UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q


          [X]        QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended July 2, 2005

                                       or

          [_]        TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934


         For the transition period from _____________ to _____________.

                       Commission File Number: 333-114041


                            PLY GEM HOLDINGS INC.
             (Exact name of registrant as specified in its charter)

<TABLE>
<CAPTION>
<S>                                  <C>                            <C>
            Delaware                             3089                    20-0645710
(State or other jurisdiction of      (Primary Standard Industrial     (I.R.S. Employer
 incorporation or organization)       Classification Code Number)   Identification No.)
</TABLE>

                   ------------------------------------------

                               185 Platte Clay Way
                             Kearney, Missouri 64060

        Registrant's telephone number, including area code: 800-800-2244

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

Indicate by check mark whether registrant is an accelerated filer (as defined in
Rule 12b-2 of the Act).
Yes [_]  No [X]

As of August 15, 2005, there were 100 shares of common stock, $0.01 par value,
outstanding.


<PAGE>


                     PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
                                    FORM 10-Q
                           QUARTER ENDED JULY 2, 2005

                                    CONTENTS


PART I - FINANCIAL INFORMATION

Item 1.  Condensed Consolidated Financial Statements

         Condensed Consolidated Statements of Income -
             Three months ended July 2, 2005 and July 3, 2004                  2

         Condensed Consolidated and Combined Statements of Income -
             Six months ended July 2, 2005 and July 3, 2004                    3

         Condensed Consolidated Balance Sheets -
             July 2, 2005 and December 31, 2004                                4

         Condensed Consolidated and Combined Statements of Cash Flows -
             Six months ended July 2, 2005 and July 3, 2004                    5

         Notes to Condensed Consolidated and Combined Financial Statements     6

Item 2.  Management's Discussion and Analysis of Financial Condition
             And Results of Operations                                        29

Item 3.  Quantitative and Qualitative Disclosures about Market Risk           40

Item 4.  Controls and Procedures                                              40


PART II - OTHER INFORMATION

Item 6.   Exhibits                                                            41

Signatures                                                                    41



                                       1
<PAGE>

                         PART I - FINANCIAL INFORMATION

ITEM 1.       FINANCIAL STATEMENTS

                     PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)


                                                    FOR THE THREE MONTHS ENDED
                                                 ------------------------------

                                                  JULY 2, 2005     JULY 3, 2004
                                                  ------------     ------------
                                                       (Amounts in thousands)

 Net Sales .....................................  $    230,303     $    153,025
 Costs and Expenses:
 Cost of products sold .........................       174,842          113,346
 Selling, general and administrative expense ...        23,692           16,386
 Amortization of intangible assets .............         2,441              625
                                                  ------------     ------------
                                                       200,975          130,357
                                                  ------------     ------------
 Operating earnings ............................        29,328           22,668
 Foreign currency loss..........................          (233)              --
 Interest expense...............................       (14,073)          (8,007)

 Investment income..............................           144               31
                                                  ------------     ------------
 Income before provision for income taxes.......        15,166           14,692

 Provision for income taxes.....................         6,058            5,550
                                                  ------------     ------------
 Net income ....................................  $      9,108     $      9,142
                                                  ============     ============

----------------------------------------

See accompanying notes to consolidated financial statements.

                                       2
<PAGE>


                     PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
          CONDENSED CONSOLIDATED AND COMBINED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                       CONSOLIDATED     CONSOLIDATED        COMBINED
                                                         PLY GEM          PLY GEM            PLY GEM
                                                      HOLDINGS, INC.   HOLDINGS, INC.   INDUSTRIES, INC.
                                                     JANUARY 1, 2005  JANUARY 23, 2004   JANUARY 1, 2004
                                                            TO               TO                TO
                                                       JULY 2, 2005     JULY 3, 2004    FEBRUARY 11, 2004
                                                     ---------------  ----------------  ------------------
                                                                     (Amounts in thousands)
<S>                                                  <C>              <C>               <C>
Net Sales ........................................   $       402,038  $      225,775    $        40,612
Costs and Expenses:
Cost of products sold ............................           312,608         171,215             33,611
Selling, general and administrative expense ......            46,734          25,690              8,345
Amortization of intangible assets ................             4,881           1,026                201
                                                     ---------------  --------------    ---------------
                                                             364,223         197,931             42,157
                                                     ---------------  --------------    ---------------
Operating earnings ...............................            37,815          27,844             (1,545)
Foreign currency loss.............................              (537)             --                 --
Interest expense..................................           (28,675)        (13,024)            (3,684)
Investment income.................................               223              20                 29
                                                     ---------------  --------------    ---------------
Income (loss) before provision (benefit) for
   income taxes...................................             8,826          14,840             (5,200)
Provision (benefit) for income taxes..............             3,573           5,639             (1,850)
                                                     ---------------  --------------    ---------------
Net income (loss).................................   $         5,253  $        9,201    $        (3,350)
                                                     ===============  ==============    ===============
</TABLE>

 See accompanying notes to consolidated financial statements.

                                       3
<PAGE>

                     PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                                    JULY 2,       DECEMBER 31,
                                                                                      2005            2004
                                                                                -------------     ------------
                                                                                 (Amounts in thousands, except
                                                                                          share amounts)
                                                                                  (Unaudited)
                                     ASSETS
<S>                                                                             <C>               <C>
CURRENT ASSETS:
Cash and cash equivalents...................................................    $    26,607       $    6,794
Accounts receivable, less allowances of $8,101 and $7,941, respectively ..           95,216           65,217
Inventories:
    Raw materials...........................................................         37,907           30,505
    Work in process.........................................................          4,496            4,260
    Finished goods..........................................................         26,046           26,731
                                                                                -----------       ----------
    Total inventory.........................................................         68,449           61,496
Prepaid expenses and other current assets ..................................         12,462            9,796
Deferred income taxes.......................................................         19,213           18,356
                                                                                -----------       ----------
     Total current assets...................................................        221,947          161,659

PROPERTY AND EQUIPMENT:
Land........................................................................          2,013            7,257
Buildings and improvements..................................................         15,282           46,491
Machinery and equipment.....................................................        109,824          105,162
                                                                                -----------       ----------
                                                                                    127,119          158,910
Less accumulated depreciation ..............................................        (18,830)         (11,874)
                                                                                -----------       ----------
    Total property and equipment, net ......................................        108,289          147,036

OTHER ASSETS:
Goodwill....................................................................        583,781          585,150
Intangible assets, less accumulated amortization of $10,629 and $5,743,
    respectively ...........................................................        157,771          162,657
Other.......................................................................         41,049           47,797
                                                                                -----------       ----------
    Total other assets......................................................        782,601          795,604
                                                                                -----------       ----------
                                                                                $ 1,112,837     $  1,104,299
                                                                                ===========     ============

                      LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current maturities of long-term debt .......................................    $     1,948     $      2,784
Accounts payable............................................................         63,192           34,600
Accrued expenses and taxes..................................................         62,737           61,944
                                                                                -----------       ----------
     Total current liabilities..............................................        127,877           99,328
Deferred income taxes.......................................................         71,791           72,356
Other long term liabilities.................................................         27,468           32,401
Long-term debt, less current maturities.....................................        685,517          704,807

STOCKHOLDERS' EQUITY:
Preferred stock $0.1 par, 100 shares authorized, none issued and outstanding             --               --
Common stock $0.1 par, 100 shares authorized, issued and outstanding                     --               --
Additional paid-in-capital..................................................        175,277          175,427
Retained earnings...........................................................         22,935           17,682
Accumulated other comprehensive income......................................          1,972            2,298
                                                                                -----------       ----------
     Total Stockholders' Equity.............................................        200,184          195,407
                                                                                -----------       ----------
                                                                                $ 1,112,837     $  1,104,299
                                                                                ===========     ============
</TABLE>

See accompanying notes to consolidated financial statements.

                                       4
<PAGE>

                     PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
          CONDENSED CONSOLIDATED AND COMBINED STATEMENTS OF CASH FLOWS

                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                         CONSOLIDATED          CONSOLIDATED            COMBINED
                                                         ------------          ------------            --------
                                                            PLY GEM              PLY GEM               PLY GEM
                                                        HOLDINGS, INC.        HOLDINGS, INC.       INDUSTRIES, INC.
                                                        JANUARY 1, 2005      JANUARY 23, 2004      JANUARY 1, 2004
                                                              TO                    TO                    TO
                                                         JULY 2, 2005          JULY 3, 2004       FEBRUARY 11, 2004
                                                         ------------          ------------       -----------------
                                                                          (Amounts in thousands)
<S>                                                      <C>                   <C>                <C>
CASH FLOWS FROM OPERATING ACTIVITIES:

     Net income (loss) ................................. $      5,253          $      9,201       $      (3,350)
     ADJUSTMENTS TO RECONCILE NET INCOME
        (LOSS) TO CASH PROVIDED BY (USED IN)
        OPERATING ACTIVITIES:
     Depreciation and amortization expense....                 13,005                 5,217               1,373
     Write-off of inventory.............................           --                 1,974                  --
     Non-cash interest expense, net................             2,377                     2                  26
     Loss (gain) on foreign currency transactions..               537                    --                  --
     Deferred income taxes .............................       (1,404)                   --              (1,710)
     CHANGES IN OPERATING ASSETS AND
        LIABILITIES, NET OF EFFECTS FROM
        ACQUISITIONS:
     Accounts receivable, net...........................      (30,073)              (26,668)              1,869
     Inventories .......................................       (7,050)                3,117              (3,224)
     Prepaid expenses and other current assets..........       (2,210)                 (742)               (260)
     Accounts payable...................................       28,585                 2,549               7,765
     Accrued expenses and taxes ........................          (22)               12,986              (1,339)
     Other.............................................            30                 1,535                 498
                                                         ------------          ------------       -------------
         NET CASH PROVIDED BY
           OPERATING ACTIVITIES........................         9,028                 9,171               1,648
CASH FLOWS FROM INVESTING ACTIVITIES:
     Capital expenditures..............................        (5,160)               (2,370)               (718)
     Change in restricted cash ........................            --                    --               1,118
     Acquisitions, net of cash acquired................           482              (552,196)                 --
     Other.............................................            --                    --                  (5)
                                                         ------------          ------------       -------------
         NET CASH PROVIDED BY (USED IN)
           INVESTING ACTIVITIES........................        (4,678)             (554,566)                395
CASH FLOWS FROM FINANCING ACTIVITIES:
     Proceeds from long-term debt......................        35,500               434,000                  --
     Payments on long-term debt........................       (19,894)              (14,509)                (89)
     Net transfers to former parent....................            --                    --              (7,362)

     Equity contribution (distribution)................          (150)              136,725                  --
                                                         ------------          ------------       -------------
         NET CASH PROVIDED BY (USED IN)
           FINANCING ACTIVITIES........................        15,456               556,216              (7,451)
     Impact of exchange rate movements on cash.........             7                    --                  --
                                                         ------------          ------------       -------------
     Net increase (decrease) in cash and
        cash equivalents...............................        19,813                10,821              (5,408)
     Cash and cash equivalents at the
        beginning of the period........................         6,794                    --               8,517
                                                         ------------          ------------       -------------
     Cash and cash equivalents at the
        end of the period..............................  $     26,607          $     10,821       $       3,109
                                                         ============          ============       =============
</TABLE>

 See accompanying notes to consolidated financial statements.

                                       5
<PAGE>

        NOTES TO CONDENSED CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
                                   (UNAUDITED)


1.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of Ply
Gem Holdings, Inc. ("Ply Gem" or the "Company") and the combined financial
statements of Ply Gem Industries, Inc. and CWD Windows and Doors ("Ply Gem
Industries, Inc.") have been prepared in accordance with U.S. generally accepted
accounting principles as described in the consolidated financial statements and
related notes included in our 2004 Annual Report on Form 10-K filed with the
Securities and Exchange Commission on March 31, 2005. These statements do not
include all of the information and footnotes required by U.S. generally accepted
accounting principles and should be read in conjunction with our 2004 Annual
Report on Form 10-K. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the period from January 1, 2005 through
July 2, 2005 are not necessarily indicative of the results that may be expected
for the year ended December 31, 2005.

The condensed consolidated balance sheet at December 31, 2004 has been derived
from the audited consolidated financial statements of Ply Gem Holdings, Inc. at
that date but does not include all of the information and footnotes required by
U.S. generally accepted accounting principles for complete financial statements.

The Company's fiscal quarters are based on periods ending on the last Saturday
of the last week in the quarter. Therefore the financial results of certain
fiscal quarters will not be exactly comparable to the prior and subsequent
fiscal quarters.

Ply Gem Holdings, Inc., a wholly owned subsidiary of Ply Gem Investment
Holdings, Inc., was incorporated on January 23, 2004 for the purpose of
acquiring Ply Gem Industries, Inc. from Nortek, Inc. (the "Ply Gem
Acquisition"). The Ply Gem Acquisition was completed on February 12, 2004, as
Nortek, Inc. sold Ply Gem Industries, Inc., to Ply Gem Holdings, Inc., an
affiliate of Caxton-Iseman Capital, Inc., pursuant to the terms of the Stock
Purchase Agreement among Ply Gem Investment Holdings, Inc., Nortek, Inc., and
WDS LLC dated as of December 19, 2003, as amended (the "Purchase Agreement").
Prior to February 12, 2004, the date of the Ply Gem Acquisition, Ply Gem
Holdings, Inc. had no operations and Ply Gem Industries, Inc. was wholly owned
by a subsidiary of WDS LLC, which was a wholly owned subsidiary of Nortek, Inc.
(collectively with subsidiaries "Nortek").

On August 27, 2004 Ply Gem Industries, Inc. acquired all of the outstanding
shares of capital stock of MWM Holding, Inc., ("MWM Holding"), in accordance
with a stock purchase agreement entered into among Ply Gem Industries, Inc., MWM
Holding, Inc., and the selling stockholders (the "MW Acquisition"). The
accompanying financial statements include the operating results of MWM Holding
from August 27, 2004, the date of acquisition.

The accompanying financial statements include the consolidated results of
operations for the Company for the period from January 23, 2004 to July 3, 2004
and January 1, 2005 to July 2, 2005, and the combined results of operations of
Ply Gem Industries, Inc. for the period from January 1, 2004 to February 11,
2004, consolidated results of operations for the three month periods ended July
2, 2005 and July 3, 2004, and consolidated financial position for the Company as
of July 2, 2005 and December 31, 2004. The periods presented for 2004 provide
the combined operating results of Ply Gem Industries, Inc. from the beginning of
the year, January 1, 2004, until the date of the Ply Gem Acquisition, February
12, 2004 (see Note 2), as well as the consolidated operating results from the
date of inception of Ply Gem Holdings, Inc., January 23, 2004, through the end
of the second quarter, July 3, 2004. Ply Gem Holdings, Inc. had no operations
during the period from January 23 to February 11, 2004.

Ply Gem is a diversified manufacturer of residential and commercial building
products, which are sold, primarily in the United States and Canada, and include
a wide variety of products for the residential and commercial construction, the
do-it-yourself and the professional remodeling and renovation markets.

                                       6
<PAGE>

The demand for our products is seasonal, particularly in the Northeast and
Midwest regions of the United States and Western Canada where inclement weather
during the winter months usually reduces the level of building and remodeling
activity in both the home repair and remodeling and new home construction
sectors. Our sales are usually lower during the first and fourth quarters.

Since our building products are intended for exterior use, our sales and
operating earnings tend to be lower during periods of inclement weather. Weather
conditions in the first quarter of each calendar year historically result in
that quarter producing significantly less sales revenue than in any other period
of the year. As a result, we have historically had lower profits or losses in
the first quarter, and reduced profits in the fourth quarter of each calendar
year due to the weather. Our results of operations for individual quarters in
the future may be impacted by adverse weather conditions. Since a portion of our
manufacturing overhead and operating expenses are relatively fixed throughout
the year, operating income and net earnings tend to be lower in quarters with
lower sales levels. In addition, the demand for cash to fund our working capital
is greater from late in the fourth quarter through the first quarter.

Our performance is dependent to a significant extent upon the levels of home
repair and remodeling and new home construction spending, all of which are
affected by such factors as interest rates, inflation, consumer confidence and
unemployment.


PRINCIPLES OF CONSOLIDATION AND COMBINATION

The consolidated and combined financial statements include the accounts of Ply
Gem Holdings, Inc. and its subsidiaries, all of which are wholly owned, or Ply
Gem Industries, Inc. and its subsidiaries combined with CWD Windows and Doors, a
division of Broan-Nutone Canada, Inc. All intercompany accounts and transactions
have been eliminated.

ACCOUNTING POLICIES AND USE OF ESTIMATES

The preparation of these consolidated and combined financial statements in
conformity with generally accepted accounting principles in the United States
involves estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities as of the
date of the financial statements and the reported amounts of income and expense
during the reporting periods. Certain of the Company's accounting policies
require the application of judgment in selecting the appropriate assumptions for
calculating financial estimates. By their nature, these judgments are subject to
an inherent degree of uncertainty. The Company periodically evaluates the
judgments and estimates used in their critical accounting policies to ensure
that such judgments and estimates are reasonable for their interim and year-end
reporting requirements. These judgments are based on the Company's historical
experience, current trends and information available from other sources, as
appropriate. If different conditions result from those assumptions used in the
Company's judgments, the results could be materially different from the
Company's estimates.

INVENTORIES

Inventories in the accompanying consolidated balance sheets are valued at the
lower of cost or market. At July 2, 2005 and December 31, 2004, approximately
$17.4 million and $11.7 million of total inventories, respectively, were valued
on the last-in, first-out method ("LIFO"). Under the first-in, first-out method
("FIFO") of accounting, such inventories would have been approximately $1.2
million higher at July 2, 2005 and $1.2 million higher at December 31, 2004. All
other inventories were valued under the FIFO method. The Company records
provisions, as appropriate, to write-down obsolete and excess inventory to
estimated net realizable value. The process for evaluating obsolete and excess
inventory often requires the Company to make subjective judgments and estimates
concerning future sales levels, quantities and prices at which such inventory
will be able to be sold in the normal course of business. Accelerating the
disposal process or incorrect estimates of future sales potential may cause the
actual results to differ from the estimates at the time such inventory is
disposed or sold.

                                       7
<PAGE>

RELATED PARTY TRANSACTIONS

Included in the combined statement of operations in selling, general and
administrative expense are former parent company (Nortek) corporate charges of
approximately $0.3 million for the period from January 1, 2004 to February 11,
2004, related to accounting, legal, insurance, treasury and other management
services provided by Nortek, which have been allocated based upon a combination
of the specific identification method and as a percentage of the Company's net
sales to Nortek's consolidated net sales. In the opinion of the Company's
management, this method of allocating such costs was reasonable. Included in
interest expense is approximately $3.5 million for the period from January 1,
2004 to February 11, 2004 related to interest owed to a subsidiary which was
wholly owned by Nortek.

Upon completion of the Ply Gem Acquisition, the Company entered into two
advisory agreements with an affiliate of Caxton-Iseman Capital or related
parties, or the "Caxton-Iseman Party", which we refer to as the "Debt Financing
Advisory Agreement" and the "General Advisory Agreement". Under the Debt
Financing Advisory Agreement, we paid the Caxton-Iseman Party a debt financing
arrangement and advisory fee, equal to 2.375% of the aggregate amount of the
debt financing incurred in connection with the Ply Gem Acquisition ($11.4
million), in the first quarter of 2004. Also under the Debt Financing Advisory
Agreement, we paid the Caxton-Iseman Party $6.4 million in the fourth quarter of
2004 in connection with the MW acquisition. Under the General Advisory
Agreement, the Company paid a management fee to the Caxton-Iseman Party of
approximately $0.7 million for the period from January 23, 2004 to July 3, 2004,
and approximately $1.0 million for the period from January 1, 2005 to July 2,
2005. Management fees of $0.5 million and $0.7 million were paid for the three
month periods ended July 3, 2004 and July 2, 2005, respectively.


FOREIGN CURRENCY

The Company's Canadian subsidiary utilizes the Canadian dollar as its functional
currency. For reporting purposes, the Company translates the assets and
liabilities of its foreign entity at the exchange rates in effect at the end of
the reporting periods. Net sales and expenses are translated using average
exchange rates in effect during the periods. Gains and losses from foreign
currency translation are credited or charged to accumulated other comprehensive
income in the accompanying consolidated balance sheets. A gain or loss resulting
from fluctuations in the exchange rate may be recognized due to debt,
denominated in US dollars, recorded by the Company's Canadian subsidiary.

For the period January 1, 2005 to July 2, 2005, the Company recorded a loss from
foreign currency transactions of approximately $0.5 million. As of July 2, 2005,
and December 31, 2004 accumulated other comprehensive income included a currency
translation adjustment of approximately $2.2 million and $2.6 million,
respectively.

STOCK OPTIONS

On February 12, 2004, Ply Gem Investment Holdings, Inc.'s Board of Directors
adopted the 2004 Stock Option Plan (the "Plan") providing for grants of up to
140,494 shares of Ply Gem Investment Holdings, Inc.'s common stock under
nonqualified stock options and subsequently increased the grants provided under
the plan up to 184,065 shares on November 30, 2004. Employees of Ply Gem
Investment Holdings, Inc. or any majority-owned subsidiary are eligible for
awards, as specified in the Plan. Ply Gem Investment Holdings, Inc.'s Board of
Directors or Compensation Committee retains the right to select the grantees and
set the term of each award, which may not be more than ten years. Ply Gem
Investment Holdings, Inc.'s Board of Directors also has the power to determine
the terms of the awards granted, including the number of shares subject to each
award and other matters as specified in the Plan agreement. Generally, the
exercise price of an option must be at least the estimated fair market value of
a share as of the grant date. Previously granted awards generally vest over five
years from the date of grant.

For the periods January 23, 2004 through July 3, 2004, and January 1, 2005
through July 2, 2005 , the Company accounted for its stock-based employee
compensation plan under the recognition and measurement principles of APB
Opinion No. 25, ACCOUNTING FOR STOCK ISSUED TO EMPLOYEES, and related
Interpretations. No stock-based employee compensation cost is reflected in the
statement of operations, as all options granted under those plans had an
exercise price at least equal to the market value of the underlying common stock
on the date of grant. The following table illustrates the effect on net income
if

                                       8
<PAGE>

the Company had applied the fair value recognition provisions of SFAS No. 123,
ACCOUNTING FOR STOCK-BASED COMPENSATION, to stock-based employee compensation.

<TABLE>
<CAPTION>
                                                          PLY GEM                    PLY GEM
                                                       HOLDINGS, INC.            HOLDINGS, INC.
                                                     JANUARY 1, 2005 -         JANUARY 23, 2004 -
                                                        JULY 2, 2005              JULY 3, 2004
                                                        ------------              ------------
                                                                (AMOUNTS IN THOUSANDS)
<S>                                                         <C>                       <C>
Net income as reported                                      $  5,253                  $  9,201
Deduct: Total stock-based employee compensation
expense determined under fair-value method for all
awards, net of tax effects                                       (16)                       (8)
                                                             -------                  --------
Pro forma net income                                        $  5,237                  $  9,193
                                                            ========                  ========

                                                                  THREE MONTHS ENDED
                                                        --------------------------------------
                                                        JULY 2, 2005              JULY 3, 2004
                                                                (AMOUNTS IN THOUSANDS)

Net income as reported                                       $ 9,108                  $  9,142
Deduct: Total stock-based employee compensation
expense determined under fair-value method for all
awards, net of tax effects                                        (8)                       (8)
                                                             -------                  --------
Pro forma net income                                         $ 9,100                  $  9,134
                                                             =======                  ========
</TABLE>


SALE LEASEBACK

On August 27, 2004, Ply Gem Industries, Inc. entered into a sale and leaseback
transaction with net proceeds of approximately $36.0 million being used to fund
a portion of the acquisition of MWM Holding, Inc. It was the Company's intention
that these leases meet the criteria for a sale leaseback transaction and receive
accounting treatment as operating leases. Following Ply Gem Industries' review,
the original lease agreements were executed and treated as a sale leaseback
transaction and were accounted for as operating leases in the Company's third
quarter 2004 results. After further review in connection with the preparation of
the December 31, 2004 financial statements, the Company concluded that for the
periods from August 27, 2004 through October 2, 2004 (Ply Gem Holdings, Inc.'s
third quarter) and from October 3, 2004 to December 31, 2004 and January 1, 2005
until an amended lease became effective, these leases did not meet the sale
leaseback accounting criteria. The primary discrepancy that was identified in
the leases related to default and exchange provisions contained within the
original leases that resulted in prohibited forms of continuing involvement. The
lease agreement was amended effective March 29, 2005 and as of the end of the
first quarter, April 2, 2005, the assets and financing obligation liability had
been removed from the consolidated balance sheet and the leases are accounted
for as operating leases.


NEW ACCOUNTING PRONOUNCEMENTS

In December 2004, the FASB issued SFAS No. 123 (revised 2004) ("SFAS 123R"),
SHARE-BASED PAYMENT. SFAS 123R establishes standards for the accounting for
transactions in which an entity exchanges its equity instruments for goods and
services or incurs liabilities in exchange for goods or services that are based
on the fair value of the entity's equity instruments or that may be settled by
the issuance of those equity instruments. SFAS 123R requires a public entity to
measure the cost of employee services received in exchange for an award of
equity instruments based on the grant-date fair value of the award and to
recognize that cost over the period during which an employee is required to
provide service in exchange for the award. Due to the Security and Exchange
Commission's delay of the effective date, the Company plans to adopt the
provisions of SFAS 123R for the first quarter of our fiscal year ending December
31, 2006. At this time, we do not anticipate that the adoption of this statement
will have a material effect on our consolidated financial position or results of
operations.

                                       9
<PAGE>

In March 2005, the FASB issued Financial Interpretation No. 47, "Accounting for
Conditional Asset Retirement Obligations" (FIN 47). FIN 47 clarifies the term,
conditional asset retirement obligation, as used in SFAS No. 143 "Accounting for
Asset Retirement Obligations," which refers to a legal obligation to perform an
asset retirement activity in which the timing and (or) method of settlement are
conditional on a future event. Uncertainty about the timing and (or) method of
settlement of a conditional asset retirement obligation should be factored into
the measurement of the liability when sufficient information exists. FIN 47 is
effective no later than the end of fiscal years ending after December 15, 2005.
We are evaluating the effect FIN 47 will have on our consolidated financial
statements.

CONCENTRATION OF CREDIT RISK

The accounts receivable balance related to one customer of our siding, fencing,
railing and decking segment was approximately $14.4 million and $9.6 million at
July 2, 2005 and December 31, 2004, respectively. This customer accounted for
approximately 19.0% of net sales for the six month period ended July 2, 2005 and
approximately 24.3% of net sales for the year ended December 31, 2004.

FAIR VALUE OF FINANCIAL INSTRUMENTS

         The carrying value of the Company's senior subordinated notes at July
2, 2005 was approximately $360.0 million. The fair value of the Company's senior
subordinated notes at July 2, 2005 is estimated to be approximately $302.4
million based on available market information. The carrying value of the
Company's other financial instruments approximates their fair value.


2.       PURCHASE ACCOUNTING

On February 12, 2004, Ply Gem Holdings, Inc. purchased Ply Gem Industries, Inc.
from Nortek, Inc. The Company accounted for the transaction as a purchase in
accordance with the provisions of SFAS No. 141, which results in a new valuation
for the assets and liabilities of Ply Gem Industries, Inc. and its subsidiaries
based upon fair values as of the date of the purchase. The purchase price,
including approximately $4.3 million of value attributed to Ply Gem Investment
Holdings, Inc. phantom stock issued to replace Ply Gem Industries, Inc.
employees' forfeited Nortek stock options, was allocated to the assets and
liabilities based on their estimated fair values.

                                                               (IN THOUSANDS)
                                                              ----------------
         Other current assets, net of cash                    $         68,357
         Inventories                                                    50,293
         Property, plant and equipment                                 116,626
         Trademarks/Tradenames                                          25,900
         Patents                                                        12,000
         Customer relationships                                         16,000
         Goodwill                                                      381,110
         Other assets                                                   38,661
         Current liabilities                                           (55,964)
         Assumed indebtedness                                          (29,473)
         Other liabilities                                             (71,114)
                                                              ----------------
         Purchase price, net of cash acquired                 $        552,396
                                                              ================

On August 27, 2004 Ply Gem Industries, Inc. acquired all of the outstanding
shares of capital stock of MWM Holding, Inc. in accordance with a stock purchase
agreement entered into among Ply Gem, MWM Holding, Inc., and the selling
stockholders. The Company accounted for the transaction as a purchase in
accordance with the provisions of SFAS No. 141, which results in a new valuation
for the assets and liabilities of MWM Holding Inc. and its subsidiaries based
upon fair values as of the date of the purchase. The purchase price, including
approximately $2.0 million of value attributed to Ply Gem Investment Holdings,
Inc. phantom stock issued to replace MWM Holding, Inc. employees' forfeited MWM
Holding, Inc. stock options, was allocated to the assets and liabilities based
on their estimated fair values.

                                       10
<PAGE>

                                                               (IN THOUSANDS)
                                                              ----------------
         Other current assets, net of cash                    $         22,569
         Inventories                                                    14,437
         Property, plant and equipment                                  36,525
         Trademarks/Tradenames                                          32,500
         Customer relationships                                         82,107
         Goodwill                                                      199,685
         Other assets                                                   14,219
         Current liabilities                                           (30,291)
         Other liabilities                                             (35,084)
                                                              ----------------
         Purchase price, net of cash acquired                 $        336,667
                                                              ================

We have estimated the fair value of our assets and liabilities, as of the MW
Acquisition date, utilizing information available at the time our consolidated
financial statements were prepared. These estimates are subject to refinement
until all pertinent information has been obtained.

Unaudited pro forma results of operations for the periods January 1, 2004 to
February 11, 2004 and January 23, 2004 to July 3, 2004, and for the three month
period ended July 3, 2004, as if both purchases had occurred at the beginning of
the period is as follows:

                                      JANUARY 23, 2004        JANUARY 1, 2004
                                             TO                      TO
                                        JULY 3, 2004         FEBRUARY 11, 2004
                                        ------------         -----------------
                                              (Amounts in thousands)

       Net sales                           $ 336,909                $ 67,757
       Net income(loss)                       11,680                 (3,187)

                                               THREE MONTHS ENDED
                                                  JULY 3, 2004
                                                  ------------
                                                (Amounts in thousands)

               Net sales                             $ 227,275
               Net income                               11,717



                                       11
<PAGE>

3.       GOODWILL AND INTANGIBLE ASSETS

The table that follows presents the components of intangible assets as of July
2, 2005 and December 31, 2004:

<TABLE>
<CAPTION>
                                          AVERAGE
                                        AMORTIZATION
                                           PERIOD                         ACCUMULATED     NET CARRYING
                                         (IN YEARS)          COST         AMORTIZATION        VALUE
                                         ----------          ----         ------------        -----
                                                                   (AMOUNTS IN THOUSANDS)
<S>                                          <C>          <C>              <C>              <C>
AS OF JULY 2, 2005:
Patents                                      13           $  12,000        $   (1,286)      $  10,714
Trademarks/Tradenames                        15              25,900            (2,415)         23,485
Customer relationships                       14              98,000            (6,928)         91,072
                                                          ---------        ----------       ---------
Total intangible assets                                   $ 135,900        $  (10,629)      $ 125,271
                                                          =========        ==========       =========

Intangible with indefinite lives:
Trademarks                                                $  32,500        $       --       $ 32,500

AS OF DECEMBER 31, 2004:
Patents                                      13           $  12,000        $     (834)      $  11,166
Trademarks/Tradenames                        15              25,900            (1,574)         24,326
Customer relationships                       14              98,000            (3,335)         94,665
                                                          ---------        ----------       ---------
Total intangible assets                                   $ 135,900        $   (5,743)      $ 130,157
                                                          =========        ==========       =========

Intangible with indefinite lives:
Trademarks                                                $  32,500        $       --       $  32,500
                                                          =========        ==========       =========
</TABLE>

Amortization expense for the periods from January 1, 2005 to July 2, 2005 and
from January 1, 2004 to February 11, 2004 and January 23, 2004 to July 3, 2004
was approximately $4.9 million, $0.2 million, and $1.0 million, respectively.
Amortization expense for the remainder of 2005, and for the five succeeding
fiscal years is estimated to be approximately $4.9 million, $9.8 million, $9.8
million, $9.8 million, $9.8 million, and $9.8 million, respectively.

Goodwill decreased by approximately $1.4 million from December 31, 2004 to July
2, 2005 due to the finalization of the working capital settlement and other
purchase accounting adjustments.



4.       COMPREHENSIVE INCOME (LOSS)

Comprehensive income (loss) is comprised of the following:

<TABLE>
<CAPTION>
                                            JANUARY 1, 2005   JANUARY 23, 2004    JANUARY 1, 2004
                                                   TO                TO                  TO
                                              JULY 2, 2005     JULY 3, 2004      FEBRUARY 11, 2004
                                              ------------     ------------      -----------------
                                                            (AMOUNTS IN THOUSANDS)
<S>                                                <C>              <C>               <C>
Net income (loss)                                  $ 5,253          $ 9,201           $ (3,350)
Foreign currency translation adjustment               (326)            (116)              (375)
                                                   -------          -------           --------
Comprehensive income (loss)                        $ 4,927          $ 9,085           $ (3,725)
                                                   =======          =======           ========
</TABLE>

                                       12
<PAGE>

                                                   THREE MONTHS ENDED
                                             -------------------------------
                                            JULY 2, 2005        JULY 3, 2004

                                                 (AMOUNTS IN THOUSANDS)

Net income                                       $ 9,108             $ 9,142
Foreign currency translation adjustment             (175)               (107)
                                                 -------             -------
Comprehensive income                             $ 8,933             $ 9,035
                                                 =======             =======


5.       LONG-TERM DEBT

Long-term debt in the accompanying consolidated balance sheets at July 2, 2005
and December 31, 2004 consists of the following:

                                               JULY 2, 2005   DECEMBER 31, 2004
                                               ------------   -----------------
                                                   (AMOUNTS IN THOUSANDS)

  Senior term loan facility                      $   303,166      $   304,501
  Senior revolver credit facility                     24,000               --
  Senior subordinated notes                          360,299          360,321
  Asset financing obligation                              --           35,769
  Other borrowings                                        --            7,000
                                                 -----------      -----------
                                                     687,465          707,591
  Less current maturities                              1,948            2,784
                                                 -----------      -----------
                                                  $  685,517       $  704,807
                                                  ==========       ==========


The Company's senior credit facility with a syndicate of financial institutions
and institutional lenders provides for senior secured financing of up to $381.0
million, consisting of $311.0 million of term loan facilities with a maturity of
seven years after the original date of the credit agreement (February 12, 2004)
and a $70.0 million revolving loan facility, including a letter of credit
subfacility, with a maturity of five years. The term loan facility was drawn in
full in connection with the consummation of the Ply Gem and MW Acquisitions. The
term loan facilities have three tranches, originally consisting of: 1) a $170.0
million tranche under which Ply Gem Industries, Inc. is the borrower, 2) a $30.0
million tranche under which our Canadian subsidiary, CWD Windows and Doors,
Inc., is the borrower, and 3) a $111.0 million tranche under which Ply Gem
Industries, Inc. is the borrower, which was added to the facility August 27,
2004, as a result of the financing for the MW acquisition.

During the first quarter of 2005 we borrowed $35.5 million under the revolving
credit facility and during the second quarter of 2005 we repaid $11.5 million.
As of July 2, 2005, we had $44.9 million of availability under our revolving
credit facility.

The interest rates applicable to loans under our senior credit facilities will
be, at our option, equal to either a base rate plus an applicable interest
margin, or an adjusted LIBOR rate plus an applicable interest margin, as defined
in the senior credit facility agreement. Our rates at July 2, 2005 ranged from
5.2% to 5.8%.

Our senior credit facilities (following amendments) require scheduled quarterly
principal payments on the term loan facilities of approximately $0.5 million
beginning in the quarter ended July 3, 2004 and for the next 23 calendar
quarters thereafter, and payments of $45.8 million on June 30, 2010, September
30, 2010, and December 30, 2010 and $156.6 million on the maturity date,
allocated pro rata between the three tranches.

The indebtedness of the U.S. borrower (Ply Gem Industries, Inc.) under our
senior credit facilities is guaranteed by Ply Gem Holdings, Inc., and all of our
existing and future direct and indirect subsidiaries, subject to exceptions for
foreign subsidiary guarantees of the U.S. borrower's obligations to the extent
such guarantees are prohibited by applicable law or would result in materially
adverse tax consequences and other exceptions. The indebtedness of the Canadian
borrower under our senior credit facilities is guaranteed by Ply Gem Holdings,
Inc., the U.S. borrower and all of the Canadian borrower's future direct and
indirect subsidiaries and is effectively guaranteed by all subsidiaries
guaranteeing the U.S.

                                       13
<PAGE>

borrower's obligations under our senior credit facilities. All indebtedness
under our senior credit facilities is secured, subject to certain exceptions, by
a perfected first priority pledge of all of our equity interests and those of
our direct and indirect subsidiaries, and, subject to certain exceptions,
perfected first priority security interests in, and mortgages on, all tangible
and intangible assets; provided that all tangible and intangible assets of the
Canadian borrower and its subsidiaries are pledged to secure debt only of the
Canadian borrower.

Our senior credit facilities require that we comply on a quarterly basis with
certain financial covenants, including a minimum interest coverage ratio test, a
maximum leverage ratio test and a maximum capital expenditures level. Our
covenants also restrict the payment of dividends, with certain exceptions,
without the lenders consent in writing. The Company is also required at each
year end to calculate and submit within 90 days a payment of excess cash, as
defined in the Company's credit agreement. This payment will reduce the
outstanding balance on the Company's term loans.

Concurrently with the Ply Gem Acquisition, Ply Gem Industries, Inc. issued
$225.0 million aggregate principal amount of our 9% senior subordinated notes
due 2012, which are guaranteed by Ply Gem Holdings Inc. and the domestic
subsidiaries of Ply Gem Industries, Inc. Subsequently, in connection with the MW
Acquisition, Ply Gem Industries, Inc. issued an additional $135.0 million of our
9% senior subordinated notes due 2012, which are guaranteed by Ply Gem Holdings
Inc. and the domestic subsidiaries of Ply Gem Industries, Inc.

Ply Gem Holdings, Inc. is a holding company and has no operations. Under the
terms of the indenture governing the 9% notes, there are restrictions on the
ability of Ply Gem Industries, Inc. to dividend or distribute cash or property
to Ply Gem Holdings. Inc.

To fund a portion of the acquisition of MWM Holding, Inc. on August 27, 2004,
Ply Gem Industries, Inc. entered into a sale and leaseback transaction with net
proceeds of approximately $36.0 million. Due to certain default and exchange
provisions in these leases, sale/leaseback treatment was not achieved, resulting
in violations to our senior credit facilities. The Company requested and
received a waiver from its lenders as it related to our lease agreements in that
these leases would not constitute indebtedness under Ply Gem's credit agreement
for the restriction on indebtedness covenant and any lien in connection with
such leases would not constitute liens for the purposes of the restriction on
liens covenant through April 30, 2005 and only so long as these leases did not
represent more than an aggregate of $36.0 million of financing obligations. At
December 31, 2004 the Company included on its balance sheet an asset financing
obligation of approximately $35.8 million. The lease agreement was amended
effective March 29, 2005 and as of the end of the first quarter, April 2, 2005,
the financing obligation liability and corresponding assets have been removed
from the balance sheet. The initial term of the leases is twenty years with an
option to renew the lease for a ten year period following the initial term.
These leases are net leases and are non-terminable. The basic annual rent is
approximately $3.5 million in the first year with the annual rent being subject
to adjustment for increases in the Consumer Price index upon each anniversary
following the initial basic rent payment date.

The table that follows is a summary of maturities of all of the Company's
long-term debt obligations due in each twelve month period after July 2, 2005:
(AMOUNTS IN THOUSANDS)


                 2005                                           $    1,948
                 2006                                                1,947
                 2007                                                1,947
                 2008                                               25,947
                 2009                                               47,224
                 Thereafter                                        608,452
                                                                ----------
                                                                $  687,465
                                                                ==========

At July 2, 2005, approximately $1.1 million of letters of credit have been
issued under our senior credit facility for the purposes of supporting our
workers compensation plan at one of our subsidiaries. Further, approximately
$3.2 million of letters of credit were issued apart from the senior credit
facility to secure certain environmental obligations.

                                       14
<PAGE>

6.       COMMITMENTS AND CONTINGENCIES


In connection with the Ply Gem Acquisition, Nortek has agreed to indemnify the
Company for certain liabilities as set forth in the Purchase Agreement. In the
event Nortek is unable to satisfy amounts due under these indemnifications then
the Company would be liable. The Company believes that Nortek has the financial
capacity to honor its indemnification obligations and therefore does not
anticipate incurring any losses related to liabilities indemnified by Nortek
under the Purchase Agreement. A receivable related to this indemnification has
been recorded in other long-term assets in the approximate amount of $9.7
million.

The Company has indemnified third parties in certain transactions involving
dispositions of former subsidiaries. As of July 2, 2005 and December 31, 2004,
the Company has recorded liabilities included in Accrued expenses and Other long
term liabilities in relation to these indemnifications of approximately $8.7
million and $13.2 million, respectively, consisting of the following:

                                                         (Amounts in thousands)

                                                      JULY 2, 2005  DEC 31, 2004
                                                      ------------  ------------
  Product claim liabilities                               $  3,805      $  3,813
  Long-term lease liabilities                                  795         5,152
  Multiemployer pension plan withdrawal liability            4,107         4,187
                                                          --------      --------
                                                          $  8,707      $ 13,152
                                                          ========      ========

The long-term lease liabilities of approximately $0.8 million and $5.2 million
at July 2, 2005 and December 31, 2004, respectively, relate to the estimated
amounts to be paid, net of any estimated recoveries where subleases are in
place, primarily in connection with various facility leases where the Company
has retained the liability for the lease agreement in connection with the sale
of certain former subsidiaries that utilized the facilities. Accrued costs
include base rent, additional rent for consumer price index increases as defined
in the leases, taxes, utilities, insurance, repairs and maintenance and, if
applicable, the estimated settlement costs to terminate the leases prior to the
end of their scheduled term. The Company has recorded all long-term lease
liabilities at the undiscounted gross amount expected to be paid to settle the
liabilities in the future.

The Company sells a number of products and offers a number of warranties. The
specific terms and conditions of these warranties vary depending on the product
sold and country in which the product is sold. The Company estimates the costs
that may be incurred under their warranties and records a liability for such
costs at the time of sale, which is recorded in Accrued expenses and Other long
term liabilities. Factors that affect the Company's warranty liabilities include
the number of units sold, historical and anticipated rates of warranty claims,
cost per claim and new product introduction. The Company periodically assesses
the adequacy of the recorded warranty claims and adjusts the amounts as
necessary.

Changes in the Company's warranty liabilities are as follows:

<TABLE>
<CAPTION>
                                               JANUARY 1, 2005   JANUARY 23, 2004     JANUARY 1, 2004
                                                    TO                TO                  TO
                                                JULY 2, 2005       JULY 3, 2004     FEBRUARY 11, 2004
                                                ------------       ------------     -----------------
                                                               (AMOUNTS IN THOUSANDS)
<S>                                               <C>                 <C>              <C>
BALANCE, BEGINNING OF PERIOD                      $  11,095           $  9,491         $  9,499
Warranty expense provided during period               1,429                713              330
Settlements made during period                       (1,527)              (538)            (338)
                                                  ---------           --------         --------
BALANCE, END OF PERIOD                            $  10,997           $  9,666         $  9,491
                                                  =========           ========         ========
</TABLE>


The Company is subject to other contingencies, including legal proceedings and
claims arising out of its businesses that cover a wide range of matters,
including, among others, environmental matters, contract and employment claims,
product liability, warranty and modification, adjustment or replacement of
component parts of units sold, which may include product recalls. Product
liability, environmental and

                                       15
<PAGE>

other legal proceedings also include matters with respect to businesses
previously owned. The Company has used various substances in their products and
manufacturing operations, which have been or may be deemed to be hazardous or
dangerous, and the extent of its potential liability, if any, under
environmental, product liability and workers' compensation statutes, rules,
regulations and case law is unclear. Further, due to the lack of adequate
information and the potential impact of present regulations and any future
regulations, there are certain circumstances in which no range of potential
exposure may be reasonably estimated.

As of July 2, 2005, the Company has accrued approximately $0.8 million in
Accrued expenses to cover the estimated costs of known litigation claims,
including the estimated cost of legal services, that the Company is contesting
including certain employment and former shareholder litigation related to the
Company.

It is impossible to ascertain the ultimate legal and financial liability with
respect to contingent liabilities, including lawsuits, and therefore no such
estimate has been made.


7.       ACCRUED EXPENSES, TAXES,  AND OTHER LONG-TERM LIABILITIES

Accrued expenses and taxes consist of the following at July 2, 2005 and December
31, 2004:

                                               JULY 2, 2005    DECEMBER 31, 2004
                                               ------------    -----------------
                                                     (AMOUNTS IN THOUSANDS)

  Insurance                                      $    5,384         $    4,460
  Employee compensation and benefits                 12,844             12,730
  Sales and marketing                                12,551             14,396
  Product warranty                                    3,762              4,040
  Short-term product claim liability                  2,321              2,321
  Interest                                           12,601             12,134
  Other, net                                         13,274             11,863
                                                 ----------         ----------
                                                 $   62,737         $   61,944
                                                 ==========         ==========

Other long-term liabilities consist of
 the following at July 2, 2005 and
December 31, 2004:

                                               JULY 2, 2005    DECEMBER 31, 2004
                                               ------------    -----------------
                                                     (AMOUNTS IN THOUSANDS)

  Insurance                                      $    3,492         $    3,597
  Pension liabilities                                13,471             14,454
  Product warranty                                    7,235              7,055
  Long-term lease liabilities                           795              5,152
  Long-term product claim liability                   1,484              1,492
  Other                                                 991                651
                                                 ----------         ----------
                                                 $   27,468         $   32,401
                                                 ==========         ==========


8.       SEGMENT INFORMATION

Statement of Financial Accounting Standards No. 131, "DISCLOSURES ABOUT SEGMENTS
OF AN ENTERPRISE AND RELATED INFORMATION" (SFAS 131) requires companies to
report certain information about operating segments in their financial
statements and established standards for related disclosures about products and
services, geographic areas and major customers. SFAS 131 defines operating
segments as components of an enterprise about which separate financial
information is available that is evaluated regularly by management in deciding
how to allocate resources and in assessing performance. Operating segments
meeting certain aggregation criteria may be combined into one reportable segment

                                       16
<PAGE>

for disclosure purposes. Comparative information for prior years is presented to
conform to our current organizational structure.

The Company has two reportable segments: 1) vinyl siding, fencing, railing, and
decking and 2) windows and doors.

The income (loss) from continuing operations before income taxes of each segment
includes the revenue generated on transactions involving products within that
segment less identifiable expenses. Unallocated income and expenses include
items which are not directly attributed to or allocated to either of our
reporting segments. Such items include interest, legal costs, corporate payroll,
and unallocated finance and accounting expenses. Unallocated corporate assets
include deferred financing costs, cash and certain non-operating receivables.

Following is a summary of the Company's segment information.

<TABLE>
<CAPTION>
FOR THE  THREE MONTHS ENDED              SIDING, FENCING,
JULY 2, 2005                               RAILING AND       WINDOWS
(AMOUNTS IN THOUSANDS)                       DECKING        AND DOORS       UNALLOCATED       CONSOLIDATED
                                             -------        ---------       -----------       ------------
<S>                                        <C>             <C>                <C>              <C>
Net sales                                  $  110,180      $  120,123         $      --        $  230,303

Income (loss) before income taxes              15,335          14,750           (14,919)           15,166

Total assets                                  504,511         539,265            69,061         1,112,837


FOR THE  THREE MONTHS ENDED              SIDING, FENCING,
JULY 3, 2004                               RAILING AND       WINDOWS
(AMOUNTS IN THOUSANDS)                       DECKING        AND DOORS       UNALLOCATED       CONSOLIDATED
                                             -------        ---------       -----------       ------------
Net sales                                  $  111,926       $  41,099         $      --        $  153,025

Income (loss) before income taxes              17,665           5,473            (8,446)            14,692

Total assets                                  551,211         147,330            41,323           739,864


FOR THE PERIOD FROM                      SIDING, FENCING,
JANUARY 1, 2005 TO JULY 2, 2005            RAILING AND       WINDOWS
(AMOUNTS IN THOUSANDS)                       DECKING        AND DOORS       UNALLOCATED       CONSOLIDATED
                                             -------        ---------       -----------       ------------
Net sales                                  $  189,028      $  213,010         $      --        $  402,038

Income (loss) before income taxes              18,693          20,058           (29,925)            8,826

Total assets                                  504,511         539,265            69,061         1,112,837


FOR THE PERIOD FROM                      SIDING, FENCING,
JANUARY 23, 2004 TO JULY 3, 2004           RAILING AND       WINDOWS
(AMOUNTS IN THOUSANDS)                       DECKING        AND DOORS       UNALLOCATED       CONSOLIDATED
                                             -------        ---------       -----------       ------------
Net sales                                  $  165,655      $   60,120         $      --        $  225,775

Income (loss) before income taxes              23,620           6,689           (15,469)           14,840

Total assets                                  551,211         147,330            41,323           739,864
</TABLE>

                                       17
<PAGE>

<TABLE>
<CAPTION>
FOR THE PERIOD FROM
JANUARY 1, 2004 TO                       SIDING, FENCING,
FEBRUARY 11, 2004                          RAILING AND       WINDOWS
(AMOUNTS IN THOUSANDS)                       DECKING        AND DOORS       UNALLOCATED       CONSOLIDATED
                                             -------        ---------       -----------       ------------
<S>                                        <C>             <C>                <C>              <C>
Net sales                                  $   29,546      $   11,066         $      --        $   40,612

Loss before income taxes                      (3,010)         (1,537)              (653)           (5,200)

Total assets                                  487,676          51,881           (45,943)          493,614
</TABLE>


9.   SUBSEQUENT EVENTS

On July 25, 2005, the Company entered into an amendment to its credit facility.
Under the terms of the amended agreement, the Company will be permitted to use
its excess cash flow and/or a portion of its revolving credit facility to
repurchase up to $25.0 million aggregate principal amount of the Company's 9%
senior subordinated notes due 2012. Subject to market conditions, its capital
needs and other factors, the Company may from time to time purchase up to $25.0
million aggregate principal amount of its 9% senior subordinated notes due 2012
in market transactions, privately negotiated sales or other transactions.


18
<PAGE>

10.  GUARANTOR / NON-GUARANTOR

In connection with the financing of the Ply Gem Acquisition, Ply Gem Industries,
Inc. sold $225 million of its 9% senior subordinated notes due 2012 and entered
into $255 million of new senior credit facilities. As a result of the MW
Acquisition, an additional $135 million of senior subordinated notes were
issued, and the size of the credit facilities was increased by $126 million. The
senior subordinated notes due 2012 are secured by full and unconditional
guarantees on a joint and several basis from certain of the Company's 100% owned
subsidiaries. Accordingly, the following guarantor and non-guarantor information
is presented as of July 2, 2005 and for the periods from January 1, 2005 to July
2, 2005, January 1, 2004 to February 11, 2004, and January 23, 2004 to July 3,
2004. The non-guarantor information presented represents our Canadian
subsidiary.

<TABLE>
<CAPTION>
                                                        PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
                                                     CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
                                                     FOR THE THREE MONTH PERIOD ENDED JULY 2, 2005

                                   GUARANTOR       ISSUER
                                    PLY GEM        PLY GEM                        NON-
                                    HOLDINGS,    INDUSTRIES,     GUARANTOR      GUARANTOR
                                      INC.           INC.       SUBSIDIARIES    SUBSIDIARY    ELIMINATIONS  CONSOLIDATED
                                      ----           ----       ------------    ----------    ------------  ------------
                                                                 (Amounts in thousands)
<S>                                <C>            <C>             <C>           <C>            <C>            <C>
Net Sales........................  $    --        $     --        $ 215,232     $   15,071     $       --     $ 230,303
Costs and Expenses:
Cost of products sold ...........       --              --          164,561         10,281             --       174,842
Selling, general and
    administrative expense ......       --           1,599           19,615          2,478             --        23,692
Intercompany administrative
    charges......................       --          (8,610)           8,610             --             --            --
Amortization of intangible assets       --              --            2,441             --             --         2,441
                                   -------        --------        ---------     ----------     ----------     ---------
                                        --          (7,011)         195,227         12,759             --       200,975
                                   -------        --------        ---------     ----------     ----------     ---------
Operating earnings ..............       --           7,011           20,005          2,312             --        29,328
Foreign currency loss ...........       --              --               --           (233)            --          (233)
Interest expense, net............       --         (13,382)             (98)          (593)            --       (14,073)
Investment income................       --              64               67             13             --           144
                                   -------        --------        ---------     ----------     ----------     ---------
Income (loss) before equity in
   subsidiaries' income..........       --          (6,307)          19,974          1,499             --        15,166
Equity in subsidiaries' income...    9,108          12,892               --             --        (22,000)           --
                                   -------        --------        ---------     ----------     ----------     ---------
Income before provision
   (benefit) for income taxes....    9,108           6,585           19,974          1,499        (22,000)       15,166
Provision (benefit) for income
   taxes.........................       --          (2,523)           8,062            519             --         6,058
                                   -------        --------        ---------     ----------     ----------     ---------
Net income.......................  $ 9,108        $  9,108        $  11,912     $      980     $  (22,000)    $   9,108
                                   =======        ========        =========     ==========     ==========     =========
</TABLE>

                                       19
<PAGE>

<TABLE>
<CAPTION>
                                                     PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
                                                 CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
                                                  FOR THE THREE MONTH PERIOD ENDED JULY 3, 2004

                                   GUARANTOR       ISSUER
                                    PLY GEM        PLY GEM                         NON-
                                  HOLDINGS,     INDUSTRIES,     GUARANTOR       GUARANTOR
                                     INC.           INC.       SUBSIDIARIES     SUBSIDIARY    ELIMINATIONS   CONSOLIDATED
                                     ----           ----       ------------     ----------    ------------   ------------
                                                                 (Amounts in thousands)
<S>                                <C>            <C>             <C>           <C>            <C>            <C>
Net Sales........................  $    --        $     --        $ 140,786     $   12,239     $       --     $ 153,025
Costs and Expenses:
Cost of products sold ...........       --              --          105,282          8,064             --       113,346
Selling, general and
    administrative expense ......       --           1,012           13,242          2,132             --        16,386
Intercompany administrative
    charges......................       --          (8,540)           8,540             --             --            --
Amortization of intangible assets       --              --              625             --             --           625
                                   -------        --------        ---------     ----------     ----------     ---------
                                        --          (7,528)         127,689         10,196             --       130,357
                                   -------        --------        ---------     ----------     ----------     ---------
Operating earnings ..............       --           7,528           13,097          2,043             --        22,668
Interest expense, net............       --          (7,663)             601           (945)            --        (8,007)
Investment income................       --              --               31             --             --            31
                                   -------        --------        ---------     ----------     ----------     ---------
Income (loss) before equity in
   subsidiaries' income..........       --            (135)          13,729          1,098             --        14,692
Equity in subsidiaries' income...    9,142           9,223               --             --        (18,365)           --
                                   -------        --------        ---------     ----------     ----------     ---------
Income before provision
   (benefit) for income taxes....    9,142           9,088           13,729          1,098        (18,365)       14,692
Provision (benefit) for income
   taxes.........................       --             (54)           5,165            439             --          5,550
                                   -------        --------        ---------     ----------     ----------     ---------
Net income.......................  $ 9,142        $  9,142        $   8,564     $      659     $  (18,365)    $   9,142
                                   =======        ========        =========     ==========     ==========     =========
</TABLE>

                                       20
<PAGE>

<TABLE>
<CAPTION>
                                                     PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
                                                 CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
                                               FOR THE PERIOD FROM JANUARY 1, 2005 TO JULY 2, 2005

                                   GUARANTOR       ISSUER
                                    PLY GEM        PLY GEM                         NON-
                                  HOLDINGS,     INDUSTRIES,     GUARANTOR       GUARANTOR
                                     INC.           INC.       SUBSIDIARIES     SUBSIDIARY    ELIMINATIONS   CONSOLIDATED
                                     ----           ----       ------------     ----------    ------------   ------------
                                                                 (Amounts in thousands)
<S>                                <C>            <C>             <C>           <C>            <C>            <C>
Net Sales........................  $     -        $      -        $ 376,368     $   25,670     $        -     $ 402,038
Costs and Expenses:
Cost of products sold ...........        -               -          294,611         17,997              -       312,608
Selling, general and
    administrative expense.......        -           2,893           39,008          4,833              -        46,734
Intercompany administrative
    charges......................        -         (15,058)          15,058              -              -             -
Amortization of intangible assets        -               -            4,881              -              -         4,881
                                   -------        --------        ---------     ----------     ----------     ---------
                                         -         (12,165)         353,558         22,830              -       364,223
                                   -------        --------        ---------     ----------     ----------     ---------
Operating earnings ..............        -          12,165           22,810          2,840              -        37,815
Foreign currency loss............        -               -                -           (537)             -          (537)
Interest expense, net............        -         (26,563)            (957)        (1,155)             -       (28,675)
Investment income................        -              89              118             16              -           223
                                   -------        --------        ---------     ----------     ----------     ---------
Income (loss) before equity in
   subsidiaries' income..........        -         (14,309)          21,971          1,164              -         8,826
Equity in subsidiaries' income...    5,253          13,838                -              -        (19,091)            -
                                   -------        --------        ---------     ----------     ----------     ---------
Income (loss) before provision
   (benefit) for income taxes....    5,253            (471)          21,971          1,164        (19,091)        8,826
Provision (benefit) for income
   taxes.........................        -          (5,724)           8,901            396              -         3,573
                                   -------        --------        ---------     ----------     ----------     ---------
Net income (loss)................  $ 5,253        $  5,253        $  13,070     $      768     $  (19,091)    $   5,253
                                   =======        ========        =========     ==========     ==========     =========
</TABLE>

                                       21
<PAGE>

<TABLE>
<CAPTION>
                                                      PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
                                                    CONDENSED COMBINED STATEMENT OF OPERATIONS
                                             FOR THE PERIOD FROM JANUARY 1, 2004 TO FEBRUARY 11, 2004

                                           ISSUER
                                          PLY GEM                           NON-
                                        INDUSTRIES,      GUARANTOR       GUARANTOR
                                            INC.        SUBSIDIARIES     SUBSIDIARY     ELIMINATIONS      COMBINED
                                            ----        ------------     ----------     ------------      --------
                                                                   (Amounts in thousands)
<S>                                       <C>            <C>             <C>              <C>            <C>
Net Sales.............................    $     --       $  37,187       $   3,425        $      --      $  40,612
Costs and Expenses:
Cost of products sold ................          --          30,991           2,620               --         33,611
Selling, general and
    administrative expense ...........         561           6,552           1,232               --          8,345
Intercompany administrative
    charges...........................      (3,166)          3,166              --               --             --
Amortization of intangible assets               --             201              --               --            201
                                          --------       ---------       ---------        ---------      ---------
                                            (2,605)         40,910           3,852               --         42,157
                                          --------       ---------       ---------        ---------      ---------
Operating earnings (loss).............       2,605          (3,723)           (427)              --         (1,545)
Interest expense, net.................         (39)         (3,645)             --               --         (3,684)
Investment income.....................          --              18              11               --             29
                                          --------       ---------       ---------        ---------      ---------
Income (loss) before equity in
   subsidiaries' (loss) ..............       2,566          (7,350)           (416)              --         (5,200)
Equity in subsidiaries' loss..........      (5,667)             --              --            5,667             --
                                          --------       ---------       ---------        ---------      ---------
Loss before benefit for income
   taxes..............................      (3,101)         (7,350)           (416)           5,667         (5,200)
Benefit for income taxes..............          --          (1,683)           (167)              --         (1,850)
                                          --------       ---------       ---------        ---------      ---------
Net loss .............................    $ (3,101)      $  (5,667)      $    (249)       $   5,667      $  (3,350)
                                          ========       =========       =========        =========      =========
</TABLE>

                                       22
<PAGE>

<TABLE>
<CAPTION>
                                                        PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
                                                    CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
                                                 FOR THE PERIOD FROM JANUARY 23, 2004 TO JULY 3, 2004

                                   GUARANTOR       ISSUER
                                    PLY GEM        PLY GEM                         NON-
                                  HOLDINGS,     INDUSTRIES,     GUARANTOR       GUARANTOR
                                     INC.           INC.       SUBSIDIARIES     SUBSIDIARY    ELIMINATIONS   CONSOLIDATED
                                     ----           ----       ------------     ----------    ------------   ------------
                                                                 (Amounts in thousands)
<S>                                <C>            <C>             <C>           <C>            <C>            <C>
Net Sales........................  $    --        $     --        $ 207,817     $   17,958     $       --     $ 225,775
Costs and Expenses:
Cost of products sold ...........       --              --          159,095         12,120             --       171,215
Selling, general and
    administrative expense ......       --           1,643           20,879          3,168             --        25,690
Intercompany administrative
    charges......................       --          (8,620)           8,620             --             --            --
Amortization of intangible assets       --               8            1,018             --             --         1,026
                                   -------        --------        ---------     ----------     ----------     ---------
                                        --          (6,969)         189,612         15,288             --       197,931
                                   -------        --------        ---------     ----------     ----------     ---------
Operating earnings ..............       --           6,969           18,205          2,670             --        27,844
Interest expense, net............       --         (11,547)            (532)          (945)            --       (13,024)
Investment income................       --              --               20             --             --            20
                                   -------        --------        ---------     ----------     ----------     ---------
Income (loss) before equity in
   subsidiaries' income..........       --          (4,578)          17,693          1,725             --        14,840
Equity in subsidiaries' income...    9,201          11,876               --             --        (21,077)           --
                                   -------        --------        ---------     ----------     ----------     ---------
Income before provision
   (benefit) for income taxes....    9,201           7,298           17,693          1,725        (21,077)       14,840
Provision (benefit) for income
   taxes.........................       --          (1,903)           6,852            690             --         5,639
                                   -------        --------        ---------     ----------     ----------     ---------
Net loss ........................  $ 9,201        $  9,201        $  10,841     $    1,035     $  (21,077)    $   9,201
                                   =======        ========        =========     ==========     ==========     =========
</TABLE>

                                       23
<PAGE>

<TABLE>
<CAPTION>
                                        PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
                                          CONDENSED CONSOLIDATED BALANCE SHEET
                                                   AS OF JULY 2, 2005

                                   GUARANTOR       ISSUER
                                    PLY GEM        PLY GEM                         NON-
                                  HOLDINGS,     INDUSTRIES,     GUARANTOR       GUARANTOR
                                     INC.           INC.       SUBSIDIARIES     SUBSIDIARY    ELIMINATIONS   CONSOLIDATED
                                     ----           ----       ------------     ----------    ------------   ------------
                                                                 (Amounts in thousands)
<S>                                <C>            <C>             <C>           <C>            <C>            <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents......    $      --     $   16,881       $   5,512     $    4,214     $        --    $    26,607
Accounts receivable, net.........         --             --          87,674          7,542              --         95,216
Inventories:
   Raw materials.................         --             --          35,300          2,607              --         37,907
   Work in process...............         --             --           3,233          1,263              --          4,496

   Finished goods................         --             --          24,169          1,877              --         26,046
                                   ---------     ----------       ---------     ----------     -----------    -----------
   Total inventory...............         --             --          62,702          5,747              --         68,449
Prepaid expenses and other
   current assets................         --          2,791           9,123            548              --         12,462

Deferred income taxes............         --             --          19,213             --              --         19,213
                                   ---------     ----------       ---------     ----------     -----------    -----------
     Total current assets........         --         19,672         184,224         18,051              --        221,947
Investments in subsidiaries......    200,184        821,761              --             --      (1,021,945)            --
PROPERTY AND EQUIPMENT, AT
COST:
Land.............................         --             --           1,870            143              --          2,013
Buildings and improvements.......         --            136          14,563            583              --         15,282
Machinery and equipment..........         --             30         107,337          2,457              --        109,824
                                   ---------     ----------       ---------     ----------     -----------    -----------
                                          --            166         123,770          3,183              --        127,119
Less accumulated depreciation ...         --            (24)        (18,250)          (556)             --        (18,830)
                                   ---------     ----------       ---------     ----------     -----------    -----------
Total property and equipment,
   net...........................         --            142         105,520          2,627              --        108,289
OTHER ASSETS:
Goodwill.........................         --             --         545,255         38,526              --        583,781
Intangible assets, net...........         --             --         157,771             --              --        157,771
Intercompany note receivable.....         --         11,746              --             --         (11,746)            --
Other............................         --         40,864             185             --              --         41,049
                                   ---------     ----------       ---------     ----------     -----------    -----------
    Total other assets...........         --         52,610         703,211         38,526         (11,746)       782,601
                                   ---------     ----------       ---------     ----------     -----------    -----------
                                   $ 200,184     $  894,185       $ 992,955     $   59,204     $(1,033,691)   $ 1,112,837
                                   =========     ==========       =========     ==========     ===========    ===========

LIABILITIES AND STOCKHOLDER'S EQUITY
CURRENT LIABILITIES:
Current maturities of long-term
   debt..........................  $      --     $    1,698       $      --     $      250     $        --    $     1,948
Accounts payable.................         --            247          57,926          5,019              --         63,192
Accrued expenses and taxes.......         --         17,418          43,306          2,013              --         62,737
                                   ---------     ----------       ---------     ----------     -----------    -----------
     Total current liabilities...         --         19,363         101,232          7,282              --        127,877
Deferred income taxes............         --             --          71,021            770              --         71,791
Intercompany note payable........         --             --              --         11,746         (11,746)            --
Other long term liabilities......         --         13,509          13,075            884              --         27,468
Long-term debt, less current
   maturities....................         --        661,129              --         24,388              --        685,517
STOCKHOLDER'S EQUITY:
Preferred stock..................         --             --              --             --              --             --
Common stock.....................         --             --              --             --              --             --
Additional paid-in-capital.......    175,277        175,277         777,103          5,891        (958,271)       175,277
Retained earnings................     22,936         22,936          30,784          6,012         (59,732)        22,936
Accumulated other
   comprehensive income (loss)...      1,971          1,971            (260)         2,231          (3,942)         1,971
                                   ---------     ----------       ---------     ----------     -----------    -----------
                                   $ 200,184     $  894,185       $ 992,955     $   59,204     $(1,033,691)   $ 1,112,837
                                   =========     ==========       =========     ==========     ===========    ===========
</TABLE>
                                       24
<PAGE>

                     PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEET
                             AS OF DECEMBER 31, 2004

<TABLE>
<CAPTION>
                                             GUARANTOR      ISSUER
                                              PLY GEM      PLY GEM                         NON-
                                             HOLDINGS,   INDUSTRIES,     GUARANTOR      GUARANTOR
                                                INC.         INC.       SUBSIDIARIES    SUBSIDIARY   ELIMINATIONS   CONSOLIDATED
                                            ----------   -----------    -----------     ----------   ------------   ------------
                                                                          (Amounts in thousands)

<S>                                         <C>           <C>            <C>            <C>           <C>             <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents ..............    $       --    $    1,923     $    3,483     $    1,388    $        --     $    6,794
Accounts receivable, net ...............            --            --         59,855          5,362             --         65,217

Inventories:
   Raw materials .......................            --            --         27,555          2,950             --         30,505
   Work in process .....................            --            --          3,389            871             --          4,260
   Finished goods ......................            --            --         25,186          1,545             --         26,731
                                            ----------    ----------     ----------     ----------    -----------     ----------
   Total inventory .....................            --            --         56,130          5,366             --         61,496

Prepaid expenses and other
   current assets ......................            --         1,004          8,169            623             --          9,796
Deferred income taxes ..................            --            --         18,356             --             --         18,356
                                            ----------    ----------     ----------     ----------    -----------     ----------
     Total current assets ..............            --         2,927        145,993         12,739             --        161,659

Investments in subsidiaries ............       195,407       810,462             --             --     (1,005,869)            --

PROPERTY AND EQUIPMENT, AT
COST:
Land ...................................            --            --          4,908          2,349             --          7,257
Buildings and improvements .............            --            --         42,648          3,843             --         46,491
Machinery and equipment ................            --           158        102,738          2,266             --        105,162
                                            ----------    ----------     ----------     ----------    -----------     ----------
                                                    --           158        150,294          8,458             --        158,910
Less accumulated depreciation ..........            --           (15)       (11,372)          (487)            --        (11,874)
                                            ----------    ----------     ----------     ----------    -----------     ----------

Total property and equipment, net ......            --           143        138,922          7,971             --        147,036

OTHER ASSETS:
Goodwill ...............................            --            --        541,730         43,420             --        585,150
Intangible assets, net .................            --            --        162,657             --             --        162,657
Intercompany note receivable ...........            --         9,346             --             --         (9,346)            --
Other ..................................            --        47,669            128             --             --         47,797
                                            ----------    ----------     ----------     ----------    -----------     ----------
    Total other assets .................            --        57,015        704,515         43,420         (9,346)       795,604
                                            ----------    ----------     ----------     ----------    -----------     ----------
                                            $  195,407    $  870,547     $  989,430     $   64,130    $(1,015,215)    $1,104,299
                                            ==========    ==========     ==========     ==========    ===========     ==========

LIABILITIES AND STOCKHOLDER'S EQUITY
CURRENT LIABILITIES:
Current maturities of long-term debt ...            --         1,700            834            250             --          2,784
Accounts payable .......................            --            --         32,885          1,715             --         34,600
Accrued expenses and taxes .............            --        17,125         40,232          4,587             --         61,944
                                            ----------    ----------     ----------     ----------    -----------     ----------
     Total current liabilities .........            --        18,825         73,951          6,552             --         99,328

Deferred income taxes ..................            --            --         71,463            893             --         72,356
Intercompany note payable ..............            --            --             --          9,346         (9,346)            --
Other long term liabilities ............            --        17,969         13,531            901             --         32,401
Long-term debt, less current
   maturities ..........................            --       638,346         36,515         29,946             --        704,807

STOCKHOLDER'S EQUITY:
Preferred stock ........................            --            --             --             --             --             --
Common stock ...........................            --            --             --             --             --             --
Additional paid-in-capital .............       175,427       175,427        767,338          9,205       (951,970)       175,427
Retained earnings ......................        17,682        17,682         26,892          4,729        (49,303)        17,682
Accumulated other
   comprehensive income (loss) .........         2,298         2,298           (260)         2,558         (4,596)         2,298
                                            ----------    ----------     ----------     ----------    -----------     ----------
                                            $  195,407    $  870,547     $  989,430     $   64,130    $(1,015,215)    $1,104,299
                                            ==========    ==========     ==========     ==========    ===========     ==========
</TABLE>

                                       25
<PAGE>

                     PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
                      CONSOLIDATING STATEMENT OF CASH FLOWS
               FOR THE PERIOD FROM JANUARY 1, 2005 TO JULY 2, 2005

<TABLE>
<CAPTION>
                                               GUARANTOR       ISSUER
                                                PLY GEM       PLY GEM                         NON-
                                               HOLDINGS,     INDUSTRIES,    GUARANTOR      GUARANTOR
                                                  INC.           INC.      SUBSIDIARIES    SUBSIDIARY   ELIMINATIONS   CONSOLIDATED
                                               ---------     -----------   ------------    ----------   ------------   ------------
                                                                              (Amounts in thousands)

<S>                                            <C>           <C>            <C>            <C>            <C>            <C>
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income (loss) ...........................  $   5,253     $   5,253      $  13,070      $     768      $ (19,091)     $   5,253

ADJUSTMENTS TO RECONCILE NET
INCOME (LOSS) TO CASH PROVIDED BY
(USED IN) OPERATING ACTIVITIES:

Depreciation and amortization expense .......         --             9         12,775            221             --         13,005
Non-cash interest expense, net ..............         --         2,377             --             --             --          2,377
Loss on foreign currency transaction ........         --            --             --            537             --            537
Deferred income taxes .......................         --         3,576         (5,342)           362             --         (1,404)
Equity in subsidiaries' net income ..........     (5,253)      (13,838)            --             --         19,091             --

CHANGES IN OPERATING ASSETS AND LIABILITIES:

Accounts receivable, net ....................         --            --        (27,819)        (2,254)            --        (30,073)
Inventories .................................         --            --         (6,572)          (478)            --         (7,050)
Prepaid expenses and other current assets ...         --        (1,790)          (508)            88             --         (2,210)
Accounts payable ............................         --            --         25,282          3,303             --         28,585
Accrued expenses and taxes ..................         --          (108)         2,555         (2,469)            --            (22)
Other .......................................         --          (767)            (2)           799             --             30
                                               ---------     ---------      ---------      ---------      ---------      ---------

    NET CASH PROVIDED BY (USED IN)
    OPERATING ACTIVITIES ....................         --        (5,288)        13,439            877             --          9,028

CASH FLOWS USED IN INVESTING ACTIVITIES:

Capital expenditures ........................         --            (8)        (4,831)          (321)            --         (5,160)
Acquisitions, net of cash acquired ..........         --            --            482             --             --            482
                                               ---------     ---------      ---------      ---------      ---------      ---------

    NET CASH USED IN
    INVESTING ACTIVITIES ....................         --            (8)        (4,349)          (321)            --         (4,678)

CASH FLOWS PROVIDED BY FINANCING ACTIVITIES:

Proceeds from long-term debt ................         --        35,500             --             --             --         35,500
Proceeds from intercompany investment .......         --        (2,400)            --          2,400             --             --
Payments on long-term debt ..................         --       (12,696)        (7,061)          (137)            --        (19,894)
Return of equity contribution ...............         --          (150)            --             --             --           (150)
                                               ---------     ---------      ---------      ---------      ---------      ---------

    NET CASH PROVIDED BY (USED IN)
    FINANCING ACTIVITIES ....................         --        20,254         (7,061)         2,263             --         15,456

Impact of exchange rate movement on cash ....         --            --             --              7             --              7
                                               ---------     ---------      ---------      ---------      ---------      ---------
Net increase (decrease) in cash and
    cash equivalents ........................         --        14,958          2,029          2,826             --         19,813
Cash and cash equivalents at the
    beginning of the period .................         --         1,923          3,483          1,388             --          6,794
                                               ---------     ---------      ---------      ---------      ---------      ---------
Cash and cash equivalents at the end
    of the period ...........................  $      --     $  16,881      $   5,512      $   4,214      $      --      $  26,607
                                               =========     =========      =========      =========      =========      =========
</TABLE>

                                       26
<PAGE>

                     PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
                        COMBINING STATEMENT OF CASH FLOWS
            FOR THE PERIOD FROM JANUARY 1, 2004 TO FEBRUARY 11, 2004

<TABLE>
<CAPTION>
                                                           ISSUER
                                                          PLY GEM                           NON-
                                                         INDUSTRIES,     GUARANTOR       GUARANTOR
                                                             INC.       SUBSIDIARIES     SUBSIDIARY     ELIMINATIONS   COMBINED
                                                         ----------     -----------      ----------     ------------   --------
                                                                                 (Amounts in thousands)

<S>                                                       <C>            <C>            <C>            <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss .............................................    $  (3,101)     $  (5,667)     $    (249)     $   5,667      $  (3,350)

ADJUSTMENTS TO RECONCILE NET
LOSS TO CASH PROVIDED BY
(USED IN) OPERATING ACTIVITIES:

Depreciation and amortization expense ................           39          1,243             91             --          1,373
Non-cash interest expense, net .......................           --             26             --             --             26
Deferred income taxes ................................       (5,630)         3,920             --             --         (1,710)
Equity in subsidiaries ...............................        5,667             --             --         (5,667)            --

CHANGES IN OPERATING  ASSETS AND LIABILITIES:

Accounts receivable, net .............................           --            546          1,323             --          1,869
Inventories ..........................................           --         (2,742)          (482)            --         (3,224)
Prepaid expenses and other current assets ............          (45)          (185)           (30)            --           (260)
Accounts payable .....................................          (27)         8,194           (402)            --          7,765
Accrued expenses and taxes ...........................         (820)         1,287         (1,806)            --         (1,339)
Other ................................................           --            498             --             --            498
                                                          ---------      ---------      ---------      ---------      ---------
    NET CASH PROVIDED BY (USED IN)
    OPERATING ACTIVITIES .............................       (3,917)         7,120         (1,555)            --          1,648

CASH FLOWS PROVIDED BY (USED IN)
INVESTING ACTIVITIES:

Capital expenditures .................................           --           (702)           (16)            --           (718)
Change in restricted cash ............................           --          1,118             --             --          1,118
Other ................................................           --              1             (6)            --             (5)
                                                          ---------      ---------      ---------      ---------      ---------
    NET CASH PROVIDED BY (USED IN)
    INVESTING ACTIVITIES .............................           --            417            (22)            --            395

CASH FLOWS USED IN FINANCING ACTIVITIES:

Payments on long-term debt ...........................          (35)           (54)            --             --            (89)
Net transfers to former parent .......................           --         (7,286)           (76)            --         (7,362)
                                                          ---------      ---------      ---------      ---------      ---------

    NET CASH USED IN FINANCING ACTIVITIES ............          (35)        (7,340)           (76)            --         (7,451)

Net increase (decrease) in cash and cash equivalents..       (3,952)           197         (1,653)            --         (5,408)
Cash and cash equivalents at the beginning of
    the period .......................................        3,851          2,255          2,411             --          8,517
                                                          ---------      ---------      ---------      ---------      ---------
Cash and cash equivalents at the end
    of the period ....................................    $    (101)     $   2,452      $     758      $      --      $   3,109
                                                          =========      =========      =========      =========      =========
</TABLE>

                                       27
<PAGE>

                     PLY GEM HOLDINGS, INC. AND SUBSIDIARIES
                      CONSOLIDATING STATEMENT OF CASH FLOWS
              FOR THE PERIOD FROM JANUARY 23, 2004 TO JULY 3, 2004

<TABLE>
<CAPTION>
                                                  GUARANTOR       ISSUER
                                                   PLY GEM       PLY GEM                        NON-
                                                  HOLDINGS,     INDUSTRIES,    GUARANTOR     GUARANTOR
                                                     INC.           INC.      SUBSIDIARIES   SUBSIDIARY  ELIMINATIONS  CONSOLIDATED
                                                  ---------     -----------   ------------   ----------  ------------  ------------
                                                                              (Amounts in thousands)
<S>                                               <C>           <C>           <C>           <C>           <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income .....................................  $   9,201     $   9,201     $  10,841     $   1,035     $ (21,077)    $   9,201

ADJUSTMENTS TO RECONCILE NET
INCOME TO CASH PROVIDED BY
(USED IN) OPERATING ACTIVITIES:

Depreciation and amortization expense ..........         --            89         4,842           286            --         5,217
Write off of inventory .........................         --            --         1,974            --            --         1,974
Non-cash interest expense, net .................         --           894          (892)           --            --             2
Deferred income taxes ..........................         --        (1,903)        1,903            --            --            --
Equity in subsidiaries' net income .............     (9,201)      (11,876)           --            --        21,077            --

CHANGES IN OPERATING ASSETS AND LIABILITIES

Accounts receivable, net .......................         --            --       (24,662)       (2,006)           --       (26,668)
Inventories ....................................         --            --         3,292          (175)           --         3,117
Prepaid expenses and other current assets ......         --            16          (636)         (122)           --          (742)
Accounts payable ...............................         --            --           740         1,809            --         2,549
Accrued expenses and taxes .....................         --         1,419        10,065         1,502            --        12,986
Other ..........................................         --          (101)        1,591            45            --         1,535
                                                  ---------     ---------     ---------     ---------     ---------     ---------
    NET CASH PROVIDED BY (USED IN)
    OPERATING ACTIVITIES .......................         --        (2,261)        9,058         2,374            --         9,171

CASH FLOWS USED IN INVESTING ACTIVITIES:

Capital expenditures ...........................         --           (76)       (2,107)         (187)           --        (2,370)
Payment for acquisitions, net of cash acquired .         --      (552,196)           --            --            --      (552,196)
                                                  ---------     ---------     ---------     ---------     ---------     ---------

    NET CASH USED IN INVESTING ACTIVITIES ......         --      (552,272)       (2,107)         (187)           --      (554,566)

CASH FLOWS PROVIDED BY (USED IN)
FINANCING ACTIVITIES:

Proceeds from long-term debt ...................         --       404,000            --        30,000            --       434,000
Transfers with subsidiaries ....................         --        18,779        11,221       (30,000)           --            --
Payments on long-term debt .....................         --          (644)      (13,790)          (75)           --       (14,509)
Equity contribution ............................         --       136,725            --            --            --       136,725
                                                  ---------     ---------     ---------     ---------     ---------     ---------
    NET CASH PROVIDED BY (USED IN)
    FINANCING ACTIVITIES .......................         --       558,860        (2,569)          (75)           --       556,216

Net increase (decrease) in cash
    and cash equivalents .......................         --         4,327         4,382         2,112            --        10,821
Cash and cash equivalents at the
    beginning of the period ....................         --            --            --            --            --            --
                                                  ---------     ---------     ---------     ---------     ---------     ---------
Cash and cash equivalents at the end
    of the period ..............................  $      --     $   4,327     $   4,382     $   2,112     $      --     $  10,821
                                                  =========     =========     =========     =========     =========     =========
</TABLE>

                                       28
<PAGE>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS


The information contained in this discussion and in the unaudited Condensed
Consolidated and Combined Financial Statements and Accompanying Notes presented
in this Form 10-Q should be read in conjunction with information set forth in
Ply Gem Holdings, Inc.'s Annual Report on Form 10-K. Certain statements in this
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" are "forward-looking statements." See "Special Note Regarding
Forward-Looking Statements."

GENERAL

We are a leading manufacturer of residential exterior building products in North
America. We offer a comprehensive product line of vinyl siding and skirting,
vinyl windows and doors, and vinyl and composite fencing, railing and decking
that serves both the home repair and remodeling and new home construction
sectors in all 50 states and Western Canada. We also manufacture vinyl and
aluminum soffit and siding accessories, aluminum trim coil, wood windows and
steel and fiberglass doors, enabling us to bundle complementary and
color-matched products and accessories with our core vinyl products. We have two
reportable segments: (i) siding, fencing, railing and decking, and (ii) windows
and doors.

Ply Gem Holdings, a wholly owned subsidiary of Ply Gem Investment Holdings,
Inc., was incorporated on January 23, 2004 for the purpose of acquiring Ply Gem
Industries, Inc. from Nortek (the "Ply Gem Acquisition"). The Ply Gem
Acquisition was completed on February 12, 2004, when Nortek sold Ply Gem
Industries, to Ply Gem Holdings, pursuant to the terms of the Stock Purchase
Agreement among Ply Gem Investment Holdings, Inc., Nortek, Inc., and WDS LLC
dated as of December 19, 2003, as amended. Prior to February 12, 2004, the date
of the Ply Gem Acquisition, Ply Gem Holdings, had no operations and Ply Gem
Industries, was a wholly-owned subsidiary of WDS LLC, which was a wholly-owned
subsidiary of Nortek.

On August 27, 2004 Ply Gem Industries acquired all of the outstanding capital
stock of MWM Holding, in accordance with a stock purchase agreement entered into
among Ply Gem, MWM Holding and the selling stockholders (the "MW Acquisition").
The accompanying financial statements include the operating results of MWM
Holding from August 27, 2004, the date of acquisition.

We are a holding company with no operations or assets of our own other than the
capital stock of our subsidiaries. The terms of Ply Gem Industries' credit
facility place restrictions on its ability to pay dividends and otherwise
transfer assets to us. Further, the terms of the indenture governing Ply Gem
Industries' 9% senior subordinated notes due 2012 place restrictions on the
ability of Ply Gem Industries and our other subsidiaries to pay dividends and
otherwise transfer assets to us.

FINANCIAL STATEMENT PRESENTATION

         NET SALES. Net sales represent the selling price of our products plus
certain shipping charges less applicable provisions for discounts and
allowances. Allowances include cash discounts, volume rebates and gross returns
among others.

         COST OF PRODUCTS SOLD. Cost of products sold includes direct material
and manufacturing costs, manufacturing depreciation, third-party and in-house
delivery costs and product warranty expense.

         SELLING, GENERAL AND ADMINISTRATIVE EXPENSE. Selling, general and
administrative expense, or "SG&A expense," includes all non-product related
operating expenses, including selling, marketing, research and development
costs, information technology and other general and administrative expenses.

         OPERATING EARNINGS. Operating earnings represents net sales less cost
of products sold, SG&A expense and amortization of intangible assets.

         COMPARABILITY. The data presented for the period ended July 3, 2004
includes predecessor data for Ply Gem Industries, Inc. from January 1, 2004 to
February 11, 2004 and successor data for Ply Gem

                                       29
<PAGE>

Holdings, Inc. from January 23, 2004 to July 3, 2004 and therefore those periods
are not directly comparable. In addition, during the period January 23, 2004
(inception) through February 11, 2004, Ply Gem Holdings, Inc., which ultimately
acquired Ply Gem Industries, Inc., conducted no operations.

IMPACT OF COMMODITY PRICING

Our principal raw materials, PVC resin and aluminum, have historically been
subject to rapid price changes. We have in the past been able to substantially
pass on significant cost increases through price increases to our customers. Our
results of operations for individual quarters can and have been impacted by a
delay between the time of PVC resin and aluminum cost increases and decreases
and related price changes that we implement in our products.

IMPACT OF WEATHER

Since our building products are intended for exterior use, our sales and
operating earnings tend to be lower during periods of inclement weather. Weather
conditions in the first quarter of each calendar year historically result in
that quarter producing significantly less sales revenue than in any other period
of the year. As a result, we have historically had lower profits or losses in
the first quarter, and reduced profits in the fourth quarter of each calendar
year due to the weather. Our results of operations for individual quarters in
the future may be impacted by adverse weather conditions.

CRITICAL ACCOUNTING POLICIES

The following discussion and analysis of our financial condition and results of
operations are based upon our combined and consolidated financial statements,
which have been prepared in accordance with U.S. generally accepted accounting
principles. Certain of our accounting policies require the application of
judgments in selecting the appropriate assumptions for calculating financial
estimates. By their nature, these judgments are subject to an inherent degree of
uncertainty. We periodically evaluate the judgments and estimates used for our
critical accounting policies to ensure that such judgments and estimates are
reasonable for our interim and year-end reporting requirements. These judgments
and estimates are based upon our historical experience, current trends and
information available from other sources, as appropriate. If different
conditions result than those assumptions used in our judgments, the results
could be materially different from our estimates. Management believes that the
two areas where different assumptions could result in materially different
reported results are accounts receivable related to estimation of allowances for
doubtful accounts and inventories in estimating reserves for obsolete and excess
inventory. Although we believe the likelihood of a material difference in either
of these two areas is very low based upon our historical experience, a 10%
change in our allowance for doubtful accounts and our inventory reserve
estimates at July 2, 2005 would result in a $0.8 million and $0.7 million impact
upon SG&A expense and cost of products sold, respectively. Additionally, we have
included in the discussion that follows our estimation methodology for both
accounts receivable and inventories. While all significant policies are
important to our combined and consolidated financial statements, some of these
policies may be viewed as being critical. Our critical accounting policies
include:

         REVENUE RECOGNITION. We recognize sales based upon shipment of products
to our customers net of applicable provisions for discounts and allowances.
Generally, the customer takes title upon shipment and assumes the risks and
rewards of ownership of the product. For certain products our customers take
title upon delivery, at which time revenue is then recognized. Revenue includes
selling price of the product and all shipping costs paid by the customer.
Revenue is reduced at the time of sale for estimated sales returns and all
applicable allowances and discounts based on historical experience. We also
provide for estimates of warranty, bad debts, shipping costs and certain
sales-related customer programs at the time of sale. Shipping and warranty costs
are included in cost of products sold. Bad debt expense and sales-related
marketing programs are included in selling, general and administrative expense.
We believe that our procedures for estimating such amounts are reasonable and
historically have not resulted in material adjustments in subsequent periods
when the estimates are reconciled to the actual amounts.

         ACCOUNTS RECEIVABLE. We maintain an allowance for doubtful accounts for
estimated losses from the inability of our customers to make required payments,
which is provided for in bad debt expense. We determine the adequacy of this
allowance by regularly reviewing our accounts receivable aging and evaluating
individual customers' receivables, considering customers' financial condition,
credit history and

                                       30
<PAGE>

other current economic conditions. If a customer's financial condition were to
deteriorate which might impact its ability to make payment, then additional
allowances may be required.

         INVENTORIES. Inventories in the accompanying consolidated and combined
balance sheets are valued at the lower of cost or market. At July 2, 2005, and
December 31, 2004 approximately $17.4 million and $11.7 million of total
inventories, respectively, were valued on the last-in, first-out method, or
"LIFO." Under the first-in, first-out method, or "FIFO," of accounting, such
inventories would have been approximately $1.2 million higher and $1.2 million
higher at July 2, 2005 and December 31, 2004, respectively. All other
inventories were valued under the FIFO method. We record provisions, as
appropriate, to write-down obsolete and excess inventory to estimated net
realizable value. The process for evaluating obsolete and excess inventory often
requires subjective judgments and estimates concerning future sales levels,
quantities and prices at which such inventory will be sold in the normal course
of business. Accelerating the disposal process or incorrect estimates of future
sales potential may cause the actual results to differ from the estimates at the
time such inventory is disposed or sold.

         ASSET IMPAIRMENT. In accordance with SFAS No. 144, we evaluate the
realizability of certain long-lived assets, which primarily consist of property
and equipment and intangible assets, based on expectations of non-discounted
future cash flows for each subsidiary having a material amount of long-lived
assets. If the sum of the expected non-discounted future cash flow is less than
the carrying amount of all assets including SFAS No. 144 long-lived assets, we
would recognize an impairment loss. Based upon our most recent analysis, we
believe that no material impairment of SFAS No. 144 long-lived assets existed at
July 2, 2005.

         GOODWILL IMPAIRMENT. In accordance with SFAS No. 142, we perform an
annual test for goodwill impairment. We assess goodwill, which is not subject to
amortization, for impairment during the fourth quarter of each year and also at
any other date when events or changes in circumstances indicate that the
carrying value of these assets may exceed their fair value.

         INSURANCE LIABILITIES. We record insurance liabilities and related
expense for health, workers' compensation, product and general liability losses
and other insurance reserves and expenses in accordance with either the
contractual terms of their policies or, if self-insured, the total liabilities
that are estimable and probable as of the reporting date. Insurance liabilities
are recorded as current liabilities to the extent they are expected to be paid
in the succeeding year with the remaining requirements classified as long-term
liabilities. The accounting for self-insured plans requires that significant
judgments and estimates be made both with respect to the future liabilities to
be paid for known claims and incurred but not reported claims as of the
reporting date. We rely heavily on historical trends and, in certain cases, the
advice and calculations of third-party actuarial consultants when determining
the appropriate insurance reserves to record in our consolidated balance sheets
for a substantial portion of our workers' compensation and general and product
liability losses.

         INCOME TAXES. Prior to February 12, 2004, federal income taxes have
been recorded in our combined financial statements based upon our pro rata share
of Nortek's consolidated federal tax provision. We account for deferred income
taxes using the liability method in accordance with SFAS No. 109 "Accounting for
Income Taxes," or "SFAS No. 109," which requires that the deferred tax
consequences of temporary differences between the amounts recorded in our
financial statements and the amount included in our federal and state income tax
returns be recognized in the balance sheet. The amount recorded in our financial
statements at December 31st of each year reflects estimates of final amounts due
to timing of completion and filing of actual income tax returns. Estimates are
required with respect to, among other things, the appropriate state income tax
rates to use in the various states that we and our subsidiaries are required to
file, the potential utilization of operating and capital loss carry-forwards for
both federal and state income tax purposes and valuation allowances required, if
any, for tax assets that may not be realized in the future. After February 12,
2004, U.S. federal income tax returns will be prepared and filed by Ply Gem
Investment Holdings, Inc. on behalf of itself, Ply Gem Holdings, Inc., Ply Gem
Industries, Inc. and its subsidiaries. We have executed a tax sharing agreement
with Ply Gem Holdings, Inc. and Ply Gem Investment Holdings, Inc. pursuant to
which tax liabilities for each respective party are computed on a stand-alone
basis. U.S. subsidiaries will continue to file unitary, combined and separate
state income tax returns. CWD Windows and Doors will file separate Canadian
income tax returns.

                                       31
<PAGE>

RESULTS OF OPERATIONS


In view of the seasonality of our business, it must be emphasized that the
results of operations for the periods presented are not necessarily indicative
of the results for a full fiscal year.

The following tables set forth our results of operations based on the amounts
and the percentage relationship of the items listed to net sales for the periods
indicated. However, our results of operations set forth in the tables below may
not necessarily reflect what would have occurred if we had been a separate,
stand-alone entity during the predecessor periods presented or what will occur
in the future. Unallocated cost of products sold and selling, general and
administrative expenses are not material and are not discussed in the following
section.

Our statement of operations data for the prior year period includes the period
January 1 through February 11, 2004 for Ply Gem Industries, Inc. and the period
from January 23 to July 3, 2004 for Ply Gem Holdings, Inc. Ply Gem Holdings,
Inc. had no operations during the period from January 23 to February 11, 2004.
The periods were prepared using different bases of accounting and therefore are
not directly comparable. As a result of the Ply Gem Acquisition on February 12,
2004, financial statements after that date reflect the impacts of purchase
accounting.



SIDING, FENCING, RAILING AND DECKING SEGMENT

<TABLE>
<CAPTION>
                                                  FOR THE THREE MONTHS ENDED
                                      -----------------------------------------------
(dollars in thousands)                      JULY 2, 2005              JULY 3, 2004
                                            ------------              ------------
                                      (unaudited)               (unaudited)
STATEMENT OF OPERATIONS DATA:
<S>                                      <C>         <C>           <C>         <C>
Net Sales..........................      110,180     100.0%        111,926     100.0%
Cost of products sold..............       84,851      77.0%         83,865      74.9%
                                         -------                   -------
Gross Profit ......................       25,329      23.0%         28,061      25.1%
S,G&A expense......................        9,145       8.3%          9,518       8.5%
Amortization of intangible assets..          807       0.7%            711       0.6%
                                         -------                   -------
Operating earnings.................       15,377      14.0%         17,832      15.9%
Interest expense, net..............          (42)      0.0%           (167)     -0.1%
                                         -------                   -------
Income before taxes................       15,335      13.9%         17,665      15.8%
</TABLE>

NET SALES

Net sales for the second quarter of 2005 decreased compared to the same period
in 2004 by approximately $1.7 million, or 2%. Net sales were lower than the
prior year due to lower unit volume partially offset by higher selling prices
which were increased in response to higher raw material and freight costs. The
decrease in unit sales volume was driven by poor weather in the late first
quarter and early second quarter that caused a late start to seasonal demand and
lower retail sales of our fencing products.

COST OF PRODUCTS SOLD

Cost of products sold for the second quarter of 2005 increased over the same
period in 2004 by approximately $1.0 million, or 1%. The increase in cost of
products sold was due to higher material costs, specifically PVC resin and
aluminum, both of which saw significant increases in market prices during the
second quarter of 2005 compared to the second quarter of 2004 and higher freight
expense related to carrier fuel costs. The increase in material and freight
costs were partially offset by lower unit sales volume as discussed above. The
increase in cost of products sold as a percentage of net sales was primarily
driven by increased material and freight cost not yet fully offset by our price
increases within the second quarter.

                                       32
<PAGE>

SELLING, GENERAL AND ADMINISTRATIVE EXPENSE

SG&A expense for the second quarter of 2005 decreased by approximately $0.4
million, or 4%, from the same period in 2004. The decrease in SG&A expenses was
primarily driven by the timing of certain selling and administrative expenses.
Management does not anticipate SG&A expenses as a percentage of sales to change
materially going forward.

<TABLE>
<CAPTION>
                                          FOR THE SIX MONTH PERIODS ENDED JULY 2, 2005 AND JULY 3, 2004
                                  ----------------------------------------------------------------------------
                                    JANUARY 1, 2005 TO         JANUARY 23, 2004 TO         JANUARY 1, 2004 TO
(dollars in thousands)                 JULY 2, 2005                JULY 3, 2004            FEBRUARY 11, 2004
                                       ------------                ------------            -----------------
                                  (unaudited)                (unaudited)                 (unaudited)
<S>                                 <C>          <C>           <C>           <C>           <C>         <C>
Statement of operations data:
Net Sales........................   189,028      100.0%        165,655       100.0%        29,546      100.0%
Cost of products sold............   150,895       79.8%        125,641        75.8%        24,281       82.2%
                                    -------                    -------                     ------
Gross Profit ....................    38,133       20.2%         40,014        24.2%         5,265       17.8%
S,G&A expense....................    17,795        9.4%         14,997         9.1%         4,272       14.5%
Amortization of intangible assets     1,612        0.9%          1,120         0.7%           303        1.0%
                                    -------                    -------                     ------
Operating earnings...............    18,726        9.9%         23,897        14.4%           690        2.3%
Interest expense, net............       (33)       0.0%           (277)       -0.2%        (3,700)     -12.5%
                                    -------                    -------                     ------
Income before taxes..............    18,693        9.9%         23,620        14.3%        (3,010)     -10.2%
</TABLE>


NET SALES

Net sales for the first half of 2005 decreased from the periods January 1, 2004
to February 11, 2004 and January 23, 2004 to July 3, 2004 (the "2004 periods")
by approximately $6.2 million, or 3%. Net sales were lower than prior year due
to lower unit volume partially offset by higher selling prices which were
increased in response to higher raw material and freight costs. The decrease in
unit sale volume was due to poor weather experienced in the Midwest and
Northeast in the late first quarter and early second quarter and lower retail
sales of our fence product.

COST OF PRODUCTS SOLD

Cost of products sold for the first half of 2005 increased over the 2004 periods
by approximately $1.0 million, or 1%. The increase in cost of products sold was
due to higher material costs, specifically PVC resin and aluminum, both of which
saw significant increases in market prices during the first six months of 2005
compared to the 2004 periods and higher freight expense related to market fuel
costs. The increase in material and freight costs were partially offset by lower
unit sales volume as discussed above. The increase in cost of products sold as a
percentage of net sales was primarily driven by increased material and freight
cost not yet fully offset by our price increases within the first six months of
2005 as compared to the 2004 periods presented.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSE

SG&A expense for the first half of 2005 decreased by approximately $1.5 million
from the 2004 periods. Marketing expenses decreased as a result of lower sales
volume and timing of certain selling and administrative expenses. Management
does not anticipate SG&A expenses as a percentage of sales to change materially
going forward.

                                       33
<PAGE>

WINDOWS AND DOORS SEGMENT

<TABLE>
<CAPTION>
                                                  FOR THE THREE MONTHS ENDED
                                        ---------------------------------------------
(dollars in thousands)                      JULY 2, 2005              JULY 3, 2004
                                            ------------              ------------
                                        (unaudited)               (unaudited)
<S>                                        <C>         <C>           <C>       <C>
Statement of operations data:
Net Sales...........................       120,123     100.0%        41,099    100.0%
Cost of products sold...............        89,991      74.9%        29,430     71.6%
                                           -------                   ------
Gross Profit .......................        30,132      25.1%        11,669     28.4%
S,G&A expense.....................          12,937      10.8%         5,589     13.6%
Amortization of intangible assets            1,634       1.4%            51      0.1%
                                           -------                   ------
Operating earnings..................        15,561      13.0%         6,029     14.7%
Currency translation gain (loss)....          (233)     -0.2%            --      0.0%
Interest expense, net...............          (578)     -0.5%          (556)    -1.4%
                                           -------                   ------
Income before taxes................         14,750      12.3%         5,473     13.3%
</TABLE>


NET SALES

Net sales for the second quarter of 2005 increased over the same period in 2004
by approximately $79.0 million. The increase in net sales was primarily driven
by sales of MW, which contributed $78.2 million to our net sales during the
second quarter of 2005. Our Western Canadian window sales increased by $2.8
million due in part to favorable weather conditions in that region and increased
housing starts in the Canadian province of Alberta. Second quarter net sales of
our U.S. repair and remodeling window products were negatively impacted by poor
weather in the late first quarter and early second quarter, as well as some
general softness in end use demand for repair and remodeling windows. Our new
repair and replacement window products lines that were introduced during the
first half of 2005 have been well received by our customers, however, sales for
these new repair and replacement windows were dampened by the impact of poor
weather and softness in end use demand.

COST OF PRODUCTS SOLD

Cost of products sold for the first half of 2005 increased by approximately
$60.6 million over the same period in 2004. The increase in cost of products
sold was primarily due to net sales contributed by MW and increased cost of
products sold at our Canadian subsidiary related to higher sales volume. The
increase in cost of products sold as a percentage of net sales was driven by an
increased mix of new construction window sales contributed by MW and the affect
of manufacturing inefficiencies that occurred during the launch of our new
repair and remodeling window product lines. Increased raw material costs and
freight expenses related to fuel costs were partially offset by cost savings and
synergies that the Company is realizing from the acquisition of MW in August
2004.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSE

SG&A expense for the second quarter of 2005 increased by approximately $7.3
million over the same period in 2004. The increase in SG&A expense was primarily
due to the addition of MW operations, which increased SG&A expenses by
approximately $7.1 million. Management does not anticipate SG&A expenses as a
percentage of sales to change materially going forward.

                                       34
<PAGE>

<TABLE>
<CAPTION>
                                          FOR THE SIX MONTH PERIODS ENDED JULY 2, 2005 AND JULY 3, 2004
                                       JANUARY 1, 2005 TO         JANUARY 23, 2004 TO         JANUARY 1, 2004 TO
(dollars in thousands)                    JULY 2, 2005                JULY 3, 2004             FEBRUARY 11, 2004
                                          ------------                ------------             -----------------
                                  (unaudited)                 (unaudited)                 (unaudited)
<S>                                  <C>           <C>           <C>             <C>         <C>          <C>
Statement of operations data:
Net Sales........................    213,010       100.0%        60,120          100.0%      11,066       100.0%
Cost of products sold............    161,416        75.8%        44,106           73.4%       9,448        85.4%
                                     -------                     ------                      ------
Gross Profit ....................     51,594        24.2%        16,014           26.6%       1,618        14.6%
S,G&A expense....................     27,092        12.7%         8,767           14.6%       3,040        27.5%
Amortization of intangible assets      3,269         1.5%            80            0.1%          22         0.2%
                                     -------                     ------                      ------
Operating earnings...............     21,233        10.0%         7,167           11.9%      (1,444)      -13.0%
Currency translation gain (loss).       (537)       -0.3%            --                          --
Interest expense, net............       (638)       -0.3%         (478)           -0.8%         (93)       -0.8%
                                     -------                     ------                      ------
Income before taxes..............     20,058         9.4%         6,689           11.1%      (1,537)      -13.9%
</TABLE>

NET SALES

Net sales for the first half of 2005 increased from the periods January 1, 2004
to February 11, 2004 and January 23, 2004 to July 3, 2004 (the "2004 periods")
by approximately $141.8 million. The increase in net sales was primarily driven
by sales of MW, which contributed $140.9 million to our net sales during the
first half of 2005. Our Western Canadian window sales increased by approximately
$4.3 million due to favorable weather conditions in that region and increased
housing starts in the Canadian province of Alberta. First half net sales of our
U.S. repair and remodeling window products were negatively impacted by poor
weather in the late first quarter and early second quarter, as well as, some
general softness in end use demand for repair and remodeling windows.
Additionally, the periods presented for 2004 included $1.0 million of net sales
attributable to Thermal-Gard, which ceased operations in April 2004.

COST OF PRODUCTS SOLD

Cost of products sold for the first half of 2005 increased by approximately
$107.9 million over the 2004 periods. The increase in cost of products sold was
primarily due to net sales contributed by MW and increased cost of products sold
at our Canadian subsidiary related to higher sales volume. Thermal-Gard, which
ceased operations in April 2004, contributed $0.8 million to cost of products
sold for the 2004 periods presented. The increase in cost of products sold as a
percentage of net sales was driven by an increased mix of new construction
window sales contributed by MW and the effect of manufacturing inefficiencies
that occurred during the launch of our new repair and remodeling window product
lines during the first half of 2005. Increased raw material market costs and
freight expense related to fuel costs were partially offset by cost savings and
synergies that the Company is realizing from the acquisition of MW in August
2004.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSE

SG&A expense for the first half of 2005 increased by approximately $15.3 million
over the 2004 periods. The increase in SG&A expense was primarily due to the
addition of MW operations, which increased SG&A expenses by approximately $14.8
million. Management does not anticipate SG&A expenses as a percentage of sales
to change materially going forward.


UNALLOCATED EXPENSES

                                              FOR THE THREE MONTHS ENDED
                                        ---------------------------------------
                                          JULY 2, 2005         JULY 3, 2004
                                          (unaudited)          (unaudited)
Statement of operations data:
Interest expense, net.............             13,309               7,253
Income tax expense................              6,058               5,550

                                       35
<PAGE>

<TABLE>
<CAPTION>
                                     FOR THE SIX MONTH PERIODS ENDED JULY 2, 2005 AND JULY 3, 2004
                                    ----------------------------------------------------------------
                                    JANUARY 1, 2005 TO    JANUARY 23, 2004 TO     JANUARY 1, 2004 TO
(dollars in thousands)                 JULY 2, 2005           JULY 3, 2004         FEBRUARY 11, 2004
                                       (unaudited)            (unaudited)             (unaudited)
<S>                                         <C>                   <C>                    <C>
Statement of operations data:
Interest expense, net..........             27,781                12,249                   (138)
Income tax expense (benefit)...              3,573                 5,639                 (1,850)
</TABLE>

INTEREST EXPENSE Interest expense for the second quarter of 2005 increased by
approximately $6.1 million over the same period in 2004 as a result of increased
borrowings due to the MW Acquisition in August of 2004. Interest expense for the
first half of 2005 increased by approximately $15.7 million over the 2004
periods, primarily as a result of increased borrowings due to the Ply Gem and MW
Acquisitions. Intercompany interest expense of approximately $3.5 million
incurred for the period January 1, 2004 to February 11, 2004 was recorded in the
Siding, Fencing, Railing and Decking Segment, and was based on an intercompany
note payable to a wholly owned subsidiary of our former parent, Nortek, Inc.

INCOME TAXES The income tax expense for the second quarter of 2005 increased
$0.5 million over the same period in 2004, primarily as a result of the greater
pre-tax income for the 2005 period versus the 2004 period. The income tax
expense for the first half of 2005 decreased $0.2 million compared to the 2004
periods, primarily as a result of a decrease in pre-tax income for the 2005
period versus the 2004 periods.


LIQUIDITY AND CAPITAL RESOURCES

HISTORICAL

Our primary cash needs are for working capital, capital expenditures and debt
service. We have historically financed these cash requirements through
internally generated cash flow and funds borrowed under our credit facility.

Net cash provided by operating activities for the first six months of 2005 and
the 2004 periods of January 1, 2004 to February 11, 2004 and January 23, 2004 to
July 3, 2004 was approximately $9.0 million, $1.6 million, and $9.2 million,
respectively. The decrease in net cash provided by operating activities for the
2005 period compared to the 2004 periods presented was primarily driven by
increased working capital requirements as a result of the acquisition of MW.

Net cash provided by (used in) investing activities for the first six months of
2005 and the 2004 periods of January 1, 2004 to February 11, 2004 and January
23, 2004 to July 3, 2004 was approximately ($4.7) million, $0.4 million, and
($554.6) million, respectively. The cash used in investing activities during the
2004 periods was driven by the cash used to fund the Ply Gem Acquisition.
Capital expenditures for the first six months of 2005 increased over the 2004
periods presented due to the normal capital requirements of MW which was
acquired in August 2004.

Net cash provided by (used in) financing activities for the first six months of
2005 and the 2004 periods of January 1, 2004 to February 11, 2004 and January
23, 2004 to July 3, 2004 was approximately $15.5 million, ($7.5) million and
$556.2 million respectively. The cash provided by financing activities for the
2004 periods was driven by the cash provided from our new capital structure that
resulted from the consummation of the Ply Gem Acquisition, which includes our
senior subordinated notes, senior term loan facilities, our senior revolving
credit facility, and $136.7 million of equity contribution.

Our capital expenditures for the first six months of 2005 and the 2004 periods
of January 1, 2004 to February 11, 2004 and January 23, 2004 to July 3, 2004
were approximately $5.2 million, $0.7 million and $2.4 million, respectively.
The capital expenditures during the first six months of 2005 includes
expenditures of approximately $2.5 million for MW, which was purchased during
the third quarter of 2004. We expect our capital expenditures in the near future
to remain consistent with our expenditures in past periods.

                                       36
<PAGE>

IMPACT OF THE PLY GEM ACQUISITION AND THE MW ACQUISITION

We intend to fund our ongoing capital and working capital requirements,
including our internal growth, through a combination of cash flows from
operations and, if necessary, from borrowings under the revolving credit portion
of our senior credit facilities. As of July 2, 2005, we had $687.5 million of
indebtedness and $44.9 million of availability under our revolving credit
facility. The Company's senior credit facility with a syndicate of financial
institutions and institutional lenders provides for senior secured financing of
up to $381.0 million, consisting of $311.0 million of term loan facilities with
a maturity of seven years after the original date of the credit agreement
(February 12, 2004) and a $70.0 million revolving loan facility, including a
letter of credit subfacility, with a maturity of five years. The term loan
facility was drawn in full in connection with the consummation of the Ply Gem
and MW Acquisitions. The term loan facilities have three tranches, consisting
of: i) a $170.0 million tranche under which Ply Gem Industries, Inc. is the
borrower, ii) a $30.0 million tranche under which our Canadian subsidiary, CWD
Windows and Doors, Inc., is the borrower, and iii) a $111.0 million tranche
under which Ply Gem Industries, Inc. is the borrower, which was added to the
facility August 27, 2004, as a result of the financing for the MW acquisition.
Concurrently with the Ply Gem Acquisition, Ply Gem Industries, Inc. issued
$225.0 million aggregate principal amount of our 9% senior subordinated notes
due 2012, which are guaranteed by Ply Gem Holdings Inc. and the domestic
subsidiaries of Ply Gem Industries, Inc. Subsequently, in connection with the MW
Acquisition, Ply Gem Industries, Inc. issued an additional $135.0 million of our
9% senior subordinated notes due 2012, which are guaranteed by Ply Gem Holdings
Inc. and the domestic subsidiaries of Ply Gem Industries, Inc.

During December 2004, Ply Gem Industries repaid the entire amount borrowed
against the revolving credit facility. Also during December 2004, Ply Gem
Industries prepaid $5.0 million of the $30.0 million tranche under which our
Canadian subsidiary, CWD Windows and Doors, Inc. is the borrower.

During the first quarter of 2005, Ply Gem Industries borrowed $35.5 million
under the revolving credit facility to fund our seasonal working capital
requirements and first quarter capital expenditures. And during the second
quarter of 2005, Ply Gem Industries repaid $11.5 million of the amount borrowed
against the revolving credit facility.

The borrowings under the revolving credit facility will be available until its
maturity to fund our working capital requirements, capital expenditures and
other general corporate needs. The revolving credit facility will mature five
years after the closing of the Ply Gem Acquisition and will have no scheduled
amortization or commitment reductions. The term loan facilities will mature
seven years after the closing of the Ply Gem Acquisition and have quarterly
scheduled amortizations of $0.5 million beginning in the quarter ended July 3,
2004 and for the next 23 calendar quarters thereafter, $45.8 million on each of
June 30, 2010, September 30, 2010, December 31, 2010, and $156.6 million on the
maturity date.

On July 25, 2005, the Company entered into an amendment to its credit facility.
Under the terms of the amended agreement, the Company will be permitted to use
its excess cash flow and/or a portion of its revolving credit facility to
repurchase up to $25.0 million aggregate principal amount of the Company's 9%
Senior Subordinated Notes due 2012. Subject to market conditions, its capital
needs and other factors, the Company may from time to time purchase up to $25.0
million aggregate principal amount of its 9% Senior Subordinated Notes due 2012
in market transactions, privately negotiated sales or other transactions.

The senior credit facilities and the indenture for the senior subordinated notes
impose certain restrictions on Ply Gem Industries, Inc., including restrictions
on its ability to incur indebtedness, pay dividends, make investments, grant
liens, sell assets and engage in certain other activities. The terms of the
senior credit facilities and the senior subordinated notes also significantly
restrict the ability of Ply Gem Industries, Inc. to pay dividends and otherwise
distribute assets to Ply Gem Holdings, Inc. In addition, the senior credit
facilities require Ply Gem Industries, Inc. to comply with certain financial
ratios. Indebtedness under the senior credit facilities is secured by
substantially all of Ply Gem Industries Inc.'s assets, including its real and
personal property, inventory, accounts receivable, intellectual property and
other intangibles. In addition, our U.S. senior credit facilities are guaranteed
by Ply Gem Holdings, Inc. and secured by its assets (including its equity
interests), as well as guaranteed and secured by the equity interests and
substantially all of the assets of our current and, if any, future domestic
subsidiaries, subject to exceptions.

                                       37
<PAGE>

Because of the inherent seasonality in our business and the resulting working
capital requirements, our liquidity position within a given year will fluctuate.
The seasonal effect that creates greatest capital needs is experienced during
the first six months of the year and we anticipate the need to borrow funds
under our existing revolving credit facility to support this requirement.
However, we anticipate that the funds generated by operations and funds
available under our new senior credit facilities will be adequate to finance our
ongoing operational cash flow needs, capital expenditures (as described above),
debt service obligations, management incentive expenses, fees payable under the
General Advisory Agreement with a Caxton-Iseman party, dated February 12, 2004
(the "General Advisory Agreement"), and other contractual obligations for the
foreseeable future.


INFLATION; SEASONALITY

Our performance is dependent to a significant extent upon the levels of home
repair and remodeling and new home construction spending, all of which are
affected by such factors as interest rates, inflation, consumer confidence and
unemployment.

The demand for our products is seasonal, particularly in the Northeast and
Midwest regions of the United States and Western Canada where inclement weather
during the winter months usually reduces the level of building and remodeling
activity in both the home repair and remodeling and new home construction
sectors. Our sales are usually lower during the first and fourth quarters. Since
a portion of our manufacturing overhead and operating expenses are relatively
fixed throughout the year, operating income and net earnings tend to be lower in
quarters with lower sales levels. In addition, the demand for cash to fund our
working capital is greater from late in the fourth quarter through the first
quarter.


RECENT ACCOUNTING PRONOUNCEMENTS

In December 2004, the FASB issued SFAS No. 123 (revised 2004) ("SFAS 123R"),
"Share-Based Payment". SFAS 123R establishes standards for the accounting for
transactions in which an entity exchanges its equity instruments for goods and
services or incurs liabilities in exchange for goods or services that are based
on the fair value of the entity's equity instruments or that may be settled by
the issuance of those equity instruments. SFAS 123R requires a public entity to
measure the cost of employee services received in exchange for an award of
equity instruments based on the grant-date fair value of the award and to
recognize that cost over the period during which an employee is required to
provide service in exchange for the award. Due to the Securities and Exchange
Commission's delay of the effective date, the Company plans to adopt the
provisions of SFAS 123R for the first quarter of our fiscal year ending December
31, 2006. At this time, we do not anticipate that the adoption of this statement
will have a material effect on our consolidated financial position or results of
operations.

In March 2005, the FASB issued Financial Interpretation No. 47, "Accounting for
Conditional Asset Retirement Obligations" (FIN 47). FIN 47 clarifies the term,
conditional asset retirement obligation, as used in SFAS No. 143 "Accounting for
Asset Retirement Obligations," which refers to a legal obligation to perform an
asset retirement activity in which the timing and (or) method of settlement are
conditional on a future event. Uncertainty about the timing and (or) method of
settlement of a conditional asset retirement obligation should be factored into
the measurement of the liability when sufficient information exists. FIN 47 is
effective no later than the end of fiscal years ending after December 15, 2005.
We are evaluating the effect FIN 47 will have on our consolidated financial
statements.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. We based these
forward-looking statements on our current expectations and projections about
future events. Our actual results could differ materially from those discussed
in, or implied by, these forward-looking statements. Forward-looking statements
are identified by words such as "believe," "anticipate," "expect," "intend,"
"plan," "will," "may" and other similar expressions. In addition, any statements
that refer to expectations, projections or other characterizations of future
events or

                                       38
<PAGE>

circumstances are forward-looking statements. The following factors could cause
our actual results to differ materially from those implied by the
forward-looking statements in this Quarterly Report:

    o    our high degree of leverage and significant debt service obligations;

    o    restrictions under the indenture governing the notes and our senior
         credit facilities;

    o    the competitive nature of our industry;

    o    changes in interest rates, and general economic, home repair and
         remodeling and new home construction market conditions;

    o    changes in the price and availability of raw materials; and

    o    changes in our relationships with our significant customers.

Other factors that could cause actual results to differ from those implied by
the forward-looking statements contained in this Quarterly Report are set forth
in our 2004 Annual Report on Form 10-K. We undertake no obligation to update the
forward-looking statements in this filing.



                                       39
<PAGE>

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK


         Our principal interest rate exposure relates to the term loans
outstanding under our new senior credit facilities. We have approximately $303.2
million of term loans outstanding, bearing interest at a variable rate, based on
an adjusted LIBOR rate plus an applicable interest margin or the base rate plus
an applicable interest margin. Each quarter point increase or decrease in the
interest rate on the term loans would change our interest expense by
approximately $0.8 million per year. We also have a revolving credit facility
which provides for borrowings of up to $70.0 million, which will also bear
interest at variable rates in the same manner as the term loan facilities.
Assuming the new revolving credit facility is fully drawn, each quarter point
increase or decrease in the applicable interest rate would change our interest
expense by approximately $0.2 million per year. In the future we may enter into
interest rate swaps, involving exchange of floating or fixed rate interest
payments, to reduce our exposure to interest rate volatility.

         Our term loan facility has three tranches. Outstanding balances consist
of a $167.7 million tranche under which Ply Gem Industries, Inc. is the
borrower, a $110.9 million tranche under which Ply Gem Industries, Inc. is the
borrower, and a $24.6 million tranche under which our Canadian subsidiary is the
borrower.

         Our results of operations are affected by fluctuations in the value of
the U.S. dollar as compared to the value of the Canadian dollar. For the six
months ended July 2, 2005, the net impact of foreign currency changes to the
Company's results of operations was a loss of $0.5 million. The impact of
foreign currency changes related to translation resulted in a decrease in
stockholder's equity of approximately $0.3 million for the six months ended July
2, 2005. The revenue or expense reported by us as a result of currency
fluctuations will be greater in times of U.S. dollar devaluation and less in
times of U.S. dollar appreciation. We generally do not enter into derivative
financial instruments to manage foreign currency exposure. For the six months
ended July 2, 2005, we did not have any significant outstanding foreign currency
hedging contracts.



ITEM 4.     CONTROLS AND PROCEDURES

         We carried out an evaluation, under the supervision and with the
participation of our management, including our Chief Executive Officer and Chief
Financial Officer, of the effectiveness of our disclosure controls and
procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Securities
Exchange Act of 1934. Based on that evaluation, our Chief Executive Officer and
Chief Financial Officer have concluded that our disclosure controls and
procedures as of July 2, 2005 were effective to ensure that information required
to be disclosed by us in reports that we file or submit under the Securities
Exchange Act of 1934 is recorded, processed, summarized and reported within the
time periods specified in Securities and Exchange Commission's rules and forms.

         As previously disclosed in our Annual Report of Form 10-K for the year
ended December 31, 2004, we implemented additional review procedures over the
application of sale leaseback accounting. There were no other changes in our
internal control over financial reporting that occurred during the quarter ended
July 2, 2005 that have materially affected, or are reasonably likely to
materially affect, our internal control over financial reporting.




                                       40
<PAGE>

PART II - OTHER INFORMATION


ITEM 6.           EXHIBITS

     (a) EXHIBITS

The exhibit listed below is filed as part of Form 10-Q for quarter ended July 2,
2005.

EXHIBIT NO.                       DESCRIPTION OF EXHIBIT
-----------                       ----------------------

     31.1        Certification by President and Chief Executive Officer pursuant
                 to Rule 13a-14(a) of the Securities Exchange Act of 1934*

     31.2        Certification by Vice President and Chief Financial Officer
                 pursuant to Rule 13a-14(a) of the Securities Exchange Act of
                 1934*

     32.1        Certification by President and Chief Executive Officer pursuant
                 to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of
                 the Sarbanes-Oxley Act of 2002

     32.2        Certification by Executive Vice President and Chief Financial
                 Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant
                 to Section 906 of the Sarbanes-Oxley Act of 2002


     Filed herewith.



SIGNATURES

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

                                                         PLY GEM HOLDINGS, INC.
                                                              (Registrant)


Date:  August 15, 2005

                                                 By: /s/ Lee D. Meyer
                                                 -------------------------------
                                                                    Lee D. Meyer
                                           President and Chief Executive Officer


Date:  August 15, 2005

                                                 By: /s/ Shawn K. Poe
                                                 -------------------------------
                                                                    Shawn K. Poe
                                                           Vice President, Chief
                                      Financial Officer, Treasurer and Secretary



                                       41