rate changes and U.S. tax reform		—			—			0.7	%
Other		0.2	%		(0.1	)%		(0.2	)%		(0.4	)%		(0.1	)%		0.2	%

Consolidated effective tax rate		21.7	%		20.9	%		22.2	%		25.7	%		24.9	%		21.7	%

- 7970 -

Deferred Income Taxes

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of our net deferred tax liability are as follows:


	January 1,			January 2,			December 30,			December 31,
	2022			2021			2023			2022
	(in thousands)						(in thousands)
Deferred tax assets:
Operating lease liability	$	16,949		$	10,609		$	34,517		$	21,496
Deferrals and accruals relating to ASC 606, net		6,580			3,537			5,530			5,707
State bonus depreciation and net operating loss carryforwards		3,748			2,606
State bonus depreciation and tax credits								3,897			3,926
Stock-based compensation expense		2,527			1,772			2,113			2,926
Accrued warranty		2,380			1,550			3,900			3,564
Acquisition costs		2,158			1,664			3,354			2,236
Advance supplier consideration		2,109			2,776			664			1,388
Other deferrals and accruals, net		1,848			2,206			9,247			10,039
Obsolete inventory and UNICAP adjustment		1,666			788
Obsolete inventory, UNICAP and other related items								—			4,054
Allowance for credit losses		1,048			1,017			4,216			3,885

Total deferred tax assets		41,013			28,525			67,438			59,221

Deferred tax liabilities:
Property, plant and equipment		(20,958	)		(14,966	)		(21,453	)		(21,257	)
Trade names and other intangible assets, net		(18,162	)		(17,978	)		(38,221	)		(39,193	)
Goodwill		(17,102	)		(12,596	)		(23,823	)		(21,303	)
Operating lease right-of-use asset		(15,371	)		(9,742	)		(31,741	)		(19,655	)
Obsolete inventory, UNICAP and other related items								(2,612	)		—
Eco partnership basis difference		(3,110	)		—			—			(2,921	)
Derivative financial instruments		(2,421	)		(892	)		(66	)		(77	)
Prepaid expenses		(1,378	)		(680	)		(2,207	)		(2,222	)

Total deferred tax liabilities		(78,502	)		(56,854	)		(120,123	)		(106,628	)

Total deferred tax liabilities, net	$	(37,489	)	$	(28,329	)	$	(52,685	)	$	(47,407	)

~~Tax-Deductible~~Tax Basis in Goodwill

We acquired goodwill deductible for tax purposes in the CGI acquisition as the transaction was treated as an acquisition of stock for tax purposes. At the date of the acquisition, the amount of goodwill deductible for tax purposes from the CGI acquisition was $~~9.3~~ ~~million. At the time of the acquisition, this goodwill was the same amount for both book and tax purposes and, therefore,~~ 0 ~~deferred tax asset or liability was recognized. As we amortize this goodwill for tax purposes over its remaining life, which was approximately~~ ~~7.4~~ ~~years at the time of the acquisition, we will recognize a deferred tax liability. The unamortized amount of this goodwill was $0.2~~ ~~million and $1.5~~ ~~million at January 1, 2022, and January 2, 2021, respectively.~~

We have goodwill deductible for tax purposes in ~~the WinDoor acquisition~~certain of our acquisitions as the ~~transaction was an acquisition~~transactions were acquisitions of stock ~~that was~~ treated as a step-up ~~acquisition~~acquisitions of assets and assumption of liabilities pursuant to ~~our election~~elections under section 338(h)(10) or 743(b) of the Internal Revenue ~~Code. We are deducting goodwill for tax purposes~~Code, or the transactions were structured as acquisitions of $~~38.9~~ ~~million from the WinDoor transaction.~~assets and assumptions of liabilities. The unamortized amount of this goodwill ~~was $23.5~~ ~~million and $26.1~~ ~~million at January 1, 2022, and January 2, 2021, respectively.~~

~~We have goodwill deductible~~ for tax purposes, inincluding the ~~US Impact acquisition~~goodwill as a result of the ~~transaction~~Anlin Acquisition discussed below.

In the Martin Acquisition, we acquired goodwill. Because the Martin Acquisition was ~~treated~~structured as an acquisition of ~~assets and assumption~~the stock of ~~liabilities for both book and tax purposes. We expect to be able to deduct goodwill for tax purposes of $569~~ ~~thousand from the USI transaction. The unamortized amount of this goodwill was $364~~ ~~thousand and $402~~ ~~thousand at January 1, 2022, and January 2, 2021, respectively.~~

~~- 80~~ -

W~~e completed the WWS Acquisition, which included its subsidiary, WWS Blocker LLC (“Blocker”), on~~ ~~August 13, 2018. Blocker was~~ a ~~single-purpose U.S. tax blocker which held~~C corporation, a ~~18.06% ownership percentage~~step-up election is not available. Therefore, we do not believe any of the ~~combined ownership of WWS, and for which that portion~~goodwill as a result of the ~~fair value of assets acquired and liabilities assumed in the WWS~~Martin Acquisition ~~was not eligible for a step-up in basis. We have goodwill deductible for tax purposes in the WWS Acquisition. Goodwill relating to the~~ ~~81.94% portion of the transaction treated as a step-up acquisition of assets and assumption of liabilities totaled $133.6~~ ~~million. We expect to be able to deduct this goodwill for tax purposes. The unamortized amount of this goodwill was approximately $103.1~~ ~~million and $112.1~~ ~~million at January 1, 2022, and January 2, 2021, respectively. WWS has historical tax goodwill, of which the~~ ~~18.06% portion of the Blocker treated as an acquisition of stock not eligible for step-up totaled $6.0~~ ~~million. The unamortized portion of this goodwill was approximately $4.3~~ ~~million and $4.8~~ ~~million at January 1, 2022, and January 2, 2021, respectively. This component can continue to be deducted by the Company for tax purposes.~~

We have goodwill deductible for tax purposes in the NewSouth Acquisition as the transaction was treated as an acquisition of assets and assumption of liabilities for both book and tax purposes. In the transaction, there were no earn-out arrangements or separate asset allocation agreements with sellers that we believe would affect the deductibility of goodwill in the acquisition. As such, we expect to be able to deduct goodwill for tax purposes of $~~52.1~~ ~~million. The unamortized amount of this goodwill was $45.4~~ ~~million at January 1, 2022, and $48.9~~ ~~million at January 2, 2021.~~

~~In February 2021, we acquired Eco in a transaction treated as a~~ 75% investment in a partnership which we believe will elect to be treated as an asset acquisition pursuant to Section 743(b) of the Code. As such, although the Eco Acquisition created goodwill for book purposes, our share of the tax deductible goodwill created in this transaction will benefit us through our share of partnership earnings, which will include, among other things, its tax deductible goodwill.

In our acquisition of CRi, we acquired goodwill which we believe is tax deductible as the transaction was structured as a purchase of assets and assumption of certain liabilities for both book and tax. In the transaction there were no earn-out arrangements or separate asset allocation agreements with the sellers that we believe would affect the deductibility of goodwill in the transaction. as such, we believe the goodwill acquired of $~~3.7~~ ~~million~~ is deductible for tax purposes. ~~The unamortized amount of this goodwill was $3.5~~ ~~million at January 1, 2022.~~

In the Anlin Acquisition, we acquired goodwill which we believe is currently not tax deductible as a result of an earn-out agreement associated with this transaction, the fair value of which exceeds the amount of the goodwill acquired. Payments under this earn-out agreement have not been finalized as of January 1, 2022. As such, we are unable to estimate the amount of goodwill that may be deductible, if any, in the Anlin Acquisition.

Excess Tax Benefits

Excess tax benefits resulting from the exercise of stock options and lapse of restriction on stock awards are ~~now~~ recognized as a ~~discrete item in~~component of tax ~~expense, where previously such tax effects had been recognized in additional paid-in-capital.~~expense. Income tax expense in the years ended December 30, 2023, December 31, 2022, and January 1, 2022, ~~January 2, 2021, and December 28, 2019,~~ includes excess tax benefits totaling $~~0.9~~2.0 million, $~~0.8~~0.2 million, and $~~2.1~~0.9 million, respectively.

Income Taxes Payable and Payments

Accrued liabilities at December 30, 2023 and December 31, 2022 include income taxes currently payable of $7.0 million and $16.4 million, respectively. During the years ended December 30, 2023 and December 31, 2022, we made payments of income taxes totaling $40.6 million and $21.5 million, respectively.

- 71 -

Income Tax Effects of Accumulated Other Comprehensive Income (Loss)

We reclassify to the income tax effects of accumulated other comprehensive income (loss) to income taxes in the same period as the reclassification of the related item of accumulated other comprehensive income (loss) to earnings.

Open Tax Years

The tax years ~~2014~~2019 to ~~2020~~2022 remain open for ~~examination by the IRS and Florida due to the statute of limitations and net operating losses utilized in prior tax years.~~examination.

~~14.~~13. Leases, Commitments and Contingencies

Leases

We lease certain of our manufacturing facilities under operating leases. We also lease production equipment, vehicles, computer equipment, storage units and office equipment under operating leases. Our leases have remaining lease terms of 1 year to 1012 years, some of which may include options to extend the leases for up to 5 years, and some of which may include options to terminate the leases within 1 year. All of our leases are operating leases. We did not recognize right-of-use assets or lease liabilities for certain short-term leases that are month-to-month leases. As of ~~January 1, 2022,~~December 30, 2023, we had no additional operating or finance leases that have not yet commenced. Our operating leases expire at various times through ~~2032.~~2035. Lease expense for the years ended December 30, 2023, December 31, 2022, and January 1, 2022, ~~and January 2, 2021,~~ totaled $~~25.1~~34.4 million, $30.7 million, and $~~13.0~~25.1 million, respectively, and includes $~~10.6~~18.1 million, $15.6 million, and $~~6.6~~10.6 million, respectively, classified in cost of sales in the accompanying consolidated statement of operations, with the remainder as selling, general and administrative expenses.

~~- 81~~ -

The components of lease expense for the years ended December 30, 2023, December 31, 2022 and January 1, 2022, ~~and January 2, 2021~~ are as ~~follows. Certain amounts in the prior year period have been reclassified to conform to the current presentation~~follows (in thousands):


	Year Ended				Year Ended
	January 1,		January 2,		December 30,		December 31,		January 1,
	2022		2021		2023		2022		2022
Operating lease cost	$	15,254	$	9,165	$	23,944	$	20,490	$	15,254
Short-term lease cost		9,872		3,856		10,493		10,175		9,872
Total lease cost	$	25,126	$	13,021	$	34,437	$	30,665	$	25,126

Other information relating to leases for the years ended ~~January 1,~~December 30, 2023, December 31, 2022 and January ~~2, 2021,~~1, 2022,, are as follows (in thousands, except years and percentages):


	Year Ended						Year Ended
	January 1,			January 2,			December 30,			December 31,			January 1,
	2022			2021			2023			2022			2022
Supplemental cash flows information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows relating to operating leases	$	(13,750	)	$	(8,822	)	$	(22,966	)	$	(19,635	)	$	(13,750	)

Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	65,678		$	19,185		$	44,424		$	29,031		$	65,678

Weighted average remaining lease term in years
Operating leases		7.04			6.84			6.91			7.12			7.04

Weighted average discount rate
Operating leases		5.5	%		5.8	%		5.3	%		5.2	%		5.5	%

- 72 -

Future minimum lease commitments for operating leases are as follows (in thousands):


	January 1,			January 2,			December 30,
	2022			2021			2023
2021	$	-		$	8,327
2022		17,929			7,626
2023		17,577			7,149
2024		16,990			6,748		$	26,687
2025		15,987			6,253			25,943
2026		15,025			6,130			24,480
2027								23,400
2028								19,376
Thereafter		32,249			7,670			39,849

Total future minimum lease payments		115,757			49,903			159,735

Less: Imputed interest		(18,674	)		(8,641	)		(25,337	)

Operating lease liability - total	$	97,083		$	41,262		$	134,398

Reported as of January 1, 2022 and January 2, 2021:
Reported as of December 30, 2023:
Current portion of operating lease liability	$	13,180		$	6,132		$	20,368
Operating lease liability, less current portion		83,903			35,130			114,030

Operating lease liability - total	$	97,083		$	41,262		$	134,398

Purchase Commitments

We are obligated to purchase certain raw materials used in the production of our products from certain suppliers pursuant to stocking programs. If these programs were cancelled by us, as of ~~January 1,~~December 30, 2023, and December 31, 2022, we would be required to pay $~~21.6~~30.6 million and $26.1 million, respectively, for various materials. During the years ended December 30, 2023, December 31, 2022, and January 1, 2022, ~~January 2, 2021, and December 28, 2019,~~ we made purchases under these programs totaling $~~262.4~~459.9 million, $~~227.4~~454.6 million and $~~216.0~~262.4 million, respectively. The Company expects to utilize its purchase commitments in its normal ongoing operations.

~~- 82~~ -

At ~~January 1, 2022,~~December 30, 2023, we had $~~5.3~~8.5 million in standby letters of credit related to our workers’ compensation insurance coverage.

Legal Proceedings

We are a party to various legal proceedings in the ordinary course of business. Although the ultimate disposition of those proceedings cannot be predicted with certainty, management believes the outcome of any claim that is pending or threatened, either individually or on a combined basis, will not have a materially adverse effect on our operations, financial position or cash flows.

~~18.~~17. Stock-Based Compensation

2019 Equity Plan

On May 22, 2019, our shareholders approved, and we adopted the 2019 Equity and Incentive Compensation Plan (the “2019 Equity Plan”) whereby equity-based awards of up to a total of 1,550,000 shares may be granted by the Board to eligible non-employee directors, selected officers and other employees, advisors and consultants of ours. A summary of certain key features and terms of the 2019 Equity Plan is set forth below. A more complete discussion about the 2019 Equity Plan is set forth in the Company’s proxy statement for its 2019 annual meeting of stockholders, which was filed with the SEC on April 23, 2019.

On June 10, 2022, our shareholders approved, and we adopted, the Amended and Restated 2019 Equity and Incentive Compensation Plan (the "Amended and Restated 2019 Equity Plan") which, among other things, increase the total number of shares of common stock available for grant by 3,000,000 shares. A more complete discussion about the Amended and Restated 2019 Equity Plan is set forth in the Company’s proxy statement for its 2019 annual meeting of stockholders, which was filed with the SEC on June April 29, 2022.

Amended and Restated 2019 Equity and Incentive Compensation Plan

• sets forth the total number of shares of common stock available for grant thereunder, at ~~1,550,000~~4,550,000, shares,

• sets forth the types of awards eligible under the plan, including issuances of options, share appreciation rights, restricted shares, restricted share units, share bonuses, other share-based awards and cash awards, and

• sets forth the maximum number of shares that may be made subject to awards in any calendar year to any “covered employee” (within the meaning of Section 162(m) of the Internal Revenue Code).

• shares previously granted under predecessor plans, including the 2014 Equity Plan and the 2006 Equity Plan, may be available for issuance under the 2019 Equity Plan under certain circumstances described below.

There were ~~558,220~~2,766,235 shares available for grant under the Amended and Restated 2019 Equity Plan at ~~January 1, 2022.~~December 30, 2023.

~~2014 Equity Plan~~

On March 28, 2014, we adopted the 2014 Omnibus Equity Incentive Plan (the “2014 Equity Plan”) whereby equity-based awards may be granted by the Board to eligible non-employee directors, selected officers and other employees, advisors and consultants of ours. On May 7, 2014, our stockholders approved the 2014 Equity Plan.

~~2014 Omnibus Equity Incentive Plan~~

~~• sets forth the total number of shares of common stock available for grant thereunder, at~~ ~~1,500,000~~,

~~• sets forth the maximum number of shares that may be made subject to awards in any calendar year to any “covered employee” (within the meaning of Section 162(m) of the Internal Revenue Code).~~

~~With the adoption of the 2019 Equity Plan effective on May 22, 2019,~~ 0 ~~further shares will be granted and, therefore,~~ 0 shares are available under the 2014 Equity Plan. However, a previously issued grant under the 2014 Equity Plan that is cancelled or forfeited, expires, is settled for cash, or is unearned, is available to be issued under the 2019 Equity Plan.

~~2006 Equity Plan~~

On June 6, 2006, we adopted the 2006 Equity Incentive Plan (the “2006 Equity Plan”) whereby equity-based awards could be granted by the Board to eligible non-employee directors, selected officers and other employees, advisors and consultants of ours. On April 6, 2010, our stockholders approved the PGT Innovations, Inc. (formerly PGT, Inc.) Amended and Restated 2006 Equity Incentive Plan (the “Amended and Restated 2006 Equity Incentive Plan”). With the adoption of the 2014 Equity Plan effective on March 28, 2014, 0 ~~further shares were granted under and, therefore,~~ 0 shares were available under the Amended and Restated 2006 Equity Incentive Plan. However, a previously issued grant made under the Amended and Restated 2006 Equity Incentive Plan that is cancelled or forfeited, expires, is settled for cash, or is unearned, is available to be issued under the 2019 Equity Plan.

~~- 84~~ -

~~Recent~~ Issuances

On February 15, ~~2021,~~2023, we issued ~~289,210~~524,114 shares of restricted stock to certain executive and non-executive employees of the Company, under the Company’s ~~2021~~2023 long-term incentive plan (“~~2021~~2023 LTIP”). The final number of half of the shares awarded under the ~~2021~~2023 LTIP, or ~~144,605~~262,057 shares, is subject to adjustment based on the performance of the Company for the ~~2021~~2023 fiscal year and was not final as of ~~January 1, 2022.~~December 30, 2023. Additionally, ~~a portion of~~ the ~~144,605~~262,057 performance shares issued under the ~~2021~~2023 LTIP are subject to a total shareholder return ("TSR") component, which will not be finalized until the third anniversary of the February 15, ~~2021 grants~~2023 grant date. Specifically, 37.5% of the one-half of the restricted stock awarded in the ~~2021~~2022 LTIP are performance restricted shares which will not be earned unless certain financial performance metrics are met by the Company for the ~~2021~~2023 fiscal year. The performance criteria, as defined in the share awards, provide for a graded awarding of shares based on the percentage by which the Company meets earnings before interest, taxes, depreciation and amortization ("EBITDA") as defined in our ~~2021~~2023 business plan. The percentages, ranging from less than 80% to greater than or equal to 120% of the target amount of that EBITDA metric, provide for the awarding of shares ranging from 0% to 200% of the target amount of shares with respect to 37.5% of half of the ~~289,210~~524,114 shares, or ~~54,227~~98,273 shares. The remaining 62.5% of the one-half of the restricted stock awarded in the ~~2021~~2022 LTIP, or ~~90,378~~163,784 shares, are subject to the same EBITDA metric, but are also subject to a TSR component which stratifies the performance of the Company's common stock price compared to a defined peer group of companies over the three-year period subsequent to February 15, ~~2021,~~2023, such that if the Company's TSR falls at the 75th percentile or higher compared to the peer group, grantees will receive an additional 25% of ~~performance~~total company-performance adjusted shares. If the Company's TSR falls at the 25th percentile or lower compared to the peer group, grantees will forfeit 25% of ~~performance~~total company-performance adjusted shares. If the Company's TSR falls within the 75th and 25th percentiles, there will be no additional adjustment and grantees will receive their performance shares as per the EBITDA metric previously discussed. The final award is also affected by forfeitures upon the termination of a grantee’s employment with the Company. The remaining ~~144,605~~262,057 shares from the ~~2021~~2023 LTIP are not subject to adjustment based on any performance or other criteria, but rather, vest in three equal installments on each of the first, second and third anniversaries of the grant date, assuming the grantee is employed by the Company on those vesting dates. The grant date fair value of the ~~2021~~2023 LTIP was $~~23.00~~22.64 per share for those shares not subject to adjustment based on any performance or other criteria except the passage of time, and the 37.5% of shares subject only to the EBITDA criteria of Company ~~performance, which represents the closing price of the Company's common stock on the New York Stock Exchange on February 12, 2021, the trading day before the grant date per our policy.~~performance. For the 62.5% of performance shares subject to both the EBITDA criteria of Company performance and the TSR component, the grant date fair value was $~~26.10~~26.08 per share as determined by a third-party valuation specialist engaged by the Company, which used Monte Carlo simulation techniques to determine the fair value of such shares, which we consider to be a Level 3 input.

~~On May 20, 2021, we issued a total of~~ ~~28,140~~ ~~shares of restricted stock awards to~~ 7 ~~non-employee board members of the Company, and~~ ~~8,040~~ ~~restricted stock units to~~ 2 non-employee board members of the Company who elected to defer receipt of their stock awards, as the non-cash portion of their annual compensation for participation on the Company’s Board of Directors. The restrictions on these awards lapse ~~one year~~ ~~after the grant date. The awards have a weighted average fair value on date of grant of $24.88~~ ~~based on the New York Stock Exchange market price of the common stock on the close of business on the day the awards were granted.~~

~~On February 1, 2020, in connection with the NewSouth Acquisition, we issued~~ ~~129,032~~ ~~shares of restricted stock awards to the sellers of NewSouth, who became employees of the Company after the acquisition, representing~~ ~~64,516~~ shares each of those two sellers. This restricted stock award cliff-vests on the third anniversary of the February 1, 2020 acquisition date of NewSouth and requires that the grantees be employees of the Company on the vesting date. This stock had a fair value on the date of grant of $~~15.50~~ ~~per share, and the related stock-based compensation expense is being recognized on a straight-line basis over the~~ ~~three-year~~ life of the grant. The two sellers also have the ability to earn shares of Company common stock for the opening of new stores in new markets in which NewSouth has not previously had a presence. These two sellers were granted a total of ~~351,612~~ ~~shares of restricted stock to open~~ 11 ~~new stores over approximately three years from February 1, 2020 to December 31, 2022, which represents~~ ~~32,258~~ ~~shares per store for each of the first~~ 10 ~~stores, and~~ ~~29,032~~ ~~shares for the~~ ~~eleven~~th store, with the primary goal of expanding our direct-to-consumer sales-model footprint in the southeastern United States. For stores opened in 2020, once the store achieves a trailing six-month ("TSM") EBITDA of $~~250,000~~ ~~with TSM EBITDA margin of~~ 8~~%, the two sellers will vest in the shares for that store. For stores opened in 2021, once the store achieves a TSM EBITDA of $125,000~~ ~~with a TSM EBITDA margin of~~ 6%, the two sellers will vest in the shares for that store. For stores opened in 2022, shares vest upon the opening of the store. In 2021, two stores that were opened in 2020 achieved the required TSM EBITDA and TSM EBITDA margin, which resulted in the sellers vesting in the shares relating to those stores. We recognize stock-based compensation expense on each store, based on our assessment of the probability of a store opening and achieving the metrics assigned to such store.

We record stock compensation expense over an equity award’s vesting period using the award’s fair value at the date of grant. We recorded compensation expense for stock-based awards of $~~7.8~~12.2 million, $~~5.5~~9.7 million and $~~3.9~~7.8 million for the years ended December 30, 2023, December 31, 2022, and January 1, 2022, ~~January 2, 2021, and December 28, 2019,~~ respectively.

- 75 -

Of the $~~7.8~~12.2 million, $~~5.5~~9.7 million and $~~3.9~~7.8 million in stock-based compensation expense in the years ended December 30, 2023, December 31, 2022, and January 1, 2022, ~~January 2, 2021, and December 28, 2019,~~ respectively, $~~6.4~~10.5 million, $~~4.8~~8.2 million and $~~3.2~~6.4 million, respectively, are classified within selling, general and administrative expense in the accompanying consolidated statements of operations for those years, with the remainder classified within cost of sales.

~~- 85~~ -

~~Stock Options~~

~~A summary of the status of our stock options as of January 1, 2022, and changes during the year then ended, is presented below:~~

Number of
Shares

Weighted
Average
Exercise Price

Weighted
Average
Life in Years

Outstanding at January 2, 2021

67,797

$
2.04

Exercised

(67,797
)

$
2.04

Outstanding at January 1, 2022

0

—

—

Exercisable at January 1, 2022

0

—

—

~~For the years ended January 1, 2022 and January 2, 2021, we received $138~~ ~~thousand and $0.6~~ ~~million in proceeds, from the exercise of~~ ~~67,797~~ ~~and~~ ~~284,353~~ ~~options for which we recognized $0.9~~ ~~million and $0.8~~ million in excess tax benefits as discrete items of income tax expense in each of those year, respectively. The aggregate intrinsic value of stock options exercised during the years ended January 1, 2022 and January 2, 2021, was $~~1.6~~ ~~million and $3.4~~ ~~million, respectively.~~

Restricted Share Awards

A summary of the status of restricted share awards as of ~~January 1, 2022,~~December 30, 2023, and changes during the year then ended, are presented below:


	Number of Shares			Weighted Average Fair Value		Number of Shares	Weighted Average Fair Value
Outstanding at January 2, 2021		864,918		$	16.48
Outstanding at December 31, 2022						1,268,258	$18.75
Granted		709,122		$	19.37	1,064,169	$23.94
Vested		(312,982	)	$	16.03	(767,734)	$18.86
Forfeited/Performance adjustment		(114,952	)	$	17.71	(418,164)	$19.18

Outstanding at January 1, 2022		1,146,106		$	18.25
Outstanding at December 30, 2023						1,146,529	$24.60

As of ~~January 1, 2022,~~December 30, 2023, the remaining compensation cost related to non-vested share awards was $~~5.9~~18.9 million which is expected to be recognized in earnings using an accelerated method resulting in higher levels of compensation costs occurring in earlier periods over a weighted average period of ~~1.6~~2.1 years.

~~19.~~18. Accumulated Other Comprehensive Income (Loss)

The following table shows the components of accumulated other comprehensive income (loss) for the years ended December 30, 2023, December 31, 2022, and January 1, ~~2022, January 2, 2021, and December 28, 2019:~~2022:


	Aluminum									Aluminum
	Forward			MTP						Forward			MTP
(in thousands)	Contracts			Contracts			Total			Contracts			Contracts			Total
Accumulated other comprehensive loss at December 29, 2018	$	(3,065	)	$	-		$	(3,065	)
Change in fair value of derivatives		(1,229	)		-			(1,229	)
Amounts reclassified from accumulated other comprehensive earnings		5,030			-			5,030
Tax effect		(974	)		-			(974	)
Net current-period other comprehensive income		2,827			-			2,827
Accumulated other comprehensive loss at December 28, 2019	$	(238	)	$	-		$	(238	)

Accumulated other comprehensive loss at December 28, 2019	$	(238	)	$	-		$	(238	)
Change in fair value of derivatives		1,037			532			1,569
Amounts reclassified from accumulated other comprehensive earnings		2,470			(111	)		2,359
Tax effect		(866	)		(104	)		(970	)
Net current-period other comprehensive income		2,641			317			2,958
Accumulated other comprehensive income at January 2, 2021	$	2,403		$	317		$	2,720

Accumulated other comprehensive income at January 2, 2021	$	2,403		$	317		$	2,720		$	2,403		$	317		$	2,720
Change in fair value of derivatives		14,012			10,443			24,455			14,012			10,443			24,455
Amounts reclassified from accumulated other comprehensive earnings		(12,373	)		(6,265	)		(18,638	)		(12,373	)		(6,265	)		(18,638	)
Tax effect		(432	)		(1,099	)		(1,531	)		(432	)		(1,099	)		(1,531	)
Net current-period other comprehensive income		1,207			3,079			4,286			1,207			3,079			4,286
Accumulated other comprehensive income at January 1, 2022	$	3,610		$	3,396		$	7,006		$	3,610		$	3,396		$	7,006

Accumulated other comprehensive income at January 1, 2022										$	3,610		$	3,396		$	7,006
Change in fair value of derivatives											(7,732	)		42			(7,690	)
Amounts reclassified from accumulated other comprehensive earnings											2,903			(4,341	)		(1,438	)
Tax effect											1,219			1,126			2,345
Net current-period other comprehensive loss											(3,610	)		(3,173	)		(6,783	)
Accumulated other comprehensive income at December 31, 2022										$	-		$	223		$	223

Accumulated other comprehensive income at December 31, 2022										$	-		$	223		$	223
Change in fair value of derivatives											(361	)		(94	)		(455	)
Amounts reclassified from accumulated other comprehensive earnings											618			(206	)		412
Tax effect											(66	)		77			11
Net current-period other comprehensive loss											191			(223	)		(32	)
Accumulated other comprehensive income at December 30, 2023										$	191		$	-		$	191

19. Segments

We have 2two reportable segments: the Southeast segment, and the Western segment.

The Southeast reporting segment, which is also an operating segment, is composed of sales from our manufacturing facilities in Florida. The Western reporting segment, also an operating segment, is composed of sales from our manufacturing facilities in Arizona, California and ~~California.~~Utah.

Centralized financial and operational oversight, including resource allocation and assessment of performance on an income (loss) from operations basis, is performed by our CEO, whom we have determined to be our chief operating decision maker (“CODM”), with oversight by the Board of Directors. ~~Total asset information by segment is not included herein as asset information by segment is not presented to or reviewed by the CODM.~~

The following table represents summary financial data attributable to our operating segments for the years ended December 30, 2023, December 31, 2022, and January 1, ~~2022, January 2, 2021, and December 28, 2019.~~2022. Results of the Southeast segment for the year ended January 1, 2022 includes the results of Eco for its post-acquisition period from February 1, ~~2021, and~~2021. Results of the Western segment for the year ended ~~January 2, 20201~~December 31, 2022 includes the results of ~~NewSouth~~Martin for its post-acquisition period from ~~February 1, 2020. Results of the Western segment~~October 14, 2022, and for the year ended January 1, 2022, includes the results of ~~CRi for its post-acquisition period from May 1, 2021, and~~ Anlin for its post-acquisition period from October 25, 2021. Corporate overhead has been allocated to each segment using an allocation method we believe is reasonable (in thousands):


	Year Ended
	December 30,			December 31,			January 1,
	2023			2022			2022
Net sales:
Southeast segment	$	1,130,394		$	1,110,355		$	968,693
Western segment		373,847			381,599			192,771

Total net sales	$	1,504,241		$	1,491,954		$	1,161,464

Income from operations:
Southeast segment	$	137,150		$	112,593		$	74,815
Western segment		49,298			55,190			25,641
Impairment of trade name (1)		(5,500	)		(7,423	)		—
Restructuring costs and charges, net (2)		(1,722	)		—			—

Total income from operations		179,226			160,360			100,456

Interest expense, net		31,077			28,879			30,029
Debt extinguishment costs		-			410			25,472

Total income before income taxes	$	148,149		$	131,071		$	44,955

~~- 87~~

(1)

In 2023, impairment to our Martin trade name, which is part of our Western segment. In 2022, impairment relates to our WinDoor trade name, which is part of our Southeast segment.

(2)

Year Ended

January 1,

January 2,

December 28,

2022

2021

2019

Net sales:

Southeast segment

$
968,693

$
752,432

$
606,631

Western segment

192,771

130,189

138,325

Total net sales

$
1,161,464

$
882,621

$
744,956

Income from operations:

Southeast segment

$
74,815

$
85,794

$
75,484

Western segment

25,641

11,144

8,572

Impairment of trade name

—

(8,000
)

—

Restructuring costs and charges

—

(4,227
)

—

Total income from operations

100,456

84,711

84,056

Interest expense, net

30,029

27,719

26,417

Debt extinguishment costs

25,472

-

1,512

Total income before income taxes

$
44,955

$
56,992

$
56,127

Restructuring costs and charges, net, relates to our NewSouth brand, which is part of our Southeast segment.

Depreciation expense for the years ended December 30, 2023, December 31, 2022, and January 1, 2022, ~~January 2, 2021 and December 28, 2019,~~ was $~~26.5~~27.9 million, $~~20.9~~27.4 million, and $~~15.8~~26.5 million for our Southeast segment, respectively, and $~~4.0~~8.1 million, $~~3.1~~6.7 million, and $~~3.1~~4.0 million for our Western segment, respectively. Amortization expense for the years ended December 30, 2023, December 31, 2022, and January 1, 2022, ~~January 2, 2021 and December 28, 2019,~~ was $~~10.7~~7.9 million, $~~9.2~~10.1 million, and $~~6.4~~10.7 million for our Southeast segment, respectively, and $~~10.4~~18.4 million, $~~9.6~~16.0 million, and $~~9.4~~10.4 million for our Western segment, respectively.

Total assets of our Southeast segment as of December 30, 2023 and December 31, 2022 were $899.7 million and $909.6 million, respectively. Total assets of our Western segment as of December 30, 2023 and December 31, 2022 were $678.2 million and $730.6 million, respectively.

Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Our management, under the supervision and with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(c) of the Securities and Exchange Act of 1934, as amended, or the Exchange Act) as of ~~January 1, 2022.~~December 30, 2023. Our disclosure controls and procedures are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported, within the time periods specified in the rules and forms of the SEC. These disclosure controls and procedures include, among other things, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, management is required to apply its judgment in evaluating the benefits of possible disclosure controls and procedures relative to their costs to implement and maintain.

Based on management’s evaluation, our principal executive officer and principal financial officer concluded that, as of ~~January 1, 2022,~~December 30, 2023, our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) refers to the process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer, and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Management is responsible for establishing and maintaining adequate internal control over our financial reporting.

We have evaluated the effectiveness of our internal control over financial reporting as of ~~January 1, 2022.~~December 30, 2023. The evaluation was performed based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on such evaluation, management concluded that, as of such date, our internal control over financial reporting is effective.

The effectiveness of the Company’s internal control over financial reporting as of ~~January 1, 2022,~~December 30, 2023, has been audited by Ernst & Young LLP, an independent registered public accounting firm, which also audited the Company’s Consolidated Financial Statements for the year ended ~~January 1, 2022.~~December 30, 2023. Ernst & Young LLP’s report on internal control over financial reporting is set forth below.

There have been no changes in our internal control over financial reporting for the quarter ended ~~January 1, 2022,~~December 30, 2023, identified in connection with the evaluation described above that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. However, during the year ended January 1, 2022, we acquired Eco and Anlin. We are currently integrating Eco and Anlin into our operations, compliance programs and internal control processes. As such Eco and Anlin have not been included in our assessment of internal control over financial reporting as of January 1, 2022. We will include Eco and Anlin into our assessment of internal controls as of December 31, 2022, the end of our 2022 fiscal year. Eco Enterprises and Anlin Industries are included in the 2021 consolidated financial statements of the Company and constitute 22.0% of total assets as of January 1, 2022 and 9.2% of revenues for the fiscal year then ended.

We have audited PGT Innovations, Inc.’sinternal control over financial reporting as of ~~January 1, 2022,~~December 30, 2023, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, PGT Innovations, Inc. (the Company) maintained, in all material respects, effective internal control over financial reporting as of ~~January 1, 2022,~~December 30, 2023, based on the COSO criteria.

~~As indicated in the accompanying~~Management’s Report on our Internal Control over Financial Reporting, management’s assessment of and conclusion on the effectiveness of internal control over financial reporting did not include the internal controls of Eco Enterprises and Anlin Industries, which are included in the 2021 consolidated financial statements of the Company and constitute 22.0% of total assets as of January 1, 2022 and 9.2% of revenues for the fiscal year then ended. Our audit of internal control over financial reporting of the Company also did not include an evaluation of the internal control over financial reporting of Eco Enterprises and Anlin Industries.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance ~~sheet~~sheets of the Company as of ~~January 1,~~December 30, 2023 and December 31, 2022, the related consolidated statements of operations, comprehensive income, ~~shareholders'~~shareholders’ equity and cash flows for each of the three fiscal years in the period ended ~~January 1, 2022,~~December 30, 2023, and the related notes and the financial statement schedule listed in the Index at Item 15(a) and our report dated ~~March 1, 2022~~February 23, 2024 expressed an unqualified opinion thereon.

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on our Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

During the fiscal quarter ended December 30, 2023, none of our directors or other officers adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as those terms are defined in Item 408 of Regulation S-K.

The information required by this item with respect to our executive officers will be set forth in Proxy Statement for our ~~2022~~2024 Annual Meeting of Stockholders (our ~~“2022~~“2024 Proxy Statement”), under the caption "Governance of the Company" and is incorporated herein by reference.

The information required by this item with respect to our board of directors and committees thereof will be set forth in our ~~2022~~2024 Proxy Statement under the caption "Governance of the Company" and is incorporated herein by reference.

The information required by this item with respect to Section 16(a) beneficial ownership reporting compliance will be set forth in our ~~2022~~2024 Proxy Statement under the caption "Compliance with Section 16(a) of the Securities Exchange Act of 1934" and is incorporated herein by reference.

The information required by this item will be set forth in our ~~2022~~2024 Proxy Statement under the captions “Executive Compensation,” “Employment Agreements”, and “Change in Control Agreements,” “Information Regarding the Board and its Committees — Information on the Compensation of Directors,” “Compensation Committee Report,” and “Compensation Committee Interlocks and Insider Participation,” which information is incorporated herein by reference.

Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The information required by this item will be set forth in our ~~2022~~2024 Proxy Statement under the caption “Security Ownership of Certain Beneficial Owners and Management” and “Equity Compensation Plan Information,” which information is incorporated herein by reference.

Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information required by this item will be set forth in our ~~2022~~2024 Proxy Statement under the caption “Certain Relationships and Related Transactions,” which information is incorporated herein by reference.

The information required by this item will be set forth in our ~~2022~~2024 Proxy Statement under the caption “Audit Committee Report — Fees Paid to the Principal Accountant,” which information is incorporated herein by reference.

(a)(1) See the index to consolidated financial statements and schedule provided in Item 8 for a list of the financial statements filed as part of this report.

(3) The following documents are filed, furnished or incorporated by reference as exhibits to this report as required by Item 601 of Regulation S-K

* Certain exhibits and schedules have been omitted, and the Company agrees to furnish supplementally to the Commission a copy of any omitted exhibits or schedules upon request. Portions of this exhibit have been omitted pursuant to Item 601(b)(2) of Regulation S-K because they (i) are not material and (ii) would likely cause competitive harm to the Company if publicly disclosed. The Company agrees to furnish supplementally to the Commission an unredacted copy of this exhibit upon request.

Pursuant to the requirements of Section 13 or 15(d) of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

The undersigned hereby constitute and appoint Ryan Quinn and his substitutes our true and lawful attorneys-in-fact with full power to execute in our name and behalf in the capacities indicated below any and all amendments to this report and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, and hereby ratify and confirm all that such attorney-in-fact or his substitutes shall lawfully do or cause to be done by virtue thereof. Pursuant to the requirements of the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.


Delaware		20-0634715
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

1070 Technology Drive North Venice, Florida		34275
(Address of principal executive offices)		(Zip Code)


			Page
	PART I

Item 1.	Business	65
Item 1A.	Risk Factors	1412
Item 1B.	Unresolved Staff Comments	2523
Item 1C.	Cybersecurity	23
Item 2.	Properties	26
Item 3.	Legal Proceedings	2627
Item 4.	Mine Safety Disclosures	27

	PART II

Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	28
Item 6.	[Reserved]	30
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3031
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	4441
Item 8.	Financial Statements and Supplementary Data	4542
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	9080
Item 9A.	Controls and Procedures	9080
Item 9B.	Other Information	9282
Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	9282


	PART III

Item 10.	Directors, Executive Officers and Corporate Governance	9383
Item 11.	Executive Compensation	9383
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	9383
Item 13.	Certain Relationships and Related Transactions, and Director Independence	9383
Item 14.	Principal Accountant Fees and Services	9383


	PART IV

Item 15.	Exhibit and Financial Statement Schedules	9484
Item 16.	Form 10-K Summary	9787
	Signatures	9888



		Purchases of Equity Securities
Period	Beginning and Ending Dates	(a) Total Number of Shares Purchased	(b) Average Price Paid per Share (in $)	(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	(d) Maximum Approximate Dollar Value of Shares that may yet be Purchased Under the Plans or Programs at End of Period (in $M)
Beginning balance	September 30				$174.87
October 2023	October 1 to October 28	194,735	$27.0490	194,735	$169.60
November 2023	October 29 to November 25	65,218	$29.9088	65,218	$167.65
December 2023	November 26 to December 30	—	$0.0000	—	$167.65

		259,953	$27.7665	259,953


Report of Independent Registered Public Accounting Firm – Ernst & Young LLP (Public Company Accounting Oversight Board ID: 42)		4643

~~Report of Independent Registered Public Accounting Firm – KPMG LLP (Public Company Accounting Oversight Board ID:~~ ~~185~~)		48

Consolidated Statements of Operations for the years ended December 30, 2023, December 31, 2022, and January 1, 2022 ~~January 2, 2021, and December 28, 2019~~		4945

Consolidated Statements of Comprehensive Income for the years ended December 30, 2023, December 31, 2022, and January 1, 2022 ~~January 2, 2021, and December 28, 2019~~		5046

Consolidated Balance Sheets as of ~~January 1,~~December 30, 2023, and December 31, 2022 ~~and January 2, 2021~~		5147

Consolidated Statements of Cash Flows for the years ended December 30, 2023, December 31, 2022, and January 1, 2022 ~~January 2, 2021, and December 28, 2019~~		5248

Consolidated Statements of Shareholders’ Equity for the years ended December 30, 2023, December 31, 2022, and January 1, 2022 ~~January 2, 2021, and December 28, 2019~~		5349

Notes to Consolidated Financial Statements		5450


		Martin Brand Indefinite-Lived Intangible Asset Impairment Evaluation
		~~Valuation of Intangible Assets Acquired in the Eco Enterprises and Anlin Industries Business Combinations~~
Description of the Matter		~~During fiscal 2021,~~At December 30, 2023, the ~~Company completed its acquisition~~Company’s total indefinite-lived intangible assets, excluding goodwill, were $219.5 million of a 75% ownership stake in Eco Enterprises LLC and its related companies, Eco Windows Systems, LLC, Eco Glass Production, LLC, and Unity Windows, LLC (together “Eco”) for fair value consideration of $100.5that, $18.5 million ~~and its acquisition of Anlin Industries (“Anlin”) for fair value consideration of $120.1 million, as disclosed~~relates to the Martin Door trade name. As discussed in Note ~~5 to~~2 and Note 7 of the consolidated financial ~~statements.~~statements, indefinite-lived intangible assets are tested for impairment at least annually on the first day of the fiscal fourth quarter, and at interim periods if needed based on occurrence of triggering events. If the fair value of any indefinite-lived intangible asset is less than its carrying amount, an impairment loss is recognized in an amount equal to the difference. The ~~transactions were accounted for as business combinations and~~Company recognized an impairment charge of $5.5 million related to the ~~assets acquired and liabilities assumed have been recorded at fair value.~~Martin Door brand trade name during the year ended December 30, 2023.


☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

		Emerging growth company	☐


		Auditing the Company's ~~accounting for its acquisitions~~indefinite-lived intangible asset impairment assessment of ~~Eco and Anlin~~the Martin Door brand trade name was complex ~~and judgmental~~ due to the ~~significant~~ estimation ~~required by management to determine~~uncertainty in determining the fair value of the ~~acquisitions’ identified~~ intangible ~~assets~~asset. The Company used the income approach of ~~$152.1 million, which consisted primarily~~the relief-from-royalty method to measure the fair value of the trade ~~names and customer relationships of $70.3 million and $81.5 million, respectively. The Company used income approaches:~~name intangible asset. In particular, the ~~relief-from-royalty method and Multiperiod Excess Earnings Method (MPEEM) to measure the trade name and customer relationship intangible assets, respectively. The significant estimation~~Company's fair value estimate was ~~primarily due~~sensitive to the ~~judgment involved and the sensitivity~~underlying assumption of ~~the respective fair values to certain underlying assumptions used to calculate the fair values, specifically~~ the forecasted revenue growth rates used in ~~each~~the model. This significant assumption is forward looking and could be affected by future ~~operating,~~ economic, industry and ~~market conditions.~~company-specific factors.


Accrued Warranty		Beginning of Period		Acquired		Charged to Expense		Adjustments			Settlements			End of Period
	(in thousands)
Year ended January 1, 2022		$	8,001	$	4,150	$	23,637	$	(1,440	)	$	(20,844	)	$	13,504

Year ended January 2, 2021		$	6,244	$	3,515	$	15,256	$	266		$	(17,280	)	$	8,001

Year ended December 28, 2019		$	6,149	$	-	$	12,720	$	570		$	(13,195	)	$	6,244


Accrued Warranty		Beginning of Period		Acquired (Acquisition Adjustment)			Charged to Expense		Adjustments			Settlements			End of Period
	(in thousands)
Year ended December 30, 2023		$	15,388	$	-		$	36,261	$	(285	)	$	(36,128	)	$	15,236

Year ended December 31, 2022		$	13,504	$	(2,537	)	$	31,223	$	698		$	(27,500	)	$	15,388

Year ended January 1, 2022		$	8,001	$	4,150		$	23,637	$	(1,440	)	$	(20,844	)	$	13,504


Building and improvements	5 to 40 years
Leasehold improvements	Shorter of lease term or estimated useful life
Furniture and equipment	3 to 10 years
Vehicles	5 to 10 years
Computer software	3 years



	Preliminary Allocation
Accounts receivable	$	10,803
Inventories		7,633
Contract assets, net		7,027
Prepaid expenses and other assets		1,626
Property and equipment		22,800
Operating lease right-of-use asset		3,450
Intangible assets		77,800
Goodwill		5,596
Total assets acquired		136,735
Accounts payable		(5,175	)
Accrued and other liabilities		(7,993	)
Operating lease liability		(3,450	)
Total liabilities assumed		(16,618	)
Fair value of consideration transferred	$	120,117

Consideration:
Cash	$	114,196
Contingent consideration		5,921
Fair value of consideration transferred	$	120,117


			Initial
	Preliminary		Useful Life
	Valuation		(in years)
(in thousands)
Trade name	$	35,400	indefinite
Customer relationships		42,100	15
Developed technology		300	9

Intangible assets, net	$	77,800


	Years Ended
	January 1,		January 2,
Pro Forma Results (unaudited)	2022		2021
(in thousands, except per share amounts)	(unaudited)
Net sales	$	1,251,314	$	967,825

Net income attributable to common shareholders	$	35,273	$	50,838

Net income per common share attributable to common shareholders:
Basic	$	0.59	$	0.86
Diluted	$	0.59	$	0.86


								Initial
	Initial		Adjustment to			Final		Useful Life
	Valuation		Valuation			Valuation		(in years)
(in thousands)
Trade name	$	23,500	$	(1,300	)	$	22,200	15
Non-compete agreements		1,670		—			1,670	5
Developed technology		2,600		—			2,600	6
Customer-related intangible		900		—			900	<1

Other intangible assets, net	$	28,670	$	(1,300	)	$	27,370


	Number of Shares			Weighted Average Exercise Price		Weighted Average Life in Years
Outstanding at January 2, 2021		67,797		$	2.04
Exercised		(67,797	)	$	2.04

Outstanding at January 1, 2022		0			—		—

Exercisable at January 1, 2022		0			—		—


	Year Ended January 1, 2022
	First Quarter		Second Quarter		Third Quarter (1)			Fourth Quarter
Net sales	$	271,092	$	285,500	$	300,431		$	304,441
Gross profit		93,962		97,009		104,203			108,325
Net income (loss) attributable to common shareholders		12,384		6,582		(6,782	)		14,613
Net income (loss) per share – basic	$	0.21	$	0.11	$	(0.11	)	$	0.24
Net income (loss) per share – diluted	$	0.21	$	0.11	$	(0.11	)	$	0.24


	Year Ended January 2, 2021
	First Quarter		Second Quarter (2)		Third Quarter		Fourth Quarter
Net sales	$	220,204	$	202,783	$	238,033	$	221,601
Gross profit		81,127		74,463		86,936		78,798
Net income		15,600		2,199		17,322		9,987
Net income per share – basic	$	0.27	$	0.04	$	0.29	$	0.17
Net income per share – diluted	$	0.26	$	0.04	$	0.29	$	0.17


	Year Ended January 2, 2021
Restructuring costs and charges	Beginning of Period		Charged to Expense		Write-offs of Assets			Settled in Cash			End of Period
(in thousands)
Property and equipment costs and charges	$	—	$	1,284	$	(540	)	$	(744	)	$	—
Impairment of lease right-of-use asset		—		639		(639	)		—			—
Inventory charges		—		1,164		(1,263	)		99			—
Personnel-related costs		—		1,140		—			(1,140	)		—

Total restructuring costs and charges	$	—	$	4,227	$	(2,442	)	$	(1,785	)	$	—


	Balance at							Balance at		Balance at							Balance at
	Beginning		Costs and					End of		Beginning		Costs and					End of
Allowance for Doubtful Accounts	of Period		expenses		Deductions*			Period		of Period		expenses		Deductions*			Period
	(in thousands)									(in thousands)
Year ended December 30, 2023										$	13,656	$	3,132	$	(2,610	)	$	14,178

Year ended December 31, 2022										$	4,702	$	10,979	$	(2,025	)	$	13,656

Year ended January 1, 2022	$	3,716	$	3,834	$	(2,848	)	$	4,702	$	3,716	$	3,834	$	(2,848	)	$	4,702

Year ended January 2, 2021	$	3,320	$	996	$	(600	)	$	3,716

Year ended December 28, 2019	$	2,789	$	1,553	$	(1,022	)	$	3,320



Exhibit Number		Description

~~2.1~~		Purchase Agreement, dated as of July 24, 2018 by and among the Company, Coyote Acquisition Co., GEF WW Parent LLC, WWS Blocker LLC and the Sellers and Additional Sellers named in the Purchase Agreement and the Seller Representative*(incorporated herein by reference to Exhibit 2.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on July 24, 2018)

2.2		Membership Interest Purchase Agreement, dated as of December 10, 2019, among the Company, NewSouth Window Solutions, LLC, NewSouth Window Solutions of Orlando, LLC, NSWS Holdings, Inc., NSWS Orlando Holdings, Inc., the current members of NewSouth Window Solutions, LLC and NSWS Rep, LLC, as representative of the Sellers (incorporated herein by reference to Exhibit 2.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on December 10, 2019)

2.3		Purchase Agreement, dated as of January 7, 2021, among the Company, Eco Window Systems, LLC, Eco Glass Production Inc., Unity Windows Inc., Frank Mata, an individual, Luis Arrieta, an individual, New Eco Windows Holding, LLC, a newly formed Delaware limited liability company, and three newly formed entities (incorporated herein by reference to Exhibit 2.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on January 11, 2021)

2.4		Asset Purchase Agreement, dated as of September 1, 2021, by and among Anlin Industries, Western Window Holding LLC and the Company (incorporated herein by reference to Exhibit 2.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on September 3, 2021)*

2.5		Share Purchase Agreement dated as of October 14, 2022 among WWS Acquisition, LLC, Martin Door Holdings, Inc., Martin Door Sellers’ Representative, LLC and the shareholders and warrant holders parties thereto (incorporated herein by reference to Exhibit 2.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on October 19, 2022)

2.6		Agreement and Plan of Merger, dated as of January 16, 2024, by and among the Company, MIWD Holding Company LLC and RMR MergeCo, Inc. (incorporated herein by reference to Exhibit 2.1 to Current Report on Form 8-K dated January 17, 2024, filed with the Securities and Exchange Commission on January 17, 2024)

3.1		Amended and Restated Certificate of Incorporation of PGT, Inc. (incorporated herein by reference to Exhibit 3.1 to the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 18, 2010)

3.2		Second Amended and Restated By-Laws of PGT Innovations, Inc. ~~(incorporated~~(incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K dated February ~~27, 2017,~~17, 2023, filed with the Securities and Exchange Commission on ~~March 2, 2017)~~February 24, 2023)

3.3		Certificate of Amendment to the Amended and Restated Certificate of Incorporation of PGT, Inc. (incorporated herein by reference to Exhibit 3.1 to Current Report on Form 8-K dated December 14, 2016, filed with the Securities and Exchange Commission on December 19, 2016)


3.4		Rights Agreement, dated as of March 30, 2023, between the Company and American Stock Transfer & Trust Company, LLC, as Rights Agent (incorporated herein by reference to Exhibit 4.1 to Current Report on Form 8-K dated March 30, 2023, filed with the Securities and Exchange Commission on March 30, 2023)


4.1		Form of Specimen Certificate (incorporated herein by reference to Exhibit 4.1 to Amendment No. 2 to the Registration Statement of the Company on Form S-1, filed with the Securities and Exchange Commission on December 24, 2009, Registration No. 333-132365)


4.2		Indenture, dated as of August 10, 2018, between PGT Escrow Issuer, Inc. and U.S. Bank National Association, as Trustee, governing the 6.75% Senior Notes due 2026 (incorporated herein by reference to Exhibit 4.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on August 13, 2018)

4.3		~~Form of 6.75% Senior Note due 2026 (incorporated herein by reference to Exhibit 4.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on August 13, 2018)~~

~~4.4~~		First Supplemental Indenture, dated as of August 13, 2018, by and between U.S. Bank National Association and the Guarantors party thereto (incorporated herein by reference to Exhibit 4.3 to Current Report on Form 8-K filed with the Securities and Exchange Commission on August 13, 2018)

~~4.5~~4.4		Second Supplemental Indenture, dated as of January 24, 2020, by and between the Company, U.S. Bank National Association, as Trustee, and the Guarantors party thereto (incorporated by reference to Exhibit 4.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on January 24, 2020)

~~4.6~~4.5		Third Supplemental Indenture, dated as of February 1, 2020, by and between the Company, U.S. Bank National Association, as Trustee, and the Guarantors party thereto (incorporated by reference to Exhibit 4.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on February 3, 2020)

~~4.7~~4.6		Fourth Supplemental Indenture, dated as of January 26, 2021, by and between the Company, U.S. Bank National Association, as Trustee, and the Guarantors party thereto (incorporated by reference to Exhibit 4.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on January 26, 2021)

~~4.8~~4.7		Indenture, dated as of September 24, 2021, by and among the Company, the Guarantors party thereto and U.S. Bank National Association, as Trustee, governing the 4.375% Senior Notes due 2029 (incorporated herein by reference to Exhibit 4.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on September 28, 2021)

~~4.9~~4.8		Form of 4.375% Senior Note due 2029 (incorporated herein by reference to Exhibit 4.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on September 28, 2021)

4.9		Rights Agreement, dated as of March 30, 2023, between the Company and American Stock Transfer & Trust Company, LLC, as Rights Agent (incorporated herein by reference to Exhibit 4.1 to Current Report on Form 8-K dated March 30, 2023, filed with the Securities and Exchange Commission on March 30, 2023)

10.1		Credit Agreement dated February 16, 2016, among PGT Innovations, Inc., the lending institutions from time to time party thereto, and Deutsche Bank AG New York Branch, as Administrative Agent, Collateral Agent, Swing Line Lender and Letter of Credit Issuer. (incorporated herein by reference to Exhibit 10.1 to Current Report on Form 8-K dated February 16, 2016, filed with the Securities and Exchange Commission on February 17, 2016)

~~10.4~~10.2		Product Supply and Sales Agreement dated February 7, 2020, by and between PGT Innovations, Inc. and Kuraray America, Inc. (incorporated herein by reference to Exhibit 10.1 to Current Report on Form 8-K dated February 7, 2020, filed with the Securities and Exchange Commission on February 14, 2020)

~~10.6~~10.3		PGT Innovations, Inc. Amended and Restated 2006 Equity Incentive Plan (incorporated herein by reference to Exhibit 10.7 to the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 18, 2010)

~~10.7~~		Form of PGT Innovations, Inc. 2006 Equity Incentive Plan Non-Qualified Stock Option Agreement (incorporated herein by reference to Exhibit 10.8 to Amendment No. 3 to the Registration Statement of the Company on Form S-1/A, filed with the Securities and Exchange Commission on June 8, 2006)

~~10.8~~		Third Amendment to the Credit Agreement, dated as of October 31, 2019, by and among the Company, the other Credit Parties thereto, SunTrust Bank, as Initial Term A Lender, the Initial Revolving Credit Lenders, each LC Issuer, and SunTrust Bank, as Administrative Agent, Collateral Agent and Swing Line Lender (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on November 6, 2019)


~~10.9~~10.4†		Form of PGT Innovations, Inc. Director Indemnification Agreement (incorporated herein by reference to Exhibit 10.9 to Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 10, 2017)

~~10.10~~10.5†		Form of PGT Innovations, Inc. 2006 Equity Incentive Plan Replacement Non-Qualified Stock Option Agreement (incorporated herein by reference to Exhibit 10.17 to the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 18, 2010)

~~10.11~~		PGT Innovations, Inc. 2014 Omnibus Equity Incentive Plan (incorporated herein by reference to Appendix A to Definitive Proxy Statement on Form DEF 14A dated March 28, 2014, filed with the Securities and Exchange Commission on April 2, 2014)

~~10.14~~10.6		First Amendment to Credit Agreement, dated as of February 17, 2017, among PGT Innovations, Inc., the lending institutions from time-to-time party thereto, and Deutsche Bank AG New York Branch, as Administrative Agent, Collateral Agent, Swing Line Lender and Letter of Credit Issuer. (incorporated herein by reference to Exhibit 10.1 to Current Report on Form 8-K dated February 17, 2017, filed with the Securities and Exchange Commission on February 22, 2017)

~~10.15~~10.7		Independent Contractor Agreement effective as of January 1, 2019, by and between Rodney Hershberger, and PGT Innovations, Inc. (incorporated herein by reference to Exhibit 10.15 to Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 26, 2020)

~~10.18~~		Supply Agreement dated September 22, 2017, by and between PGT Industries, Inc. and Cardinal LG Company (incorporated herein by reference to Exhibit 10.1 to Current Report on Form 8-K dated September 22, 2017, filed with the Securities and Exchange Commission on September 22, 2017)

~~10.19~~10.8		~~PGT Savings Plan (incorporated herein by reference to Exhibit 4.5 to the Company’s Form S-8 Registration Statement, filed with the Securities and Exchange Commission on October 15, 2007)~~

~~10.20~~		Second Amendment to Credit Agreement, dated March 16, 2018 by and among PGT Innovations, Inc., a Delaware corporation, the other Credit Parties (as defined in the Credit Agreement) party hereto, the Lenders party hereto, SunTrust Bank, as Administrative Agent, Collateral Agent, Swing Line Lender and an LC Issuer and Deutsche Bank AG New York Branch, as resigning Administrative Agent, resigning Collateral Agent, resigning Swing Line Lender and a resigning LC Issuer (incorporated herein by reference to Exhibit 10.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on March 20, 2018)


~~10.21~~10.9		Supply Agreement, effective as of January 1, 2019, by and between PGT Industries, Inc. and Vitro Flat Glass LLC. (incorporated herein by reference to Exhibit 10.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on December 28, 2018)


~~10.22~~10.10†		PGT Innovations, Inc. 2019 Employee Stock Purchase Plan dated as of April 12, 2019 (incorporated herein by reference to Appendix B to DEF 14A filed with the Securities and Exchange Commission on February 26, 2020)

~~10.23~~10.11†		Amended and Restated PGT Innovations, Inc. 2019 Equity and Incentive Compensation Plan dated as of June 10, 2022 (incorporated by reference to Appendix A to DEF 14A filed with the Securities and Exchange Commission on April 29, 2022)

~~10.24~~10.12		Fourth Amendment to the Credit Agreement, dated as of October 25, 2021, by and among PGT Innovations, Inc., the other Credit Parties party thereto, Truist Bank (as successor by merger to SunTrust Bank), as Incremental Term A Lender, Administrative Agent and Collateral Agent (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on October 29, 2021)

~~10.25~~10.13†		Amended and Restated Employment Agreement between PGT Innovations, Inc. and ~~Robert Keller,~~Jeffrey T. Jackson, dated ~~January 1, 2021~~April 8, 2022 (incorporated herein by reference to Exhibit ~~10.25~~10.13 to Annual Report on Form 10-K, filed with the Securities and Exchange Commission on ~~March 1, 2022)~~February 27, 2023)

~~10.26~~10.14†		Employment Agreement between PGT Innovations, Inc. and ~~Brad West,~~Eric Kowalewski dated ~~January 1, 2021~~April 8, 2022 (incorporated herein by reference to Exhibit ~~10.26~~10.14 to Annual Report on Form 10-K, filed with the Securities and Exchange Commission on ~~March 1, 2022)~~February 27, 2023)

~~10.27~~10.15†		Employment Agreement between PGT Innovations, Inc. and ~~Michael Wothe,~~John Kunz, dated ~~January 1, 2021~~April 8, 2022 (incorporated herein by reference to Exhibit ~~10.28~~10.15 to Annual Report on Form 10-K, filed with the Securities and Exchange Commission on ~~March 1, 2022)~~February 27, 2023)

~~21.1~~10.16†		~~List of subsidiaries~~Amended and Restated Employment Agreement between PGT Innovations, Inc. and Robert Keller, dated April 8, 2022 (incorporated herein by reference to Exhibit ~~21.1~~10.16 to Annual Report on Form 10-K, filed with the Securities and Exchange Commission on ~~March 1,~~February 27, 2023)

10.17†		Amended and Restated Employment Agreement between PGT Innovations, Inc. and Michael Wothe, dated April 8, 2022 (incorporated herein by reference to Exhibit 10.17 to Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 27, 2023)

10.18†		Amended and Restated Employment Agreement between PGT Innovations, Inc. and Brad West, dated April 8, 2022 (incorporated herein by reference to Exhibit 10.18 to Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 27, 2023)

10.19†		Form of PGT Innovations, Inc. Restricted Share Award Agreement (Time Vesting) (incorporated herein by reference to Exhibit 10.19 to Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 27, 2023)

10.20†		Form of PGT Innovations, Inc. Restricted Share Award Agreement (Performance Vesting) (incorporated herein by reference to Exhibit 10.19 to Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 27, 2023)

10.21		Fifth Amendment to Credit Agreement, dated as of October 13, 2022, by and among PGT Innovations, Inc., the other Credit Parties party thereto, the financial institutions party thereto and Truist Bank, as Administrative Agent, Collateral Agent and Swing Line Lender (incorporated herein by reference to Exhibit 10.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on October 19, 2022)

10.22†		Employment Agreement between PGT Innovations, Inc. and Craig Henderson, dated August 2, 2023 (incorporated herein by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission on November 2, 2023)

21.1		List of subsidiaries**

23.1		Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm**



~~23.2~~		Consent of KPMG LLP, Independent Registered Public Accounting Firm**

24.1		Power of Attorney (included on the signature page of this Annual Report on Form ~~10-K/A)~~10-K)**

31.1		Certification of chief executive officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002**

31.2		Certification of chief financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002**

32.1		Certification of chief executive officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002**

32.2		Certification of chief financial officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002**



101.INS		Inline XBRL Instance Document – The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL ~~document.~~document

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101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase**

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101.LAB		Inline XBRL Taxonomy Extension Label Linkbase**

101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase**

104		Cover Page Interactive Data File (embedded within the Inline XBRL document)**



	PGT INNOVATIONS, INC.
	(Registrant)

Date: ~~June 10, 2022~~February 23, 2024	/s/ Jeffrey Jackson
	Jeffrey Jackson
	President and Chief Executive Officer

Date: ~~June 10, 2022~~February 23, 2024	/s/ ~~John Kunz~~Craig Henderson
	~~John Kunz~~
	Craig Henderson
	Senior Vice President and Chief Financial Officer


Signature	Title	Date

/s/ Rodney Hershberger	Chairman of the Board of Directors	~~June 10,~~February 23, ~~2022~~2024
Rodney Hershberger	Chairman of the Board of Directors	~~June 10,~~February 23, ~~2022~~2024

/s/ Jeffrey T. Jackson	President and Chief Executive Officer (Principal Executive Officer) and Director	~~June 10,~~February 23, ~~2022~~2024
Jeffrey T. Jackson		~~June 10,~~February 23, ~~2022~~2024

/s/ ~~John Kunz~~Craig Henderson	Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)	~~June 10,~~February 23, ~~2022~~2024
~~John Kunz~~Craig Henderson		~~June 10,~~February 23, ~~2022~~2024

/s/ Sheree L. Bargabos	Director	~~June 10,~~February 23, ~~2022~~2024
Sheree L. Bargabos	Director	~~June 10,~~February 23, ~~2022~~2024

/s/ Xavier Boza	Director	~~June 10,~~February 23, ~~2022~~2024
Xavier Boza	Director	~~June 10,~~February 23, ~~2022~~2024

/s/ Alexander R. Castaldi	Director	~~June 10,~~February 23, ~~2022~~2024
Alexander R. Castaldi	Director	~~June 10,~~February 23, ~~2022~~2024

/s/ Richard D. Feintuch	Director	~~June 10,~~February 23, ~~2021~~2024
Richard D. Feintuch	Director	~~June 10,~~February 23, ~~2021~~2024

/s/ Frances Powell Hawes	Director	~~June 10,~~February 23, ~~2022~~2024
Frances Powell Hawes	Director	~~June 10,~~February 23, ~~2022~~2024

/s/ Brett N. Milgrim	Director	~~June 10,~~February 23, ~~2022~~2024
Brett N. Milgrim	Director	~~June 10,~~February 23, ~~2022~~2024

/s/ William J. Morgan	Director	~~June 10,~~February 23, ~~2022~~2024
William J. Morgan	Director	~~June 10,~~February 23, ~~2022~~2024

/s/ Floyd F. Sherman	Director	~~June 10,~~February 23, ~~2022~~2024
Floyd F. Sherman	Director	~~June 10,~~February 23, ~~2022~~2024

/s/ Christopher J. Stephens, Jr.	Director	February 23,
Christopher J. Stephens, Jr.	Director	2024