**UNITED STATESSECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

 

----

 

**FORM 10-K**

 

| **ý** |   | **Annual  Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934  for the fiscal year ended December 26, 2003** |
|------------|--------|----------------------------------------------------------------------------------------------------------------------------------------|
|       |   |                                                                                                                                   |
| **o**      |   | **Transition  Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934**                                          |

 

**Commission File Number: 333-05978**

 

----

 

**EURAMAXINTERNATIONAL, INC.**

(Exact name ofregistrant as specified in its charter)

 

| **Delaware**                                                                 |   | **58-2502320**                                      |
|------------------------------------------------------------------------------|--------|-----------------------------------------------------|
| (State or other  jurisdiction of  incorporation or organization)             |   | (I.R.S. Employer)  Identification No.)              |
|                                                                         |   |                                                |
| **5445 Triangle Pkwy Suite 350,  Norcross, Georgia**                         |   | **30092**                                           |
| (address of principal  executive offices)                                    |   | (Zip Code)                                          |
|                                                                         |   |                                                |
| Registrant’s telephone number, including area code: **(770)  449-7066** |
|                                                                         |
| Securities registered pursuant to Section 12(b) of the Act:                  |
|                                                                         |   |                                                |
| **Title of  each  class**                                          |   | **Name of each  exchange on which registered** |
| None                                                                         |   | None                                                |
|                                                                         |   |                                                |
| Securities registered pursuant to Section 12(g) of the Act:                  |
| **None**                                                                     |
| **(Title of Class)**                                                         |

 

Indicate by check mark whether the registrant (1)has filed all reports required to be filed by Section 13 or 15(d) of theSecurities Exchange Act of 1934 during the preceding 12 months (or for suchshorter 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 ý No o

 

Indicate by check mark if disclosure of delinquentfilers pursuant to Item 405 of Regulation S-K is not contained herein, and willnot be contained, to the best of registrant’s knowledge, in definitive proxy orinformation statements incorporated by reference in Part III of the Form 10-Kor any amendment to this Form 10-K.  ý

 

Indicate by check mark whether the registrant is anaccelerated filer (as defined in Exchange Act Rule 12b-2).

Yes o No ý

 

As of March 25, 2004, Registrant has 492,495.79shares of Class A common stock outstanding and no shares of Class B commonstock outstanding.

 

 

----

 

Note Regarding Private Securities Litigation ReformAct: Statements contained in this Form 10-K that are nothistorical facts include forward-looking statements that are subject to thesafe harbor rules created by the Private Securities Litigation Reform Act of1995. All statements, other than statements of historical facts, included orincorporated by reference in this Form 10-K which address activities, events ordevelopments which Euramax International, Inc. and subsidiaries (the “Company”or “Euramax”) expect or anticipate will or may occur in the future, includingstatements regarding the Company’s competitive position, the risks ofacquisition of businesses (including limited knowledge of the businessesacquired and misrepresentations by sellers), changes in business strategy ordevelopment plans, cyclical demand for the Company’s products, the supply and/orprice of aluminum and other raw materials, currency exchange rate fluctuations,the Company’s ability to pass on price increases, the impact of environmentallaws and regulations, the availability of financing, reliance on key managementpersonnel, ability to manage growth, the Company’s expectations regarding theadequacy of current financing arrangements, loss of customers, quantitative andqualitative disclosures about market risk, and other statements regardingfuture plans and strategies, anticipated events or trends and similarexpressions concerning matters that are not historical facts are forwardlooking statements. Words such as “expects,” “anticipates,” “intends,” “plans,”“believes,” “estimates,” or variations of such words and similar expressionsare intended to identify such forward-looking statements. These statements arebased on certain assumptions and analyses made by the Company in light of itsexperience and its perception of historical trends, current conditions andexpected future developments as well as other factors it believes areappropriate in the circumstances. However, whether actual results anddevelopments will conform with the Company’s expectations and predictions issubject to a number of risks and uncertainties which could cause actual resultsto differ significantly and materially from past results and from the Company’sexpectations, including the risk factors discussed in this Form 10-K, Item 1“Business,” and Item 7 “Management’s Discussion and Analysis of Financial Conditionsand Results of Operations,” and other factors, many of which are beyond thecontrol of the Company. Consequently, all of the forward-looking statementsmade in this Form 10-K are qualified by these cautionary statements and therecan be no assurance that the actual results or developments anticipated by theCompany will be realized or, even if substantially realized, that they willhave the expected consequences to or effects on the Company or its business oroperations. The Company assumes no obligation to update publicly any suchforward-looking statements, whether as a result of new information, futureevents or otherwise. Unless the context otherwise requires, the terms “we”,“our” and “us” refer to the Company and its subsidiaries collectively.

 

**Part I**

 

**Item 1.  Business**

 

**Overview**

 

Euramax is aninternational producer of value-added aluminum, steel, vinyl and fiberglassfabricated products with facilities located in all major regions of thecontinental United States, or U.S., as well as in the United Kingdom, or U.K.,The Netherlands and France. Our manufacturing and distribution network consistsof 43 strategically located facilities, of which 37 are located in the U.S. andsix are located in Europe. Net sales for 2003 in the U.S. and Europe were$487.0 million and $257.3 million, respectively. We sell our productsprincipally to two markets, the building and construction market and thetransportation market. Our core products include specialty coated coils,aluminum recreational vehicle (or RV) sidewalls, RV doors, farm andagricultural panels, metal and vinyl raincarrying systems, soffit and fasciasystems, and vinyl replacement windows. In addition, we sell an extensive lineof accessory products, including roofing and siding hardware, trim parts androof drainage accessories. Our customers include original equipmentmanufacturers, or OEMs, such as RV manufacturers, commercial panelmanufacturers and transportation industry manufacturers; rural contractors;home centers; home improvement contractors; distributors; industrial andarchitectural contractors; and manufactured housing producers.

 

We operatedownstream of producers of aluminum coil, aluminum extrusions, steel coil andaluminum ingot. These producers supply us with aluminum coil, aluminumextrusions and steel coil. We sold approximately 195 and 268 million pounds ofaluminum and steel, respectively, in 2003. To a lesser extent, we alsodistribute and fabricate products manufactured from vinyl, copper andfiberglass.

 

2

----

 

Wewere established as an independent multinational company in 1996 under the nameEuramax International Limited, which was formed by ACP Holding Company, anaffiliate of Citigroup Venture Capital Ltd., or CVC, and CVC European EquityPartners, L.P. and CVC European Equity Partners (Jersey), L.P., whom we referto together as CVC Europe. At that time, we acquired the fabricated productsbusiness from Alumax Inc.  Alumax Inc.was acquired by Aluminum Company of America in 1998, and is hereafter referredto as “Alumax”.  Including our historyas a division of Alumax, we have over 50 years of experience in the fabricationof aluminum products, and over the last 30 years we have developed additionalexpertise in areas such as steel, vinyl, copper and fiberglass fabrication. See“Important Transactions—Acquisition of Alumax’s Fabricated Products Business inSeptember 1996.” In 1999, Euramax was reorganized to become a U.S. basedmultinational group.  See “ImportantTransactions—The Reorganization”. As described in “Important Transactions –2003 Stock Transaction”, Citigroup Venture Capital Equity Partners, L.P., orCVCEP, an affiliate of CVC, subsequently acquired all of our common stockformerly held by CVC Europe.

 

3

----

 

**Business Strategy**

 

Ourstrategy is to expand our leadership position as a producer of aluminum andsteel products and to further diversify product offerings, customers andgeographic regions in which we operate. Since our formation as an independentcompany in 1996, our ability to consistently generate free cash flow hasenabled us to pay down significant amounts of debt, while allowing us to pursuea strategy of improving our operations, profitability and prospects for futuregrowth. Under this strategy, we are pursuing organic growth through productdevelopment and the addition of new territories and new customers. In addition,our strategy includes identifying and acquiring businesses and assets that willenable us to offer complementary products and/or expand geographiccoverage.  Since our formation inSeptember 1996, we have completed eight acquisitions, including Berger Holdingsin November 2003, which have enabled us to offer complementary products andexpand our geographic coverage. We have also sold two businesses that did notserve our business strategy. We expect to continue identifying and acquiringbusinesses as part of executing our strategy.

 

**ImportantTransactions**

 

*Acquisitionof Alumax’s fabricated products business in September 1996.*Pursuantto a purchase agreement dated June 24, 1996, between Euramax InternationalLimited and Alumax, on September 25, 1996, Euramax International Limitedpurchased, through its wholly-owned subsidiaries, all of the issued andoutstanding capital stock of certain of Alumax’s subsidiaries which operated aportion of Alumax’s fabricated products business. The purchase price ofapproximately $252.4 million, including acquisition expenses of $3.9 millionand adjustments to give effect to certain items including cash acquired andworking capital, was allocated to the assets and liabilities of the Companybased upon their fair market value at the date of the acquisition under thepurchase method of accounting.

 

4

----

 

*The Reorganization.***In December 1999, Euramax International Limited completed areorganization whereby Euramax International, Inc., a Delaware corporation, waspositioned as the top tierholdingcompany. Prior to the Reorganization, the parent company was EuramaxInternational Limited (formerly Euramax International plc), a company organizedunder the laws of England and Wales. TheReorganization was accomplished, in part, by means of a “scheme of arrangement”under section 425 of the United Kingdom Companies Act 1985. As a result of theReorganization, the new U.S. holding company of the group, EuramaxInternational, Inc., is the reporting company for the consolidated group.

 

*2003 Stock Transaction. *On April 15, 2003, CitigroupVenture Capital Equity Partners, L.P., (“CVCEP”), and Citigroup Venture CapitalLtd., (“CVC”), entered into a definitive purchase agreement with CVC EuropeanEquity Partners, L.P. and CVC European Equity Partners (Jersey), L.P.,collectively (“CVC Europe”), BNP Paribas, independent directors and certainmembers of management to purchase, for approximately $106.0 million, all of theshares of the Company held by CVC Europe and BNP Paribas, and a portion of theshares held by independent directors and management, (“2003 StockTransaction”). The 2003 Stock Transaction was completed on June 12, 2003, withCVCEP purchasing 265,762.48 shares of the Company’s Class A common stock. Foraccounting purposes, the Company has used May 23, 2003, its May month-end, asthe transaction date. After the completion of this transaction CVCEP and CVCcollectively owned approximately 88.5% of the issued and outstanding shares ofthe Company, with management of CVCEP and directors and management of theCompany holding the remaining shares. Prior to the 2003 Stock Transaction, CVCowned approximately 34.5% of the issued and outstanding shares of the Company.CVCEP is ultimately controlled by Citigroup, Inc. through limited and generalpartnership interests owned by its subsidiaries. CVC Europe is a group oflimited partnerships in which Citigroup, Inc. owns a minority interest, butdoes not have management rights or control rights.

 

*Acquisitionof Berger Holdings, Ltd. on November 25, 2003.*OnNovember 18, 2003, pursuant to a tender offer, Amerimax Pennsylvania, Inc., awholly owned subsidiary of ours, acquired 93% of Berger Holdings’ outstandingcommon shares for $3.90 per share. The acquisition of Berger Holdings wascompleted on November 25, 2003 by the merger of Amerimax Pennsylvania, Inc.into Berger Holdings, with Berger Holdings as the survivor corporation. As aresult of the merger, each common share of Berger Holdings not owned by Euramaxwas converted into the right to receive $3.90 per share in cash, subject todissenters' rights.  The total purchaseprice of this acquisition was approximately $36.8 million. Berger Holdingsmanufactures metal roof drainage products and roofing accessories as well asresidential and commercial snow guards and is included in our U.S. FabricationRoof Drainage segment. We expect the acquisition of Berger Holdings to increaseour sales volume of roof drainage products to distributors and home improvementcontractors in addition to improving our competitiveness in this marketplace.

 

Thefollowing table lists certain other acquisitions we have completed since 1996.

 

5

----

 
| **Date**            |   | **Company**                            |   | **Rationale**                                                                                                                                                                                                                                                                    |
|---------------------|--------|----------------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| March 1997     |   | JTJ Laminating                         |   | •      Expand presence in the lamination of  fiberglass

•      Increase market share in laminated  fiberglass RV exteriors                                                                                          |
|                |   |                                   |   |                                                                                                                                                                                                                                                                             |
| July 1997           |   | Fabral                                 |   | •      Expand presence in the manufacture and  distribution of steel and aluminum roofing and wall paneling products to the  agricultural, commercial and industrial markets                                                                       |
|                |   |                                   |   |                                                                                                                                                                                                                                                                             |
| February 1999  |   | Unimet Manufacturing                   |   | •      Expand presence in the mid-Atlantic  region

•      Improve competitiveness                                                                                                                                   |
|                |   |                                   |   |                                                                                                                                                                                                                                                                             |
| April 1999     |   | Color Clad plc                         |   | •      Expand presence in the manufacture of RV  exteriors sold primarily to OEMs

•      Improve competitiveness                                                                                                    |
|                |   |                                   |   |                                                                                                                                                                                                                                                                             |
| June 1999           |   | Atlanta Metal Products                 |   | •      Expand product offering in roof drainage  products to home improvement contractors and distributors

•      Provide outlet for other existing  product lines to home improvement contractors and distributors |
|                |   |                                   |   |                                                                                                                                                                                                                                                                             |
| April 2000          |   | Gutterworld and Global Expanded Metals |   | •     Expand  product offering in roof drainage products                                                                                                                                                                                                |

 

**OperatingSegments**

 

Our acquisition ofBerger Holdings, Ltd. on November 25, 2003 led to an assessment of operatingsegments that resulted in our identification of the U.S. Fabrication RoofDrainage operating segment. The business activities in the U.S. FabricationRoof Drainage operating segment were previously included in the U.S.Fabrication segment. Our reporting segments are as follows:

 

*EuropeanRoll Coating* – The European Roll Coating facilities primarilyroll coat aluminum and steel sheet and coil for RV manufacturers,transportation manufacturers and building panel manufacturers.

 

*U.S.Fabrication Roof Drainage* – The U.S. Fabrication RoofDrainage facilities primarily fabricate coated aluminum and steel coil toproduce gutters, downspouts, soffit, fascia, gutter accessories and otherproducts. Such products are primarily sold to home centers, distributors andhome improvement contractors.

 

*U.S.Fabrication Building Materials* – The U.S. Building Materialsfacilities primarily fabricate coated aluminum and steel coil to produceroofing and siding panels, doors, windows, vehicle sidewalls and otherproducts. Such products are primarily sold to RV manufacturers, ruralcontractors, home improvement contractors, industrial and architecturalcontractors and manufactured housing producers.

 

*EuropeanFabrication* – The European Fabrication facilities primarilyfabricate aluminum extrusions and glass to produce windows, doors, showerenclosures, sunroofs and other products. Such products are primarily sold totransporation manufacturers, distributors, home centers and industrial andarchitectural contactors.

 

Financial information and other disclosures relating to our operatingsegments are provided in Note 15 of our consolidated financial statements.  See also, “Products and Customers.”

 

6

----

 

**ManufacturingProcesses**

 

Our manufacturing processes employ a variety of equipment and severaltypes of facilities. We believe that our deployment of equipment enables us tomanufacture standard and custom products efficiently and economically. We havethe equipment necessary for processing substantially all of our products in-house,which minimizes reliance on third party processors. This provides certain costbenefits while enabling us to add new products on a timely basis. Thesecapabilities provide marketing and pricing advantages, including the ability tocontrol delivery time and to develop new and customer-specific products in anexpeditious manner.

 

Our manufacturing process generally begins with painting aluminum orsteel coil through a process known as roll coating. Once coated, the aluminumor steel is further fabricated through selected processes which include tensionleveling, embossing, slitting, rollforming, brake pressing, notching andbending. These processes complete the appropriate steps to fabricate a finishedproduct.

 

Our coating and fabrication capabilities are described in more detail asfollows:

 

*Coating(painting and anodizing):*Rollcoating is the process of applying a variety of liquid coatings (primarilypaint) to bare aluminum or steel coil, providing a baked-on finish thatis both protective and decorative. Approximately 153 million pounds of aluminum(79 million pounds in Europe and 74 million pounds in the U.S.) andapproximately 27 million pounds of steel (9 million pounds in Europe and 18million pounds in the U.S.) were roll coated by our eight roll coatingoperations in 2003. We have three such coating lines in the U.S. and five inEurope. The three coating lines in the U.S. are primarily utilized for internalprocessing, while the five coating lines in Europe, located within twofacilities, are utilized to supply roll coated products to both internal andexternal customers. We believe that our roll coating facility in Roermond, TheNetherlands is one of only three facilities in the world capable of coatingcoil up to 100 inches in width. The Roermond line services a variety of marketsin which wide coated aluminum is becoming increasingly important. Wide coilsprovide customers with the opportunity to produce products more economically byreducing labor costs and requiring fewer joints and seams in theirmanufacturing processes.

 

Anodizing is an electrochemical process that alters an aluminum surfacethrough a controlled and accelerated oxidation process, which, if desired, mayalso color the material. Anodizing provides a high quality architectural finishto aluminum extrusions, which is demanded by certain customers. Anodizing is akey manufacturing process we offer in certain European facilities included inthe European Fabrication segment, which fabricate bath and shower enclosures,automotive window trims, and extrusions used in the transportation industry.

 

*Fabrication:* After coating, much of the coil, in our U.S.Fabrication Roof Drainage, U.S. Fabrication Building Materials and EuropeanFabrication segments, is processed through slitting operations which cut coilsinto more narrow widths. The cut coils may then undergo a variety of downstreamproduction processes which further fabricate the aluminum and steel sheet toform the desired product. Fabrication equipment includes rollformers, punch andbrake presses and expanding machinery for a variety of applications. Productionmachinery also includes equipment to bend, notch and cut aluminum and vinylextrusions required, together with glass, for the assembly of windows anddoors.

 

**Products andCustomers**

 

Our products are sold to a diverse group of customers operating in avariety of industries. Our sales and marketing effort is organized on adecentralized basis to provide required services to our broad customer base inmultiple geographic areas. Customers include:

 

•                  Original Equipment Manufacturers (“OEMs”)including RV, Commercial Panel, and Transportation Industry Manufacturers;

•                  Rural Contractors;

•                  Home Centers;

•                  Home Improvement Contractors;

 

7

----

 

•                  Distributors;

•                  Manufactured Housing Producers; and

•                  Industrial and Architectural Contractors.

 

8

----

 

The table below lists the Company’s key products, materials used,customers and end-users, sales regions and segments:

 
| **Products**                                                                |   | **Primary  Materials**             |   | **Customers/Markets**                                                                                                                                             |   | **Primary Sales  Regions** |   | **Segments**                                                                   |
|-----------------------------------------------------------------------------|--------|------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------|--------|--------------------------------------------------------------------------------|
|                                                                        |   |                               |   |                                                                                                                                                              |   |                       |   |                                                                           |
| Specialty Coated Coils(painted  aluminum andsteel coils)                    |   | Aluminum, Steel                    |   | OEMs, RV Manufacturers,  Transportation Industry Manufacturers, Various Building Panel Manufacturers                                                              |   | Europe                     |   | European RollCoating                                                           |
|                                                                        |   |                               |   |                                                                                                                                                              |   |                       |   |                                                                           |
| Roofing &  Siding (includingvehicle  sidewalls andbuilding panels) |   | Aluminum, Steel, Vinyl, Fiberglass |   | OEMs, RV Manufacturers, Rural Contractors,  Distributors, Industrial and Architectural Contractors, Home Improvement  Contractors; Manufactured Housing Producers |   | U.S., Europe               |   | U.S. Fabrication Building Materials,EuropeanFabrication, European Roll Coating |
|                                                                        |   |                               |   |                                                                                                                                                              |   |                       |   |                                                                           |
| Raincarrying Systems(gutters,  downspouts)                                  |   | Aluminum, Steel, Vinyl, Copper     |   | Home Centers, Rural Contractors,  Home Improvement Contractors, Distributors, Manufactured Housing Producers                                                      |   | U.S.                       |   | U.S. Fabrication Roof Drainage                                                 |
|                                                                        |   |                               |   |                                                                                                                                                              |   |                       |   |                                                                           |
| Soffit (roof overhangs),Fascia  (trims), Flashing(roofing valley  material) |   | Aluminum, Steel, Copper            |   | Home Centers, Rural Contractors,  Industrial and Architectural Contractors, Home Improvement Contractors,  Manufactured Housing Producers                         |   | U.S.                       |   | U.S. FabricationRoof Drainage                                                  |
|                                                                        |   |                               |   |                                                                                                                                                              |   |                       |   |                                                                           |
| Doors                                                                       |   | Aluminum, Fiberglass               |   | OEMs, RV Manufacturers,  Distributors, Home Centers, Home Improvement Contractors, Manufactured  Housing Producers                                                |   | U.S., Europe               |   | U.S. Fabrication Building  Materials,EuropeanFabrication                       |
|                                                                        |   |                               |   |                                                                                                                                                              |   |                       |   |                                                                           |
| Windows                                                                     |   | Aluminum, Vinyl                    |   | OEMs, RV Manufacturers, Home  Improvement Contractors, Transportation Industry Manufacturers                                                                      |   | U.S., Europe               |   | U.S. Fabrication  Building Materials, EuropeanFabrication                 |

 

9

----

 

The following table setsforth the percentage of our net sales attributable to our customers/markets:

 
|                                      |   | **Years Ended**  |   |
|-------------------------------------------|--------|------------------|--------|
|                                      |   | **December 26,** |   | **December 27,** |   | **December 28,** |   |
|                                      |   | **2003**         |   | **2002** |   | **2001** |   |
|                                      |   |             |   |   |   |   |   |
| OEMs                                      |   | 41.2             | %      | 41.4 | % | 40.7 | % |
| Home Centers                              |   | 21.8             | %      | 20.3 | % | 22.0 | % |
| Rural  Contractors                        |   | 16.8             | %      | 20.5 | % | 20.3 | % |
| Home Improvement  Contractors             |   | 8.2              | %      | 8.1 | % | 7.5 | % |
| Distributors                              |   | 5.6              | %      | 4.0 | % | 2.4 | % |
| Industrial and  Architectural Contractors |   | 3.6              | %      | 2.7 | % | 3.0 | % |
| Manufactured  Housing Producers           |   | 2.8              | %      | 3.0 | % | 4.1 | % |
|                                      |   | 100.0            | %      | 100.0 | % | 100.0 | % |

 

***Original Equipment Manufacturers******.***We supplyOEMs, such as RV, commercial panel and transportation industry manufacturers.The Company’s principal OEM customers are described below:

 

*RecreationalVehicle Manufacturers*:**Weare a leading supplier of various aluminum products to RV manufacturers inthe U.S. and Europe. These products primarily consist of painted aluminum sheetand fabricated painted aluminum panels. We use our decorative graphic coatinglines to produce aluminum panels with decorative detailing in a variety ofcolors. We also supply RV doors, windows and finished aluminum exteriorwalls and roofing panels. In addition, we supply laminated aluminum andfiberglass panels to RV manufacturers.

 

*CommercialPanel Manufacturers*:  We sell painted aluminum coil to customerswho produce commercial building panels. These panels become part of a totalpackage of commercial building wall panels and facades. The panels are used inboth residential (such as room additions and patio enclosures) andcommercial applications (such as service stations and school buildings) as wellas in the construction of “cold rooms” used for the storage of perishablegoods.

 

*Transportation IndustryManufacturers*: In addition to supplying RV manufacturers andcommercial panel manufacturers, we also supply manufacturers in thetransportation industry in Europe with windows, sunroofs, frames and variousother components fabricated from aluminum extrusions.

 

*OtherManufacturers*: We also useour decorative and coil coating capabilities for products supplied to overheaddoor manufacturers and producers of refrigerated transport containers. Doormanufacturers produce the overhead doors, adding the necessary hardware andaccessory items to complete the product.

 

10

----

 

***Home Centers.***Our home center customers supply the well-establishedDo-It-Yourself, or DIY, market in the U.S., Canada, and the U.K. In the U.S.,we sell building and construction products, such as residential rain-carryingsystems, roof flashing products, soffits, fascias, and steel roofing andsiding. In the U.K., we sell residential entry doors. These products, which aredesigned for ease of installation by DIY consumers, are produced withaluminum, galvanized or painted steel, and vinyl, depending on regionalpreferences. Home centers include small hardware stores, large cooperativebuying groups, lumberyards and major home center retailers. We believe that weare the leading supplier of DIY metal raincarrying systems in the U.S.

 

***Rural Contractors****.*We supplyaluminum and steel roofing and siding products to rural contractors for use inagricultural and rural buildings such as sheds and animal confinementbuildings. We sell our products to traditional rural contractors, includingbuilding supply dealers, building and agricultural cooperatives, and animalconfinement integrators. Building suppliers and agricultural cooperativestypically purchase smaller quantities of product at multiple locations whereascontractors and integrators generally purchase large volumes for delivery toone site.

 

***Home Improvement Contractors.***We sell a variety of products to home improvementcontractors, the most significant of which are vinyl replacement windows. Otherproducts sold to home improvement contractors include awnings, lattice systems,metal roofing, shower doors and patio and entrance doors. In the U.S., we offera full complement of vinyl replacement windows. We are also one of thelargest suppliers of lattice and painted aluminum awnings to residentialcontractors in the western U.S. In addition,we manufacture painted aluminum and steel panels for residential roofing.

 

***Distributors.***We sell to distributors and stockists (theEuropean equivalent of distributors), which perform as service centers for thenext tier of customers in both the U.S. and Europe. A distributor willtypically purchase coil which is later broken down or fabricated prior toresale. Residential building products sold through distributors include a widerange of metal roof flashing materials, painted aluminum trim coil,raincarrying systems, fascia/soffit systems and drip edges. In the U.K., weproduce patio, entrance and shower doors, marketed primarily to distributors,as well as shower and bath enclosures.

 

***Industrial and ArchitecturalContractors.***We sellvarious products to the architectural and industrial contractor marketsincluding standing seam panels, siding, soffits and fascias. These products areprimarily produced from galvanized steel or aluminum.

 

***Manufactured Housing Producers.***We sell fabricated steel siding and accessoryparts to producers of manufactured housing in the U.S. These products are usedfor exterior walls and roofs. While we enjoy a leading position in this market,recent trends show the annual amounts of steel siding sold to the manufacturedhousing industry to be declining. This is primarily due to the availability oflow-cost vinyl siding, which has aesthetic advantages over steel. To a lesserdegree, we also distribute vinyl siding to certain customers in themanufactured housing industry. In addition to steel siding, we also fabricateand supply a variety of steel and aluminum accessory components formanufactured home exteriors.

 

**Raw Materials**

 

Our products are principally manufactured from aluminum coils andextrusions and steel coils. During 2003, approximately 195 million poundsof aluminum products and approximately 268 million pounds of steel productswere sold. The proportion sold in 2003 by value is $433.9 million ofaluminum and $179.4 million of steel. Steel weighs approximately threetimes as much as the same volume of aluminum. In addition, during 2003, we sold$131.0 million of products manufactured from materials other than aluminum andsteel.

 

All of our raw material inputs are sourced from external suppliers. Wepurchase our steel and aluminum sheet requirements from several foreign anddomestic aluminum and steel mills. We believe there is sufficient supply in themarket place to competitively source all of our requirements without relianceon any particular supplier.

 

11

----

 

Approximately 58% and 24% of our net sales are derived from sales ofaluminum and steel products, respectively. Both of these raw materials are subject to a high degree of volatilitycaused by, among other items, the relationship of world supply to world demand,the relationship of the U.S. Dollar to other currencies, and the imposition ofimport and export tariffs. Historically, prices at which we sell aluminum andsteel products tend to fluctuate with corresponding changes in the prices paidto suppliers for these raw materials. Supplier price increases and decreasesare typically, but not always, due to competition and the market foralternative products, passed on to customers. Accordingly, our net sales andmargins attributable to aluminum and steel products may fluctuate with littleor no change in the volume of shipments.

 

**Competition**

 

Competition in theU.S. RV and manufactured housing markets comes primarily from one subsidiary ofa large publicly held U.S. building products company. Other competition in thismarket, and other U.S. markets, comes largely from privately and publicly heldcompanies that are generally smaller than we are. In Europe, our competitorsinclude three to four integrated companies in the specialty coil-coatingbusiness. Other smaller companies compete with us in the building andconstruction, RV and transportation markets in Europe, both on a regional basisand some on a pan-European basis.

 

**Environmental,Health and Safety Matters**

 

Our manufacturing facilities are subject to a range of federal, state,local and European environmental and occupational health and safety laws,including those which relate to air emissions, wastewater discharges, thehandling and disposal of solid and hazardous waste, and the remediation ofcontamination associated with the current and past use of hazardous substancesor materials. If a release of hazardous substances or materials occurs on orfrom our properties or any offsite disposal location used by us, or ifcontamination from prior activities is discovered at any of our properties, wemay be held liable for the costs of remediation (including any response costs),natural resource damages and associated transaction costs. While the amount ofsuch liability could be material, we devote resources to ensure that our currentoperations are conducted in a manner intended to reduce such risks.

 

Based upon environmental reviews conducted internally on a quarterlybasis, by outside consultants on a periodic basis, and by outside consultantsin connection with the acquisition of Alumax’s fabricated products business,and assuming compliance by Alumax with its indemnification obligations underthe related acquisition agreement, we believe that we are currently incompliance with, and not subject to liability under, environmental laws exceptwhere such noncompliance or liability would not reasonably be expected to havea material adverse effect on our consolidated financial position, results ofoperations or cash flows. Pursuant to the terms of the Alumax acquisitionagreement, Alumax agreed to correct and to bear substantially all costs withrespect to certain identified conditions of potential noncompliance andliability under environmental laws, none of which costs is currently believedto be material. Alumax’s indemnification obligations under the acquisitionagreement are not subject to an aggregate dollar limitation and surviveindefinitely with respect to specifically identified environmental matters.

 

Liability with respect tohazardous substance or material releases in the U.S. arises principally underthe federal

 

12

----

 

Comprehensive EnvironmentalResponse, Compensation, and Liability Act of 1980, as amended, or CERCLA, andsimilar state laws, which impose strict, and under certain circumstances,retroactive, joint and several liability upon statutorily defined classes ofpotentially responsible parties, or PRPs. We have been identified as a PRP ateleven National Priorities List, or NPL, sites under CERCLA, although two ofthese eleven sites may relate to disposal by divisions of Alumax that havenever been and are not now part of Euramax. Pursuant to the terms of the Alumaxacquisition agreement, Alumax has agreed to indemnify us for all of the costsassociated with each of these eleven NPL sites. In addition, Alumax has agreedto indemnify us for all of the costs associated with nine additional siteslisted on state hazardous site cleanup lists, with respect to which we have notreceived any notice of potential responsibility.

 

At our Corby, England facility,Legionella was found to be present on site in a cooling tower. An independenttesting laboratory is testing water samples for the presence of Legionella on aweekly basis, and no further evidence of Legionella has been detected to date.Based upon the investigation, we believe that the reasonable likely outcome ofthis matter will not materially impact our future consolidated financialposition, results of operations, or cash flows.

 

The facility that Berger leases inIvyland, Pennsylvania has contaminated groundwater as a result of the migrationfrom an adjacent property which was formerly the Naval Air Warfare Center,currently an NPL site under CERCLA. The United States Navy is conducting aclean-up of the Naval Air Warfare Center NPL site under the EnvironmentalProtection Agency’s supervision. The owner/landlord of the Berger propertyobtained liability protection under Pennsylvania’s Brownfield Law bydemonstrating to the Commonwealth of Pennsylvania that the contamination isfrom an off-site source, and under Pennsylvania law, that protection benefitstenants as well. Moreover, under Berger’s lease, the landlord retained anyliability for this contamination. Accordingly, although the facility leased byBerger is on an NPL site, the effects of this contamination would notreasonably be expected to have a material adverse effect on our consolidatedfinancial position, results of operations or cash flows.

 

We have made and will continue to make capital expenditures to complywith environmental laws. Environmental capital expenditures for the years endedDecember 26, 2003, December 27, 2002 and December 28, 2001 were approximately$143.1 thousand, $212.1 thousand and $581.8 thousand, respectively. We estimatethat our environmental capital expenditures will be approximately $500.0thousand in 2004.

 

**Employees**

 

We employ approximately 2,600 people of which 1,000 are employed inEurope and 1,600 are employed in the U.S. Of these employees, approximately 30%are salaried and 70% are hourly employees. Collective bargaining agreementscover approximately 220 manufacturing employees at five of our U.S.manufacturing facilities. We are not a party to any material pending laborproceedings and believe that employee relations are good.

 

**Risk Factors**

 

**Our substantialindebtedness could adversely affect our financial condition and prevent us frommaking principal and interest payments on our indebtedness.**

 

As of December 26, 2003, we had $36.6 million outstanding under the termloan portion of our senior secured credit facility, with $110.0 million undrawnunder the revolving credit facility, of which $100.8 million was available dueto borrowing base limitations. In addition, we expect to borrow all orsubstantially all of the funds necessary to fund the anticipated stockrepurchase of 169,680.62 shares of our common stock from Court Square Limitedfor an aggregate repurchase price of approximately $67.9 million, under therevolving credit facility, with the balance to be derived from cash on hand.This stock repurchase transaction is subject to restrictions contained in theindenture governing the senior subordinated notes and our senior secured creditfacility. Our highly leveraged position poses substantial risk to holders ofthe senior subordinated notes, including risks that:

 

•                  a substantial portion of our cash flow fromoperations will be dedicated to the payment of interest on the seniorsubordinated notes and the payment of principal and interest under our seniorsecured credit facility;

•                  our highly leveraged position may impede ourability to obtain financing in the future for working capital, capitalexpenditures and general corporate purposes, including acquisitions; and

 

13

----

 

•                  our highly leveraged financial position may makeus more vulnerable to economic downturns and may limit our ability to withstandcompetitive pressures.

 

Our future cash flow may not be sufficient to meet our obligations andcommitments. In addition, all borrowings under our senior secured creditfacility will become due prior to the senior subordinated notes. If we areunable to generate sufficient cash flow from operations in the future toservice our indebtedness and to meet our other commitments, we will be requiredto adopt one or more alternatives, such as refinancing or restructuring ourindebtedness, selling material assets or operations or seeking to raiseadditional debt or equity capital. There can be no assurance that any of theseactions could be effected on a timely basis or on satisfactory terms or thatthese actions would enable us to continue to satisfy our capital requirements.In addition, the terms of our existing or future debt agreements, including oursenior secured credit facility and the senior subordinated notes, may prohibitus from adopting any of these alternatives.

 

**Despite currentindebtedness levels and restrictive covenants, we may still be able to incursubstantial additional debt, which could exacerbate the risks associated withour substantial leverage.**

 

We may be able to incur additional debt in the future, including debtthat is senior to or equal in right of payment to the senior subordinatednotes. In particular, we expect to borrow all or substantially all of the fundsnecessary to fund the anticipated stock repurchase under our senior securedcredit facility, with the balance to be derived from cash on hand. Although theindenture governing the senior subordinated notes and our senior secured creditfacility contain restrictions on our ability to incur indebtedness, thoserestrictions are subject to a number of exceptions. We can borrow up to $145.0million under our senior secured credit facility, all of which would ranksenior to the senior subordinated notes. The indenture permits us to incur atleast $175.0 million in indebtedness that could be senior to the indebtednessunder the senior subordinated notes. This consists of $150.0 million of creditfacility debt, which would be senior to the indebtedness under the senior subordinatednotes to the extent incurred. We and our restricted subsidiaries may also incurin the aggregate an additional $25.0 million under the indenture at any time.This indebtedness may be senior to or equal in right of payment with the seniorsubordinated notes. To the extent it is incurred by non-guarantor subsidiaries,even if not senior by its terms, it may be effectively senior to theindebtedness under the senior subordinated notes. We can also incur additionalindebtedness that could be senior indebtedness to the extent that, afterincurring such debt, we would have a Consolidated Cash Flow Ratio (as definedin the indenture) of greater than 2.0 to 1.0. In addition, if we are able todesignate some of our restricted subsidiaries under the indenture governing thesenior subordinated notes as unrestricted subsidiaries, those unrestrictedsubsidiaries would be permitted to borrow beyond the limitations specified inthe indenture and engage in other activities in which restricted subsidiariesmay not engage. Adding new debt to current debt levels could intensify therelated risks that we and our subsidiaries now face.

 

**Our acquisitionstrategy may not be successful and may adversely affect our earnings fromoperations.**

 

We have engaged in and continue to engage in evaluations of anddiscussions with potential acquisition candidates. These acquisitions may befinanced by incurring additional indebtedness, which could be material. Suchadditional indebtedness may increase our leverage ratios substantially or adverselyimpact our ratings from any ratings agencies. We have completed the acquisitionof Berger Holdings, and our leverage ratio has increased as a result. Inaddition, our failure to integrate any acquired businesses successfully mayadversely affect our earnings from operations. Any such transactions would besubject to negotiations of definitive agreements, satisfactory financingarrangements (including compliance with the limitations on issuance ofindebtedness in the indenture governing the senior subordinated notes and inour senior secured credit facility) and applicable governmental approvals andconsents. We may not complete any additional acquisitions and any acquiredentities or assets may not enhance our results of operations.

 

**Demand for manyof our products is cyclical.**

 

Demand for many of our products is cyclical in nature. Changes ingeneral economic conditions can affect market demand for our products. Sales tothe building and construction markets are driven by trends in commercial and residentialconstruction, housing starts, residential repair and remodelings.Transportation market sales are also cyclical in nature and typically followthe trends in the automotive, truck and recreational vehicle manufacturingindustries. Historically, lower

 

14

----

 

demand has led to lower margins, lower production levels, or both.

 

**We depend uponaluminum and price fluctuations or supply disruption could harm our results.**

 

Our primary raw material is aluminum coil. We sold approximately $433.9million of aluminum products in 2003. Because changes in aluminum prices aregenerally passed through to our customers, increases or decreases in aluminumprices generally cause corresponding increases and decreases in reported netsales, causing fluctuations in reported revenues that are unrelated to thelevel of business activity. However, if we are unable to pass through aluminumprice changes to our customers in the future, we could be materially adverselyaffected. Any major dislocation in the supply and/or price of aluminum couldhave a material adverse effect on our business and financial condition.Further, we are subject to the short-term commodity risk of carryingaluminum in our inventory. See “Management’s Discussion and Analysis ofFinancial Condition and Results of Operations.”

 

**We depend uponsteel, and price fluctuations or supply disruption could harm our results.**

 

We sold approximately $179.4 million of steel products in 2003. Wepurchase a majority of our steel raw materials from domestic steel producers.As with aluminum, changes in steel prices are generally passed through to ourcustomers, and increases or decreases in steel prices generally causecorresponding increases and decreases in reported net sales, causingfluctuations in reported revenues that are unrelated to the level of businessactivity. However, if we are unable to pass through steel price changes to ourcustomers in the future, we could be materially adversely affected. Anydisruption in the supply and/or change in price of steel could have a materialadverse effect on our business and financial condition.

 

We have no long-term contracts with any supplier of steel. While weexpect that there will be an adequate supply to meet our demand for steel rawmaterials, there may not be an adequate supply. Therefore, we are subject tothe risk of lost revenue in the event that we cannot obtain quantities of steelnecessary to meet customer demand.

 

**Indebtednessunder our senior secured credit facility is subject to floating interest rates,which may cause our interest expense to increase.**

 

Changes in economic conditions could result in higher interest rates,thereby increasing our interest expense and reducing our funds available foroperations and other purposes. A 1% increase in market interest rates wouldresult in an annual increase in our interest expense and a decrease in ourearnings before income taxes, of approximately $0.4 million. Any borrowingsunder the revolving portion of our credit facility would be subject to similarfluctuations.

 

**Our seniorsecured credit facility and the indenture for the senior subordinated notescontain covenant restrictions that limit our flexibility in operating ourbusiness and our ability to repay our indebtedness.**

 

Our senior secured credit facility and the indenture relating to thesenior subordinated notes contain a number of restrictive covenants that imposesignificant restrictions on us. Compliance with these restrictive covenantslimits our flexibility in operating our business. Failure to comply with thesecovenants could give rise to an event of default. These covenants

 

15

----

 

restrict, among other things, our ability to:

•                  incur indebtedness;

•                  make certain restricted payments;

•                  pay certain dividends, make certain distributions,make loans and transfer property;

•                  incur liens;

•                  sell assets;

•                  issue or sell capital stock;

•                  enter into transactions with affiliates; and

•                  consolidate, merge or sell all or substantiallyall of our assets.

 

Our senior secured credit facility also contains financial covenants. Ifwe default on any of these covenants, the lenders could cause all amountsoutstanding under our senior secured credit facility and the senior subordinatednotes to be due and payable immediately, and the lenders under our seniorsecured credit facility could proceed against any collateral securing thatindebtedness. Our assets or cash flow may not be sufficient to repay in fullthe borrowings under our senior secured credit facility or the seniorsubordinated notes, either upon maturity or if accelerated upon an event ofdefault. In addition, any event of default or declaration of acceleration underone debt instrument could also result in an event of default under one or moreof our other debt instruments. We currently pledge, and expect to continue topledge, a significant portion of our assets as collateral under our seniorsecured credit facility. If the lenders under our senior secured credit facilityor the holders of the senior subordinated notes accelerate the repayment ofborrowings, we may not have sufficient assets to repay our indebtedness,including the senior subordinated notes.

 

**We are subjectto risk of currency exchange rate fluctuations which may adversely affect ourresults of operations and our ability to make principal and interest paymentson the senior subordinated notes.**

 

In 2003, approximately 35% of our net sales were made outside the UnitedStates. The U.S. Dollar value of our non-U.S. sales varies with currencyexchange rate fluctuations. Changes in currency exchange rates could have anadverse effect on our results of operations and our ability to meet interestand principal obligations on the senior subordinated notes. Utilizing currencyswaps, we have historically converted portions of U.S. Dollar obligationsserviced by foreign operations into an equivalent obligation denominated inlocal currencies. We expect to continue this practice to hedge against adverseexchange rate fluctuations that would limit our ability to meet interest andprincipal obligations on the portion of the senior subordinated notes to beserviced by foreign operations. We do not employ activities or enter intotransactions that are intended to hedge the impact of exchange ratefluctuations on our results of operations.

 

**We are subjectto strict environmental regulations that may lead to significant, unforeseenexpenses.**

 

Our U.S. and European facilities are subject to the requirements offederal, state, local and European environmental and occupational health andsafety laws and regulations. We may not be, at all times, in compliance withall such requirements. We have made and will continue to make capitalexpenditures to comply with environmental requirements. As is the case withmanufacturers in general, if a release of hazardous substances occurs on orfrom our properties or any offsite disposal location used by us, or ifcontamination from prior activities is discovered at any of our properties, wemay be held liable for cleanup costs, natural resource damages and associatedtransaction costs.  While we do notbelieve the costs of remediation of identified environmental matters to bematerial, the amount of such liability could be material. We have been named aparty potentially responsible for the costs of investigating and remediatingnine waste disposal sites, pursuant to the federal Comprehensive EnvironmentalResponse, Compensation, and Liability Act of 1990, and one of our leasedfacilities is located on an NPL which is the responsibility of, and is beingcleaned up by, an unrelated third party. See “Business – Environmental,Health and Safety Matters” and “Management’s Discussion and Analysis ofFinancial Condition and Results of Operations – Environmental Matters.”

 

16

----

 

**We depend on ourmanagement and key personnel, the loss of which could materially harm us.**

 

Our success and our ability to implement our business strategy dependsupon the continued contributions of key management, engineering, sales andmarketing, finance and manufacturing personnel. The loss of the services ofcertain of these executives could have a material adverse effect on our resultsof operations and prospects. We currently do not maintain “key man” insuranceon any members of our management or other key personnel. We may not be able toretain such key personnel or to attract additional qualified personnel.

 

**We operate inhighly competitive markets and may not be able to compete effectively.**

 

The markets in which we compete are highly competitive. In the UnitedStates, competition comes from both large and small publicly held and privatelyheld companies. In Europe, our competitors include three to four integratedcompanies in the specialty coil coating business. Other smaller companiescompete with us in the building and construction, RV and transportation marketsin Europe, both on a regional basis and some on a pan-European basis. Wemay not be able to compete effectively in any of our markets in the future.

 

**We could facepotential product liability or warranty claims relating to products wemanufacture or distribute, and we may not have sufficient insurance coverage orfunds available to cover all potential claims.**

 

We face a business risk of exposure to product liability claims in theevent that the use of our products is alleged to have resulted in injury orother adverse effect. We currently maintain product liability coverage, but wemay not be able to obtain such insurance on acceptable terms in the future, ifat all, or any such insurance may not provide adequate coverage againstpotential claims. Product liability claims can be expensive to defend and maydivert management or other personnel for months or years regardless of theultimate outcome. An unsuccessful product liability defense could have amaterial adverse effect on our business, financial condition, result ofoperations or business prospects. We may also experience increased costs ofwarranty claims if our products are manufactured or designed defectively.

 

**We arecontrolled by our principal stockholders whose interests may conflict with theinterests of the holders of the senior subordinated notes.**

 

CVCEP beneficially owns approximately 54% of our common stock. CourtSquare Capital Limited, or Court Square, is an affiliate under common controlwith CVCEP and owns an additional 34.5% of our common stock as of December 26,2003. Collectively, CVCEP and Court Square control the affairs and policies ofour company.  As discussed in“Management's Discussion and Analysis of Financial Condition and Results ofOperations—Liquidity and Capital Resources”, we expect on or beforeApril 30, 2004 to repurchase all of our outstanding common stock held byCourt Square.  Once the anticipatedstock repurchase is completed, Court Square will not own any shares of ourcommon stock and CVCEP will own approximately 81% of our common stock.  CVCEP will control the affairs and policiesof our company. Circumstances may occur in which the interests of thesestockholders could be in conflict with the interests of the holders of thesenior subordinated notes. These stockholders may also have an interest inpursuing acquisitions, divestitures or other transactions, including a mergeror a sale of all or substantially all of our assets, that in their judgment,could enhance their equity investment, even though such transactions mightinvolve risks to the holders of the senior subordinated notes. Similarly, theymay prefer to increase our indebtedness to fund acquisitions or capitalexpenditures at a time when holders of our debt instruments would prefer us notto increase our debt levels. They may also prefer that excess cash flow orborrowings under our revolving credit facility be used to pay dividends orrepurchase some of our outstanding stock.

 

17

----

 

**Item 2.  Facilities and Properties**

 

Our principal executive office and headquarters are located in Norcross,Georgia. Our principal facilities are listed below by operating segment:

 
| **Facility**                            |   | **Function**              |   | **Square Feet**       |   |
|-----------------------------------------|--------|---------------------------|--------|-----------------------|--------|
| Norcross, GA                            |   | Executive  Offices        |   | (Leased)              |   | 3,627 |   |
| **U.S. Fabrication Roof Drainage**      |   |                      |   |                  |   |   |   |
| Atlanta, GA                             |   | Office  and Manufacturing |   | (Leased)              |   | 132,250 |   |
| Atlanta, GA                             |   | Manufacturing             |   | (Leased)              |   | 10,500 |   |
| Atlanta, GA                             |   | Manufacturing             |   | (Leased)              |   | 13,000 |   |
| Feasterville, PA                        |   | Office  and Manufacturing |   | (Owned)               |   | 120,000 |   |
| Grand Prairie, TX                       |   | Manufacturing             |   | (Leased)              |   | 45,281 |   |
| Ivyland, PA                             |   | Manufacturing             |   | (Leased)              |   | 105,000 |   |
| Keller, TX                              |   | Manufacturing             |   | (Leased)              |   | 29,605 |   |
| Kennesaw, GA                            |   | Manufacturing             |   | (Owned)               |   | 10,000 |   |
| Lancaster, PA                           |   | Office  and Manufacturing |   | (Owned)               |   | 220,000 |   |
| Lancaster, PA                           |   | Warehouse                 |   | (Leased)              |   | 43,000 |   |
| Lawrenceville, GA                       |   | Manufacturing             |   | (Leased)              |   | 55,000 |   |
| Mableton, GA                            |   | Manufacturing             |   | (Owned)               |   | 88,000 |   |
| Romeoville, IL                          |   | Manufacturing             |   | (Leased)              |   | 109,000 |   |
| West Sacramento, CA                     |   | Manufacturing             |   | (Leased)              |   | 70,000 |   |
| **U.S. Fabrication Building Materials** |   |                      |   |                  |   |   |   |
| Anaheim, CA                             |   | Manufacturing             |   | (Leased)              |   | 15,000 |   |
| Bloomsburg, PA                          |   | Manufacturing             |   | (Leased)              |   | 96,000 |   |
| Bristol, IN                             |   | Manufacturing             |   | (Owned)               |   | 110,115 |   |
| Cedar City, UT                          |   | Manufacturing             |   | (Leased)              |   | 38,000 |   |
| Dallas, TX                              |   | Office                    |   | (Leased)              |   | 12,400 |   |
| Denver, CO                              |   | Warehouse                 |   | (Leased)              |   | 5,000 |   |
| Elkhart, IN                             |   | Manufacturing             |   | (Leased)              |   | 65,000 |   |
| Elkhart, IN                             |   | Manufacturing             |   | (Leased)              |   | 96,000 |   |
| Gridley, IL                             |   | Manufacturing             |   | (Owned)               |   | 93,200 |   |
| Idabel, OK                              |   | Manufacturing             |   | (Owned)               |   | 37,440 |   |
| Jackson, GA                             |   | Manufacturing             |   | (Owned)               |   | 69,450 |   |
| Lancaster, PA                           |   | Office  and Manufacturing |   | (Owned)               |   | 126,083 |   |
| Las Vegas, NV                           |   | Warehouse                 |   | (Leased)              |   | 28,500 |   |
| Loveland, CO                            |   | Manufacturing             |   | (Leased)              |   | 51,362 |   |
| Mansfield, TX                           |   | Manufacturing             |   | (Owned)               |   | 55,280 |   |
| Marshfield, WI                          |   | Manufacturing             |   | (Owned)               |   | 28,200 |   |
| Rathdrum, ID                            |   | Manufacturing             |   | (Leased)              |   | 26,190 |   |
| Romoland, CA                            |   | Manufacturing             |   | (Owned)               |   | 65,500 |   |
| Sacramento, CA                          |   | Manufacturing             |   | (Leased)              |   | 40,800 |   |
| Sacramento, CA                          |   | Manufacturing             |   | (Leased)              |   | 40,000 |   |
| Stayton, OR                             |   | Manufacturing             |   | (Leased)              |   | 35,733 |   |
| Tifton, GA                              |   | Manufacturing             |   | (Leased)              |   | 55,600 |   |
| Tifton, GA                              |   | Manufacturing             |   | (Leased)              |   | 26,934 |   |
| West Helena, AR                         |   | Manufacturing             |   | (Owned)               |   | 230,000 |   |
| **European Roll Coating**               |   |                      |   |                  |   |   |   |
| Corby, England                          |   | Office  and Manufacturing |   | (Owned)               |   | 171,000 |   |
| Roermond, The Netherlands               |   | Office  and Manufacturing |   | (Owned)               |   | 208,216 |   |
| **European Fabrication**                |   |                      |   |                  |   |   |   |
| Pudsey, England                         |   | Office  and Manufacturing |   | (Owned  & Leased) |   | 211,200 |   |
| Leeds, England                          |   | Manufacturing             |   | (Leased)              |   | 55,000 |   |
| Andrezieux-Boutheon, France             |   | Office  and Manufacturing |   | (Owned)               |   | 69,968 |   |
| Montreuil-Bellay, France                |   | Office  and Manufacturing |   | (Owned)               |   | 233,663 |   |

 

We believe that our facilities, taken as a whole, have adequateproductive capacity and sufficient manufacturing equipment to conduct businessat levels meeting current demand.

 

18

----

 

**Item 3.**  **LegalProceedings**

 

We are not currentlyparties to any pending legal proceedings other than such proceedings occurringin the ordinary course of business. We believe that such proceedings would not,individually or in the aggregate, reasonably be expected to have a materialadverse effect on our consolidated financial position, results of operations orcash flows.

 

**Item 4.**  **Submissionof Matters to a Vote of Security Holders**

 

There were no items submitted for vote of security holders in thequarter ended December 26, 2003.

 

**Part II**

 

**Item 5.  Market for Registrant’s Common Equity andRelated Stockholders Matters**

 

The Company issued $200.0 million senior subordinated notes in August2003 that were subsequently registered under the Securities Act of 1933 inMarch 2004.

 

There is no established public trading market for any class of commonequity of the Company. As of March 15, 2004, there were 32 holders of record ofthe Company’s 492,495.79 outstanding shares of common stock.

 

Our amended and restated senior secured creditfacility and the indenture governing our senior subordinated notes containcertain restrictions on the payment of cash dividends.  See “Management’s Discussion and Analysis ofFinancial Condition and Results of Operations – Liquidity and CapitalResources.”

 

See "Item 10. Directors, Executive Officersand Key Management – Equity Compensation Plan Information" and "Item10.  Directors, Executive Officers andKey Management – 2003 Equity Compensation Plan" for information onsecurities authorized for issuance under equity compensation plans.

 

19

----

 

**Item 6.**  **SelectedHistorical Consolidated Financial Data**

 

The selected financial data as ofeach fiscal year end and for each fiscal year in the five year period endedDecember 26, 2003 were derived from our audited consolidated financialstatements.  The information containedin this table should be read in conjunction with “Management’s Discussion andAnalysis of Financial Condition and Results of Operations” and the ConsolidatedFinancial Statements and accompanying notes thereto included herein.

 
|                                               |   | **Predecessor**                        |    | **Successor**                                   |    | **Predecessor**                     |    |
|----------------------------------------------------|--------|----------------------------------------|---------|-------------------------------------------------|---------|-------------------------------------|---------|
| **Thousands of U.S. Dollars, except for ratios**   |   | **Five  months  ended  May 23,  2003** |    | **Seven  months  ended  December 26,  2003(4)** |    | **Year  ended  December 27,  2002** |    | **Year  ended  December 28,  2001** |   | **Year  ended  December 29,  2000** |   | **Year  ended  December 31,  1999** |   |
| **Statement of Earnings Data:**                    |   |                                   |    |                                            |    |                                |    |   |   |   |   |   |   |
| Net sales                                          |   | $                                      | 260,615 |                                            | $       | 483,688                             |    | $ | 639,149 |   | $ | 593,117 |   | $ | 599,479 |   | $ | 596,759 |   |
|                                               |   |                                   |    |                                            |    |                                |    |   |   |   |   |   |   |
| Costs and expenses:                                |   |                                   |    |                                            |    |                                |    |   |   |   |   |   |   |
| Cost of goods sold                                 |   | 208,420                                |    | 388,829                                         |    | 508,254                             |    | 477,870 |   | 494,330 |   | 479,730 |   |
| Selling and general                                |   | 26,153                                 |    | 49,649                                          |    | 63,593                              |    | 59,230 |   | 54,475 |   | 57,986 |   |
| Depreciation and amortization (3)                  |   | 6,276                                  |    | 10,639                                          |    | 13,968                              |    | 17,555 |   | 16,569 |   | 13,728 |   |
|                                               |   | 240,849                                |    | 449,117                                         |    | 585,815                             |    | 554,655 |   | 565,374 |   | 551,444 |   |
| Earnings from operations                           |   | 19,766                                 |    | 34,571                                          |    | 53,334                              |    | 38,462 |   | 34,105 |   | 45,315 |   |
|                                               |   |                                   |    |                                            |    |                                |    |   |   |   |   |   |   |
| Interest expense                                   |   | (9,294                                 | )       | (12,983                                         | )       | (23,034                             | )       | (25,727 | ) | (26,376 | ) | (22,369 | ) |
| Interest income                                    |   | 168                                    |    | 324                                             |    | 286                                 |    | 469 |   | 506 |   | 563 |   |
| Other income (expense)                             |   | 506                                    |    | (48                                             | )       | 703                                 |    | (2,953 | ) | 763 |   | (933 | ) |
| Earnings before income taxes                       |   | 11,146                                 |    | 21,864                                          |    | 31,289                              |    | 10,251 |   | 8,998 |   | 22,576 |   |
| Provision for income taxes                         |   | 4,254                                  |    | 7,108                                           |    | 11,432                              |    | 5,521 |   | 5,671 |   | 11,017 |   |
| Net earnings                                       |   | 6,892                                  |    | 14,756                                          |    | 19,857                              |    | 4,730 |   | 3,327 |   | 11,559 |   |
| Dividends on redeemable preference shares (2)      |   | —                                 |    | —                                          |    | —                              |    | — |   | — |   | 6,381 |   |
| Net earnings available for shareholders            |   | $                                      | 6,892   |                                            | $       | 14,756                              |    | $ | 19,857 |   | $ | 4,730 |   | $ | 3,327 |   | $ | 5,178 |   |
|                                               |   |                                   |    |                                            |    |                                |    |   |   |   |   |   |   |
| **Other Data:**                                    |   |                                   |    |                                            |    |                                |    |   |   |   |   |   |   |
| Capital expenditures                               |   | $                                      | 4,944   |                                            | $       | 5,129                               |    | $ | 8,263 |   | $ | 8,321 |   | $ | 9,706 |   | $ | 13,358 |   |
| Ratio of earnings to fixed charges (1)             |   | 2.08                                   | x  | 2.48                                            | x  | 2.24                                | x  | 1.37 | x  | 1.32 | x  | 1.92 | x  |
| **Balance Sheet Data (end of period):**            |   |                                   |    |                                            |    |                                |    |   |   |   |   |   |   |
| Working capital                                    |   |                                   |    | $                                               | 116,796 |                                | $       | 90,480 |   | $ | 70,049 |   | $ | 79,314 |   | $ | 90,570 |   |
| Total assets                                       |   |                                   |    | 608,829                                         |    | 416,440                             |    | 384,251 |   | 413,059 |   | 399,659 |   |
| Total long-term debt, including current maturities |   |                                   |    | 239,294                                         |    | 196,972                             |    | 207,724 |   | 235,528 |   | 221,279 |   |
| Total shareholders’ equity                    |   |                                   |    | 169,950                                         |    | 86,219                              |    | 61,494 |   | 63,781 |   | 65,068 |   |

 

----

(1)                                  Earningsused in computing the ratio of earnings to fixed charges consist of earningsbefore income taxes plus fixed charges. Fixed charges consist of interest expense, including amortization ofdebt issuance costs, and the estimated interest component of rent expense.

(2)                                  In December 1999, in connection with theReorganization, the 1,000,000 ordinary shares and 34,000,000 redeemablepreference shares, including accrued cumulative dividends, of EuramaxInternational Limited were canceled. Concurrent with that cancellation, weissued 500,019.92 shares of common stock to the former Euramax InternationalLimited shareholders.

(3)                                  We adopted SFAS No. 142, “Goodwill and OtherIntangibles,” effective December 29, 2001. Under SFAS No. 142, goodwill andindefinite lived assets are no longer amortized. Accordingly, there is nogoodwill amortization included in the five months ended May 23, 2003, the sevenmonths ended December 26, 2003 and the year ended December 27, 2002.

(4)                                  On June 12, 2003, CVCEP and its affiliatesacquired from our former stockholders and cetain members of our management 54%of our common stock.  As described in “Important Transactions—2003 Stock Transaction”,this resulted in the application of thepurchase method of accounting.  Ourstockholders’ equity increased by $52.4 million and the earnings for the sevenmonths ended December 26, 2003, reflect certain costs and expenses relatedto our accounting for this transaction.

 

20

----

 

**Item 7.  Management’s Discussion and Analysis ofFinancial Condition and Results of Operations**

 

The following discussion shouldbe read in conjunction with “Selected Historical Consolidated Financial Data”and our consolidated financial statements and the accompanying notes theretoincluded elsewhere herein.

 

**Overview**

 

Euramax is an internationalproducer of value-added aluminum, steel, vinyl and fiberglass fabricatedproducts, with facilities strategically located in all major regions of theUnited States, or U.S., as well as the United Kingdom, or U.K., The Netherlandsand France. Our manufacturing and distribution network consists of 43strategically located facilities, of which 37 are located in the U.S. and sixare located in Europe. We sell our products principally to two markets, thebuilding and construction market and the transportation market. Our coreproducts include specialty coated coils, aluminum recreational vehicle, or RV,sidewalls, RV doors, farm and agricultural panels, roofing accessories, metaland vinyl raincarrying systems, soffit and fascia systems, and vinylreplacement windows.  In addition, wesell an extensive line of accessory products, including roofing and sidinghardware, trim parts and roof drainage accessories.  Our customers include original equipment manufacturers, or OEMs,such as RV manufacturers, commercial panel manufacturers and transportationindustry manufacturers; rural contractors; home centers; home improvementcontractors; distributors; industrial and architectural contractors; andmanufactured housing producers.

 

Our results of operations for the year ended December26, 2003 have been separated into the predecessor period and successor periodas a result of the application of purchase accounting in connection with the2003 Stock Transaction described in Note 3 to our consolidated financialstatements.  The discussion of theresults of operations below combines the predecessor five months ended May 23,2003 and the successor seven months ended December 26, 2003 for comparison tothe predecessor year ended December 27, 2002 for purposes of discussing netsales and cost of goods sold.  All otheritems are separated into the predecessor and successor periods for discussionpurposes.

 

In connection with the 2003 Stock Transaction and subsequent issuanceof senior subordinated notes (see Notes 3 and 7 to our consolidated financialstatements), accounting principles generally accepted in the United Statesrequired that the purchase price paid in excess of the book value of our equityacquired be allocated to our assets and liabilities based upon estimates oftheir fair values. This application of purchase accounting resulted inincreasing the value of inventory at the time of the 2003 Stock Transaction by$4.0 million. This inventory was sold in June 2003 and accordingly $4.0 millionwas recorded as cost of goods sold. This amount does not reflect costs incurredor amounts paid by us to prepare inventory for sale and accordingly had noaffect on our cash flows from operations.

 

Financial results for the five months ended May 23, 2003 and the sevenmonths ended December 26, 2003, compared to the same periods in 2002, reflecthigher sales volume in 2003 of raincarrying products to home centers anddistributors, and vinyl window and lattice/awning products to home improvementcontractors. In the U.S., higher material costs, partially offset by higherselling prices, in addition to lower sales to RV manufacturers, resulted inlower operating margins. European results reflect improved demand from newproduct development, strong demand from customers in the U.K. for bathenclosures and shower doors and the start-up of a program in the U.K. to sellresidential doors direct to home centers. Additionally, higher operatingmargins within the European Roll Coating segment resulted from efficiency gainsat the Corby, England paintline, together with a more profitable product mix.The strengthening of the Euro and British Pound against the U.S. Dollar had apositive impact on net sales and earnings from operations in the five monthsended May 23, 2003 and the seven months ended December 26, 2003.

 

**Strategy**

 

A discussion of the Company’s business strategy is located in Item 1“Business – Business Strategy.”

 

While the Company’s strategy includes identifying and acquiringbusinesses and assets that would enable it to offer complementary productsand/or expand geographic coverage, there can be no assurance that additional acquisitionswill be completed or that, if completed, such acquisitions would improve theoverall profitability of the Company (see “Business - Risk Factors -Acquisition Strategy”). Additionally, there can be no assurance that theCompany will experience similar general economic conditions that contributed tooperating results for the five months ended May 23, 2003 and the seven monthsended December 26, 2003.

 

**RiskManagement**

 

We are exposed to market risk from changes ininterest rates, exchange rates (primarily the Euro and British Pound) andcommodity prices. From time to time, we enter into contracts for the purchaseof aluminum and steel at market values in an attempt to assure a margin onspecific customer orders. Historically, we have not engaged in extensivehedging activities intended to manage long-term risks relating to movements inmarket prices of steel and aluminum raw materials. However, from time to time,we may establish a maximum purchase price for varying quantities of futurealuminum purchase

 

21

----

 

requirements through the purchase of call options. Additionally, aspart of a risk-management strategy to reduce the impact of exchange ratefluctuations and/or interest rate fluctuations, we have historically enteredinto currency agreements and interest rate agreements with major bankinginstitutions. See “Quantitative and Qualitative Disclosures About Market Risk”.

 

Approximately 58% and24% of our 2003 net sales were derived from sales of aluminum and steelproducts, respectively. Both of these raw materials are subject to a highdegree of volatility caused by, among other items, the relationship of worldsupply to world demand, the relationship of the U.S. Dollar to other currenciesand the imposition of import and export tariffs. Historically, prices at whichwe sell aluminum and steel products tend to fluctuate with correspondingchanges in the prices paid to suppliers for these raw materials. Supplier priceincreases and decreases are typically, but not always, due to competition andthe market for alternative products, passed on to customers. Accordingly, ournet sales and margins on aluminum and steel products may fluctuate with littleor no change in the volume of shipments.

 

To assure continuity of supply, the Company negotiates contracts forminimum annual purchases of aluminum from several suppliers. Commitments forminimum annual purchases are typically at an agreed upon cost to convertaluminum ingot into coil. At December 26, 2003, the value of such minimumpurchase commitments was approximately $26.0 million. In addition, to ensure amargin on specific sales, the Company may commit to purchase aluminum ingot orcoil at a fixed market price for future delivery. At December 26, 2003,such fixed price purchase commitments were approximately $32.1 million. All ofthe Company's aluminum purchase commitments expire in 2004.

 

**Results of Operations**

 

The following table sets forththe Company’s Statements of Earnings Data expressed as a percentage of netsales:

 
|                             |   | **Five months  ended  May 23,  2003** | ** ** | **Seven months  ended  December 26,  2003 (1)** | ** ** | **Year ended** |   |
|----------------------------------|--------|---------------------------------------|------------|-------------------------------------------------|------------|----------------|--------|
|                             |   |                                  |
|                             |   | **December 27,  2002**                |       | **December 28,  2001**                          |       |
| **Statement  of Earnings Data:** |   | 100.0                                 | %          | 100.0                                           | %          | 100.0          | %      | 100.0 | % |
| Net sales                        |   |                                  |       |                                            |       |           |   |   |   |
| Costs and  expenses:             |   |                                  |       |                                            |       |           |   |   |   |
| Cost of goods  sold              |   | 80.0                                  | %          | 80.4                                            | %          | 79.5           | %      | 80.6 | % |
| Selling and  general             |   | 10.0                                  | %          | 10.3                                            | %          | 9.9            | %      | 10.0 | % |
| Depreciation and  amortization   |   | 2.4                                   | %          | 2.2                                             | %          | 2.2            | %      | 2.9 | % |
| Earnings from  operations        |   | 7.6                                   | %          | 7.1                                             | %          | 8.4            | %      | 6.5 | % |
| Interest  expense, net           |   | 3.5                                   | %          | 2.6                                             | %          | 3.6            | %      | 4.3 | % |
| Other (income)  expense, net     |   | (0.2                                  | )%         | 0.0                                             | %          | (0.1           | )%     | 0.5 | % |
| Earnings before  income taxes    |   | 4.3                                   | %          | 4.5                                             | %          | 4.9            | %      | 1.7 | % |
| Provision for  income taxes      |   | 1.6                                   | %          | 1.5                                             | %          | 1.8            | %      | 0.9 | % |
| Net earnings                     |   | 2.7                                   | %          | 3.0                                             | %          | 3.1            | %      | 0.8 | % |

 

----

(1)   In connection with the 2003 Stock Transaction(see Note 3 to the consolidated financial statements) and subsequent issuanceof senior subordinated notes (see Note 7 to the consolidated financialstatements), accounting principles generally accepted in the U.S. required thatthe purchase price paid in excess of the book value of the equity acquired byallocated to the assets and liabilities of the Company based upon their fairvalues. This application of purchase accounting resulted in increasing thevalue of inventory at the time of the 2003 Stock Transaction by $4.0 million.This inventory was sold in June 2003 and accordingly $4.0 million was recordedas cost of goods sold. This amount does not reflect costs incurred or amountspaid by the Company to prepare inventory for sale and accordingly had no affecton the cash flows from operations of the Company.

 

**Fivemonths ended May 23, 2003 and seven months ended December 26, 2003 compared tothe year ended December 27, 2002.**The following table setsforth the net sales and earnings from operations data by segment for the fivemonths ended May 23, 2003, seven months ended December 26, 2003 and year endedDecember 27, 2002.

 

22

----

 
|                                 |   | **Net Sales**                          |    | **Earnings  from Operations**                |   |
|--------------------------------------|--------|----------------------------------------|---------|----------------------------------------------|--------|
| **In thousands**                     |   | **Five  months  ended  May 23,  2003** |    | **Seven  months  ended  December 26,  2003** |   | **Year  ended  December 27,  2002** |   | **Five  months  ended  May 23,  2003** |   | **Seven  months  ended  December 26,  2003 (1)** |   | **Year  ended  December 27,  2002** |   |
|                                 |   |                                   |    |                                         |   |   |   |   |   |   |   |   |   |
| U.S. Fabrication  Roof Drainage      |   | $                                      | 53,464  |                                         | $      | 125,507 |   | $ | 150,730 |   | $ | 4,669 |   | $ | 15,423 |   | $ | 18,133 |   |
| U.S. Fabrication  Building Materials |   | 107,586                                |    | 200,427                                      |   | 290,171 |   | 3,988 |   | 7,054 |   | 18,565 |   |
| European Roll  Coating               |   | 59,653                                 |    | 96,046                                       |   | 128,543 |   | 7,577 |   | 8,518 |   | 11,229 |   |
| European  Fabrication                |   | 39,912                                 |    | 61,708                                       |   | 69,705 |   | 3,532 |   | 3,576 |   | 5,407 |   |
| Total                                |   | $                                      | 260,615 |                                         | $      | 483,688 |   | $ | 639,149 |   | $ | 19,766 |   | $ | 34,571 |   | $ | 53,334 |   |

 

----

(1)   In connection with the 2003 Stock Transaction(see Note 3 to the consolidated financial statements) and subsequent issuanceof senior subordinated notes (see Note 7 to the consolidated financialstatements), accounting principles generally accepted in the U.S. required thatthe purchase price paid in excess of the book value of the equity acquired byallocated to the assets and liabilities of the Company based upon their fairvalues. This application of purchase accounting resulted in increasing thevalue of inventory at the time of the 2003 Stock Transaction by $4.0 million.This inventory was sold in June 2003 and accordingly $4.0 million was recordedas cost of goods sold. This amount does not reflect costs incurred or amountspaid by the Company to prepare inventory for sale and accordingly had no affecton the cash flows from operations of the Company.

 

*NetSales.*For the year ended December 26, 2003, net sales were$744.3 million compared to $639.1 million for the year ended December 27, 2002,an increase of $105.2 million or 16.5%. Net sales in the U.S. increased 10.5%to $487.0 million for the year ended December 26, 2003, from $440.9 million forthe year ended December 27, 2002. This increase in net sales in the U.S.includes an increase in net sales in the U.S. Fabrication RoofDrainage segment of $28.2 million or 18.7%, and an increase in net salesin the U.S. Fabrication Building Materials segment of $17.8 million or 6.1%.Sales in the U.S. Fabrication Roof Drainage segment increasedprimarily on higher sales of raincarrying products and accessories to homecenters and distributors, together with the acquisition of Berger Holdings onNovember 25, 2003. For the year ended December 26, 2003, compared to the yearended December 27, 2002, sales of raincarrying products to home centers anddistributors increased $28.2 million, of which Berger Holdings accounted for $3.6million of this increase. Sales in the U.S. Fabrication Building Materialssegment increased primarily from higher sales to industrial & architecturalcontractors, home improvement contractors and rural contractors, partiallyoffset by lower sales to RV manufacturers. For the year ended December 26,2003, compared to the year ended December 27, 2002, sales of fabricatedaluminum and steel roofing and siding to industrial & architectural andrural contractors increased $14.6 million; and sales of lattice/awning productsand vinyl windows to home improvement contractors increased $7.7 million.Partially offsetting these increases was a decrease in sales to U.S. RVmanufacturers of $9.2 million resulting from lower selling prices and lowersales volume of aluminum sidewalls. Lower sales volume, despite higher industry production, resulted fromlower industry production of aluminum units in favor of producing units withfiberglass sidewalls.  While we supplysidewalls made from both aluminum and fiberglass, our fiberglass market shareis lower than our aluminum market share.

 

Net sales in Europe increased 29.8% to $257.3 millionfor the year ended December 26, 2003, from $198.2 million for the year endedDecember 27, 2002. This increase in European net sales includes an increase innet sales in the European Roll Coating segment of $27.2 million or 21.1%, andan increase in net sales in the European Fabrication segment of $31.9 millionor 45.8%. Approximately $21.6 million and $12.7 million of the increase in theEuropean Roll Coating segment and the European Fabrication segment,respectively, were a result of the strengthening of the Euro and British Poundagainst the U.S. Dollar. The balance of the increase in the European RollCoating segment primarily resulted from higher sales volumes of paintedaluminum and steel coil to European RV manufacturers and to European OEMs(excluding RV manufacturers). For the year ended December 26, 2003, compared tothe year ended December 27, 2002, excluding currency impact, sales of paintedaluminum coil to European RV manufacturers increased $4.4 million; and sales ofpainted aluminum and steel coil to European OEMs (excluding RV manufacturers)increased $1.4 million. The balance of the increase in the European Fabricationsegment primarily resulted from higher sales volumes to the Europeantransportation industry, European RV manufacturers and U.K. home centers. Forthe year ended December 26, 2003, compared to the year ended December 27, 2002,excluding currency impact, sales from France to the European transportationindustry increased $10.1 million; sales of doors and windows to European RVmanufacturers increased $3.9 million; and sales of residential doors to homecenters in the U.K. increased $5.9 million.

 

23

----

 

*Cost of goods sold.*  Cost of goods sold, as a percentage of netsales, increased to 80.2% for the year ended December 26, 2003, from 79.5% forthe year ended December 27, 2002.  Thisincrease as a percentage of net sales is primarily attributable to the $4.0million increase in inventories resulting from the application of the purchasemethod of accounting associated with the 2003 Stock Transaction (see Note 3 toour consolidated financial statements). The $4.0 million increase was recognized in cost of goods sold in June2003.  The remaining increase is largelyattributable to higher U.S. aluminum costs, partially offset by higher U.S.aluminum selling prices, lower gross margins in the U.S. Fabrication BuildingMaterials segment resulting from lower sales volume to the U.S. RVmanufacturers, in addition to higher labor and utility costs. Higher laborcosts resulted primarily from new product and product expansion initiativesundertaken over the past twelve months. Partially offsetting these items were higher gross margins in theEuropean Roll Coating segment resulting from a higher percentage of net salesto European RV manufacturers, together with efficiency of gains at our Corby,England paintline.

 

*Selling and general.*  Selling and general expenses were $26.2million, $49.6 million and $63.6 million for the five months ended May 23,2003, the seven months ended December 26, 2003 and the year ended December 27,2002, respectively. Selling and general expenses, as a percentage of net sales,were 10.0%, 10.3% and 9.9% for the five months ended May 23, 2003, the sevenmonths ended December 26, 2003 and the year ended December 27, 2002,respectively.  The seven months endedDecember 26, 2003 include $1.4 million in compensation expense resulting frombonus payments associated with the 2003 Stock Transaction, together withadvisory fees of $0.8 million payable to CVC Management LLC and amortization ofrestricted stock awards of $0.4 million. Long-term incentive plan expenses were$0.5 million, $2.6 million and $2.2 million for the five months ended May 23,2003, the seven months ended December 26, 2003 and the year ended December 27,2002. No additional expenses are expected under the long-term incentive plan as2003 was the final year of the plan. Amounts accrued under the plan will bepaid over the next four years in equal payments totaling $1.3 million per year.

* *

*Depreciationand Amortization.*Depreciation and amortization expense was$6.3 million, $10.6 million and $14.0 million for the five months ended May 23,2003, the seven months ended December 26, 2003 and the year ended December 27,2002, respectively. Depreciation and amortization expense in the five monthsended May 23, 2003, reflect additional expense resulting from the strengtheningof the Euro and British Pound against the U.S. Dollar, together with additionalexpense on capital expenditures that occurred in the first five months of 2003.Depreciation and amortization expense in the seven months ended December 26,2003, reflect additional expense resulting from the step-up in basis of ourproperty, plant and equipment and intangible assets associated with the 2003Stock Transaction, together with additional expense resulting from thestrengthening of the Euro and British Pound against the U.S. Dollar. As aresult of the step-up in basis of our property, plant and equipment andintangible assets associated with the 2003 Stock Transaction, an additional$0.8 million of depreciation and amortization expense was recognized in theseven months ended December 26, 2003.

 

*Earnings from operations*.  Earnings from operations were $19.8 million,$34.6 million and $53.3 million for the five months ended May 23, 2003, theseven months ended December 26, 2003 and the year ended December 27, 2002,respectively. In the seven months ended December 26, 2003, earnings fromoperations reflect $4.0 million charged to expense resulting from theapplication of the purchase method of accounting associated with the 2003 StockTransaction.

 

Earnings from operations in the U.S. Fabrication Roof Drainage segmentinclude $1.0 million of the $4.0 million increase in inventories charged toexpense resulting from the application of the purchase method of accountingassociated with the 2003 Stock Transaction. Additionally, the U.S. Fabrication Roof Drainage segment’s resultsinclude higher aluminum costs, partially offset by higher aluminum sellingprices and higher sales volumes.

 

Earnings from operations in the U.S. Fabrication Building Materials segmentinclude $1.7 million of the $4.0 million increase in inventories charged toexpense resulting from the application of the purchase method of accountingassociated with the 2003 Stock Transaction. Additionally, the U.S. Fabrication Building Materials segment operatingmargins were lower than in 2002 as a result of lower sales volumes to RVmanufacturers.

 

Earnings from operations in the European Roll Coating segment include$0.9 million of the $4.0 million increase in inventories charged to expense resultingfrom the application of the purchase method of accounting associated with the2003 Stock Transaction.  Thestrengthening of the British Pound and Euro against the U.S. Dollar increasedthe European Roll Coating segment’s earning from operations by $1.4 million and$1.5 million in the five months ended May 23, 2003 and the seven months endedDecember 26, 2003, respectively, compared to the same periods in 2002.  Additionally, the European Roll Coatingsegment’s 2003 results include a more profitable product mix resulting from ahigher percentage of net sales to European RV manufacturers, together withefficiency of gains at our Corby, England paintline.

 

Earnings from operations in the European Fabrication segment include$0.4 million of the $4.0 million increase in inventories charged to expenseresulting from the application of the purchase method of accounting associatedwith the 2003 Stock Transaction.  Thestrengthening of the British Pound and Euro against the U.S. Dollar increasedthe European Fabrication segment’s earnings from operations by $0.5 million inthe five months ended May 23, 2003 and in the seven months ended December 26,2003, compared to the same periods in 2002. Additionally, the European Fabrication segment’s 2003 results includehigher production costs resulting from new product and product expansioninitiatives undertaken over the past twelve months.

 

*Interestexpense, net.* Net interest expense was $9.1 million, $12.7million and $22.7 million for the five months ended May 23, 2003, the sevenmonths ended December 26, 2003, and the year ended December 27, 2002,respectively. On August 6, 2003, we issued $200.0 million 8.5% seniorsubordinated notes. The proceeds from this issuance were used to purchase ouroutstanding $135.0 million 11.25% senior subordinated notes, of which $112.9million were purchased on August 8, 2003 and $22.1 million were purchased onOctober 1, 2003. The average outstanding balance under our senior securedcredit facility for the five months ended May 23, 2003, the seven months endedDecember 26, 2003 and the year ended December 27, 2002, was $78.2 million,$40.2 million and $76.9 million, respectively. The decrease in the seven monthsended December 26, 2003, compared to the five months ended May 23, 2003 and theyear ended December 27, 2002, primarily resulted from the repayment of debtoutstanding under our revolving credit facility out of proceeds from theissuance of $200.0 million of senior subordinated notes. The average rate ofinterest on our senior secured credit facility for the five months ended May23, 2003, the seven months ended December 26, 2003, and the year ended December27, 2002 was 4.7%, 5.0% and 5.9%, respectively. In the seven months endedDecember 26, 2003, we expensed $0.6 million of deferred finance fees as aresult of the purchase of our outstanding 11.25% senior subordinated notes.

 

*Otherincome (expense), net.* Other income (expense), net was $0.5million, $(0.1) million and $0.7 million for the five months ended May 23,2003, the seven months ended December 26, 2003, and the year ended December 27,2002, respectively.  In the seven monthsended December 26, 2003, we recognized expense of $(1.5) million in accordancewith SFAS No. 145 on the premium paid to purchase $135.0 million in principalamount of the 11.25% senior subordinated notes. The remaining income (expense)in each respective period resulted primarily from foreign exchange gains andlosses on unhedged assets and liabilities remeasured into the local currency.

 

*Provisionfor income taxes.*The effective tax rate for the provisionfor income taxes was 38.2%, 32.5% and 36.5% for the five months ended May 23,2003, the seven months ended December 26, 2003 and the year ended December 27,2002. The decrease in the effective tax rate in the seven months ended December26, 2003, compared to the five months ended May 23, 2003 and the year endedDecember 27, 2002 is primarily the result of a change in state taxconsolidation reporting that enabled us to utilize state net operating losses.

 

**Yearended December 27, 2002 compared to the year ended December 28, 2001.**The following table sets forth the net sales andearnings from operations data by segment for the twelve months ended December27, 2002 and December 28, 2001:

 
|                                 |   | **Net Sales**           |    | **Earnings  from Operations** |   |
|--------------------------------------|--------|-------------------------|---------|-------------------------------|--------|
| **In thousands**                     |   | **December  27,  2002** |    | **December  28,  2001**       |   | **Increase/  (decrease)** |   | **December  27,  2002** |   | **December  28,  2001** |   | **Increase/  (decrease)** |   |
|                                 |   |                    |    |                          |   |   |   |   |   |   |   |   |   |
| U.S. Fabrication  Roof Drainage      |   | $                       | 150,730 |                          | $      | 143,221 |   | 5.2 | % | $ | 18,133 |   | $ | 15,128 |   | 19.9 | % |
| U.S. Fabrication  Building Materials |   | 290,171                 |    | 263,578                       |   | 10.1 | % | 18,565 |   | 7,582 |   | 144.9 | % |
| European Roll  Coating               |   | 128,543                 |    | 127,427                       |   | 0.9 | % | 11,229 |   | 10,207 |   | 10.0 | % |
| European  Fabrication                |   | 69,705                  |    | 58,891                        |   | 18.4 | % | 5,407 |   | 5,545 |   | (2.5 | )% |
| Total                                |   | $                       | 639,149 |                          | $      | 593,117 |   | 7.8 | % | $ | 53,334 |   | $ | 38,462 |   | 38.7 | % |

 

*NetSales.*Net sales increased 7.8% to $639.1 million for theyear ended December 27, 2002, from $593.1 million for the year ended December28, 2001. Net sales in the U.S. increased 8.4% to $440.9 million for the yearended December 27,

 

24

----

 

2002, from $406.8 million for the year ended December 28, 2001. Thisincrease in net sales in the U.S. includes an increase in net sales in the U.S.Fabrication Roof Drainage segment of $7.5 million or 5.2%, and an increase innet sales in the U.S. Fabrication Building Materials segment of $26.6 millionor 10.1%. Sales in the U.S. Fabrication Roof Drainage segment increasedprimarily on higher sales of raincarrying products and accessories todistributors. Sales in the U.S. Fabrication Building Materials segmentincreased primarily from higher sales to RV manufacturers, home improvementcontractors and rural contractors, partially offset by lower sales to manufacturedhousing producers. Additionally, in 2002 we began an initiative to sell paintedaluminum coil externally from our Helena, Arkansas paintline. This initiativeadded $10.5 million in net sales in the U.S. Fabrication Building Materialssegment to the year ended December 27, 2002, compared to the year endedDecember 28, 2001. For the year ended December 27, 2002, compared to the yearended December 28, 2001, sales of raincarrying products and accessories todistributors increased $8.9 million; sales to U.S. RV manufacturers increased$11.4 million; sales of vinyl windows to home improvement contractors increased$4.1 million; and sales to rural contractors increased $3.9 million. Partiallyoffsetting these increases was a decrease in sales to manufactured housingproducers of $4.8 million.

 

Net sales in Europe increased 6.4% to $198.2 million for the year endedDecember 27, 2002, from $186.3 million for the year ended December 28, 2001.This increase in European net sales includes an increase in net sales in theEuropean Fabrication segment of $10.8 million, and an increase in net sales inthe European Roll Coating segment of $1.1 million. Sales in the EuropeanFabrication segment increased primarily from higher sales of fabricated doorsand windows to European RV manufacturers, bath enclosures and shower doors tocustomers in the U.K. and sales from France to the European transportationindustry. Additionally, the strengthening of the Euro and British Pound againstthe U.S. Dollar increased the European Fabrication segment’s sales by $3.3million in the year ended December 27, 2002, compared to the year endedDecember 28, 2001. For the year ended December 27, 2002, compared to the yearended December 28, 2001, excluding currency impact, sales of fabricated doorsand windows to European RV manufacturers increased $2.8 million; sales of bathenclosures and shower doors to customers in the U.K. increased $1.4 million;and sales from France to the European transportation industry increased $3.8million. Sales in the European Roll Coating segment increased primarily fromthe strengthening of the Euro and British Pound against the U.S. Dollar,partially offset by lower sales of painted aluminum and steel coil to OEMs(excluding RV manufacturers). The strengthening of the Euro and British Poundincreased the European Roll Coating segment’s sales by $6.2 million in the yearended December 27, 2002, compared to the year ended December 28, 2001. Sales ofpainted aluminum and steel coil to OEMs (excluding RV manufacturers) decreasedby $4.8 million in the year ended December 27, 2002, compared to the year endedDecember 28, 2001. This decrease primarily resulted from lower aluminum sellingprices resulting from a 6.5% decline in the twelve-month average London MetalsExchange price for aluminum, in addition to lower export volume from the U.K.due to the strength of the British Pound.

 

*Cost ofgoods sold.*Cost of goods sold, as a percentage of net sales,decreased to 79.5% for the year ended December 27, 2002, from 80.6% for theyear ended December 28, 2001. This decrease is primarily attributable to highersales volume and lower material costs, partially offset by lower selling pricesresulting from a decline in world prices for aluminum. The imposition oftariffs on steel products imported by certain foreign producers resulted in anincrease in the cost of steel raw materials we purchased.

 

*Sellingand general.*Selling and general expenses, as a percentage ofnet sales, decreased to 9.9% for the year ended December 27, 2002, from 10.0%for the year ended December 28, 2001. This decrease is primarily attributableto lower bad debt expense and higher net sales, partially offset by an increasein legal and professional expense and an increase in compensation expense. The increasein compensation expense is primarily a result of the increase in profitabilityin 2002, resulting in our recording expenses totaling $2.2 million relating toour long-term incentive plan which rewards participants for an increase in thetheoretical equity value (as defined in the 1999 Phantom Stock Plan) of EuramaxInternational between January 1, 1998 and December 31, 2003. We did notrecognize any expense related to the long-term incentive plan in 2001. See Note13 to the consolidated financial statements for a description of the long-termincentive plan.

 

*Depreciationand amortization.*Depreciation and amortization, as apercentage of net sales, was 2.2% for the year ended December 27, 2002,compared to 2.9% for the year ended December 28, 2001. This decrease isprimarily attributable to

 

25

----

 

the adoption of SFAS No. 142 on December 29, 2001. Under SFAS No. 142goodwill is no longer amortized. See Note 2 to the Consolidated FinancialStatements for further discussion on the adoption of SFAS No. 142.

 

*Earningsfrom operations.*Earnings from operations increased to $53.3million for the year ended December 27, 2002, from $38.5 million for the yearended December 29, 2001. As a result of the adoption of SFAS No. 142 effectiveDecember 29, 2001, goodwill is no longer amortized. Goodwill amortization inthe year ended December 28, 2001 was $4.8 million. The remaining increase inearnings from operations is primarily from improved results from the U.S. FabricationBuilding Materials segment. Partially offsetting these positives were higherincentive compensation expense and legal and professional expense expenses in2002. The increase in incentive compensation expense resulted from the increasein profitability in 2002, resulting in our recording expenses totaling $2.2million relating to our long-term incentive plan which rewards participants foran increase in the theoretical equity value (as defined in the 1999 PhantomStock Plan) of Euramax International between January 1, 1998 and December 31,2003. We did not recognize any expense related to the long-term incentive planin 2001. See Note 13 to the consolidated financial statements for a descriptionof our long-term incentive plan.

 

Earnings from operations in the U.S. Fabrication Roof Drainage segmentincreased to $18.1 million for the year ended December 27, 2002, from $15.1million for the year ended December 28, 2001. This increase primarily resultedfrom lower aluminum costs, partially offset by lower aluminum selling prices,and the adoption of SFAS No. 142. Goodwill amortization in the U.S. FabricationRoof Drainage segment was $2.2 million in the year ended December 28, 2001.

 

Earnings from operations in the U.S. Fabrication Building Materialssegment increased to $18.6 million for the year ended December 27, 2002, from$7.6 million in the year ended December 28, 2001. This increase primarilyresulted from higher sales volumes, lower aluminum and steel costs, partiallyoffset by lower aluminum selling prices, operating improvements at the Helena,Arkansas paintline, and the adoption of SFAS No. 142. Goodwill amortization inthe U.S. Fabrication Building Materials segment was $1.4 million in the yearended December 28, 2001.

 

Earnings from operations in the European Roll Coating segment increasedto $11.2 million for the year ended December 27, 2002, from $10.2 million forthe year ended December 28, 2001. This increase resulted primarily from theadoption of SFAS No. 142, together with the strengthening of the Euro andBritish Pound against the U.S. Dollar. Goodwill amortization in the EuropeanRoll Coating segment was $0.9 million in the year ended December 28, 2001. Thestrengthening of the Euro and British Pound against the U.S. Dollar increasedearnings from operations in the European Roll Coating segment by $0.6 million.

 

Earnings from operations in the European Fabrication segment decreasedto $5.4 million for the year ended December 27, 2002, from $5.5 million for theyear ended December 28, 2001. This decrease resulted primarily from higherincentive compensation expense associated with the 1999 Phantom Stock Plan, asdiscussed above. Partially offsetting these items were higher sales volume andthe strengthening of the Euro and British Pound against the U.S. Dollar. Thestrengthening of the Euro and British Pound against the U.S. Dollar increasedearnings from operations in the European Roll Coating segment by $0.3 million.

 

*Interestexpense, net.* Net interest expense decreased to $22.7 millionfor the year ended December 27, 2002, from $25.3 million for the year endedDecember 28, 2001, primarily due to lower interest rates and lower outstandingindebtedness in the year ended December 27, 2002.

 

*Otherincome (expense), net.*Other income (expense) increased to$0.7 million for the year ended December 27, 2002, from ($3.0) million for theyear ended December 28, 2001. In the year ended December 28, 2001, werecognized expense of $2.5 million as a result of the change in fair value ofour derivative instruments that were not designated as hedges under SFAS No.133. We did not recognize any expense for this reason in the year endedDecember 27, 2002. The remaining difference is primarily due to foreignexchange gains on unhedged liabilities remeasured into the local currencyrecognized in the year ended December 27, 2002, whereas foreign exchange losseswere recognized in the year ended December 28, 2001.

 

26

----

 

*Provisionfor income taxes.*The effective rate for the provision forincome taxes was 36.5% for the year ended December 27, 2002 and 53.9% for theyear ended December 28, 2001. The decrease in the effective rate is primarilydue to the adoption of SFAS No. 142 on December 29, 2001. Under SFAS No. 142 goodwillis not longer amortized, eliminating the permanent difference fornon-deductible goodwill.

 

**Liquidity and Capital Resources**

 

*Liquidity.*Our primary liquidity needs arise from debt service onindebtedness incurred in connection with acquisitions and the funding ofcapital expenditures. Our liquidity sources at December 26, 2003 include $48.2million in cash and cash equivalents and our revolving credit facility of up to$110.0 million, subject to borrowing base limitations. At December 26, 2003, theentire $110.0 million was undrawn, of which $100.8 million was available due toborrowing base limitations.

 

As discussed in Note 7 to our consolidated financial statements, onAugust 8, 2003, we purchased approximately $112.9 million of the $135.0 millionaggregate principal amount of 11.25% senior subordinated notes due 2006 (the“11.25% Notes”) issued by certain of our subsidiaries, for approximately $120.4million, including premium and accrued interest. On October 1, 2003, theremaining $22.1 million in aggregate principal amount of the 11.25% Notes wasredeemed for approximately $23.8 million, including premium and accruedinterest. We financed the purchase of the 11.25% Notes through the issuance onAugust 6, 2003 of $200.0 million 8.50% senior subordinated notes due 2011 (the“8.50% Notes”). The remaining proceeds from the issuance of the 8.50% Noteswere used to cover fees and expenses from the issuance of the 8.50% Notes andto repay a portion of the existing indebtedness under our revolving creditfacility.

 

On October 10, 2003, we entered into a definitive agreement with BergerHoldings, Ltd. for the acquisition of all of the outstanding shares of BergerHoldings for $3.90 per share. Berger Holdings and its subsidiaries manufactureroof drainage products as well as residential and commercial snow guards and isincluded in our U.S. Fabrication Roof Drainage segment. Pursuant to a tenderoffer that expired on November 17, 2003, Amerimax Pennsylvania, Inc., awholly-owned subsidiary of Euramax, accepted and purchased approximately 93% ofBerger Holding’s outstanding common shares. The acquisition of Berger Holdingswas completed on November 25, 2003 by the merger of Amerimax Pennsylvania intoBerger Holdings, with Berger Holdings as the survivor corporation. As a resultof the merger, each common share of Berger Holdings not owned by the Companywas converted into the right to receive $3.90 per share in cash, subject todissenters' rights.  The total purchaseprice of the acquisition was approximately $36.8 million, including associatedfees and expenses, $9.3 million of debt that was paid using cash on hand, thesettlement of employee stock options, and the cost to acquire the remaining 7%of the outstanding stock of Berger Holdings that was not tendered and acceptedin the tender offer. 

 

On October 9, 2003, we amended and restated our senior secured creditfacility with our lenders. As amended and restated, our senior secured creditfacility includes a $110.0 million revolving credit facility and a $35.0million term loan. We borrowed $35.0 million under the term loan on October 31,2003. The interest rates applicable to the loans under our amended and restatedsenior secured credit facility are based upon a Base Rate or Eurocurrency Rate(both as defined in our amended and restated senior secured credit facility),plus their respective margins. Our amended and restated senior secured creditfacility provides for variable rate margins, determined quarterly, based uponour ratio of EBITDA (as defined in our amended and restated senior securedcredit facility) to total debt. The maximum and minimum Base Rate margins are2.00% and 1.00%, respectively, on the revolving credit facility. The maximumand minimum Eurocurrency Rate margins are 3.00% and 2.25%, respectively, on therevolving credit facility, and 3.25% and 2.50%, respectively, on the term loan.We are subject to a commitment fee on a quarterly basis equal to 0.375% of theunused portion of the revolving credit facility. Our amended and restated seniorsecured credit facility contains certain covenants and restrictions on ouractions, including certain restrictions on the payment of cash dividends. Inaddition, our amended and restated senior secured credit facility requires usto meet certain financial tests, including a fixed charge coverage ratio,minimum interest coverage ratio, maximum leverage ratio and maximum amounts ofcapital expenditures.

 

We expect on or before April 30, 2004 to repurchase all of ouroutstanding common stock held by Court Square, or 169,680.62 shares, for anaggregate repurchase price of approximately $67.9 million. Such transaction issubject to restrictions contained in

 

27

----

 

agreements governing our existing or future indebtedness and will befunded principally with borrowings under our revolving credit facility.

 

Our leveraged financial position requires that a substantial portion ofour cash flow from operations be used to pay interest on the seniorsubordinated notes, principal and interest under our senior secured creditfacility and other indebtedness. Significant increases in the floating interestrates on borrowings under our senior secured credit facility would result inincreased debt service requirements, which may reduce the funds available forcapital expenditures and other operational needs. In addition, our leveragedposition may impede our ability to obtain financing in the future for workingcapital, capital expenditures and general corporate purposes. Further, ourleveraged position may make us more vulnerable to economic downturns, may limitour ability to withstand competitive pressures, and may limit our ability tocomply with restrictive financial covenants required under our senior securedcredit facility.

 

Our primary source of liquidity is funds generated from operations,which are supplemented by borrowings under our senior secured credit facility.Net cash (used in) provided by operating activities for the five months endedMay 23, 2003 and the seven months ended December 26, 2003 were $(12.0) millionand $77.0 million, respectively, compared to $25.4 million in the year endedDecember 27, 2002 and $35.5 million in the year ended December 28, 2001. Inaddition to cash generated from earnings, a key component of our cash flow fromoperations is changes in our working capital accounts. The five months endedMay 23, 2003, include a use of cash resulting from an increase in accountsreceivable and inventories of $22.8 million and $13.0 million, respectively. Partiallyoffsetting this use of cash was cash provided by an increase in accountspayable and other current liabilities of $9.2 million. The seven months endedDecember 26, 2003, include cash provided from an increase in accounts payableand other current liabilities of $23.1 million and a decrease in inventories of$16.8 million. The year ended December 27, 2002, includes a use of cashresulting from an increase in accounts receivable and inventories of $5.2million and $11.2 million, respectively. Partially offsetting this use of cashwas cash provided by an increase in accounts payable and other currentliabilities of $6.9 million. The year ended December 28, 2001, includes cashprovided from a decrease in inventories of $16.0 million, partially offset by cashused by an increase in accounts receivable of $7.2 million and a decrease inaccounts payable and other current liabilities of $2.8 million. The seasonalityof our business results in significant changes in accounts receivable,inventories, accounts payable and accrued expense balances throughout the year,with balances typically higher at the end of our second and third quarters andlower at the end of our fourth quarter.

 

Net cash used in investingactivities for the five months ended May 23, 2003, the seven months endedDecember 26, 2003, and the years ended December 27, 2002 and December 28, 2001were $4.9 million, $40.1 million, $7.8 million and $7.2 million, respectively.The seven months ended December 26, 2003 include the purchase of Berger HoldingsLimited which used $35.3 million of cash. The five months ended May 23, 2003,the seven months ended December 26, 2003, and the years ended December 27, 2002and December 28, 2001, include capital expenditures of $4.9 million, $5.1million, $8.3 million and $8.3 million, respectively.

 

Net cash provided by (used in)financing activities for the five months ended May 23, 2003, the seven monthsended December 26, 2003, and the years ended December 27, 2002 and December 28,2001, were $18.2 million, $(4.7) million, $(13.9) million and $(29.6) million,respectively. The five months ended May 23, 2003 include borrowing under ourrevolving credit facility of $18.3 million to fund our increase in workingcapital, together with the purchase of treasury stock for $2.6 million. Theseven months ended December 26, 2003 include the receipt of approximately$191.6 million of proceeds, net of issuance costs, from the issuance of $200.0million of senior subordinated notes. These proceeds, in addition to cashprovided by operating activities, were used to purchase $135.0 million of our11.25% Notes for $138.5 million, including premium, and repay $81.7 million onour revolving credit facility. On October 31, 2003 we borrowed approximately$35.0 million under the term loan portion of our amended and restated seniorsecured credit facility. The year ended December 27, 2002 includes a repaymentof term loans under our senior secured credit facility in March 2002 of $39.0million, borrowings under our revolving credit facility of $23.8 million andproceeds of $2.8 million from the termination of our British Pound swap. Theyear ended December 28, 2001 includes a repayment of term loans under oursenior secured credit facility of $23.0 million, a repayment on our revolving creditfacility of $2.8 million and a payment of $3.2 million to terminate an interestrate swap.

 

28

----

 

Future payments due under debtand lease obligations at December 26, 2003 are as follows:

 
|       |   | **Long-Term  Obligations** |    | **Non-Cancelable  Operating Leases** |   | **Total** |   |
|------------|--------|----------------------------|---------|--------------------------------------|--------|-----------|--------|
|       |   |                       |    |                                 |   |      |   |
| 2004       |   | $                          | 7,487   |                                 | $      | 7,713     |   | $ | 15,200 |   |
| 2005       |   | 7,673                      |    | 6,660                                |   | 14,333    |   |
| 2006       |   | 7,539                      |    | 4,338                                |   | 11,877    |   |
| 2007       |   | 5,708                      |    | 3,248                                |   | 8,956     |   |
| 2008       |   | 10,887                     |    | 2,013                                |   | 12,900    |   |
| Thereafter |   | 200,000                    |    | 3,010                                |   | 203,010   |   |
|       |   | $                          | 239,294 |                                 | $      | 26,982    |   | $ | 266,276 |   |

 

*CapitalExpenditures.* In addition to meeting debt servicerequirements, operating cash flows have enabled us to invest in capitalprojects, which maintain manufacturing capabilities, enable compliance withlaws and regulations and prepare us for future growth. Capital expenditureswere $4.9 million, $5.1 million, $8.3 million and $8.3 million in the fivemonths ended May 23, 2003, the seven months ended December 26, 2003, and theyears ended December 27, 2002 and December 28, 2001, respectively. Capitalexpenditures in 2003, 2002 and 2001 include approximately $1.6 million in eachrespective year for improvements to the paintlines in Helena, Arkansas; Corby,England; and Roermond, The Netherlands. The paint lines are capital-intensiveoperations, and will continue to require improvements and upgrades in 2004 andbeyond to enhance their capabilities and efficiencies. Capital expenditures in2003, 2002 and 2001 include approximately $4.1 million, $2.9 million and $3.8million, respectively, for projects related to business expansion. The balanceof capital expenditures in all periods primarily relates to purchases andupgrades of fabricating equipment, transportation and material movingequipment, and information systems. We expect that approximately $3.0 millionto $4.0 million in capital expenditures are required annually to maintainexisting equipment and facilities. We expect that capital spending in 2004 willalso be devoted to projects that offer potential for internal growth throughnew products and expanding existing products to new markets, although theseplans may change.

 

*Workingcapital management.*Working capital was $116.8 million as ofDecember 26, 2003, compared to $90.5 million as of December 27, 2002. Thisincrease in working capital is largely attributable to higher cash and cashequivalents as of December 26, 2003, together with the acquisition of BergerHoldings, Ltd. on November 25, 2003. Higher cash and cash equivalents primarilyresulted from the issuance of $200.0 million senior subordinated notes onAugust 6, 2003, from which a portion of the proceeds were used to repayborrowings under the revolving credit facility and purchase the outstanding11.25% Notes.

 

Accounts receivable of $121.7 millionas of December 26, 2003, increased $33.2 million, from $88.5 million as ofDecember 27, 2002. The primary reason for this increase was a 33.4% increase innet sales in the two months ended December 26, 2003, compared to the two monthsended December 27, 2002. The majority of outstanding accounts receivable at theend of each period are generated from net sales in the preceding two months. Astronger British Pound and Euro compared to the U.S. Dollar used in convertingthe local currency balance sheet into U.S. Dollars resulted in an $8.4 millionincrease in accounts receivables.  As ofDecember 26, 2003, days sales outstanding in accounts receivable was 53.9 days,compared to 50.5 days as of December 27, 2002. The primary reason for thisincrease was the acquisition of Berger Holdings, Ltd. on November 25, 2003.

 

Inventories of $89.5 million asof December 26, 2003, increased $11.1 million, from $78.5 million as ofDecember 27, 2002. A stronger British Pound and Euro compared to the U.S.Dollar used in converting the local currency balance sheet into U.S. Dollarsresulted in a $4.2 million increase in inventories. Additionally, theacquisition of Berger Holdings, Ltd. resulted in a $6.8 million increase ininventories. As of December 26, 2003, days sales in inventories was 54.9 days,compared to 56.2 days as of December 27, 2002.

 

29

----

 

**Off-BalanceSheet Arrangements**

 

At December 26, 2003 and December 27, 2002, we did not have anyrelationships with unconsolidated entities or financial partnerships, such asentities often referred to as structured finance or special purpose entities,which would have been established for the purpose of facilitating off-balancesheet arrangements or other contractually narrow or limited purposes.  We are, therefore, not materially exposed toany financing, liquidity, market or credit risk that could arise if we hadengaged in such relationships.

 

**Inflation and Foreign Currency Translation**

 

In recent years, inflation hasnot had a significant effect on our results of operations or financialcondition. The assets and liabilities of our non-U.S. subsidiaries aretranslated into U.S. Dollars at current exchange rates and revenues andexpenses are translated at average exchange rates.

 

**Critical Accounting Policies**

 

*Allowance for doubtful accounts, inventoryobsolescence and warranty reserves.*Our significant accounting policies are described in Note 2 to theconsolidated financial statements. As indicated there, we make estimates and assumptionsthat affect certain amounts reported in the consolidated financial statements.The use of estimates is significant as it relates to establishing reserves andallowances for doubtful accounts, inventory obsolescence and warranty costs.Ranges of estimates are developed based upon historical experience,specifically identified conditions and management expectations for the futureoccurrence of certain events. In the event that actual results differ fromthese estimates or we adjust these estimates in future periods, adjustments tothe amounts recorded could materially impact our financial position and resultsof operations. There have been no significant changes in the assumptions usedto develop our estimates in establishing reserves and allowances for doubtfulaccounts, inventory obsolescence and warranty costs from fiscal year 2002 tofiscal year 2003 and no significant changes are anticipated for fiscal 2004.

 

*Income taxes.*Our income tax accounting policy is significant indetermining financial position and results of operations. Such policy requiresus to estimate income taxes in each jurisdiction in which we operate. Thisinvolves estimating actual current tax expense, assessing tax exposure mattersand assessing temporary differences resulting from the different treatment ofitems under accounting principles generally accepted in the United States andtax law. These differences result in deferred tax assets and liabilities, whichare included in our consolidated balance sheet. We must then assess thelikelihood that deferred tax assets will be recovered from future taxableincome. To the extent that recovery is less likely than not, a valuationallowance is established. Significant management judgment is required toestablish such allowances as well as to determine the provision for incometaxes and deferred tax assets and liabilities. In the event that actual resultsdiffer from estimates, or do not reflect management judgments, it may benecessary to adjust amounts recorded in income tax accounts, which couldmaterially impact our financial position and results of operations. There havebeen no significant changes in the assumptions used to develop our estimates inestablishing our income tax expense, tax exposure matters or deferred taxes andno significant changes are anticipated for fiscal 2004.

 

*Impairment of goodwill.* We usejudgment in assessing goodwill for impairment. Upon adoption of SFAS No. 142 onDecember 29, 2001, we assessed the recoverability of our goodwill. Subsequentto the adoption of SFAS No. 142, we review the carrying value of our goodwillat least annually on the first day of the fiscal fourth quarter, or sooner ifevents or changes in circumstances indicate the carrying value may exceed fairvalue. Recoverability is determined by comparing management’s estimate of thefair value of the reporting unit to which the goodwill applies to the carryingvalue, including goodwill, of that reporting unit. If the fair value of thereporting unit exceeds its carrying value, goodwill of the reporting unit isnot impaired. If the carrying value of the reporting unit exceeds its fairvalue, the implied fair value of the reporting unit goodwill is compared to thecarrying value of that goodwill. If the carrying value of the reporting unit goodwillexceeds the implied fair value of that goodwill, an impairment loss isrecognized in an amount equal to that excess. At December 26, 2003, we had$176.4 million of goodwill, net of amortization, included in our statement offinancial position.

 

**Accounting Pronouncements**

 

In April 2002, the Financial Accounting Standards Board, or FASB,issued Statement of Financial Accounting Standards No. 145, “Rescission of FASBStatements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and TechnicalCorrections”, or SFAS No. 145. Among other items, SFAS No. 145 updates andclarifies existing accounting pronouncements related to reporting gains andlosses from the extinguishment of debt and certain lease modifications thathave economic effects similar to sale-leaseback transactions. SFAS No. 145became effective for us on the first day of fiscal year 2003. We recordedinterest expense and other expense, net of tax, of approximately $0.4 millionand $1.0 million, respectively, during the seven months ended December 26,2003.  These items represent unamortizeddeferred finance fees and the amounts paid in excess of the carrying value ofthe retired debt related to the senior subordinated notes purchased or redeemedas described in Note 7 to our consolidated financial statements. Prior to theadoption of SFAS No. 145, we would have recognized this amount as

 

30

----

 

an extraordinary loss, net of tax.

 

In December 2002, the FASB issued Statement No. 148, “Accounting forStock-Based Compensation, Transition and Disclosure”, or SFAS No. 148. SFAS No.148 provides alternative methods of transition for a voluntary change to thefair value based method of accounting for stock-based employee compensation.SFAS No. 148 also amends the disclosure requirements of SFAS No. 123 to requireprominent disclosure in both annual and interim financial statements about themethod of accounting for stock-based compensation and the pro forma effect onnet income had the fair value of the options been expensed. The disclosurerequirements of SFAS No. 148 became effective at its issuance. The adoption ofSFAS No. 148 did not have a material impact on our financial position orresults of operations.

 

In January 2003, the FASB issued Interpretation No. 46, “Consolidationof Variable Interest Entities”, or FIN 46, which addresses consolidation ofvariable interest entities. FIN 46 requires a variable interest entity to beconsolidated by a parent company if that company is subject to a majority of therisk of loss from the variable interest entity’s activities or entitled toreceive a majority of the entity’s residual returns or both. A variableinterest entity is a corporation, partnership, trust or any other legalstructure used for business purposes that either does not have equity investorswith voting rights or has equity investors that do not provide sufficientfinancial resources for the entity to support its activities. The consolidation requirements of FIN 46apply immediately to variable interest entities created after January 31,2003.  For older entities, theserequirements will begin to apply in the first fiscal year or interim periodbeginning after December 15, 2003.  Theadoption of FIN 46 is not expected to have a material impact on the Company’sfinancial position or results of operations.

 

In April 2003, the FASB issued Statement No.149, “Amendment of Statement 133 on Derivative Instruments and HedgingActivities”, or SFAS No. 149. SFAS No. 149 clarifies under what circumstances acontract with an initial net investment meets the characteristics of aderivative, amends the definition of an underlying contract and clarifies whena derivative contains a financing component in order to increase thecomparability of accounting practices under SFAS No. 133, “Accounting forDerivative Instruments and Hedging Activities”. SFAS No. 149 is effective forcontracts entered into or modified after June 30, 2003, and for hedgingrelationships designated after June 30, 2003. The adoption of SFAS No. 149 didnot have a material impact on the Company’s financial position or results ofoperations.

 

In December 2003, the FASB issued Statement No. 132 (revised 2003),“Employers’ Disclosures about Pensions and Other Post Retirement Benefits”, orSFAS No. 132 (revised 2003).  SFAS No.132 (revised 2003) requires additional disclosures to those in the originalStatement No. 132 about the assets, obligations, cash flows and net periodiccost of defined benefit plans and other defined benefit postretirement plans.  The Company’s disclosures in Note 12incorporate the additional disclosures required by SFAS No. 132 (revised 2003).

 

**Environmental Matters**

 

Our manufacturing facilities are subject to a range of federal, state,local and European environmental and occupational health and safety laws,including those which relate to air emissions, wastewater discharges, thehandling and disposal of solid and hazardous waste, and the remediation ofcontamination associated with the current and past use of hazardous substancesor materials. If a release of hazardous substances or materials occurs on orfrom our properties or any offsite disposal location used by us, or ifcontamination from prior activities is discovered at any of our properties, wemay be held liable for the costs of remediation (including any response costs),natural resource damages and associated transaction costs. While the amount ofsuch liability could be material, we devote resources to ensure that ourcurrent operations are conducted in a manner intended to reduce such risks.

 

Based upon environmental reviews conducted internally on a quarterlybasis, by outside consultants on a periodic basis, and by outside consultantsin connection with the acquisition of Alumax’s fabricated products business, andassuming compliance by Alumax with its indemnification obligations under therelated acquisition agreement, we believe that we are currently in compliancewith, and not subject to liability under, environmental laws except where suchnoncompliance or liability would not reasonably be expected to have a materialadverse effect on our consolidated financial position, results of operations orcash flows. Pursuant to the terms of the Alumax acquisition agreement, Alumaxagreed to correct and to bear substantially all costs with respect to certainidentified conditions of potential noncompliance and liability underenvironmental laws, none of which costs are currently believed to be material.Alumax’s indemnification obligations under the acquisition agreement are notsubject to an aggregate dollar limitation and survive indefinitely with respectto specifically identified environmental matters.

 

Liability with respect tohazardous substance or material releases in the U.S. arises principally underthe federal

 

31

----

 

Comprehensive EnvironmentalResponse, Compensation, and Liability Act of 1980, as amended, or CERCLA, andsimilar state laws, which impose strict, and under certain circumstances,retroactive, joint and several liability upon statutorily defined classes ofpotentially responsible parties, or PRPs. We have been identified as a PRP ateleven National Priorities List, or NPL, sites under CERCLA, although two ofthese eleven sites may relate to disposal by divisions of Alumax that havenever been and are not now part of Euramax. Pursuant to the terms of the Alumaxacquisition agreement, Alumax has agreed to indemnify us for all of the costsassociated with each of these eleven NPL sites. In addition, Alumax has agreedto indemnify us for all of the costs associated with nine additional siteslisted on state hazardous site cleanup lists, with respect to which we have notreceived any notice of potential responsibility.

 

At our Corby, England facility, Legionellawas found to be present on site in a cooling tower. An independent testinglaboratory is testing water samples for the presence of Legionella on a weeklybasis, and no further evidence of Legionella has been detected to date. Basedupon the investigation, we believe that the reasonable likely outcome of thismatter will not materially impact our future consolidated financial position,results of operations, or cash flows.

 

The facility that Berger leases inIvyland, Pennsylvania has contaminated groundwater as a result of the migrationfrom an adjacent property which was formerly the Naval Air Warfare Center,currently an NPL site under CERCLA. The United States Navy is conducting aclean-up of the Naval Air Warfare Center NPL site under the Environmental ProtectionAgency’s supervision. The owner/landlord of the Berger property obtainedliability protection under Pennsylvania’s Brownfield Law by demonstrating tothe Commonwealth of Pennsylvania that the contamination is from an off-sitesource, and under Pennsylvania law that protection benefits tenants as well.Moreover, under Berger’s lease, the landlord retained any liability for thiscontamination. Accordingly, although the facility leased by Berger is on an NPLsite, the effects of this contamination would not reasonably be expected tohave a material adverse effect on our consolidated financial position, resultsof operations or cash flows.

 

We have made and will continue to make capital expenditures to complywith environmental laws. Environmental capital expenditures for the years endedDecember 26, 2003, December 27, 2002 and December 28, 2001 were approximately$143.1 thousand, $212.1 thousand and $581.8 thousand, respectively. We estimatethat our environmental capital expenditures will be approximately $500.0thousand in 2004.

 

**Item 7A.  Quantitativeand Qualitative Disclosures about Market Risk**

 

The following discussion aboutthe Company’s risk-management activities includes forward-looking statementsthat involve risk and uncertainties. Actual results could differ materiallyfrom those projected in the forward-looking statement. See the note precedingPart I of Item 1 “Business” for additional information regarding the PrivateSecurities Litigation Reform Act.

 

Weare exposed to market risk from changes in interest rates (primarily U.SDollar, Euro and British Pound one month LIBOR), exchange rates (primarily theEuro and British Pound) and commodity prices (primarily aluminum and steel). Atcertain times, we enter into contracts for the purchase of aluminum and steelat market values in an attempt to assure a margin on specific customer orders.Additionally, we have the option to commit to purchase a specific quantity ofaluminum over a specified time period at a fixed price. We would then be exposedfor the difference between the fixed price and the market price of aluminum.Historically, we have not engaged in extensive hedging activities intended tomanage long-term risks relating to movements in market prices of steel andaluminum raw materials as changes in the market price can generally be passedon to customers. However, we have at times purchased, and expect from time totime to continue to purchase, options to buy aluminum at a fixed price for aportion of our anticipated requirements. In addition, although approximately35% of the our sales for the year ended December 26, 2003, originated in Europeand were impacted by exchange rate fluctuations, we have not historicallyutilized derivatives to manage foreign currency exchange risks related to ourEuropean operations. However, in connection with our risk-management strategy,we have historically entered into currency agreements and interest rateagreements with major banking institutions to manage the impact of foreigncurrency exchange rate fluctuations and/or interest rate fluctuations withrespect to debt payments. The agreements are utilized as risk-management toolsand not for trading purposes. Currency agreements involve exchanges of interestpayments in differing currencies and provide for the exchange of principalamounts at maturity. Interest rate agreements involve exchanges of interestpayments at differing interest rates and cap the highest rate of interest to bepaid on specified notional amounts of

 

32

----

debt.  The amounts of interest paid or receivedeffectively limit the interest payment exposure of our hedged debt commitments.The fair value of the currency agreements and interest rate agreements arederived from valuation models based upon recognized financial principals andestimates about relevant future market conditions. The amounts exchanged arebased upon the notional amounts of the currency agreements and interest rateagreements, as well as on the other terms of the agreements, which relate to interestpayments and exchange rates. For detailed information on the terms and fairvalues of our financial instruments and derivative instruments, see Note 2 toour consolidated financial statements.

 

**InterestRate Risk**

 

This analysis presents the hypothetical increase in interest expenseand increase in other expense related to those financial instruments andderivative instruments held by us at December 26, 2003, that are sensitive tochanges in interest rates. A hypothetical 10 percent increase in interest ratesfor one year on our variable rate financial instruments would increase interestexpense by approximately $0.2 million as calculated at December 26, 2003, ascompared to a hypothetical increase in interest expense of approximately $0.3million as calculated at December 27, 2002.

 

A hypothetical 10% decrease in interest rates for one year on ourderivative instruments would increase other expense by approximately $0.1million as calculated at December 26, 2003, compared to no impact on otherexpense as calculated at December 27, 2002.

 

**ForeignCurrency Exchange Risk**

 

This analysis presents the hypothetical increase in foreign exchangeloss and increase in interest expense related to those financial instrumentsand derivative instruments held by us at December 26, 2003, that are sensitiveto changes in foreign currency exchange risks. A hypothetical 10 percentincrease in foreign currency exchange rates would increase our foreign exchangeloss by approximately $0.9 million as calculated at December 26, 2003, ascompared to a hypothetical increase in our foreign exchange loss ofapproximately $0.2 million as calculated at December 27, 2002.

 

All other factors remaining unchanged, a hypothetical 10 percentincrease in foreign currency exchange rates for one year would increaseinterest expense by approximately $0.2 million as calculated at December 26,2003, for those financial instruments and derivative instruments affected byforeign currency exchange fluctuations, as compared to a hypothetical increase ininterest expense of approximately $0.8 million as calculated at December 27,2002.

 

33

----

 

**Item8.  Financial Statements andSupplementary Data**

 

**Reportof Independent Auditors**

 

 

The Board of Directors

Euramax International, Inc. and Subsidiaries

 

We have audited the accompanying consolidated balancesheets of Euramax International, Inc. and Subsidiaries as of December 26, 2003and December 27, 2002, and the related consolidated statements of earnings, changesin equity, and cash flows for the seven months ended December 26, 2003, thefive months ended May 23, 2003 and the years ended December 27, 2002 andDecember 28, 2001. Our audits also included the related financial statementschedule listed in the index at Item 15(a)(2). These financial statements andschedule are the responsibility of the Company’s management. Our responsibilityis to express an opinion on these financial statements and schedule based onour audits.

 

We conducted our audits in accordance with auditingstandards generally accepted in the United States. Those standards require thatwe plan and perform the audit to obtain reasonable assurance about whether thefinancial statements are free of material misstatement. An audit includes examining,on a test basis, evidence supporting the amounts and disclosures in thefinancial statements. An audit also includes assessing the accountingprinciples used and significant estimates made by management, as well asevaluating the overall financial statement presentation. We believe that ouraudits provide a reasonable basis for our opinion.

 

In our opinion, the financial statements referred toabove present fairly, in all material respects, the consolidated financialposition of Euramax International, Inc. and Subsidiaries at December 26, 2003and December 27, 2002, and the consolidated results of their operations andtheir cash flows for the seven months ended December 26, 2003, the five monthsended May 23, 2003 and the years ended December 27, 2002 and December 28, 2001,in conformity with accounting principles generally accepted in the UnitedStates. Also, in our opinion, the related financial statement schedule, whenconsidered in relation to the basic financial statements taken as a whole,presents fairly in all material respects the information set forth therein.

 

 
|             | /s/  Ernst  & Young LLP |   |
|------------------|----------------------------------|--------|
|             |
|             |
| Atlanta, Georgia |
| March 10, 2004   |

 

34

----

 

**EuramaxInternational, Inc. and Subsidiaries**

**ConsolidatedStatements of Earnings**

 
|                           |   | **Predecessor**                        |    | **Successor**                                |       | **Predecessor**                     |       |
|--------------------------------|--------|----------------------------------------|---------|----------------------------------------------|------------|-------------------------------------|------------|
| **Thousands of U.S. Dollars**  |   | **Five  months  ended  May 23,  2003** |    | **Seven  months  ended  December 26,  2003** | ** ** | **Year  ended  December 27,  2002** | ** ** | **Year  ended  December 28,  2001** | ** ** |
|                           |   |                                   |    |                                         |       |                                |       |   |   |
| Net sales                      |   | $                                      | 260,615 |                                         | $          | 483,688                             |       | $ | 639,149 |   | $ | 593,117 |   |
|                           |   |                                   |    |                                         |       |                                |       |   |   |
| Costs and  expenses:           |   |                                   |    |                                         |       |                                |       |   |   |
| Cost of goods  sold            |   | 208,420                                |    | 388,829                                      |       | 508,254                             |       | 477,870 |   |
| Selling and  general           |   | 26,153                                 |    | 49,649                                       |       | 63,593                              |       | 59,230 |   |
| Depreciation and  amortization |   | 6,276                                  |    | 10,639                                       |       | 13,968                              |       | 17,555 |   |
| Earnings from  operations      |   | 19,766                                 |    | 34,571                                       |       | 53,334                              |       | 38,462 |   |
|                           |   |                                   |    |                                         |       |                                |       |   |   |
| Interest  expense, net         |   | (9,126                                 | )       | (12,659                                      | )          | (22,748                             | )          | (25,258 | ) |
| Other income  (expense), net   |   | 506                                    |    | (48                                          | )          | 703                                 |       | (2,953 | ) |
| Earnings before  income taxes  |   | 11,146                                 |    | 21,864                                       |       | 31,289                              |       | 10,251 |   |
| Provision for  income taxes    |   | 4,254                                  |    | 7,108                                        |       | 11,432                              |       | 5,521 |   |
| Net earnings                   |   | $                                      | 6,892   |                                         | $          | 14,756                              |       | $ | 19,857 |   | $ | 4,730 |   |

 

The accompanyingnotes are an integral part of these consolidated financial statements.

 

35

----

 

**EuramaxInternational, Inc. and Subsidiaries**

**ConsolidatedBalance Sheets**

 
| **Thousands of U.S. Dollars (except share data)**                                                                                                                               |   | **Successor  December 26,  2003** |    | **Predecessor  December 27,  2002** |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------|---------|-------------------------------------|--------|
| **ASSETS**                                                                                                                                                                      |   |                              |    |                                |   |
| Current assets:                                                                                                                                                                 |   |                              |    |                                |   |
| Cash and cash  equivalents                                                                                                                                                      |   | $                                 | 48,227  |                                | $      | 11,646 |   |
| Accounts  receivable, less allowance for doubtful accounts (2003 - $2,956; 2002 -  $3,513)                                                                                      |   | 121,689                           |    | 88,508                              |   |
| Inventories                                                                                                                                                                     |   | 89,543                            |    | 78,480                              |   |
| Deferred income  taxes                                                                                                                                                          |   | 6,318                             |    | 3,904                               |   |
| Other current  assets                                                                                                                                                           |   | 1,870                             |    | 1,177                               |   |
| Total current  assets                                                                                                                                                           |   | 267,647                           |    | 183,715                             |   |
| Property, plant  and equipment, net                                                                                                                                             |   | 141,437                           |    | 112,037                             |   |
| Goodwill, net of  accumulated amortization                                                                                                                                      |   | 176,394                           |    | 110,799                             |   |
| Deferred income  taxes                                                                                                                                                          |   | 3,595                             |    | 4,975                               |   |
| Other assets                                                                                                                                                                    |   | 19,756                            |    | 4,914                               |   |
|                                                                                                                                                                            |   | $                                 | 608,829 |                                | $      | 416,440 |   |
|                                                                                                                                                                            |   |                              |    |                                |   |
| **LIABILITIES AND SHAREHOLDERS’  EQUITY**                                                                                                                                  |   |                              |    |                                |   |
| Current  liabilities:                                                                                                                                                           |   |                              |    |                                |   |
| Cash overdrafts                                                                                                                                                                 |   | $                                 | 436     |                                | $      | 1,880 |   |
| Accounts payable                                                                                                                                                                |   | 91,689                            |    | 57,104                              |   |
| Accrued expenses                                                                                                                                                                |   | 39,404                            |    | 28,157                              |   |
| Accrued interest  payable                                                                                                                                                       |   | 7,068                             |    | 4,278                               |   |
| Income taxes  payable                                                                                                                                                           |   | 3,831                             |    | 811                                 |   |
| Deferred income  taxes                                                                                                                                                          |   | 936                               |    | 1,005                               |   |
| Current  maturities of long-term debt                                                                                                                                           |   | 7,487                             |    | —                              |   |
| Total current  liabilities                                                                                                                                                      |   | 150,851                           |    | 93,235                              |   |
| Long-term debt,  less current maturities                                                                                                                                        |   | 231,807                           |    | 196,972                             |   |
| Commitments and  contingencies                                                                                                                                                  |   | —                            |    | —                              |   |
| Deferred income  taxes                                                                                                                                                          |   | 29,282                            |    | 19,421                              |   |
| Other  liabilities                                                                                                                                                              |   | 26,939                            |    | 20,593                              |   |
| Total  liabilities                                                                                                                                                              |   | 438,879                           |    | 330,221                             |   |
| Shareholders’  equity:                                                                                                                                                     |   |                              |    |                                |   |
| Class A common  stock - $1.00 par value; 600,000 shares authorized, 500,019.91 issued and 492,495.79  outstanding in 2003, 455,673.11 issued and 444,344.84 outstanding in 2002 |   | 500                               |    | 456                                 |   |
| Class B  convertible common stock - $1.00 par value; 600,000 shares authorized, no  shares issued in 2003, 44,346.80 issued and outstanding in 2002                             |   | —                            |    | 44                                  |   |
| Additional  paid-in capital                                                                                                                                                     |   | 155,495                           |    | 53,220                              |   |
| Common stock in  treasury, at cost - 7,524.12 and 11,328.27 shares in 2003 and 2002,  respectively                                                                              |   | (1,964                            | )       | (2,056                              | )      |
| Restricted stock  grant                                                                                                                                                         |   | (3,381                            | )       | —                              |   |
| Retained  earnings                                                                                                                                                              |   | 14,756                            |    | 44,439                              |   |
| Accumulated  other comprehensive loss, net of tax                                                                                                                               |   | 4,544                             |    | (9,884                              | )      |
| Total  shareholders’ equity                                                                                                                                                |   | 169,950                           |    | 86,219                              |   |
|                                                                                                                                                                            |   | $                                 | 608,829 |                                | $      | 416,440 |   |

 

The accompanyingnotes are an integral part of these consolidated financial statements.

 

36

----

 

**EuramaxInternational, Inc. and Subsidiaries**

**ConsolidatedStatements of Changes in Equity**

 
| **Thousands of U.S. Dollars**                              |   | **Common  Stock** |       | **Additional  Paid-in  Capital** | ** ** | **Treasury  Stock** | ** ** | **Restricted  Stock** | ** ** | **Retained  Earnings** | ** ** | **Accumulated  Other  Comprehensive  Income (Loss)** |       | **Totals** | ** ** |
|------------------------------------------------------------|--------|-------------------|------------|----------------------------------|------------|---------------------|------------|-----------------------|------------|------------------------|------------|------------------------------------------------------|------------|------------|------------|
|                                                       |   |              | ** ** |                             | ** ** |                | ** ** |                  | ** ** |                   | ** ** |                                                 | ** ** |       | ** ** |
| Predecessor  balance at December 29, 2000                  |   | $                 | 500        |                             | $          | 53,220              |       | $                     | (1,581     | )                      | $          | —                                               |       | $          | 19,852     |   | $ | (8,210 | ) | $ | 63,781 |   |
|                                                       |   |              |       |                             |       |                |       |                  |       |                   |       |                                                 |       |       |       |
| Comprehensive  income:                                     |   |              |       |                             |       |                |       |                  |       |                   |       |                                                 |       |       |       |
| Net earnings for  2001                                     |   | —            |       | —                           |       | —              |       | —                |       | 4,730                  |       | —                                               |       | 4,730      |       |
| Foreign currency  translation adjustment                   |   | —            |       | —                           |       | —              |       | —                |       | —                 |       | (2,151                                               | )          | (2,151     | )          |
| Minimum pension  liability, net of taxes                   |   | —            |       | —                           |       | —              |       | —                |       | —                 |       | (4,501                                               | )          | (4,501     | )          |
| Loss on  derivative instruments, net of taxes              |   | —            |       | —                           |       | —              |       | —                |       | —                 |       | (365                                                 | )          | (365       | )          |
| Comprehensive  loss                                        |   |              |       |                             |       |                |       |                  |       |                   |       |                                                 |       | (2,287     | )          |
| Predecessor  balance at December 28, 2001                  |   | 500               |       | 53,220                           |       | (1,581              | )          | —                |       | 24,582                 |       | (15,227                                              | )          | 61,494     |       |
|                                                       |   |              |       |                             |       |                |       |                  |       |                   |       |                                                 |       |       |       |
| Comprehensive  income:                                     |   |              |       |                             |       |                |       |                  |       |                   |       |                                                 |       |       |       |
| Net earnings for  2002                                     |   | —            |       | —                           |       | —              |       | —                |       | 19,857                 |       | —                                               |       | 19,857     |       |
| Foreign currency  translation adjustment                   |   | —            |       | —                           |       | —              |       | —                |       | —                 |       | 6,678                                                |       | 6,678      |       |
| Minimum pension  liability, net of taxes                   |   | —            |       | —                           |       | —              |       | —                |       | —                 |       | (1,105                                               | )          | (1,105     | )          |
| Loss on  derivative instruments, net of taxes              |   | —            |       | —                           |       | —              |       | —                |       | —                 |       | (230                                                 | )          | (230       | )          |
| Comprehensive  income                                      |   |              |       |                             |       |                |       |                  |       |                   |       |                                                 |       | 25,200     |       |
| Repurchase of  common stock                                |   | —            |       | —                           |       | (475                | )          | —                |       | —                 |       | —                                               |       | (475       | )          |
| Predecessor  balance at December 27, 2002                  |   | 500               |       | 53,220                           |       | (2,056              | )          | —                |       | 44,439                 |       | (9,884                                               | )          | 86,219     |       |
|                                                       |   |              |       |                             |       |                |       |                  |       |                   |       |                                                 |       |       |       |
| Comprehensive  income:                                     |   |              |       |                             |       |                |       |                  |       |                   |       |                                                 |       |       |       |
| Net earnings for  the five months ended May 23, 2003       |   | —            |       | —                           |       | —              |       | —                |       | 6,892                  |       | —                                               |       | 6,892      |       |
| Foreign currency  translation adjustment                   |   | —            |       | —                           |       | —              |       | —                |       | —                 |       | 6,921                                                |       | 6,921      |       |
| Minimum pension  liability, net of taxes                   |   | —            |       | —                           |       | —              |       | —                |       | —                 |       | —                                               |       | —     |       |
| Gain on  derivative instruments, net of taxes              |   | —            |       | —                           |       | —              |       | —                |       | —                 |       | 100                                                  |       | 100        |       |
| Comprehensive  income                                      |   |              |       |                             |       |                |       |                  |       |                   |       |                                                 |       | 13,913     |       |
| Repurchase of  common stock                                |   | —            |       | —                           |       | (2,556              | )          | —                |       | —                 |       | —                                               |       | (2,556     | )          |
| Predecessor  balance at  May 23, 2003                      |   | 500               |       | 53,220                           |       | (4,612              | )          | —                |       | 51,331                 |       | (2,863                                               | )          | 97,576     |       |
|                                                       |   |              |       |                             |       |                |       |                  |       |                   |       |                                                 |       |       |       |
| 2003 Stock  Transaction                                    |   | —            |       | 100,821                          |       | —              |       | —                |       | (51,331                | )          | 2,863                                                |       | 52,353     |       |
| Comprehensive  income:                                     |   |              |       |                             |       |                |       |                  |       |                   |       |                                                 |       |       |       |
| Net earnings for  the seven months ended December 26, 2003 |   | —            |       | —                           |       | —              |       | —                |       | 14,756                 |       | —                                               |       | 14,756     |       |
| Foreign currency  translation adjustment                   |   | —            |       | —                           |       | —              |       | —                |       | —                 |       | 4,552                                                |       | 4,552      |       |
| Minimum pension  liability, net of taxes                   |   | —            |       | —                           |       | —              |       | —                |       | —                 |       | (83                                                  | )          | (83        | )          |
| Gain on  derivative instruments, net of taxes              |   | —            |       | —                           |       | —              |       | —                |       | —                 |       | 75                                                   |       | 75         |       |
| Comprehensive  income                                      |   |              |       |                             |       |                |       |                  |       |                   |       |                                                 |       | 19,300     |       |
| Issuance of  restricted stock from shares held in treasury |   | —            |       | 1,330                            |       | 2,498               |       | (3,828                | )          |                   |       |                                                 |       | —     |       |
| Amortization of  restricted stock                          |   | —            |       | —                           |       | —              |       | 447                   |       | —                 |       | —                                               |       | 447        |       |
| Repurchase of common  stock                                |   | —            |       | —                           |       | (80                 | )          | —                |       | —                 |       | —                                               |       | (80        | )          |
| Issuance of  common stock from shares held in treasury     |   | —            |       | 124                              |       | 230                 |       | —                |       | —                 |       | —                                               |       | 354        |       |
| Successor  balance at December 26, 2003                    |   | $                 | 500        |                             | $          | 155,495             |       | $                     | (1,964     | )                      | $          | (3,381                                               | )          | $          | 14,756     |   | $ | 4,544 |   | $ | 169,950 |   |

 

The accompanyingnotes are an integral part of these consolidated financial statements.

 

37

----

 

**EuramaxInternational, Inc. and Subsidiaries**

**ConsolidatedStatements of Cash Flows**

 
|                                                                                   |   | **Predecessor**                       |   | **Successor**                               |       | **Predecessor**                    |       |
|----------------------------------------------------------------------------------------|--------|---------------------------------------|--------|---------------------------------------------|------------|------------------------------------|------------|
| **Thousands of U.S. Dollars**                                                          |   | **Five months  ended  May 23,  2003** |   | **Seven months  ended  December 26,  2003** | ** ** | **Year ended  December 27,  2002** | ** ** | **Year ended  December 28,  2001** | ** ** |
|                                                                                   |   |                                  |   |                                        |       |                               |       |   |   |
| Cash flows from  operating activities:                                                 |   |                                  |   |                                        |       |                               |       |   |   |
| Net earnings                                                                           |   | $                                     | 6,892  |                                        | $          | 14,756                             |       | $ | 19,857 |   | $ | 4,730 |   |
| Reconciliation  of net earnings to net cash (used in) provided by operating activites: |   |                                  |   |                                        |       |                               |       |   |   |
| Depreciation and  amortization                                                         |   | 6,276                                 |   | 10,639                                      |       | 13,968                             |       | 17,555 |   |
| Amortization of  deferred finance fees                                                 |   | 563                                   |   | 1,034                                       |       | 1,319                              |       | 1,133 |   |
| Amortization of  restricted stock grants                                               |   | —                                |   | 447                                         |       | —                             |       | — |   |
| Loss on  redemption of 11.25% Notes                                                    |   | —                                |   | 2,070                                       |       | —                             |       | — |   |
| Provision for  doubtful accounts                                                       |   | 212                                   |   | 600                                         |       | (177                               | )          | 1,763 |   |
| Foreign exchange  (gain) loss                                                          |   | (405                                  | )      | (1,343                                      | )          | (796                               | )          | (204 | ) |
| Loss (gain) on  sale of assets                                                         |   | (32                                   | )      | (1                                          | )          | 552                                |       | 124 |   |
| Deferred income  taxes                                                                 |   | 2,162                                 |   | (1,078                                      | )          | 4,274                              |       | 29 |   |
| Changes in  operating assets and liabilities (excluding acquisitions):                 |   |                                  |   |                                        |       |                               |       |   |   |
| Accounts  receivable                                                                   |   | (22,778                               | )      | 3,009                                       |       | (5,203                             | )          | (7,150 | ) |
| Inventories                                                                            |   | (13,014                               | )      | 16,781                                      |       | (11,197                            | )          | 16,007 |   |
| Other current  assets                                                                  |   | (1,908                                | )      | 2,247                                       |       | 294                                |       | 716 |   |
| Accounts payable  and other current liabilities                                        |   | 9,225                                 |   | 23,112                                      |       | 6,892                              |       | 2,823 |   |
| Income taxes  payable                                                                  |   | 3,664                                 |   | (1,605                                      | )          | (2,516                             | )          | (4,861 | ) |
| Other noncurrent  assets and liabilities                                               |   | (2,902                                | )      | 6,341                                       |       | (1,849                             | )          | 2,836 |   |
| Net cash  provided by (used in) operating activities                                   |   | (12,045                               | )      | 77,009                                      |       | 25,418                             |       | 35,501 |   |
| Cash flows from  investing activities:                                                 |   |                                  |   |                                        |       |                               |       |   |   |
| Proceeds from  sale of assets                                                          |   | 35                                    |   | 293                                         |       | 492                                |       | 1,164 |   |
| Purchases of  businesses, less cash acquired                                           |   | —                                |   | (35,256                                     | )          | —                             |       | — |   |
| Capital  expenditures                                                                  |   | (4,944                                | )      | (5,129                                      | )          | (8,263                             | )          | (8,321 | ) |
| Net cash used in  investing activities                                                 |   | (4,909                                | )      | (40,092                                     | )          | (7,771                             | )          | (7,157 | ) |
| Cash flows from  financing activities:                                                 |   |                                  |   |                                        |       |                               |       |   |   |
| Changes in cash  overdrafts                                                            |   | 2,603                                 |   | (4,477                                      | )          | 461                                |       | (290 | ) |
| Net borrowings  (repayments) on revolving credit facility                              |   | 18,264                                |   | (81,679                                     | )          | 23,808                             |       | (2,774 | ) |
| Repayment of  long-term debt, including premium                                        |   | —                                |   | (138,532                                    | )          | (38,952                            | )          | (22,989 | ) |
| Issuance of long-term  debt                                                            |   | —                                |   | 234,990                                     |       | —                             |       | — |   |
| Proceeds from  settlement of currency agreements                                       |   | —                                |   | —                                      |       | 2,790                              |       | — |   |
| Payment to  terminate interest rate swap                                               |   | —                                |   | —                                      |       | —                             |       | (3,160 | ) |
| Expenses  relating to the 2003 Stock Transaction                                       |   | —                                |   | (3,171                                      | )          |                               |       |   |   |
| Issuance of  common stock from shares held in treasury                                 |   | —                                |   | 354                                         |       | —                             |       | — |   |
| Deferred finance  fees                                                                 |   | (116                                  | )      | (12,140                                     | )          | (1,530                             | )          | (405 | ) |
| Purchases of  treasury stock                                                           |   | (2,556                                | )      | (80                                         | )          | (475                               | )          | — |   |
| Net cash  provided by (used in) financing activities                                   |   | 18,195                                |   | (4,735                                      | )          | (13,898                            | )          | (29,618 | ) |
| Effect of  exchange rate changes on cash                                               |   | 778                                   |   | 2,380                                       |       | 2,000                              |       | (963 | ) |
| Net increase  (decrease) in cash and cash equivalents                                  |   | 2,019                                 |   | 34,562                                      |       | 5,749                              |       | (2,237 | ) |
| Cash and cash  equivalents at beginning of period                                      |   | 11,646                                |   | 13,665                                      |       | 5,897                              |       | 8,134 |   |
| Cash and cash  equivalents at end of period                                            |   | $                                     | 13,665 |                                        | $          | 48,227                             |       | $ | 11,646 |   | $ | 5,897 |   |
|                                                                                   |   |                                  |   |                                        |       |                               |       |   |   |
| Supplemental  cash flow information:                                                   |   |                                  |   |                                        |       |                               |       |   |   |
| Income taxes  paid, net                                                                |   | $                                     | 1,261  |                                        | $          | 5,525                              |       | $ | 9,471 |   | $ | 9,512 |   |
| Interest paid,  net                                                                    |   | $                                     | 9,610  |                                        | $          | 6,910                              |       | $ | 20,958 |   | $ | 22,390 |   |

 

The accompanyingnotes are an integral part of these consolidated financial statements.

 

38

----

 

**EuramaxInternational, Inc. and Subsidiaries**

**Notes toConsolidated Financial Statements**

**(Thousandsof U.S. Dollars except share data)**

 

**1.  Basis of Presentation:**

 

For purposes of this report, the “Company” and “Euramax” refers toEuramax International, Inc. and Subsidiaries, collectively.

 

Euramax International, Inc. is an international producer of value-addedaluminum, steel, vinyl and fiberglass fabricated products with facilitiesstrategically located in all major regions of the continental United States, orU.S., the United Kingdom, or U.K., The Netherlands and France. The Company’smanufacturing and distribution network consists of 43 strategically locatedfacilities, of which 37 are located in the U.S. and six are located in Europe.The Company sells its products principally to two markets, the building andconstruction market and the transportation market. The Company’s core productsinclude specialty coated coils, aluminum recreational vehicle, or RV,sidewalls, RV doors, farm and agricultural panels, metal and vinyl raincarryingsystems, soffit and fascia systems, and vinyl replacement windows. In addition,the Company sells an extensive line of accessory products, including roofingand siding hardware, trim parts and roof drainage accessories. The Company’scustomers include original equipment manufacturers, or OEMs, such as RVmanufacturers, commercial panel manufacturers and transportation industrymanufacturers; rural contractors; home centers; home improvement contractors;distributors; industrial and architectural contractors; and manufacturedhousing producers. The Company’s sales are somewhat seasonal, with the secondand third quarters typically accounting for the highest sales volumes.

 

Per share data has not been presented since such data provides nouseful information as the shares of the Company are closely held.

 

Certain 2002 amounts have been reclassified to conform to current yearpresentation.

 

**2.  Summary of Significant Accounting Policies:**

 

**Principlesof Consolidation**

 

The consolidated financial statements of the Company are prepared inconformity with accounting principles generally accepted in the United Statesand include the accounts of the Company and all its subsidiaries. Allsignificant intercompany accounts and transactions have been eliminated inconsolidation.

 

**FiscalYear**

 

The Company operates on a 52 or 53 week fiscal year ending on the lastFriday in December. The Company’s fiscal years consisted of 52 weeks for theyears ended December 26, 2003, December 27, 2002 and December 28, 2001,respectively.

 

**Use ofEstimates and Assumptions**

 

The preparation of financial statements in conformity with accountingprinciples generally accepted in the United States requires management to makeestimates and assumptions that may affect the reported amounts of certainassets and liabilities and disclosure of contingencies at the date of thefinancial statements and the reported amounts of revenues and expenses duringthe reporting period.  Although theseestimates and assumptions are based on the Company’s knowledge of currentevents and actions the Company may take in the future, actual results couldultimately differ from those estimates and assumptions, and the differencescould be material.

 

39

----

 

**Cash andCash Equivalents**

 

The Company considers all highly liquid investments with an initialmaturity of three months or less to be cash equivalents. Certain cashoverdrafts of the Company have been netted with positive cash balances heldwith the same financial institutions.

 

**Inventories**

 

Inventories are stated at the lower of cost or market, with costdetermined under the first-in, first-out (“FIFO”) method.

 

**Property,Plant and Equipment**

 

Property, plant and equipment is recorded at cost. Repair andmaintenance costs are generally expensed unless they extend the useful lives ofassets. Depreciation and amortization of property, plant and equipment iscomputed principally on the straight-line method over the estimated usefullives of the assets ranging from 5 to 10 years for equipment and25 years for buildings. Gains or losses related to the disposition ofproperty, plant and equipment are charged to other income or expense whenincurred. Also, when events or changes in circumstances indicate that thecarrying value of an asset may not be recoverable, management assesses whetherthere has been a permanent impairment in the value of the asset by comparingthe estimated undiscounted future cash flows expected to result from the use ofthe asset and its eventual disposition to the carrying amount of the asset. Ifthe expected future cash flows are less than the carrying amount of the asset,an impairment loss is recognized.

 

**Goodwill**

 

Goodwill increased $65.6 million from December 27, 2002 to December 26,2003, primarily as a result of the 2003 Stock Transaction, as described in Note3, the acquisition of Berger Holdings, Ltd., as described in Note 4, andchanges in foreign exchange rates used in converting the local currencygoodwill balance into U.S. Dollars.

 

The Company adopted SFAS No. 142, “Goodwill and Other IntangibleAssets”, effective December 29, 2001. Under SFAS No. 142, goodwill andindefinite lived tangible assets are no longer amortized, but are reviewed atleast annually for impairment on the first day of the Company’s fiscal fourthquarter. The Company completed its annual impairment test and did not identifyany impairment and is not aware of any subsequent developments that wouldindicate impairment. Prior to 2002, goodwill was amortized on a straight-linebasis over periods ranging from 20 to 30 years. Had the Company been accountingfor its goodwill under SFAS No. 142 for all periods presented, the Company’snet earnings would have been as follows:

 
|                               |   | **Predecessor**                        |   | **Successor**                                |       | **Predecessor**                     |       |
|------------------------------------|--------|----------------------------------------|--------|----------------------------------------------|------------|-------------------------------------|------------|
|                               |   | **Five  months  ended  May 23,  2003** |   | **Seven  months  ended  December 26,  2003** | ** ** | **Year  ended  December 27,  2002** | ** ** | **Year  ended  December 28,  2001** | ** ** |
|                               |   |                                   |   |                                         |       |                                |       |   |   |
| Reported net  earnings             |   | $                                      | 6,892  |                                         | $          | 14,756                              |       | $ | 19,857 |   | $ | 4,730 |   |
| Goodwill  amortization, net of tax |   | —                                 |   | —                                       |       | —                              |       | 3,907 |   |
| Adjusted net  earnings             |   | $                                      | 6,892  |                                         | $          | 14,756                              |       | $ | 19,857 |   | $ | 8,637 |   |

 

40

----

 

**FinancialInstruments and Risk Management**

 

SFAS No. 133, “Accounting for Derivative Instruments and HedgingActivities”, as amended by SFAS No. 137, SFAS No. 138 and SFAS No. 149,requires companies to recognize all derivative instruments on the balance sheetat fair value. The accounting for changes in the fair value of a derivativeinstrument depends on whether it has been designated and qualifies as part of ahedging relationship and further, on the type of hedging relationship. Forthose derivative instruments that are designated and qualify as hedginginstruments, a company must designate the hedging instrument, based upon theexposure being hedged, as a fair value hedge, cash flow hedge or a hedge of netinvestment in a foreign operation. For derivative instruments that aredesignated and qualify as a fair value hedge, the gain or loss on thederivative instrument as well as the offsetting gain or loss on the hedged itemattributable to the hedged risk are recognized in current earnings during theperiod of the change in fair values. For derivative instruments that aredesignated and qualify as a cash flow hedge, the effective portion of the gainor loss on the derivative instrument is reported as a component of othercomprehensive income and reclassified into earnings in the same period orperiods during which the hedged transaction affects earnings. The remaininggain or loss on the derivative instrument in excess of the cumulative change inthe present value of future cash flows of the hedged item, if any, isrecognized in current earnings during the period of change. For derivativeinstruments that are designated and qualify as a hedge of a net investment in aforeign operation, the gain or loss is reported in other comprehensive incomeas part of the cumulative translation adjustment to the extent it is effective.For derivative instruments not designated as hedging instruments, the gain orloss is recognized in current earnings during the period of change. Should anagreement be terminated while the underlying remains outstanding, the gain orloss would be deferred and amortized over the shorter of the remaining life ofthe underlying or the agreement.

 

The Company uses derivative financial instruments primarily to reduceits exposure to fluctuations in interest rates and foreign exchange rates and,to a lesser extent, to reduce its exposure to fluctuations in commodity prices.When entered into, the Company formally designates and documents the financialinstrument as a hedge of a specific underlying exposure, as well as the riskmanagement objectives and strategies for undertaking the hedge transaction.Derivatives are recorded in the balance sheet at fair value in either otherassets or other liabilities. The earnings impact resulting from the derivativeinstruments is recorded in the same line item within the statement of earningsas the underlying exposure being hedged. The Company also formally assesses,both at the inception and at least quarterly thereafter, whether the financialinstruments that are used in hedging transactions are effective at offsettingchanges in either the fair value or cash flows of the related underlyingexposures. The ineffective portion of a financial instrument’s change in fair valueis immediately recognized in earnings as other income (expense).

 

**StockBased Compensation**

 

As permitted by SFAS No. 123, “Accounting for Stock-BasedCompensation”, as amended by SFAS No. 148, the Company has elected to apply APBNo. 25, “Accounting for Stock Issued to Employees” and related interpretationsin accounting for stock options issued under its equity compensation plan, asdescribed in Note 9. Had compensation expense related to these stock optionsbeen determined based upon the fair value method under SFAS No. 123, net incomewould have been impacted as follows:

 

41

----

 
|                     |                                                                                                                           | **Predecessor**                        |   | **Successor**                                | ** ** | **Predecessor**                     | ** ** |
|--------------------------|--------------------------------------------------------------------------------------------------------------------------------|----------------------------------------|--------|----------------------------------------------|------------|-------------------------------------|------------|
|                     |                                                                                                                           | **Five  months  ended  May 23,  2003** |   | **Seven  months  ended  December 26,  2003** | ** ** | **Year  ended  December 27,  2002** | ** ** | **Year  ended  December 28,  2001** | ** ** |
|                     |                                                                                                                           |                                   |   |                                         |       |                                |       |   |   |
| Net income, as  reported |                                                                                                                           | $                                      | 6,892  |                                         | $          | 14,756                              |       | $ | 19,857 |   | $ | 4,730 |   |
| Add:                     | Stock-based employee compensation cost included in  reported net income, net of related tax effects                            |                                   | — |                                         | 143        |                                | —     |   | — |   |
| Less:                    | Total stock-based employee compensation expense  determined under fair value method for all awards, net of related tax effects |                                   | — |                                         | (250       | )                                   | —     |   | — |   |
|                     |                                                                                                                           |                                   |   |                                         |       |                                |       |   |   |
| Pro forma net  income    |                                                                                                                           | $                                      | 6,892  |                                         | $          | 14,649                              |       | $ | 19,857 |   | $ | 4,730 |   |

 

The fair value of each option is estimated using the Black-Scholesoption-pricing model using a risk free interest rate of 3.20%, an expectedoption life of 5 years, no volatility and no dividends.

 

**RevenueRecognition**

 

The Company recognizes revenue when persuasive evidence of an agreementexists, delivery has occurred, the Company’s price to the buyer is fixed anddeterminable and collectibility is reasonably assured. Delivery is notconsidered to have occurred until the customer takes title and assumes therisks and rewards of ownership. The timing of revenue recognition is largelydependant on shipping terms. Revenue is recognized at the time of shipment forterms designated f.o.b. shipping point. Revenue is recognized upon delivery tothe customer’s delivery site for terms designated f.o.b. destination.

 

The Company provides warranties on certain products. The warrantyperiods differ depending on the product, but generally range from one year tolimited lifetime warranties. The Company provides accruals for warranties basedon historical experience and expectations of future occurrence.

 

**Shippingand Handling Costs**

 

The Company classifiesall shipping and handling charges as cost of goods sold.

 

**Translationof Foreign Currencies**

 

Assets and liabilities of non-U.S. subsidiaries are translated to U.S.Dollars at the rate of exchange in effect on the balance sheet date; income andexpenses are translated to U.S. Dollars at the weighted average rates ofexchange prevailing during the year. Foreign currency gains and losses resultingfrom transactions and for the remeasurement of amounts that are not of along-term investment nature into local currencies are included in results ofoperations. The foreign currency transaction gains (losses) recorded in sellingand general expenses were not significant for the years ended December 26,2003, December 27, 2002 and December 28, 2001.

 

**ComprehensiveIncome**

 

Total comprehensive income and the components of accumulated othercomprehensive income are presented in the Consolidated Statements of Changes inEquity. The related tax effects of the components of comprehensive income are

 

42

----

 

presented in Note 11.

 

**RecentAccounting Pronouncements**

 

In April 2002, the Financial Accounting Standards Board, or FASB,issued Statement of Financial Accounting Standards No. 145, “Rescission of FASBStatements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and TechnicalCorrections”, or SFAS No. 145. Among other items, SFAS No. 145 updates andclarifies existing accounting pronouncements related to reporting gains andlosses from the extinguishment of debt and certain lease modifications thathave economic effects similar to sale-leaseback transactions. SFAS No. 145became effective for the Company on the first day of fiscal year 2003. TheCompany recorded interest expense and other expense, net of tax, ofapproximately $0.4 million and $1.0 million, respectively. These itemsrepresent unamortized deferred finance fees and the amounts paid in excess of thecarrying value of the retired debt related to the senior subordinated notespurchased or redeemed as described in Note 7. Prior to the adoption of SFAS No. 145, the Company would have recognizedthis amount as an extraordinary loss, net of tax.

 

In December 2002, the FASB issued Statement No. 148, “Accounting forStock-Based Compensation, Transition and Disclosure”, or SFAS No. 148. SFAS No.148 provides alternative methods of transition for a voluntary change to thefair value based method of accounting for stock-based employee compensation.SFAS No. 148 also amends the disclosure requirements of SFAS No. 123 to requireprominent disclosure in both annual and interim financial statements about themethod of accounting for stock-based compensation and the pro forma effect onnet income had the fair value of the options been expensed. The disclosurerequirements of SFAS No. 148 became effective at its issuance. The adoption ofSFAS No. 148 did not have a material impact on the Company’s financial positionor results of operations in fiscal year 2003.

 

In January 2003, the FASB issued Interpretation No. 46, “Consolidationof Variable Interest Entities”, or FIN 46, which addresses consolidation ofvariable interest entities. FIN 46 requires a variable interest entity to beconsolidated by a parent company if that company is subject to a majority ofthe risk of loss from the variable interest entity’s activities or entitled toreceive a majority of the entity’s residual returns or both. A variableinterest entity is a corporation, partnership, trust or any other legalstructure used for business purposes that either does not have equity investorswith voting rights or has equity investors that do not provide sufficientfinancial resources for the entity to support its activities. The consolidation requirements of FIN 46apply immediately to variable interest entities created after January 31,2003.  For older entities, theserequirements will begin to apply in the first fiscal year or interim periodbeginning after December 15, 2003.  TheCompany is currently evaluating FIN 46, but the adoption of FIN 46 is notexpected to have a material impact on the Company’s financial position orresults of operations in fiscal year 2004.

 

In April 2003, the FASB issued Statement No.149, “Amendment of Statement 133 on Derivative Instruments and HedgingActivities”, or SFAS No. 149. SFAS No. 149 clarifies under what circumstances acontract with an initial net investment meets the characteristics of aderivative, amends the definition of an underlying contract and clarifies whena derivative contains a financing component in order to increase thecomparability of accounting practices under SFAS No. 133, “Accounting forDerivative Instruments and Hedging Activities”. SFAS No. 149 is effective forcontracts entered into or modified after June 30, 2003, and for hedgingrelationships designated after June 30, 2003. The adoption of SFAS No. 149 didnot have a material impact on the Company’s financial position or results ofoperations in fiscal year 2003.

 

In December 2003, the FASB issued Statement No. 132 (revised 2003),“Employers’ Disclosures about Pensions and Other Post Retirement Benefits”, orSFAS No. 132 (revised 2003).  SFAS No.132 (revised 2003) requires additional disclosures to those in the originalStatement No. 132 about the assets, obligations, cash flows and net periodiccost of defined benefit plans and other defined benefit postretirementplans.  The Company’s disclosures in Note12 incorporate the additional disclosures required by SFAS No. 132 (revised2003).

 

**3.  2003 Stock Transaction:**

 

On April 15, 2003, Citigroup Venture Capital Equity Partners, L.P.,(“CVCEP”), and Citigroup Venture Capital Ltd., (“CVC”), entered into adefinitive purchase agreement with CVC European Equity Partners, L.P. and CVCEuropean Equity Partners (Jersey), L.P., collectively (“CVC Europe”), BNPParibas, independent directors and certain members of management to purchase,for approximately $106.0 million, all of the shares of the Company held by CVCEurope and BNP Paribas, and a portion of the shares held by independentdirectors and management, (“2003 Stock Transaction”). The 2003 Stock

 

43

----

 

Transaction was completed on June 12, 2003, with CVCEP purchasing265,762.48 shares of the Company’s Class A common stock. For accountingpurposes, the Company has used May 23, 2003, its May month-end, as thetransaction date. After the completion of this transaction CVCEP and CVCcollectively owned approximately 88.5% of the issued and outstanding shares ofthe Company, with management of CVCEP and directors and management of theCompany holding the remaining shares. Prior to the 2003 Stock Transaction, CVCowned approximately 34.5% of the issued and outstanding shares of the Company.CVCEP is ultimately controlled by Citigroup, Inc. through limited and generalpartnership interests owned by its subsidiaries. CVC Europe is a group oflimited partnerships in which Citigroup, Inc. owns a minority interest, butdoes not have management rights or control rights.

 

The substantial change in ownership arising from CVCEP’s acquisition ofthe Company’s stock, together with the Company’s subsequent issuance of seniorsubordinated notes (see Note 7) required that the purchase price paid in excessof the book value of the Company’s equity acquired be allocated under thepurchase method of accounting to the assets and liabilities of the Companybased upon a percentage of their fair values proportional to the percentage ofthe ownership change. The allocation was based upon preliminary estimates bymanagement of the fair market values of identifiable assets and liabilities,with the remainder allocated to goodwill. The liabilities assumed includedapproximately $3.8 million of fees related to the transaction, which are beingpaid by the Company on behalf of its shareholders. The Company is currentlycompleting valuations of its property, plant and equipment and intangibleassets.  The final allocation of thepurchase price, which is subject to revision when these valuations arecompleted, may materially differ from the preliminary estimates. The goodwillgenerated from this transaction is not deductible for income tax purposes. Thepurchase price has been preliminarily allocated as follows:

 
| Purchase price                                                                     |   | $      | 105,981 |   |
|------------------------------------------------------------------------------------|--------|--------|---------|--------|
| Less: Company  equity acquired                                                     |   | 53,628 |    |
| Increase in  basis                                                                 |   | $      | 52,353  |   |
|                                                                               |   |   |    |
| Allocation of  increase in basis                                                   |   |   |    |
| Record fair  value of inventories                                                  |   | $      | 4,000   |   |
| Record fair  value of property, plant and equipment                                |   | 16,000 |    |
| Record fair  value of senior subordinated notes                                    |   | (2,040 | )       |
| Record fair  value of deferred financing fees                                      |   | (1,000 | )       |
| Record fair  value of patent (15 year life)                                        |   | 2,500  |    |
| Transaction fees                                                                   |   | (3,835 | )       |
| Record income  taxes for effect of step-up in basis of assets and transaction fees |   | (6,270 | )       |
| Increase to  goodwill, net                                                         |   | 42,998 |    |
|                                                                               |   | $      | 52,353  |   |

 

The following unaudited pro-forma information presents the results ofoperations of the Company as if the 2003 Stock Transaction had occurred as ofthe beginning of the period presented. The pro-forma information is notnecessarily indicative of what would have occurred had the 2003 StockTransaction been completed at that time, nor is it indicative of future resultsof operations. The pro-forma amounts give effect to appropriate adjustments forthe fair value of the assets acquired, liabilities assumed, amortization ofproperty, plant and equipment, intangibles and restricted stock, incurrence ofthe advisory fees owed to CVC Management and income taxes.

 
|                    |   | **Five months  ended  May 23,  2003** |    | **Seven  months  ended  December 26,  2003** | ** ** | **Year ended  December 27,  2002** | ** ** | **Year ended  December 28,  2001** | ** ** |
|-------------------------|--------|---------------------------------------|---------|----------------------------------------------|------------|------------------------------------|------------|------------------------------------|------------|
|                    |   |                                  |    |                                         |       |                               |       |                               |       |
| Pro-forma net  sales    |   | $                                     | 260,615 |                                         | $          | 483,688                            |       | $                                  | 639,149    |   | $ | 593,117 |   |
| Pro-forma net  earnings |   | $                                     | 6,319   |                                         | $          | 14,936                             |       | $                                  | 18,172     |   | $ | 3,486 |   |

 

44

----

 

**4.  Acquisitions:**

 

On November 18, 2003, pursuant to a tender offer, AmerimaxPennsylvania, Inc., a wholly owned subsidiary of Euramax, acquired 93% ofBerger Holdings’ outstanding common shares for $3.90 per share. The acquisitionof Berger Holdings was completed on November 25, 2003 by the merger of AmerimaxPennsylvania, Inc. into Berger Holdings, with Berger Holdings as the survivorcorporation. As a result of the merger, each common share of Berger Holdingsnot owned by Euramax was converted into the right to receive $3.90 per share incash, subject to dissenter’s rights. The total purchase price of thisacquisition was approximately $36.8 million. The Company has allocated thepurchase price in excess of the net assets acquired to Berger Holdings’ assetsand liabilities under the purchase method of accounting based on preliminaryestimates of fair market values of identifiable assets and liabilities, withthe remainder allocated to goodwill. The Company is currently completingvaluations of Berger Holdings’ assets, including property, plant and equipmentand intangible assets, and liabilities. The final allocation of the purchaseprice, which is subject to revision when these valuations are completed, maymaterially differ from the preliminary allocation. Berger Holdings manufacturesmetal roof drainage products and roofing accessories as well as residential andcommercial snow guards and is included in our U.S. Fabrication Roof Drainagesegment. The results of operations of Berger Holdings are included in theCompany’s consolidated statement of earnings from the acquisition date.

 

**5.  Inventories:**

 

Inventories were comprised of:

 
|               |   | **Successor  December 26,  2003** |   | **Predecessor  December 27,  2002** |   |
|--------------------|--------|-----------------------------------|--------|-------------------------------------|--------|
|               |   |                              |   |                                |   |
| Raw materials      |   | $                                 | 61,832 |                                | $      | 60,281 |   |
| Work in process    |   | 8,075                             |   | 2,587                               |   |
| Finished  products |   | 19,636                            |   | 15,612                              |   |
|               |   | $                                 | 89,543 |                                | $      | 78,480 |   |

 

Inventories are net of related reserves totaling $3,581 at December 26,2003 and $3,827 at December 27, 2002.

 

**6.  Property, Plant and Equipment:**

 

Components of property, plant and equipment were as follows:

 

45

----

 
|                           |   | **Successor  December 26,  2003** |    | **Predecessor  December 27,  2002** | ** ** |
|--------------------------------|--------|-----------------------------------|---------|-------------------------------------|------------|
|                           |   |                              |    |                                |       |
| Land and  improvements         |   | $                                 | 12,205  |                                | $          | 9,544 |   |
| Buildings                      |   | 54,870                            |    | 45,774                              |       |
| Machinery and  equipment       |   | 116,864                           |    | 118,621                             |       |
|                           |   | 183,939                           |    | 173,939                             |       |
| Less accumulated  depreciation |   | (44,463                           | )       | (67,032                             | )          |
|                           |   | 139,476                           |    | 106,907                             |       |
| Construction in  progress      |   | 1,961                             |    | 5,130                               |       |
|                           |   | $                                 | 141,437 |                                | $          | 112,037 |   |

 

Depreciation expensewas $6.2 million, $10.5 million, $13.8 million, and $12.6 million for the fivemonths ended May 23, 2003, the seven months ended December 26, 2003 and yearsended December 27, 2002 and December 28, 2001, respectively.

 

**7.  Long-Term Obligations:**

 

Long-term obligations consisted of the following:

 
|                                       |   | **Successor  December 26,  2003** |    | **Predecessor  December 27,  2002** |   |
|--------------------------------------------|--------|-----------------------------------|---------|-------------------------------------|--------|
| Senior Secured  Credit Facility:           |   |                              |    |                                |   |
| Revolving Credit  Facility                 |   | $                                 | —  |                                | $      | 61,972 |   |
| Term Loans                                 |   | 36,559                            |    | —                              |   |
| 8.5% Senior  Subordinated Notes due 2011   |   | 200,000                           |    | —                              |   |
| 11.25% Senior  Subordinated Notes due 2006 |   | —                            |    | 135,000                             |   |
| Mortgage Note  Payable                     |   | 2,252                             |    | —                              |   |
| Capital Lease  Obligations                 |   | 483                               |    | —                              |   |
|                                       |   | 239,294                           |    | 196,972                             |   |
| Less current  maturities                   |   | (7,487                            | )       | —                              |   |
|                                       |   | $                                 | 231,807 |                                | $      | 196,972 |   |

 

On July 10, 2003, the Company commenced an offer to purchase and asolicitation of consents for any and all of its outstanding 11.25% seniorsubordinated notes due 2006 (the “11.25% Notes”).  On August 6, 2003, Euramax International, Inc. and EuramaxInternational Holdings B.V. (each a Co-Obligor) issued $200.0 million 8.50%senior subordinated notes due 2011 (the “8.50% Notes”).  On August 8, 2003, the Company purchasedapproximately $112.9 million of the $135.0 million aggregate principal amountof the 11.25% Notes, for approximately $120.4 million, including premium andaccrued interest. On October 1, 2003, the remaining $22.1 million in aggregateprincipal amount of the 11.25% Notes was redeemed for approximately $23.8million, including premium and accrued interest.  The remaining proceeds from the issuance of the 8.50% Notes wereused to cover fees and expenses from the issuance of the 8.50% Notes and torepay the existing indebtedness under the revolving credit facility.

 

Euramax International,Inc. and Euramax International Holdings, B.V., a newly acquired Netherlandsholding company, are each co-obligors on the 8.50% Notes. Each of EuramaxInternational, Inc.’s U.S. subsidiaries are guarantors of the 8.50% Notes. The8.50% Notes mature on August 15, 2011. Interest on the 8.50% Notes is payablesemi-annually in arrears on February 15 and August 15 of each year. The 8.50%Notes may be redeemed at the option of the Company, in whole or in part, underthe conditions as specified in the indenture plus accrued and unpaid interestto the redemption due, at

 

46

----

 

the followingredemption prices if redeemed during the 12-month period beginning August 15 ofthe years indicated:

 
| **Year**             |   | **Percentage** |   |
|----------------------|--------|----------------|--------|
| 2007                 |   | 104.250        | %      |
| 2008                 |   | 102.125        | %      |
| 2009 and  thereafter |   | 100.000        | %      |

 

Additionally, at anytime on or before August 15, 2006, the issuers may redeem up to 35% of theaggregate principal amount of the 8.50% Notes with the proceeds of qualifiedequity offerings at a redemption price equal to 108.5% of the principal amountplus accrued and unpaid interest. Upon a change of control, the Company may berequired to offer to purchase the 8.50% Notes at a purchase price equal to 101%of the principal amount plus accrued and unpaid interest. However, the seniorsecured credit facility limits the amount of 8.50% Notes the Company canpurchase prior to repayment of the borrowings under the senior secured creditfacility.

 

The 8.50% Notes are unsecured obligations and are effectivelysubordinated to all existing and future secured debt of the Company, includingall of the obligations under the senior secured credit facility, and allliabilities of the co-obligors non-U.S. subsidiaries.

 

The indenture to the8.50% Notes contains certain covenants that limit the Company’s ability to,among other things: incur indebtedness; make certain restricted payments; paycertain dividends, make certain distributions, make loans and transferproperty; incur liens; issue or sell capital stock; enter into transactionswith affiliates; and consolidate, merge or sell all or substantially all of theCompany’s assets. The Company is in compliance with the covenants of theindenture to the 8.50% Notes as of December 26, 2003.

 

Asrequired under a registration rights agreement executed as part of the offeringof the 8.50% Notes, the Company has commenced an offer to exchange the 8.50%Notes for new notes (“New Notes”), with terms substantially identical to the8.50% Notes, except the New Notes are registered under the Securities Act of1933 and the transfer restrictions and registration rights applicable to the8.50% Notes do not apply to the New Notes. The Securities and Exchange Commission deemed the Company’s registrationof the New Notes on Form S-4 effective on March 1, 2004.

 

On October 9, 2003,the Company amended and restated its senior secured credit facility with itslenders. As amended and restated the senior secured credit facility includes a$110.0 million revolving credit facility and a $35.0 million term loan. TheCompany borrowed the $35.0 million term loan on October 31, 2003. The interestrates applicable to the loans under the amended and restated senior securedcredit facility are based upon a Base Rate or Eurocurrency Rate (both as definedin the amended and restated senior secured credit facility), plus theirrespective margins. The Company’s amended and restated senior secured creditfacility provides for variable rate margins, determined quarterly, based uponthe Company’s ratio of EBITDA (as defined in the amended and restated seniorsecured credit facility) to total debt. The maximum and minimum Base Ratemargins are 2.00% and 1.00%, respectively, on the revolving credit facility.The maximum and minimum Eurocurrency Rate margins are 3.00% and 2.25%,respectively, on the revolving credit facility, and 3.25% and 2.50%,respectively, on the term loan. The Company is subject to a commitment fee on aquarterly basis equal to 0.375% of the unused portion of the revolving creditfacility. At December 26, 2003, the interest rate payable under the amended andrestated senior secured credit facility averaged 6.603%, compared to 4.821% atDecember 27, 2002. Loans under the amended and restated senior secured creditfacility are made, at the election of the Company, in U.S. Dollars, Eurosor British Pounds. Borrowings are repaid in the currency in which the loan ismade. Outstanding loans under the amended and restated senior secured creditfacility are to be repaid by October 8, 2008. Substantially all assets of theCompany are pledged as collateral against the borrowings under the amended andrestated senior secured credit facility.

 

The amended andrestated senior secured credit facility contains certain covenants andrestrictions on the Company’s actions, including certain restrictions on thepayment of cash dividends. In addition, the amended and restated senior secured

 

47

----

 

credit facilityrequires the Company to meet certain financial tests, including a fixed chargecoverage ratio, minimum interest coverage ratio, maximum leverage ratio andmaximum amounts of capital expenditures. The Company is in compliance with thecovenants and restrictions of the amended and restated senior secured creditfacility as of December 26, 2003.

 

As of December 26, 2003, the entire $110.0 million was undrawn underthe revolving credit facility, of which $100.8 million was available as aresult of the Company’s borrowing base limitations. During 2003, borrowings underthe senior secured credit facility increased $3.0 million due to fluctuationsin foreign exchange rates, offset by repayments of $28.4 million. In 2002,borrowings under the senior secured credit facility increased $4.4 million dueto fluctuations in foreign exchange rates, offset by repayments of $15.1million.

 

Berger Bros Company, a U.S. subsidiary of Euramax that was acquired onNovember 25, 2003, had $2.3 million outstanding under a note payable as ofDecember 26, 2003. The note payable accrues interest at a rate of 7.25%.Principal and interest are paid monthly in equal installments totalingapproximately $0.3 million annually, with final payment of the remainingoutstanding principal due in June 2008. The note payable is secured by amortgage of Berger Bros. Company’s Feasterville, Pennsylvania location.

 

Future maturities of long-term debt and capital lease obligations as ofDecember 26, 2003 are as follows:

 
|       |   | **Long-Term  Debt** |    | **Capital  Lease** |   | **Total** |   |
|------------|--------|---------------------|---------|--------------------|--------|-----------|--------|
| 2004       |   | $                   | 7,221   |               | $      | 266       |   | $ | 7,487 |   |
| 2005       |   | 7,496               |    | 177                |   | 7,673     |   |
| 2006       |   | 7,510               |    | 29                 |   | 7,539     |   |
| 2007       |   | 5,697               |    | 11                 |   | 5,708     |   |
| 2008       |   | 10,887              |    | —             |   | 10,887    |   |
| Thereafter |   | 200,000             |    | —             |   | 200,000   |   |
|       |   | $                   | 238,811 |               | $      | 483       |   | $ | 239,294 |   |

 

**8.  Financial Instruments**

 

In January 2002, the Company entered into an interest rate agreement,or the Interest Rate Swap, whereby the Company pays a counterparty a fixed rateof interest of 3.715% on a notional amount of $35.0 million through December31, 2002, $25.0 million from January 1, 2003 through December 31, 2003, and$15.0 million from January 1, 2004 through December 31, 2004. In exchange, theCompany receives a floating rate of interest of 3-month U.S. Dollar LIBOR on anequivalent notional amount. The Interest Rate Swap was designated as a cashflow hedge that effectively converted a portion of the Company’s U.S. Dollarfloating rate debt into fixed rate debt. On August 8, 2003, the Company usedthe proceeds from the issuance of the 8.50% Notes to repay its outstandingindebtedness under the senior secured credit facility. As a result of this repayment,the Interest Rate Swap became an ineffective hedge and no longer qualified forhedge accounting. The balance on the Interest Rate Swap of $0.1 millionremaining in other comprehensive income on the date it became ineffective willbe amortized into earnings over the original term of the agreement as otherincome. Changes in fair market value on the Interest Rate Swap subsequent to itbecoming ineffective are recognized in current earnings during the period ofchange. During the seven months ended December 26, 2003, the loss recognized inother income related to the ineffectiveness of the Interest Rate Swap was notsignificant. As of December 26, 2003, the Company had recorded a liability forthe fair value of the Interest Rate Swap, as estimated by a third party, of$0.5 million.

 

In February 2002, the Company entered into a British Poundcross-currency swap agreement, or the British Pound Swap.

 

48

----

 

The terms of the British Pound Swap expire on June 30, 2005, andrequire the Company to pay 19.0 million British Pounds with semi-annualinterest payments at 12.63% in exchange for $27.2 million with semi-annualinterest payments at 11.25%. The British Pound Swap was designated as a cashflow hedge that effectively converted $27.2 million of the 11.25% Notesrecorded on the books of a U.K. subsidiary into a fixed-rate British Poundloan, which reduced the impact of foreign exchange rate changes on theprincipal and interest payments on the loan. On August 8, 2003, the Companyused the proceeds from the issuance of the 8.50% Notes to repay the portion ofthe 11.25% Notes that were hedged by the British Pound Swap. As a result ofthis repayment, the British Pound Swap became an ineffective hedge and no longerqualified for hedge accounting. The balance related to the British Pound Swapremaining in other comprehensive income at the time it became an ineffectivehedge was not significant. Changes in fair market value on the British PoundSwap subsequent to it becoming an ineffective hedge are recognized in currentearnings during the period of change. During the seven months ended December26, 2003, the loss recognized in other expense, net of taxes, related to theineffectiveness of the British Pound Swap was $2.3 million. During the fivemonths ended May 23, 2003 and the seven months ended December 26, 2003, priorto becoming ineffective, the Company reclassified a net (loss) gain of $(0.4)million and $0.3 million, respectively, from other comprehensive income intoearnings in order to offset the gain recognized related to the remeasurement ofthe foreign-currency denominated loan. As of December 26, 2003, the Company hadrecorded a liability for the fair value of the British Pound Swap, as estimatedby a third party, of $7.1 million.

 

Effective December 30, 2000, the Company adopted SFAS No. 133 whichresulted in the Company recording transition adjustments to recognize itsderivative instruments at fair value. The cumulative effect of these transitionadjustments was an after-tax increase in other comprehensive loss ofapproximately $2.0 million.

 

49

----

 

The following table summarizes activity in other comprehensive income(“OCI”) related to derivatives held by the Company:

 
|                                                                  |   | **Before-Tax  Gains (Losses)** |   | **Income  Tax** |   | **After-Tax  Gains (Losses)** |   |
|-----------------------------------------------------------------------|--------|--------------------------------|--------|-----------------|--------|-------------------------------|--------|
| **Predecessor year ended December 28, 2001**                          |   |                           |   |            |   |                          |   |
| Cumulative  effect of adopting SFAS 133                               |   | $                              | (3,204 | )               | $      | 1,190                         |   | $ | (2,014 | ) |
| Net changes in  fair value of derivatives                             |   | 1,798                          |   | (541            | )      | 1,257                         |   |
| Net losses  reclassified from OCI into earnings                       |   | 745                            |   | (353            | )      | 392                           |   |
| Accumulated  derivative net (losses) at December 28, 2001             |   | (661                           | )      | 296             |   | (365                          | )      |
| **Predecessor  year ended December 27, 2002**                         |   |                           |   |            |   |                          |   |
| Net changes in  fair value of derivatives                             |   | (3,582                         | )      | 1,145           |   | (2,437                        | )      |
| Net losses  reclassified from OCI into earnings                       |   | 3,253                          |   | (1,046          | )      | 2,207                         |   |
| Accumulated  derivative net (losses) at December 27, 2002             |   | (990                           | )      | 395             |   | (595                          | )      |
| **Predecessor  five months ended May 23, 2003**                       |   |                           |   |            |   |                          |   |
| Net changes in  fair value of derivatives                             |   | (455                           | )      | 131             |   | (324                          | )      |
| Net losses  reclassified from OCI into earnings                       |   | 645                            |   | (221            | )      | 424                           |   |
| Accumulated  derivative net (losses) at May 23, 2003                  |   | (800                           | )      | 305             |   | (495                          | )      |
| **Successor  seven months ended December 26, 2003**                   |   |                           |   |            |   |                          |   |
| Purchase  accounting adjustment related to the 2003 Stock Transaction |   | 800                            |   | (305            | )      | 495                           |   |
| Net changes in  fair value of derivatives                             |   | 748                            |   | (241            | )      | 507                           |   |
| Net gains  reclassified from OCI into earnings                        |   | (624                           | )      | 192             |   | (432                          | )      |
| Accumulated  derivative net gains at December 26, 2003                |   | $                              | 124    |            | $      | (49                           | )      | $ | 75 |   |

 

The Company would beexposed to credit-related losses in the event of nonperformance by thecounterparties that issued the currency agreements. The Company does not expectthat counterparties to the currency agreements will fail to meet their obligations,given their high credit ratings. The Company generally does not requirecollateral on derivative instruments due to the credit rating of itscounterparties; however, the Company provides collateral when required by itscounterparties.

 

The fair value of the Company’s long-term debt is estimated based onthe current rates offered to the Company for debt of similar terms except forthe 8.50% Notes, which are measured at the quoted market rate. The fair valueof the 8.50% Notes was $213.0 million at December 26, 2003.  The fair value of other long-term debtapproximates their carrying value at December 26, 2003.

 

The Company’s financial instruments that are exposed to concentrationsof credit risk consist primarily of cash and cash equivalents and tradeaccounts receivable. The fair value of these financial instruments approximatesbook value at December 26, 2003 and December 27, 2002. The Company places itscash****andcash equivalents with high credit quality institutions. At times, suchinvestments may be in excess of the Federal Deposit Insurance Corporationinsurance limit; however, the Company believes that its credit risk exposure isnot significant due to the high credit quality of the institutions. The Companyroutinely assesses the financial strength of its customers, and generally doesnot require collateral. Also, due to the large number of customers and thewidely dispersed geographic areas in which the Company’s businesses operate,the Company believes that its trade accounts receivable credit risk exposure isnot significant; however, the Company does provide for doubtful accounts basedon historical experience and when current market conditions indicate thatcollection of an amount is doubtful.

 

50

----

 

**9.  Capital Structure:**

 

**Common Stock**

 

The Company hasauthorized 1,200,000 shares consisting of 600,000 shares of Class A votingcommon stock, par value of one dollar ($1.00) per share, and 600,000 shares ofClass B convertible restricted voting common stock, par value of one dollar($1.00) per share. As of December 26, 2003, the Company had 500,019.91 issuedand 492,495.79 outstanding shares of common stock with a par value of onedollar ($1.00) per share. Except with respect to voting rights, all shares ofClass A and Class B convertible common stock are identical in all respects andentitle the holders thereof to the same rights, preferences and privileges, andare subject to the same qualifications, limitations and restrictions, all asdescribed in the Company’s Certificate of Incorporation. The senior securedcredit facility contains certain restrictions on the payment of cash dividends.

 

The holders of Class Acommon stock are entitled to one vote per share on all matters voted on by theCompany’s stockholders, and the holders of Class B convertible common stock aregenerally entitled to one vote per ten (10) shares held on any matters to bevoted on the by the Company’s stockholders, with exceptions as noted in theCompany’s Certificate of Incorporation. In addition, each share of Class Bconvertible common stock may be converted at any time into one share of Class Acommon stock at the option of the holder.

 

In connection with the 2003 Stock Transaction, the Company converted44,346.8 shares of Class B common stock into Class A common stock.Additionally, the Company issued 883.75 shares of Class A common stock to CVCEPand issued 9,569.6 shares of restricted Class A common stock to management fromshares held in treasury.

 

**StockPlans**

 

OnJune 12, 2003, the Company established an equity compensation program, theEuramax International, Inc. 2003 Equity Compensation Plan, or 2003 Equity Plan,for the purpose of attracting and retaining valued employees. The 2003 EquityPlan was approved by the Board of Directors and was not subject to shareholderapproval. Under the 2003 Equity Plan, the Company has granted restricted sharesof Class A common stock and granted options to purchase shares of EuramaxInternational Class A common stock to selected officers and other keyemployees. The Company has reserved 35,719.6 shares of Class A common stock forissuance under the 2003 Equity Plan.

 

The2003 Equity Plan is administered by a committee designated by the Board ofDirectors. The committee has full authority to act in selecting the eligibleemployees to whom awards of options or restricted stock may be granted. Thecommittee determines the times at which such awards of restricted stock oroptions may be granted, the terms and conditions of awards that may be grantedunder the 2003 Equity Plan and the terms of agreements which will be enteredinto with employees designated to participate in the 2003 Equity Plan. However,in no event may the exercise price of any non-qualified options granted underthe 2003 Equity Plan be less than the fair market value of the underlyingshares on the date of grant.

 

The2003 Equity Plan permits the committee to grant both incentive stock optionsand non-qualified stock options, with all options granted in connection withthe 2003 Stock Transaction being non-qualified stock options. The committee maydetermine the number of options granted to each participant, the exercise priceof each option, the duration of options (not to exceed 10 years), vestingprovisions and all other terms and conditions of such options in individualoption agreements. The non-qualified stock option grant agreements in effect onthe date hereof provide that each participant will vest in 20% of the sharessubject to the option grant on each anniversary of the date of grant, untilbecoming 100% vested after 5 years. Non-qualified stock option grant agreementsunder the 2003 Equity Plan provide that upon termination of employment with theCompany, the exercise period for vested options will generally be limited,except that vested options will be canceled immediately upon a termination forcause. The non-qualified stock option grant agreements provide for thecancellation of all unvested options upon termination of employment with theCompany. Under the 2003 Equity Plan, if any option shares subject to anoutstanding option grant are forfeited or if the option grant otherwiseterminates without exercise, any of these forfeited or terminated option grantshares may be reissued at the discretion of the committee. In connection withthe 2003 Stock Transaction the Company issued 25,750

 

51

----

 

optionsto purchase shares of Class A common stock with an exercise price of $400.00per share, which approximated fair value. As of December 26, 2003, no optionsare exercisable.

 

Informationwith respect to option activity under the 2003 Equity Plan is set forth below:

 
|                            |   | **Options  Outstanding** | ** ** | **Weighted  Average  Exercise  Price** | ** ** |
|---------------------------------|--------|--------------------------|------------|----------------------------------------|------------|
|                            |   |                     |       |                                   |       |
| **Balance,  December 27, 2002** |   | —                   |       | $                                      | —     |   |
| Options granted                 |   | 25,750                   |       | 400.00                                 |       |
| Options  exercised              |   | —                   |       | —                                 |       |
| Options  forfeited              |   | —                   |       | —                                 |       |
| Options expired                 |   | —                   |       | —                                 |       |
| **Balance,  December 26, 2003** |   | 25,750                   |       | $                                      | 400.00     |   |

 

The2003 Equity Plan also permits the Company to grant participants restrictedshares of Class A common stock. The committee will determine the number ofshares of restricted stock granted to each participant, the period therestricted stock is unvested and subject to forfeiture and all other terms andconditions applicable to such restricted stock in individual restricted stockagreements. The restricted stock agreements in effect on the date hereofprovide that the participant will vest in 100% of the restricted shares fiveyears from the date of grant. If an employee voluntarily terminates his or heremployment, the employee will forfeit any unvested shares of restricted stock.If employment is terminated for any reason other than voluntary termination,all unvested shares of the restricted stock shall be accelerated as of the dateof non-voluntary termination. All shares of restricted stock granted, and allshares acquired upon exercise of options granted, under the 2003 Equity Planwill be subject to the stockholders agreement described in Note 16. Inconnection with the 2003 Stock Transaction, the Company granted 9,569.6 sharesof restricted Class A common stock with a fair value of $400.00 per share.  The restricted stock grants were recorded asa contra equity account at issuance and are being amortized into earnings overthe period that they vest. Total compensation expense recognized for the sevenmonths ended December 26, 2003 was $0.4 million.

 

The2003 Equity Plan provides that upon a change in control of the Company, allrestricted stock awards shall become fully vested, and each unexercised andoutstanding option shall become immediately and fully vested and exercisable.All restricted stock awards shall also become fully vested in the event of aninitial public offering of the Company’s common stock. Each option that isexercisable immediately prior to the change in control may be canceled inexchange for a payment in cash of an amount equal to the excess of the fairmarket value of the common stock underlying the option as of the date of thechange in control over the exercise price. The committee may also decide thatsuch options be terminated immediately prior to the change in control, providedthat the participant fails to exercise the option within a specified period (ofat least seven days) following receipt of written notice of the change incontrol and of the Company’s intention to terminate the option prior to suchchange in control. Alternatively, the committee may determine that in the eventof a change in control, such options shall be assumed by the successorcorporation, and shall be substituted with options involving the common stockof the successor corporation with equivalent value and with the terms andconditions of the substituted options being no less favorable than the optionsgranted by the Company.

 

**10.  Income Taxes:**

 

The provisions for income taxes are comprised of the following:

 

52

----

 
|         |   | **Predecessor**                        |   | **Successor**                                |       | **Predecessor**                    |       |
|--------------|--------|----------------------------------------|--------|----------------------------------------------|------------|------------------------------------|------------|
|         |   | **Five  months  ended  May 23,  2003** |   | **Seven  months  ended  December 26,  2003** | ** ** | **Year ended  December 27,  2002** | ** ** | **Year ended  December 28,  2001** | ** ** |
| Current:     |   |                                   |   |                                         |       |                               |       |   |   |
| U.S. Federal |   | $                                      | 1,205  |                                         | $          | 1,635                              |       | $ | 2,158 |   | $ | 1,124 |   |
| Non-U.S.     |   | 1,143                                  |   | 6,130                                        |       | 4,246                              |       | 4,011 |   |
| State        |   | (256                                   | )      | 421                                          |       | 754                                |       | 357 |   |
|         |   | $                                      | 2,092  |                                         | $          | 8,186                              |       | $ | 7,158 |   | $ | 5,492 |   |
|         |   |                                   |   |                                         |       |                               |       |   |   |
| Deferred:    |   |                                   |   |                                         |       |                               |       |   |   |
| U.S. Federal |   | $                                      | 58     |                                         | $          | 2,268                              |       | $ | 4,642 |   | $ | 354 |   |
| Non-U.S.     |   | 2,029                                  |   | (3,259                                       | )          | (329                               | )          | (75 | ) |
| State        |   | 75                                     |   | (87                                          | )          | (39                                | )          | (250 | ) |
|         |   | $                                      | 2,162  |                                         | $          | (1,078                             | )          | $ | 4,274 |   | $ | 29 |   |
|         |   |                                   |   |                                         |       |                               |       |   |   |
|         |   | $                                      | 4,254  |                                         | $          | 7,108                              |       | $ | 11,432 |   | $ | 5,521 |   |

 

The U.S. and non-U.S. components of earnings (loss) before income taxesare as follows:

 
|     |   | **Predecessor**                        |   | **Successor**                                |       | **Predecessor**                    |       |
|----------|--------|----------------------------------------|--------|----------------------------------------------|------------|------------------------------------|------------|
|     |   | **Five  months  ended  May 23,  2003** |   | **Seven  months  ended  December 26,  2003** | ** ** | **Year ended  December 27,  2002** | ** ** | **Year ended  December 28,  2001** | ** ** |
|     |   |                                   |   |                                         |       |                               |       |   |   |
| U.S.     |   | $                                      | 1,784  |                                         | $          | 12,667                             |       | $ | 19,734 |   | $ | 2,064 |   |
| Non-U.S. |   | 9,362                                  |   | 9,197                                        |       | 11,555                             |       | 8,187 |   |
|     |   | $                                      | 11,146 |                                         | $          | 21,864                             |       | $ | 31,289 |   | $ | 10,251 |   |

 

Reconciliation of the differences between income taxes computed at theU.S. Federal statutory tax rate and the Company’s income tax provision follows:

 

53

----

 
|                                                                   |   | **Predecessor**                        |   | **Successor**                                |       | **Predecessor**                    |       |
|------------------------------------------------------------------------|--------|----------------------------------------|--------|----------------------------------------------|------------|------------------------------------|------------|
|                                                                   |   | **Five  months  ended  May 23,  2003** |   | **Seven  months  ended  December 26,  2003** | ** ** | **Year ended  December 27,  2002** | ** ** | **Year ended  December 28,  2001** | ** ** |
|                                                                   |   |                                   |   |                                         |       |                               |       |   |   |
| Tax at U.S.  Federal statutory rate                                    |   | $                                      | 3,901  |                                         | $          | 7,653                              |       | $ | 10,952 |   | $ | 3,588 |   |
| State income  taxes, net of U.S. Federal income tax benefit            |   | 155                                    |   | 222                                          |       | 481                                |       | 102 |   |
| Impact of  non-U.S. tax rates, net                                     |   | (143                                   | )      | 43                                           |       | (65                                | )          | 150 |   |
| Permanent  differences (primarily goodwill amortization prior to 2002) |   | 101                                    |   | 63                                           |       | 233                                |       | 1,113 |   |
| Valuation  allowances for state taxes                                  |   | —                                 |   | (556                                         | )          | —                             |       | — |   |
| Other, net                                                             |   | 240                                    |   | (317                                         | )          | (169                               | )          | 568 |   |
|                                                                   |   | $                                      | 4,254  |                                         | $          | 7,108                              |       | $ | 11,432 |   | $ | 5,521 |   |

 

At December 26, 2003 and December 27, 2002, the combined tax-effectedtemporary differences are as follows:

 
|                           |   | **Asset  (Liability)**            |    |
|--------------------------------|--------|-----------------------------------|---------|
|                           |   | **Successor  December 26,  2003** |    | **Predecessor  December 27,  2002** | ** ** |
|                           |   |                              |    |   |   |
| Accrued expenses               |   | $                                 | 5,024   |   | $ | 2,075 |   |
| Accounts  Receivable           |   | 373                               |    | 481 |   |
| Inventories                    |   | (15                               | )       | 343 |   |
| Current, net                   |   | 5,382                             |    | 2,899 |   |
|                           |   |                              |    |   |   |
| Property, plant  and equipment |   | (23,486                           | )       | (17,120 | ) |
| Net operating  losses          |   | 2,039                             |    | 5,047 |   |
| Other  liabilities             |   | 2,587                             |    | 3,011 |   |
| Valuation  allowance           |   | (1,889                            | )       | (2,744 | ) |
| Other                          |   | (4,938                            | )       | (2,640 | ) |
| Noncurrent, net                |   | (25,687                           | )       | (14,446 | ) |
| Total, net                     |   | $                                 | (20,305 | ) | $ | (11,547 | ) |

 

Deferred taxes have not been provided on undistributed earnings offoreign subsidiaries, which are considered to be permanently invested. It isnot practicable to estimate the amount of tax that might be payable on theeventual remittance of such earnings. In addition, an acquired subsidiary,Berger Holdings, Ltd., has state NOL carryforwards of approximately $5.1million that are available to offset future taxable income and taxes. The statetax carryforward benefits begin to expire in 2024. In addition, the Company hasstate NOL carryforwards and capital loss carryforwards, substantially all ofwhich are reserved with a valuation allowance. The Company’s valuationallowance was $1.9 million, $2.7 million and $2.5 million as of December 26,2003, December 27, 2002 and December 28, 2001, respectively, of which $1.0million, if subsequently recognized, will be allocated to reduce goodwill.

 

**11.Comprehensive Income:**

 

Accumulated other comprehensive income (loss) balances were as follows:

 

54

----

 
|                                                |   | **Successor  December 26,  2003** |   | **Predecessor  December 27,  2002** |   |
|-----------------------------------------------------|--------|-----------------------------------|--------|-------------------------------------|--------|
|                                                |   |                              |   |                                |   |
| Foreign currency  translation adjustment            |   | $                                 | 4,552  |                                | $      | (1,132 | ) |
| Accumulated  derivative net gain (loss), net of tax |   | 75                                |   | (595                                | )      |
| Minimum pension  liability, net of tax              |   | (83                               | )      | (8,157                              | )      |
|                                                |   |                              |   |                                |   |
|                                                |   | $                                 | 4,544  |                                | $      | (9,884 | ) |

 

There were no tax effects related to the foreign currency translationadjustment component of other comprehensive loss for any year presented becausethe earnings of the subsidiaries are considered to be permanently invested. Thetax effects related to the minimum pension liability component of othercomprehensive income (loss) were not significant as of December 26, 2003, $4.0million as of December 27, 2002 and $3.1 million as of December 28, 2001. Thetax effects related to accumulated derivative net losses are disclosed in Note8.

 

**12.  Employee Retirement Plans:**

 

The Company maintains a variety of retirement plans as follows:

 

*U.S.Plans:*

 

*DefinedBenefit:*

 

The Company maintains a non-contributory defined benefit pension plancovering substantially all U.S. hourly employees.  The plan has a measurement date of January 1, 2003.

 

55

----

 

The following table sets forth the reconciliations of the projectedbenefit obligation and plan assets, the funded status of the plan and theamounts recognized in the Company’s consolidated balance sheets:

 
|                                                       |   | **Year ended  December 26,  2003** |   | **Year ended  December 27,  2002** | ** ** |
|------------------------------------------------------------|--------|------------------------------------|--------|------------------------------------|------------|
|                                                       |   |                               |   |                               |       |
| **Change  in benefit obligation**                          |   |                               |   |                               |       |
| Projected  benefit obligation at beginning of year         |   | $                                  | 2,678  |                               | $          | 2,142 |   |
| Service cost                                               |   | 344                                |   | 300                                |       |
| Interest cost                                              |   | 183                                |   | 152                                |       |
| Plan amendments                                            |   | 18                                 |   | —                             |       |
| Actuarial loss                                             |   | 338                                |   | 203                                |       |
| Benefits paid                                              |   | (75                                | )      | (119                               | )          |
| Projected  benefit obligation at end of year               |   | $                                  | 3,486  |                               | $          | 2,678 |   |
| Accumulated  benefit obligation                            |   | $                                  | 3,486  |                               | $          | 2,678 |   |
|                                                       |   |                               |   |                               |       |
| **Change  in plan assets**                                 |   |                               |   |                               |       |
| Fair value of  plan assets at beginning of year            |   | $                                  | 2,223  |                               | $          | 1,844 |   |
| Actual gain  (loss) on plan assets                         |   | 416                                |   | (206                               | )          |
| Employer  contributions                                    |   | 249                                |   | 704                                |       |
| Benefits paid                                              |   | (75                                | )      | (119                               | )          |
| Fair value of  plan assets at end of year                  |   | $                                  | 2,813  |                               | $          | 2,223 |   |
|                                                       |   |                               |   |                               |       |
| **Funded  status**                                         |   | $                                  | (673   | )                                  | $          | (455 | ) |
| Unrecognized  actuarial loss                               |   | 74                                 |   | 1,115                              |       |
| Unrecognized  prior service cost                           |   | 7                                  |   | 214                                |       |
| Net amount  recognized                                     |   | $                                  | (592   | )                                  | $          | 874 |   |
|                                                       |   |                               |   |                               |       |
| **Amounts  recognized in the consolidated balance sheets** |   |                               |   |                               |       |
| Other  liabilities                                         |   | $                                  | (673   | )                                  | $          | (455 | ) |
| Intangible asset                                           |   | 7                                  |   | 214                                |       |
| Accumulated  other comprehensive loss                      |   | 74                                 |   | 1,115                              |       |
| Net amount  recognized in balance sheet                    |   | $                                  | (592   | )                                  | $          | 874 |   |

 

As a result of the application of the purchase method of accountingresulting from the 2003 Stock Transaction and subsequent issuance of seniorsubordinated notes, the unrecognized actuarial loss on the plan at the time ofthe 2003 Stock Transaction was reclassified from accumulated othercomprehensive loss to additional paid-in capital.  The Company expects to contribute approximately $0.9 million toits U.S. plan during fiscal 2004.

 

56

----

 

Weighted average assumptions used in computing the benefit obligationsare as follows:

 
|                                              |   | **Successor  December 26,  2003** |   | **Predecessor  December 27,  2002** |   |
|---------------------------------------------------|--------|-----------------------------------|--------|-------------------------------------|--------|
| **Weighted-average  assumptions**                 |   |                              |   |                                |   |
| Discount rate                                     |   | 6.25                              | %      | 6.75                                | %      |
| Expected  long-term rate of return on plan assets |   | 8.00                              | %      | 8.00                                | %      |

 

Weighted average assumptions used in computing net periodic pensioncost are as follows:

 
|                                              |   | **Predecessor**                        |   | **Successor**                                |   | **Predecessor**                    |   |
|---------------------------------------------------|--------|----------------------------------------|--------|----------------------------------------------|--------|------------------------------------|--------|
|                                              |   | **Five  months  ended  May 23,  2003** |   | **Seven  months  ended  December 26,  2003** |   | **Year ended  December 27,  2002** |   | **Year ended  December 28,  2001** |   |
| **Weighted-average  assumptions**                 |   |                                   |   |                                         |   |                               |   |   |   |
| Discount rate                                     |   | 6.75                                   | %      | 6.75                                         | %      | 7.25                               | %      | 7.75 | % |
| Expected  long-term rate of return on plan assets |   | 8.00                                   | %      | 8.00                                         | %      | 8.00                               | %      | 8.00 | % |

 

Net periodic pension costs for the plan include the followingcomponents:

 
|                                         |   | **Predecessor**                        |   | **Successor**                                |       | **Predecessor**                    |       |
|----------------------------------------------|--------|----------------------------------------|--------|----------------------------------------------|------------|------------------------------------|------------|
|                                         |   | **Five  months  ended  May 23,  2003** |   | **Seven  months  ended  December 26,  2003** | ** ** | **Year ended  December 27,  2002** | ** ** | **Year ended  December 28,  2001** | ** ** |
| **Components  of net periodic pension cost** |   |                                   |   |                                         |       |                               |       |   |   |
| Service cost                                 |   | $                                      | 143    |                                         | $          | 201                                |       | $ | 300 |   | $ | 267 |   |
| Interest cost                                |   | 76                                     |   | 107                                          |       | 152                                |       | 130 |   |
| Expected return  on assets                   |   | (77                                    | )      | (109                                         | )          | (174                               | )          | (138 | ) |
| Amortization of  prior service cost          |   | 10                                     |   | 1                                            |       | 21                                 |       | 21 |   |
| Recognized  actuarial net loss               |   | 34                                     |   | —                                       |       | 29                                 |       | — |   |
| Net periodic  pension cost                   |   | $                                      | 186    |                                         | $          | 200                                |       | $ | 328 |   | $ | 280 |   |

 

The following table sets forth the actual asset allocation for the planas of December 26, 2003 and December 27, 2002, and the target asset allocationfor the plan:

 
|                       |   | **Successor  December 26,  2003** |   | **Predecessor  December 27,  2002** |   | **Target** |   |
|----------------------------|--------|-----------------------------------|--------|-------------------------------------|--------|------------|--------|
|                       |   |                              |   |                                |   |       |   |
| Equity  securities         |   | 63.7                              | %      | 60.1                                | %      | 60.00      | %      |
| Debt securities            |   | 35.2                              | %      | 39.5                                | %      | 37.00      | %      |
| Cash and cash  equivalents |   | 1.1                               | %      | 0.4                                 | %      | 3.00       | %      |

 

To develop the expected long-term rate of return on assets assumption,the Company considered the historical returns and the future expectations forreturns for each asset class, as well as the target asset allocation of thepension portfolio.

 

The investment strategy of the plan is to ensure, over the long-termlife of the plan, an adequate pool of assets along with contributions by theCompany to support the benefit obligations to participants, retirees andbeneficiaries. The Company desires to achieve market returns consistent with aprudent level of diversification. All investments are made solely in theinterest of the plan’s participants and beneficiaries for the exclusivepurposes of providing benefits to such participants and

 

57

----

 

their beneficiaries and defraying the expenses related to administeringthe plan. The target allocation of all assets is to reflect properdiversification in order to reduce the potential of a single security or singlesector of securities having a disproportionate impact on the portfolio. TheCompany utilizes an outside investment consultant and various publicly tradedmutual funds to implement its investment strategy. Investment performance ofplan assets is reviewed semi-annually and the investment objectives areevaluated over rolling four year time periods.

 

*DefinedContribution:*

 

The Company maintains three defined contribution retirement and savingsplans, which also allow the employees to contribute a percentage of theirpretax and/or after-tax income in accordance with specified guidelines. TheCompany matches a certain percentage of employee pre-tax contributions up tocertain limits. Further, the plans provide for discretionary contributions bythe Company based on years of service and age. The Company’s expense for thefive months ended May 23, 2003, the seven months ended December 26, 2003 andthe years ended December 27, 2002 and December 28, 2001, was approximately $0.7million, $1.0 million, $1.5 million, and $1.5 million, respectively.

 

*InternationalPlans:*

 

In addition to the above, the employees of Euramax Coated ProductsLimited and Ellbee Limited participate in a single employer pension plan (the“U.K. Plan”).

 

 

The following table sets forth the reconciliations of the projectedbenefit obligations and plan assets, the funded status of the U.K. Plan andamounts recognized in the Company’s consolidated balance sheets:

 

58

----

 
|                                                       |   | **Year ended  December 26,  2003** |    | **Year ended  December 27,  2002** |   |
|------------------------------------------------------------|--------|------------------------------------|---------|------------------------------------|--------|
|                                                       |   |                               |    |                               |   |
| **Change  in benefit obligation**                          |   |                               |    |                               |   |
| Projected  benefit obligation at beginning of year         |   | $                                  | 23,250  |                               | $      | 22,032 |   |
| Service cost                                               |   | 821                                |    | 736                                |   |
| Interest cost                                              |   | 1,458                              |    | 1,253                              |   |
| Employee  contributions                                    |   | 420                                |    | 318                                |   |
| Actuarial loss  (gain)                                     |   | 1,582                              |    | (2,624                             | )      |
| Benefits paid                                              |   | (836                               | )       | (626                               | )      |
| Currency  translation adjustment                           |   | 2,704                              |    | 2,161                              |   |
| Projected  benefit obligation at end of year               |   | $                                  | 29,399  |                               | $      | 23,250 |   |
| Accumulated  benefit obligation at end of year             |   | $                                  | 27,475  |                               | $      | 23,250 |   |
|                                                       |   |                               |    |                               |   |
| **Change  in plan assets**                                 |   |                               |    |                               |   |
| Fair value of  plan assets at beginning of year            |   | $                                  | 11,625  |                               | $      | 12,104 |   |
| Actual gain  (loss) on plan assets                         |   | 2,131                              |    | (2,881                             | )      |
| Employer  contributions                                    |   | 2,198                              |    | 1,453                              |   |
| Employee  contributions                                    |   | 420                                |    | 318                                |   |
| Benefits paid                                              |   | (836                               | )       | (626                               | )      |
| Currency translation  adjustment                           |   | 1,536                              |    | 1,257                              |   |
| Fair value of  plan assets at end of year                  |   | $                                  | 17,074  |                               | $      | 11,625 |   |
|                                                       |   |                               |    |                               |   |
| **Funded  status**                                         |   | $                                  | (12,325 | )                                  | $      | (11,625 | ) |
| Unrecognized  actuarial net loss                           |   | 420                                |    | 11,383                             |   |
| Net amount  recognized                                     |   | $                                  | (11,905 | )                                  | $      | (242 | ) |
|                                                       |   |                               |    |                               |   |
| **Amounts  recognized in the consolidated balance sheets** |   |                               |    |                               |   |
| Other  liabilities                                         |   | $                                  | (11,905 | )                                  | $      | (11,625 | ) |
| Accumulated  other comprehensive loss                      |   | —                             |    | 11,383                             |   |
| Net amount  recognized in balance sheet                    |   | $                                  | (11,905 | )                                  | $      | (242 | ) |

 

As a result of the application of the purchase method of accountingresulting from the 2003 Stock Transaction and subsequent issuance of seniorsubordinated notes, the unrecognized actuarial loss on the plan at the time ofthe 2003 Stock Transaction was reclassified from accumulated other comprehensiveloss to additional paid-in capital.

 

Weighted average assumptions used in the accounting for the U.K. planinclude:

 
|                                              |   | **Predecessor**                        |   | **Successor**                                |   | **Predecessor**                    |   |
|---------------------------------------------------|--------|----------------------------------------|--------|----------------------------------------------|--------|------------------------------------|--------|
|                                              |   | **Five  months  ended  May 23,  2003** |   | **Seven  months  ended  December 26,  2003** |   | **Year ended  December 27,  2002** |   | **Year ended  December 28,  2001** |   |
| **Weighted-average  assumptions**                 |   |                                   |   |                                         |   |                               |   |   |   |
| Discount rate                                     |   | 6.00                                   | %      | 6.00                                         | %      | 6.00                               | %      | 6.25 | % |
| Rate of  compensation increases                   |   | 4.00                                   | %      | 4.00                                         | %      | 3.75                               | %      | 4.00 | % |
| Expected  long-term rate of return on plan assets |   | 7.50                                   | %      | 7.50                                         | %      | 7.50                               | %      | 7.50 | % |

 

59

----

 

Net periodic pension cost for the U.K. Plan includes the followingcomponents:

 
|                                         |   | **Predecessor**                        |   | **Successor**                                |   | **Predecessor**                    |   |
|----------------------------------------------|--------|----------------------------------------|--------|----------------------------------------------|--------|------------------------------------|--------|
|                                         |   | **Five  months  ended  May 23,  2003** |   | **Seven  months  ended  December 26,  2003** |   | **Year ended  December 27,  2002** |   | **Year ended  December 28,  2001** |   |
| **Components  of net periodic pension cost** |   |                                   |   |                                         |   |                               |   |   |   |
| Service cost                                 |   | $                                      | 342    |                                         | $      | 479                                |   | $ | 736 |   | $ | 944 |   |
| Interest cost                                |   | 608                                    |   | 850                                          |   | 1,253                              |   | 1,006 |   |
| Expected return  on assets                   |   | (390                                   | )      | (546                                         | )      | (989                               | )      | (971 | ) |
| Recognized  actuarial net loss               |   | 274                                    |   | —                                       |   | 349                                |   | 201 |   |
| Net periodic  pension cost                   |   | $                                      | 834    |                                         | $      | 783                                |   | $ | 1,349 |   | $ | 1,180 |   |

 

*SupplementalExecutive Retirement Plan:*

 

The Company has twounfunded supplemental retirement plans for members of management. At December26, 2003 and December 27, 2002, the accrued liability for future benefits underthe plans was $1.7 million and $1.1 million, respectively. Benefits expense forthe plan totaled $0.2 million, $0.3 million and $0.1 million in 2003, 2002 and2001, respectively.

 

60

----

 

**13.  Incentive Plans:**

 

**IncentiveCompensation Plan**

 

The Company has anincentive compensation plan that covers key employees. The costs of the planare computed in accordance with a formula that incorporates EBITDA (as definedin the plan) and return on average net assets. Costs of the plan for fivemonths ended May 23, 2003, the seven months ended December 26, 2003 and yearsended December 27, 2002 and December 28, 2001, were approximately $1.0 million,$1.6 million, $3.7 million, and $2.8 million, respectively.

 

**Long-TermIncentive Plan**

 

In 1998, the Company established the Euramax International 1999 PhantomStock Plan, or the Phantom Stock Plan, which was effective January 1, 1999. Thepurpose of the Phantom Stock Plan was to link the interests of the participantsto those of the Company’s shareholders through compensation that is tied to theincrease in the equity value of the Company from January 1, 1999 to December31, 2003. Participation in the Phantom Stock Plan was limited to key executivesand certain other management employees as approved, from time to time, by aCommittee selected by the President.

 

The Plan provides forone-time awards of phantom shares to selected participants. A phantom share isa unit equal to 4% of the equity value of the Company, as defined by thePhantom Stock Plan, divided by 40,000 (the maximum number of phantom sharesthat may be awarded to participants under the Phantom Stock Plan). A phantomshare entitles the participant to receive compensation equal to the value of aphantom share on December 31, 2003, minus the value of a phantom share at thedate of grant, all as defined by the Phantom Stock Plan. On January 1, 1999,36,000 of the phantom shares were granted, of which 26,547 shares and 31,385shares remain outstanding as of December 26, 2003 and December 27, 2002,respectively. No additional grants of shares will be made under the Plan.Compensation expense accrues in the period from the date of grant to December31, 2003, adjusted for changes in the value of the phantom shares. Compensationexpense in connection with the Phantom Stock Plan for the five months ended May23, 2003, the seven months ended December 26, 2003, and the year ended December27, 2002 was $0.3 million, $2.7 million and $2.2 million, respectively.  No amounts were recorded during fiscal year2001 because the value of a phantom share as of December 28, 2001 was less thanthe value on the date of grant. The value of the awards became fixed onDecember 31, 2003. As of December 26, 2003, the Company had a liability of $5.2million under the Phantom Stock Plan. Compensation will be paid out in fourequal payments during the first quarter of 2004 through 2007, unless there is achange in control; a listing of the Company’s shares; or the death ordisability of the participant; in which case the compensation will be paid outimmediately. Participants that are not employees of the Company on the datecompensation is paid out will forefeit their compensation.

 

**14.  Commitments and Contingencies:**

 

Minimum commitments under long-term noncancelable operating leases,principally for operating and office facilities at December 26, 2003 were asfollows:

 
| 2004       |   | $     | 7,713  |   |
|------------|--------|-------|--------|--------|
| 2005       |   | 6,660 |   |
| 2006       |   | 4,338 |   |
| 2007       |   | 3,248 |   |
| 2008       |   | 2,013 |   |
| Thereafter |   | 3,010 |   |
|       |   | $     | 26,982 |   |

 

Rent expense amounted to $3.2 million, $5.3 million, $6.8 million and$5.5 million for the five months ended May 23, 2003, the seven months endedDecember 26, 2003, and the years ended December 27, 2002 and December 28, 2001,respectively.

 

**RawMaterial Commitments**

 

To assure continuity of supply, the Company negotiates contracts forminimum annual purchases of aluminum from several suppliers. Commitments forminimum annual purchases are typically at an agreed upon cost to convertaluminum ingot into coil. At December 26, 2003, the value of such minimumpurchase commitments was approximately $26.0 million. In addition, to ensure amargin on specific sales, the Company may commit to purchase aluminum ingot orcoil at a fixed market price for future delivery. At December 26, 2003, suchfixed price purchase commitments were approximately $32.1 million.  All of the Company’s aluminum purchasecommitments expire in 2004.

 

61

----

 

**Litigation**

 

The Company is subject to legal proceedings and claims that have arisenin the ordinary course of business. Although occasional adverse decisions orsettlements may occur, it is the opinion of the Company’s management, basedupon information available at this time, that the expected outcome of thesematters is not estimable individually or in the aggregate, but would notreasonably be expected to have a material adverse effect on the consolidatedfinancial position, results of operations or cash flows of the Company and itssubsidiaries taken as a whole.

 

**EnvironmentalMatters**

 

The Company’s operations are subject to federal, state, local andEuropean environmental laws and regulations concerning the management of pollutionand hazardous substances.

 

The Company has beennamed as a potentially responsible party in state and Federal administrativeand judicial proceedings seeking contribution for costs associated with theinvestigation, analysis, correction and remediation of environmental conditionsat various hazardous waste disposal sites. The Company continues to monitorthese actions and proceedings and to vigorously defend both its own interestsas well as the interests of its affiliates. The Company’s ultimate liability inconnection with present and future environmental claims will depend on manyfactors, including its volumetric share of the waste at a given site, theremedial action required, the total cost of remediation, and the financialviability and participation of the other entities that also sent waste to thesite. Once it becomes probable that the Company will incur costs in connectionwith remediation of a site and such costs can be reasonably estimated, theCompany establishes or adjusts its reserve for its projected share of thesecosts. Based upon current law and information known to the Company concerningthe size of the sites known to it, anticipated costs, their years of operationsand the number of other potentially responsible parties, management believesthat the Company’s potential share of the estimated aggregate liability for thecosts of remedial actions and related costs and expenses are not material. Inaddition, the Company establishes reserves for remedial measures required fromtime to time at its own facilities. Management believes that the reasonablyprobable outcomes of these matters will not be material. The Company’sreserves, expenditures and expenses for all environmental exposures were notsignificant for any of the dates or periods presented.

 

In connection with theacquisition of the Company from Alumax, the Company was indemnified by Alumaxfor substantially all of its costs, if any, related to specifically identifiedenvironmental matters arising prior to the closing date of the acquisitionduring the period of time it was owned directly or indirectly by Alumax. Suchindemnification includes costs that may ultimately be incurred to contribute tothe remediation of certain specified existing National Priorities List sitesfor which the Company had been named a potentially responsible party under thefederal Comprehensive Environmental Response, Compensation, and LiabilityInformation System as of the closing date of the acquisition, as well ascertain potential costs for sites listed on state hazardous cleanup lists. TheCompany does not believe that it has any significant probable liability forenvironmental claims. Further, the Company believes it to be unlikely that theCompany would be required to bear environmental costs in excess of its pro ratashare of such costs as a potentially responsible party at any site.

 

The facility that BergerBrothers Company (“Berger”) leases in Ivyland, Pennsylvania has contaminatedgroundwater as a result of the migration from an adjacent property which wasformerly the Naval Air Warfare Center, currently an NPL site under CERCLA.  The United States Navy is conducting aclean-up of the Naval Air Warfare Center NPL site under the EnvironmentalProtection Agency’s supervision.  Theowner/landlord of the Berger property obtained liability protection underPennsylvania’s Brownfield Law by demonstrating to the Commonwealth ofPennsylvania that the contamination is from an off-site source, and underPennsylvania law that protection benefits the tenant as well.  Moreover, under Berger’s lease, the landlordretained any liability for this contamination. Accordingly, although the facility leased by Berger is on an NPL site, theeffects of this contamination would not reasonably be expected to have a materialadverse effect on our consolidated financial position, results of operations orcash flows.

 

**Product Warranties**

 

The Company provides warranties on certain products.  The warranty periods differ depending on theproduct, but generally range from one year to limited lifetime warranties.  The company provides accruals for warrantiesbased on historical experience and expectations of future occurrence. A summaryof the changes in the product warranty accrual follows:

 
|                                                          |   | **Predecessor**                        |   | **Successor**                                |   | **Predecessor**                   |   |
|---------------------------------------------------------------|--------|----------------------------------------|--------|----------------------------------------------|--------|-----------------------------------|--------|
|                                                          |   | **Five  months  ended  May 23,  2003** |   | **Seven  months  ended  December 26,  2003** |   | **Year ended  December 27, 2002** |   | **Year ended  December 28, 2001** |   |
|                                                          |   |                                   |   |                                         |   |                              |   |   |   |
| Beginning  balance                                            |   | $                                      | 2,809  |                                         | $      | 3,394                             |   | $ | 2,389 |   | $ | 2,300 |   |
| Payments made or  service provided                            |   | (720                                   | )      | (2,497                                       | )      | (2,611                            | )      | (1,867 | ) |
| Warranty expense                                              |   | 1,119                                  |   | 2,963                                        |   | 2,764                             |   | 2,046 |   |
| Change related  to changes in foreign currency exchange rates |   | 186                                    |   | 133                                          |   | 267                               |   | (90 | ) |
|                                                          |   |                                   |   |                                         |   |                              |   |   |   |
| Ending balance                                                |   | $                                      | 3,394  |                                         | $      | 3,993                             |   | $ | 2,809 |   | $ | 2,389 |   |

 

**15.  Segment Information:**

 

62

----

 

The Company’s acquisition of Berger Holdings, Ltd. on November 25, 2003led to an assessment of operating segments that resulted in the Company’sidentification of the U.S. Fabrication Roof Drainage operating segment. Thebusiness activities included in the U.S. Fabrication Roof Drainage operatingsegment were previously included in the U.S. Fabrication segment. Accordingly,segment information has been revised to conform to the Company’s revisedsegments. Our reportable segments are as follows:

 

*EuropeanRoll Coating* – The European Roll Coating facilities primarilyroll coat aluminum and steel sheet and coil for RV manufacturers,transportation manufacturers and building panel manufacturers.

 

*U.S.Fabrication Roof Drainage* – The U.S. Fabrication RoofDrainage facilities primarily fabricate coated aluminum and steel coil toproduce gutters, downspouts, soffit, fascia, gutter accessories and otherproducts. Such products are primarily sold to home centers, distributors andhome improvement contractors.

 

*U.S.Fabrication Building Materials* – The U.S. Building Materialsfacilities primarily fabricate coated aluminum and steel coil to produceroofing and siding panels, doors, windows, vehicle sidewalls and otherproducts. Such products are primarily sold to RV manufacturers, ruralcontractors, home improvement contractors, industrial and architecturalcontractors and manufactured housing producers.

 

*EuropeanFabrication –*The European Fabrication facilities primarilyfabricate aluminum extrusions and glass to produce windows, doors, showerenclosures, sunroofs and other products. Such products are primarily sold totransporation manufacturers, distributors, home centers and industrial andarchitectural contactors.

 

Theaccounting policies of the segments are the same as those described in Note 2,“Summary of Significant Accounting Policies.” Segment data includesintersegment revenues. The Company evaluates the performance of its segmentsand allocates resources to them based primarily on EBITDA.

 

The Company is organized primarily on the basisof seven operating segments. Certain operating segments with similareconomic characteristics have been aggregated according to similarity ofproducts, nature of production processes, types of customers and productdistribution methods. Two Europeansubsidiaries have been aggregated into the European Roll Coating segment, twoU.S. subsidiaries have been aggregated into the U.S. Fabrication BuildingMaterials segment and two European subsidiaries have been aggregated into theEuropean Fabrication segment. The U.S. Fabrication Roof Drainage operatingsegment is reported separately. The table below presents information aboutreported segments for the five months ended May 23, 2003, the seven monthsended December 26, 2003, and the years ended December 27, 2002 and December 28,2001. Expenses and assets that are not segment specific relate to holdingcompany and business development activities conducted for the overall benefitof the Company and, accordingly, are not attributable to the Company’ssegments.

 

63

----

 
|                                           |   | **Predecessor**                        |    | **Successor**                                |   | **Predecessor**                    |   |
|------------------------------------------------|--------|----------------------------------------|---------|----------------------------------------------|--------|------------------------------------|--------|
|                                           |   | **Five  months  ended  May 23,  2003** |    | **Seven  months  ended  December 26,  2003** |   | **Year ended  December 27,  2002** |   | **Year ended  December 28,  2001** |   |
|                                           |   |                                   |    |                                         |   |                               |   |   |   |
| **Sales**                                      |   |                                   |    |                                         |   |                               |   |   |   |
| European Roll  Coating                         |   | $                                      | 60,719  |                                         | $      | 97,729                             |   | $ | 131,154 |   | $ | 129,824 |   |
| U.S. Fabrication  Roof Drainage                |   | 54,415                                 |    | 126,904                                      |   | 152,678                            |   | 145,176 |   |
| U.S. Fabrication  Building Materials           |   | 107,617                                |    | 200,571                                      |   | 291,068                            |   | 263,736 |   |
| European  Fabrication                          |   | 39,913                                 |    | 61,708                                       |   | 69,705                             |   | 58,891 |   |
| Total segment  sales                           |   | 262,664                                |    | 486,912                                      |   | 644,605                            |   | 597,627 |   |
|                                           |   |                                   |    |                                         |   |                               |   |   |   |
| Eliminations                                   |   | (2,049                                 | )       | (3,224                                       | )      | (5,456                             | )      | (4,510 | ) |
| Consolidated net  sales                        |   | $                                      | 260,615 |                                         | $      | 483,688                            |   | $ | 639,149 |   | $ | 593,117 |   |
|                                           |   |                                   |    |                                         |   |                               |   |   |   |
| **EBITDA**                                     |   |                                   |    |                                         |   |                               |   |   |   |
| European Roll  Coating                         |   | $                                      | 9,508   |                                         | $      | 12,688                             |   | $ | 15,639 |   | $ | 14,649 |   |
| U.S. Fabrication  Roof Drainage                |   | 5,901                                  |    | 18,769                                       |   | 21,557                             |   | 20,157 |   |
| U.S. Fabrication  Building Materials           |   | 5,860                                  |    | 11,797                                       |   | 24,291                             |   | 14,542 |   |
| European  Fabrication                          |   | 4,489                                  |    | 6,280                                        |   | 7,815                              |   | 7,195 |   |
| Total EBITDA for  reportable segments          |   | 25,758                                 |    | 49,534                                       |   | 69,302                             |   | 56,543 |   |
|                                           |   |                                   |    |                                         |   |                               |   |   |   |
| Expenses that  are not segment specific        |   | 790                                    |    | (4,372                                       | )      | (1,297                             | )      | (3,479 | ) |
| Depreciation and  amortization                 |   | (6,276                                 | )       | (10,639                                      | )      | (13,968                            | )      | (17,555 | ) |
| Interest  expense, net                         |   | (9,126                                 | )       | (12,659                                      | )      | (22,748                            | )      | (25,258 | ) |
| Consolidated net  earnings before income taxes |   | $                                      | 11,146  |                                         | $      | 21,864                             |   | $ | 31,289 |   | $ | 10,251 |   |

 
|                                  |   | **Successor  December 26,  2003** |    | **Predecessor  December 27,  2002** |   |
|---------------------------------------|--------|-----------------------------------|---------|-------------------------------------|--------|
| **ASSETS**                            |   |                              |    |                                |   |
| European Roll  Coating                |   | $                                 | 153,921 |                                | $      | 107,185 |   |
| U.S. Fabrication  Roof Drainage       |   | 163,870                           |    | 105,121                             |   |
| U.S. Fabrication  Building Materials  |   | 153,513                           |    | 129,847                             |   |
| European  Fabrication                 |   | 96,107                            |    | 64,258                              |   |
| Assets that are not  segment specific |   | 41,418                            |    | 10,029                              |   |
|                                  |   |                              |    |                                |   |
| Total assets                          |   | $                                 | 608,829 |                                | $      | 416,440 |   |

 

64

----

 

Thefollowing table reflects revenues from external customers by markets for theperiods indicated. Revenues from external customers by groups of similarproducts have not been provided as it is impracticable for the Company to doso.

 
|                                                |   |                                                                                                                                                          |   | **Predecessor**                          |    | **Successor**                                  |   | **Predecessor**                    |   |
|-----------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------|---------|------------------------------------------------|--------|------------------------------------|--------|
| **Customers/Markets**                               |   | **Primary  Products**                                                                                                                                         |   | **Five  months****ended  May 23,  2003** |    | **Seven  months****ended  December 26,  2003** |   | **Year ended  December 27,  2002** |   | **Year ended  December 28,  2001** |   |
|                                                |   |                                                                                                                                                          |   |                                     |    |                                           |   |                               |   |   |   |
| Original Equipment Manufacturers (“OEMs”) |   | Painted aluminum sheet and coil; fabricated  painted aluminum, laminated and fiberglass panels; RV doors, windows and roofing;  and composite building panels |   | $                                        | 120,289 |                                           | $      | 186,132                            |   | $ | 264,447 |   | $ | 241,314 |   |
|                                                |   |                                                                                                                                                          |   |                                     |    |                                           |   |                               |   |   |   |
| Rural Contractors                                   |   | Steel and aluminum roofing and siding                                                                                                                         |   | 38,980                                   |    | 85,880                                         |   | 130,758                            |   | 120,082 |   |
|                                                |   |                                                                                                                                                          |   |                                     |    |                                           |   |                               |   |   |   |
| Home Centers                                        |   | Raincarrying systems, roofing accessories,  windows, doors and shower enclosures                                                                              |   | 51,129                                   |    | 110,997                                        |   | 129,943                            |   | 130,539 |   |
|                                                |   |                                                                                                                                                          |   |                                     |    |                                           |   |                               |   |   |   |
| Manufactured Housing                                |   | Steel siding and trim components                                                                                                                              |   | 8,031                                    |    | 13,189                                         |   | 19,373                             |   | 24,359 |   |
|                                                |   |                                                                                                                                                          |   |                                     |    |                                           |   |                               |   |   |   |
| Distributors                                        |   | Metal coils, raincarrying systems and  roofing accessories                                                                                                    |   | 12,084                                   |    | 29,880                                         |   | 25,611                             |   | 14,215 |   |
|                                                |   |                                                                                                                                                          |   |                                     |    |                                           |   |                               |   |   |   |
| Industrial and Architectural Contractors            |   | Standing seam panels and siding and roofing  accessories                                                                                                      |   | 9,183                                    |    | 17,362                                         |   | 17,063                             |   | 17,928 |   |
|                                                |   |                                                                                                                                                          |   |                                     |    |                                           |   |                               |   |   |   |
| Home Improvement Contractors                        |   | Vinyl replacement windows; metal coils,  raincarrying systems; metal roofing and insulated roofing panels; shower,  patio and entrance doors; and awnings     |   | 20,919                                   |    | 40,248                                         |   | 51,954                             |   | 44,680 |   |
|                                                |   |                                                                                                                                                          |   | $                                        | 260,615 |                                           | $      | 483,688                            |   | $ | 639,149 |   | $ | 593,117 |   |

 

65

----

 

Thefollowing table reflects goodwill balances and activity by reportable segmentfor the years ended December 26, 2003 and December 27, 2002:

 
|                                      |   | **European  Roll  Coating** |   | **U.S. Fabrication  Roof  Drainage** |   | **U.S.  Fabrication  Building  Materials** |   | **European  Fabrication** |   | **Total** |   |
|-------------------------------------------|--------|-----------------------------|--------|--------------------------------------|--------|--------------------------------------------|--------|---------------------------|--------|-----------|--------|
|                                      |   |                        |   |                                 |   |                                       |   |                      |   |      |   |
| Predecessor  balance at December 28, 2001 |   | $                           | 16,412 |                                 | $      | 49,585                                     |   | $                         | 35,930 |      | $      | 5,331 |   | $ | 107,258 |   |
|                                      |   |                        |   |                                 |   |                                       |   |                      |   |      |   |
| Foreign exchange  translation             |   | 2,975                       |   | —                               |   | —                                     |   | 566                       |   | 3,541     |   |
| Predecessor  balance at December 27, 2002 |   | 19,387                      |   | 49,585                               |   | 35,930                                     |   | 5,897                     |   | 110,799   |   |
|                                      |   |                        |   |                                 |   |                                       |   |                      |   |      |   |
| 2003 Stock  Transaction                   |   | 13,296                      |   | 10,682                               |   | 13,971                                     |   | 5,049                     |   | 42,998    |   |
| Berger Holdings  acquisition              |   | —                      |   | 18,674                               |   | —                                     |   | —                    |   | 18,674    |   |
| Foreign exchange  translation             |   | 4,286                       |   | —                               |   | —                                     |   | 1,023                     |   | 5,309     |   |
| Other                                     |   | —                      |   | (462                                 | )      | (924                                       | )      | —                    |   | (1,386    | )      |
| Successor  balance at December 26, 2003   |   | $                           | 36,969 |                                 | $      | 78,479                                     |   | $                         | 48,977 |      | $      | 11,969 |   | $ | 176,394 |   |

 

Thefollowing table reflects sales and long-lived asset information by geographicarea for the periods indicated:

 
|            |   | **Sales**                                          |    |
|-----------------|--------|----------------------------------------------------|---------|
|            |   | **Predecessor  five months  ended  May 23,  2003** |    | **Successor  seven months  ended  December 26,  2003** |   | **Predecessor  year ended  December 27,  2002** |   | **Predecessor  year ended  December 28,  2001** |   |
|            |   |                                               |    |   |   |   |   |   |   |
| United States   |   | $                                                  | 161,050 |   | $ | 325,934 |   | $ | 440,901 |   | $ | 406,799 |   |
| The Netherlands |   | 40,277                                             |    | 67,656 |   | 84,388 |   | 82,614 |   |
| United Kingdom  |   | 39,025                                             |    | 56,733 |   | 79,293 |   | 74,579 |   |
| France          |   | 20,263                                             |    | 33,365 |   | 34,567 |   | 29,125 |   |
|            |   | $                                                  | 260,615 |   | $ | 483,688 |   | $ | 639,149 |   | $ | 593,117 |   |

 
|            |   | **Long-Lived  Assets**            |    |
|-----------------|--------|-----------------------------------|---------|
|            |   | **Successor  December 26,  2003** |    | **Predecessor  December 27,  2002** |   |
|            |   |                              |    |   |   |
| United States   |   | $                                 | 207,525 |   | $ | 138,917 |   |
| The Netherlands |   | 69,483                            |    | 41,756 |   |
| United Kingdom  |   | 48,168                            |    | 37,840 |   |
| France          |   | 12,411                            |    | 9,237 |   |
|            |   | $                                 | 337,587 |   | $ | 227,750 |   |

 

Non-U.S. revenue is based on the country in which the legal subsidiaryis domiciled. The Company’s largest customer

 

66

----

accountedfor 11.8% of 2003 and 2002 net sales. Sales from this customer are included inthe Company’s U.S. Fabrication Roof Drainage and U.S. Fabrication BuildingMaterials segments. As of December 26, 2003, this customer had an outstandingtrade receivable balance of $10.4 million. No other customer representedgreater than ten percent of the Company’s revenues in any period presented.

 

**16.  Related Party Transactions**

 

**2003Stock Transaction**

TheCompany entered into a stock purchase agreement on April 15, 2003, with CVCEP,certain affiliates of CVCEP, CVC Europe, BNP Paribas and certain otherstockholders. Pursuant to the stock purchase agreement, on June 12, 2003, CVCEPand its affiliates acquired from the Company’s former stockholders, CVC Europeand BNP Paribas, and certain members of management, 265,762.48 shares of commonstock, or approximately 54% of the Company’s common stock. In connection withthe 2003 Stock Transaction, the Company sold 883.75 shares of common stockdirectly to CVCEP for $353,500. The Company also agreed to pay the out ofpocket fees and expenses of CVCEP and CVC Europe, which in aggregate wereapproximately $3.8 million, and gave certain customary indemnities in favor ofCVCEP under the stock purchase agreement. CVCEP is an affiliate of CVC, whichowned approximately 34.5% of the Company’s common stock at the time of the 2003Stock Transaction. CVC has subsequently transferred these shares to CourtSquare Capital, Ltd., or Court Square, which, like CVC, is an indirectwholly-owned subsidiary of Citigroup, Inc.

 

**Repurchases of Common Stock**

Inconnection with the retirement of certain key employees from the Company, theCompany repurchased 6,649.2 shares of Euramax International Class A commonstock in 2003, for approximately $2.6 million in the aggregate.

 

TheCompany has entered into an agreement with Court Square, dated as of February12, 2004, pursuant to which it has agreed to repurchase all of its outstandingcommon stock held by Court Square, or 169,680.62 shares, totaling an aggregaterepurchase price of approximately $67.9 million. This transaction is subject torestrictions contained in the indenture to the 8.50% Notes and in the seniorsecured credit facility. The Company expects to complete this transaction on orbefore April 30, 2004.

 

**Stockholders Agreement**

Inconnection with the 2003 Stock Transaction, the Company entered into astockholders agreement with CVCEP and certain of its affiliates, Court Square,and certain other stockholders consisting of members of the Company’smanagement and members of CVCEP’s management (“Minority Stockholders”). Thestockholders agreement provides that the Company’s Chief Executive Officer willbe a member of the Company’s board of directors. CVCEP will initially beentitled to designate three additional members of the Company’s board ofdirectors and Court Square will initially be entitled to designate twoadditional members of the Company’s board of directors (these designationrights to be adjusted from time to time to reflect certain changes in thecommon stock ownership of CVCEP and Court Square).

 

Underthe stockholders agreement, certain corporate actions require the writtenconsent of stockholders holding at least 70% of the Company’s outstanding stockheld by all stockholders party to the stockholders agreement. Initially, thiswill require the written consent of both CVCEP and Court Square. Thesecorporate actions include changes to or issuances of the Company’s equitysecurities, amendments of organizational documents, payment of dividends, orcertain merger or recapitalization transactions. In addition, each action ofthe board of directors will require the approval of at least one directordesignated by each of CVCEP and Court Square.

 

Thestockholders agreement generally restricts the transfer of shares of theCompany’s common stock. Exceptions to this

 

67

----

 

restriction include transfersto affiliates, transfers to the Company, transfers for estate planning purposesand transfers to family members. In each case, so long as any transferee agreesto be bound by the terms of the stockholders agreement. After an initial publicoffering, additional exceptions to the transfer restrictions will include salespursuant to certain registration rights of the stockholders.

 

**Registration Rights Agreement**

Inconnection with their entry into the stockholders agreement, CVCEP, CourtSquare and the Minority Stockholders have entered into an amended and restatedregistration rights agreement with the Company. Pursuant to this registrationrights agreement, upon the written request of CVCEP or Court Square, theCompany has agreed (subject to customary exceptions), on up to three occasionsfor CVCEP and up to two occasions for Court Square, to prepare and file aregistration statement with the SEC concerning the distribution of all or partof the shares held by CVCEP or Court Square, as the case may be, and use itsbest efforts to cause the registration statement to become effective. If theCompany is eligible to use a “short form” registration statement on Form S-2,Form S-3 or any similar form, CVCEP and Court Square may each make unlimitedrequests for registration for their shares of the Company’s common stock. If atany time the Company files a registration statement for its common stock (otherthan pursuant to a demand registration by CVCEP or Court Square, a registrationstatement on Form S-8, Form S-4 or any similar form, or in connection withcertain other registrations), it will use its best efforts to allow otherparties to the registration rights agreement to have their shares of theCompany’s common stock (or a portion of their shares under specifiedcircumstances) included in the offering if the registration form proposed to beused may be used to register the shares. Registration expenses of the sellingstockholders (other than underwriting fees, brokerage fees and transfer taxesapplicable to the shares sold by such stockholders or the fees and expenses ofany accountants or other representatives retained by a selling stockholder)will be paid by the Company. The Company has agreed to indemnify thestockholders against certain customary liabilities in connection with anyregistration.

 

**Advisory Agreement**

Inconnection with the 2003 Stock Transaction, the Company entered into anadvisory agreement with CVC Management LLC, or CVC Management, pursuant towhich CVC Management may provide financial, advisory and consulting services tothe Company. In exchange for these services, CVC Management will be entitled toan annual advisory fee. CVC Management’s annual advisory fee will be thegreater of $0.6 million per year or 1% of the Company’s consolidated EBITDA (asdefined in the advisory agreement), plus out-of-pocket expenses. Annualadvisory fees in excess of $1.0 million are subject to the consent of theCompany’s lenders under the credit facility. In December 2003, the Company paid$0.8 million to CVC Management for the 2003 annual advisory fee. The Companyhas also agreed to pay CVC Management a transaction fee in connection with theconsummation of each acquisition, divestiture or financing, including anyrefinancing, by the Company or any of its subsidiaries, in an amount equal to1% of the value of the transaction, plus reasonable out-of-pocket expenses.Pursuant to the advisory agreement, the Company paid CVC Management a $1.0million transaction fee in July 2003 in connection with services provided inconnection with the 2003 Stock Transaction, a $2.0 million transaction fee inAugust 2003 in connection with the issuance and sale of the 8.5% Notes and a$1.45 million transaction fee in October 2003 in connection with the amendmentand restatement of the senior secured credit facility. These transaction feeswere capitalized. This advisory agreement has an initial term of ten yearsfollowing the close of the 2003 Stock Transaction, subject to automatic oneyear extensions thereafter unless terminated by either party upon writtennotice 90 days prior to the expiration of the initial term or any extensionthereof. The advisory agreement automatically terminates on a change of controlor an initial public offering of the Company’s common stock. There are nominimum levels of service required to be provided pursuant to the advisoryagreement. The advisory agreement includes customary indemnification provisionsin favor of CVC Management.

 

68

----

 

**17.  Supplemental Consolidated FinancialStatements:**

 

On August 6, 2003, Euramax International, Inc. and Euramax InternationalHoldings B.V. (each a “Co-Obligor”) issued the 8.50% Notes. Each of thedomestic restricted subsidiaries, as defined in the related bond indenture (the“Guarantor Subsidiaries”), fully and unconditionally guarantee the obligationsof the Co-Obligors. The following supplemental consolidating financialstatements as of December 26, 2003 and December 27, 2002, and for the fivemonths ended May 23, 2003, seven months ended December 26, 2003 and years endedDecember 27, 2002 and December 28, 2001, reflect the financial position,results of operations, and cash flows of each of the Co-Obligors, and suchcombined information of the Guarantor Subsidiaries and the non-guarantorsubsidiaries, as if the guarantor structure of the 8.50% Notes had been outstandingfor each period. Euramax International Holdings B.V. was not acquired untilJuly 17, 2003 and had no operations and had no assets or liabilities untilAugust 6, 2003.

 
|                                    |   | **Predecessor  five months ended May 23, 2003** |   |
|-----------------------------------------|--------|-------------------------------------------------|--------|
|                                    |   | **Euramax  International  Inc.  (Co-Obligor)**  |   | **Euramax  International  Holdings  BV  (Co-Obligor)** |   | **Guarantor  Subsidiaries** |   | **Non-  Guarantor  Subsidiaries** |   | **Eliminations** |   | **Consolidated  Totals** |   |
|                                    |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Net sales                               |   | $                                               | — |   | $ | — |   | $ | 161,065 |   | $ | 99,851 |   | $ | (301 | ) | $ | 260,615 |   |
|                                    |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Costs and expenses:                     |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Cost of goods sold                      |   | —                                          |   | — |   | 130,949 |   | 77,772 |   | (301 | ) | 208,420 |   |
| Selling and general                     |   | 393                                             |   | — |   | 17,473 |   | 8,287 |   | — |   | 26,153 |   |
| Depreciation and amortization           |   | —                                          |   | — |   | 3,307 |   | 2,969 |   | — |   | 6,276 |   |
|                                    |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| (Loss) earnings from operations         |   | (393                                            | )      | — |   | 9,336 |   | 10,823 |   | — |   | 19,766 |   |
|                                    |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Equity in earnings of subsidiaries      |   | 8,980                                           |   | — |   | — |   | (53 | ) | (8,927 | ) | — |   |
| Interest expense, net                   |   | (1,745                                          | )      | — |   | (1,466 | ) | (5,915 | ) | — |   | (9,126 | ) |
| Internal interest (income) expense, net |   | (1,120                                          | )      | — |   | (2,931 | ) | 4,051 |   | — |   | — |   |
| Other income (expense), net             |   | —                                          |   | — |   | 103 |   | 403 |   | — |   | 506 |   |
|                                    |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Earnings before income taxes            |   | 5,722                                           |   | — |   | 5,042 |   | 9,309 |   | (8,927 | ) | 11,146 |   |
|                                    |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| (Benefit) provision for income taxes    |   | (1,170                                          | )      | — |   | 2,253 |   | 3,171 |   | — |   | 4,254 |   |
|                                    |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Net earnings                            |   | $                                               | 6,892  |   | $ | — |   | $ | 2,789 |   | $ | 6,138 |   | $ | (8,927 | ) | $ | 6,892 |   |

 

69

----

 
|                                    |   | **Successor  seven months ended December 26, 2003** |   |
|-----------------------------------------|--------|-----------------------------------------------------|--------|
|                                    |   | **Euramax  International  Inc.  (Co-Obligor)**      |   | **Euramax  International  Holdings  BV  (Co-Obligor)** |   | **Guarantor  Subsidiaries** |   | **Non-  Guarantor  Subsidiaries** |   | **Eliminations** |   | **Consolidated  Totals** |   |
|                                    |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Net sales                               |   | $                                                   | — |   | $ | — |   | $ | 326,001 |   | $ | 158,213 |   | $ | (526 | ) | $ | 483,688 |   |
|                                    |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Costs and expenses:                     |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Cost of goods sold                      |   | —                                              |   | — |   | 262,919 |   | 126,436 |   | (526 | ) | 388,829 |   |
| Selling and general                     |   | 2,379                                               |   | — |   | 33,770 |   | 13,500 |   | — |   | 49,649 |   |
| Depreciation and amortization           |   | —                                              |   | — |   | 5,485 |   | 5,154 |   | — |   | 10,639 |   |
|                                    |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| (Loss) earnings from operations         |   | (2,379                                              | )      | — |   | 23,827 |   | 13,123 |   | — |   | 34,571 |   |
|                                    |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Equity in earnings of subsidiaries      |   | 18,610                                              |   | — |   | — |   | 108 |   | (18,718 | ) | — |   |
| Interest expense, net                   |   | (5,900                                              | )      | (2,223 | ) | (965 | ) | (3,571 | ) | — |   | (12,659 | ) |
| Internal interest (income) expense, net |   | (679                                                | )      | 2,041 |   | (3,956 | ) | 2,594 |   | — |   | — |   |
| Other income (expense), net             |   | 2,579                                               |   | 1,098 |   | 140 |   | (3,865 | ) | — |   | (48 | ) |
|                                    |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Earnings before income taxes            |   | 12,231                                              |   | 916 |   | 19,046 |   | 8,389 |   | (18,718 | ) | 21,864 |   |
|                                    |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| (Benefit) provision for income taxes    |   | (2,525                                              | )      | 315 |   | 6,786 |   | 2,532 |   | — |   | 7,108 |   |
|                                    |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Net earnings                            |   | $                                                   | 14,756 |   | $ | 601 |   | $ | 12,260 |   | $ | 5,857 |   | $ | (18,718 | ) | $ | 14,756 |   |

 

70

----

 
|                                    |   | **Predecessor  year ended December 27, 2002**  |   |
|-----------------------------------------|--------|------------------------------------------------|--------|
|                                    |   | **Euramax  International  Inc.  (Co-Obligor)** |   | **Euramax  International  Holdings  BV  (Co-Obligor)** |   | **Guarantor  Subsidiaries** |   | **Non-  Guarantor  Subsidiaries** |   | **Eliminations** |   | **Consolidated  Totals** |   |
|                                    |   |                                           |   |   |   |   |   |   |   |   |   |   |   |
| Net sales                               |   | $                                              | — |   | $ | — |   | $ | 440,901 |   | $ | 198,712 |   | $ | (464 | ) | $ | 639,149 |   |
|                                    |   |                                           |   |   |   |   |   |   |   |   |   |   |   |
| Costs and expenses:                     |   |                                           |   |   |   |   |   |   |   |   |   |   |   |
| Cost of goods sold                      |   | —                                         |   | — |   | 350,601 |   | 158,117 |   | (464 | ) | 508,254 |   |
| Selling and general                     |   | 2,039                                          |   | — |   | 44,045 |   | 17,509 |   | — |   | 63,593 |   |
| Depreciation and amortization           |   | —                                         |   | — |   | 7,831 |   | 6,137 |   | — |   | 13,968 |   |
|                                    |   |                                           |   |   |   |   |   |   |   |   |   |   |   |
| (Loss) earnings from operations         |   | (2,039                                         | )      | — |   | 38,424 |   | 16,949 |   | — |   | 53,334 |   |
|                                    |   |                                           |   |   |   |   |   |   |   |   |   |   |   |
| Equity in earnings of subsidiaries      |   | 25,793                                         |   | — |   | — |   | 60 |   | (25,853 | ) | — |   |
| Interest expense, net                   |   | (4,224                                         | )      | — |   | (4,111 | ) | (14,413 | ) | — |   | (22,748 | ) |
| Internal interest (income) expense, net |   | (1,909                                         | )      | — |   | (6,256 | ) | 8,165 |   | — |   | — |   |
| Other (expense) income, net             |   | —                                         |   | — |   | (134 | ) | 837 |   | — |   | 703 |   |
|                                    |   |                                           |   |   |   |   |   |   |   |   |   |   |   |
| Earnings before income taxes            |   | 17,621                                         |   | — |   | 27,923 |   | 11,598 |   | (25,853 | ) | 31,289 |   |
|                                    |   |                                           |   |   |   |   |   |   |   |   |   |   |   |
| (Benefit) provision for income taxes    |   | (2,236                                         | )      | — |   | 9,787 |   | 3,881 |   | — |   | 11,432 |   |
|                                    |   |                                           |   |   |   |   |   |   |   |   |   |   |   |
| Net earnings                            |   | $                                              | 19,857 |   | $ | — |   | $ | 18,136 |   | $ | 7,717 |   | $ | (25,853 | ) | $ | 19,857 |   |

 

71

----

 
|                                    |   | **Predecessor  year ended December 28, 2001**  |   |
|-----------------------------------------|--------|------------------------------------------------|--------|
|                                    |   | **Euramax  International  Inc.  (Co-Obligor)** |   | **Euramax  International  Holdings  BV  (Co-Obligor)** |   | **Guarantor  Subsidiaries** |   | **Non-  Guarantor  Subsidiaries** |   | **Eliminations** |   | **Consolidated  Totals** |   |
|                                    |   |                                           |   |   |   |   |   |   |   |   |   |   |   |
| Net sales                               |   | $                                              | — |   | $ | — |   | $ | 406,835 |   | $ | 186,776 |   | $ | (494 | ) | $ | 593,117 |   |
|                                    |   |                                           |   |   |   |   |   |   |   |   |   |   |   |
| Costs and expenses:                     |   |                                           |   |   |   |   |   |   |   |   |   |   |   |
| Cost of goods sold                      |   | —                                         |   | — |   | 327,891 |   | 150,473 |   | (494 | ) | 477,870 |   |
| Selling and general                     |   | 1,251                                          |   | — |   | 43,186 |   | 14,793 |   | — |   | 59,230 |   |
| Depreciation and amortization           |   | —                                         |   | — |   | 11,549 |   | 6,006 |   | — |   | 17,555 |   |
|                                    |   |                                           |   |   |   |   |   |   |   |   |   |   |   |
| (Loss) earnings from operations         |   | (1,251                                         | )      | — |   | 24,209 |   | 15,504 |   | — |   | 38,462 |   |
|                                    |   |                                           |   |   |   |   |   |   |   |   |   |   |   |
| Equity in earnings of subsidiaries      |   | 9,122                                          |   | — |   | — |   | (210 | ) | (8,912 | ) | — |   |
| Interest expense, net                   |   | (4,187                                         | )      | — |   | (6,348 | ) | (14,723 | ) | — |   | (25,258 | ) |
| Internal interest (income) expense, net |   | (1,297                                         | )      | — |   | (6,678 | ) | 7,975 |   | — |   | — |   |
| Other expense, net                      |   | (19                                            | )      | — |   | (2,366 | ) | (568 | ) | — |   | (2,953 | ) |
|                                    |   |                                           |   |   |   |   |   |   |   |   |   |   |   |
| Earnings before income taxes            |   | 2,368                                          |   | — |   | 8,817 |   | 7,978 |   | (8,912 | ) | 10,251 |   |
|                                    |   |                                           |   |   |   |   |   |   |   |   |   |   |   |
| (Benefit) provision for income taxes    |   | (2,362                                         | )      | — |   | 3,942 |   | 3,941 |   | — |   | 5,521 |   |
|                                    |   |                                           |   |   |   |   |   |   |   |   |   |   |   |
| Net earnings                            |   | $                                              | 4,730  |   | $ | — |   | $ | 4,875 |   | $ | 4,037 |   | $ | (8,912 | ) | $ | 4,730 |   |

 

72

----

 
|                                           |   | **Successor  as of December 26, 2003**          |    |
|------------------------------------------------|--------|-------------------------------------------------|---------|
|                                           |   | **Euramax  International,  Inc.  (Co-Obligor)** |    | **Euramax  International  Holdings B.V.  (Co-Obligor)** |   | **Guarantor  Subsidiaries** |   | **Non-  Guarantor  Subsidiaries** |   | **Eliminations** |   | **Consolidated  Totals** |   |
| **ASSETS**                                     |   |                                            |    |   |   |   |   |   |   |   |   |   |   |
| Current assets:                                |   |                                            |    |   |   |   |   |   |   |   |   |   |   |
| Cash and cash equivalents                      |   | $                                               | —  |   | $ | 21 |   | $ | 19,408 |   | $ | 28,798 |   | $ | — |   | $ | 48,227 |   |
| Accounts receivable, net                       |   | —                                          |    | — |   | 56,753 |   | 64,936 |   | — |   | 121,689 |   |
| Inventories                                    |   | —                                          |    | — |   | 59,249 |   | 30,294 |   | — |   | 89,543 |   |
| Deferred income taxes                          |   | 111                                             |    | — |   | 6,207 |   | — |   | — |   | 6,318 |   |
| Other current assets                           |   | —                                          |    | — |   | 997 |   | 873 |   | — |   | 1,870 |   |
| Total current assets                           |   | 111                                             |    | 21 |   | 142,614 |   | 124,901 |   | — |   | 267,647 |   |
| Property, plant and equipment, net             |   | —                                          |    | — |   | 64,865 |   | 76,572 |   | — |   | 141,437 |   |
| Amounts due from affiliates                    |   | 144,695                                         |    | 62,932 |   | 21,792 |   | 37,924 |   | (267,343 | ) | — |   |
| Goodwill, net                                  |   | —                                          |    | — |   | 127,457 |   | 48,937 |   | — |   | 176,394 |   |
| Investment in consolidated subsidiaries        |   | 277,405                                         |    | — |   | — |   | 1,110 |   | (278,515 | ) | — |   |
| Deferred income taxes                          |   | 75                                              |    | — |   | 3 |   | 3,517 |   | — |   | 3,595 |   |
| Other assets                                   |   | 5,723                                           |    | 2,866 |   | 9,478 |   | 1,689 |   | — |   | 19,756 |   |
|                                           |   | $                                               | 428,009 |   | $ | 65,819 |   | $ | 366,209 |   | $ | 294,650 |   | $ | (545,858 | ) | $ | 608,829 |   |
| **LIABILITIES AND SHAREHOLDERS’ EQUITY**  |   |                                            |    |   |   |   |   |   |   |   |   |   |   |
| Current liabilities:                           |   |                                            |    |   |   |   |   |   |   |   |   |   |   |
| Cash overdrafts                                |   | $                                               | —  |   | $ | — |   | $ | 436 |   | $ | — |   | $ | — |   | $ | 436 |   |
| Accounts payable                               |   | —                                          |    | — |   | 49,817 |   | 41,872 |   | — |   | 91,689 |   |
| Accrued expenses                               |   | 782                                             |    | — |   | 26,097 |   | 12,525 |   | — |   | 39,404 |   |
| Accrued interest payable                       |   | 4,477                                           |    | 2,092 |   | 129 |   | 370 |   | — |   | 7,068 |   |
| Income taxes payable                           |   | (4,720                                          | )       | (71 | ) | 3,686 |   | 4,936 |   | — |   | 3,831 |   |
| Deferred income taxes                          |   | —                                          |    | — |   | — |   | 936 |   | — |   | 936 |   |
| Current maturities of long-term debt           |   | —                                          |    | — |   | 436 |   | 7,051 |   | — |   | 7,487 |   |
| Total current liabilities                      |   | 539                                             |    | 2,021 |   | 80,601 |   | 67,690 |   | — |   | 150,851 |   |
| Long-term debt, less current maturities        |   | 137,255                                         |    | 62,745 |   | 2,299 |   | 29,508 |   | — |   | 231,807 |   |
| Amounts due to affiliates                      |   | 121,004                                         |    | 2 |   | 122,504 |   | 23,833 |   | (267,343 | ) | — |   |
| Deferred income taxes                          |   | —                                          |    | 398 |   | 14,308 |   | 14,576 |   | — |   | 29,282 |   |
| Other liabilities                              |   | —                                          |    | — |   | 5,355 |   | 21,584 |   | — |   | 26,939 |   |
| Total liabilities                              |   | 258,798                                         |    | 65,166 |   | 225,067 |   | 157,191 |   | (267,343 | ) | 438,879 |   |
| Shareholders’equity:                      |   |                                            |    |   |   |   |   |   |   |   |   |   |   |
| Class A common stock                           |   | 500                                             |    | 21 |   | 1 |   | 35,000 |   | (35,022 | ) | 500 |   |
| Additional paid-in capital                     |   | 155,866                                         |    | — |   | 125,681 |   | 78,066 |   | (204,118 | ) | 155,495 |   |
| Treasury stock                                 |   | (1,964                                          | )       | — |   | — |   | — |   | — |   | (1,964 | ) |
| Restricted stock                               |   | (3,381                                          | )       | — |   | — |   | — |   | — |   | (3,381 | ) |
| Retained earnings                              |   | 14,756                                          |    | 601 |   | 15,468 |   | 10,266 |   | (26,335 | ) | 14,756 |   |
| Accumulated other comprehensive income  (loss) |   | 3,434                                           |    | 31 |   | (8 | ) | 14,127 |   | (13,040 | ) | 4,544 |   |
| Total shareholders’ equity                |   | 169,211                                         |    | 653 |   | 141,142 |   | 137,459 |   | (278,515 | ) | 169,950 |   |
|                                           |   | $                                               | 428,009 |   | $ | 65,819 |   | $ | 366,209 |   | $ | 294,650 |   | $ | (545,858 | ) | $ | 608,829 |   |

 

73

----

 
|                                          |   | **Predecessor  as of December 27, 2002**        |    |
|-----------------------------------------------|--------|-------------------------------------------------|---------|
|                                          |   | **Euramax  International,  Inc.  (Co-Obligor)** |    | **Euramax  International  Holdings B.V.  (Co-Obligor)** |   | **Guarantor  Subsidiaries** |   | **Non-  Guarantor  Subsidiaries** |   | **Eliminations** |   | **Consolidated  Totals** |   |
| **ASSETS**                                    |   |                                            |    |   |   |   |   |   |   |   |   |   |   |
| Current assets:                               |   |                                            |    |   |   |   |   |   |   |   |   |   |   |
| Cash and cash equivalents                     |   | $                                               | —  |   | $ | — |   | $ | 560 |   | $ | 11,086 |   | $ | — |   | $ | 11,646 |   |
| Accounts receivable, net                      |   | —                                          |    | — |   | 39,466 |   | 49,042 |   | — |   | 88,508 |   |
| Inventories                                   |   | —                                          |    | — |   | 53,816 |   | 24,664 |   | — |   | 78,480 |   |
| Deferred income taxes                         |   | 508                                             |    | — |   | 3,396 |   | — |   | — |   | 3,904 |   |
| Other current assets                          |   | —                                          |    | — |   | 697 |   | 480 |   | — |   | 1,177 |   |
| Total current assets                          |   | 508                                             |    | — |   | 97,935 |   | 85,272 |   | — |   | 183,715 |   |
| Property, plant and equipment, net            |   | —                                          |    | — |   | 51,138 |   | 60,899 |   | — |   | 112,037 |   |
| Amounts due from affiliates                   |   | 102,124                                         |    | — |   | 151,508 |   | 75,701 |   | (329,333 | ) | — |   |
| Goodwill, net                                 |   | —                                          |    | — |   | 85,515 |   | 25,284 |   | — |   | 110,799 |   |
| Investment in consolidated subsidiaries       |   | 153,844                                         |    | — |   | — |   | 63,308 |   | (217,152 | ) | — |   |
| Deferred income taxes                         |   | —                                          |    | — |   | 435 |   | 4,540 |   | — |   | 4,975 |   |
| Other assets                                  |   | —                                          |    | — |   | 2,264 |   | 2,650 |   | — |   | 4,914 |   |
|                                          |   | $                                               | 256,476 |   | $ | — |   | $ | 388,795 |   | $ | 317,654 |   | $ | (546,485 | ) | $ | 416,440 |   |
| **LIABILITIES AND SHAREHOLDERS’ EQUITY** |   |                                            |    |   |   |   |   |   |   |   |   |   |   |
| Current liabilities:                          |   |                                            |    |   |   |   |   |   |   |   |   |   |   |
| Cash overdrafts                               |   | $                                               | —  |   | $ | — |   | $ | 1,880 |   | $ | — |   | $ | — |   | $ | 1,880 |   |
| Accounts payable                              |   | —                                          |    | — |   | 25,856 |   | 31,248 |   | — |   | 57,104 |   |
| Accrued expenses                              |   | 767                                             |    | — |   | 17,689 |   | 9,701 |   | — |   | 28,157 |   |
| Accrued interest payable                      |   | 1,047                                           |    | — |   | 264 |   | 2,967 |   | — |   | 4,278 |   |
| Income taxes payable                          |   | (3,036                                          | )       | — |   | 648 |   | 3,199 |   | — |   | 811 |   |
| Deferred income taxes                         |   | —                                          |    | — |   | 184 |   | 821 |   | — |   | 1,005 |   |
| Total current liabilities                     |   | (1,222                                          | )       | — |   | 46,521 |   | 47,936 |   | — |   | 93,235 |   |
| Long-term debt, less current maturities       |   | 37,216                                          |    | — |   | 31,700 |   | 128,056 |   | — |   | 196,972 |   |
| Amounts due to affiliates                     |   | 133,239                                         |    | — |   | 173,467 |   | 22,627 |   | (329,333 | ) | — |   |
| Deferred income taxes                         |   | 614                                             |    | — |   | 7,356 |   | 11,451 |   | — |   | 19,421 |   |
| Other liabilities                             |   | —                                          |    | — |   | 3,940 |   | 16,653 |   | — |   | 20,593 |   |
| Total liabilities                             |   | 169,847                                         |    | — |   | 262,984 |   | 226,723 |   | (329,333 | ) | 330,221 |   |
| Shareholders’equity:                     |   |                                            |    |   |   |   |   |   |   |   |   |   |   |
| Class A common stock                          |   | 456                                             |    | — |   | 1 |   | 35,000 |   | (35,001 | ) | 456 |   |
| Class B convertible common stock              |   | 44                                              |    | — |   | — |   | — |   | — |   | 44 |   |
| Additional paid-in capital                    |   | 65,218                                          |    | — |   | 64,767 |   | 61,480 |   | (138,245 | ) | 53,220 |   |
| Treasury stock                                |   | (2,056                                          | )       | — |   | — |   | — |   | — |   | (2,056 | ) |
| Retained earnings (deficit)                   |   | 27,652                                          |    | — |   | 62,672 |   | (1,730 | ) | (44,155 | ) | 44,439 |   |
| Accumulated other comprehensive loss          |   | (4,685                                          | )       | — |   | (1,629 | ) | (3,819 | ) | 249 |   | (9,884 | ) |
| Total shareholders’ equity               |   | 86,629                                          |    | — |   | 125,811 |   | 90,931 |   | (217,152 | ) | 86,219 |   |
|                                          |   | $                                               | 256,476 |   | $ | — |   | $ | 388,795 |   | $ | 317,654 |   | $ | (546,485 | ) | $ | 416,440 |   |

 

74

----

 
|                                                                                |   | **Predecessor  five months ended May 23, 2003** |   |
|-------------------------------------------------------------------------------------|--------|-------------------------------------------------|--------|
|                                                                                |   | **Euramax  International,  Inc.  (Co-Obligor)** |   | **Euramax  International  Holdings B.V.  (Co-Obligor)** |   | **Guarantor  Subsidiaries** |   | **Non-  Guarantor  Subsidiaries** |   | **Eliminations** |   | **Consolidated  Totals** |   |
| Cash flows from operating activities:                                               |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Net earnings                                                                        |   | $                                               | 6,892  |   | $ | — |   | $ | 2,789 |   | $ | 6,138 |   | $ | (8,927 | ) | $ | 6,892 |   |
| Reconciliation of net earnings to cash  (used in) provided by operating activities: |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization                                                       |   | —                                          |   | — |   | 3,307 |   | 2,969 |   | — |   | 6,276 |   |
| Amortization of deferred finance fees                                               |   | —                                          |   | — |   | 228 |   | 335 |   | — |   | 563 |   |
| Provision for doubtful accounts                                                     |   | —                                          |   | — |   | 90 |   | 122 |   | — |   | 212 |   |
| Foreign exchange gain                                                               |   | —                                          |   | — |   | — |   | (405 | ) | — |   | (405 | ) |
| Loss (gain) on sale of assets                                                       |   | —                                          |   | — |   | 6 |   | (38 | ) | — |   | (32 | ) |
| Deferred income taxes                                                               |   | 26                                              |   | — |   | 107 |   | 2,029 |   | — |   | 2,162 |   |
| Dividends received                                                                  |   | —                                          |   | — |   | — |   | 62,253 |   | (62,253 | ) | — |   |
| Equity in (earnings) loss of subsidiaries                                           |   | (8,980                                          | )      | — |   | — |   | 53 |   | 8,927 |   | — |   |
| Changes in operating assets and liabilities                                         |   | (1,534                                          | )      | — |   | (16,084 | ) | (10,095 | ) | — |   | (27,713 | ) |
| Net cash (used in) provided by operating  activities                                |   | (3,596                                          | )      | — |   | (9,557 | ) | 63,361 |   | (62,253 | ) | (12,045 | ) |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Cash flows from investing activites:                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Proceeds from sale of assets                                                        |   | —                                          |   | — |   | 7 |   | 28 |   | — |   | 35 |   |
| Capital expenditures                                                                |   | —                                          |   | — |   | (2,283 | ) | (2,661 | ) | — |   | (4,944 | ) |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Net cash used in investing activities                                               |   | —                                          |   | — |   | (2,276 | ) | (2,633 | ) | — |   | (4,909 | ) |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Cash flows from financing activities:                                               |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Changes in cash overdrafts                                                          |   | —                                          |   | — |   | 2,603 |   | — |   | — |   | 2,603 |   |
| Net borrowings on revolving credit facility                                         |   | —                                          |   | — |   | 16,800 |   | 1,464 |   | — |   | 18,264 |   |
| Dividends paid                                                                      |   | —                                          |   | — |   | (62,253 | ) | — |   | 62,253 |   | — |   |
| Deferred finance fees                                                               |   | —                                          |   | — |   | (71 | ) | (45 | ) | — |   | (116 | ) |
| Purchase of treasury stock                                                          |   | (2,556                                          | )      | — |   | — |   | — |   | — |   | (2,556 | ) |
| Due (to) from affiliates                                                            |   | 6,152                                           |   | — |   | 54,864 |   | (61,016 | ) | — |   | — |   |
| Net cash provided by (used in) financing  activities                                |   | 3,596                                           |   | — |   | 11,943 |   | (59,597 | ) | 62,253 |   | 18,195 |   |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Effect of exchange rate changes on cash                                             |   | —                                          |   | — |   | — |   | 778 |   | — |   | 778 |   |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Net increase in cash and cash equivalents                                           |   | —                                          |   | — |   | 110 |   | 1,909 |   | — |   | 2,019 |   |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Cash and cash equivalents at beginning of  period                                   |   | —                                          |   | — |   | 560 |   | 11,086 |   | — |   | 11,646 |   |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Cash and cash equivalents at end of period                                          |   | $                                               | — |   | $ | — |   | $ | 670 |   | $ | 12,995 |   | $ | — |   | $ | 13,665 |   |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Supplemental cash flow information:                                                 |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Income taxes paid, net                                                              |   | $                                               | 7      |   | $ | — |   | $ | 104 |   | $ | 1,150 |   | $ | — |   | $ | 1,261 |   |
| Interest paid, net                                                                  |   | $                                               | 2,093  |   | $ | — |   | $ | 1,055 |   | $ | 6,462 |   | $ | — |   | $ | 9,610 |   |

 

75

----

 
|                                                                                |   | **Successor  seven months ended December 26, 2003** |   |
|-------------------------------------------------------------------------------------|--------|-----------------------------------------------------|--------|
|                                                                                |   | **Euramax  International,  Inc.  (Co-Obligor)**     |   | **Euramax  International  Holdings B.V.  (Co-Obligor)** |   | **Guarantor  Subsidiaries** |   | **Non-  Guarantor  Subsidiaries** |   | **Eliminations** |   | **Consolidated  Totals** |   |
| Cash flows from operating activities:                                               |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Net earnings                                                                        |   | $                                                   | 14,756 |   | $ | 601 |   | $ | 12,260 |   | $ | 5,857 |   | $ | (18,718 | ) | $ | 14,756 |   |
| Reconciliation of net earnings to cash  (used in) provided by operating activities: |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization                                                       |   | —                                              |   | — |   | 5,485 |   | 5,154 |   | — |   | 10,639 |   |
| Amortization of deferred finance fees                                               |   | 281                                                 |   | 132 |   | 356 |   | 265 |   | — |   | 1,034 |   |
| Amortization of restricted stock grants                                             |   | 447                                                 |   | — |   | — |   | — |   | — |   | 447 |   |
| Loss on redemption of 11.25% Notes                                                  |   | 1,142                                               |   | — |   | — |   | 928 |   | — |   | 2,070 |   |
| Provision for doubtful accounts                                                     |   | —                                              |   | — |   | 814 |   | (214 | ) | — |   | 600 |   |
| Foreign exchange (gain) loss                                                        |   | (1,922                                              | )      | (1,098 | ) | — |   | 1,677 |   | — |   | (1,343 | ) |
| Loss (gain) on sale of assets                                                       |   | —                                              |   | — |   | 33 |   | (34 | ) | — |   | (1 | ) |
| Deferred income taxes                                                               |   | 453                                                 |   | 379 |   | 1,728 |   | (3,638 | ) | — |   | (1,078 | ) |
| Equity in (earnings) loss of subsidiaries                                           |   | (18,610                                             | )      | — |   | — |   | (108 | ) | 18,718 |   | — |   |
| Changes in operating assets and liabilities                                         |   | 2,363                                               |   | 1,805 |   | 37,605 |   | 8,112 |   | — |   | 49,885 |   |
| Net cash (used in) provided by operating  activities                                |   | (1,090                                              | )      | 1,819 |   | 58,281 |   | 17,999 |   | — |   | 77,009 |   |
|                                                                                |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Cash flows from investing activites:                                                |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Proceeds from sale of assets                                                        |   | —                                              |   | — |   | 28 |   | 265 |   | — |   | 293 |   |
| Contributed capital to subsidiaries                                                 |   | (33,201                                             | )      | — |   | — |   | — |   | 33,201 |   | — |   |
| Purchase of businesses                                                              |   | —                                              |   | — |   | (35,256 | ) | — |   | — |   | (35,256 | ) |
| Capital expenditures                                                                |   | —                                              |   | — |   | (2,163 | ) | (2,966 | ) | — |   | (5,129 | ) |
|                                                                                |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Net cash used in investing activities                                               |   | (33,201                                             | )      | — |   | (37,391 | ) | (2,701 | ) | 33,201 |   | (40,092 | ) |
|                                                                                |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Cash flows from financing activities:                                               |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Changes in cash overdrafts                                                          |   | —                                              |   | — |   | (4,477 | ) | — |   | — |   | (4,477 | ) |
| Net (repayments) borrowings on revolving  credit facility                           |   | —                                              |   | — |   | (48,500 | ) | (33,179 | ) | — |   | (81,679 | ) |
| Repayment of long-term debt, including  premium                                     |   | (38,920                                             | )      | — |   | (14 | ) | (99,598 | ) | — |   | (138,532 | ) |
| Issuance of long-term debt                                                          |   | 137,255                                             |   | 62,745 |   | — |   | 34,990 |   | — |   | 234,990 |   |
| Expenses relating to the 2003 Stock  Transaction                                    |   | (3,171                                              | )      | — |   | — |   | — |   | — |   | (3,171 | ) |
| Issuance of common stock from shares held  in treasury                              |   | 354                                                 |   | 21 |   | — |   | — |   | (21 | ) | 354 |   |
| Dividends paid                                                                      |   | —                                              |   | — |   | — |   | — |   | — |   | — |   |
| Deferred financing fees                                                             |   | (6,020                                              | )      | (2,704 | ) | (2,437 | ) | (979 | ) | — |   | (12,140 | ) |
| Purchase of treasury stock                                                          |   | (80                                                 | )      | — |   | — |   | — |   | — |   | (80 | ) |
| Contributed capital from parent                                                     |   | —                                              |   | — |   | 33,180 |   | — |   | (33,180 | ) | — |   |
| Due (to) from affiliates                                                            |   | (55,127                                             | )      | (61,834 | ) | 20,096 |   | 96,865 |   | — |   | — |   |
| Net cash provided by (used in) financing  activities                                |   | 34,291                                              |   | (1,772 | ) | (2,152 | ) | (1,901 | ) | (33,201 | ) | (4,735 | ) |
|                                                                                |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Effect of exchange rate changes on cash                                             |   | —                                              |   | (26 | ) | — |   | 2,406 |   | — |   | 2,380 |   |
|                                                                                |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Net increase in cash and cash equivalents                                           |   | —                                              |   | 21 |   | 18,738 |   | 15,803 |   | — |   | 34,562 |   |
|                                                                                |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Cash and cash equivalents at beginning of  period                                   |   | —                                              |   | — |   | 670 |   | 12,995 |   | — |   | 13,665 |   |
|                                                                                |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Cash and equivalents at end of period                                               |   | $                                                   | — |   | $ | 21 |   | $ | 19,408 |   | $ | 28,798 |   | $ | — |   | $ | 48,227 |   |
|                                                                                |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Supplemental cash flow information:                                                 |   |                                                |   |   |   |   |   |   |   |   |   |   |   |
| Income taxes paid, net                                                              |   | $                                                   | 1,341  |   | $ | — |   | $ | 277 |   | $ | 3,907 |   | $ | — |   | $ | 5,525 |   |
| Interest paid, net                                                                  |   | $                                                   | 1,839  |   | $ | — |   | $ | 627 |   | $ | 4,444 |   | $ | — |   | $ | 6,910 |   |

 

76

----

 
|                                                                                |   | **Predecessor  year ended December 27, 2002**   |   |
|-------------------------------------------------------------------------------------|--------|-------------------------------------------------|--------|
|                                                                                |   | **Euramax  International,  Inc.  (Co-Obligor)** |   | **Euramax  International  Holdings B.V.  (Co-Obligor)** |   | **Guarantor  Subsidiaries** |   | **Non-  Guarantor  Subsidiaries** |   | **Eliminations** |   | **Consolidated  Totals** |   |
| Cash flows from operating activities:                                               |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Net earnings                                                                        |   | $                                               | 19,857 |   | $ | — |   | $ | 18,136 |   | $ | 7,717 |   | $ | (25,853 | ) | $ | 19,857 |   |
| Reconciliation of net earnings to cash  (used in) provided by operating activities: |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization                                                       |   | —                                          |   | — |   | 7,831 |   | 6,137 |   | — |   | 13,968 |   |
| Amortization of deferred finance fees                                               |   | —                                          |   | — |   | 612 |   | 707 |   | — |   | 1,319 |   |
| Provision for doubtful accounts                                                     |   | —                                          |   | — |   | (82 | ) | (95 | ) | — |   | (177 | ) |
| Foreign exchange gain                                                               |   | —                                          |   | — |   | — |   | (796 | ) | — |   | (796 | ) |
| Loss (gain) on sale of assets                                                       |   | —                                          |   | — |   | 585 |   | (33 | ) | — |   | 552 |   |
| Deferred income taxes                                                               |   | 229                                             |   | — |   | 4,356 |   | (311 | ) | — |   | 4,274 |   |
| Dividends received                                                                  |   | —                                          |   | — |   | — |   | 50 |   | (50 | ) | — |   |
| Equity in (earnings) loss of subsidiaries                                           |   | (25,793                                         | )      | — |   | — |   | (60 | ) | 25,853 |   | — |   |
| Changes in operating assets and liabilities                                         |   | (140                                            | )      | — |   | (11,571 | ) | (1,868 | ) | — |   | (13,579 | ) |
| Net cash (used in) provided by operating  activities                                |   | (5,847                                          | )      | — |   | 19,867 |   | 11,448 |   | (50 | ) | 25,418 |   |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Cash flows from investing activites:                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Proceeds from sale of assets                                                        |   | —                                          |   | — |   | 447 |   | 45 |   | — |   | 492 |   |
| Capital expenditures                                                                |   | —                                          |   | — |   | (4,817 | ) | (3,446 | ) | — |   | (8,263 | ) |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Net cash used in investing activities                                               |   | —                                          |   | — |   | (4,370 | ) | (3,401 | ) | — |   | (7,771 | ) |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Cash flows from financing activities:                                               |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Changes in cash overdrafts                                                          |   | —                                          |   | — |   | 461 |   | — |   | — |   | 461 |   |
| Net borrowings (repayments) on revolving  credit facility                           |   | —                                          |   | — |   | 27,200 |   | (3,392 | ) | — |   | 23,808 |   |
| Repayment of long-term debt                                                         |   | —                                          |   | — |   | (33,910 | ) | (5,042 | ) | — |   | (38,952 | ) |
| Proceeds from settlement of currency  agreement                                     |   | —                                          |   | — |   | — |   | 2,790 |   | — |   | 2,790 |   |
| Dividends paid                                                                      |   | —                                          |   | — |   | (50 | ) | — |   | 50 |   | — |   |
| Deferred finance fees                                                               |   | —                                          |   | — |   | (931 | ) | (599 | ) | — |   | (1,530 | ) |
| Purchase of treasury stock                                                          |   | (475                                            | )      | — |   | — |   | — |   | — |   | (475 | ) |
| Due (to) from affiliates                                                            |   | 6,322                                           |   | — |   | (8,055 | ) | 1,733 |   | — |   | — |   |
| Net cash provided by (used in) financing  activities                                |   | 5,847                                           |   | — |   | (15,285 | ) | (4,510 | ) | 50 |   | (13,898 | ) |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Effect of exchange rate changes on cash                                             |   | —                                          |   | — |   | — |   | 2,000 |   | — |   | 2,000 |   |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Net increase in cash and cash equivalents                                           |   | —                                          |   | — |   | 212 |   | 5,537 |   | — |   | 5,749 |   |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Cash and cash equivalents at beginning of  period                                   |   | —                                          |   | — |   | 348 |   | 5,549 |   | — |   | 5,897 |   |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Cash and cash equivalents at end of period                                          |   | $                                               | — |   | $ | — |   | $ | 560 |   | $ | 11,086 |   | $ | — |   | $ | 11,646 |   |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Supplemental cash flow information:                                                 |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Income taxes paid, net                                                              |   | $                                               | 4,354  |   | $ | — |   | $ | 348 |   | $ | 4,769 |   | $ | — |   | $ | 9,471 |   |
| Interest paid, net                                                                  |   | $                                               | 4,187  |   | $ | — |   | $ | 3,107 |   | $ | 13,664 |   | $ | — |   | $ | 20,958 |   |

 

77

----

 
|                                                                                |   | **Predecessor  year ended December 28, 2001**   |   |
|-------------------------------------------------------------------------------------|--------|-------------------------------------------------|--------|
|                                                                                |   | **Euramax  International,  Inc.  (Co-Obligor)** |   | **Euramax  International  Holdings B.V.  (Co-Obligor)** |   | **Guarantor  Subsidiaries** |   | **Non-  Guarantor  Subsidiaries** |   | **Eliminations** |   | **Consolidated  Totals** |   |
| Cash flows from operating activities:                                               |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Net earnings                                                                        |   | $                                               | 4,730  |   | $ | — |   | $ | 4,875 |   | $ | 4,037 |   | $ | (8,912 | ) | $ | 4,730 |   |
| Reconciliation of net earnings to cash  (used in) provided by operating activities: |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization                                                       |   | —                                          |   | — |   | 11,549 |   | 6,006 |   | — |   | 17,555 |   |
| Amortization of deferred finance fees                                               |   | —                                          |   | — |   | 590 |   | 543 |   | — |   | 1,133 |   |
| Provision for doubtful accounts                                                     |   | —                                          |   | — |   | 1,731 |   | 32 |   | — |   | 1,763 |   |
| Foreign exchange loss (gain)                                                        |   | 19                                              |   | — |   | 127 |   | (350 | ) | — |   | (204 | ) |
| Loss (gain) on sale of assets                                                       |   | —                                          |   | — |   | 148 |   | (24 | ) | — |   | 124 |   |
| Deferred income taxes                                                               |   | 33                                              |   | — |   | 71 |   | (75 | ) | — |   | 29 |   |
| Dividends received                                                                  |   | —                                          |   | — |   | — |   | 50 |   | (50 | ) | — |   |
| Equity in (earnings) loss of subsidiaries                                           |   | (9,122                                          | )      | — |   | — |   | 210 |   | 8,912 |   | — |   |
| Changes in operating assets and liabilities                                         |   | 509                                             |   | — |   | 13,839 |   | (3,977 | ) | — |   | 10,371 |   |
| Net cash (used in) provided by operating  activities                                |   | (3,831                                          | )      | — |   | 32,930 |   | 6,452 |   | (50 | ) | 35,501 |   |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Cash flows from investing activites:                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Proceeds from sale of assets                                                        |   | —                                          |   | — |   | 1,119 |   | 45 |   | — |   | 1,164 |   |
| Capital expenditures                                                                |   | —                                          |   | — |   | (4,035 | ) | (4,286 | ) | — |   | (8,321 | ) |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Net cash used in investing activities                                               |   | —                                          |   | — |   | (2,916 | ) | (4,241 | ) | — |   | (7,157 | ) |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Cash flows from financing activities:                                               |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Changes in cash overdrafts                                                          |   | —                                          |   | — |   | (290 | ) | — |   | — |   | (290 | ) |
| Net (repayments) borrowings on revolving credit  facility                           |   | —                                          |   | — |   | (6,300 | ) | 3,526 |   | — |   | (2,774 | ) |
| Repayment of long-term debt                                                         |   | —                                          |   | — |   | (21,358 | ) | (1,631 | ) | — |   | (22,989 | ) |
| Payment to terminate interest rate swap                                             |   | —                                          |   | — |   | (3,160 | ) | — |   | — |   | (3,160 | ) |
| Dividends paid                                                                      |   | —                                          |   | — |   | (50 | ) | — |   | 50 |   | — |   |
| Deferred finance fees                                                               |   | —                                          |   | — |   | (405 | ) | — |   | — |   | (405 | ) |
| Due (to) from affiliates                                                            |   | 3,831                                           |   | — |   | 1,664 |   | (5,495 | ) | — |   | — |   |
| Net cash provided by (used in) financing  activities                                |   | 3,831                                           |   | — |   | (29,899 | ) | (3,600 | ) | 50 |   | (29,618 | ) |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Effect of exchange rate changes on cash                                             |   | —                                          |   | — |   | — |   | (963 | ) | — |   | (963 | ) |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Net increase in cash and cash equivalents                                           |   | —                                          |   | — |   | 115 |   | (2,352 | ) | — |   | (2,237 | ) |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Cash and cash equivalents at beginning of  period                                   |   | —                                          |   | — |   | 233 |   | 7,901 |   | — |   | 8,134 |   |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Cash and cash equivalents at end of period                                          |   | $                                               | — |   | $ | — |   | $ | 348 |   | $ | 5,549 |   | $ | — |   | $ | 5,897 |   |
|                                                                                |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Supplemental cash flow information:                                                 |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
| Income taxes paid, net                                                              |   | $                                               | — |   | $ | — |   | $ | 296 |   | $ | 9,216 |   | $ | — |   | $ | 9,512 |   |
| Interest paid, net                                                                  |   | $                                               | 3,900  |   | $ | — |   | $ | 4,062 |   | $ | 14,428 |   | $ | — |   | $ | 22,390 |   |

 

78

----

 

**Item9.  Changes in and Disagreements withAccountants on Accounting and Financial Disclosures**

 

None

**Part III**

 

# **Item 9A. Controls and Procedures**

 

As of December 26, 2003, based upon an evaluation of the effectivenessof the design and operation of the Company’s disclosure controls andprocedures, the Company’s Chief Executive Officer and the Company’s ChiefFinancial Officer concluded that as of the evaluation date, the Company’sdisclosure controls and procedures (1) are effective in timely alerting them tomaterial information relating to the Company (including its consolidatedsubsidiaries) required to be included in the Company’s reports that if files orsubmits under the Securities and Exchange Act of 1934 (the “Exchange Act”) and(2) are adequate to ensure that information required to be disclosed by theCompany in the reports filed or submitted by the Company under the Exchange Actis recorded, processed and summarized and reported within the time periodsspecified in the SEC’s rules and forms. Further, there were no changes in theCompany’s internal controls over financial reporting identified in connectionwith that evaluation that occurred during the quarter ended December 26, 2003,that have materially affected or would be reasonably likely to materiallyaffect the Company’s internal control over financial reporting.

 

**Item10.  Directors, Executive Officers andKey Management**

 

The following sets forth certain information with respect to thepersons who are members of our Board of Directors, our executive officers andkey management employees of our company and our subsidiaries.

 
| **Name**                 |   | **Age** |   | **Position**                                                          |   |
|--------------------------|--------|---------|--------|-----------------------------------------------------------------------|--------|
| J. David Smith           |   | 55      |   | Chief  Executive Officer, President and Chairman of the Board         |   |
|                     |   |    |   |                                                                  |   |
| Mitchell B. Lewis        |   | 41      |   | Executive  Vice President and Corporate Business Development Director |   |
|                     |   |    |   |                                                                  |   |
| R. Scott Vansant         |   | 41      |   | Vice  President, Secretary and Chief Financial Officer                |   |
|                     |   |    |   |                                                                  |   |
| Scott R. Anderson        |   | 41      |   | President -  Amerimax Building Products, Inc.                         |   |
|                     |   |    |   |                                                                  |   |
| Dudley Rowe              |   | 45      |   | President -  Amerimax Home Products, Inc.                             |   |
|                     |   |    |   |                                                                  |   |
| Rob Dresen               |   | 49      |   | Managing  Director - Euramax Coated Products B.V.                     |   |
|                     |   |    |   |                                                                  |   |
| David C. Pugh            |   | 54      |   | Managing Director  - Ellbee Limited                                   |   |
|                     |   |    |   |                                                                  |   |
| Aloyse Wagener           |   | 56      |   | Managing  Director - Euramax Industries S.A.                          |   |
|                     |   |    |   |                                                                  |   |
| Nick E. Dowd             |   | 46      |   | President -  Fabral, Inc.                                             |   |
|                     |   |    |   |                                                                  |   |
| Gerald Williams          |   | 48      |   | Managing  Director - Euramax Coated Products Limited                  |   |
|                     |   |    |   |                                                                  |   |
| Stuart M. Wallis         |   | 58      |   | Director                                                              |   |
|                     |   |    |   |                                                                  |   |
| Joseph M. Silvestri      |   | 42      |   | Director                                                              |   |
|                     |   |    |   |                                                                  |   |
| Richard E. Mayberry, Jr. |   | 50      |   | Director                                                              |   |
|                     |   |    |   |                                                                  |   |
| Paul E. Drack            |   | 76      |   | Director                                                              |   |
|                     |   |    |   |                                                                  |   |
| Thomas F. McWilliams     |   | 60      |   | Director                                                              |   |

** **

**J.David Smith** has been Chief Executive Officer and aDirector of our company since September 1996. In March 2002, Mr. Smith wasnamed Chairman of the Board of Directors. Mr. Smith’s career in thefabricated products industry spans thirty-two years, starting with variousoperational responsibilities with Howmet Aluminum Corp. In 1983, throughAlumax’s acquisition of Howmet, Mr. Smith became Alumax’s VicePresident and General Manager of the Building Specialties Division and becamePresident of Alumax Home and Specialty Products Group in 1988.  Mr. Smith became President of AlumaxFabricated Products in 1990 and was appointed a Vice President of Alumax in1994.

 

**Mitchell B. Lewis**becameExecutive Vice President of our company in October 1998, Corporate DevelopmentDirector in June 1998 and served as Group Vice President of Amerimax BuildingProducts, Inc. and Fabral, Inc. since 1997. Prior to being appointed Group VicePresident, he was President and General Manager of Amerimax Building Products,Inc. from 1993 to 1997 and Assistant General Manager

 

79

----

 

of Amerimax Building Products,Inc. from 1991 to 1993. Prior to 1991, Mr. Lewis served as corporatecounsel with Alumax, and, prior to joining Alumax, he practiced law,specializing in mergers and acquisitions.

 

**R.Scott Vansant**became Chief Financial Officer of ourcompany in July 1998 and Vice President and Secretary in September 1996. He****joinedAlumax in 1991. From 1995 to 1996, Mr. Vansant served as Director ofInternal Audit for Alumax. Mr. Vansant also served in various operationalpositions with Alumax Building Products, Inc., including serving asController of the division from 1993 to 1995. Prior to 1991, Mr. Vansantworked as a Certified Public Accountant for Ernst & Young LLP.

 

**ScottR. Anderson**became President of our subsidiaryAmerimax Building Products, Inc. in October 1998. Mr. Anderson has served invarious financial and operational roles since joining our company in 1987,including Operations Manager (1997 to 1998) and Controller (1995 to 1997) ofAmerimax Building Products, Inc.

 

**DudleyRowe**became President of our subsidiary Amerimax HomeProducts, Inc. in October 1999. Mr. Rowe has served in various sales andoperational roles since joining our company in October 1980, including SalesManager of Amerimax Home Products, Inc. from 1988 to 1999.

 

**RobDresen**became managing Director of our subsidiaryEuramax Coated Products B.V. in January 2001. Mr. Dresen joined Euramax CoatedProducts BV in 1993 as Sales and Marketing Director. Prior to joining EuramaxCoated Products B.V., Mr. Dresen spent 14 years in sales and marketingmanagement for such international companies as Stork Screens International andAkrosit Europe.

 

**DavidC. Pugh**has been Managing Director of our subsidiaryEllbee Limited since 1996. Prior to the acquisition of Alumax’s fabricatedproducts division, Mr. Pugh held several positions with Alumax, includingSales Director and Production Director of Ellbee Limited.

 

**AloyseR. Wagener** joined our subsidiary Euramax IndustriesS.A. in July 1992 as Managing Director. From 1989 to 1992, Mr. Wagener wasManaging Director of Para-Press in Luxembourg. Prior to 1989, Mr. Wagener heldseveral positions with Para-Press, including Purchasing Director and SalesDirector.

 

**NickE. Dowd**became President of our subsidiary Fabral,Inc. in July 2000. Mr. Dowd served as Controller of our subsidiary AmerimaxBuilding Products, Inc. from 1998 to 2000. Prior to 1998, Mr. Dowd served asDivisional President and General Manager for Waste Management, Inc.

 

**GeraldWilliams**became Managing Director of our subsidiaryEuramax Coated Products Limited in September 2002. Mr. Williams joined EuramaxCoated Products Limited in October 1986 as Technical Manager. From 1991 to2002, Mr. Williams held several positions, including Technical Director andOperations Director. Prior to 1986, Mr. Williams held the position of TechnicalSuperintendent with British Steel.

 

**StuartM. Wallis**became a director of our company andnon-executive chairman of the Board of Directors in February 1997. Mr. Wallisstepped down as non-executive chairman in March 2002. Mr. Wallis served asChief Executive for Fisons plc from 1994 to 1995 and is currently Chairman ofProtherics plc, in addition to a number of private companies.

 

**JosephM. Silvestri**became a director of our company uponconsummation of the acquisition of Alumax’s fabricated products division in1996.  Mr. Silvestri is a partnerof Citigoup Venture Capital, where he has been employed

 

80

----

 

since 1990. Mr. Silvestriis a director of MacDermid, Triumph Group and Worldspan, L.P.

 

**RichardE. Mayberry, Jr.** became a director of our company inJanuary 2002. Mr. Mayberry has been employed by Citigroup Venture Capital since1984 and has been a managing director of Citicorp Capital Investors, Ltd. since1994. Mr. Mayberry is a director of a number of private companies.

 

**PaulE. Drack**became a director of our company in December1996. Mr. Drack retired from AMAX Inc. in December 1993 after serving asPresident and Chief Operating Officer from 1991. From 1985 to 1991,Mr. Drack was employed in various positions with Alumax Inc. serving asPresident and Chief Executive Officer from 1986 to 1991. Mr. Drack serves as adirector of Miller Industries, Inc.

 

**ThomasF. McWilliams** became a director of our company in June2003. Since 1983, Mr. McWilliams has been affiliated with Citigroup VentureCapital and has served as vice president and a managing partner of CitigroupVenture Capital as well as a member of its investment committee. Mr. McWilliamsalso serves as a director of each of MMI Products, Inc., Royster-Clark, Inc.,Ergo Science Corporation, Strategic Industries, Inc., and Polar Corporation.

 

**Audit Committee Financial Expert**

 

The Board of Directors of theCompany acts in the capacity of an audit committee.  The Board of Directors has determined that it does not have an“audit committee financial expert” as that term is defined in the Securitiesand Exchange Commission rules and regulations. However, the Board of Directorsbelieves that its members have demonstrated the capability of analyzing andevaluating the Company’s financial statements and understanding internalcontrols and procedures for financial reporting.  As the Board of Directors believes that its current members arecollectively qualified to carry out all of the duties and responsibilities ofthe Board of Directors acting in the capacity of an audit committee, the Boarddoes not believe that it is necessary at this time to actively search for anoutside person to serve on the Board of Directors who would qualify as an auditcommittee financial expert.

 

**Codeof Ethics**

 

The Board of Directors has not,as yet, adopted a code of ethics applicable to the Company’s principalexecutive officer, principal financial officer, principal accounting officer orcontroller, or for persons performing similar functions. The Board of Directorsbelieves that the Company’s existing internal control procedures and currentbusiness practices are adequate to promote honest and ethical conduct and todeter wrongdoing on the part of these executives.  The Company expects to implement during 2004 a code of ethicsthat will apply to these executives.  Inaccordance with applicable SEC rules, the code of ethics will be made publiclyavailable.

 

**Item11.  Executive Compensation**

 

The following table summarizes the compensation paid or accrued forfiscal years 2003, 2002 and 2001 to our chief executive officer and ourexecutive officers earning in excess of $100,000 during fiscal year 2003 (eachsuch person being referred to as a “named executive officer”).

 

**Summary Compensation Table**

 
|                                                                                     |   |     |    | **Annual  Compensation** |    | **Long-Term  Compensation** |   |                              |   |
|------------------------------------------------------------------------------------------|--------|----------|---------|--------------------------|---------|-----------------------------|--------|-----------------------------------|--------|
| **Name and Principal Position**                                                          |   | **Year** |    | **Salary**               |    | **Bonus**                   |   | **Restricted  Stock  Awards (3)** |   | **All Other  Compensation (1)(2)** |   |
|                                                                                     |   |     |    |                     |    |                        |   |                              |   |   |   |
| J. David Smith, Chief Executive Officer,  President and Director                         |   | 2003     |    | $                        | 490,625 |                        | $      | 1,030,580                         |   | $ | 1,352,240 |   | $ | 30,093 |   |
|                                                                                     | 2002   |     | 431,250 |                     | 409,312 |                        | — |                              | 28,599 |   |
|                                                                                     | 2001   |     | 395,000 |                     | 304,059 |                        | — |                              | 25,809 |   |
|                                                                                     |   |     |    |                     |    |                        |   |                              |   |   |   |
| Mitchell B. Lewis, Executive Vice President  and Corporate Business Development Director |   | 2003     |    | 281,667                  |    | 553,202                     |   | 816,400                           |   | 12,540 |   |
|                                                                                     | 2002   |     | 245,000 |                     | 182,901 |                        | — |                              | 12,022 |   |
|                                                                                     | 2001   |     | 226,500 |                     | 139,453 |                        | — |                              | 10,635 |   |
|                                                                                     |   |     |    |                     |    |                        |   |                              |   |   |   |
| R. Scott Vansant, Vice President, Secretary  and Chief Financial Officer                 |   | 2003     |    | 235,333                  |    | 461,002                     |   | 816,400                           |   | 12,505 |   |
|                                                                                     | 2002   |     | 206,000 |                     | 153,786 |                        | — |                              | 11,934 |   |
|                                                                                     | 2001   |     | 189,250 |                     | 116,519 |                        | — |                              | 10,555 |   |
|                                                                                          |        |          |         |                          |         |                             |        |                                   |        |  |  |  |  |  |  |

 

----

(1)                                  Excludes certain perquisites received which donot exceed the lessor of $50,000 or ten percent of any named executiveofficer’s salary and bonus.

 

81

----

 

(2)                                  All other compensation for 2003 consists ofthe Company’s matching contributions to the defined contribution plan, termlife insurance and discretionary Company contributions to the definedcontribution plan based on age and years of service: J. David Smith earned$12,093 for term life insurance and $18,000 for the defined contribution plan;Mitchell B. Lewis earned $540 for term life insurance and $12,000 for thedefined contribution plan; R. Scott Vansant earned $505 for term life insuranceand $12,000 for the defined contribution plan.

 

(3)                                  There were no restricted stock awardsoutstanding at the end of fiscal 2002.

 

**2003Equity Compensation Plan**

 

We have established an equity compensation program, the EuramaxInternational, Inc. 2003 Equity Compensation Plan, or the 2003 Equity Plan, forthe purposes of attracting and retaining valued employees. The 2003 Equity Planseeks to accomplish these goals by offering certain management employees agreater stake in our success, and to encourage ownership of our stock by theseemployees. Under the 2003 Equity Plan, we have granted restricted shares of ourClass A common stock to selected officers or other key employees. We havereserved 35,719.6 shares of Class A common stock for issuance under the 2003Equity Plan. In connection with the 2003 Stock Transaction, we granted 9,569.6shares of restricted Class A common stock and 25,750 options to purchase sharesof our Class A common stock. See “Item 13. Certain Relationships and RelatedTransactions—2003 Stock Transaction” for more information.

 

The 2003 Equity Plan is administered by a committee designated by ourboard of directors, which shall have at least two members, each of whom shallbe a “non-employee director” as defined in Rule 16b-3 under the SecuritiesExchange Act of 1934, or the Exchange Act, and an “outside director” as definedin Section 162(m) of the Internal Revenue Code of 1986, or the Code. Thecommittee has full authority to act in selecting the eligible employees to whomawards of options or restricted stock may be granted. The committee willdetermine the times at which such awards of options or restricted stock may begranted, the time and matter in which options may be exercised, the type andamount of award that may be granted, the terms and conditions of awards thatmay be granted under the 2003 Equity Plan and the terms of agreements whichwill be entered into with employees designated to participate in the 2003Equity Plan. However, in no event may the exercise price of any non-qualifiedoptions granted under the 2003 Equity Plan be less than the fair market valueof the underlying shares on the grant date.

 

The 2003 Equity Plan permits the committee to grant both incentivestock options and non-qualified stock options, but all 25,750 options grantedas of the date hereof are non-qualified stock options. The committee maydetermine the number of options granted to each participant, the exercise priceof each option, the duration of the options (not to exceed ten years), vestingprovisions and all other terms and conditions of such options in individualoption agreements. The non-qualified stock option grant agreements in effect onthe date hereof provide that each participant will vest in 20% of the sharessubject to the option grant on each anniversary of the date of grant, untilbecoming 100% vested after 5 years. Non-qualified stock option grant agreementsunder the 2003 Equity Plan provide that upon termination of employment with us,the exercise period for vested options will generally be limited, except thatvested options will be canceled immediately upon a termination for cause. Thenon-qualified stock option grant agreements provide for the cancellation of allunvested options upon termination of employment with us. Under the 2003 EquityPlan, if any options shares subject to an outstanding option grant areforfeited or if the option grant otherwise terminates without exercise, any ofthese forfeited or terminated option grant shares may be reissued at thediscretion of the committee.

 

The 2003 Equity Plan also permits us to grant participants restrictedshares of our Class A common stock. The committee will determine the number ofshares of restricted stock granted to each participant, the period therestricted stock is unvested and subject to forfeiture and all other terms andconditions applicable to such restricted stock in individual restricted stock agreements.The restricted stock agreements in effect on the

 

82

----

 

date hereof provide that the participant will vest in 100% of therestricted shares five years from the date of grant. If an employee voluntarilyterminates his or her employment, the employee will forfeit any unvested sharesof restricted stock. If employment is terminated for any reason other thanvoluntary termination, all unvested shares of the restricted stock shall beaccelerated as of the date of the non-voluntary termination. All shares ofrestricted stock granted, and all shares acquired upon exercise of optionsgranted, under the 2003 Equity Plan will be subject to the stockholdersagreement described under “Item 13. Certain Relationships and Related PartyTransactions—Stockholders Agreement.”

 

The 2003 Equity Plan provides that upon a change in control of ourcompany, all restricted stock awards shall become fully vested, and eachunexercised and outstanding option shall become immediately and fully vestedand exercisable. All restricted stock awards shall also become fully vested inthe event of an initial public offering of our common stock. Each option thatis exercisable immediately prior to the change in control may be canceled in exchangefor a payment in cash of an amount equal to the excess of the fair market valueof the common stock underlying the option as of the date of the change incontrol over the exercise price. The committee may also decide that suchoptions be terminated immediately prior to the change in control, provided thatthe participant fails to exercise the option within a specified period (of atleast seven days) following receipt of written notice of the change in controland of our intention to terminate the option prior to such change in control.Alternatively, the committee may determine that in the event of a change incontrol, such options shall be assumed by the successor corporation, and shallbe substituted with options involving the common stock of the successorcorporation with equivalent value and with the terms and conditions of thesubstituted options being no less favorable than the options granted by us.

 

**EquityCompensation Plan Information**

** **
| **Plan  category**                                          |   | **Number of  securities  to be issued upon  exercise of  outstanding options,  warrants and rights** |   | **Weighted-average  exercise price of  outstanding options,  warrants and rights** |   | **Number of  securities  remaining available for  future issuance under  equity compensation  plans (excluding  securities reflected in  column (a))** |   |
|-------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                        |   | **(a)**                                                                                              |   | **(b)**                                                                            |   | **(c)**                                                                                                                                                |   |
|                                                        |   |                                                                                                 |   |                                                                               |   |                                                                                                                                                   |   |
| Equity compensation plans approved by  security holders     |   | —                                                                                               |   | $                                                                                  | — |                                                                                                                                                   | — |   |
|                                                        |   |                                                                                                 |   |                                                                               |   |                                                                                                                                                   |   |   |
| Equity compensation plans not approved by  security holders |   | 35,719.6                                                                                             |   | $                                                                                  | 400.00 |                                                                                                                                                   | 400.0  |   |
|                                                        |   |                                                                                                 |   |                                                                               |   |                                                                                                                                                   |   |
| Total                                                       |   | 35,719.6                                                                                             |   | $                                                                                  | 400.00 |                                                                                                                                                   | 400.0  |   |

 

**PensionPlans**

 

We sponsor a defined benefit plan, the Amerimax Companies RetirementIncome Plan, or Retirement Plan, which is intended to qualify under section 401of the Code. The Retirement Plan covers certain U.S. hourly employees on theiremployment commencement date. The benefits under this plan are based primarilyon a benefit rate multiplied by a participant’s years of service.

 

The Retirement Plan provides normal retirement benefits at age 65generally determined by multiplying the applicable benefit rate by theparticipant’s years of service. Benefit rates are determined from theapplicable appendix of the plan pertaining to specific employee groups.

 

Generally, with a few exceptions, an employee who has reached age 60with five years of service may elect to retire early with reduced benefits. Thenormal form of benefit under the Retirement Plan for an unmarried participantis a single life annuity and for a married participant is a joint and 50%survivor annuity. Other optional forms of benefit, which provide foractuarially reduced pensions, are also available. Under U.S. federal law for2003, benefits from the Retirement Plan are limited to $160,000 per year.

 

As of December 26, 2003, the fair market value of the Retirement Plan’sassets was approximately $2.8 million. Both the plan’s FAS 87 accumulatedbenefit obligation, or ABO, and its projected benefit obligation, or PBO, wasapproximately $3.5 million. Accordingly, the Retirement Plan’s PBO exceeded itsassets by approximately $0.7 million.

 

**EuramaxU.K. Pension Plan**

 

We sponsor a foreign defined benefit pension plan, the Euramax U.K.Pension Plan, or U.K. Plan, which is contracted out of the State EarningsRelated Pension Scheme on a final salary basis and is approved under Chapter I ofPart XIV of the Income and Corporation Taxes Act of 1988. The U.K. Plan coverssubstantially

 

83

----

 

all of our employees located inthe United Kingdom. The benefits under this plan are based primarily on thehighest annual average of pensionable salary during any continuous three yearperiod during the ten years prior to normal retirement.

 

The U.K. Plan provides normal retirement benefits at age 65 equal toone-sixtieth of final pensionable earnings for each year of pensionableservice. Members contribute at the rate of 4% of their pensionable salaries andwe are responsible for the balance of the cost of providing benefits from theplan.

 

As of December 26, 2003, the fair market value of the U.K. Plan’s assetswas approximately $17.1 million. The plan’s PBO and ABO were approximately$29.4 million and $27.5 million, respectively. Accordingly, the U.K. Plan’s PBO exceeded it assets by approximately$12.3 million.

 

**401(k)Plans**

 

We maintain a non-contributory defined benefit pension plan that coverssubstantially all of our U.S. hourly employees. We also maintain three definedcontribution retirement and savings plans, which allow our employees tocontribute a percentage of their pre-tax and/or after-tax income in accordancewith specified guidelines. We match a certain percentage of employee pre-taxcontributions up to certain limits. Further, the plans provide fordiscretionary contributions by us based on our employees’ years of service withus and their age. Our expenses for the three years ended December 26, 2003,December 27, 2002, and December 28, 2001, were approximately $1.7 million, $1.5million and $1.5 million, respectively.

 

**PhantomStock Plan**

 

We sponsor a phantom stock plan, the Euramax International, Inc. 1999Phantom Stock Plan, under which key executives or other management employeeswere granted one-time awards of phantom shares. A phantom share is a unit equalto 4% of the equity value of Euramax International, as defined by the plan,divided by 40,000 (the maximum number of phantom shares that may be awarded toparticipants under the plan). A phantom share entitles the participant toreceive compensation equal to the value of a phantom share on December 31,2003, minus the value of a phantom share at the date of grant, all as definedby the plan. On January 1, 1999, 36,000 of the phantom shares were granted, ofwhich 26,547 shares and 31,385 shares remain outstanding as of December 26,2003 and December 27, 2002, respectively. No additional grants of shares willbe made under the Plan. The value of the awards became fixed on December 31,2003. Compensation will be paid out in four equal payments during the firstquarter of 2004 through 2007, unless there is a change in control, a publicoffering of our common stock, or the death or disability of the participant.Participants that are not employees of the Company on the date compensation ispaid out will forfeit their compensation.

 

**IncentiveCompensation Plan**

 

We sponsor an incentive compensation plan, the Euramax IncentiveCompensation Plan, which provides benefits to our executive officers and keyemployees. Under the terms of our incentive compensation plan, we establishannual performance objectives for each participant and a target award uponachievement of performance objectives. The performance objectives are generallybased on a formula that incorporates our EBITDA (as defined in the plan) andreturn on average net assets, each as determined in accordance with the plan,and target awards are based on a percentage of each participant’s base salary.Annual awards are generally paid as soon as practicable after our determinationof the achievement of performance objectives. In the event of a change ofcontrol of our company, we must pay a pro-rata portion of each participant’sfull target award for the year in which the change of control occurs.

 

84

----

 

**EmploymentAgreements and Arrangements**

 

*J. David Smith.*We entered into an employmentagreement with Mr. Smith on October 1, 1999, which provides for Mr. Smith toserve as our President and Chief Executive Officer for an initial two yearterm, automatically extended each day thereafter unless we give sixty days’prior written notice of our election not to extend Mr. Smith’s employment. Inconnection with the 2003 Stock Transaction, we entered into an amendment to Mr.Smith’s employment agreement that provides, among other things, for Mr. Smithto serve as Chairman of our board of directors as well as our President andChief Executive Officer. Under the amended employment agreement, Mr. Smithreceives a base salary of $525,000 per annum, subject to increases at thediscretion of our board of directors. The amended employment agreement alsoestablishes for Mr. Smith a target annual bonus of 60% of his base salary. Theamended employment agreement also provided for a cash sale bonus payment of$656,250 in connection with the 2003 Stock Transaction.

 

During his employment term, Mr. Smith is eligible to participate in allbenefit programs in which all senior executive employees of our company areeligible to participate, including at a minimum basic and supplemental lifeinsurance in total equal to 41⁄2 times base salary, accidental death anddismemberment insurance equal to 41⁄2 times base salary and long-term disabilityinsurance equal to 2/3 the amount of Mr. Smith’s base salary and target bonus.Subject to certain exceptions, including termination for cause or terminationin connection with a change of control of our company as described below, inthe event we terminate Mr. Smith’s employment he will be entitled to receivemonthly severance payments for a period of 24 months equal to the monthlyportion of Mr. Smith’s annualized salary, target bonus and the annualizeddollar value of his other benefits in effect on the date of termination.

 

Under the terms of Mr. Smith’s amended employment agreement, if thereis a change of control of our company and Mr. Smith’s employment is terminatedwithout cause or he suffers a constructive termination within 12 months afterthe effective date of the change of control, Mr. Smith will be entitled toreceive a payment equal to three times Mr. Smith’s average total annualcompensation for the five calendar years immediately preceding the effectivedate of his employment termination. The amendment to Mr. Smith’s employmentagreement eliminates any requirements to reduce the foregoing payment by anyother “parachute payments” (within the meaning of section 280G of the Code) wemake to Mr. Smith, including the acceleration of vesting of any restrictedstock or stock options. If there is a change in control and Mr. Smith resignshis employment with us for any reason (other than in anticipation of histermination for cause) within 12 months after the effective date of the changeof control, then Mr. Smith will be entitled to receive a payment equal to histotal annual compensation as in effect at the date of the change of control,including base salary, the value of the benefits received by Mr. Smith as partof his relationship with us, plus the amount of his full target bonus for theyear in which the change of control occurs. This amount is payable in a singlepayment within 30 days after the effective date of Mr. Smith’s resignation.

 

Mr. Smith’s amended employment agreement also contains anon-competition provision as well as a non-solicitation provision lasting forso long as he is entitled to receive severance payments or for two years if hevoluntarily resigns, in addition to confidentiality covenants. In addition, hisamended employment agreement provides that during the two year period from histermination date, we will provide Mr. Smith and his qualified beneficiariescontinued coverage under all of our insurance plans, including medicalinsurance and other health plans, life insurance and disability insurance plansin which Mr. Smith or his qualified beneficiaries were a participantimmediately prior to the date of termination, subject to a timely payment byMr. Smith of all required premiums and other co-payments.

 

*Mitchell B. Lewis.* In connection with the 2003Stock Transaction, we entered into a letter agreement with Mr. Lewis,establishing a base salary for Mr. Lewis of $300,000 per year. The letteragreement also establishes a target annual bonus for Mr. Lewis of 50% of hisbase salary. The letter agreement also provided for a cash sale bonus paymentof $375,000 in connection with the 2003 Stock Transaction. The letter agreementis not an employment agreement and does not give Mr. Lewis rights to continued

 

85

----

 

employment.

 

Under the terms of a letter agreement we entered into with Mr. Lewis onDecember 1, 1999, if there is a change of control of our company and Mr. Lewis’employment is terminated without cause or he suffers a constructive terminationwithin 12 months after the effective date of the change of control, Mr. Lewiswill be entitled to receive a payment equal to two times Mr. Lewis’ averagetotal annual compensation for the five calendar years immediately preceding theeffective date of his employment termination. This amount is payable in asingle payment within 30 days after the date of his termination. The letteragreement is not an employment agreement and does not give Mr. Lewis rights tocontinued employment.

 

*R. Scott Vansant.*In connection with the 2003Stock Transaction, we entered into a letter agreement with Mr. Vansant,establishing a base salary for Mr. Vansant of $250,000 per year. The letteragreement also establishes a target annual bonus for Mr. Vansant of 50% of hisbase salary. The letter agreement also provided for a cash sale bonus paymentof $312,500 in connection with the 2003 Stock Transaction. The letter agreementis not an employment agreement and does not give Mr. Vansant rights tocontinued employment.

 

Under the terms of a letter agreement we entered into with Mr. Vansanton December 1, 1999, if there is a change of control of our company and Mr.Vansant’s employment is terminated without cause or he suffers a constructivetermination within 12 months after the effective date of the change of control,Mr. Vansant will be entitled to receive a payment equal to two times Mr.Vansant’s average total annual compensation for the five calendar years immediatelypreceding the effective date of his employment termination. This amount ispayable in a single payment within 30 days after the date of his termination.The letter agreement is not an employment agreement and does not give Mr.Vansant rights to continued employment.

 

**SupplementalExecutive Retirement Plan Agreements**

 

We entered into two Supplemental Executive Retirement Plans, or SERPAgreements, effective on June 12, 2003, one with Mr. Smith and one benefitingMessrs. Lewis and Vansant. The SERP Agreement for Mr. Smith provides a benefitof $190,000 per year, payable as a life annuity, beginning at age 62. Mr. Smithis currently 55 years old and is 100% vested in his SERP benefit. Mr. Smith’sbenefit becomes payable upon the earliest to occur of his retirement, his totaland permanent disability, his death or a change in control of our company,provided that if his benefit becomes payable before he attains age 60, it willbe subject to a reduction factor, based on his then attained age. Mr. Smith mayelect to receive his benefits in the form of a

 

86

----

 

lump sum or life annuity as long as his election is made at least 120days prior to the receipt of any benefits paid under the SERP Agreement.

 

The SERP Agreement benefiting Messrs. Lewis and Vansant provides abenefit of $46,000 per year, payable as a life annuity, beginning at age 65 foreach of Messrs. Lewis and Vansant. Mr. Lewis and Mr. Vansant are both currently41 years old. In each case, their benefits will vest upon the earliest of theirattainment of age 55, their death, total and permanent disability or upon achange in control of our company. Mr. Lewis’ and Mr. Vansant’s benefits becomepayable upon the earliest to occur of their retirement, total and permanentdisability, death or a change of control of our company, except that if theirbenefits become payable before they attain age 65, only a specified percentageof the benefit amount will be payable. That percentage increases from 50% at age55 to 96% at age 64. Messrs. Lewis and Vansant may elect to receive theirbenefits in the form of a lump sum or life annuity as long as their election ismade at least 120 days prior to the receipt of any benefits paid under the SERPAgreement.

 

**Compensationof Directors**

 

Beginning April 1, 2002, non-executive directors are paid an annual feeof $25,000. Additionally, directors are reimbursed for out-of-pocket expensesincurred in connection with attending meetings. Prior to April 1, 2002, Mr.Drack was paid an annual fee of $24,000 and Mr. Wallis was paid an annual feeof British Pounds 43,333.

 

**CompensationCommittee Interlocks and Insider Participation**

 

Our compensation committee is composed of Messrs. Drack, Silvestri, andWallis. Mr. Rolly van Rappard, who resigned from our board of directors in June2003, also served on our compensation committee during 2003. None of thesedirectors are currently or have been, at any time since our formation, one ofour officers or employees. None of our executive officers currently serve, orin the past have served, as a member of the board of directors or compensationcommittee of any entity that has one or more executive officers serving on ourboard of directors.

 

**Item12.  Security Ownership of CertainBeneficial Owners and Management**

 

The following table sets forth certain information as of March 15, 2004regarding the beneficial ownership of Euramax International common stock byeach person or entity known to us to own more than 5% of the outstanding sharesof Euramax International common stock, each member of our board of directorsand each of our named executive officers and all of the members of our board ofdirectors and our executive officers as a group. Except as set forth below, toour knowledge the stockholders listed below have sole voting and investmentpower as to the shares of stock shown as beneficially owned by them. Beneficialownership of the shares of stock listed in the table has been determined inaccordance with the applicable rules and regulation promulgated under theExchange Act. The information contained in this table does not give effect tothe anticipated repurchase by us of all of our stock held by Court Square. Ifsuch repurchase is completed, then CVCEP will own approximately 81% of our outstandingcommon stock.

 

87

----

 
|                                                    |   | **Number and  Percent of Shares of  Euramax International (1)** |   |
|---------------------------------------------------------|--------|-----------------------------------------------------------------|--------|
|                                                    |   | **Class A Common Stock**                                        |   |
|                                                    |   | **Number**                                                      |   | **Percent** |   |
| **Greater than 5% Stockholders:**                       |   |                                                            |   |   |   |
|                                                    |   |                                                            |   |   |   |
| Citigroup Venture Capital Equity Partners, L.P. (2)     |   | 265,762.48                                                      |   | 54.0 | % |
| 399 Park Avenue, 14th Floor                             |   |                                                            |   |   |   |
| New York, NY 10043                                      |   |                                                            |   |   |   |
|                                                    |   |                                                            |   |   |   |
| Court Square Capital Limited (3)                        |   | 169,680.62                                                      |   | 34.5 | % |
| 399 Park Avenue, 14th Floor                             |   |                                                            |   |   |   |
| New York, NY  10043                                |   |                                                            |   |   |   |
|                                                    |   |                                                            |   |   |   |
| **Named Executive Officers and Directors:**             |   |                                                            |   |   |   |
|                                                    |   |                                                            |   |   |   |
| J. David Smith (4)                                      |   | 8,815.25                                                        |   | 1.8 | % |
| Mitchell B. Lewis (4)                                   |   | 6,702.35                                                        |   | 1.4 | % |
| R. Scott Vansant (4)                                    |   | 4,485.95                                                        |   |   | * |
| Joseph M. Silvestri (5)                                 |   | 439,775.12                                                      |   | 89.3 | % |
| Richard E. Mayberry (5)                                 |   | 435,642.60                                                      |   | 88.5 | % |
| Paul E. Drack (6)                                       |   | 779.87                                                          |   |   | * |
| Stuart M. Wallis (7)                                    |   | 4,668.82                                                        |   |   | * |
| Thomas F. McWilliams (5)(8)                             |   | 435,688.47                                                      |   | 88.5 | % |
| Executive Officers and Directors as a Group (8 persons) |   | 465,426.86                                                      |   | 94.5 | % |

 

----

* Less than 1%

(1)          Pursuant to Rule 13d-3under the Securities Exchange Act of 1934, as amended, a person has beneficialownership of any securities as to which such person, directly or indirectly,through any contract, arrangement, undertaking, relationship or otherwise hasor shares voting power and/or investment power and as to which such person hasthe right to acquire such voting and/or investment power within 60 days.Percentage of beneficial ownership as to any person as of a particular date iscalculated by dividing the number of shares beneficially owned by such personby the sum of the number of shares outstanding as of such date and the numberof shares as to which such person has the right to acquire voting and/orinvestment power within 60 days.

(2)          Includes 260,850.60shares of Class A common stock held by Citigroup Equity Partners, L.P.,2,597.50 shares of Class A common stock held by CVC/SSB Employee Fund, L.P. and2,314.38 shares of Class A common stock held by CVC Executive Fund LLC. Doesnot include 169,680.62 shares of Class A common stock owned by Court SquareCapital Limited, an affiliate of CVCEP. CVCEP disclaims beneficial ownership ofthese shares owned by Court Square Capital Limited.

(3)          Does not include265,762.48 shares of Class A common stock beneficially owned by CVCEP, anaffiliate of Court Square Capital Limited. Court Square Capital Limiteddisclaims beneficial ownership of these shares beneficially owned by CVCEP.

(4)          The address of each of Mr. Smith, Mr. Lewis and Mr. Vansant is c/oEuramax International, Inc., 5445 Triangle Parkway, Suite 350, Norcross,Georgia 30092.

(5)          Includes 265,762.48 shares of Class A common stock beneficially owned byCVCEP and 169,680.62 shares of Class A common stock owned by Court SquareCapital Limited. Each of Mr. Silvestri, Mr. Mayberry and Mr. McWilliams is amember of management of CVCEP and Court Square Capital Limited. Each disclaimsbeneficial ownership of the shares owned by CVCEP and Court Square CapitalLimited. The address of each of Mr. Silvestri, Mr. Mayberry and Mr. McWilliamsis c/o Citigroup Venture Capital Equity Partners, L.P., 399 Park Avenue, 14thFloor, New York, NY  10022.

(6)          The address of Mr. Drack is c/o Euramax International, Inc., 5445Triangle Parkway, Suite 350, Norcross, Georgia 30092.

(7)          The address of Mr. Wallis is c/o Protherics plc, 4th Floor, 3Creed Court, 5 Ludgate Hill, London EC4M 7AA

(8)          Includes 245.37 shares of Class A common stock owned by the Thomas F.McWilliams Flint Trust, a trust which may be deemed to be beneficially owned byMr. McWilliams. Mr. McWilliams disclaims beneficial ownership of the sharesowned by the Thomas F. McWilliams Flint Trust.

 

**Item13.  Certain Relationships and RelatedTransactions**

 

**2003Stock Transaction**

TheCompany entered into a stock purchase agreement on April 15, 2003, with CVCEP,certain affiliates of CVCEP, CVC Europe, BNP Paribas and certain otherstockholders. Pursuant to the stock purchase agreement, on June 12, 2003, CVCEPand its affiliates acquired from the Company’s former stockholders,

 

88

----

 

CVC Europe and BNP Paribas, andcertain members of management, 265,762.48 shares of common stock, or 54% of theCompany’s common stock. In connection with the 2003 Stock Transaction, we sold883.75 shares of common stock directly to CVCEP for $353,500.00. The Companyalso agreed to pay the out of pocket fees and expenses of CVCEP and CVC Europe,which in aggregate were approximately $3.8 million, and gave certain customaryindemnities in favor of CVCEP under the stock purchase agreement. CVCEP is anaffiliate of Citigroup Venture Capital, Ltd., which owned about 34.5% of theCompany’s common stock at the time of the 2003 Stock Transaction. CitigroupVenture Capital, Ltd. has subsequently transferred these shares to Court SquareCapital, Ltd., or Court Square, which, like Citigroup Venture Capital, Ltd., isan indirect wholly-owned subsidiary of Citigroup, Inc.

 

**Repurchases of Common Stock**

Inconnection with the retirement of certain key employees from the Company, werepurchased 6,649.2 shares of Euramax International Class A common stock in2003, totaling approximately $2.6 million in the aggregate.

 

TheCompany has entered into an agreement with Court Square, dated as of February12, 2004, pursuant to which it has agreed to repurchase all of its outstandingcommon stock held by Court Square, or 169,680.62 shares, for an aggregaterepurchase price of approximately $67.9 million. Such transaction is subject torestrictions contained in the indenture to the 8.50% Notes and in the seniorsecured credit facility. The Company expects to complete this transaction on orbefore April 30, 2004.

 

**Stockholders Agreement**

Inconnection with the 2003 Stock Transaction, the Company entered into astockholders agreement with CVCEP and certain of its affiliates, Court Square,and certain other stockholders consisting of members of the Company’smanagement and members of CVCEP’s management (“Minority Stockholders”). Thestockholders agreement provides that the Company’s Chief Executive Officer willbe a member of the Company’s board of directors. CVCEP will initially beentitled to designate three additional members of the Company’s board ofdirectors and Court Square will initially be entitled to designate twoadditional members of the Company’s board of directors (these designationrights to be adjusted from time to time to reflect certain changes in thecommon stock ownership of CVCEP and Court Square).

 

Underthe stockholders agreement, certain corporate actions require the writtenconsent of stockholders holding at least 70% of the Company’s outstanding stockheld by all stockholders party to the stockholders agreement. Initially, thiswill require the written consent of both CVCEP and Court Square. Thesecorporate actions include changes to or issuances of the Company’s equitysecurities, amendments of organizational documents, payment of dividends, orcertain merger or recapitalization transactions. In addition, each action ofthe board of directors will require the approval of at least one director designatedby each of CVCEP and Court Square.

 

Thestockholders agreement generally restricts the transfer of shares of theCompany’s common stock. Exceptions to this restriction include transfers toaffiliates, transfers to the Company, transfers for estate planning purposesand transfers to family members. In each case, so long as any transferee agreesto be bound by the terms of the stockholders agreement. After an initial publicoffering, additional exceptions to the transfer restrictions will include salespursuant to certain registration rights of the stockholders.

 

**Registration Rights Agreement**

Inconnection with their entry into the stockholders agreement, CVCEP, CourtSquare and the Minority Stockholders have entered into an amended and restatedregistration rights agreement with the Company.

 

89

----

 

Pursuant to this registrationrights agreement, upon the written request of CVCEP or Court Square, theCompany has agreed (subject to customary exceptions), on up to three occasionsfor CVCEP and up to two occasions for Court Square, to prepare and file aregistration statement with the SEC concerning the distribution of all or partof the shares held by CVCEP or Court Square, as the case may be, and use itsbest efforts to cause the registration statement to become effective. If theCompany is eligible to use a “short form” registration statement on Form S-2,Form S-3 or any similar form, CVCEP and Court Square may each make unlimitedrequests for registration for their shares of the Company’s common stock. If atany time the Company files a registration statement for its common stock (otherthan pursuant to a demand registration by CVCEP or Court Square, a registrationstatement on Form S-8, Form S-4 or any similar form, or in connection withcertain other registrations), it will use its best efforts to allow otherparties to the registration rights agreement to have their shares of theCompany’s common stock (or a portion of their shares under specifiedcircumstances) included in the offering if the registration form proposed to beused may be used to register the shares. Registration expenses of the sellingstockholders (other than underwriting fees, brokerage fees and transfer taxesapplicable to the shares sold by such stockholders or the fees and expenses ofany accountants or other representatives retained by a selling stockholder)will be paid by the Company. The Company has agreed to indemnify thestockholders against certain customary liabilities in connection with anyregistration.

 

**Advisory Agreement**

Inconnection with the 2003 Stock Transaction, the Company entered into anadvisory agreement with CVC Management LLC, or CVC Management, pursuant towhich CVC Management may provide financial, advisory and consulting services tothe Company. In exchange for these services, CVC Management will be entitled toan annual advisory fee. CVC Management’s annual advisory fee will be thegreater of $0.6 million per year or 1% of the Company’s consolidated EBITDA (asdefined in the advisory agreement), plus out-of-pocket expenses. Annualadvisory fees in excess of $1.0 million are subject to the consent of theCompany’s lenders under the credit facility. In December 2003, the Company paid$0.8 million to CVC Management for the 2003 annual advisory fee. The Companyhas also agreed to pay CVC Management a transaction fee in connection with theconsummation of each acquisition, divestiture or financing, including anyrefinancing, by the Company or any of its subsidiaries, in an amount equal to1% of the value of the transaction, plus reasonable out-of-pocket expenses.Pursuant to the advisory agreement, the Company paid CVC Management a $1.0million transaction fee in July 2003 in connection with services provided inconnection with the 2003 Stock Transaction, a $2.0 million transaction fee inAugust 2003 in connection with the issuance and sale of the 8.5% seniorsubordinated notes due 2011 and a $1.45 million transaction fee in October 2003in connection with the amendment and restatement of the senior secured creditfacility.  This advisory agreement hasan initial term of ten years following the close of the 2003 Stock Transaction,subject to automatic one year extensions thereafter unless terminated by eitherparty upon written notice 90 days prior to the expiration of the initial termor any extension thereof. The advisory agreement automatically terminates on achange of control or an initial public offering of the Company’s common stock.There are no minimum levels of service required to be provided pursuant to theadvisory agreement. The advisory agreement includes customary indemnificationprovisions in favor of CVC Management.

 

90

----

 

**Item 14.  Principal Accountant Fees and Services**

 

The following table presents the aggregate fees billed for servicesrendered by Ernst & Young LLP for the fiscal years ended December 26, 2003and December 27, 2002.

 
|               |   | **Fiscal  2003** |      | **Fiscal  2002** |   |
|--------------------|--------|------------------|-----------|------------------|--------|
| Audit fees         |   | $                | 1,512,000 |             | $      | 645,000 |   |
| Audit-related fees |   | 35,000           |      | 31,000           |   |
| Tax fees           |   | 479,000          |      | 283,000          |   |
| All other fees     |   | —           |      | —           |   |
|               |   |             |      |             |   |
| Total fees         |   | $                | 2,026,000 |             | $      | 959,000 |   |

 

 

*Audit fees.*Theseare fees related to professional services rendered in connection with the auditof our annual financial statements, the review of the financial statementsincluded in each of our Quarterly Reports on Form 10-Q, international statutoryaudits, comfort letters, consents, an Offering Memorandum and registrationstatements, accounting consultations necessary to comply with auditingstandards generally accepted in the United States and other required statutoryprocedures.

 

*Audit-related fees. *These are fees for assurance and relatedservices and consisted primarily of audits of employee benefit plans.

 

*Tax fees. *These are fees billed for professional servicesrelated to U.S. tax returns, international and U.S. tax planning and advice andassistance with international tax returns.

 

*All other fees.*  None.

 

Wehave been advised by Ernst & Young LLP that neither the firm, nor any memberof the firm, has any financial interest, direct or indirect, in any capacity inthe Company or its subsidiaries.

 

**Part IV**

 

**Item15.  Exhibits, Financial StatementSchedules, and Reports on Form 8-K**

 
| (a)(1)   The following consolidated financial statements  of Euramax International, Inc. and its subsidiaries are included in Part II,  Item 8. |                                                                                                                                                                                                                                                          |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                           |                                                                                                                                                                                                                                                          |   |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          | Report of Independent Auditors |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          |   |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          | Consolidated  Statements of Earnings for the five months ended May 23, 2003, the seven  months ended December 26, 2003 and the years ended December 27, 2002 and  December 28, 2001. |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          |   |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          | Consolidated Balance Sheets at December 26, 2003 and December 27,  2002. |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          |   |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          | Consolidated  Statements of Changes in Equity for the five months ended May 23, 2003, the  seven months ended December 26, 2003, and the years ended December 27, 2002  and December 28, 2001. |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          |   |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          | Consolidated  Statements of Cash Flows for the five months ended May 23, 2003, the seven  months ended December 26, 2003, and the years ended December 27, 2002 and  December 28, 2001. |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          |   |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          | Notes to Consolidated Financial Statements |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          |   |   |
| (a)(2)                                                                                                                                                         | Financial Statement Schedule                                                                                                                                                                                                                                  |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          |   |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          | Schedule  II - Valuation and Qualifying Accounts |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          |   |   |
|                                                                                                                                                           | All other schedules for which provision is made in the applicable  accounting regulations of the Securities and Exchange Commission have been  omitted either because they are not required under the related instructions  or because they are inapplicable. |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          |   |   |
| (a)(3)                                                                                                                                                         | The exhibits listed in the Exhibit Index immediately preceding the  exhibits are filed or incorporated by reference as part of this annual report  on Form 10-K.                                                                                              |   |
|                                                                                                                                                           |                                                                                                                                                                                                                                                          |   |
| (b)                                                                                                                                                            | Reports on Form 8-K:                                                                                                                                                                                                                                          |   |
|                                                                                                                                                                |                                                                                                                                                                                                                                                               |  |  |  |  |

 

91

----

 
|   | On October 14, 2003, the Company filed a report on Form 8-K relating  to its entering into an agreement to acquire Berger Holdings, Ltd.                                 |   |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|   |                                                                                                                                                                     |   |   |
|   | On November 18, 2003, the Company filed a report on Form 8-K relating  to the completion of the tender offer for the outstanding common shares of  Berger Holdings, Ltd. |   |
|   |                                                                                                                                                                     |   |   |
|   | On November 26, 2003, the Company filed a report on Form 8-K relating  to the completion of the acquisition of Berger Holdings, Ltd.                                     |   |

 

92

----

 

**SIGNATURES**

 

**Pursuantto the requirements of Section 13 or 15(d) of the Securities and Exchange Actof 1934, Euramax International, Inc. has duly caused this report to be signedon its behalf by the undersigned, thereunto duly authorized.**

 

**EURAMAX INTERNATIONAL, INC.**

 

 
| By:                         | /s/ J. David Smith   |   | Chief Executive Officer and President |
|-----------------------------|----------------------|--------|---------------------------------------|
|                        |  J. David Smith |   |
|                        |                 |
| Dated:  March 25, 2004 |                 |   |
|                             |                      |        |                                       |  |  |

 

**Pursuantto the requirements of the Securities Exchange Act of 1934, this report hasbeen signed below by the following persons on behalf of Euramax International,Inc. and in the capacities and on the dated indicated.**

 
| **Signature** |                                                           | **Title** |   | **Date**                                         |   |
|---------------|----------------------------------------------------------------|-----------|--------|--------------------------------------------------|--------|
|          |                                                           |      |   |                                             |   |   |
| By:           | /s/       J.  David Smith   |      |   | Chief  Executive Officer, President and Director |   | March 25, 2004 |   |
|          | J. David Smith                                                 |      |   |                                             |   |   |
|          |                                                           |      |   |                                             |   |   |
|          |                                                           |      |   |                                             |   |   |
| By:           | /s/       R.  Scott Vansant |      |   | V.P.,  Secretary and Chief Financial Officer     |   | March 25, 2004 |   |
|          | R. Scott Vansant                                               |      |   |                                             |   |   |
|          |                                                           |      |   |                                             |   |   |
|          |                                                           |      |   |                                             |   |   |
| By:           | /s/       Stuart  M. Wallis |      |   | Director                                         |   | March 25, 2004 |   |
|          | Stuart M.  Wallis                                              |      |   |                                             |   |   |
|          |                                                           |      |   |                                             |   |   |
|          |                                                           |      |   |                                             |   |   |
| By:           | /s/    Joseph  M. Silvestri                |      |   | Director                                         |   | March 25, 2004 |   |
|          | Joseph M. Silvestri                                            |      |   |                                             |   |   |
|          |                                                           |      |   |                                             |   |   |
|          |                                                           |      |   |                                             |   |   |
| By:           | /s/   Thomas  F. McWilliams                     |      |   | Director                                         |   | March 25, 2004 |   |
|          | Thomas F. McWilliams                                           |      |   |                                             |   |   |
|          |                                                           |      |   |                                             |   |   |
|          |                                                           |      |   |                                             |   |   |
| By:           | /s/   Richard  E. Mayberry, Jr.                 |      |   | Director                                         |   | March 25, 2004 |   |
|          | Richard E. Mayberry, Jr.                                       |      |   |                                             |   |   |
|          |                                                           |      |   |                                             |   |   |
|          |                                                           |      |   |                                             |   |   |
| By:           | /s/       Paul  E. Drack    |      |   | Director                                         |   | March 25, 2004 |   |
|          | Paul E. Drack                                                  |      |   |                                             |   |   |
|               |                                                                |           |        |                                                  |        |  |  |  |  |  |  |  |  |

 

93

----

 

**Schedule II**

 

**EuramaxInternational, Inc.**

Valuation and Qualifying Accounts

 

Thousands of U.S. Dollars

 
| **Description**                                                               |   | **Classification**                            |   | **Balance at  beginning  of period** |   | **Charged to  costs and  expenses** |   | **Charged to  other  accounts  (1)** |   | **Deductions  (2)** |   | **Balance  at end  of period** |   |
|-------------------------------------------------------------------------------|--------|-----------------------------------------------|--------|--------------------------------------|--------|-------------------------------------|--------|--------------------------------------|--------|---------------------|--------|--------------------------------|--------|
|                                                                          |   |                                          |   |                                 |   |                                |   |                                 |   |                |   |                           |   |
| For the five  months ended May 23, 2003Allowance for doubtful accounts        |   | A/R, net                                      |   | $                                    | (3,513 | )                                   | $      | (212                                 | )      | $                   | (90    | )                              | $      | 660 |   | $ | (3,155 | ) |
| For the  seven months ended December 26, 2003Allowance for doubtful accounts  |   | A/R, net                                      |   | $                                    | (3,155 | )                                   | $      | (600                                 | )      | $                   | (142   | )                              | $      | 941 |   | $ | (2,956 | ) |
|                                                                          |   |                                          |   |                                 |   |                                |   |                                 |   |                |   |                           |   |   |   |   |   |   |
| For the year  ended December 27, 2002Allowance for doubtful accounts          |   | A/R, net                                      |   | $                                    | (3,938 | )                                   | $      | 177                                  |   | $                   | (179   | )                              | $      | 427 |   | $ | (3,513 | ) |
| For the year  ended December 28, 2001Allowance for doubtful accounts          |   | A/R, net                                      |   | $                                    | (2,973 | )                                   | $      | (1,763                               | )      | $                   | 60     |                           | $      | 738 |   | $ | (3,938 | ) |
|                                                                          |   |                                          |   |                                 |   |                                |   |                                 |   |                |   |                           |   |   |   |   |   |   |
| For the five  months ended May 23, 2003Allowance for obsolete inventory       |   | Inventories                                   |   | $                                    | (3,827 | )                                   | $      | (232                                 | )      | $                   | (112   | )                              | $      | 439 |   | $ | (3,732 | ) |
| For the  seven months ended December 26, 2003Allowance for obsolete inventory |   | Inventories                                   |   | $                                    | (3,732 | )                                   | $      | (591                                 | )      | $                   | (274   | )                              | $      | 1,016 |   | $ | (3,581 | ) |
|                                                                          |   |                                          |   |                                 |   |                                |   |                                 |   |                |   |                           |   |
| For the year  ended December 27, 2002Allowance for obsolete inventory         |   | Inventories                                   |   | $                                    | (3,284 | )                                   | $      | (2,234                               | )      | $                   | (286   | )                              | $      | 1,977 |   | $ | (3,827 | ) |
| For the year  ended December 28, 2001Allowance for obsolete inventory         |   | Inventories                                   |   | $                                    | (3,276 | )                                   | $      | (1,352                               | )      | $                   | 85     |                           | $      | 1,259 |   | $ | (3,284 | ) |
|                                                                          |   |                                          |   |                                 |   |                                |   |                                 |   |                |   |                           |   |
| For the five  months ended May 23, 2003  Income tax valuation allowance       |   | Deferred income taxes, long-term liability    |   | $                                    | (2,744 | )                                   | $      | (277                                 | )      | $                   | — |                           | $      | — |   | $ | (3,021 | ) |
|                                                                          |   |                                          |   |                                 |   |                                |   |                                 |   |                |   |                           |   |   |   |   |   |   |
| For the  seven months ended December 26, 2003  Income tax valuation allowance |   | Deferred income taxes, long-term liability    |   | $                                    | (3,021 | )                                   | $      | 556                                  |   | $                   | 576    |                           | $      | — |   | $ | (1,889 | ) |
|                                                                          |   |                                          |   |                                 |   |                                |   |                                 |   |                |   |                           |   |   |   |   |
| For the year  ended December 27, 2002  Income tax valuation allowance         |   | Deferred  income taxes,  long-term  liability |   | $                                    | (2,525 | )                                   | $      | (219                                 | )      | —              |   | —                         |   | $ | (2,744 | ) |
|                                                                          |   |                                          |   |                                 |   |                                |   |                                 |   |                |   |                           |   |
| For the year  ended December 28,  2001  Income tax valuation allowance   |   | Deferred  income taxes,  long-term  liability |   | $                                    | (1,632 | )                                   | $      | (893                                 | )      | —              |   | —                         |   | $ | (2,525 | ) |
|                                                                               |        |                                               |        |                                      |        |                                     |        |                                      |        |                     |        |                                |        |  |  |  |  |  |  |  |  |

 

----

Note:

(1) Changes due to foreign currency translation adjustment, 2003 Stock Transactionand acquisition of Berger Holding, Ltd.

(2) Write-off of bad debts, net of recoveries or write off of obsoleteinventory.

 

94

----

 

**Exhibit Index**

 

 
| **Exhibit  Number** |   | **Description**                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|---------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2.1                 |   | Purchase  agreement dated July 30, 2003 by and among Euramax International, Inc.,  Euramax International Holdings B.V., each of the Guarantors (as defined  therein), UBS Securities LLC, Banc of America Securities LLC, Wachovia  Capital Markets, LLC, ABN AMRO Incorporated, and Fleet Securities, Inc.  (Incorporated by reference to Exhibit 10.1 in Euramax International, Inc.’s  Current Report on Form 8-K which was filed on August 8, 2003).                |
| 2.2                 |   | Agreement  and Plan of Merger, dated as of October 10, 2003, by and among Amerimax  Pennsylvania, Inc., Euramax International, Inc. and Berger Holdings, Ltd.  (Incorporated by reference to Exhibit (d)(1) to Schedule TO of Amerimax  Pennsylvania, Inc. which was filed on October 20, 2003).                                                                                                                                                                             |
| 3.1                 |   | Certificate  of Incorporation of Euramax International, Inc. (f/k/a Amerimax Holdings,  Inc.). (Incorporated by reference to the Exhibit with the same number in  Euramax International, Inc.’s Registrations Statement on Form S-4 (Reg. No.  333-05978) which became effective on February 7, 1997.)                                                                                                                                                                  |
| 3.2                 |   | Bylaws of  Euramax International, Inc. (f/k/a Amerimax Holdings, Inc.). (Incorporated by  reference to the Exhibit with the same number in Euramax International,  Inc.’s Registration Statement on Form S-4 (Ref. No. 333-05978) which became  effective on February 7, 1997.)                                                                                                                                                                                         |
| 3.3                 |   | Articles of  Association of Euramax International Holdings B.V. dated as of August 6,  2003. (Incorporated by reference to the Exhibit with the same number in  Euramax International, Inc.’s Registration Statement on Form S-4 which was  filed on November 4, 2003).                                                                                                                                                                                                 |
| 4.1                 |   | Indenture  dated August 6, 2003 by and among Euramax International, Inc., Euramax  International Holdings B.V., a Dutch registered company, the guarantors party  thereto from time to time, and JP Morgan Chase Bank, as trustee.  (Incorporated by reference to Exhibit 4.2 in Euramax International, Inc.’s  Current Report on Form 8-K which was filed on August 8, 2003).                                                                                          |
| 4.2                 |   | Registration  Rights Agreement dated August 6, 2003 by and among Euramax International,  Inc., Euramax International Holdings B.V., and each of the Guarantors (as  defined therein), UBS Securities LLC, Banc of America Securities LLC,  Wachovia Capital Markets, LLC, ABN AMRO Incorporated, and Fleet Securities,  Inc. (Incorporated by reference to Exhibit 4.3 in Euramax International, Inc.’s  Current Report on Form 8-K which was filed on August 8, 2003). |
| 4.3                 |   | Form of 8 1⁄2%  Senior Subordinated Note Due 2011. (Incorporated by reference to Exhibit A of  Exhibit 4.2 in Euramax International, Inc.’s Current Report on Form 8-K which  was filed on August 8, 2003).                                                                                                                                                                                                                                                          |
| 10.1                |   | Executive  Employment Agreement, dated as of September 25, 1996, by and between J. David  Smith and Euramax International, Inc. (Incorporated by reference to Exhibit  10.1 in Euramax International plc’s Registration Statement on Form S-4 which  became effective on February 7, 1997).                                                                                                                                                                             |
| 10.2                |   | Incentive  Compensation Plan effective January 1, 1997, by Euramax International  Limited. (Incorporated by reference to Exhibit 10.2 in Euramax International  Limited’s Quarterly Report on Form 10-Q which was filed on April 26, 1999).                                                                                                                                                                                                                             |
| 10.3                |   | Phantom  Stock Plan effective January 1, 1999, by Euramax International Limited.  (Incorporated by reference to Exhibit 10.3 in Euramax International Limited’s  Quarterly                                                                                                                                                                                                                                                                                              |

 

95

----

 
|   |   | Report on  Form 10-Q which was filed on April 26, 1999).                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 10.4   |   | Third  Amended and Restated Credit Agreement, dated October 9, 2003, among Euramax  International, Inc. and its subsidiaries, Wachovia Bank, N.A. (as Agent and  Lender) and the Lenders. (Incorporated by reference to Exhibit (b)(1) to the  Schedule TO-T which was filed by Euramax International, Inc. on October 20,  2003).                                                                                                                                                            |
| 10.5   |   | Letter  Agreement, dated December 1, 1999, by and between Euramax International, Inc.  and Mitchell B. Lewis. (Incorporated by reference to Exhibit 10.5 in Euramax  International, Inc.’s Registration Statement on Form S-4 which was filed on  November 4, 2003).                                                                                                                                                                                                                     |
| 10.6   |   | Letter  Agreement, dated December 1, 1999, by and between Euramax International, Inc.  and R. Scott Vansant. (Incorporated by reference to Exhibit 10.6 in Euramax  International, Inc.’s Registration Statement on Form S-4 which was filed on  November 4, 2003).                                                                                                                                                                                                                      |
| 10.7   |   | Intentionally  omitted                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 10.8   |   | Stock  Purchase Agreement by and among Citigroup Venture Capital Equity Partners,  L.P., CVC Executive Fund LLC, CVC/SSB Employee Fund, L.P., Euramax  International, Inc. and the Stockholders of Euramax International, Inc. noted  therein, dated as of April 15, 2003. (Incorporated by reference to Exhibit  10.1 in Euramax International, Inc.’s Quarterly Report on Form 10-Q which was  filed on August 11, 2003).                                                              |
| 10.9   |   | Securities  Holders Agreement by and among Euramax International, Inc., Citigroup Venture  Capital Equity Partners, L.P., CVC Executive Fund LLC, CVC/SSB Employee Fund,  L.P., Citicorp Venture Capital Ltd., The Continuing Investors identified  therein and The Management Investors identified therein dated as of April 15,  2003. (Incorporated by reference to Exhibit 10.2 in Euramax International,  Inc.’s Quarterly Report on Form 10-Q which was filed on August 11, 2003). |
| 10.10  |   | Advisory  Agreement dated as of April 15, 2003 by and among Euramax International, Inc.  and CVC Management LLC. (Incorporated by reference to Exhibit 10.3 in Euramax  International, Inc.’s Quarterly Report on Form 10-Q which was filed on August  11, 2003).                                                                                                                                                                                                                        |
| 10.11  |   | Amendment  No. 1, dated as of April 15, 2003, to the Executive Employment Agreement,  dated as of October 1, 1999, by and between Euramax International, Inc. and  J. David Smith. (Incorporated by reference to Exhibit 10.4 in Euramax  International, Inc.’s Quarterly Report on Form 10-Q which was filed on August  11, 2003).                                                                                                                                                      |
| 10.12  |   | Euramax  International, Inc. 2003 Equity Compensation Plan. (Incorporated by reference  to Exhibit 10.5 in Euramax International, Inc.’s Quarterly Report on Form  10-Q which was filed on August 11, 2003).                                                                                                                                                                                                                                                                             |
| 10.13  |   | Restricted  Stock Agreement dated April 15, 2003 between Euramax International, Inc. and  J. David Smith. (Incorporated by reference to Exhibit 10.6 in Euramax  International, Inc.’s Quarterly Report on Form 10-Q which was filed on August  11, 2003).                                                                                                                                                                                                                               |
| 10.14  |   | Restricted  Stock Agreement dated April 15, 2003 between Euramax International, Inc. and  Mitchell B. Lewis. (Incorporated by reference to Exhibit 10.7 in Euramax  International, Inc.’s Quarterly Report on Form 10-Q which was filed on August  11, 2003).                                                                                                                                                                                                                            |
| 10.15  |   | Restricted  Stock Agreement dated April 15, 2003 between Euramax International, Inc. and  R. Scott Vansant. (Incorporated by reference to Exhibit 10.8 in Euramax  International, Inc.’s Quarterly Report on Form 10-Q which was filed on August  11, 2003).                                                                                                                                                                                                                             |
| 10.16  |   | Form  Restricted Stock Agreement for the Euramax International, Inc. 2003 Equity  Compensation Plan. (Incorporated by reference to Exhibit 10.9 in Euramax  International, Inc.’s Quarterly Report on Form 10-Q which was filed on August  11, 2003).                                                                                                                                                                                                                                    |
| 10.17  |   | Form  Non-Qualified Stock Option Agreement for the Euramax International, Inc. 2003  Equity Compensation Plan. (Incorporated by reference to Exhibit 10.10 in  Euramax                                                                                                                                                                                                                                                                                                                        |

 

96

----

 
|   |   | International,  Inc.’s Quarterly Report on Form 10-Q which was filed on August 11, 2003).                                                                                                                                                                                                                                                                                                                                                                                                 |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 10.18  |   | Amended and  Restated Registration Rights Agreement dated as of June 12, 2003 by and among  Euramax International, Inc., Citicorp Venture Capital Ltd., Citigroup Venture  Capital Equity Partners, L.P., CVC Executive Fund LLC and CVC/SSB Employee  Fund, L.P., and other stockholders of Euramax International, Inc. named  therein. (Incorporated by reference to Exhibit 10.11 in Euramax International,  Inc.’s Quarterly Report on Form 10-Q which was filed on August 11, 2003). |
| 10.19  |   | Letter  Agreement dated April 15, 2003 between R. Scott Vansant and Euramax  International, Inc. (Incorporated by reference to Exhibit 10.12 in Euramax  International, Inc.’s Quarterly Report on Form 10-Q which was filed on August  11, 2003).                                                                                                                                                                                                                                        |
| 10.20  |   | Letter  Agreement dated April 15, 2003 between Mitchell B. Lewis and Euramax  International, Inc. (Incorporated by reference to Exhibit 10.13 in Euramax  International, Inc.’s Quarterly Report on Form 10-Q which was filed on August  11, 2003).                                                                                                                                                                                                                                       |
| 10.21  |   | Euramax  International, Inc. Supplemental Executive Retirement Plan dated April 15,  2003 for J. David Smith. (Incorporated by reference to Exhibit 10.14 in  Euramax International, Inc.’s Quarterly Report on Form 10-Q which was filed  on August 11, 2003).                                                                                                                                                                                                                           |
| 10.22  |   | Euramax  International, Inc. Supplemental Executive Retirement Plan dated April 15,  2003 for Mitchell B. Lewis and R. Scott Vansant. (Incorporated by reference  to Exhibit 10.15 in Euramax International, Inc.’s Quarterly Report on Form  10-Q which was filed on August 11, 2003).                                                                                                                                                                                                   |
| 10.23  |   | Stock  Purchase Agreement by and among Court Square Capital Limited and Euramax  International, Inc., dated as of February 12, 2004. (Incorporated by  reference to Exhibit 10.23 in Euramax International, Inc.’s Registration  Statement on Form S-4/A which was filed on February 23, 2004).                                                                                                                                                                                           |
| 12.1   |   | Computation  of Ratio of Earnings to Fixed Charges                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| 21.1   |   | Subsidiaries  of Euramax International, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 23.1   |   | Consent of  Ernst & Young LLP.                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| 31.1   |   | Certification  of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act  of 2002.                                                                                                                                                                                                                                                                                                                                                                                          |
| 31.2   |   | Certification  of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act  of 2002.                                                                                                                                                                                                                                                                                                                                                                                          |
| 32.1   |   | Certification  of Chief Executive Officer pursuant to 18 U.S.C. Section 1350.                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 32.2   |   | Certification  of Chief Financial Officer pursuant to 18 U.S.C. Section 1350.                                                                                                                                                                                                                                                                                                                                                                                                                  |

 

97

----