PGTI Announces Closing of Offering of $60 Million of Additional 6.75% Senior Notes due 2026

Rhea-AI Summary

PGT Innovations, Inc. (NYSE: PGTI) has completed a private offering of $60 million additional 6.75% senior notes due 2026, issued at 105.500% of their principal amount. Proceeds will finance the acquisition of 75% of New Eco Windows Holding, LLC. If the acquisition does not close, funds will be used for debt repayment and corporate purposes. These notes are guaranteed by domestic restricted subsidiaries and were offered under Rule 144A of the Securities Act. Forward-looking statements highlight potential risks, including impacts from COVID-19 and integration challenges.

Positive

• Successful completion of $60 million private offering of senior notes.
• Funds allocated for strategic acquisition of New Eco Windows Holding, LLC.

Negative

• Risks associated with COVID-19 potentially affecting product demand and financial performance.
• Integration challenges with ECO and NewSouth Window Solutions could divert management focus.

PGT Innovations, Inc. (NYSE: PGTI), a national leader in premium windows and doors, including impact-resistant products and products designed to unify indoor/outdoor living spaces, announced today that it has completed its previously announced private offering of $60 million aggregate principal amount of additional 6.75% senior notes due 2026 (the “Additional Notes”). The Additional Notes were issued at 105.500% of their principal amount, plus accrued interest from August 1, 2020. The Additional Notes are part of the same issuance of, and rank equally and form a single series with, the $365.0 million aggregate principal amount of the Company’s 6.75% senior notes due 2026 (the “Existing Notes”), $315 million aggregate principal amount of which were issued on August 10, 2018 and $50 million aggregate principal amount of which were issued on January 24, 2020. The Additional Notes will have the same terms as the Existing Notes (except with respect to issue date and the date from which interest accrues).

PGTI intends to use the proceeds from the sale of the Additional Notes to finance, together with cash on hand, the cash portion of the purchase price of the acquisition (the “ECO Acquisition”) by the Company of 75% of the outstanding equity interests of New Eco Windows Holding, LLC (“New Holding”), a newly formed Delaware limited liability company formed for the purposes of facilitating the ECO Acquisition, which will hold 100% of the equity interests of ECO Window Systems, LLC, ECO Glass Production Inc. and Unity Windows Inc. (collectively, “ECO”). The ECO Acquisition was previously announced on January 7, 2021 and is expected to close in the first quarter of 2021. If the ECO Acquisition does not close, PGTI intends to apply proceeds of the Additional Notes to repay amounts outstanding under its existing term loan credit facility and for general corporate purposes, including future acquisitions.

The Additional Notes are guaranteed, jointly and severally, by each existing and future domestic restricted subsidiary of the Company, other than any restricted subsidiary of the Company that does not guarantee the Company’s existing senior secured credit facilities or any permitted refinancing thereof. Upon the consummation of the ECO Acquisition, the Company intends to designate New Holding and its subsidiaries as unrestricted subsidiaries under the indenture governing the Existing Notes and New Notes and the credit agreement governing the Company’s existing senior secured credit facilities such that New Holding and its subsidiaries will not become guarantors of the Existing Notes and New Notes or guarantors of the Company’s existing senior secured credit facilities.

The Additional Notes and related guarantees were offered and sold only to persons reasonably believed to be qualified institutional buyers under Rule 144A of the Securities Act of 1933 (“the Securities Act”), and to non-U.S. persons in transactions outside the United States under Regulation S of the Securities Act. The Additional Notes have not been, and will not be, registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and other applicable securities laws.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the federal securities laws. Forward-looking statements are statements other than historical fact, and include statements relating to the offering of Additional Notes, including the use of proceeds therefrom. These “forward-looking statements” involve risks and uncertainties which could cause actual results to differ materially from those contained in the forward-looking statements. Such forward-looking statements generally can be identified by the use of forward- looking terminology, such as “may,” “expect,” “expectations,” “outlook,” “forecast,” “guidance,” “intend,” “believe,” “could,” “project,” “estimate,” “anticipate,” “should” and similar terminology. These risks and uncertainties include factors such as:

• the impact of the COVID-19 pandemic and related measures taken by governmental or regulatory authorities to combat the pandemic, including the impact of the pandemic and these measures on the economies and demand for our products in the states where we sell them, and on our customers, suppliers, labor force, business, operations and financial performance;
• the ability to successfully integrate the operations of ECO or to complete the integration of NewSouth Window Solutions (“NewSouth”) into our existing operations and the diversion of management’s attention from ongoing business and regular business responsibilities to effect such integration;
• disruption from our recent or future acquisitions or increased expenses or unanticipated liabilities making it more difficult to maintain relationships with customers or suppliers of acquired businesses;
• adverse changes in new home starts and home repair and remodeling trends, especially in the state of Florida and the western United States, where the substantial portion of our sales are currently generated, and in the U.S. generally;
• macroeconomic conditions in Florida, where the substantial portion of our sales of impact-resistant products are generated, and in California, Texas, Arizona, Nevada, Colorado, Oregon, Washington and Hawaii, where the substantial portion of the sales of our indoor/outdoor living products are currently generated, and in the U.S. generally;
• our level of indebtedness, which increased in c

FAQ

What is the significance of PGT Innovations' recent private offering of $60 million in senior notes?

PGT Innovations' $60 million offering aims to support the acquisition of New Eco Windows Holding, enhancing its market position.

How will PGT Innovations use the proceeds from the additional senior notes?

The proceeds will finance the cash portion of the ECO Acquisition; if the deal fails, funds will repay existing debts.

What risks are associated with PGT Innovations' forward-looking statements?

Risks include potential impacts from COVID-19 and challenges integrating acquired businesses, which could affect operations.

What is the maturity date of the additional senior notes issued by PGT Innovations?

The additional senior notes are due in 2026.

How does the additional offering relate to PGT Innovations' existing senior notes?

The additional notes rank equally with existing 6.75% senior notes, forming a single series with them.