UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


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

For the quarterly period ended: ~~September~~March 30, ~~2023~~2024


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

For the transition period from to

Commission file number: 1-14315

Cornerstone Building Brands, Inc.

(Exact name of registrant as specified in its charter)


Delaware			76-0127701
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

5020 Weston Parkway

Suite 400

Cary

27513

(Address of principal executive offices)

(Zip Code)

(866) 419-0042

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Exchange Act: None

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 ý

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). ý Yes ¨ No

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

Large accelerated filer ý¨ Accelerated filer ☐ Non-accelerated filer ¨ý (Do not check if a smaller reporting company) Smaller reporting company ☐ Emerging growth company ☐

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. ¨

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

APPLICABLE ONLY TO CORPORATE ISSUERS

There are no longer publicly traded shares of common stock of Cornerstone Building Brands, Inc.


Table of Contents

TABLE OF CONTENTS

	Part I — Financial Information
	Part I — Unaudited Financial Information
Item 1.	Condensed Consolidated Financial Statements	1
	Condensed Consolidated Statements of Income (Loss)	1
	Condensed Consolidated Statements of Loss	1
	Condensed Consolidated Statements of Comprehensive (Loss) Income	2
	Condensed Consolidated Statements of Comprehensive Loss	2
	Condensed Consolidated Balance Sheets	3
	Condensed Consolidated Statements of Equity	4
	Condensed Consolidated Statements of Cash Flows	65
	Notes to Condensed Consolidated Financial Statements	76
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2417
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	3424
Item 4.	Controls and Procedures	3524
	Part II — Other Information
Item 1.	Legal Proceedings	3625
Item 1A.	Risk Factors	3625
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	36
Item 6.	Exhibits	26
Item 6.	Exhibits	37


Table of Contents

PART I — UNAUDITED FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements.

CORNERSTONE BUILDING BRANDS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF ~~INCOME (~~LOSS)

(In thousands~~, except per share data~~)

(Unaudited)

	Successor				Predecessor		Successor				Predecessor
	Three Months Ended
	Period fromJuly 2, 2023throughSeptember 30, 2023		Period fromJuly 25, 2022throughOctober 1, 2022		Period fromJuly 3, 2022throughJuly 24, 2022		Period fromJanuary 1, 2023throughSeptember 30, 2023		Period fromJuly 25, 2022throughOctober 1, 2022		Period fromJanuary 1, 2022throughJuly 24, 2022
	March 30, 2024		April 1, 2023
Net sales	$	1,~~424~~145,~~758~~687	$	1,~~274~~279,~~883~~088	$	~~365,445~~	$	~~4,132,064~~	$	~~1,274,883~~	$	~~3,736,084~~
Cost of sales	1912,~~091,691~~131		1997,~~041,260~~227		~~292,047~~		~~3,219,299~~		~~1,041,260~~		~~2,929,699~~
Gross profit	~~333~~233,~~067~~556		~~233~~281,~~623~~861		~~73,398~~		~~912,765~~		~~233,623~~		~~806,385~~
Selling, general and administrative expenses	~~228~~240,~~621~~845		~~184~~227,~~826~~801		~~86,063~~		~~703,428~~		~~184,826~~		~~562,836~~
Loss (gain) on divestitures	10,080		1,762		—		10,080		1,762		(401,413)
(Loss) income from operations	(7,289)		54,060
Gain on legal settlements	—		—		—		—		—		(76,575)
Interest expense	(94,820)		(94,111)
Income (loss) from operations	94,366		47,035		(12,665)		199,257		47,035		721,537
Foreign exchange (loss) gain	(4,013)		2,017
Interest expense	(91,013)		(65,813)		(11,401)		(277,438)		(65,813)		(101,078)
Loss on extinguishment of debt	—		(563)
Foreign exchange (loss) gain	(3,753)		12,489		(454)		2,694		12,489		686
Other income, net	2,883		1,173
Gain (loss) on extinguishment of debt	—		—		24,801		(184)		—		28,354
Loss before income taxes	(103,239)		(37,424)
Other income, net	4,027		172		114		8,832		172		101
Income tax provision (benefit)	15,334		(8,609)
Income (loss) before income taxes	3,627		(6,117)		395		(66,839)		(6,117)		649,600
Net loss	$	(118,573)	$	(28,815)
Income tax provision (benefit)	890		(1,672)		(1,049)		(18,435)		(1,672)		165,814
Net income (loss)	2,737		(4,445)		1,444		(48,404)		(4,445)		483,786
Net loss allocated to participating securities	—		—		(11)		—		—		(3,575)
Net income (loss) applicable to common shares	$	2,737	$	(4,445)	$	1,433	$	(48,404)	$	(4,445)	$	480,211
Income per common share:
Basic					$	0.01					$	3.77
Diluted					$	0.01					$	3.73
Weighted average number of common shares outstanding:
Basic					127,544						127,316
Diluted					129,127						128,894

See accompanying notes to the condensed consolidated financial statements.


Table of Contents

CORNERSTONE BUILDING BRANDS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS~~) INCOME~~

(In thousands)

(Unaudited)

	Successor				Predecessor		Successor				Predecessor
	Three Months Ended
	Period fromJuly 2, 2023throughSeptember 30, 2023		Period fromJuly 25, 2022throughOctober 1, 2022		Period fromJuly 3, 2022throughJuly 24, 2022		Period fromJanuary 1, 2023throughSeptember 30, 2023		Period fromJuly 25, 2022throughOctober 1, 2022		Period fromJanuary 1, 2022throughJuly 24, 2022
	March 30, 2024		April 1, 2023
Comprehensive (loss) income:
Net loss	$	(118,573)	$	(28,815)
Net income (loss)	$	2,737	$	(4,445)	$	1,444	$	(48,404)	$	(4,445)	$	483,786
Other comprehensive income (loss) income, net of tax:
Other comprehensive (loss) income, net of tax:
Foreign exchange translation loss	(2,181)		(963)
Foreign currency translation adjustments	(6,059)		(29,743)		115		(6,539)		(29,743)		(1,367)
Unrealized gain (loss) on derivative instruments, net of income tax of $(2,484) and $3,354	8,314		(10,892)
Unrealized (loss) gain on derivative instruments, net of income tax of $114, $(14,890), $(472), $(1,105), $(14,890) and $(16,432)	(373)		40,988		(778)		3,589		40,988		62,462
Other comprehensive income (loss)	6,133		(11,855)
Amount reclassified from accumulated other comprehensive (loss) income into earnings relating to derivative instruments	—		—		1,682		—		—		16,258
Comprehensive loss	$	(112,440)	$	(40,670)
Changes in retirement related benefit plans	—		—		—		—		—		(1,122)
Other comprehensive (loss) income	(6,432)		11,245		1,019		(2,950)		11,245		76,231
Comprehensive (loss) income	$	(3,695)	$	6,800	$	2,463	$	(51,354)	$	6,800	$	560,017

See accompanying notes to the condensed consolidated financial statements.


Table of Contents

CORNERSTONE BUILDING BRANDS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

(Unaudited)

	Successor
	March 30, 2024		December 31, 2023
	September 30, 2023		December 31, 2022
ASSETS
Current assets:
Cash and cash equivalents	$	~~475~~117,~~820~~299	$	~~553~~468,~~551~~877
Accounts receivable, net	~~730~~617,~~079~~132		~~665~~596,~~936~~621
Inventories	~~512~~550,~~417~~260		~~551~~496,~~828~~839
Other current assets	7547,~~553~~871		~~125~~73,~~306~~987
Total current assets	1,~~793~~332,~~869~~562		1,~~896~~636,~~621~~324
Property, plant and equipment, net	~~848~~892,~~991~~318		~~618~~889,~~064~~103
Lease right-of-use assets	~~344~~399,~~410~~656		365,~~552~~292
Goodwill	1,~~620~~685,~~185~~183		1,~~688~~681,~~548~~764
Intangible assets, net	2,~~258~~232,~~760~~491		2,~~519~~286,~~023~~068
Other assets, net	~~107~~82,~~356~~493		~~105~~74,~~842~~790
Total assets	$	6,~~973~~624,~~571~~703	$	76,~~193~~933,~~650~~341
LIABILITIES AND EQUITY
Current liabilities:
Current portion of long-term debt	$	29,000	$	29,000
Current portion of lease liabilities	61,489		61,899
Short-term borrowings	100,000		—
Accounts payable	270,307		288,938
Current portion of lease liabilities	74,336		64,711
Accrued income and other taxes	38,777		21,867
Accounts payable	242,934		255,227
Employee-related liabilities	119,234		184,187
Accrued income and other taxes	140,497		57,058
Rebates, warranties and other customer-related liabilities	168,206		157,752
Employee-related liabilities	81,914		113,081
Other current liabilities	117,595		149,596
Rebates, warranties and other customer-related liabilities	125,613		151,990
Total current liabilities	804,608		893,239
Other current liabilities	103,255		129,327
Long-term debt	3,369,464		3,366,588
Total current liabilities	897,549		800,394
Long-term lease liabilities	266,162		302,339
Long-term debt	3,395,921		3,382,550
Deferred income tax liabilities	606,512		653,745
Long-term lease liabilities	308,367		287,304
Other long-term liabilities	242,570		248,794
Deferred income tax liabilities	466,009		556,935
Total liabilities	$	5,289,316	$	5,464,705
Other long-term liabilities	254,460		261,288
Commitments and contingencies (Note 12)
Total liabilities	$	5,322,306	$	5,288,471
Commitments and contingencies (Note 13)
Equity:
Common stock, $0.01 par value, 1,000 shares authorized, issued and outstanding at September 30, 2023 and December 31, 2022	$	—	$	—
Common stock, $0.01 par value, 1,000 shares authorized, issued and outstanding at March 30, 2024 and December 31, 2023	$	—	$	—
Additional paid-in capital	1,~~764~~535,~~596~~991		1,~~757~~766,~~932~~024
Accumulated deficit	(~~111~~257,~~900~~594)		(63139,~~496~~021)
Accumulated other comprehensive income	3124,~~559~~000		3417,~~509~~867
Total equity	1,~~684~~302,~~255~~397		1,~~728~~644,~~945~~870
Total liabilities and equity	$	6,~~973~~624,~~571~~703	$	76,~~193~~933,~~650~~341

See accompanying notes to the condensed consolidated financial statements.


Table of Contents

CORNERSTONE BUILDING BRANDS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY
(In thousands, except share data)
(Unaudited)
	Common Stock			Additional Paid-In Capital		(Accumulated Deficit~~) Retained Earnings~~		Accumulated Other Comprehensive Income ~~(Loss)~~		~~Treasury~~Total ~~Stock~~Equity				~~Total Equity~~
	Shares	Amount								~~Shares~~		~~Amount~~
Balance, July 1, 2023 (Successor)	1,000	$	—	$	1,762,739	$	(114,637)	$	37,991	—		$	—	$	1,686,093
Balance, December 31, 2023	1,000	$	—	$	1,766,024	$	(139,021)	$	17,867	$	1,644,870
Other comprehensive loss	—	—		—		—		(6,432)		—		—		(6,432)
Other comprehensive income	—	—		—		—		6,133		6,133
Share-based compensation	—	—		1,~~857~~592		—		—		—1,592		—		~~1,857~~
Net income	—	—		—		2,737		—		—		—		2,737
Dividend to Parent	—	—		(231,625)		—		—		(231,625)
Balance, September 30, 2023 (Successor)	1,000	$	—	$	1,764,596	$	(111,900)	$	31,559	—		$	—	$	1,684,255
Net loss	—	—		—		(118,573)		—		(118,573)
Balance, July 2, 2022 (Predecessor)	127,544,041	$	1,275	$	1,292,458	$	383,516	$	69,600	—		$	—	$	1,746,849
Balance, March 30, 2024	1,000	$	—	$	1,535,991	$	(257,594)	$	24,000	$	1,302,397
Other comprehensive income	—	—		—		—		1,019		—		—		1,019
Balance, December 31, 2022	1,000	$	—	$	1,757,932	$	(63,496)	$	34,509	$	1,728,945
Share-based compensation	—	—		937		—		—		—		—		937
Other comprehensive loss	—	—		—		—		(11,855)		(11,855)
Net income	—	—		—		1,444		—		—		—		1,444
Share-based compensation	—	—		2,492		—		—		2,492
Balance, July 24, 2022 (Predecessor)	127,544,041	$	1,275	$	1,293,395	$	384,960	$	70,619	—		$	—	$	1,750,249
Other	—	—		(170)		—		—		(170)
Pushdown fair value adjustments	—	$	—	$	1,978,011	$	(384,960)	$	(70,619)	—		$	—	$	1,522,432
Net loss	—	—		—		(28,815)		—		(28,815)
Payments to public shareholders	(65,413,135)	(654)		(1,611,780)		—		—		—		—		(1,612,434)
Balance, April 1, 2023	1,000	$	—	$	1,760,254	$	(92,311)	$	22,654	$	1,690,597
Recapitalization of outstanding common shares	(62,129,906)	(621)		621		—		—		—		—		—
Contributions from parent, net	—	—		95,194		—		—		—		—		95,194
Balance, July 25, 2022 (Successor)	1,000	—		1,755,441		—		—		—		—		1,755,441
Other comprehensive income	—	—		—		—		11,245		—		—		11,245
Net loss	—	—		—		(4,445)		—		—		—		(4,445)
Balance, October 1, 2022 (Successor)	1,000	$	—	$	1,755,441	$	(4,445)	$	11,245	—		$	—	$	1,762,241

See accompanying notes to the condensed consolidated financial statements.


Table of Contents

CORNERSTONE BUILDING BRANDS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (continued)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, except share data)
(In thousands)
(Unaudited)
	Common Stock				Additional Paid-In Capital		(Accumulated Deficit) Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock			Total Equity
	Three Months Ended
	Shares		Amount								Shares	Amount
	March 30, 2024		April 1, 2023
Balance, December 31, 2022 (Successor)	1,000		$	—	$	1,757,932	$	(63,496)	$	34,509	—	$	—	$	1,728,945
Cash flows from operating activities:
Other comprehensive loss	—		—		—		—		(2,950)		—	—		(2,950)
Net loss	$	(118,573)	$	(28,815)
Share-based compensation	—				6,834		—		—		—	—		6,834
Adjustments to reconcile net loss to net cash used in operating activities:
Other	—		—		(170)		—		—		—	—		(170)
Depreciation and amortization	94,317		72,662
Net loss	—		—		—		(48,404)		—		—	—		(48,404)
Amortization of debt issuance costs, debt discount and fair values	23,876		22,763
Balance, September 30, 2023 (Successor)	1,000		$	—	$	1,764,596	$	(111,900)	$	31,559	—	$	—	$	1,684,255
Share-based compensation expense	1,592		2,492
Balance, December 31, 2021 (Predecessor)	126,992,107		$	1,270	$	1,279,931	$	(98,826)	$	(5,612)	(21,071)	$	(424)	$	1,176,339
Non-cash lease expense	1,046		—
Treasury stock purchases	—		—		—		—		—		(192,773)	(4,627)		(4,627)
Gain on extinguishment of debt	—		563
Retirement of treasury shares	(192,773)		(2)		(4,625)		—		—		192,773	4,627		—
Loss on sale of assets	2,452		169
Issuance of restricted stock	611,178		6		(6)		—		—		—	—		—
Provision for credit losses	1,208		1,667
Stock options exercised	133,529		1		1,420		—		—		—	—		1,421
Deferred income taxes	(92,479)		(71,338)
Other comprehensive income	—		—		—		—		76,231		—	—		76,231
Changes in operating assets and liabilities, net of effect of acquisitions:
Deferred compensation obligation	—		—		(424)		—		—		21,071	424		—
Accounts receivable	(28,679)		43,029
Share-based compensation	—		—		17,099		—		—		—	—		17,099
Inventories	(54,213)		(20,029)
Net income	—		—		—		483,786		—		—	—		483,786
Income taxes	28,205		45,263
Balance, July 24, 2022 (Predecessor)	127,544,041		$	1,275	$	1,293,395	$	384,960	$	70,619	—	$	—	$	1,750,249
Prepaid expenses and other	(9,568)		3,886
Pushdown fair value adjustments	—		$	—	$	1,978,011	$	(384,960)	$	(70,619)	—	$	—	$	1,522,432
Accounts payable	(17,983)		(35,096)
Payments to public shareholders	(65,413,135)		(654)		(1,611,780)		—		—		—	—		(1,612,434)
Accrued expenses	5,934		(140,488)
Recapitalization of outstanding common shares	(62,129,906)		(621)		621		—		—		—	—		—
Other, net	(832)		(7,299)
Contributions from parent, net	—		—		95,194		—		—		—	—		95,194
Net cash flows from operating activities	(163,697)		(110,571)
Balance, July 25, 2022 (Successor)	1,000		—		1,755,441		—		—		—	—		1,755,441
Cash flows from investing activities:
Other comprehensive income	—		—		—		—		11,245		—	—		11,245
Capital expenditures	(52,444)		(41,706)
Net loss	—		—		—		(4,445)		—		—	—		(4,445)
Proceeds from sale of property, plant and equipment	2,776		—
Balance, October 1, 2022 (Successor)	1,000		$	—	$	1,755,441	$	(4,445)	$	11,245	—	$	—	$	1,762,241
Net cash flows from investing activities	(49,668)		(41,706)
Cash flows from financing activities:
Proceeds from short-term borrowings	100,000		—
Payments on term loans	(7,250)		(6,500)
Repurchases of senior notes	—		(15,500)
Dividend payment to parent	(231,625)		—
Net cash flows from financing activities	(138,875)		(22,000)
Effect of exchange rate changes on cash and cash equivalents	662		(43)
Net decrease in cash and cash equivalents	(351,578)		(174,320)
Cash and cash equivalents at beginning of period	468,877		553,551
Cash and cash equivalents cash at end of period	$	117,299	$	379,231

See accompanying notes to the condensed consolidated financial statements.


Table of Contents

CORNERSTONE BUILDING BRANDS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
	Successor				Predecessor
	Period fromJanuary 1, 2023throughSeptember 30, 2023		Period fromJuly 25, 2022throughOctober 1, 2022		Period fromJanuary 1, 2022throughJuly 24, 2022
Cash flows from operating activities:
Net (loss) income	$	(48,404)	$	(4,445)	$	483,786
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:
Depreciation and amortization	331,077		56,260		166,177
Amortization of debt issuance costs, debt discount and fair values	68,192		17,443		19,952
Share-based compensation expense	6,834		8,838		17,099
Gain on extinguishment of debt	184		—		(28,354)
Unrealized gain on foreign currency exchange rates	(2,200)		—		—
Asset impairments	—		—		368
Loss (gain) on divestiture	10,080		1,762		(401,413)
Loss (gain) on sale of assets	260		—		(2,670)
Amortization of inventory and other fair value step-ups	—		30,317		1,238
Provision for credit losses	5,249		1,111		3,811
Deferred income taxes	(90,903)		(34,609)		(26,688)
Changes in operating assets and liabilities, net of effect of acquisitions and divestitures:
Accounts receivable	(62,914)		921		(101,937)
Inventories	46,758		55,457		(12,956)
Income taxes	22,100		(15,775)		14,116
Prepaid expenses and other	14,052		(6,199)		31,367
Accounts payable	(21,146)		12,636		64,044
Accrued expenses	(84,882)		(112,026)		121,871
Other, net	(13,178)		(43,482)		854
Net cash provided by (used in) operating activities	181,159		(31,791)		350,665
Cash flows from investing activities:
Acquisitions, net of cash acquired	(67,834)		—		4,252
Capital expenditures	(125,700)		(24,402)		(64,848)
(Payments) proceeds from divestitures, net of cash divested	(10,080)		—		510,883
Proceeds from sale of property, plant and equipment	—		—		6,070
Net cash (used in) provided by investing activities	(203,614)		(24,402)		456,357
Cash flows from financing activities:
Contributions from Parent, net	—		95,194		—
Payments to public stockholders	—		(1,612,434)		—
Proceeds from term loans	—		300,000		—
Payments on term loans	(21,750)		(6,500)		(13,000)
Proceeds from senior notes	—		710,000		—
Repurchases of senior notes	(33,885)		—		(70,560)
Payments of financing costs	—		(84,686)		—
Payments on derivative financing obligations	—		—		(7,321)
Other	—		—		(3,206)
Net cash used in financing activities	(55,635)		(598,426)		(94,087)
Effect of exchange rate changes on cash and cash equivalents	(104)		240		(5)
Net decrease in cash and cash equivalents	(78,194)		(654,379)		712,930
Cash and cash equivalents at beginning of period	554,014		1,109,588		396,658
Cash and cash equivalents cash at end of period	$	475,820	$	455,209	$	1,109,588

See accompanying notes to the condensed consolidated financial statements.

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CORNERSTONE BUILDING BRANDS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in thousands, except share and per share data, unless otherwise noted)

(Unaudited)

Note 1 — Basis of Presentation

Description of Business

Cornerstone Building Brands, Inc. (“Cornerstone Building Brands” or, collectively with its subsidiaries, unless the context requires otherwise, the “Company”) is a holding company incorporated in Delaware. The Company is ~~the~~a ~~largest~~leading exterior building products manufacturer by sales in North America and serves residential and commercial customers across new construction and the repair and remodel end markets. The Company is organized ininto three reportable segments: Aperture Solutions, Surface Solutions and Shelter Solutions.

Organization and Ownership Structure

On July 25, 2022 and pursuant to an Agreement and Plan of Merger dated March 5, 2022 (the “Merger Agreement”) by and among the Company, Camelot Return Intermediate Holdings, LLC (“Camelot Parent”) and Camelot Return Merger Sub, Inc. (“Merger Sub”), investment funds managed by Clayton, Dubilier and Rice, LLC (“CD&R”) became the indirect owners of all the issued and outstanding shares of common stock of Cornerstone Building Brands. Pursuant to the Merger Agreement, Merger Sub merged with and into the Company (the “Merger”), with the Company surviving the Merger as a subsidiary of Camelot Parent (the “Surviving Corporation”). At the effective time of the Merger (the “Effective Time”), the Company became a privately held company and its shares were no longer traded on the New York Stock Exchange.

At the Effective Time, in accordance with the terms and conditions set forth in the Merger Agreement, each share of Company common stock outstanding immediately prior to the Effective Time of the Merger (other than (i) shares of Company common stock that were cancelled or converted into shares of common stock of the Surviving Corporation in accordance with the Merger Agreement and (ii) shares of Company common stock held by stockholders of the Company (other than CD&R, certain investment funds managed by CD&R and other affiliates of CD&R that held shares of Company common stock) who did not vote in favor of the Merger Agreement or the Merger and who have perfected and not withdrawn a demand for appraisal rights pursuant to Section 262 of the General Corporation Law of the State of Delaware), was converted into the right to receive cash in an amount equal to $24.65 in cash per share, without interest and subject to any required withholding taxes.

On July 25, 2022, the Company amended its Certificate of Incorporation to authorize 1,000 shares of common stock, par value of $0.01. Each share of common stock will have one vote and all shares of common stock vote together as a single class.

Basis of Presentation

The accompanying Condensed Consolidated Financial Statements are presented in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These Condensed Consolidated Financial Statements have been prepared in accordance with the Company's accounting policies and on the same basis as those financial statements included in the Company’s latest Annual Report on Form 10-K for the year ended December 31, ~~2022~~2023 and should be read in conjunction with those Consolidated Financial Statements and the Notes thereto. Certain disclosures normally included in the Company’s Consolidated Financial Statements prepared in accordance with U.S. GAAP have been omitted on a basis consistent with the rules and regulations of the SEC.

The accompanying Condensed Consolidated Financial Statements include the accounts and operations of the Company and its majority-owned subsidiaries and all adjustments (consisting of normal recurring adjustments) that the Company considered necessary to present a fair statement of its results of operations, financial position and cash flows. All significant intercompany accounts and transactions have been eliminated in consolidation. Through application of pushdown accounting, the Company’s Condensed Consolidated Financial Statements are presented as Predecessor for periods prior to the Merger and Successor for subsequent periods. The Company has reclassified certain prior year amounts to conform to the current year’s presentation. The results reported in these Condensed Consolidated Financial Statements should not be regarded as necessarily indicative of results that may be expected for the entire year.

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Note 2 — Significant Accounting Policies

Summary of Significant Accounting Policies

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, ~~revenues~~net sales and expenses, and related disclosures of contingent assets and liabilities in the Condensed Consolidated Financial Statements and accompanying notes. These estimates include, but are not limited to: establishing the allowance for expected credit losses; allowance for obsolete inventory; the impairment of goodwill and intangible assets; establishing useful lives for and evaluating the recovery of long-lived assets; recognizing the fair value of assets acquired and liabilities assumed in business combinations; determining the fair value of contingent considerations; accounting for rebates and product warranties; the valuation and expensing for share-based compensation; certain assumptions made in accounting for pension benefits; accounting for contingencies and uncertainties and accounting for income taxes. Actual results may differ from the estimates used in preparing the Condensed Consolidated Financial Statements.

Cash and Cash Equivalents

Cash and cash equivalents mainly consist of highly liquid, unrestricted savings, checking, money market funds with original maturities of less than three months and other bank accounts.

The following table sets forth the components of cash and cash equivalents:

	Successor
	March 30, 2024		December 31, 2023
	September 30, 2023		December 31, 2022
Cash	$	117,299	$	228,975
Cash	$	215,693	$	553,551
Money market funds (Level 1 securities)	—		239,902
Money market funds (Level 1 securities)	260,127		—
Total cash and cash equivalents	$	117,299	$	468,877
Total cash and cash equivalents	$	475,820	$	553,551


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Accounts Receivable, Net

The Company reports accounts receivable net of an allowance for expected credit losses. The Company establishes provisions for expected credit losses based on the Company’s assessment of the collectability of amounts owed to the Company by its customers. Such allowances are included in selling, general and administrative expenses in the Company’s Condensed Consolidated Statements of Loss. In establishing the allowance, the Company considers changes in the financial position of a customer, age of the accounts receivable balances, availability of security, unusual macroeconomic conditions, lien rights and bond rights as well as disputes, if any, with its customers. Uncollectible accounts are written off when a settlement is reached for an amount that is less than the outstanding historical balance, all collection efforts have been exhausted or any legal action taken by the Company has concluded. The Company’s allowance for expected credit losses was $6.54 million and $29.16 million at ~~September~~ March 30, ~~2023~~2024 and December 31, ~~2022~~2023.

Fair Value Measurements

The carrying amounts of cash and cash equivalents, trade accounts receivable and accounts payable approximate fair value as of ~~September~~ March 30, ~~2023~~2024 and December 31, ~~2022~~2023 given the instruments’ relatively short maturities. The carrying amounts of the indebtedness under revolving credit facilities approximate fair value as the interest rates are variable and reflective of market rates. Fair values for our other debt instruments are measured using Level 1 and Level 2 inputs. U.S. GAAP requires us to use valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized as follows:

Level 1: Observable inputs such as quoted prices for identical assets or liabilities in active markets.

Level 2: Other inputs that are observable directly or indirectly, such as quoted prices for similar assets or liabilities or market-corroborated inputs.

Level 3: Unobservable inputs for which there is little or no market data and which require us to develop our own assumptions about how market participants would price the assets or liabilities.

8In connection with certain business acquisitions, the Company periodically enters into agreements that require us to pay additional consideration to the relevant seller. These payments are contingent on the achievement of specified EBITDA targets in periods subsequent to the acquisition. The fair value of contingent consideration is based on unobservable, or Level 3, inputs including a probability-weighted average payout approach. Contingent consideration obligations are measured at fair value each reporting period and any adjustments to fair value are recognized in earnings in the period they are identified. The Company has not made any changes to the methods used to determine the fair value of its contingent consideration obligations.

Recent Accounting Pronouncements

In November 2023, the FASB issued Accounting Standards Update (“ASU”) No. 2023-07, Improvements to Reportable Segment Disclosures (Topic 280). This ASU updates reportable segment disclosure requirements by requiring disclosures of significant reportable segment expenses that are regularly provided to the Chief Decision Maker (“CODM”) and included within each reported measure of a segment’s profit or loss. This ASU also requires disclosure of the title and position of the individual identified as the CODM and an explanation of how the CODM uses the reported measures of a segment’s profit or loss in assessing segment performance and deciding how to allocate resources. The ASU is effective for annual periods beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. Adoption of the ASU should be applied retrospectively to all prior periods presented in the financial statements. Early adoption is also permitted. The ASU will likely result in us including the additional required disclosures when adopted. We are currently evaluating the provisions of this ASU and expect to adopt them for the year ending December 31, 2024.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which establishes new income tax disclosure requirements in addition to modifying and eliminating certain existing requirements. The new guidance requires consistent categorization and greater disaggregation of information in the rate reconciliation, as well as further disaggregation of income taxes paid. This change is effective for annual periods beginning after December 15, 2024. Prospective application is required, with retrospective application permitted. The Company is currently evaluating the effect the updated guidance will have on its financial statement disclosures.


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Note 3 — ~~Mergers and~~ Acquisitions

~~CD&R~~Acquisitions ~~Merger~~Completed ~~Transaction~~During 2023

OnIn ~~July 25~~August 2023, ~~2022~~the Company completed the acquisition of M.A.C. Métal Architectural Inc. (“MAC Metal”), ~~Merger~~which ~~Sub~~became ~~merged~~an ~~with~~indirect ~~and~~wholly-owned ~~into~~subsidiary of the Company. Headquartered in Saint-Hubert, ~~with~~Quebec, ~~the~~MAC ~~Company~~Metal ~~surviving~~serves the ~~Merger~~North asAmerican aresidential ~~subsidiary~~and ofcommercial ~~Camelot~~markets ~~Parent.~~with ~~CD&R~~high-end ~~previously~~steel ~~held~~siding 61and roofing products.9 ~~million~~MAC ~~shares~~Metal ofis included in the Company’s ~~common~~Surface ~~stock~~Solutions ~~immediately~~reportable ~~prior~~segment. toIn December 2023, the ~~Merger.~~Company Ascompleted athe ~~result~~acquisition of the ~~Merger~~Eastern Architectural Systems (“EAS”) business, ~~CD&R~~whose ~~became~~operations are included in the ~~indirect~~Company’s ~~owners~~Aperture ofSolutions ~~all~~reportable ~~the~~segment. ~~issued~~EAS ~~and~~is ~~outstanding~~based ~~shares~~in ofFt. ~~Company~~Myers, ~~common~~Florida ~~stock~~and ~~that~~manufactures ~~CD&R~~custom-made ~~did~~aluminum ~~not~~and ~~already~~vinyl ~~own~~impact windows and doors.

The ~~Merger~~total ~~was~~purchase ~~accounted~~price for asthese acquisitions was $234.9 million comprised of upfront cash payments of $217.7 million and earn-out contingent consideration of $16.8 million related to the MAC Metal transaction. The EAS transaction is subject to a ~~business~~final ~~combination~~working capital adjustment. The purchase price of these acquisitions was provisionally allocated to the assets acquired and liabilities assumed, ~~based~~which onrelated ~~the~~primarily ~~estimated~~to ~~fair~~inventory ~~market~~of ~~value~~$15.9 million, atproperty, plant and equipment of $21.3 million, goodwill of $87.5 million, intangible assets such as, customer lists and trademarks, of $73.4 million and $34.3 million, contingent consideration of $16.8 million and noncurrent deferred income tax liabilities of $12.3 million. The goodwill recorded is a result of expected synergies and other benefits that we believe will result from the ~~date~~integration of the ~~Merger~~acquisitions with our operations.

The ~~Merger~~MAC ~~was~~Metal ~~funded~~acquisition inearn-out ~~part~~is payable over two consecutive twelve-month periods, with ~~proceeds~~the ~~from~~first period starting in the month following ~~issuances:~~the close of the applicable acquisition and payments are based upon achieving certain adjusted EBITDA-based metrics, as defined in the purchase agreement. There was no change to the fair-value of the contingent consideration of $16.8 million, of which $7.8 million is recognized in other current liabilities and $9.0 million is recognized in other long-term liabilities on our Condensed Consolidated Balance Sheets at March 30, 2024.

~~•$300.0~~2024 ~~million~~Pending ~~aggregate principal amount term loan facility, due August 2028;~~Acquisition

~~•$710~~In March 2024, the Company reached an agreement to acquire Harvey Building Products Corp.0 ~~million~~(“Harvey”), a manufacturer of 8high performing windows and doors, and its portfolio of industry leading brands: Harvey, Softlite and Thermo-Tech.~~750%~~ ~~Senior~~Headquartered ~~Secured~~in ~~Notes~~Waltham, ~~due~~Massachusetts, ~~August 2028;~~Harvey has approximately 1,200 employees at four manufacturing facilities located throughout the Northeast and Midwest. Harvey specializes in premium, custom windows and doors primarily serving the Eastern United States (“U.S.”). The transaction is subject to regulatory approval and customary closing conditions and is expected to close in the second quarter of 2024. Upon closing, the business will be integrated into our Aperture Solutions reportable segment.

•$564.4 million of cash from the Company;

•$464.4 million aggregate principal amount of 2.99% senior payment-in-kind notes due 2029 (“2.99% Senior Notes”) that were issued by Camelot Return Parent, LLC (“Camelot Return Parent”), an indirect parent of the Company, and are held by Arawak X, L.P., an affiliate of CD&R; and

•$195.0 million from preferred shares of Camelot Return Parent.

Neither the Company nor any of its subsidiaries is a guarantor of or is obligated to make any payments related to the 2.99% Senior Notes issued by Camelot Return Parent.

The calculation of the total consideration paid is as follows:

	Consideration
Common shares purchased	65,613,349
Common share closing price	$	24.65
Merger consideration, common shares purchased	$	1,617,369
Effective settlement of pre-existing relationships (1)	128,721
Total merger consideration	1,746,090
Fair value of common shares previously held by CD&R and other adjustments (2)	1,526,591
Total equity value	$	3,272,681

(1) Consists mainly of employee share-based compensation awards that were outstanding at that time the Merger was consummated.

(2) Consists of 61.9 million common shares, held by CD&R prior to the Merger which were rolled over or acquired by Camelot Parent.

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The following table summarizes the fair value of net assets acquired:

	Fair Value
Merger consideration	$	1,746,090
Fair value of common shares previously held by CD&R and other adjustments	1,526,591
Total equity value	$	3,272,681
Cash and cash equivalent	$	1,087,586
Accounts receivable	793,858
Inventories	767,460
Property, plant and equipment	873,167
Lease right-of-use assets	275,050
Goodwill	1,599,327
Intangible assets	2,436,000
Other assets	119,920
Total assets acquired	7,952,368
Accounts payable	329,896
Accrued liabilities	634,915
Long-term debt	2,467,210
Long-term lease liabilities	252,262
Deferred income tax liabilities	706,768
Other liabilities	288,636
Total liabilities assumed	4,679,687
Net assets acquired	$	3,272,681

During the three months ended July 1, 2023, the Company made measurement period adjustments, which were mainly composed of a $291.5 million increase to property, plant and equipment and a $174.7 million decrease to intangible assets. The effect of measurement period adjustments on the estimated fair value elements were reflected as if the adjustments had been made as of the date of the Merger, including a $66.5 million cumulative catch-up to depreciation and amortization expense recorded during the three months ended July 1, 2023 resulting from the update in the fair market value of property, plant and equipment and intangible assets. The table below presents the Consolidated Statements of (Loss) Income line items impacted by the aforementioned adjustments for previously reported periods.

	Increase / (Decrease) due to Depreciation and Amortization
Consolidated Statements of (Loss) Income Line Item	July 25, 2022throughDecember 31, 2022		Three Months Ended April 1, 2023		Cumulative Catch-Up Recorded During Three Months Ended July 1, 2023
Cost of sales	$	38,852	$	26,303	$	65,155
Gross profit	$	(38,852)	$	(26,303)	$	(65,155)
Selling, general and administrative expenses	$	(1,632)	$	2,963	$	1,331
Income (loss) from operations	$	(37,220)	$	(29,266)	$	(66,486)

As part of pushdown accounting, the Company recorded goodwill to the reporting units expected to benefit from the business combination. The goodwill is mainly attributable to costs savings in manufacturing productivity; freight and logistics; procurement; and other operating costs, as well as operational improvements in recent acquisitions to be achieved subsequent to the Merger. The goodwill recorded is not deductible for income tax purposes. The following table sets forth the allocation of goodwill by the Company’s reportable segments as of the date of the Merger:

Aperture Solutions						Surface Solutions						Shelter Solutions						Total Goodwill
$	714,394					$	681,822					$	203,111					$	1,599,327

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The Company identified intangible assets for customer lists and relationships and trademarks, trade names and other. Intangible assets are amortized on a straight-line basis over their expected useful lives. The fair value and weighted average estimated useful life of identifiable intangible assets consists of the following:

	Fair Value		Weighted Average Useful Life (in years)
Customer lists and relationships	$	1,816,000	17
Trademarks, trade names and other	620,000		15
Total	$	2,436,000

The Company incurred transaction costs of $29.4 million associated with the Merger, of which $0.7 million was recognized in the period from July 25, 2022 through December 31, 2022 and $28.7 million was recognized in the period from January 1, 2022 through July 24, 2022. These costs are included in selling, general and administrative expenses on the Condensed Consolidated Statements of (Loss) Income.

Unaudited Pro Forma Financial Information

Had the Merger occurred at the beginning of 2022, unaudited pro forma revenues and net income for the three and nine months ended September 30, 2023 and October 1, 2022 would not have been materially different than the amounts reported as the pro forma adjustments would primarily reflect the amortization of intangibles and depreciation of property, plant and equipment that received a step up in basis and the cost to finance the transaction, net of the related tax effects. The unaudited supplemental pro forma financial information would not give effect to the potential impact of current financial conditions, operating efficiencies or cost savings that may result from the Merger or any integration costs. Unaudited pro forma balances would not necessarily be indicative of operating results had the Merger occurred on January 1, 2022 or of future results.

Acquisition of M.A.C. Métal Architectural Inc.

On August 17, 2023, the Company completed the acquisition of M.A.C. Métal Architectural Inc. (“MAC Metal”), which became an indirect wholly-owned subsidiary of the Company. Headquartered in Saint-Hubert, Quebec, MAC Metal serves the North American residential and commercial markets with high-end steel siding and roofing products. MAC Metal will be included in the Company’s Surface Solutions reportable segment. The acquisition was accounted for as a business combination in accordance with Accounting Standards Codification, 805, Business Combinations (Topic 805).

The provisional purchase price was $87.1 million (CAD$118.5 million), comprised of an upfront cash payment of $70.3 million (CAD$95.6 million) and earn-out contingent consideration of $16.8 million (CAD$22.9 million). The transaction is subject to a final working capital adjustment. The earn-out is payable over two consecutive twelve-month periods, starting in the month following the close of the acquisition and payments are based upon achieving certain adjusted EBITDA-based metrics, as defined in the purchase agreement. The purchase price was provisionally allocated to the assets acquired and liabilities assumed, which related primarily to inventory of $8.6 million, property, plant and equipment of $18.8 million, goodwill of $25.2 million, intangible assets such as, customer lists and trademarks, of $27.0 and $14.4 million, contingent consideration of $16.8 million and noncurrent deferred income tax liabilities of $14.2 million. The estimated fair-value of the contingent consideration is recognized in other long-term liabilities on the Company’s Condensed Consolidated Balance Sheet.

Note 4 — Inventories

The following table sets forth the components of inventories:

	Successor
	March 30, 2024		December 31, 2023
	September 30, 2023		December 31, 2022
Raw materials	$	333,325	$	291,093
Raw materials	$	306,174	$	312,380
Work in process	65,207		59,336
Work in process	54,704		67,424
Finished goods	151,728		146,410
Finished goods	151,539		172,024
Total inventories	$	550,260	$	496,839
Total inventories	$	512,417	$	551,828

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Note 5 — Goodwill and Intangible Assets

Goodwill

The following table sets forth the changes in the carrying amount of goodwill by reportable segment:

	ApertureSolutions		SurfaceSolutions		ShelterSolutions		Total
Balance, December 31, 2022 (Successor)	$	624,009	$	790,452	$	274,087	$	1,688,548
Balance, December 31, 2023	$	771,133	$	708,423	$	202,208	$	1,681,764
Go private measurement period adjustments	87,498		(110,791)		(70,976)		(94,269)
Acquisition related measurement period adjustments(1)	(6,021)		1,660		—		(4,361)
Acquisition related measurement period adjustments ¹	—		25,234		—		25,234
Currency translation	(426)		(1,571)		—		(1,997)
Currency translation	717		(45)		—		672
Other(2)	6,375		783		2,619		9,777
Balance, September 30, 2023 (Successor)	$	712,224	$	704,850	$	203,111	$	1,620,185
Balance, March 30, 2024	$	771,061	$	709,295	$	204,827	$	1,685,183

(1) Measurement period adjustments have been recorded in conjunction with the acquisition of MAC Metal and EAS during the period. See Note 3 — ~~Mergers~~ ~~and~~ Acquisitions for additional information.

(2) Other includes insignificant out-of-period corrections totaling $9.8 million, which related to matters that existed as of the date of the merger transaction during July 2022 (the “Merger”).

Intangible Assets, Net

The following table sets forth the major components of intangible assets:

	Life (Years)			Weighted Average Amortization Period Remaining (Years)	Cost		Accumulated Amortization		Net Carrying Value
	Range of Life(in Years)			Weighted Average Amortization Period Remaining (Years)	Cost		Accumulated Amortization		Net Carrying Value
As of September 30, 2023 (Successor)
As of March 30, 2024:
Amortized intangible assets:
Customer lists and relationships	3	–	19	16	$	1,884,594	$	(234,546)	$	1,650,048
Customer lists and relationships	3	–	19	17	$	1,843,145	$	(169,452)	$	1,673,693
Trademarks, trade names and other		15		13	651,698		(69,255)		582,443
Trademarks, trade names and other		15		14	634,497		(49,430)		585,067
Total intangible assets					$	2,536,292	$	(303,801)	$	2,232,491
Total intangible assets					$	2,477,642	$	(218,882)	$	2,258,760
	Range of Life(in Years)			Weighted Average Amortization Period Remaining (Years)	Cost		Accumulated Amortization		Net Carrying Value
As of December 31, 2022 (Successor)
As of December 31, 2023:
Amortized intangible assets:
Customer lists and relationships	3	–	19	16	$	1,883,757	$	(192,473)	$	1,691,284
Customer lists and relationships		13		13	$	2,088,548	$	(73,330)	$	2,015,218
Trademarks, trade names and other		15		14	653,992		(59,208)		594,784
Trademarks, trade names and other		13		13	522,137		(18,332)		503,805
Total intangible assets					$	2,537,749	$	(251,681)	$	2,286,068
Total intangible assets					$	2,610,685	$	(91,662)	$	2,519,023

Intangible assets are amortized on a straight-line basis. The following table sets forth the amortization expense related to intangible assets:

Successor

Predecessor

Successor

Predecessor

Three Months Ended

Period fromJuly 2, 2023throughSeptember 30, 2023

Period from July 25, 2022 through October 1, 2022

Period from July 3, 2022 through July 24, 2022

Period fromJanuary 1, 2023throughSeptember 30, 2023

Period from July 25, 2022 through October 1, 2022

Period from January 1, 2022 through July 24, 2022

March 30, 2024

April 1, 2023

Amortization expense

4447,~~690~~234

3747,~~024~~904

~~12,395~~

~~126,292~~

~~37,024~~

~~109,451~~

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Note 6 — Product Warranties

The following table sets forth the changes in the carrying amount of product warranties liability:

	Successor				Predecessor
	Three Months Ended
	Period fromJanuary 1, 2023throughSeptember 30, 2023		Period from July 25, 2022 through October 1, 2022		Period from January 1, 2022 through July 24, 2022
	March 30, 2024		April 1, 2023
Balance, beginning of period ¹	$	202,463	$	203,011	$	218,356
Balance, beginning of period	$	194,235	$	202,463
Acquisitions	—		—		189
Warranties sold	—		324
Divestiture	—		—		(4,345)
Revenue recognized	—		(612)
Warranties sold	1,016		369		1,052
Expense	3,860		12,501
Revenue recognized	(1,843)		(510)		(1,383)
Claims and settlements	(4,218)		(11,292)
Expense	25,367		8,191		26,910
Reclassification of deferred warranty revenue(1)	(24,717)		—
Settlements	(27,982)		(8,374)		(21,311)
Balance, end of period	$	169,160	$	203,384
Balance, end of period	$	199,021	$	202,687	$	219,468
Reflected as:
Reflected as:
Current liabilities – Rebates, warranties and other customer-related liabilities	$	20,083	$	26,936
Current liabilities – Rebates, warranties and other customer-related liabilities	$	34,224	$	24,871	$	26,888
Noncurrent liabilities – Other long-term liabilities	149,077		176,448
Noncurrent liabilities – Other long-term liabilities	164,797		177,816		192,580
Total product warranty liability	$	169,160	$	203,384
Total product warranty liability	$	199,021	$	202,687	$	219,468

(1) Reclassification Inof ~~connection~~deferred ~~with~~warranty ~~the~~revenue ~~Merger,~~for the ~~beginning~~Shelter ~~balance~~Solutions ~~for~~reportable segment that had historically been included in the ~~Successor~~warranty ~~period~~liability ~~reflects~~disclosure. ~~acquisition-related~~Deferred ~~adjustments~~warranty revenue is recorded in other current liabilities of 16$2.5 million and other long-term liabilities of $23.2 million within our Condensed Consolidated Balance Sheets for three months ended March 30, 2024.

Note 7 — ~~Long-Term~~ Debt

The following table sets forth the components of long-term debt:

			Successor
			March 30, 2024								December 31, 2023
			September 30, 2023								December 31, 2022
	Effective Interest Rate		Principal Outstanding		Unamortized Fair Value Adjustment (1)		Unamortized Discount and Issuance Costs		Carrying Amount		Principal Outstanding		Unamortized Fair Value Adjustment(1)		Unamortized Discount and Issuance Costs		Carrying Amount
Term loan facility, due April 2028	8.57	%	$	2,~~535~~522,000	$	(~~307~~277,~~011~~774)	$	—	$	2,~~227~~244,~~989~~226	$	2,~~554~~528,500	$	(~~348~~292,~~769~~442)	$	—	$	2,~~205~~236,~~731~~058
Term loan facility, due August 2028	9.69	%	~~297~~296,~~750~~250		—		(1917,~~193~~540)		278,~~557~~710		~~300~~297,000		—		(2118,~~538~~370)		278,~~462~~630
6.125% Senior Notes, due January 2029	13.51	%	318,699		(89,985)		—		228,714		365,541		(111,524)		—		254,017
6.125% senior notes, due January 2029	13.73	%	318,699		(84,043)		—		234,656		318,699		(87,050)		—		231,649
8.750% Senior Secured Notes, due August 2028	10.61	%	710,000		—		(46,796)		663,204		710,000		—		(52,622)		657,378
8.750% senior secured notes, due August 2028	10.61	%	710,000		—		(42,671)		667,329		710,000		—		(44,787)		665,213
Total long-term debt			$	3,~~861~~846,~~449~~949	$	(~~396~~361,~~996~~817)	$	(6560,~~989~~211)	$	3,~~398~~424,~~464~~921	$	3,~~930~~854,~~041~~199	$	(~~460~~379,~~293~~492)	$	(7463,~~160~~157)	$	3,~~395~~411,~~588~~550
Reflected as:
Current liabilities - Current portion of long-term debt									$	29,000							$	29,000
Current liabilities - Current maturities of long-term debt									$	29,000							$	29,000
Non-current liabilities - Long-term debt									3,~~369~~395,~~464~~921								3,~~366~~382,~~588~~550
Total long-term debt									$	3,~~398~~424,~~464~~921							$	3,~~395~~411,~~588~~550
Fair value - Senior notes - Level 1									$	~~929~~1,~~464~~014,670							$	~~907~~988,~~993~~702
Fair value - Term loans - Level 2									2,762,958								2,580,000
Fair value - Term loans - Level 2(2)									2,810,824								2,835,596
Total fair value									$	3,~~692~~825,~~422~~494							$	3,~~487~~824,~~993~~298

(1) OnIn July ~~25,~~ 2022, as a result of the pushdown accounting related to the Merger, the carrying values of the term loan facility due April 2028 and the 6.125% ~~Senior~~senior ~~Notes~~notes ~~due January 2029 (as defined below)~~ were adjusted to fair value.

13(2) Term loans are classified within Level 2 of the fair value hierarchy because they are valued based on quoted market prices.


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~~Revolving~~Repurchase ~~Credit~~of ~~Facilities~~6.125% Senior Notes due January 2029

The ~~following~~Company ~~table~~repurchased ~~sets~~an ~~forth~~aggregate principal amount of $21.7 million of 6.125% Senior Notes for $15.5 million in cash during the three months ended April 1, 2023. The repurchases, which resulted in a write-off of associated unamortized debt discount and deferred financing costs, resulted in a loss of $0.6 million, recognized as a loss on extinguishment in the debt in the Condensed Consolidated Statements of Loss for the three months ended April 1, 2023. There were no repurchases of the Company’s ~~availability~~6.125% ~~under~~Senior ~~its~~Notes ~~credit~~during ~~facilities:~~the three months ended March 30, 2024.

	Successor
	September 30, 2023						December 31, 2022
	Available		Borrowings		Letters of Credit and Priority Payables		Available		Borrowings		Letters of Credit and Priority Payables
Asset-based lending facility	$	850,000	$	—	$	47,000	$	850,000	$	—	$	48,000
Cash flow revolver (1)	92,000		—		—		115,000		—		—
First-in-last-out tranche asset-based lending facility	95,000		—		—		95,000		—		—
Total	$	1,037,000	$	—	$	47,000	$	1,060,000	$	—	$	48,000

Short-Term Borrowings

~~(1) Cash~~The ~~flow~~following ~~revolver~~table ~~commitments~~sets offorth ~~$23.0 million~~the ~~matured~~Company’s inavailability ~~April~~under ~~2023~~its ~~and~~revolving ~~$92.0~~credit ~~million will mature in April 2026.~~facilities:

Term Loan Facility due April 2028 and Cash Flow Revolver


	March 30, 2024						December 31, 2023
	Available		Borrowings		Letters of Credit and Priority Payables		Available		Borrowings		Letters of Credit and Priority Payables
Asset-based lending facility, due July 2027(1)	$	850,000	$	5,000	$	42,000	$	850,000	$	—	$	47,000
Cash flow revolver(2)	92,000		—		—		92,000		—		—
First-in-last-out tranche asset-based lending facility, due July 2027(1)	95,000		95,000		—		95,000		—		—
Total	$	1,037,000	$	100,000	$	42,000	$	1,037,000	$	—	$	47,000

~~In April 2018, Ply Gem Midco, Inc.~~ (~~“Ply Gem Midco”~~1) As ~~entered~~of ~~into~~March ~~a Cash Flow Agreement (as amended from time to time~~30, ~~the “Cash Flow Credit Agreement”)~~2024, ~~which~~borrowings ~~provides~~on ~~for (i) a term loan facility (the “Term Loan Facility”) in the aggregate principal amount of $2,600.0 million, issued with a discount of 0.5% and (ii) a cash flow-based~~ revolving credit ~~facility~~facilities ~~(the~~are ~~“Cash~~included ~~Flow~~within ~~Revolver”)~~short-term ofborrowings upand toclassified ~~$115.0 million with $92.0 million remaining~~ as ~~of September 30, 2023. In connection with the consummation of the Ply Gem merger, the Company and Ply Gem Midco entered into~~ a ~~joinder~~current ~~agreement~~liability inon ~~which~~ the ~~Company~~Condensed ~~became~~Consolidated ~~the~~Balance ~~Borrower (as defined in the Cash Flow Credit Agreement) under the Term Loan Facility and Cash Flow Revolver (together the “Cash Flow Facilities”)~~Sheets. ~~On April 11, 2023, the Company amended the Cash Flow Credit Agreement to replace the adjusted LIBOR rate with the Secured Overnight Financing Rate (“SOFR”) rate.~~

The Term Loan Facility amortizes in nominal quarterly installments equal to one percent of the aggregate initial principal amount thereof per annum, with the remaining balance payable upon final maturity. The Term Loan Facility bears annual interest at a floating rate measured by reference to, at the Company’s option, either (i2) Cash aflow ~~Term~~revolver ~~SOFR~~commitment ~~rate with a credit spread adjustment~~ of 0$92.~~10% (subject to a floor of~~ 0~~.50%)~~ ~~plus~~million anwill ~~applicable~~mature ~~margin~~in ofApril 32026.~~25% per annum or (ii) an alternate base rate plus an applicable margin of 2.25% per annum.~~

Loans outstanding under the Cash Flow Revolver bear annual interest at a floating rate measured by reference to, at the Company’s option, either (i) a Daily Simple SOFR rate or a Term SOFR rate with (only in the case of Term SOFR rate borrowings with an interest period greater than one month) a credit spread adjustment of 0.10% (subject to a floor of 0.00%) plus an applicable margin ranging from 2.50% to 3.00% per annum depending on the Company’s secured leverage ratio or (ii) an alternate base rate plus an applicable margin ranging from 1.50% to 2.00% per annum depending on the Company’s secured leverage ratio. There are no amortization payments under the Cash Flow Revolver. Additionally, unused commitments under the Cash Flow Revolver are subject to a fee ranging from 0.25% to 0.50% per annum depending on the Company’s secured leverage ratio.

Subject to certain exceptions, the Term Loan Facility is subject to mandatory prepayments in an amount equal to:

•the net cash proceeds of (i) certain asset sales, (ii) certain debt offerings and (iii) certain insurance recovery and condemnation events; and

•50% of annual excess cash flow (as defined in the Cash Flow Credit Agreement), subject to reduction to 25% and 0% if specified secured leverage ratio targets are met to the extent that the amount of such excess cash flow exceeds $10.0 million. No payments were required in 2022 under the year 2021 excess cash flow calculation.

Both the Term Loan Facility and Cash Flow Revolver may be prepaid at the Company’s option at any time without premium or penalty (other than customary breakage costs), subject to minimum principal amount requirements.

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ABL Facility due July 2027

On April 12, 2018, Ply Gem Midco entered into an ABL Credit Agreement (as amended from time to time, the “ABL Credit Agreement”), which provides for (a) an asset-based revolving credit facility of up to $850.0 million (amended from time to time the “ABL Facility”), a portion of which is (i) available to United States (“U.S.”) borrowers and (ii) available to U.S. and Canadian borrowers. In connection with the consummation of the Ply Gem merger, the Company and Ply Gem Midco entered into a joinder agreement in which the Company became the Parent Borrower (as defined in the ABL Credit Agreement) under the ABL Facility, and (b) a first-in-last-out tranche asset-based revolving credit facility of up to $95.0 million (the “ABL FILO Facility”) available to U.S. borrowers.

Borrowing availability under the ABL Facility and the ABL FILO Facility (collectively, the “ABL Facilities”) is determined by a monthly borrowing base collateral calculation that is based on specified percentages of the value of eligible inventory, accounts receivable, less certain allowances and subject to certain other adjustments as set forth in the ABL Credit Agreement. Availability is reduced by issuance of letters of credit as well as any borrowings.

Loans outstanding under the ABL Facility bear interest at a floating rate measured by reference to, at the Company’s option, either (i) a term SOFR rate (subject to a SOFR floor of 0.00%) plus an applicable margin ranging from 1.25% to 1.75% per annum depending on the average daily excess availability under the ABL Facility or (ii) an alternate base rate plus an applicable margin ranging from 0.25% to 0.75% per annum depending on the average daily excess availability under the ABL Facility. Additionally, unused commitments under the ABL Facility are subject to a 0.25% per annum fee.

Loans outstanding under the ABL FILO Facility bear interest at a floating rate measured by reference to, at the Company’s option, either (i) a term SOFR rate (subject to a SOFR floor of 0.00%) plus an applicable margin ranging from 2.25% to 2.75% per annum depending on the average daily excess availability under the ABL FILO Facility or (ii) an alternate base rate plus an applicable margin ranging from 1.25% to 1.75% per annum depending on the average daily excess availability under the ABL FILO Facility. Additionally, unused commitments under the ABL FILO Facility are subject to a 0.25% per annum fee.

Side Car Term Loan Facility due August 2028

On July 25, 2022, the Company entered into a Term Loan Credit Agreement (as amended from time to time, the “Side Car Term Loan Credit Agreement”) which provides for a term loan facility (the “Side Car Term Loan Facility”) in an original aggregate principal amount of $300.0 million. The Side Car Term Loan Credit Agreement will mature on August 1, 2028.

Loans outstanding under the Side Car Term Loan Facility bear interest at a floating rate measured by reference to, at the Company’s option, either (i) a term SOFR rate plus 5.625% (subject to a SOFR floor of 0.50%) or (ii) an alternate base rate plus 4.625%. Borrowings under the Side Term Loan Credit Agreement amortize in equal quarterly installments in an amount equal to 1.00% per annum of the principal amount.

The Side Car Term Loan Facility may be prepaid at the Company’s option at any time, subject to certain prepayment premiums if prepaid prior to August 1, 2026.

6.125% Senior Notes due January 2029

On September 24, 2020, the Company issued $500.0 million in aggregate principal amount of 6.125% Senior Notes due January 2029 (the “6.125% Senior Notes”). The 6.125% Senior Notes bear interest at 6.125% per annum and will mature on January 15, 2029. Interest is payable semi-annually in arrears on January 15 and July 15.

The 6.125% Senior Notes are unsecured senior indebtedness and are effectively subordinated to all of the Company’s existing and future senior secured indebtedness, including indebtedness under the Term Loan Facility, the Cash Flow Revolver, the Side Car Term Loan Facility, the 8.750% Senior Secured Notes (as defined below) and the ABL Facilities, and are senior in right of payment to future subordinated indebtedness of the Company.

The Company may redeem the 6.125% Senior Notes in whole or in part at any time subject to certain prepayment premiums if the 6.125% Senior Notes were to be redeemed prior to September 15, 2025.

Repurchase of 6.125% Senior Notes

The Company repurchased an aggregate principal amount of $— and $46.8 million of 6.125% Senior Notes for $— and $33.9 million in cash during the three and nine months ended September 30, 2023. The repurchases, which resulted in a write-off of associated unamortized debt discount and deferred financing costs, resulted in a loss of $0.2 million for the nine months ended September 30, 2023.

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8.750% Senior Secured Notes due August 2028

On July 25, 2022, the Company issued $710.0 million in aggregate principal amount of 8.750% Senior Secured Notes due August 2028 (the “8.750% Senior Secured Notes”). The 8.750% Senior Secured Notes bear interest at 8.750% per annum and will mature on August 1, 2028. Interest is payable semi-annually in arrears on January 15 and July 15 of each year.

The 8.750% Senior Secured Notes are secured senior indebtedness and rank equal in right of payment with all existing and future senior indebtedness and are senior in right of payment to all existing and future subordinated indebtedness of the Company, including the 6.125% Senior Notes.

The Company may redeem the 8.750% Senior Secured Notes in whole or in part at any time subject to certain prepayment premiums if the 8.750% Senior Secured Notes were to be redeemed prior to August 1, 2026.

Other Information

The obligations under the Company’s debt agreements are generally guaranteed by each direct and indirect wholly-owned U.S. restricted subsidiary of the Company, subject to certain exceptions. In addition, the obligations of the Canadian borrowers under the ABL Facility are guaranteed by each direct and indirect wholly-owned Canadian restricted subsidiary of the Canadian borrowers, subject to certain exceptions. In addition, the obligations under the Cash Flow Credit Agreement, the ABL Credit Agreement, the Side Car Term Loan Facility and the Company’s various secured notes are guaranteed by Camelot Parent, which guarantee is non-recourse and limited to the equity interests of the Company. The obligations under the Cash Flow Credit Agreement, the ABL Credit Agreement, the Side Car Term Loan Facility and the Company’s various secured notes are also secured by a perfected security interest in substantially all tangible and intangible assets of the Company and each subsidiary guarantor and in the capital stock of the Company, subject to certain exceptions and subject to priority of security interests provided therein.

Covenant Compliance

The ABL Credit Agreement includes a minimum fixed charge coverage ratio of 1.00:1.00, which is tested only when specified availability is less than 10.0% of the lesser of (x) the then applicable borrowing base and (y) the then aggregate effective commitments under the ABL Facility, and continuing until such time as specified availability has been in excess of such threshold for a period of 20 consecutive calendar days. The Cash Flow Credit Agreement includes a financial covenant set at a maximum secured leverage ratio of 7.75:1.00, which will apply if the outstanding amount of loans and drawings under letters of credit which have not then been reimbursed exceeds a specified threshold at the end of any fiscal quarter.

The Company’s debt agreements contain a number of covenants that, among other things, limit or restrict the ability of the Company and its subsidiaries to incur additional indebtedness; make dividends and other restricted payments; incur additional liens; consolidate, merge, sell or otherwise dispose of all or substantially all assets; make investments; transfer or sell assets; enter into restrictive agreements; change the nature of the business; and enter into certain transactions with affiliates. The Company is in compliance with all of its covenants as of ~~September~~ March 30, ~~2023~~2024.

1611


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Interest Rate Swaps

The Company uses certain interest rate swaps to manage a portion of the interest rate risk on its term loans. The following table sets forth the terms of the Company’s interest rate swap agreements:

	April 2021 Swaps
Notional amount	$	1,500,000
Forecasted term loan interest payments being hedged	1-month SOFR
SOFR floor (per annum - matches floor in hedged item)	0.40%
Fixed rate paid	2.0038%
Fixed rate paid on notional amount	2.0038%
Origination date	April 17, 2023
Maturity - Fixed rate paid	April 15, 2026
Maturity date	April 15, 2026
Fair value at September 30, 2023:
Fair value at March 30, 2024 - Other assets, net	$	72,540
Other assets, net	$	97,059
Fair value at December 31, 2023 - Other assets, net	$	64,704
Other current liabilities	$	—
Level in fair value hierarchy(1)	Level 2
Fair value at December 31, 2022:
Other assets, net	$	95,361
Other current liabilities	$	7,000
Level in fair value hierarchy (1)	Level 2

(1)Interest rate swaps are based on cash flow hedge contracts that have fixed rate structures and are measured against market based SOFR yield curves. These interest rate swaps are classified within Level 2 of the fair value hierarchy because they are valued using alternative pricing sources or models that utilized market observable inputs, including current and forward interest rates.

Note 8 — Accumulated Other Comprehensive Income

The following tables set forth the change in accumulated other comprehensive income attributable to the Company by each component of accumulated other comprehensive income, net of applicable income taxes:

	Foreign Currency Translation Adjustments		Derivative Instruments		Unrecognized Gain ~~(Loss)~~ on Retirement Benefits		Total Accumulated Other Comprehensive Income
Balance, July 1, 2023 (Successor)	$	(7,269)	$	44,924	$	336	$	37,991
Balance, December 31, 2023	$	(9,553)	$	26,600	$	820	$	17,867
Activity	(62,~~059~~181)		~~(373)~~8,314		—		(6,~~432)~~133
Balance, September 30, 2023 (Successor)	$	(13,328)	$	44,551	$	336	$	31,559
Balance, March 30, 2024	$	(11,734)	$	34,914	$	820	$	24,000
Balance, July 2, 2022 (Predecessor)	$	21,259	$	54,409	$	(6,068)	$	69,600
Balance, December 31, 2022	$	(6,789)	$	40,962	$	336	$	34,509
Activity	~~115~~(963)		~~904~~(10,892)		—		1(11,~~019~~855)
Balance, July 24, 2022 (Predecessor)	$	21,374	$	55,313	$	(6,068)	$	70,619
Balance, April 1, 2023	$	(7,752)	$	30,070	$	336	$	22,654
Balance, July 25, 2022 (Successor)	$	—	$	—	$	—	$	—
Activity	(29,743)		40,988		—		11,245
Balance, October 1, 2022 (Successor)	$	(29,743)	$	40,988	$	—	$	11,245

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	Foreign Currency Translation Adjustment		Derivative Instruments		Unrecognized Gain (Loss) on Retirement Benefits		Total Accumulated Other Comprehensive Income
Balance, December 31, 2022 (Successor)	$	(6,789)	$	40,962	$	336	$	34,509
Activity	(6,539)		3,589		—		(2,950)
Balance, September 30, 2023 (Successor)	$	(13,328)	$	44,551	$	336	$	31,559
Balance, December 31, 2021 (Predecessor)	$	22,741	$	(23,407)	$	(4,946)	$	(5,612)
Activity	(1,367)		78,720		(1,122)		76,231
Balance, July 24, 2022 (Predecessor)	$	21,374	$	55,313	$	(6,068)	$	70,619
Balance, July 25, 2022 (Successor)	$	—	$	—	$	—	$	—
Activity	(29,743)		40,988		—		11,245
Balance, October 1, 2022 (Successor)	$	(29,743)	$	40,988	$	—	$	11,245

Note 9 — Share-Based Compensation

Pre-Merger ~~Transaction~~Awards

~~Prior~~In toconnection ~~July~~with ~~24,~~the Merger in July 2022, under ~~its~~which ~~long-term~~Cornerstone ~~stock~~Building ~~incentive~~Brands ~~plan,~~became ~~the~~a ~~Company~~privately ~~had~~held ~~several~~company, unvested share-based compensation ~~award~~awards ~~types,~~that ~~including~~were ~~stock~~previously ~~options,~~granted ~~restricted~~to ~~stock~~key ~~units~~employees and ~~performance~~executives ~~share unit awards (collectively, the “Pre-Merger Awards”). In connection with the Merger, outstanding vested stock option awards~~ were ~~canceled~~cancelled and converted tointo ~~the~~a contingent contractual right to receive a ~~fixed amount of~~ cash ~~equal~~payment tofrom the ~~intrinsic~~Company ~~value~~upon ofvesting. ~~the~~The ~~awards~~Company ~~and~~had ~~were paid in August 2022~~$27.6 ~~Performance~~million ~~share~~at ~~units~~December 31, ~~(“PSUs”)~~2023 ~~granted~~and to$3.0 ~~certain~~million ~~key,~~at ~~non-executive employees in~~ March 30, ~~2021~~2024 ~~were~~classified ~~paid~~as ina ~~cash~~current inliability ~~September~~within ~~2022~~employee-related ~~with~~liabilities ~~the~~on ~~applicable~~its ~~total~~Condensed ~~shareholder~~Consolidated ~~return~~Balance ~~metric~~Sheets. ~~determined~~The ~~using~~Company apaid ~~per~~out ~~share~~$24.7 ~~price~~million ~~equal~~of cash to ~~the~~settle Pre-Merger ~~Consideration~~Awards ~~and~~in ~~the~~March ~~EBITDA-based metric determined based on target performance~~2024.

~~Resulting~~The ~~from~~Company ~~the~~recognized ~~Merger,~~$1.5 ~~unvested~~million ~~restricted~~as ~~stock~~expense ~~units~~in ~~were~~the ~~cancelled~~three ~~and~~months ~~converted~~ended ~~into~~March 30, a2024 ~~contingent~~and ~~contractual right to receive~~ a ~~payment~~gain inof ~~cash~~$4.8 million ~~equal~~for to the ~~Merger~~three ~~consideration~~months ~~per~~ended ~~award~~April ~~and~~1, ~~unvested~~2023. ~~stock~~These ~~options~~amounts ~~were~~are ~~cancelled~~included ~~and~~in ~~converted~~selling, ~~into~~general aand ~~contingent~~administrative ~~contractual~~expense ~~right~~on tothe ~~receive~~Condensed aConsolidated ~~payment~~Statements inof ~~cash~~Loss. ~~equal~~The togain during the ~~intrinsic~~three ~~value~~months ofended ~~the~~April ~~awards~~1, ~~subject~~2023 toresulted from the ~~same~~Company updating its vesting ~~conditions~~expectations asfor ~~the~~certain ~~original~~performance ~~awards.~~share units.

Resulting from the Merger, unvested PSUs that were granted to key employees and executives in March 2020 and to executives in March 2021 were cancelled and converted into a contingent contractual right to receive a cash payment from the Company equal to the product of the number of PSUs earned under the terms of the applicable award agreement, with the applicable total stockholder return metric determined using a per share price equal to the Merger consideration and the EBITDA-based metric determined based on actual performance as of the end of the three-year performance period applicable to such PSUs. PSUs granted in March 2020 vested and were paid out in cash during the three months ended April 1, 2023. PSUs granted in March 2021 to executives are expected to be paid out in cash in the first quarter of 2024. The Pre-Merger Awards are accounted for under ASC Topic 710.12

As of September 30, 2023, the Company has liabilities of $18.2 million and $0.5 million classified within employee-related liabilities and other long-term liabilities on its Condensed Consolidated Balance Sheet related to the Pre-Merger Awards that will be settled in cash. For the nine months ended September 30, 2023, the Company paid out $92.2 million of cash to settle Pre-Merger Awards, which mainly related to those PSUs granted in March 2020 and vested in March 2023.

Incentive Units

Beginning in the fourth quarter of 2022, pursuant to an incentive unit grant agreement, certain participants were granted incentive units in Camelot Return Ultimate, L.P. (the “Partnership”). The incentive units provide the holder with the opportunity to receive, upon certain vesting events and subject to Partnership repurchase rights and conditions, a return based upon the appreciation of the Partnership’s equity value from the date of grant. The incentive units vest over a five-year period on a straight-line basis. For the nine months ended September 30, 2023, 130 thousand incentive units were granted at an average grant date fair value of $49.76 per incentive unit.


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~~Compensation~~Incentive ~~Expense~~Unit Awards

Beginning in the fourth quarter of 2022, pursuant to an incentive unit grant agreement, certain participants were granted incentive units in Camelot Return Ultimate, LP (the “Partnership”). The incentive units provide the holder with the opportunity to receive, upon certain vesting events and subject to Partnership repurchase rights and conditions, a return based upon the appreciation of the Partnership’s equity value from the date of grant. The incentive units vest over a five-year period on a straight-line basis. For the three months ended ~~September~~ March 30, ~~2023~~2024, 24,010 incentive units were granted at an average grant date fair value of $46.71 per incentive unit. For the three months ended March 30, 2024, the Company recognized $1.~~9 million and $2.~~6 million of expense from incentive units and ~~Pre~~the Company estimates that the unrecognized expense is expected to be recognized over a weighted-~~Merger~~average ~~Awards~~period of 3.6 ~~For~~years totaling $29.5 million. During the ~~nine~~three months ended ~~September 30~~April 1, 2023, the Company recognized $62.~~9 million~~5 ~~and $1.1~~ million of expense ~~from~~related to incentive units ~~and Pre-Merger Awards~~.

AsNote of10 ~~September 30,~~— ~~2023,~~Equity the Company estimates that unrecognized expense is expected to be recognized over a weighted-average period of 3.2 years totaling $40.9 million, of which $32.7 million relates to incentive units and $8.1 million relates to Pre-Merger Awards.Transactions

~~Note 10 — Income Taxes~~Dividend

~~For~~In January 2024, the ~~Predecessor~~Board of Directors approved the payment of a dividend on our common stock in the aggregate amount of $231.6 million, which was received by our direct parent Camelot Return Intermediate Holdings, LLC, (“Camelot Parent”), and ~~Successor~~further ~~periods~~distributed to Camelot Return Parent, LLC (“Camelot Return Parent”), an indirect parent of the Company’s. ~~effective~~Camelot ~~tax~~Return ~~rate~~Parent ~~includes~~used ~~state~~the ~~income~~funds ~~taxes~~received to redeem all 1,950,000 ~~foreign~~preferred ~~tax~~units ~~rate~~of ~~differentials~~Camelot ~~and~~Return ~~changes~~Parent inheld ~~the~~by ~~valuation~~CD&R ~~allowance~~Pisces Holdings, L.P.

~~The~~Note ~~following~~11 ~~table~~— ~~sets~~Income ~~forth the effective tax rate for the three and nine month periods ended September 30, 2023 and October 1, 2022:~~Taxes

	Successor				Predecessor		Successor				Predecessor
	Period from July 2, 2023 through September 30, 2023		Period from July 25, 2022 through October 1, 2022		Period from July 3, 2022 through July 24, 2022		Period from January 1, 2023 through September 30, 2023		Period from July 25, 2022 through October 1, 2022		Period from January 1, 2022 through July 24, 2022
Effective tax rate	24.5	%	27.3	%	(265.6)	%	27.6	%	27.3	%	25.5	%

The Company’s effective tax rate includes state income taxes, foreign tax rate differentials and changes in the valuation allowance. The following table sets forth the effective tax rate for the three months ended March 30, 2024 and three months ended April 1, 2023:

Note 11 — Reportable Segment and Geographical Information


	Three Months Ended
	March 30, 2024		April 1, 2023
Effective tax rate	(14.9)	%	23.0	%

The ~~Company~~change isin ~~organized~~the ineffective tax rate for the three ~~reportable~~months ~~segments:~~ended ~~Aperture~~March ~~Solutions~~30, ~~Surface~~2024 ~~Solutions~~compared ~~and~~to ~~Shelter~~the ~~Solutions~~three months ended April 1, ~~which~~2023 ~~operate~~is ~~principally~~due into the ~~U.S.~~change ~~with~~in ~~limited~~state ~~operations~~tax inexpense ~~Canada~~period over period.

Note 12 — Reportable Segment and Geographical Information

Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”) for purposes of allocating resources and evaluating financial performance. Our CODM, the Chief Executive Officer, reviews financial information presented on a consolidated basis, accompanied by information about our five operating segments, for the purposes of allocating resources and evaluating financial performance. The Company is organized into three reportable segments: Aperture Solutions, Surface Solutions and Shelter Solutions, which operate principally in the U.S. with limited operations in Canada.

•The Aperture Solutions reportable segment offers a broad line of windows and doors at multiple price-points for residential new construction and repair and remodel end markets in the U.S. and Canada. Its main products include vinyl, aluminum, wood-composite and aluminum clad-wood windows and patio doors, as well as steel, wood-composite and fiberglass entry doors.

•The Surface Solutions reportable segment offers a broad suite of surface solutions products and accessories at multiple price-points for the residential new construction and repair and remodel end markets as well as stone installation services. Its main products include vinyl siding and accessories, cellular polyvinyl chloride trim, vinyl fencing and railing, stone veneer and gutter protection products.

•The Shelter Solutions reportable segment designs, engineers, manufactures and distributes extensive lines of metal products for the low-rise commercial construction market under multiple brand names and through a nationwide network of manufacturing plants and distribution centers. The Company defines low-rise commercial construction as building applications of up to five stories.

Management monitors the ~~operations~~operational results of its reportable segments separately for purposes of making decisions about resources and evaluating performance. Management evaluates performance on the basis of segment earnings before interest, income taxes, depreciation and amortization (“Adjusted reportable segment EBITDA”).

Corporate operating expenses are not allocated to reportable segments. Corporate and Other consists specifically of corporate operating expenses that are generally not allocated to reportable segments, related-party management fees, and other items that are not assigned or allocated to reportable segments. Any intercompany revenues or expenses are eliminated in consolidation.13


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Corporate operating expenses are not allocated to reportable segments. Corporate and Other consists specifically of corporate operating expenses that are generally not allocated to reportable segments, related-party management fees and other items that are not assigned or allocated to reportable segments. Any intercompany revenues or expenses are eliminated in consolidation.

The following table sets forth net sales, Adjusted reportable segment EBITDA and a reconciliation to income before income taxes:

			Successor						Predecessor		Successor				Predecessor
	Three Months Ended
			Period from July 2, 2023 through September 30, 2023				Period from July 25, 2022 through October 1, 2022		Period from July 3, 2022 through July 24, 2022		Period from January 1, 2023 through September 30, 2023		Period from July 25, 2022 through October 1, 2022		Period from January 1, 2022 through July 24, 2022
	March 30, 2024				April 1, 2023
Net sales:
Aperture Solutions	$	529,840	$	~~637,669~~	$	604,569	$	~~569,994~~	$	~~164,039~~	$	~~1,889,913~~	$	~~569,994~~	$	~~1,643,619~~
Surface Solutions	274,336		~~357,400~~		268,591		~~288,080~~		~~85,034~~		~~961,513~~		~~288,080~~		~~839,130~~
Shelter Solutions	341,511		~~429,689~~		405,928		~~416,809~~		~~116,372~~		~~1,280,638~~		~~416,809~~		~~1,253,335~~
Total net sales	$	1,145,687	$	~~1,424,758~~	$	1,279,088	$	~~1,274,883~~	$	~~365,445~~	$	~~4,132,064~~	$	~~1,274,883~~	$	~~3,736,084~~
Adjusted reportable segment EBITDA:
Aperture Solutions	$	44,880	$	~~91,946~~	$	64,793	$	~~74,235~~	$	~~15,045~~	$	~~260,032~~	$	~~74,235~~	$	~~202,682~~
Surface Solutions	43,235		~~79,205~~		26,307		~~32,978~~		~~8,576~~		~~167,011~~		~~32,978~~		~~143,880~~
Shelter Solutions	56,077		~~79,002~~		83,414		~~70,736~~		~~21,219~~		~~268,386~~		~~70,736~~		~~209,156~~
Total Adjusted reportable segment EBITDA			250,153				177,949		44,840		695,429		177,949		555,718
Total adjusted reportable segment EBITDA	144,192				174,514
Corporate and other			(62,534)				(74,654)		(39,216)		(165,095)		(74,654)		331,996
Corporate and Other	(57,164)				(47,792)
Depreciation and amortization	(94,317)		~~(93,253)~~		(72,662)		~~(56,260)~~		~~(18,289)~~		~~(331,077)~~		~~(56,260)~~		~~(166,177)~~
Interest expense	(94,820)		~~(91,013)~~		(94,111)		~~(65,813)~~		~~(11,401)~~		~~(277,438)~~		~~(65,813)~~		~~(101,078)~~
Foreign exchange (loss) gain	(4,013)		~~(3,753)~~		2,017		~~12,489~~		~~(454)~~		~~2,694~~		~~12,489~~		~~686~~
Gain (loss) on extinguishment of debt			—				—		24,801		(184)		—		28,354
Loss on extinguishment of debt	—				(563)
Other income, net	2,883		~~4,027~~		1,173		~~172~~		~~114~~		~~8,832~~		~~172~~		~~101~~
Income (loss) before income taxes			$	3,627			$	(6,117)	$	395	$	(66,839)	$	(6,117)	$	649,600
Loss before income taxes	$	(103,239)			$	(37,424)

The following table sets forth net sales disaggregated by reportable segment:

			Successor						Predecessor		Successor				Predecessor
	Three Months Ended
			Period from July 2, 2023 through September 30, 2023				Period from July 25, 2022 through October 1, 2022		Period from July 3, 2022 through July 24, 2022		Period from January 1, 2023 through September 30, 2023		Period from July 25, 2022 through October 1, 2022		Period from January 1, 2022 through July 24, 2022
	March 30, 2024				April 1, 2023
Aperture Solutions:
Vinyl windows	$	508,438	$	~~605,259~~	$	567,193	$	~~538,447~~	$	~~153,296~~	$	~~1,794,514~~	$	~~538,447~~	$	~~1,542,525~~
Aluminum windows and other	21,402		~~32,410~~		37,376		~~31,547~~		$	~~10,743~~	~~95,399~~		~~31,547~~		~~101,094~~
Total	$	529,840	$	~~637,669~~	$	604,569	$	~~569,994~~	$	~~164,039~~	$	~~1,889,913~~	$	~~569,994~~	$	~~1,643,619~~
Surface Solutions:
Vinyl siding	$	134,464	$	~~176,957~~	$	132,185	$	~~139,459~~	$	~~43,318~~	$	~~471,983~~	$	~~139,459~~	$	~~415,534~~
Metal siding	76,017		~~95,348~~		60,437		~~64,855~~		~~19,112~~		~~241,851~~		~~64,855~~		~~185,097~~
Injection molded siding	11,696		~~16,561~~		12,486		~~12,405~~		~~3,650~~		~~44,603~~		~~12,405~~		~~41,841~~
Stone	14,122		~~19,098~~		18,019		~~20,933~~		~~4,947~~		~~56,567~~		~~20,933~~		~~51,904~~
Stone veneer installation and other	38,037		~~49,436~~		45,464		~~50,428~~		~~14,007~~		~~146,509~~		~~50,428~~		~~144,754~~
Total	$	274,336	$	~~357,400~~	$	268,591	$	~~288,080~~	$	~~85,034~~	$	~~961,513~~	$	~~288,080~~	$	~~839,130~~
Shelter Solutions:
Metal building products	$	341,511	$	~~429,689~~	$	405,928	$	~~416,809~~	$	~~116,372~~	$	~~1,280,638~~	$	~~416,809~~	$	~~1,140,259~~
Metal coil coating			—				—		—		—		—		113,076
Total	$	341,511			$	405,928
Total			$	429,689			$	416,809	$	116,372	$	1,280,638	$	416,809	$	1,253,335
Total net sales	$	1,145,687			$	1,279,088
Total net sales			$	1,424,758			$	1,274,883	$	365,445	$	4,132,064	$	1,274,883	$	3,736,084

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The following table sets forth total assets disaggregated by reportable segment:

	Successor
	March 30, 2024		December 31, 2023
	September 30, 2023		December 31, 2022
Total assets:
Aperture Solutions	$	2,~~856~~944,~~935~~230	$	2,~~153~~934,~~378~~102
Surface Solutions	2,~~267~~256,~~523~~756		2,~~099~~268,~~244~~443
Shelter Solutions	1,~~154~~132,~~697~~731		~~973~~1,~~718~~111,679
Corporate	~~694~~290,~~416~~986		1619,~~967,310~~117
Total assets	$	6,~~973~~624,~~571~~703	$	76,~~193~~933,~~650~~341

Note 1213 — Commitments and Contingencies

As a manufacturer of products primarily for use in building construction, the Company is inherently exposed to various types of contingent claims, both asserted and unasserted, in the ordinary course of business. As a result, from time to time, the Company may become involved in various legal proceedings or other contingent matters arising from claims or potential claims arising out of its operations and businesses that cover a wide range of matters, including, among others, environmental, contract, employment, including applicable ~~benefits~~benefit and pension plans, intellectual property, securities, personal injury, property damage, product liability, warranty, and modification, adjustment or replacement of component parts or units sold, which may include product recalls. The Company insures (or self-insures) against these risks to the extent deemed prudent by its management and to the extent insurance is available. Management believes that the ultimate disposition of these matters will not have a material adverse effect on the Company’s results of operations, financial position or cash flows. However, such matters are subject to many uncertainties and outcomes and are not predictable with assurance.

Environmental

The Company’s operations are subject to various federal, state, local and foreign environmental, health and safety laws. Among other things, these laws regulate the emissions or discharge of contaminants into the environment; govern the use, storage, treatment, disposal and management of hazardous substances and wastes; protect employee health and safety, public health and welfare and the end-users of its products; regulate the chemicals used in its products; and impose liability for the costs of investigating and remediating (as well as other damages resulting from) present and past releases of hazardous substances. Violations of these laws or of any conditions contained in environmental permits could impact the Company's current and future operations.

The Company believes it is in material compliance with all applicable laws and regulations and has recorded a liability of $8.8 5 million atas ~~September~~ of March 30, ~~2023~~2024 and $8.8 million as of December 31, ~~2022~~2023 for certain subsurface investigation and remedial matters.

Litigation

The Company is a party to a variety of legal actions arising out of the normal course of business. Plaintiffs occasionally seek punitive or exemplary damages. The Company is also included in other kinds of legal actions, some of which assert or may assert claims or seek to impose fines or penalties and other costs in substantial amounts and are described below.

Stockholder Litigation

In July 2022, and pursuant to an Agreement and Plan of Merger dated March 5, 2022, Clayton, Dubilier and Rice, LLC (“CD&R”) became the indirect owner of Cornerstone Building Brands. In January 2023, purported former stockholders filed two separate complaints challenging the fairness of the ~~CD&R~~ Merger. The complaints are captioned Firefighters’ Pension System of the City of Kansas City, Missouri Trust and Gary D. Voigt v. Affeldt et al., C.A. No. 2023-0091-JTL (Del. Ch.) and Whitebark Value Partners LP and Robert Garfield v. Clayton Dubilier & Rice, LLC et al., C.A. No. 2023-0092-JTL (Del. Ch.). In both complaints, the plaintiffs allege that CD&R and its affiliates controlled the Company prior to the transaction and that certain directors and officers of the Company, as well as CD&R and its affiliates, breached their fiduciary duties and engaged in conduct resulting in a sale of the Cornerstone Building Brands public stockholders’ shares to CD&R at an unfair price. The plaintiffs seek unspecified monetary damages, attorneys’ fees, expenses, and costs. The court consolidated the two cases, and on May 3, 2023, selected Whitebark Value Partners LP as lead plaintiff. ~~The~~ ~~Company does not believe these claims have merit and intend to vigorously defend against them.~~ On July 14, 2023, the defendants moved to dismiss the operative complaint. ~~Oral~~The ~~argument on the~~ motion to dismiss iswas ~~scheduled~~denied ~~for~~on January 10, 2024. The Company intends to vigorously defend against these claims. The Company cannot predict with any degree of certainty the outcome of these matters or determine the extent of any potential liabilities. The Company also cannot provide an estimate of the possible loss or range of loss. ~~The Company does not believe, based on currently available information, that the outcome of these proceedings will have a material adverse effect on its financial condition.~~

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In June 2023, a purported former stockholder filed a class action complaint in the United States District Court for the District of Delaware alleging that the Company’s disclosures issued in connection with the ~~CD&R~~ Merger were materially misleading in violation of Section 14(a) and Section 20(a) of the Securities Exchange Act of 1934. The complaint is captioned Water Island Merger Arbitrage Institutional Commingled Master Fund, L.P. v. Cornerstone Building Brands et al., Case No. 1:23-cv-00701 (D. Del.). The complaint alleges that the Company’s directors and officers issued misleading disclosures, which caused stockholders to approve the ~~CD&R~~ Merger at an unfair price. The plaintiff seeks unspecified monetary damages, interest, attorneys’ fees, expenses, and costs. ~~The~~On ~~Company~~December ~~does~~8, ~~not~~2023, ~~believe~~the ~~these~~defendants ~~claims~~moved ~~have~~to ~~merit~~dismiss the operative complaint, and, ~~intend~~in the alternative, to stay the litigation. The Company intends to vigorously defend against ~~them~~these claims. The Company cannot predict with any degree of certainty the outcome of this matter or determine the extent of any potential liabilities. The Company also cannot provide an estimate of the possible loss or range of loss. The Company does not believe, based on currently available information, that the outcome of these proceedings will have a material adverse effect on its financial condition.

Note 13 — Earnings Per Common Share

Basic earnings per common share is computed by dividing net income allocated to common shares by the weighted average number of common shares outstanding. Diluted income per common share, if applicable, considers the dilutive effect of common stock equivalents. The reconciliation of the numerator and denominator used for the computation of basic and diluted earnings per common share is as follows:

	Predecessor
	Period from July 3, 2022 through July 24, 2022		Period from January 1, 2022 through July 24, 2022
Numerator for Basic and Diluted Earnings Per Common Share
Net income applicable to common shares	$	1,433	$	480,211
Denominator for Basic and Diluted Earnings Per Common Share:
Weighted average basic number of common shares outstanding	127,544		127,316
Common stock equivalents:
Employee stock options	1,583		1,578
Weighted average diluted number of common shares outstanding	129,127		128,894
Basic earnings per common share	$	0.01	$	3.77
Diluted earnings per common share	$	0.01	$	3.73
Incentive plan securities excluded from dilution (1)	—		30

(1)Represents securities not included in the computation of diluted earnings per common share because their effect would have been anti-dilutive.

The Company calculates earnings per share using the “two-class” method, whereby unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents are “participating securities” and, therefore, these participating securities are treated as a separate class in computing earnings per share. The calculation of earnings per share presented here excludes the income attributable to unvested restricted stock units related to our Incentive Plan from the numerator and excludes the dilutive impact of those shares from the denominator. Awards subject to the achievement of performance conditions or market conditions for which such conditions had been met at the end of any of the periods presented are included in the computation of diluted earnings per common share if their effect was dilutive.

Earnings per common share is not presented for the Successor period as the Company’s common stock is no longer publicly traded either on a stock exchange or in the over-the-counter market.

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Note 14 — Supplemental Cash Flow Information

The following table sets forth supplemental cash flow information:

	Successor				Predecessor
	Three Months Ended
	Period fromJanuary 1, 2023throughSeptember 30, 2023		Period fromJuly 25, 2022throughOctober 1, 2022		Period fromJanuary 1, 2022throughJuly 24, 2022
	March 30, 2024		April 1, 2023
Supplemental cash flow information:
Interest paid, net of amounts capitalized	$	235,065	$	27,482	$	103,074
Interest paid	$	92,289	$	89,062
Income taxes paid	$	33,523	$	108,962	$	56,243
Income taxes (refunded) paid	$	(4,223)	$	1,521
Supplemental non-cash investing and financing activities-
Pushdown fair value adjustments	$	—	$	1,522,432	$	—

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CORNERSTONE BUILDING BRANDS, INC.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following is management’s discussion and analysis of certain significant factors that have affected our consolidated financial condition and results of operations during the periods presented (the “MD&A”). This information should be read in conjunction with the Condensed Consolidated Financial Statements included herein “Item 1. Condensed Consolidated Financial Statements” and the Condensed Consolidated Financial Statements and the Notes thereto and “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2022~~2023 (the “~~2022~~2023 Form 10-K”).

Forward-Looking Statements

This Quarterly Report on Form 10-Q includes statements concerning our expectations, beliefs, plans, objectives, goals, strategies, future events or performance and underlying assumptions and other statements that are not historical facts. These statements are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those expressed or implied by these statements. In some cases, our forward-looking statements can be identified by the words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “goal,” “intend,” “may,” “objective,” “plan,” “potential,” “predict,” “projection,” “should,” “will,” “target” or other similar words. We have based our forward-looking statements on our management’s beliefs and assumptions based on information available to our management at the time the statements are made. We caution you that assumptions, beliefs, expectations, intentions and projections about future events may and often do vary materially from actual results. Therefore, we cannot assure you that actual results will not differ materially from those expressed or implied by our forward-looking statements. Accordingly, investors are cautioned not to place undue reliance on any forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, these expectations and the related statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those projected. These risks, uncertainties and other factors include, but are not limited to:

•~~seasonality~~Challenging ofmacroeconomic conditions affecting the ~~business~~residential, commercial and ~~adverse~~repair ~~weather~~and ~~conditions~~remodeling construction industry and markets, including increasing interest rates and demand in new construction and repair and remodeling;

•~~challenging~~Commodity ~~macroeconomic~~price ~~conditions~~volatility ~~affecting~~or ~~the~~limited ~~residential,~~availability ~~commercial~~of ~~and~~raw ~~repair~~materials, ~~and~~including ~~remodeling construction industry and markets~~steel, ~~including~~polyvinyl ~~increasing~~chloride ~~interest~~(“PVC”) ~~rates~~resin, aluminum and ~~demand~~glass indue ~~new~~to ~~construction~~supply ~~and~~chain ~~repair and remodeling~~disruptions;

•~~commodity~~Increases ~~price~~in ~~volatility~~the ~~and/or~~macroeconomic ~~limited~~inflationary ~~availability~~environment ~~of raw materials, including steel, polyvinyl chloride (“PVC”) resin, aluminum,~~ and ~~glass~~our ~~due~~ability to ~~supply~~react ~~chain disruptions~~accordingly;

•~~increases~~Our ability to identify and develop relationships with a sufficient number of qualified suppliers to mitigate risk in the ~~macroeconomic~~event ~~inflationary~~a ~~environment~~significant ~~and~~supplier ~~our~~experiences ~~ability~~a tosignificant ~~react~~production ~~accordingly~~or supply chain interruption;

•~~our~~Seasonality ~~ability to identify and develop relationships with a sufficient number~~ of ~~qualified suppliers to mitigate risk in~~ the ~~event~~business aand ~~significant~~adverse ~~supplier~~weather ~~experiences a significant production or supply chain interruption~~conditions;

•~~the~~The increasing difficulty of consumers and builders in obtaining credit or financing;

•~~our~~Our ability to successfully implement operational efficiency initiatives, including to increase automation and mitigate increases in our manufacturing costs;

•~~our~~Our ability to successfully achieve price increases to offset cost increases;

•~~ability~~Ability to compete effectively against competitors;

•~~our~~Our ability to successfully integrate our acquired businesses and to realize anticipated benefits;

•~~our~~Our ability to employ, train and retain qualified personnel;

•~~increases~~Increases in labor costs, labor market pressures, potential labor disputes, union organizing activity and work stoppages at our facilities or the facilities of our suppliers;

•~~increases~~Increases in energy costs;

•~~increases~~Increases in freight and transportation costs;

•~~volatility~~Volatility in the United States (“U.S.”) and international economies and in the credit markets;

•~~the~~An ~~severity,~~impairment ~~duration and spread~~ of ~~the~~our ~~COVID-19~~goodwill ~~pandemic and its variants (collectively, the “COVID-19 pandemic”), as well as actions that may be taken by the Company~~ or ~~governmental~~intangible ~~authorities due to any resurgence of the COVID-19 pandemic or to treat its impact and the resulting impact on supply chain and labor pressures~~assets;

•anOur ~~impairment~~ability ofto ~~our~~successfully ~~goodwill~~develop ~~and/~~new products or ~~intangible~~improve ~~assets~~existing products;

•~~our~~Enforcement ~~ability~~and toobsolescence ~~successfully~~of ~~develop~~our ~~new~~intellectual ~~products~~property ~~or improve existing products~~rights;

•~~enforcement~~Costs ~~and~~related ~~obsolescence~~to compliance with, violations of ~~our~~or ~~intellectual~~liabilities ~~property~~under ~~rights~~environmental, health and safety laws;

24•Our ability to make strategic acquisitions accretive to earnings and dispositions at favorable prices and terms;

•Our ability to fund operations, provide increased working capital necessary to support our strategy and acquisitions using available liquidity;


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•~~costs~~Global ~~related~~climate tochange and compliance with, ~~violations~~new ofor changed laws or ~~liabilities~~regulations ~~under~~relating to environmental, ~~health~~social and ~~safety laws~~governance;

•~~our~~Breaches ~~ability~~of toour ~~make~~information ~~strategic~~system ~~acquisitions~~security ~~accretive to earnings and dispositions at favorable prices and terms~~measures;

•Damage to our ~~ability~~computer toinfrastructure ~~fund~~and ~~operations~~software systems, ~~provide~~as ~~increased~~well ~~working~~as ~~capital~~issues ~~necessary~~relating to ~~support~~the ~~our~~incorporation ~~strategy~~of ~~and~~artificial ~~acquisitions~~intelligence ~~using~~solutions ~~available~~into ~~liquidity~~our systems;

•~~global~~Necessary ~~climate~~maintenance ~~change, and compliance with new~~ or ~~changed~~replacements ~~laws or regulations relating~~ to ~~environmental,~~our ~~social~~enterprise ~~and~~resource ~~governance~~planning ~~(“ESG”)~~technologies;

•~~breaches~~Potential personal injury, property damage or product liability claims or other types of ~~our~~litigation, ~~information~~including ~~system~~stockholder ~~security~~litigation ~~measures;~~related to the Merger;

•~~damage~~Compliance towith ~~our~~certain ~~computer~~laws ~~infrastructure~~related ~~and~~to ~~software~~our ~~systems~~international business operations;

•~~necessary~~Significant ~~maintenance~~changes orin ~~replacements~~factors and assumptions used to measure certain of our ~~enterprise~~defined ~~resource~~benefit ~~planning~~plan ~~technologies~~obligations and the effect of actual investment returns on pension assets;

•~~potential~~Additional ~~personal~~costs ~~injury,~~from ~~property~~new ~~damage~~regulations orwhich ~~product~~relate ~~liability~~to ~~claims~~the utilization or ~~other~~manufacturing ~~types~~ of ~~litigation,~~our ~~including~~products ~~stockholder~~or ~~litigation~~services, ~~related~~including tochanges ~~the~~in ~~Merger~~building ~~(as~~codes ~~defined~~and ~~herein)~~standards;

•~~compliance~~Increases ~~with~~in ~~certain~~tariffs ~~laws~~or ~~related~~import toand ~~our~~trade ~~international business operations~~restrictions;

•~~significant~~Our ~~changes~~controlling instockholder’s ~~factors~~interests ~~and~~differing ~~assumptions~~from ~~used~~the tointerests ~~measure~~of ~~certain~~holders of our ~~defined benefit plan obligations and the effect of actual investment returns on pension assets~~indebtedness;

•~~additional~~Our ~~costs~~substantial ~~from~~indebtedness ~~new~~and ~~regulations~~our ~~which~~ability ~~relate~~ to ~~the~~incur ~~utilization~~substantially ormore ~~manufacturing of our products or services, including changes in building codes and standards~~indebtedness;

•~~increases~~Limitations inthat ~~tariffs~~our ordebt ~~import~~agreements place on our ability to engage in certain business and ~~trade~~financial ~~restrictions~~transactions;

•~~our~~Our ~~controlling~~ability ~~stockholder’s~~to ~~interests~~obtain ~~differing~~financing ~~from~~on ~~the~~acceptable ~~interests of holders of our indebtedness~~terms;

•~~our~~Exchange ~~substantial~~rate ~~indebtedness and our ability to incur substantially more indebtedness~~fluctuations;

•~~limitations~~Downgrades ~~that~~of our ~~debt~~credit ~~agreements place on our ability to engage in certain business and financial transactions~~ratings;

•~~our~~The ~~ability~~effect toof ~~obtain~~increased ~~financing~~interest rates on ~~acceptable~~our ~~terms~~ability to service our debt; and

•~~exchange~~Other ~~rate~~risks ~~fluctuations;~~detailed under the caption “Risk Factors” in this Quarterly Report on Form 10-Q, in Part I, Item 1A in the 2023 Form 10-K and other filings we make with the Securities Exchange Commission.

~~•downgrades~~A forward-looking statement may include a statement of the assumptions or bases underlying the forward-looking statement. We believe that we have chosen these assumptions or bases in good faith and that they are reasonable. However, we caution you that assumed facts or bases almost always vary from actual results and the differences between assumed facts or bases and actual results can be material, depending on the circumstances. When considering forward-looking statements, you should keep in mind the risk factors and other cautionary statements in this report, including those described under the caption “Risk Factors” in Item 1A in this Quarterly Report on Form 10-Q in Part I, Item 1A in the 2023 Form 10-K and other filings we make with the Securities and Exchange Commission. We expressly disclaim any obligations to release publicly any updates or revisions to these forward-looking statements to reflect any changes in our ~~credit~~expectations ~~ratings;~~unless the securities laws require us to do so.

•the effect of increased interest rates on our ability to service our debt;

•uncertainty as to the acceptance of Secured Overnight Financing Rate (“SOFR”) and phasing out of London Interbank Offered Rate (“LIBOR”) interest rates; and

•other risks detailed under the caption “Risk Factors” in this Quarterly Report on Form 10-Q, in Part I, Item 1A in the 2022 Form 10-K, and other filings we make with the SEC.

A forward-looking statement may include a statement of the assumptions or bases underlying the forward-looking statement. We believe that we have chosen these assumptions or bases in good faith and that they are reasonable. However, we caution you that assumed facts or bases almost always vary from actual results, and the differences between assumed facts or bases and actual results can be material, depending on the circumstances. When considering forward-looking statements, you should keep in mind the risk factors and other cautionary statements in this report, including those described under the caption “Risk Factors” in this report and the 2022 Form 10-K, and other risks described in documents subsequently filed by the Company from time to time with the SEC. We expressly disclaim any obligations to release publicly any updates or revisions to these forward-looking statements to reflect any changes in our expectations unless the securities laws require us to do so.

Company Overview

Our Company

Cornerstone Building Brands, Inc. (“Cornerstone Building Brands”, together with its subsidiaries, unless the context requires otherwise, the “Company,” “we,” “us” or “our”) is a holding company incorporated in Delaware. We are ~~the~~a ~~largest~~leading manufacturer of exterior building products in North America by sales and serve residential and commercial customers across both the new construction and repair and remodel markets.

Our operations are organized as three reportable segments: Aperture Solutions, Surface Solutions and Shelter Solutions. We have:

•One of the broadest product offerings ~~and the most well-regarded brand portfolio~~ in our industry. Our total addressable market is diverse and expands across multiple geographies, end markets, channels, ~~customers~~ and ~~products~~customers providing us with significant benefits.

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•A leading market position in various North American markets we serve, including, among others, vinyl windows, vinyl siding, stone veneer installations, metal accessories, metal roofing and wall systems and engineered metal building systems.

•An extensive coast-to-coast network of manufacturing, distribution and branch office facilities throughout North America.

•A vertically integrated manufacturing process that enables us to deliver better service and positions us to be a cost-advantaged manufacturer.

We are mindful of the harmful effects of global climate change and the contributions to climate change from manufacturing operations and the end-use of building construction products. We have made and continue to make progress on our work related to ESG matters. 18

Merger Transaction

On July 25, 2022 and pursuant to an Agreement and Plan of Merger dated March 5, 2022 (the “Merger Agreement”) by and among the Company, Camelot Return Intermediate Holdings, LLC (“Camelot Parent”), and Camelot Return Merger Sub, Inc. (“Merger Sub”), investment funds managed by Clayton, Dubilier and Rice, LLC (“CD&R”) became the indirect owners of all the issued and outstanding shares of common stock of Cornerstone Building Brands. Pursuant to the Merger Agreement, Merger Sub merged with and into the Company (the “Merger”), with the Company surviving the Merger as a subsidiary of Camelot Parent (the “Surviving Corporation”). At the effective time of the Merger (the “Effective Time”), we became a privately held company and our shares were no longer traded on the New York Stock Exchange.

Non-GAAP Financial Measures

We use several measures derived from consolidated financial information, but not presented in our Condensed Consolidated Financial Statements prepared in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”). These measures are considered non-GAAP financial measures. Specifically, in this report, we refer to adjusted earnings before interest, income taxes, depreciation and amortization (“Adjusted EBITDA”) and Adjusted EBITDA as a percentage of net sales, which are non-GAAP financial measures (collectively, our “non-GAAP financial measures”). Our non-GAAP financial measures are not intended to replace the presentation of the comparable measures under U.S. GAAP. However, we believe the presentation of the non-GAAP financial measures, when considered together with the comparable U.S. GAAP financial measure, along with a reconciliation to its respective U.S. GAAP financial measure, enables investors to better understand the factors and trends affecting our underlying business that could not be obtained absent these disclosures. Additionally, we believe that the presentation of our non-GAAP financial measures enables investors to evaluate trends in the business excluding certain items which are not entirely a result of our core operations.

Furthermore, the presentation of these non-GAAP financial measures supplements other metrics we use to internally evaluate our business and facilitates the comparison of past and present operations. The non-GAAP financial measures we use may differ from non-GAAP financial measures used by other companies, and other companies may not define non-GAAP financial measures we use in the same way, even if similarly titled.

Predecessor and Successor Periods

The MD&A provides an overview of our financial condition as of September 30, 2023 and the results of operations for the periods subsequent to July 25, 2022 (“Successor”) and for periods prior to July 25, 2022 (“Predecessor”). Our Condensed Consolidated Statements of (Loss) Income as reported in our Condensed Consolidated Financial Statements for these periods are prepared in accordance with U.S. GAAP.


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ToWe ~~enhance~~are ~~the~~mindful ~~analysis~~ of ~~our operating results for~~ the ~~periods~~harmful ~~presented,~~effects ~~we have included a discussion~~ of ~~selected~~global ~~financial~~climate ~~and~~change ~~operating data of the Predecessor~~ and ~~Successor on a combined basis. The presentation consists of~~ the ~~mathematical~~contributions ~~addition~~to ofclimate ~~selected~~change ~~financial and operating data of the Successor for the period~~ from ~~July~~manufacturing ~~25,~~operations ~~2022~~and ~~through October 1, 2022 with~~ the ~~comparable~~end-use ~~financial and operating data~~ of ~~the~~building ~~Predecessor~~construction ~~for the periods from July 3, 2022 through July 24, 2022 and January 1, 2022 through July 24, 2022~~products. ~~There~~We ~~are~~have ~~no other adjustments~~ made ~~in the combined presentation. The mathematical combination of selected financial~~ and ~~operating~~continue ~~data~~to ismake ~~included~~progress ~~below~~on ~~under~~our ~~the~~work ~~heading~~related ~~“Combined” and this data is a non-GAAP presentation. Management believes that this selected financial and operating data provides investors with useful information upon which~~ to ~~assess~~sustainability ~~our operating performance~~matters.

Reconciliation of Net Income (Loss) to Adjusted EBITDA and Adjusted EBITDA as a Percentage of Net Sales

The following table presents the reconciliation of net income (loss) to Adjusted EBITDA and computes Adjusted EBITDA as a percentage of net sales:

	Three Months Ended												Nine Months Ended
	Successor						Predecessor			Combined*			Successor						Predecessor			Combined*
(Amounts in thousands)	Period from July 2, 2023 through September 30, 2023			Period from July 25, 2022 through October 1, 2022			Period from July 3, 2022 through July 24, 2022			Period from July 3, 2022 through October 1, 2022			Period from January 1, 2023 through September 30, 2023			Period from July 25, 2022 through October 1, 2022			Period from January 1, 2022 through July 24, 2022			Period from January 1, 2022 through October 1, 2022
Net income (loss)	$	2,737		$	(4,445)		$	1,444		$	(3,001)		$	(48,404)		$	(4,445)		$	483,786		$	479,341
Depreciation and amortization	93,253			56,260			18,289			74,549			331,077			56,260			166,177			222,437
Interest expense	91,013			65,813			11,401			77,214			277,438			65,813			101,078			166,891
Income tax provision (benefit)	890			(1,672)			(1,049)			(2,721)			(18,435)			(1,672)			165,814			164,142
Earnings before interest, income taxes, depreciation and amortization	187,893			115,956			30,085			146,041			541,676			115,956			916,855			1,032,811
Strategic development and acquisition related costs	3,997			2,735			28,895			31,630			20,534			2,735			49,560			52,295
Acquired inventory step-up amortization	—			30,317			—			30,317			—			30,317			—			30,317
Loss (gain) on divestitures	10,080			1,762			—			1,762			10,080			1,762			(401,413)			(399,651)
Gain on legal settlements	—			—			—			—			—			—			(76,575)			(76,575)
Long-term incentive plan compensation (1)	4,696			8,837			937			9,774			8,469			8,837			17,099			25,936
Foreign exchange loss (gain)	3,753			(12,489)			454			(12,035)			(2,694)			(12,489)			(686)			(13,175)
(Gain) loss on extinguishment of debt	—			—			(24,801)			(24,801)			184			—			(28,354)			(28,354)
Employee separation and facility closure charges	7,701			2,399			975			3,374			19,132			2,399			92			2,491
Other (income) expense, net	(4,027)			(172)			(114)			(286)			(8,832)			(172)			(101)			(273)
Other	2,642			105			151			256			7,888			105			1,820			1,925
Adjusted EBITDA (2)	$	216,735		$	149,450		$	36,582		186,032			$	596,437		$	149,450		$	478,297		627,747
Adjusted EBITDA as a percentage of net sales	15.2		%	11.7		%	10.0		%	11.3		%	14.4		%	11.7		%	12.8		%	12.5		%

*Refer to Non-GAAP Financial Measures for further discussion.

(1)Reflects expenses related to long-term incentive compensation plans, which primarily includes awards that were granted prior to the Merger (“Pre-Merger Awards”) and incentive unit grants that occurred subsequent to the Merger.

(2)The above periods, to the extent applicable, exclude the operations of divestitures as noted below in the “Impact of Divestitures and Acquisitions” section.

Seasonality

Our sales volume is generally higher during our second and third quarters, which is historically the peak season for construction and remodeling in North America. Seasonal variations in our operational results may be negatively impacted by inclement weather and other conditions. Working capital requirements have generally been greatest during the first half of our fiscal year due to the timing of the buildup of inventory to support the heavier construction season.

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Impact of Divestitures and Acquisitions

In our MD&A, the impact of divestitures, when presented, is quantified as the portion of the preceding twelve months post- or pre-transaction where no comparable period is available. Specifically, in our Shelter Solutions reportable segment, we completed the sale of our coil coatings business in June 2022. In our Surface Solutions reportable segment, we completed the acquisition of M.A.C. Métal Architectural Inc. in August 2023.

Results of Operations

The following table represents key results of operations on a consolidated basis for the interim periods indicated, and the changes between periods:

	Three Months Ended												~~Nine Months Ended~~
	Successor						Predecessor			Combined *			Successor						Predecessor			Combined *
(Amounts in thousands)	March 30, 2024			April 1, 2023
(Amounts in thousands)	Period from July 2, 2023 through September 30, 2023			Period from July 25, 2022 through October 1, 2022			Period from July 3, 2022 through July 24, 2022			Period from July 3, 2022 through October 1, 2022			Period from January 1, 2023 through September 30, 2023			Period from July 25, 2022 through October 1, 2022			Period from January 1, 2022 through July 24, 2022			Period from January 1, 2022 through October 1, 2022
Net sales	$	1,145,687		$	1,279,088
Net sales	$	1,424,758		$	1,274,883		$	365,445		$	1,640,328		$	4,132,064		$	1,274,883		$	3,736,084		$	5,010,967
Gross profit	233,556			281,861
Gross profit	333,067			233,623			73,398			307,021			912,765			233,623			806,385			1,040,008
% of net sales	20.4		%	22.0		%
% of net sales	23.4		%	18.3		%	20.1		%	18.7		%	22.1		%	18.3		%	21.6		%	20.8		%
Selling, general and administrative expenses	240,845			227,801
Selling, general and administrative expenses	228,621			184,826			86,063			270,889			703,428			184,826			562,836			747,662
% of net sales	21.0%			17.8		%
% of net sales	16.0%			14.5		%	23.6		%	16.5%			17.0%			14.5		%	15.1		%	14.9%
(Loss) income from operations	(7,289)			54,060
Loss (gain) on divestitures	10,080			1,762			—			1,762			10,080			1,762			(401,413)			(399,651)
% of net sales	(0.6)		%	4.2%
Gain on legal settlements	—			—			—			—			—			—			(76,575)			(76,575)
Interest expense	(94,820)			(94,111)
Income (loss) from operations	94,366			47,035			(12,665)			34,370			199,257			47,035			721,537			768,572
Foreign exchange (loss) gain	(4,013)			2,017
Interest expense	(91,013)			(65,813)			(11,401)			(77,214)			(277,438)			(65,813)			(101,078)			(166,891)
Loss on extinguishment of debt	—			(563)
Foreign exchange (loss) gain	(3,753)			12,489			(454)			12,035			2,694			12,489			686			13,175
Other income, net	2,883			1,173
Gain (loss) on extinguishment of debt	—			—			24,801			24,801			(184)			—			28,354			28,354
Loss before income taxes	(103,239)			(37,424)
Other income, net	4,027			172			114			286			8,832			172			101			273
Income tax provision (benefit)	15,334			(8,609)
Income (loss) before income taxes	3,627			(6,117)			395			(5,722)			(66,839)			(6,117)			649,600			643,483
Net loss	$	(118,573)		$	(28,815)
Income tax provision (benefit)	890			(1,672)			(1,049)			(2,721)			(18,435)			(1,672)			165,814			164,142
Non-GAAP financial measure – Adjusted EBITDA*	$	106,941		$	141,180
Net income (loss)	$	2,737		$	(4,445)		$	1,444		$	(3,001)		$	(48,404)		$	(4,445)		$	483,786		$	479,341
% of net sales	9.3		%	11.0		%
Non-GAAP financial measures*:
* Refer to Non-GAAP Financial Measures for further discussion.
Adjusted EBITDA	$	216,735		$	149,450		$	36,582		$	186,032		$	596,437		$	149,450		$	478,297		$	627,747
Adjusted EBITDA as a percentage of net sales	15.2		%	11.7		%	10.0		%	11.3		%	14.4		%	11.7		%	12.8		%	12.5		%

*ReferNet tosales ~~Non-GAAP~~decreased ~~Financial~~$133.4 ~~Measures~~million, or 10.4%, for ~~further~~the ~~discussion~~three months ended March 30, 2024 compared to the three months ended April 1, 2023, mainly due to lower volume across all reportable segments, partially offset by the strategic acquisitions of M.A.C. Métal Architectural Inc. (“MAC Metal”) in August 2023 and Eastern Architectural Systems (“EAS”) in December 2023.

~~Net~~Gross ~~sales~~profit ~~decreased~~as ~~$215.6~~a ~~million,~~percentage orof 13net sales was 20.14% for the three ~~month~~months ~~period~~ ended ~~September~~March 30, ~~2023~~2024, compared to ~~the comparable prior year period, and decreased $878~~22.~~9 million, or 17.5~~0% for the ~~nine~~three ~~month~~months ~~period~~ ended ~~September~~April 301, 2023. ~~compared~~The todecrease ~~the~~was ~~comparable~~driven ~~prior~~by ~~year~~lower ~~period~~volumes, ~~mainly~~partially ~~due~~offset toby ~~lower~~manufacturing ~~volume~~net ~~across all reportable segments and the impact from the strategic divestiture of our coil coatings business in June 2022~~efficiencies.

~~Gross~~Selling, ~~profit~~general asand aadministrative ~~percentage~~expenses ofincreased ~~net~~$13.0 ~~sales~~million, ~~was~~or 235.47%, for the three ~~month~~months ~~period~~ ended ~~September~~ March 30, ~~2023~~2024, compared to ~~18.7% for~~ the ~~comparable~~three ~~prior~~months ~~year~~ended ~~period,~~April ~~and 22.~~1~~% for the nine month period ended September 30~~, 2023~~, compared to 20~~.8% ~~for~~The ~~the~~increase ~~comparable~~was ~~prior~~mainly ~~year~~due ~~period.~~to ~~These~~higher ~~increases~~employee ~~are~~compensation ~~driven~~expenses, byrelated ~~favorable~~to ~~product~~the ~~mix,~~timing ~~price net~~ of ~~inflation~~long-term ~~and~~incentive ~~manufacturing~~compensation ~~net efficiencies~~accruals.

28Other income, net, increased by $1.7 million for the three months ended March 30, 2024, compared to the three months ended April 1, 2023 mainly due to higher interest income earned on our cash and cash equivalents.

Interest expense increased by $0.7 million for the three months ended March 30, 2024, compared to the three months ended April 1, 2023. The following table sets forth the components of interest expense:


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Selling, general and administrative expenses decreased $42.3 million, or 15.6%, for the three month period ended September 30, 2023 compared to the comparable prior year period, and decreased $44.2 million, or 5.9%, for the nine month period ended September 30, 2023 compared to the comparable prior year period. These decreases are mainly due to a decrease in Merger related transaction costs, including employee compensation expenses, partially offset by an increase in depreciation and amortization resulting from the update in the fair market value of property, plant and equipment and intangible assets acquired, shortened useful lives and a higher depreciable base as a result of the Merger.


	Three Months Ended
(Amounts in thousands)	March 30, 2024		April 1, 2023
Interest on outstanding borrowings	$	83,928	$	80,179
Cash impact of interest rate swaps	(13,019)		(9,039)
Amortization of interest rate swap fair value(1)	2,962		2,995
Amortization of debt discount, debt issuance costs and purchase accounting fair value adjustment(1)	20,914		19,768
Other	35		208
Total interest expense	$	94,820	$	94,111

~~Gain~~(1)The onfair ~~divestitures~~value ~~mainly~~adjustments ~~consists~~were ofmade ~~a net gain recognized~~ in connection with the ~~strategic~~Merger ~~divestiture of our coil coatings business, with the original gain recognized~~ in ~~June~~July 2022 ~~of $394~~.~~2 million, offset by a $10.1 million expense in the third quarter of 2023 resulting from a settlement to finalize working capital.~~

~~Gain~~Foreign onexchange ~~legal~~(loss) ~~settlements~~gain ~~consists~~was $4.0 million of aloss ~~gain~~for ~~recognized~~the inthree months ended March ~~2022~~ of30, 2024 compared to $762.6 0 million ~~related~~of gains for the three months ended April 1, 2023. The changes period over period are attributable to ~~shareholder~~foreign ~~litigation~~exchange rate changes on intercompany loans based in Canadian currency.

~~Interest~~Loss ~~expense~~on ~~increased~~extinguishment byof debt included a loss of $130.86 million for the three ~~month~~months ~~period~~ended ~~and~~April ~~$110.5~~1, ~~million~~2023, ~~for~~which resulted from the ~~nine~~repurchase ~~month~~of ~~period~~our ~~ended~~6.125% ~~September 30,~~Senior ~~2023,~~notes ~~each~~due ~~compared~~January to2029 (“the ~~comparable~~6.125% ~~prior~~Senior ~~year~~Notes”) ~~period~~during the three months ended April 1, 2023. ~~The~~No ~~following~~repurchases ~~table~~were ~~sets~~made ~~forth~~during the ~~components~~three ofmonths ~~interest~~ended ~~expense:~~March 30, 2024.

	Three Months Ended								Nine Months Ended
	Successor				Predecessor		Combined*		Successor				Predecessor		Combined*
(Amounts in thousands)	Period from July 2, 2023 through September 30, 2023		Period from July 25, 2022 through October 1, 2022		Period from July 3, 2022 through July 24, 2022		Period from July 3, 2022 through October 1, 2022		Period from January 1, 2023 through September 30, 2023		Period from July 25, 2022 through October 1, 2022		Period from January 1, 2022 through July 24, 2022		Period from January 1, 2022 through October 1, 2022
Interest expense on outstanding borrowings (1)	$	85,772	$	49,285	$	8,876	$	58,161	$	246,933	$	49,285	$	76,451	$	125,736
Interest (income) expense attributable to interest rate swaps	(15,345)		1,221		1,929		3,150		(29,350)		1,221		20,586		21,807
Amortization of debt discount, debt issuance costs and purchase accounting fair value adjustment	20,242		15,204		391		15,595		59,207		15,204		3,696		18,900
Other	344		103		205		308		648		103		345		448
Total interest expense	$	91,013	$	65,813	$	11,401	$	77,214	$	277,438	$	65,813	$	101,078	$	166,891

Income tax provision (benefit) increased by $23.9 million for the three-month period ended March 30, 2024 compared to the three months ended April 1, 2023 mainly due to increased state tax expense.

*Refer to Non-GAAP Financial Measures for further discussion.

(1)The incremental interest expense incurred for the three and nine months ended September 30, 2023 compared to the three and nine months ended October 1, 2022 is mainly a result of the additional financing obtained to consummate the Merger.

Foreign exchange (gain) loss were $3.8 million of loss and $2.7 million of gain for the three and nine month periods ended September 30, 2023 compared to $12.0 million and $13.2 million of gains for the three and nine months ended in the comparable prior year period. The changes period over period are attributable to foreign exchange rate changes on intercompany loans based in Canadian currency.

Gain (loss) on extinguishment of debt includes a loss of $0.2 million, which included a $13.1 million write-off of unamortized deferred financing costs from the repurchase of our 6.125% Senior Notes due January 2029 (the “6.125% Senior Notes”) during the nine month period ended September 30, 2023. A gain of $28.4 million for the nine month period in the comparable prior year period ended October 1, 2022 resulted from the repurchase of our 6.125% Senior Notes. No repurchases were made during the three month period ended September 30, 2023.

Income tax provision (benefit) increased by $3.6 million for the three month period ended September 30, 2023 compared to the comparable prior year period and decreased by $182.6 million for the nine month period ended September 30, 2023 compared to the comparable prior year period mainly due to lower pre-tax earnings for the reasons discussed above.

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Reportable Segment Results of Operations

The following table sets forth the continuing results of operations for our reportable segments:

	Three Months Ended								~~Nine Months Ended~~
	Successor				Predecessor		Combined*		Successor				Predecessor		Combined*
(Amounts in thousands)	March 30, 2024		April 1, 2023
(Amounts in thousands)	Period from July 2, 2023 through September 30, 2023		Period from July 25, 2022 through October 1, 2022		Period from July 3, 2022 through July 24, 2022		Period from July 3, 2022 through October 1, 2022		Period from January 1, 2023 through September 30, 2023		Period from July 25, 2022 through October 1, 2022		Period from January 1, 2022 through July 24, 2022		Period from January 1, 2022 through October 1, 2022
Net sales:
Net sales:
Aperture Solutions	$	529,840	$	604,569
Aperture Solutions	$	637,669	$	569,994	$	164,039	$	734,033	$	1,889,913	$	569,994	$	1,643,619	$	2,213,613
Surface Solutions	274,336		268,591
Surface Solutions	357,400		288,080		85,034		373,114		961,513		288,080		839,130		1,127,210
Shelter Solutions	341,511		405,928
Shelter Solutions	429,689		416,809		116,372		533,181		1,280,638		416,809		1,253,335		1,670,144
Total net sales	$	1,145,687	$	1,279,088
Total net sales	$	1,424,758	$	1,274,883	$	365,445	$	1,640,328	$	4,132,064	$	1,274,883	$	3,736,084	$	5,010,967
Adjusted reportable segment EBITDA:
Adjusted reportable segment EBITDA*:
Aperture Solutions	$	44,880	$	64,793
Aperture Solutions	$	91,946	$	74,235	$	15,045	$	89,280	$	260,032	$	74,235	$	202,682	$	276,917
Surface Solutions	43,235		26,307
Surface Solutions	79,205		32,978		8,576		41,554		167,011		32,978		143,880		176,858
Shelter Solutions	56,077		83,414
Shelter Solutions	79,002		70,736		21,219		91,955		268,386		70,736		209,156		279,892
Corporate and Other	(57,164)		(47,792)
Corporate and Other	(62,534)		(74,654)		(39,216)		(113,870)		(165,095)		(74,654)		331,996		257,342
Depreciation and amortization	(94,317)		(72,662)
Depreciation and amortization	(93,253)		(56,260)		(18,289)		(74,549)		(331,077)		(56,260)		(166,177)		(222,437)
Income (loss) from operations	$	(7,289)	$	54,060
Income (loss) from operations	$	94,366	$	47,035	$	(12,665)	$	34,370	$	199,257	$	47,035	$	721,537	$	768,572

*Refer to Non-GAAP Financial Measures for further discussion.

Aperture Solutions

The following table sets forth the continuing results of operations for the Aperture Solutions reportable segment:

	Three Months Ended												~~Nine Months Ended~~
	Successor						Predecessor			Combined*			Successor						Predecessor			Combined*
(Amounts in thousands)	March 30, 2024			April 1, 2023
(Amounts in thousands)	Period from July 2, 2023 through September 30, 2023			Period from July 25, 2022 through October 1, 2022			Period from July 3, 2022 through July 24, 2022			Period from July 3, 2022 through October 1, 2022			Period from January 1, 2023 through September 30, 2023			Period from July 25, 2022 through October 1, 2022			Period from January 1, 2022 through July 24, 2022			Period from January 1, 2022 through October 1, 2022
Net sales	$	529,840		$	604,569
Net sales	$	637,669		$	569,994		$	164,039		$	734,033		$	1,889,913		$	569,994		$	1,643,619		$	2,213,613
Adjusted reportable segment EBITDA	$	44,880		$	64,793
Adjusted reportable segment EBITDA*	$	91,946		$	74,235		$	15,045		$	89,280		$	260,032		$	74,235		$	202,682		$	276,917
% of net sales	8.5		%	10.7		%
% of net sales	14.4		%	13.0		%	9.2		%	12.2		%	13.8		%	13.0		%	12.3		%	12.5		%
Depreciation and amortization	$	41,438		$	35,925
Depreciation and amortization	$	42,701		$	27,943		$	8,305		$	36,248		$	146,633		$	27,943		$	79,816		$	107,759

*Refer to Non-GAAP Financial Measures for further discussion.20

Net sales for the three month period ended September 30, 2023 decreased $96.4 million, or 13.1%, and for the nine month period ended September 30, 2023 decreased $323.7 million, or 14.6%, mainly driven by lower volumes, partially offset by favorable price and product mix.

Adjusted segment EBITDA for the three month period ended September 30, 2023 increased $2.7 million and for the nine month period ended September 30, 2023 decreased $16.9 million, mainly due to lower volume, partially offset by favorable price net of inflation, product mix and manufacturing net efficiencies.


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Net sales for the three months ended March 30, 2024 decreased $74.7 million, or 12.4%, mainly driven by lower volumes, partially offset by the strategic acquisition of EAS in December 2023.

Adjusted reportable segment EBITDA for the three months ended March 30, 2024 decreased $19.9 million, mainly due to lower volumes, partially offset by manufacturing net efficiencies and the strategic acquisition of EAS in December 2023.

Surface Solutions

The following table sets forth the continuing results of operations for the Surface Solutions reportable segment:

	Three Months Ended												~~Nine Months Ended~~
	Successor						Predecessor			Combined*			Successor						Predecessor			Combined*
(Amounts in thousands)	March 30, 2024			April 1, 2023
(Amounts in thousands)	Period from July 2, 2023 through September 30, 2023			Period from July 25, 2022 through October 1, 2022			Period from July 3, 2022 through July 24, 2022			Period from July 3, 2022 through October 1, 2022			Period from January 1, 2023 through September 30, 2023			Period from July 25, 2022 through October 1, 2022			Period from January 1, 2022 through July 24, 2022			Period from January 1, 2022 through October 1, 2022
Net sales	$	274,336		$	268,591
Net sales	$	357,400		$	288,080		$	85,034		$	373,114		$	961,513		$	288,080		$	839,130		$	1,127,210
Adjusted reportable segment EBITDA	$	43,235		$	26,307
Adjusted reportable segment EBITDA*	$	79,205		$	32,978		$	8,576		$	41,554		$	167,011		$	32,978		$	143,880		$	176,858
% of net sales	15.8		%	9.8		%
% of net sales	22.2		%	11.4		%	10.1		%	11.1		%	17.4		%	11.4		%	17.1		%	15.7		%
Depreciation and amortization	$	26,530		$	29,333
Depreciation and amortization	$	25,545		$	22,679		$	8,041		$	30,720		$	65,284		$	22,679		$	65,225		$	87,904

*ReferNet tosales ~~Non-GAAP~~for ~~Financial~~the ~~Measures~~three ~~for~~months ~~further~~ended ~~discussion~~March 30, 2024 increased by $5.7 million, or 2.1%, mainly driven by the strategic acquisition of MAC Metal in August 2023 and favorable price and product mix, partially offset by lower volume.

~~Net~~Adjusted ~~sales~~reportable segment EBITDA for the three ~~month~~months ~~period~~ ended ~~September~~ March 30, ~~2023~~2024 ~~decreased~~increased by $1516.79 million, ormainly ~~4.2%,~~due ~~and~~to ~~for~~favorable ~~the~~price ~~nine~~and ~~month~~product ~~period~~mix ~~ended~~net ~~September 30~~of inflation, ~~2023~~net ~~decreased~~manufacturing ~~$165.7~~efficiencies ~~million,~~and orthe ~~14.7%~~strategic acquisition of MAC Metal in August 2023, ~~mainly~~partially ~~driven~~offset by ~~changes~~lower involumes ~~price~~and ~~from~~higher ~~movement~~selling, ingeneral ~~input~~and administrative costs.

Adjusted reportable segment EBITDA for the three month period ended September 30, 2023 increased $37.7 million, mainly due to the net impact of price, mix and movement in input costs.

Adjusted reportable segment EBITDA for the nine month period ended September 30, 2023 decreased $9.8 million, mainly due to lower volume, partially offset by the net impact of price, mix and movement in input costs.

Shelter Solutions

The following table sets forth the continuing results of operations for the Shelter Solutions reportable segment:

	Three Months Ended												~~Nine Months Ended~~
	Successor						Predecessor			Combined*			Successor						Predecessor			Combined*
(Amounts in thousands)	March 30, 2024			April 1, 2023
(Amounts in thousands)	Period from July 2, 2023 through September 30, 2023			Period from July 25, 2022 through October 1, 2022			Period from July 3, 2022 through July 24, 2022			Period from July 3, 2022 through October 1, 2022			Period from January 1, 2023 through September 30, 2023			Period from July 25, 2022 through October 1, 2022			Period from January 1, 2022 through July 24, 2022			Period from January 1, 2022 through October 1, 2022
Net sales	$	341,511		$	405,928
Net sales	$	429,689		$	416,809		$	116,372		$	533,181		$	1,280,638		$	416,809		$	1,253,335		$	1,670,144
Adjusted reportable segment EBITDA	$	56,077		$	83,414
Adjusted reportable segment EBITDA*	$	79,002		$	70,736		$	21,219		$	91,955		$	268,386		$	70,736		$	209,156		$	279,892
% of net sales	16.4		%	20.5		%
% of net sales	18.4		%	17.0		%	18.2		%	17.2		%	21.0		%	17.0		%	16.7		%	16.8		%
Depreciation and amortization	$	25,638		$	5,800
Depreciation and amortization	$	24,361		$	4,391		$	1,552		$	5,943		$	115,044		$	4,391		$	18,016		$	22,407

*ReferNet tosales ~~Non-GAAP~~for ~~Financial~~the ~~Measures~~three ~~for~~months ~~further~~ended ~~discussion~~March 30, 2024 decreased $64.4 million, or 15.9%, mainly driven by lower volumes and unfavorable product and price mix.

~~Net~~Adjusted ~~sales~~reportable segment EBITDA for the three ~~month~~months ~~period~~ ended ~~September~~ March 30, ~~2023~~2024 decreased $~~103~~27.53 million, ormainly ~~19.4%,~~due ~~and~~to ~~for~~lower ~~the~~volumes, ~~nine~~unfavorable ~~month~~product ~~period~~and ~~ended~~price ~~September 30,~~mix ~~2023~~net ~~decreased~~of ~~$389.5~~inflation ~~million,~~partially oroffset ~~23.3%, mainly driven~~ by ~~changes~~manufacturing innet ~~price from movement in input costs~~efficiencies.

Adjusted reportable segment EBITDA for the three month period ended September 30, 2023 decreased $13.0 million and for the nine month period ended September 30, 2023 decreased by $11.5 million, mainly due to lower volume and the impact of the strategic divestitures of our coil coatings business in June 2022, partially offset by the net impact of price, mix and movement in input costs.

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Corporate and Other

The following table sets forth Corporate and other:

	Three Months Ended								~~Nine Months Ended~~
	Successor				Predecessor		Combined*		Successor				Predecessor		Combined*
(Amounts in thousands)	March 30, 2024		April 1, 2023
(Amounts in thousands)	Period from July 2, 2023 through September 30, 2023		Period from July 25, 2022 through October 1, 2022		Period from July 3, 2022 through July 24, 2022		Period from July 3, 2022 through October 1, 2022		Period from January 1, 2023 through September 30, 2023		Period from July 25, 2022 through October 1, 2022		Period from January 1, 2022 through July 24, 2022		Period from January 1, 2022 through October 1, 2022
Corporate costs	$	37,251	$	33,334
Corporate costs	$	33,418	$	28,499	$	8,258	$	36,757	$	98,992	$	28,499	$	77,421	$	105,920
Strategic development and acquisition related costs	4,074		7,622
Strategic development and acquisition related costs	3,997		2,735		28,895		31,630		20,534		2,735		49,560		52,295
Long-term incentive plan compensation	10,514		(2,355)
Acquired inventory step-up amortization	—		30,317				30,317		—		30,317		—		30,317
Facility closure charges and employee separation	1,526		8,822
Gain on legal settlements	—		—		—		—		—		—		(76,575)		(76,575)
Other	3,799		369
Loss (gain) on divestitures	10,080		1,762		—		1,762		10,080		1,762		(401,413)		(399,651)
Total Corporate and Other	$	57,164	$	47,792
Long-term incentive plan compensation	4,696		8,837		937		9,774		8,469		8,837		17,099		25,936
Employee separation and facility closure charges	7,701		2,399		975		3,374		19,132		2,399		92		2,491
Other	2,642		105		151		256		7,888		105		1,820		1,925
Total Corporate and other	$	62,534	$	74,654	$	39,216	$	113,870	$	165,095	$	74,654	$	(331,996)	$	(257,342)

*ReferCorporate tocosts ~~Non-GAAP~~increased ~~Financial~~by ~~Measures~~$3.9 million for ~~further~~the ~~discussion~~three months ended March 30, 2024, mainly due to higher employee compensation expenses.

~~Corporate costs decreased by $3.3 million and $6.9 million for the three and nine month periods ended September 30, 2023 mainly due to lower compensation related costs.~~21

Depreciation and Amortization

	Three Months Ended								Nine Months Ended
	Successor				Predecessor		Combined*		Successor				Predecessor		Combined*
(Amounts in thousands)	Period from July 2, 2023 through September 30, 2023		Period from July 25, 2022 through October 1, 2022		Period from July 3, 2022 through July 24, 2022		Period from July 3, 2022 through October 1, 2022		Period from January 1, 2023 through September 30, 2023		Period from July 25, 2022 through October 1, 2022		Period from January 1, 2022 through July 24, 2022		Period from January 1, 2022 through October 1, 2022
Depreciation:
Cost of sales	$	40,818	$	18,852	$	677	$	19,529	$	159,955	$	18,852	$	6,356	$	25,208
Selling, general and administrative expenses	7,745		384		5,217		5,601		44,830		384		50,370		50,754
Total depreciation	48,563		19,236		5,894		25,130		204,785		19,236		56,726		75,962
Amortization: Selling, general and administrative expenses	44,690		37,024		12,395		49,419		126,292		37,024		109,451		146,475
Total depreciation and amortization	$	93,253	$	56,260	$	18,289	$	74,549	$	331,077	$	56,260	$	166,177	$	222,437

*Refer to Non-GAAP Financial Measures for further discussion.

Depreciation and amortization increased by $18.7 million for the three month period ended September 30, 2023 compared to the comparable prior year period primarily due to shortened useful lives and a higher depreciable base as a result of the Merger.

Depreciation and amortization increased by $108.6 million for the nine month period ended September 30, 2023 mainly due to the Company recording a cumulative catch-up adjustment resulting in increases of $65.2 million and $1.3 million to cost of sales and selling, general and administrative expenses to account for the update in fair value of these assets as if the adjustments had been made as of the date of the Merger, as well as shortened useful lives and a higher depreciable base as a result of the Merger.


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	Three Months Ended
(Amounts in thousands)	March 30, 2024		April 1, 2023
Depreciation:
Cost of sales	$	40,932	$	19,351
Selling, general and administrative expenses	6,151		5,407
Total depreciation	47,083		24,758
Amortization — Selling, general and administrative expenses	47,234		47,904
Total depreciation and amortization	$	94,317	$	72,662

Depreciation and amortization increased by $21.7 million for the three months ended March 30, 2024 compared to April 1, 2023, primarily due to shortened useful lives and a higher depreciable base as a result of the merger transaction during July 2022 (the “Merger”) and the strategic acquisition of MAC Metal during August 2023 and EAS during December 2023.

Non-GAAP Financial Measures

We use several measures derived from consolidated financial information, but not presented in our Condensed Consolidated Financial Statements prepared in accordance with accounting principles generally accepted in the U.S (“U.S. GAAP”). These measures are considered non-GAAP financial measures. Specifically, in this report, we refer to adjusted EBITDA, which is a non-GAAP financial measure. Our non-GAAP financial measure is not intended to replace the presentation of the comparable measure under U.S. GAAP. However, we believe the presentation of the non-GAAP financial measure, when considered together with the comparable U.S. GAAP financial measure, along with a reconciliation to its respective U.S. GAAP financial measure, assists investors in understanding the factors and trends affecting our underlying business that could not be obtained absent these disclosures. Additionally, we believe that the presentation of our non-GAAP financial measure enables investors to evaluate trends in the business excluding certain items which are not entirely a result of our base operations.

Furthermore, the presentation of this non-GAAP financial measure supplements other metrics we use to internally evaluate our business and facilitates the comparison of past and present operations. The non-GAAP financial measure we use may differ from non-GAAP financial measures used by other companies and other companies may not define non-GAAP financial measures we use in the same way.

Reconciliation of Net Loss to Adjusted EBITDA

The following table presents the reconciliation of net loss to Adjusted EBITDA:


	Three Months Ended
(Amounts in thousands)	March 30, 2024		April 1, 2023
Net loss	$	(118,573)	$	(28,815)
Interest expense	94,820		94,111
Foreign exchange (gain) loss	4,013		(2,017)
Gain on extinguishment of debt	—		563
Other income, net	(2,883)		(1,173)
Income tax provision (benefit)	15,334		(8,609)
(Loss) income from operations	(7,289)		54,060
Depreciation and amortization	94,317		72,662
Strategic development and acquisition related costs	4,074		7,622
Long-term incentive plan compensation(1)	10,514		(2,355)
Facility closure charges and employee separation	1,526		8,822
Other	3,799		369
Adjusted EBITDA	$	106,941	$	141,180

See Part I, Item 1, “Condensed Consolidated Financial Statements”, Note 12 — Reportable Segment and Geographical Information, included herein, for the reconciliation of adjusted reportable segment EBITDA to loss before income taxes. Adjusted reportable segment EBITDA is the only measure of segment profit used by our chief operating decision maker.


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Liquidity and Capital Resources

Our main liquidity and capital resource needs are payments to service our debt, ongoing operations and working capital requirements, capital expenditures and the cost of acquisitions. Our primary source of liquidity is cash generated from our continuing operations, as well as borrowings under our credit facilities. We believe that funds provided by these sources will be adequate to meet our liquidity and capital resource needs for at least the next 12 months under current operating conditions.

We may from time to time take steps to reduce our debt. These actions may include repurchases or opportunistic refinancing of debt. The amount of debt, if any, that may be repurchased or refinanced will depend on market conditions, trading levels of our debt, our cash position, compliance with debt covenants and other considerations. Our affiliates may also purchase our debt from time to time, through open market purchases or other transactions. In such cases, our debt may not be retired, in which case we would continue to pay interest in accordance with the terms of such debt, and we would continue to reflect the debt as outstanding in our ~~condensed~~Condensed ~~consolidated~~Consolidated ~~balance~~Balance ~~sheets~~Sheets.

The following table sets forth our total net liquidity position as of ~~September~~ March 30, ~~2023~~2024:

(Amounts in thousands)	Amount
Cash and cash equivalents	$	~~475~~117,~~820~~299
Revolving credit facilities:
Asset-based lending facility (1)	850,000
Asset-based lending facility(1)	850,000
Cash flow revolving facility	92,000
First-in-last-out tranche asset-based lending facility (1)	95,000
First-in-last-out tranche asset-based lending facility	95,000
Total revolving credit facilities	1,037,000
Less:
Debt issued under the facilities	—100,000
Letters of credit outstanding and priority payables	4742,000
Net credit facility	~~990~~895,000
Net liquidity	$	1,~~465~~012,~~820~~299

(1) Borrowing availability under the ABL Facilities is determined based on specified percentages of the value of eligible inventory, accounts receivable, less certain allowances and subject to certain other adjustments as set forth in the ABL Credit Agreement. Availability is also reduced by issuance of letters of credit.

Cash Flows

	Nine Months Ended
	Three Months Ended
	Successor				Predecessor		Combined*
(Amounts in thousands)	March 30, 2024		April 1, 2023
(Amounts in thousands)	Period from January 1, 2023 through September 30, 2023		Period from July 25, 2022 through October 1, 2022		Period from January 1, 2022 through July 24, 2022		Period from January 1, 2022 through October 1, 2022
Cash flows from operating activities	$	(163,697)	$	(110,571)
Net cash provided by (used in) operating activities	$	181,159	$	(31,791)	$	350,665	$	318,874
Cash flows from investing activities	$	(49,668)	$	(41,706)
Net cash (used in) provided by investing activities	$	(203,614)	$	(24,402)	$	456,357	$	431,955
Cash flows from financing activities	$	(138,875)	$	(22,000)
Net cash flows used in financing activities	$	(55,635)	$	(598,426)	$	(94,087)	$	(692,513)

*ReferCash toFlows ~~Non-GAAP~~From ~~Financial~~Operating ~~Measures for further discussion.~~Activities

Net ~~Cash~~cash ~~Provided~~from byoperating activities consists mainly of: (~~Used~~i) incash collections on credit sales to our customers, (ii) ~~Operating~~purchases ~~Activities~~of commodity based raw materials, (iii) labor and other employee-related expenditures, (iv) other non-labor costs, such as, among other items, supplies, insurance, advertising and marketing costs, (v) interest paid on our long-term debt and (vi) payments for income taxes.

Net cash ~~provided~~from by operating activities ~~consists~~was ~~mainly of:~~ $(i163.7) ~~cash~~million ~~collections~~for onthe ~~credit~~three ~~sales~~months toended ~~our~~March ~~customers~~30, ~~(ii)~~2024, ~~purchases~~a ofdecrease ~~commodity~~from ~~based~~the ~~raw materials,~~ $(~~iii~~110.6) million ~~labor~~used ~~and~~in ~~other~~operations ~~employee-related~~in ~~expenditures,~~the ~~(iv)~~prior ~~other~~year. ~~non-labor~~Lower ~~costs~~volumes, ~~such~~higher ascore working capital, ~~among~~consisting ~~other~~of ~~items,~~accounts ~~supplies~~receivable, ~~insurance,~~inventories ~~advertising~~ and ~~marketing~~accounts ~~costs~~payable, ~~(v)~~were ~~interest~~offset ~~paid~~by onthe ~~our~~timing ~~long-term~~of ~~debt,~~incentive compensation plan payouts and ~~(vi)~~the ~~payments~~impact ~~for~~of ~~income~~the ~~taxes~~acquisitions.

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~~Net~~Cash ~~cash~~Flows ~~provided~~From byInvesting operating activities was $181.2 million for the nine months ended September 30, 2023, a decrease from the $318.9 million provided by operations in the prior year on lower volumes, higher interest paid, higher payments on accounts payable, payments made to satisfy incentive plan payouts, and cash paid for income taxes, partially offset by the timing of customer collections.Activities

Net Cash (Used In) Provided by Investing Activities

Our main uses of cash for investing activities are for payments for property and equipment and acquisitions of businesses.

Net cash ~~used~~from in investing activities was $~~203~~(49.67) million for the ~~nine~~three months ended ~~September~~ March 30, ~~2023~~2024 compared to $~~432~~(41.0 7) million ~~provided~~used byin investing activities for the ~~nine~~three months ended ~~October~~ April 1, ~~2022~~2023. The $~~635~~8.60 million decrease is mainly driven by ~~$67.8~~an ~~million~~increase ~~paid~~in ~~toward~~capital ~~acquisitions~~expenditures during the ~~nine~~three months ended ~~September~~ March 30, ~~2023,~~2024 ascompared ~~well~~to ~~as $500.0 million received in proceeds from~~ the ~~sale~~three ofmonths ~~the~~ended ~~Company’s~~April ~~coil~~1, ~~coatings business in June 2022~~2023.

~~Net~~ Cash ~~Used~~Flows InFrom Financing Activities

Our main uses of cash for financing activities include activity to ~~consummate~~repurchase ~~the Merger, repurchases~~ and make payments on our long-term debt, and distributions to ~~owners,~~our ~~and~~direct ~~payments~~parent ~~for~~Camelot ~~financing~~Return ~~fees~~Intermediate Holdings, LLC, (“Camelot Parent”). Our main sources of cash from financing activities include the proceeds from issuances of debt ~~and contributions from owners~~.

Net cash ~~used~~from in financing activities was $55(138.69) million for the ~~nine~~three months ended ~~September~~ March 30, ~~2023~~2024 compared to $~~692~~(22.5 0) million used in financing activities for the ~~nine~~three months ended ~~October~~ April 1, ~~2022~~2023. ~~This~~The increase of $~~636~~116.9 million ~~increase~~ is mainly driven by ~~significant activity associated with~~ the ~~Merger~~dividend ~~during~~payment ~~the nine months ended October 1, 2022, which included the purchase~~ of ~~publically held shares totaling~~ $1231.6 ~~billion, the issuance of $710.0~~ million inmade ~~aggregate~~to ~~principal~~Camelot ~~amount~~Parent, ofpartially ~~8.75%~~offset ~~Senior~~by ~~Secured Notes, a~~ $~~300~~100.0 million ~~Side~~in ~~Car~~additional ~~Term~~short-term ~~Loan~~borrowings ~~Facility,~~during the ~~payment~~three ofmonths ~~$85.0~~ended ~~million~~March of30, ~~financing costs and the receipt of $95~~2024.~~0 million in net contributions.~~

Contingent Liabilities and Commitments

Leases

We have leases for certain manufacturing, warehouse, distribution locations, offices, vehicles and equipment. As of ~~September~~ March 30, ~~2023~~2024 the Company had total future lease payments of $~~479~~617.52 million, with $6174.53 million payable within 12 months.

Debt

We have certain long-term debt instruments outstanding. As of ~~September~~ March 30, ~~2023~~2024 the Company had total future payments of $3.9 billion, with $29129.0 million payable within 12 months. See Note 7 — Long-Term Debt in the Notes to the Condensed Consolidated Financial Statements for additional information.

Critical Accounting Estimates

There have been no material changes in our critical accounting policies and estimates during the ~~nine~~three months ended ~~September~~ March 30, ~~2023~~2024. Refer to the ~~2022~~2023 Form 10-K for a description of the Company’s critical accounting estimates.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

There have been no significant changes in our exposure to market risk during the ~~nine~~three months ended ~~September~~ March 30, ~~2023~~2024. Refer to the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2022~~2023 for a description of the Company’s market risks.

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Item 4. Controls and Procedures.

Disclosure Controls and Procedures

Our management, with the participation of our ~~chief~~Chief ~~executive~~Executive ~~officer~~Officer and ~~chief~~Chief ~~financial~~Financial ~~officer~~Officer, evaluated the effectiveness of our disclosure controls and procedures as of ~~September~~ March 30, ~~2023~~2024. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures by a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed with an objective to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding the required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Management believes that our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives and based on the evaluation of our disclosure controls and procedures as of ~~September~~ March 30, ~~2023~~2024, our ~~chief~~Chief ~~executive~~Executive ~~officer~~Officer and ~~chief~~Chief ~~financial~~Financial ~~officer~~Officer concluded that, as of such date, our disclosure controls and procedures were effective at such reasonable assurance level.

~~Internal Control over Financial Reporting~~24

There has been no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended September 30, 2023 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.


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Internal Control over Financial Reporting

There has been no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended March 30, 2024 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

CORNERSTONE BUILDING BRANDS, INC.

PART II — OTHER INFORMATION

Item 1. Legal ~~Proceedings~~Proceeding.

See Part I, Item 1, “Condensed Consolidated Financial Statements”, Note 1213 — Commitments and Contingencies, which is incorporated herein by reference.

Item 1A. Risk Factors.

In addition to the information set forth in this Quarterly Report on Form 10-Q, you should carefully consider the factors discussed under “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2022~~2023 (the “~~2022~~2023 Form 10-K”). The risks disclosed in the ~~2022~~2023 Form 10-K, and information provided elsewhere in this report, could materially affect our business, financial condition or results of operations. Additional risks and uncertainties not currently known, or that we currently deem to be immaterial, may materially adversely affect our business, financial condition or results of operations. ~~Except~~We ~~for such additional information, we~~ believe there have been no other material changes in our risk factors from those disclosed in the ~~2022~~2023 Form 10-K.

~~Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.~~25

As of July 25, 2022, the Company’s common stock is no longer publicly traded either on a stock exchange or in the over-the-counter market.


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Item 6. Exhibits.

Index to Exhibits

Exhibit No.						Description
*10.1						Form of Executive Officer Offer Letter
*†10.1						Form of Notice of Amendment to the Cornerstone Building Brands, Inc. Severance Plan
*†10.2						Form of Amendment to Employment Agreement
*31.1						Rule 13a-14(a)/15d-14(a) Certifications (Section 302 of the Sarbanes-Oxley Act of 2002)
*31.2						Rule 13a-14(a)/15d-14(a) Certifications (Section 302 of the Sarbanes-Oxley Act of 2002)
**32.1						Certifications pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code (Section 906 of the Sarbanes-Oxley Act of 2002)
**32.2						Certifications pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code (Section 906 of the Sarbanes-Oxley Act of 2002)
*101.INS						Inline XBRL Instance Document
*101.SCH						Inline XBRL Taxonomy Extension Schema Document
*101.CAL						Inline XBRL Taxonomy Extension Calculation Linkbase Document
*101.DEF						Inline XBRL Taxonomy Definition Linkbase Document
*101.LAB						Inline XBRL Taxonomy Extension Label Linkbase Document
*101.PRE						Inline XBRL Taxonomy Extension Presentation Linkbase Document
104						Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

* Filed herewith ** Furnished herewith † Management contracts or compensatory plans or arrangements

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	CORNERSTONE BUILDING BRANDS, INC.
Date: November 3, 2023	By:	/s/ Jeffrey S. Lee
Date: April 19, 2024	By:	/s/ Jeffrey S. Lee
		Jeffrey S. Lee
		Executive Vice President and Chief Financial Officer
Date: November 3, 2023	By:	/s/ Wayne F. Irmiter
Date: April 19, 2024	By:	/s/ Wayne F. Irmiter
		Wayne F. Irmiter
		Senior Vice President and Chief Accounting Officer

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Filing Compare · Cornerstone Building Brands, Inc.