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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 10-K
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 29, 2007.
 or
 o
    
    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 000-24956
 Associated Materials, LLC
 
 DELAWARE
(State or other jurisdiction of incorporation or organization)
    
    75-1872487
(I.R.S. Employer Identification No.)
 3773 STATE ROAD
CUYAHOGA FALLS, OHIO 44223
 (330) 929-1811
 NONE
 NONE
 o þ
 þ o
 þ o
 þ
  Large Accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer þ
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ




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TABLE OF CONTENTS  PART IITEM 1. BUSINESSITEM 1A. RISK FACTORSITEM 1B. UNRESOLVED STAFF COMMENTSITEM 2. PROPERTIESITEM 3. LEGAL PROCEEDINGSITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERSPART IIITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIESITEM 6. SELECTED FINANCIAL DATAITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATAITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSUREITEM 9A. CONTROLS AND PROCEDURESITEM 9B. OTHER INFORMATIONPART IIIITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANTITEM 11. EXECUTIVE COMPENSATIONITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERSITEM 13. CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCEITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICESPART IVITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-KSIGNATURESEXHIBIT INDEXEX-3.1EX-3.2EX-21.1EX-24.1EX-31.1EX-31.2EX-32.1EX-32.2    Table of Contents  
 PART I
 
 ITEM 1. BUSINESS
 GENERAL DEVELOPMENT OF BUSINESS
 ® ® ®
  ® ®
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FINANCIAL INFORMATION ABOUT SEGMENTS
  INDUSTRY OVERVIEW
  
    
    Favorable demographics. The segment of the population age 45 years and above, which
generally favors professionally installed, low maintenance home improvements, is growing.
By 2010, this age segment is expected to represent approximately 40% of the United States
population.
    
    Aging of the housing stock. The median home age increased from 23 years in 1985 to 32
years in 2005, and more than 65% of the current housing stock was built prior to 1980.
    
    Increase in average home size. The average home size increased over 35% from 1,785
square feet in 1985 to 2,469 square feet in 2006.
    
    Favorable mortgage interest rates. Despite recent increases, mortgage interest rates
over the past few years have been at historically low levels.
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Products
 ® ® ® ® ® ®
 ® ® ®
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® ® ®
  ®
 4




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® ® ®
 Product Line
    
    Window
    
    Vinyl Siding
    
    Steel Siding
    
    Aluminum SidingPremium
    
    Preservation
Regency
Sequoia Select
Sheffield
Sovereign
UltraMaxx
Westbridge
    
    Bennington Board
   and Batten
Berkshire Beaded 
Board and Batten
Centennial Beaded
CenterLock
Charter Oak
Cyprus Creek
Northern Forest
Preservation
Prodigy
Sequoia Select
Sovereign Select
Williamsport
    
    CedarwoodDriftwood
Gallery Series
SuperGuard
SteelTek
SteelSide
Universal
    
    Cedarwood
Vin.Al.Wood
DeluxeStandard
    
    Alpine 80 Series
Berkshire
Excalibur
Fairfield 80 Series
Sierra
Signature
    
    Advantage III
Advantage Plus
Amherst
Berkshire Classic
Concord
Coventry
Fair Oaks
Odyssey Plus
Signature Supreme
Somerville IIIEconomy
    
    Alpine 70 Series
Amherst
Blue Print Series
Builder Series
Centurion
Concord
Fairfield 70 Series
Geneva
New Construction
Performance Series
    
    Aurora
Conquest
Driftwood
Homerun
    
    
    
    Woodgrain Series
 ®
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Marketing and Distribution
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Manufacturing.
   Raw Materials.
 Competition.
 7




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Seasonality.
 BACKLOG
  TRADEMARKS, PATENTS AND OTHER INTANGIBLE ASSETS
 ® ® ® ® ® ®
  GOVERNMENT REGULATION AND ENVIRONMENTAL MATTERS
  8




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EMPLOYEES
   FINANCIAL INFORMATION ABOUT GEOGRAPHIC AREAS
  AVAILABLE INFORMATION
 www.associatedmaterials.com
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##### Table of Contents



ITEM 1A . RISK FACTORS
   The Companys substantial level of indebtedness could adversely affect its financial
condition.
   
    
    the Companys ability to obtain additional financing for working capital, capital
expenditures, acquisitions or general corporate purposes may be impaired;
    
    the Company must use a substantial portion of its cash flow from operations to pay
interest and principal on the notes and other indebtedness, which will reduce the funds
available to the Company for other purposes such as potential acquisitions and capital
expenditures;
    
    the Company is exposed to fluctuations in interest rates, because the credit facility
has a variable rate of interest;
    
    the Company has a higher level of indebtedness than some of its competitors, which may
put it at a competitive disadvantage and reduce the Companys flexibility in planning for,
or responding to, changing industry conditions, including increased competition;
    
    the Company is more vulnerable to general economic downturns and adverse developments
in its business; and
    
    the Companys failure to comply with financial and other restrictive covenants in the
credit facility, in the indenture governing the $165 million of 9 3/4% senior subordinated
notes due 2012 (9 3/4% notes) and other debt obligations, some of which require the
Company to maintain specified financial ratios and limit the Companys ability to incur
additional debt and sell assets, could result in an event of default that, if not cured or
waived, could harm the Companys business or prospects and could result in bankruptcy.
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If AMH II defaults on its debt obligations, it could result in a change in control.
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The Company will be able to incur more indebtedness and the risks associated with its
substantial leverage, including its ability to service its indebtedness, will increase.
  The right to receive payments on the 9 3/4% notes and guarantees is subordinated to the
Companys senior debt.
  The indenture for the 9 3/4% notes and the credit facility impose significant operating and
financial restrictions on the Company, which may prevent it from capitalizing on business
opportunities and taking some corporate actions.
  
    
    incur or guarantee additional indebtedness;
    
    pay dividends or make other distributions;
    
    repurchase stock;
    
    make investments;
    
    sell or otherwise dispose of assets including capital stock of subsidiaries;
    
    create liens;
    
    enter into agreements restricting the Companys subsidiaries ability to pay dividends;
    
    enter into transactions with affiliates; and
    
    consolidate, merge or sell all of its assets.
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The exterior residential building products industry is cyclical and downturns in the industry
or the economy could negatively affect the Companys operating results.
  The Company has substantial fixed costs and, as a result, operating income is sensitive to
changes in net sales.
  Changes in raw material costs and availability can adversely affect the Companys profit
margins.
  The Company could face potential product liability claims relating to products it manufactures
or distributes.
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The Company has significant goodwill and other intangible assets.
 ® ® ® ®
 The Company is controlled by affiliates of Investcorp S.A. and Harvest Partners, Inc., whose
interests may be different than other investors.
  The Company may incur significant, unanticipated warranty claims.
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The Company is subject to various environmental statutes and regulations, which may result in
significant costs.
   
 ITEM 1B . UNRESOLVED STAFF COMMENTS
  15




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ITEM 2 . PROPERTIES
  Location
    
    Principal Use
    
    Square FeetCuyahoga Falls, Ohio
    
    Corporate Headquarters
    
    
    70,000Cuyahoga Falls, Ohio
    
    Vinyl Windows, Vinyl Fencing and Railing
    
    
    577,000Bothell, Washington
    
    Vinyl Windows
    
    
    159,000
    (1)Yuma, Arizona
    
    Vinyl Windows
    
    
    223,000
    (1)Cedar Rapids, Iowa
    
    Vinyl Windows
    
    
    257,000
    (1)Kinston, North Carolina
    
    Vinyl Windows
    
    
    319,000
    (1)London, Ontario
    
    Vinyl Windows
    
    
    60,000Burlington, Ontario
    
    Vinyl Siding Products
    
    
    394,000
    (2)Ennis, Texas
    
    Vinyl Siding Products
    
    
    538,000
    (3)West Salem, Ohio
    
    Vinyl Window Extrusions, Vinyl Fencing and Railing
    
    
    173,000Pointe Claire, Quebec
    
    Metal Products
    
    
    289,000Woodbridge, New Jersey
    
    Metal Products
    
    
    318,000
    (1)
 
 (1)
    
    Leased facilities.(2)
    
    The Company leases a portion of its warehouse space in this facility.(3)
    
    Includes a 237,000 square foot warehouse that was built during 2005 and is leased. The
Company owns the remainder of the facility.    16




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ITEM 3. LEGAL PROCEEDINGS
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ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS
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PART II
 
 ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF
EQUITY SECURITIES
 MARKET INFORMATION
  HOLDERS
  DIVIDENDS
    SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS
  RECENT SALES OF UNREGISTERED SECURITIES
  PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
  19




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##### Table of Contents



ITEM 6. SELECTED FINANCIAL DATA
  Year
    
    
    Year
    
    
    Year
    
    
    Year
    
    
    YearEnded
    
    
    Ended
    
    
    Ended
    
    
    Ended
    
    
    EndedJanuary 3,
    
    
    January 1,
    
    
    December 31,
    
    
    December 30,
    
    
    December 29,2004
    
    
    2005
    
    
    2005
    
    
    2006
    
    
    2007(In thousands)Income Statement Data:Net sales
    
    $
    779,836
    
    
    $
    1,093,959
    
    
    $
    1,173,591
    
    
    $
    1,250,054
    
    
    $
    1,204,056Cost of sales
    
    
    561,525
    
    
    
    804,951
    
    
    
    906,267
    
    
    
    947,776
    
    
    
    899,839Gross profit
    
    
    218,311
    
    
    
    289,008
    
    
    
    267,324
    
    
    
    302,278
    
    
    
    304,217Selling, general and administrative
expenses
    
    
    149,571
    
    
    
    184,524
    
    
    
    198,493
    
    
    
    203,844
    
    
    
    208,001Impairment of long-lived assets(1)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,423
    
    
    
    Transaction costs:Bonuses(2)
    
    
    
    
    
    
    36,811
    
    
    
    
    
    
    
    
    
    
    
    Stock option compensation expense(3)
    
    
    
    
    
    
    30,838
    
    
    
    
    
    
    
    
    
    
    
    Facility closure costs, net(4)
    
    
    
    
    
    
    4,535
    
    
    
    3,956
    
    
    
    (92
    )
    
    
    Income from operations
    
    
    68,740
    
    
    
    32,300
    
    
    
    64,875
    
    
    
    95,103
    
    
    
    96,216Interest expense(5)
    
    
    27,369
    
    
    
    27,784
    
    
    
    31,922
    
    
    
    32,413
    
    
    
    27,943Foreign currency (gain) loss
    
    
    (548
    )
    
    
    387
    
    
    
    781
    
    
    
    (703
    )
    
    
    (227
    )Recapitalization transaction costs(6)
    
    
    
    
    
    
    16,297
    
    
    
    
    
    
    
    
    
    
    
    Income (loss) before income taxes
    
    
    41,919
    
    
    
    (12,168
    )
    
    
    32,172
    
    
    
    63,393
    
    
    
    68,500Income taxes (benefit)
    
    
    17,388
    
    
    
    (1,234
    )
    
    
    9,709
    
    
    
    30,096
    
    
    
    28,845Net income (loss)
    
    $
    24,531
    
    
    $
    (10,934
    )
    
    $
    22,463
    
    
    $
    33,297
    
    
    $
    39,655Other Data:Cash provided by operating activities
    
    $
    55,976
    
    
    $
    18,737
    
    
    $
    47,897
    
    
    $
    68,300
    
    
    $
    71,351Capital expenditures
    
    
    12,689
    
    
    
    18,741
    
    
    
    20,959
    
    
    
    14,648
    
    
    
    12,393Cash used in investing activities
    
    
    (123,510
    )
    
    
    (18,651
    )
    
    
    (20,877
    )
    
    
    (11,740
    )
    
    
    (13,175
    )Cash provided by (used in) financing
activities
    
    
    58,738
    
    
    
    53,176
    
    
    
    (72,882
    )
    
    
    (53,863
    )
    
    
    (53,018
    )Balance Sheet Data (end of period):Working capital
    
    $
    113,698
    
    
    $
    200,048
    
    
    $
    154,536
    
    
    $
    151,022
    
    
    $
    157,550Total assets
    
    
    721,004
    
    
    
    850,855
    
    
    
    817,597
    
    
    
    786,331
    
    
    
    793,939Long-term debt, less current maturities
    
    
    305,000
    
    
    
    339,125
    
    
    
    317,000
    
    
    
    271,000
    
    
    
    226,000
 
 (1)
    
    The Company recorded an impairment charge of $2.6 million against certain machinery and
equipment, trademarks, and patents used to manufacture its fence and rail products during 2006
as their carrying values exceed their fair value. In addition, due to changes in the Companys
information technology and business strategies, $0.8 million of software and other equipment
was considered impaired.(2)
    
    Represents bonuses paid to certain members of management and a director in conjunction with
the March 2004 dividend recapitalization and the December 2004 recapitalization transaction of
$14.5 million and $22.3 million, respectively.(3)
    
    Represents stock option compensation expense recognized in connection with the December 2004
recapitalization transaction resulting from the exercise and redemption of certain stock
options.(4)
    
    Represents one-time costs associated with the closure of the Freeport, Texas manufacturing
facility consisting primarily of asset impairments of approximately $3.7 million, equipment
relocation costs of approximately $0.3 million, severance benefits of approximately $0.3
million and contract termination costs of approximately $0.2 million for the year ended
January 1, 2005 and relocation costs for certain equipment of approximately $1.9 million,
inventory relocation costs of approximately $1.5 million, facility shut down costs of
approximately $0.4 million and contract termination costs of approximately $0.2 million for
the year ended December 31, 2005. 20




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Amounts recorded during 2006 resulted in a net gain of approximately $0.1 million, including the
gain realized upon the final sale of the facility, partially offset by other non-recurring
expenses associated with the closure of the facility.(5)
    
    The years ended January 1, 2005 and January 3, 2004 include the write-off of $2.8 million and
$3.9 million, respectively, of debt issuance costs as a result of amending and restating the
Companys credit facility.(6)
    
    Recapitalization transaction costs include $16.3 million of investment banking, legal and
other expenses incurred as a result of the December 2004 recapitalization transaction. 21




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ITEM 7 . MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 OVERVIEW
 ® ® ®
    22




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RESULTS OF OPERATIONS
  Years EndedDecember 29,
    
    
    December 30,
    
    
    December 31,2007
    
    
    2006
    
    
    2005% of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % ofTotal
    
    
    
    
    
    
    Total
    
    
    
    
    
    
    TotalAmount
    
    
    Net Sales
    
    
    Amount
    
    
    Net Sales
    
    
    Amount
    
    
    Net SalesNet sales
    
    $
    1,204,056
    
    
    
    100.0
    %
    
    $
    1,250,054
    
    
    
    100.0
    %
    
    $
    1,173,591
    
    
    
    100.0
    %Gross profit
    
    
    304,217
    
    
    
    25.3
    
    
    
    302,278
    
    
    
    24.2
    
    
    
    267,324
    
    
    
    22.8Selling, general and
administrative expense
    
    
    208,001
    
    
    
    17.3
    
    
    
    203,844
    
    
    
    16.3
    
    
    
    198,493
    
    
    
    16.9Impairment of long-lived
assets
    
    
    
    
    
    
    
    
    
    
    3,423
    
    
    
    0.3
    
    
    
    
    
    
    
    Facility closure costs, net
    
    
    
    
    
    
    
    
    
    
    (92
    )
    
    
    0.0
    
    
    
    3,956
    
    
    
    0.3Income from operations
    
    
    96,216
    
    
    
    8.0
    
    
    
    95,103
    
    
    
    7.6
    
    
    
    64,875
    
    
    
    5.5Interest expense, net
    
    
    27,943
    
    
    
    
    
    
    
    32,413
    
    
    
    
    
    
    
    31,922Foreign currency (gain)
loss
    
    
    (227
    )
    
    
    
    
    
    
    (703
    )
    
    
    
    
    
    
    781Income before income taxes
    
    
    68,500
    
    
    
    
    
    
    
    63,393
    
    
    
    
    
    
    
    32,172Income taxes
    
    
    28,845
    
    
    
    
    
    
    
    30,096
    
    
    
    
    
    
    
    9,709Net income
    
    $
    39,655
    
    
    
    
    
    
    $
    33,297
    
    
    
    
    
    
    $
    22,463Other Data:EBITDA(1)
    
    $
    118,505
    
    
    
    
    
    
    $
    117,953
    
    
    
    
    
    
    $
    84,569Adjusted EBITDA(1)
    
    
    121,606
    
    
    
    
    
    
    
    123,193
    
    
    
    
    
    
    
    93,625Depreciation and
amortization
    
    
    22,062
    
    
    
    
    
    
    
    22,147
    
    
    
    
    
    
    
    20,475Capital expenditures
    
    
    12,393
    
    
    
    
    
    
    
    14,648
    
    
    
    
    
    
    
    20,959
 23




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Years EndedDecember 29,
    
    
    December 30,
    
    
    December 31,2007
    
    
    2006
    
    
    2005Vinyl windows
    
    $
    418,106
    
    
    $
    411,295
    
    
    $
    377,411Vinyl siding products
    
    
    285,785
    
    
    
    327,961
    
    
    
    325,048Metal products
    
    
    220,189
    
    
    
    224,676
    
    
    
    205,426Third party manufactured products
    
    
    203,711
    
    
    
    194,126
    
    
    
    177,839Other products and services
    
    
    76,265
    
    
    
    91,996
    
    
    
    87,867$
    1,204,056
    
    
    $
    1,250,054
    
    
    $
    1,173,591
 
 (1)
    
    EBITDA is calculated as net income plus interest, taxes, depreciation and amortization.
Adjusted EBITDA excludes certain items. The Company considers adjusted EBITDA to be an
important indicator of its operational strength and performance of its business. The Company
has included adjusted EBITDA because it is a key financial measure used by management to (i)
assess the Companys ability to service its debt and / or incur debt and meet the Companys
capital expenditure requirements; (ii) internally measure the Companys operating performance;
and (iii) determine the Companys incentive compensation programs. In addition, the Companys
credit facility has certain covenants that use ratios utilizing this measure of adjusted
EBITDA. Adjusted EBITDA has not been prepared in accordance with U.S. generally accepted
accounting principles (GAAP). Adjusted EBITDA as presented by the Company may not be
comparable to similarly titled measures reported by other companies. Adjusted EBITDA is not a
measure determined in accordance with GAAP and should not be considered as an alternative to,
or more meaningful than, net income (as determined in accordance with GAAP) as a measure of
the Companys operating results or cash flows from operations (as determined in accordance
with GAAP) as a measure of the Companys liquidity. The reconciliation of the Companys net
income to EBITDA and adjusted EBITDA is as follows (in thousands): Years EndedDecember 29,
    
    
    December 30,
    
    
    December 31,2007
    
    
    2006
    
    
    2005Net income
    
    $
    39,655
    
    
    $
    33,297
    
    
    $
    22,463Interest expense, net
    
    
    27,943
    
    
    
    32,413
    
    
    
    31,922Income taxes
    
    
    28,845
    
    
    
    30,096
    
    
    
    9,709Depreciation and amortization
    
    
    22,062
    
    
    
    22,147
    
    
    
    20,475EBITDA
    
    
    118,505
    
    
    
    117,953
    
    
    
    84,569Foreign currency (gain) loss
    
    
    (227
    )
    
    
    (703
    )
    
    
    781Amortization of management fee (i)
    
    
    500
    
    
    
    500
    
    
    
    4,000Transaction costs (ii)
    
    
    1,168
    
    
    
    
    
    
    
    Tax restructuring costs (iii)
    
    
    961
    
    
    
    
    
    
    
    Stock compensation expense
    
    
    
    
    
    
    27
    
    
    
    319Facility closure costs, net (iv)
    
    
    
    
    
    
    (92
    )
    
    
    3,956Separation costs (v)
    
    
    699
    
    
    
    2,085
    
    
    
    Impairment charges (vi)
    
    
    
    
    
    
    3,423
    
    
    
    Adjusted EBITDA
    
    $
    121,606
    
    
    $
    123,193
    
    
    $
    93,625
 
 (i)
    
    Represents amortization of a prepaid management fee paid to Investcorp International Inc. in
connection with the December 2004 recapitalization transaction.(ii)
    
    Represents legal and accounting fees incurred in connection with an unsuccessful bid for an
acquisition target.(iii)
    
    Represents legal and accounting fees incurred in connection with a tax restructuring project
to reduce AMH IIs consolidated income tax obligations. 24




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(iv)
    
    Represents one-time costs associated with the closure of the Freeport, Texas manufacturing
facility consisting primarily of asset impairments and equipment relocation expenses. Total
pre-tax expenses related to the Freeport closing were $8.4 million.(v)
    
    For the fiscal year ended December 29, 2007, amount represents separation costs, including
payroll taxes, related to the resignation of Mr. Deighton, former Chief Operating Officer of
the Company. For the fiscal year ended December 30, 2006, amount represents separation costs,
including payroll taxes and benefits, related to the resignation of Mr. Caporale, former
Chairman, President and Chief Executive Officer of the Company by mutual agreement with the
Board of Directors.(vi)
    
    Based on current and projected operating results for its vinyl fencing and railing product
lines, the Company concluded that certain machinery and equipment, trademarks, and patents
used to manufacture these products were impaired during the fourth quarter of 2006 as their
carrying values exceeded their fair value by $2.6 million. In addition, due to changes in the
Companys information technology and business strategies, $0.8 million of software and other
equipment was considered impaired. YEAR ENDED DECEMBER 29, 2007 COMPARED TO YEAR ENDED DECEMBER 30, 2006
     25




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YEAR ENDED DECEMBER 30, 2006 COMPARED TO YEAR ENDED DECEMBER 31, 2005
    26




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® ®
     27




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QUARTERLY FINANCIAL DATA
   Three Months EndedMarch 31
    
    June 30
    
    September 29
    
    December 292007Net sales
    
    $
    218,164
    
    
    $
    337,951
    
    
    $
    349,603
    
    
    $
    298,338Gross profit
    
    
    47,716
    
    
    
    91,066
    
    
    
    91,557
    
    
    
    73,878Selling, general and administrative expenses(1)
    
    
    49,100
    
    
    
    53,244
    
    
    
    53,128
    
    
    
    52,529Income (loss) from operations
    
    
    (1,384
    )
    
    
    37,822
    
    
    
    38,429
    
    
    
    21,349Net income (loss)
    
    
    (4,638
    )
    
    
    17,019
    
    
    
    17,399
    
    
    
    9,875
 Three Months EndedApril 1
    
    July 1
    
    September 30
    
    December 302006Net sales
    
    $
    259,280
    
    
    $
    348,329
    
    
    $
    343,402
    
    
    $
    299,043Gross profit
    
    
    59,104
    
    
    
    87,241
    
    
    
    85,095
    
    
    
    70,838Selling, general and administrative expenses(2)
    
    
    51,014
    
    
    
    52,453
    
    
    
    50,692
    
    
    
    49,685Impairment charges
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,423Facility closure costs, net
    
    
    
    
    
    
    (92
    )
    
    
    
    
    
    
    Income from operations
    
    
    8,090
    
    
    
    34,880
    
    
    
    34,403
    
    
    
    17,730Net income
    
    
    116
    
    
    
    16,274
    
    
    
    14,584
    
    
    
    2,323
 
 (1)
    
    Selling, general and administrative expenses includes $0.7 million of separation costs
related to the resignation of the Companys former Chief Operating Officer during the first
quarter of fiscal 2007, $1.2 million of transaction costs during the third quarter of fiscal
2007, and $1.0 million of tax restructuring costs during the fourth quarter of fiscal 2007.(2)
    
    Selling, general and administrative expenses during the first quarter of fiscal 2006 includes
$2.1 million of separation costs related to the resignation of the Companys former Chief
Executive Officer. LIQUIDITY AND CAPITAL RESOURCES
  Years EndedDecember 29,
    
    December 30,
    
    December 31,2007
    
    2006
    
    2005Net cash provided by operating activities
    
    $
    71,351
    
    
    $
    68,300
    
    
    $
    47,897Net cash used in investing activities
    
    
    (13,175
    )
    
    
    (11,740
    )
    
    
    (20,877
    )Net cash used in financing activities
    
    
    (53,018
    )
    
    
    (53,863
    )
    
    
    (72,882
    )
 28




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CASH FLOWS
  CASH FLOWS FROM OPERATING ACTIVITIES
   CASH FLOWS FROM INVESTING ACTIVITIES
    29




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CASH FLOWS FROM FINANCING ACTIVITIES
     DESCRIPTION OF THE COMPANYS OUTSTANDING INDEBTEDNESS
    30




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31




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CONTRACTUAL OBLIGATIONS
  Payments Due by Period2009 
    
    2011 
    
    AfterTotal
    
    2008
    
    2010
    
    2012
    
    2012Long-term debt (1)
    
    $
    226,000
    
    
    $
    
    
    
    $
    61,000
    
    
    $
    165,000
    
    
    $
    Interest payments on 9 3/4% notes
    
    
    72,393
    
    
    
    16,088
    
    
    
    32,175
    
    
    
    24,130
    
    
    
    Interest payments on term loan portion of credit facility (2)
    
    
    10,706
    
    
    
    4,508
    
    
    
    6,198
    
    
    
    
    
    
    
    Operating leases (3)
    
    
    140,721
    
    
    
    32,830
    
    
    
    47,876
    
    
    
    28,213
    
    
    
    31,802Expected pension contributions (4)
    
    
    35,482
    
    
    
    8,208
    
    
    
    15,029
    
    
    
    12,245
    
    
    
    
 
 (1)
    
    Represents principal amounts, but not interest. The Companys long-term debt consists of the
second amended and restated credit facility and the 9 3/4% notes. See Note 7 to the
consolidated financial statements.(2)
    
    Future interest payments on the Companys term loan were calculated assuming no principal
payments until the required quarterly principal payments that begin in December 2009. The
interest rate used for the calculation was 7.39%, calculated as the weighted average interest
rate of the outstanding borrowings at December 29, 2007 including a margin of 2.50%, which
represents the required margin based on the 2006 amendment to the credit facility.(3)
    
    For additional information on the Companys operating leases, see Note 8 to the consolidated
financial statements.(4)
    
    Although subject to change, the amounts set forth in the table above represent the estimated
minimum funding requirements under current law. Due to uncertainties regarding significant
assumptions involved in estimating future required contributions to the Companys pension and
other post-employment benefit plans, including: (i) interest rate levels, (ii) the amount and
timing of asset returns, and (iii) what, if any, changes may occur in pension funding
legislation, the estimates in the table may differ materially from actual future payments. The
Company can not reasonably estimate payments beyond 2012.  32




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OFF-BALANCE SHEET ARRANGEMENTS
    RELATED PARTY TRANSACTIONS
   33




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EFFECTS OF INFLATION
  RECENT ACCOUNTING PRONOUNCEMENTS
   34




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APPLICATION OF CRITICAL ACCOUNTING POLICIES
   Revenue Recognition
 Accounts Receivable
 Inventories
 Goodwill and Other Intangible Assets
 35




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##### Table of Contents



Pensions
 Product Warranty Costs and Service Returns
 CERTAIN FORWARD-LOOKING STATEMENTS
  
    
    the Companys operations and results of operations;
    
    changes in home building industry, economic conditions, interest rates, foreign
currency exchange rates and other conditions;
    
    changes in availability of consumer credit, employment trends, levels of consumer
confidence and consumer preferences;
    
    changes in raw material costs and availability;
    
    market acceptance of price increases;
    
    changes in national and regional trends in new housing starts and home remodeling;
    
    changes in weather conditions;
    
    the Companys ability to comply with certain financial covenants in the loan documents
governing its indebtedness;
 36




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##### Table of Contents




    
    the Companys ability to make distributions, payments or loans to its parent companies
to allow them to make required payments on their debt;
    
    increases in competition from other manufacturers of vinyl and metal exterior
residential building products as well as alternative building products;
    
    shifts in market demand;
    
    increases in the Companys indebtedness;
    
    increases in costs of environmental compliance;
    
    increases in capital expenditure requirements;
    
    potential conflict between existing Alside and Gentek distribution channels; and
    
    the other factors discussed under Item 1A. Risk Factors and elsewhere in this report.
  
 ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 INTEREST RATE RISK
   FOREIGN CURRENCY EXCHANGE RATE RISK
  37




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COMMODITY PRICE RISK
  38




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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 ASSOCIATED MATERIALS, LLC
 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
 PageReport of Independent Registered Public Accounting Firm
    
    40Consolidated Balance Sheets as of December 29, 2007 and December 30, 2006
    
    41Consolidated Statements of Operations for the Years Ended December 29, 2007, December 30, 2006 and December 31, 2005
    
    42Consolidated Statements of Members Equity and Comprehensive Income for the Years Ended December 29, 2007, December 30, 2006 and December 31, 2005
    
    43Consolidated Statements of Cash Flows for the Years Ended December 29, 2007, December 30, 2006 and December 31, 2005
    
    44Notes to Consolidated Financial Statements
    
    45
 39




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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
     ERNST & YOUNG LLP 
 40




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##### Table of Contents



ASSOCIATED MATERIALS, LLC
 December 29,
    
    
    December 30,2007
    
    
    2006ASSETSCurrent assets:Cash and cash equivalents
    
    $
    21,603
    
    
    $
    15,015Accounts receivable, net of allowance for
doubtful accounts of $9,363 at December 29, 2007
and $8,698 at December 30, 2006
    
    
    138,653
    
    
    
    135,539Inventories
    
    
    137,015
    
    
    
    134,319Deferred income taxes
    
    
    9,983
    
    
    
    8,787Other current assets
    
    
    11,686
    
    
    
    9,645Total current assets
    
    
    318,940
    
    
    
    303,305Property, plant and equipment, net
    
    
    133,531
    
    
    
    134,290Goodwill
    
    
    231,213
    
    
    
    231,332Other intangible assets, net
    
    
    102,424
    
    
    
    105,541Other assets
    
    
    7,831
    
    
    
    11,863Total assets
    
    $
    793,939
    
    
    $
    786,331LIABILITIES AND MEMBERS EQUITYCurrent liabilities:Accounts payable
    
    $
    80,082
    
    
    $
    78,492Payable to parent
    
    
    5,029
    
    
    
    763Accrued liabilities
    
    
    64,618
    
    
    
    64,764Income taxes payable
    
    
    11,661
    
    
    
    8,264Total current liabilities
    
    
    161,390
    
    
    
    152,283Deferred income taxes
    
    
    50,837
    
    
    
    50,928Other liabilities
    
    
    47,615
    
    
    
    46,046Long-term debt
    
    
    226,000
    
    
    
    271,000Commitments and contingenciesMembers equity:Common stock, $0.01 par value:Authorized shares  1,000 at December 30, 2006Issued shares  100 at December 30, 2006
    
    
    
    
    
    
    Capital in excess of par
    
    
    
    
    
    
    233,750Membership interest
    
    
    233,750
    
    
    
    Accumulated other comprehensive income (loss)
    
    
    7,179
    
    
    
    (3,207
    )Retained earnings
    
    
    67,168
    
    
    
    35,531Total members equity
    
    
    308,097
    
    
    
    266,074Total liabilities and members equity
    
    $
    793,939
    
    
    $
    786,331
  41




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ASSOCIATED MATERIALS, LLC
 Years EndedDecember 29,
    
    
    December 30,
    
    
    December 31,2007
    
    
    2006
    
    
    2005Net sales
    
    $
    1,204,056
    
    
    $
    1,250,054
    
    
    $
    1,173,591Cost of sales
    
    
    899,839
    
    
    
    947,776
    
    
    
    906,267Gross profit
    
    
    304,217
    
    
    
    302,278
    
    
    
    267,324Selling, general and administrative expenses
    
    
    208,001
    
    
    
    203,844
    
    
    
    198,493Impairment of long-lived assets
    
    
    
    
    
    
    3,423
    
    
    
    Facility closure costs, net
    
    
    
    
    
    
    (92
    )
    
    
    3,956Income from operations
    
    
    96,216
    
    
    
    95,103
    
    
    
    64,875Interest expense, net
    
    
    27,943
    
    
    
    32,413
    
    
    
    31,922Foreign currency (gain) loss
    
    
    (227
    )
    
    
    (703
    )
    
    
    781Income before income taxes
    
    
    68,500
    
    
    
    63,393
    
    
    
    32,172Income taxes
    
    
    28,845
    
    
    
    30,096
    
    
    
    9,709Net income
    
    $
    39,655
    
    
    $
    33,297
    
    
    $
    22,463
  42




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##### Table of Contents



ASSOCIATED MATERIALS, LLC
 AccumulatedOtherCapital in
    
    
    
    
    
    
    Comprehensive
    
    
    TotalCommon Stock
    
    
    Members
    
    
    Excess
    
    
    Retained
    
    
    Income
    
    
    MembersShares
    
    
    Amount
    
    
    Interest
    
    
    Of Par
    
    
    Earnings
    
    
    (Loss)
    
    
    EquityBalance at January 1, 2005
    
    
    
    
    
    $
    
    
    
    $
    
    
    
    $
    233,404
    
    
    $
    25,781
    
    
    $
    1,131
    
    
    $
    260,316Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,463
    
    
    
    
    
    
    
    22,463Minimum pension liability
adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,687
    )
    
    
    (2,687
    )Foreign currency
translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,365
    
    
    
    2,365Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,141Impact of stock option exercise
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    319
    
    
    
    
    
    
    
    
    
    
    
    319Dividends to parent company
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (38,275
    )
    
    
    
    
    
    
    (38,275
    )Balance at December 31, 2005
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    233,723
    
    
    
    9,969
    
    
    
    809
    
    
    
    244,501Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    33,297
    
    
    
    
    
    
    
    33,297Minimum pension liability
adjustment, prior to
adoption of SFAS 158
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,237
    
    
    
    1,237Foreign currency
translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (991
    )
    
    
    (991
    )Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    33,543Effect of adoption of SFAS 158
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,262
    )
    
    
    (4,262
    )Stock option compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    27
    
    
    
    
    
    
    
    
    
    
    
    27Dividends to parent company
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (7,735
    )
    
    
    
    
    
    
    (7,735
    )Balance at December 30, 2006
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    233,750
    
    
    
    35,531
    
    
    
    (3,207
    )
    
    
    266,074Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    39,655
    
    
    
    
    
    
    
    39,655Unrecognized prior service
cost and net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (755
    )
    
    
    (755
    )Foreign currency
translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,141
    
    
    
    11,141Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    50,041Conversion to limited
liability corporation
    
    
    
    
    
    
    
    
    
    
    233,750
    
    
    
    (233,750
    )
    
    
    
    
    
    
    
    
    
    
    Dividends to parent company
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (8,018
    )
    
    
    
    
    
    
    (8,018
    )Balance at December 29, 2007
    
    
    
    
    
    $
    
    
    
    $
    233,750
    
    
    $
    
    
    
    $
    67,168
    
    
    $
    7,179
    
    
    $
    308,097
  43




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##### Table of Contents



ASSOCIATED MATERIALS, LLC
 Years EndedDecember 29,
    
    
    December 30,
    
    
    December 31,2007
    
    
    2006
    
    
    2005OPERATING ACTIVITIESNet income
    
    $
    39,655
    
    
    $
    33,297
    
    
    $
    22,463Adjustments to reconcile net income to net
cash provided by operating activities:Depreciation and amortization
    
    
    22,062
    
    
    
    22,147
    
    
    
    20,475Deferred income taxes
    
    
    (1,310
    )
    
    
    3,022
    
    
    
    (2,328
    )Provision for losses on accounts receivable
    
    
    3,316
    
    
    
    3,043
    
    
    
    3,498(Gain) loss on sale of assets
    
    
    481
    
    
    
    (315
    )
    
    
    23Impairment of long-lived assets
    
    
    
    
    
    
    3,423
    
    
    
    Stock option compensation expense
    
    
    
    
    
    
    27
    
    
    
    319Receivable from parent
    
    
    
    
    
    
    
    
    
    
    (418
    )Amortization of deferred financing costs
    
    
    3,406
    
    
    
    4,206
    
    
    
    3,864Amortization of management fee
    
    
    500
    
    
    
    500
    
    
    
    4,000Changes in operating assets and
liabilities, adjusted for the effects of
the acquisition of supply center:Accounts receivable
    
    
    (2,168
    )
    
    
    9,005
    
    
    
    (22,218
    )Inventories
    
    
    3,619
    
    
    
    (1,002
    )
    
    
    (18,382
    )Other current assets
    
    
    (2,134
    )
    
    
    471
    
    
    
    (1,313
    )Accounts payable
    
    
    (2,474
    )
    
    
    (19,406
    )
    
    
    20,963Accrued liabilities
    
    
    (1,487
    )
    
    
    7,133
    
    
    
    988Income taxes receivable/payable
    
    
    7,576
    
    
    
    4,511
    
    
    
    16,760Other assets
    
    
    1,516
    
    
    
    (572
    )
    
    
    (535
    )Other liabilities
    
    
    (1,207
    )
    
    
    (1,190
    )
    
    
    (262
    )Net cash provided by operating activities
    
    
    71,351
    
    
    
    68,300
    
    
    
    47,897INVESTING ACTIVITIESAdditions to property, plant and equipment
    
    
    (12,393
    )
    
    
    (14,648
    )
    
    
    (20,959
    )Acquisition of supply center
    
    
    (801
    )
    
    
    
    
    
    
    Proceeds from sale of assets
    
    
    19
    
    
    
    2,908
    
    
    
    82Net cash used in investing activities
    
    
    (13,175
    )
    
    
    (11,740
    )
    
    
    (20,877
    )FINANCING ACTIVITIESRepayments of term loan
    
    
    (45,000
    )
    
    
    (46,000
    )
    
    
    (23,000
    )Financing costs
    
    
    
    
    
    
    (128
    )
    
    
    Settlement of promissory notes
    
    
    
    
    
    
    
    
    
    
    (11,607
    )Dividends paid
    
    
    (8,018
    )
    
    
    (7,735
    )
    
    
    (38,275
    )Net cash used in financing activities
    
    
    (53,018
    )
    
    
    (53,863
    )
    
    
    (72,882
    )Effect of exchange rate changes on cash
    
    
    1,430
    
    
    
    18
    
    
    
    108Net increase (decrease) in cash
    
    
    6,588
    
    
    
    2,715
    
    
    
    (45,754
    )Cash at beginning of period
    
    
    15,015
    
    
    
    12,300
    
    
    
    58,054Cash at end of period
    
    $
    21,603
    
    
    $
    15,015
    
    
    $
    12,300Supplemental Information:Cash paid for interest
    
    $
    24,741
    
    
    $
    28,649
    
    
    $
    27,715Cash paid (received) for income taxes
    
    $
    22,594
    
    
    $
    22,423
    
    
    $
    (4,821
    )
  44




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##### Table of Contents



ASSOCIATED MATERIALS, LLC
 1. ACCOUNTING POLICIES
 NATURE OF OPERATIONS
  BASIS OF PRESENTATION
   PRINCIPLES OF CONSOLIDATION
  USE OF ESTIMATES
  REVENUE RECOGNITION
  CASH AND CASH EQUIVALENTS
  45




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##### Table of Contents



ACCOUNTS RECEIVABLE
  Years EndedDecember 29,
    
    
    December 30,
    
    
    December 31,2007
    
    
    2006
    
    
    2005Balance at beginning of period
    
    $
    8,698
    
    
    $
    8,567
    
    
    $
    7,391Provision for losses
    
    
    3,316
    
    
    
    3,043
    
    
    
    3,498Losses sustained (net of recoveries)
    
    
    (2,651
    )
    
    
    (2,912
    )
    
    
    (2,322
    )Balance at end of period
    
    $
    9,363
    
    
    $
    8,698
    
    
    $
    8,567
 INVENTORIES
   PROPERTY, PLANT AND EQUIPMENT
  Building and improvements
    
    
    7 to 40 yearsComputer equipment
    
    
    3 to 5 yearsMachinery and equipment
    
    
    3 to 15 years
 LONG-LIVED ASSETS WITH DEPRECIABLE OR AMORTIZABLE LIVES
  GOODWILL AND OTHER INTANGIBLE ASSETS WITH INDEFINITE LIVES
  46




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PRODUCT WARRANTY COSTS AND SERVICE RETURNS
   December 29,
    
    
    December 30,
    
    
    December 31,2007
    
    
    2006
    
    
    2005Balance at the beginning of the year
    
    $
    25,035
    
    
    $
    21,739
    
    
    $
    21,579Provision for warranties issued
    
    
    13,219
    
    
    
    11,289
    
    
    
    8,011Claims paid
    
    
    (9,570
    )
    
    
    (7,993
    )
    
    
    (7,851
    )Balance at the end of the year
    
    $
    28,684
    
    
    $
    25,035
    
    
    $
    21,739
 INCOME TAXES
  DERIVATIVES AND HEDGING ACTIVITIES
  STOCK PLANS
  47




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##### Table of Contents



COST OF SALES AND SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
   LEASE OBLIGATIONS
 .
 MARKETING AND ADVERTISING
  FOREIGN CURRENCY TRANSLATION
  48




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##### Table of Contents



RECENT ACCOUNTING PRONOUNCEMENTS
    2. RELATED PARTIES
   49




---



##### Table of Contents



3. INVENTORIES
  December 29,
    
    
    December 30,2007
    
    
    2006Raw materials
    
    $
    31,886
    
    
    $
    30,406Work-in-progress
    
    
    10,075
    
    
    
    11,867Finished goods and purchased stock
    
    
    95,054
    
    
    
    92,046$
    137,015
    
    
    $
    134,319
 4. GOODWILL AND OTHER INTANGIBLE ASSETS
  Average
    
    
    December 29, 2007
    
    
    December 30, 2006Amortization
    
    
    
    
    
    
    
    
    
    
    Net
    
    
    
    
    
    
    
    
    
    
    NetPeriod
    
    
    
    
    
    
    Accumulated
    
    
    Carrying
    
    
    
    
    
    
    Accumulated
    
    
    Carrying(In Years)
    
    
    Cost
    
    
    Amortization
    
    
    Value
    
    
    Cost
    
    
    Amortization
    
    
    ValueTrademarks and trade names
    
    
    15
    
    
    $
    108,080
    
    
    $
    10,283
    
    
    $
    97,797
    
    
    $
    108,290
    
    
    $
    8,449
    
    
    $
    99,841Patents
    
    
    10
    
    
    
    6,230
    
    
    
    3,540
    
    
    
    2,690
    
    
    
    6,230
    
    
    
    2,918
    
    
    
    3,312Customer base
    
    
    7
    
    
    
    5,298
    
    
    
    3,361
    
    
    
    1,937
    
    
    
    4,818
    
    
    
    2,430
    
    
    
    2,388Total other intangible assets
    
    
    
    
    
    $
    119,608
    
    
    $
    17,184
    
    
    $
    102,424
    
    
    $
    119,338
    
    
    $
    13,797
    
    
    $
    105,541
 ® ® ® ® ®
 50




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##### Table of Contents



5. PROPERTY, PLANT AND EQUIPMENT
  December 29,
    
    
    December 30,2007
    
    
    2006Land
    
    $
    6,191
    
    
    $
    5,650Buildings
    
    
    57,327
    
    
    
    50,476Construction in process
    
    
    4,567
    
    
    
    1,607Machinery and equipment
    
    
    145,876
    
    
    
    139,999213,961
    
    
    
    197,732Less accumulated depreciation
    
    
    80,430
    
    
    
    63,442$
    133,531
    
    
    $
    134,290
   6. ACCRUED AND OTHER LIABILITIES
  December 29,
    
    
    December 30,2007
    
    
    2006Employee compensation
    
    $
    17,247
    
    
    $
    19,728Sales promotions and incentives
    
    
    18,575
    
    
    
    18,152Warranty reserves
    
    
    7,976
    
    
    
    6,863Employee benefits
    
    
    6,280
    
    
    
    7,403Interest
    
    
    3,611
    
    
    
    3,728Taxes other than income
    
    
    3,727
    
    
    
    4,252Other
    
    
    7,202
    
    
    
    4,638$
    64,618
    
    
    $
    64,764
 51




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##### Table of Contents



December 29,
    
    
    December 30,2007
    
    
    2006Pensions and other postretirement plans
    
    $
    26,846
    
    
    $
    27,259Warranty reserves
    
    
    20,708
    
    
    
    18,172Other
    
    
    61
    
    
    
    615$
    47,615
    
    
    $
    46,046
 7. LONG-TERM DEBT
  December 29,
    
    
    December 30,2007
    
    
    20069 3/4% notes
    
    $
    165,000
    
    
    $
    165,000Term loan under credit facility
    
    
    61,000
    
    
    
    106,000Total long-term debt
    
    $
    226,000
    
    
    $
    271,000
     52




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53




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##### Table of Contents



8. COMMITMENTS AND CONTINGENCIES
  2008
    
    $
    32,8302009
    
    
    27,5522010
    
    
    20,3242011
    
    
    15,1682012
    
    
    13,045Thereafter
    
    
    31,802Total future minimum lease payments
    
    $
    140,721
    9. INCOME TAXES
  Years EndedDecember 29, 2007
    
    
    December 30, 2006
    
    
    December 31, 2005Current
    
    
    Deferred
    
    
    Current
    
    
    Deferred
    
    
    Current
    
    
    DeferredFederal
    
    $
    16,024
    
    
    $
    (2,419
    )
    
    $
    13,348
    
    
    $
    4,385
    
    
    $
    3,903
    
    
    $
    1,012State
    
    
    1,711
    
    
    
    544
    
    
    
    3,216
    
    
    
    (775
    )
    
    
    1,327
    
    
    
    (3,417
    )Foreign
    
    
    12,420
    
    
    
    565
    
    
    
    10,510
    
    
    
    (588
    )
    
    
    6,807
    
    
    
    77$
    30,155
    
    
    $
    (1,310
    )
    
    $
    27,074
    
    
    $
    3,022
    
    
    $
    12,037
    
    
    $
    (2,328
    )
  54




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December 29,
    
    
    December 30,2007
    
    
    2006Deferred tax assets:Medical benefits
    
    $
    2,373
    
    
    $
    2,726Bad debt expense
    
    
    3,802
    
    
    
    3,438Pension and other postretirement plans
    
    
    7,087
    
    
    
    7,340Inventory costs
    
    
    1,854
    
    
    
    1,841Interest
    
    
    1,691
    
    
    
    2,071Warranty costs
    
    
    10,719
    
    
    
    9,492Net operating loss carryforward
    
    
    1,786
    
    
    
    3,313Foreign tax credit carryforward
    
    
    4,435
    
    
    
    Accrued expenses and other
    
    
    2,686
    
    
    
    2,508Valuation allowance
    
    
    (4,435
    )
    
    
    Total deferred tax assets
    
    
    31,998
    
    
    
    32,729Deferred tax liabilities:Depreciation
    
    
    27,006
    
    
    
    27,629Intangible assets
    
    
    39,536
    
    
    
    40,687Tax liability on unremitted foreign earnings
    
    
    6,310
    
    
    
    6,554Total deferred tax liabilities
    
    
    72,852
    
    
    
    74,870Net deferred tax liabilities
    
    $
    (40,854
    )
    
    $
    (42,141
    )
    Years EndedDecember 29,
    
    
    December 30,
    
    
    December 31,2007
    
    
    2006
    
    
    2005Statutory rate
    
    
    35.0
    %
    
    
    35.0
    %
    
    
    35.0
    %State income tax, net of federal income tax benefit
    
    
    2.3
    
    
    
    2.5
    
    
    
    (8.3
    )Non-deductible merger transaction costs
    
    
    
    
    
    
    
    
    
    
    (3.3
    )Tax liability on remitted and unremitted foreign earnings
    
    
    7.3
    
    
    
    10.3
    
    
    
    6.5Foreign rate differential
    
    
    (0.2
    )
    
    
    (0.4
    )
    
    
    (1.4
    )Other
    
    
    (2.3
    )
    
    
    0.1
    
    
    
    1.7Effective rate
    
    
    42.1
    %
    
    
    47.5
    %
    
    
    30.2
    %
  55




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##### Table of Contents



December 29,2007Unrecognized tax benefits, beginning of year
    
    $
    1,596Gross increases for tax positions of prior years
    
    
    Gross decreases for tax positions of prior years
    
    
    (874
    )Settlements
    
    
    (209
    )Lapse of statute of limitations
    
    
    Unrecognized tax benefits, end of year
    
    $
    513
    56




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##### Table of Contents



10. MEMBERS EQUITY
     December 29,
    
    
    December 30,
    
    
    December 31,2007
    
    
    2006
    
    
    2005Pension liability adjustments
    
    $
    (12,463
    )
    
    $
    (11,708
    )
    
    $
    (8,683
    )Foreign currency translation adjustments
    
    
    19,642
    
    
    
    8,501
    
    
    
    9,492Accumulated other comprehensive income (loss)
    
    $
    7,179
    
    
    $
    (3,207
    )
    
    $
    809
 57




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##### Table of Contents



11. STOCK PLANS
      58




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##### Table of Contents



Weighted
    
    
    RemainingAverage
    
    
    ContractualShares
    
    
    Exercise Price
    
    
    Term (years)Options outstanding January 1, 2005
    
    
    809,680
    
    
    $
    41.34Granted under 2004 Plan
    
    
    38,950
    
    
    
    65.54Exercised
    
    
    (5,247
    )
    
    
    5.00Expired or canceled
    
    
    (114,530
    )
    
    
    51.31Options outstanding December 31, 2005
    
    
    728,853
    
    
    
    41.33Granted under 2004 Plan
    
    
    25,117
    
    
    
    5.00Exercised
    
    
    
    
    
    
    Expired or canceled
    
    
    (244,958
    )
    
    
    53.40Options outstanding December 30, 2006
    
    
    509,012
    
    
    
    33.73Granted under 2004 Plan
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    Expired or canceled
    
    
    (259,410
    )
    
    
    27.72Options outstanding December 29, 2007
    
    
    249,602
    
    
    $
    39.97
    
    
    
    6.3Options exercisable December 29, 2007
    
    
    96,911
    
    
    $
    10.95
    
    
    
    4.7
    59




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##### Table of Contents



12. FACILITY CLOSURE
  13. BUSINESS SEGMENTS
  Years EndedDecember 29,
    
    
    December 30,
    
    
    December 31,2007
    
    
    2006
    
    
    2005Vinyl windows
    
    $
    418,106
    
    
    $
    411,295
    
    
    $
    377,411Vinyl siding products
    
    
    285,785
    
    
    
    327,961
    
    
    
    325,048Metal products
    
    
    220,189
    
    
    
    224,676
    
    
    
    205,426Third party manufactured products
    
    
    203,711
    
    
    
    194,126
    
    
    
    177,839Other products and services
    
    
    76,265
    
    
    
    91,996
    
    
    
    87,867$
    1,204,056
    
    
    $
    1,250,054
    
    
    $
    1,173,591
  14. RETIREMENT PLANS
   60




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Prior to Adopting
    
    Effect of SFAS 158
    
    As Reported atSFAS 158
    
    Adoption
    
    December 30, 2006Other assets
    
    $
    12,236
    
    
    $
    (373
    )
    
    $
    11,863Accrued employee benefits
    
    
    6,611
    
    
    
    792
    
    
    
    7,403Pension and other postretirement plans
    
    
    21,957
    
    
    
    5,302
    
    
    
    27,259Current deferred income taxes
    
    
    8,483
    
    
    
    304
    
    
    
    8,787Long-term deferred income taxes
    
    
    52,829
    
    
    
    (1,901
    )
    
    
    50,928Accumulated other comprehensive income (loss)
    
    
    1,055
    
    
    
    (4,262
    )
    
    
    (3,207
    )
 61




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##### Table of Contents



2007
    
    
    2006Domestic
    
    
    Foreign
    
    
    Domestic
    
    
    ForeignPlans
    
    
    Plans
    
    
    Plans
    
    
    PlansAccumulated Benefit Obligation
    
    $
    51,053
    
    
    $
    49,716
    
    
    $
    50,428
    
    
    $
    40,963Change In Projected Benefit ObligationProjected benefit obligation at beginning of year
    
    $
    50,873
    
    
    $
    46,746
    
    
    $
    51,122
    
    
    $
    42,519Service cost
    
    
    533
    
    
    
    2,188
    
    
    
    510
    
    
    
    2,007Interest cost
    
    
    2,913
    
    
    
    2,813
    
    
    
    2,784
    
    
    
    2,404Plan amendments
    
    
    190
    
    
    
    
    
    
    
    118
    
    
    
    Actuarial (gain) loss
    
    
    (491
    )
    
    
    (2,177
    )
    
    
    (1,357
    )
    
    
    1,406Employee contributions
    
    
    
    
    
    
    340
    
    
    
    
    
    
    
    333Benefits paid
    
    
    (2,554
    )
    
    
    (1,681
    )
    
    
    (2,304
    )
    
    
    (1,665
    )Effect of foreign exchange
    
    
    
    
    
    
    8,959
    
    
    
    
    
    
    
    (258
    )Projected benefit obligation at end of year
    
    
    51,464
    
    
    
    57,188
    
    
    
    50,873
    
    
    
    46,746Change In Plan AssetsFair value of assets at beginning of year
    
    $
    39,813
    
    
    $
    37,708
    
    
    $
    34,773
    
    
    $
    32,124Actual return on plan assets
    
    
    2,335
    
    
    
    (229
    )
    
    
    3,153
    
    
    
    3,806Employer contributions
    
    
    1,118
    
    
    
    4,049
    
    
    
    4,191
    
    
    
    3,381Employee contributions
    
    
    
    
    
    
    340
    
    
    
    
    
    
    
    333Benefits paid
    
    
    (2,554
    )
    
    
    (1,681
    )
    
    
    (2,304
    )
    
    
    (1,665
    )Effect of foreign exchange
    
    
    
    
    
    
    7,330
    
    
    
    
    
    
    
    (271
    )Fair value of assets at end of year
    
    
    40,712
    
    
    
    47,517
    
    
    
    39,813
    
    
    
    37,708Funded status
    
    $
    (10,752
    )
    
    $
    (9,671
    )
    
    $
    (11,060
    )
    
    $
    (9,038
    )
  December 31,
    
    December 31,2007
    
    2006Domestic
    
    Foreign
    
    Domestic
    
    ForeignPlans
    
    Plans
    
    Plans
    
    PlansDiscount rate
    
    
    5.93
    %
    
    
    5.50
    %
    
    
    5.76
    %
    
    
    5.25
    %Salary increases
    
    
    3.75
    %
    
    
    3.50
    %
    
    
    3.75
    %
    
    
    3.50
    %
  62




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2007
    
    
    2006
    
    
    2005Domestic
    
    
    Foreign
    
    
    Domestic
    
    
    Foreign
    
    
    Domestic
    
    
    ForeignPlans
    
    
    Plans
    
    
    Plans
    
    
    Plans
    
    
    Plans
    
    
    PlansService cost
    
    $
    533
    
    
    $
    2,188
    
    
    $
    510
    
    
    $
    2,007
    
    
    $
    478
    
    
    $
    1,364Interest cost
    
    
    2,913
    
    
    
    2,813
    
    
    
    2,784
    
    
    
    2,404
    
    
    
    2,651
    
    
    
    2,071Expected return on assets
    
    
    (3,323
    )
    
    
    (3,342
    )
    
    
    (2,982
    )
    
    
    (2,656
    )
    
    
    (2,917
    )
    
    
    (2,177
    )Amortization of unrecognized:Prior service cost
    
    
    23
    
    
    
    31
    
    
    
    10
    
    
    
    29
    
    
    
    
    
    
    
    27Cumulative net loss
    
    
    635
    
    
    
    19
    
    
    
    851
    
    
    
    40
    
    
    
    611
    
    
    
    2Net periodic pension cost
    
    $
    781
    
    
    $
    1,709
    
    
    $
    1,173
    
    
    $
    1,824
    
    
    $
    823
    
    
    $
    1,287
  2007
    
    2006
    
    2005Domestic
    
    Foreign
    
    Domestic
    
    Foreign
    
    Domestic
    
    ForeignPlans
    
    Plans
    
    Plans
    
    Plans
    
    Plans
    
    PlansDiscount rate
    
    
    5.76
    %
    
    
    5.25
    %
    
    
    5.50
    %
    
    
    5.25
    %
    
    
    5.75
    %
    
    
    5.75
    %Long-term rate of return on assets
    
    
    8.50
    %
    
    
    7.75
    %
    
    
    8.50
    %
    
    
    7.75
    %
    
    
    8.75
    %
    
    
    8.00
    %Salary increases
    
    
    3.75
    %
    
    
    3.50
    %
    
    
    3.75
    %
    
    
    3.50
    %
    
    
    
    
    
    
    3.50
    %
   2007
    
    
    2006Domestic
    
    
    Foreign
    
    
    Domestic
    
    
    ForeignPlans
    
    
    Plans
    
    
    Plans
    
    
    PlansASSET ALLOCATIONSEquity securities
    
    
    61
    %
    
    
    58
    %
    
    
    63
    %
    
    
    58
    %Debt securities
    
    
    34
    %
    
    
    35
    %
    
    
    32
    %
    
    
    36
    %Other
    
    
    5
    %
    
    
    7
    %
    
    
    5
    %
    
    
    6
    %Total
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
   Domestic
    
    ForeignPlans
    
    Plans2008
    
    $
    2,234
    
    
    $
    1,6062009
    
    
    2,431
    
    
    
    1,7212010
    
    
    2,562
    
    
    
    2,0162011
    
    
    2,784
    
    
    
    2,2872012
    
    
    3,106
    
    
    
    2,5162013 - 2017
    
    
    17,094
    
    
    
    18,462
 63




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##### Table of Contents



15. SUBSIDIARY GUARANTORS
  ASSOCIATED MATERIALS, LLC AND SUBSIDIARIES
 Guarantor
    
    
    Non-Guarantor
    
    
    ReclassificationParent
    
    
    Subsidiaries
    
    
    Subsidiary
    
    
    /Eliminations
    
    
    ConsolidatedAssetsCurrent assets:Cash and cash equivalents
    
    $
    6,407
    
    
    $
    371
    
    
    $
    14,825
    
    
    $
    
    
    
    $
    21,603Accounts receivable, net
    
    
    92,314
    
    
    
    17,999
    
    
    
    28,340
    
    
    
    
    
    
    
    138,653Intercompany receivables
    
    
    
    
    
    
    33,341
    
    
    
    21,052
    
    
    
    (54,393
    )
    
    
    Inventories
    
    
    85,876
    
    
    
    14,083
    
    
    
    37,056
    
    
    
    
    
    
    
    137,015Income taxes receivable
    
    
    
    
    
    
    3,375
    
    
    
    
    
    
    
    (3,375
    )
    
    
    Deferred income taxes
    
    
    6,886
    
    
    
    2,674
    
    
    
    423
    
    
    
    
    
    
    
    9,983Other current assets
    
    
    8,683
    
    
    
    878
    
    
    
    2,125
    
    
    
    
    
    
    
    11,686Total current assets
    
    
    200,166
    
    
    
    72,721
    
    
    
    103,821
    
    
    
    (57,768
    )
    
    
    318,940Property, plant and equipment, net
    
    
    92,920
    
    
    
    3,592
    
    
    
    37,019
    
    
    
    
    
    
    
    133,531Goodwill
    
    
    194,814
    
    
    
    36,399
    
    
    
    
    
    
    
    
    
    
    
    231,213Other intangible assets, net
    
    
    91,098
    
    
    
    10,559
    
    
    
    767
    
    
    
    
    
    
    
    102,424Investment in subsidiaries
    
    
    170,682
    
    
    
    86,692
    
    
    
    
    
    
    
    (257,374
    )
    
    
    Other assets
    
    
    7,831
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,831Total assets
    
    $
    757,511
    
    
    $
    209,963
    
    
    $
    141,607
    
    
    $
    (315,142
    )
    
    $
    793,939Liabilities And Members EquityCurrent liabilities:Accounts payable
    
    $
    42,268
    
    
    $
    9,981
    
    
    $
    27,833
    
    
    $
    
    
    
    $
    80,082Intercompany payables
    
    
    54,393
    
    
    
    
    
    
    
    
    
    
    
    (54,393
    )
    
    
    Payable to parent
    
    
    5,029
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,029Accrued liabilities
    
    
    43,299
    
    
    
    11,476
    
    
    
    9,843
    
    
    
    
    
    
    
    64,618Income taxes payable
    
    
    13,573
    
    
    
    
    
    
    
    1,463
    
    
    
    (3,375
    )
    
    
    11,661Total current liabilities
    
    
    158,562
    
    
    
    21,457
    
    
    
    39,139
    
    
    
    (57,768
    )
    
    
    161,390Deferred income taxes
    
    
    44,126
    
    
    
    4,316
    
    
    
    2,395
    
    
    
    
    
    
    
    50,837Other liabilities
    
    
    20,726
    
    
    
    13,508
    
    
    
    13,381
    
    
    
    
    
    
    
    47,615Long-term debt
    
    
    226,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    226,000Members equity
    
    
    308,097
    
    
    
    170,682
    
    
    
    86,692
    
    
    
    (257,374
    )
    
    
    308,097Total liabilities and member s equity
    
    $
    757,511
    
    
    $
    209,963
    
    
    $
    141,607
    
    
    $
    (315,142
    )
    
    $
    793,939
 64




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##### Table of Contents



ASSOCIATED MATERIALS, LLC AND SUBSIDIARIES
 Guarantor
    
    
    Non-Guarantor
    
    
    Reclassification/Parent
    
    
    Subsidiaries
    
    
    Subsidiary
    
    
    Elimination
    
    
    ConsolidatedNet sales
    
    $
    840,742
    
    
    $
    216,378
    
    
    $
    312,217
    
    
    $
    (165,281
    )
    
    $
    1,204,056Cost of sales
    
    
    621,439
    
    
    
    203,620
    
    
    
    240,061
    
    
    
    (165,281
    )
    
    
    899,839Gross profit
    
    
    219,303
    
    
    
    12,758
    
    
    
    72,156
    
    
    
    
    
    
    
    304,217Selling, general and
administrative expense
    
    
    155,549
    
    
    
    17,777
    
    
    
    34,675
    
    
    
    
    
    
    
    208,001Income (loss) from operations
    
    
    63,754
    
    
    
    (5,019
    )
    
    
    37,481
    
    
    
    
    
    
    
    96,216Interest expense, net
    
    
    27,645
    
    
    
    69
    
    
    
    229
    
    
    
    
    
    
    
    27,943Foreign currency (gain) loss
    
    
    
    
    
    
    
    
    
    
    (227
    )
    
    
    
    
    
    
    (227
    )Income (loss) before income taxes
    
    
    36,109
    
    
    
    (5,088
    )
    
    
    37,479
    
    
    
    
    
    
    
    68,500Income taxes
    
    
    12,699
    
    
    
    3,161
    
    
    
    12,985
    
    
    
    
    
    
    
    28,845Income (loss) before equity
income from subsidiaries
    
    
    23,410
    
    
    
    (8,249
    )
    
    
    24,494
    
    
    
    
    
    
    
    39,655Equity income from subsidiaries
    
    
    16,245
    
    
    
    24,494
    
    
    
    
    
    
    
    (40,739
    )
    
    
    Net income (loss)
    
    $
    39,655
    
    
    $
    16,245
    
    
    $
    24,494
    
    
    $
    (40,739
    )
    
    $
    39,655
 ASSOCIATED MATERIALS, LLC AND SUBSIDIARIES
 Guarantor
    
    
    Non-GuarantorParent
    
    
    Subsidiaries
    
    
    Subsidiary
    
    
    ConsolidatedNet cash provided by (used in) operating activities
    
    $
    42,537
    
    
    $
    (591
    )
    
    $
    29,405
    
    
    $
    71,351Investing ActivitiesAcquisition of supply center
    
    
    (801
    )
    
    
    
    
    
    
    
    
    
    
    (801
    )Additions to property, plant and equipment
    
    
    (8,991
    )
    
    
    (1,220
    )
    
    
    (2,182
    )
    
    
    (12,393
    )Proceeds from sale of assets
    
    
    19
    
    
    
    
    
    
    
    
    
    
    
    19Net cash used in investing activities
    
    
    (9,773
    )
    
    
    (1,220
    )
    
    
    (2,182
    )
    
    
    (13,175
    )Financing ActivitiesRepayments of term loan
    
    
    (45,000
    )
    
    
    
    
    
    
    
    
    
    
    (45,000
    )Dividends
    
    
    (8,018
    )
    
    
    
    
    
    
    
    
    
    
    (8,018
    )Intercompany transactions
    
    
    16,647
    
    
    
    490
    
    
    
    (17,137
    )
    
    
    Net cash provided by (used in) financing activities
    
    
    (36,371
    )
    
    
    490
    
    
    
    (17,137
    )
    
    
    (53,018
    )Effect of exchange rate changes on cash
    
    
    
    
    
    
    
    
    
    
    1,430
    
    
    
    1,430Net increase (decrease) in cash
    
    
    (3,607
    )
    
    
    (1,321
    )
    
    
    11,516
    
    
    
    6,588Cash at beginning of period
    
    
    10,014
    
    
    
    1,692
    
    
    
    3,309
    
    
    
    15,015Cash at end of period
    
    $
    6,407
    
    
    $
    371
    
    
    $
    14,825
    
    
    $
    21,603
 65




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##### Table of Contents



ASSOCIATED MATERIALS LLC AND SUBSIDIARIES
 Guarantor
    
    
    Non-Guarantor
    
    
    ReclassificationParent
    
    
    Subsidiaries
    
    
    Subsidiary
    
    
    /Eliminations
    
    
    ConsolidatedAssetsCurrent assets:Cash and cash equivalents
    
    $
    10,014
    
    
    $
    1,692
    
    
    $
    3,309
    
    
    $
    
    
    
    $
    15,015Accounts receivable, net
    
    
    93,959
    
    
    
    21,047
    
    
    
    20,533
    
    
    
    
    
    
    
    135,539Intercompany receivables
    
    
    
    
    
    
    33,714
    
    
    
    18,786
    
    
    
    (52,500
    )
    
    
    Inventories
    
    
    84,629
    
    
    
    17,668
    
    
    
    32,022
    
    
    
    
    
    
    
    134,319Income taxes receivable
    
    
    
    
    
    
    5,915
    
    
    
    88
    
    
    
    (6,003
    )
    
    
    Deferred income taxes
    
    
    5,675
    
    
    
    2,694
    
    
    
    418
    
    
    
    
    
    
    
    8,787Other current assets
    
    
    7,154
    
    
    
    1,240
    
    
    
    1,251
    
    
    
    
    
    
    
    9,645Total current assets
    
    
    201,431
    
    
    
    83,970
    
    
    
    76,407
    
    
    
    (58,503
    )
    
    
    303,305Property, plant and equipment, net
    
    
    99,060
    
    
    
    3,225
    
    
    
    32,005
    
    
    
    
    
    
    
    134,290Goodwill
    
    
    194,814
    
    
    
    36,518
    
    
    
    
    
    
    
    
    
    
    
    231,332Other intangible assets, net
    
    
    93,408
    
    
    
    11,189
    
    
    
    944
    
    
    
    
    
    
    
    105,541Investment in subsidiaries
    
    
    144,347
    
    
    
    52,210
    
    
    
    
    
    
    
    (196,557
    )
    
    
    Other assets
    
    
    11,843
    
    
    
    
    
    
    
    20
    
    
    
    
    
    
    
    11,863Total assets
    
    $
    744,903
    
    
    $
    187,112
    
    
    $
    109,376
    
    
    $
    (255,060
    )
    
    $
    786,331Liabilities And Stockholders EquityCurrent liabilities:Accounts payable
    
    $
    43,811
    
    
    $
    15,359
    
    
    $
    19,322
    
    
    $
    
    
    
    $
    78,492Intercompany payables
    
    
    37,744
    
    
    
    
    
    
    
    14,756
    
    
    
    (52,500
    )
    
    
    Payable to parent
    
    
    763
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    763Accrued liabilities
    
    
    49,217
    
    
    
    7,599
    
    
    
    7,948
    
    
    
    
    
    
    
    64,764Income taxes payable
    
    
    14,267
    
    
    
    
    
    
    
    
    
    
    
    (6,003
    )
    
    
    8,264Total current liabilities
    
    
    145,802
    
    
    
    22,958
    
    
    
    42,026
    
    
    
    (58,503
    )
    
    
    152,283Deferred income taxes
    
    
    45,450
    
    
    
    3,560
    
    
    
    1,918
    
    
    
    
    
    
    
    50,928Other liabilities
    
    
    16,577
    
    
    
    16,247
    
    
    
    13,222
    
    
    
    
    
    
    
    46,046Long-term debt
    
    
    271,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    271,000Stockholders equity
    
    
    266,074
    
    
    
    144,347
    
    
    
    52,210
    
    
    
    (196,557
    )
    
    
    266,074Total liabilities and
stockholder s equity
    
    $
    744,903
    
    
    $
    187,112
    
    
    $
    109,376
    
    
    $
    (255,060
    )
    
    $
    786,331
 66




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##### Table of Contents



ASSOCIATED MATERIALS LLC AND SUBSIDIARIES
 Guarantor
    
    
    Non-Guarantor
    
    
    Reclassification/Parent
    
    
    Subsidiaries
    
    
    Subsidiary
    
    
    Elimination
    
    
    ConsolidatedNet sales
    
    $
    883,676
    
    
    $
    241,894
    
    
    $
    291,423
    
    
    $
    (166,939
    )
    
    $
    1,250,054Cost of sales
    
    
    655,071
    
    
    
    226,360
    
    
    
    233,284
    
    
    
    (166,939
    )
    
    
    947,776Gross profit
    
    
    228,605
    
    
    
    15,534
    
    
    
    58,139
    
    
    
    
    
    
    
    302,278Selling, general and
administrative expense
    
    
    157,264
    
    
    
    18,111
    
    
    
    28,469
    
    
    
    
    
    
    
    203,844Impairment of long-lived assets
    
    
    3,423
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,423Facility closure costs, net
    
    
    (92
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (92
    )Income (loss) from operations
    
    
    68,010
    
    
    
    (2,577
    )
    
    
    29,670
    
    
    
    
    
    
    
    95,103Interest expense, net
    
    
    31,540
    
    
    
    
    
    
    
    873
    
    
    
    
    
    
    
    32,413Foreign currency (gain) loss
    
    
    
    
    
    
    
    
    
    
    (703
    )
    
    
    
    
    
    
    (703
    )Income (loss) before income taxes
    
    
    36,470
    
    
    
    (2,577
    )
    
    
    29,500
    
    
    
    
    
    
    
    63,393Income taxes
    
    
    13,967
    
    
    
    6,207
    
    
    
    9,922
    
    
    
    
    
    
    
    30,096Income (loss) before equity
income from subsidiaries
    
    
    22,503
    
    
    
    (8,784
    )
    
    
    19,578
    
    
    
    
    
    
    
    33,297Equity income from subsidiaries
    
    
    10,794
    
    
    
    19,578
    
    
    
    
    
    
    
    (30,372
    )
    
    
    Net income (loss)
    
    $
    33,297
    
    
    $
    10,794
    
    
    $
    19,578
    
    
    $
    (30,372
    )
    
    $
    33,297
 ASSOCIATED MATERIALS LLC AND SUBSIDIARIES
 Guarantor
    
    
    Non-GuarantorParent
    
    
    Subsidiaries
    
    
    Subsidiary
    
    
    ConsolidatedNet cash provided by (used in) operating activities
    
    $
    57,778
    
    
    $
    (637
    )
    
    $
    11,159
    
    
    $
    68,300Investing ActivitiesAdditions to property, plant and equipment
    
    
    (12,193
    )
    
    
    (136
    )
    
    
    (2,319
    )
    
    
    (14,648
    )Proceeds from sale of assets
    
    
    2,849
    
    
    
    
    
    
    
    59
    
    
    
    2,908Net cash used in investing activities
    
    
    (9,344
    )
    
    
    (136
    )
    
    
    (2,260
    )
    
    
    (11,740
    )Financing ActivitiesRepayments of term loan
    
    
    (46,000
    )
    
    
    
    
    
    
    
    
    
    
    (46,000
    )Financing costs
    
    
    (128
    )
    
    
    
    
    
    
    
    
    
    
    (128
    )Dividends
    
    
    (7,735
    )
    
    
    
    
    
    
    
    
    
    
    (7,735
    )Intercompany transactions
    
    
    8,433
    
    
    
    1,419
    
    
    
    (9,852
    )
    
    
    Net cash provided by (used in) financing activities
    
    
    (45,430
    )
    
    
    1,419
    
    
    
    (9,852
    )
    
    
    (53,863
    )Effect of exchange rate changes on cash
    
    
    
    
    
    
    
    
    
    
    18
    
    
    
    18Net increase (decrease) in cash
    
    
    3,004
    
    
    
    646
    
    
    
    (935
    )
    
    
    2,715Cash at beginning of period
    
    
    7,010
    
    
    
    1,046
    
    
    
    4,244
    
    
    
    12,300Cash at end of period
    
    $
    10,014
    
    
    $
    1,692
    
    
    $
    3,309
    
    
    $
    15,015
 67




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##### Table of Contents



ASSOCIATED MATERIALS LLC AND SUBSIDIARIES
 Guarantor
    
    
    Non-Guarantor
    
    
    Reclassification/Parent
    
    
    Subsidiaries
    
    
    Subsidiary
    
    
    Elimination
    
    
    ConsolidatedNet sales
    
    $
    831,495
    
    
    $
    236,594
    
    
    $
    269,453
    
    
    $
    (163,951
    )
    
    $
    1,173,591Cost of sales
    
    
    623,226
    
    
    
    223,672
    
    
    
    223,320
    
    
    
    (163,951
    )
    
    
    906,267Gross profit
    
    
    208,269
    
    
    
    12,922
    
    
    
    46,133
    
    
    
    
    
    
    
    267,324Selling, general and
administrative expense
    
    
    152,773
    
    
    
    20,528
    
    
    
    25,192
    
    
    
    
    
    
    
    198,493Facility closure costs, net
    
    
    3,956
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,956Income (loss) from operations
    
    
    51,540
    
    
    
    (7,606
    )
    
    
    20,941
    
    
    
    
    
    
    
    64,875Interest expense, net
    
    
    31,339
    
    
    
    
    
    
    
    583
    
    
    
    
    
    
    
    31,922Foreign currency (gain) loss
    
    
    
    
    
    
    
    
    
    
    781
    
    
    
    
    
    
    
    781Income (loss) before income taxes
    
    
    20,201
    
    
    
    (7,606
    )
    
    
    19,577
    
    
    
    
    
    
    
    32,172Income taxes
    
    
    2,748
    
    
    
    538
    
    
    
    6,423
    
    
    
    
    
    
    
    9,709Income (loss) before equity
income from subsidiaries
    
    
    17,453
    
    
    
    (8,144
    )
    
    
    13,154
    
    
    
    
    
    
    
    22,463Equity income from subsidiaries
    
    
    5,010
    
    
    
    13,154
    
    
    
    
    
    
    
    (18,164
    )
    
    
    Net income (loss)
    
    $
    22,463
    
    
    $
    5,010
    
    
    $
    13,154
    
    
    $
    (18,164
    )
    
    $
    22,463
 ASSOCIATED MATERIALS LLC AND SUBSIDIARIES
 Guarantor
    
    
    Non-GuarantorParent
    
    
    Subsidiaries
    
    
    Subsidiary
    
    
    ConsolidatedNet cash provided by (used in) operating activities
    
    $
    33,415
    
    
    $
    (9,045
    )
    
    $
    23,527
    
    
    $
    47,897Investing ActivitiesAdditions to property, plant and equipment
    
    
    (19,539
    )
    
    
    (465
    )
    
    
    (955
    )
    
    
    (20,959
    )Proceeds from sale of assets
    
    
    40
    
    
    
    4
    
    
    
    38
    
    
    
    82Net cash used in investing activities
    
    
    (19,499
    )
    
    
    (461
    )
    
    
    (917
    )
    
    
    (20,877
    )Financing ActivitiesRepayments of term loan
    
    
    (23,000
    )
    
    
    
    
    
    
    
    
    
    
    (23,000
    )Settlement of promissory notes
    
    
    (11,607
    )
    
    
    
    
    
    
    
    
    
    
    (11,607
    )Dividends
    
    
    (38,275
    )
    
    
    40,000
    
    
    
    (40,000
    )
    
    
    (38,275
    )Intercompany transactions
    
    
    22,283
    
    
    
    (36,331
    )
    
    
    14,048
    
    
    
    Net cash provided by (used in) financing activities
    
    
    (50,599
    )
    
    
    3,669
    
    
    
    (25,952
    )
    
    
    (72,882
    )Effect of exchange rate changes on cash
    
    
    
    
    
    
    
    
    
    
    108
    
    
    
    108Net decrease in cash
    
    
    (36,683
    )
    
    
    (5,837
    )
    
    
    (3,234
    )
    
    
    (45,754
    )Cash at beginning of period
    
    
    43,693
    
    
    
    6,883
    
    
    
    7,478
    
    
    
    58,054Cash at end of period
    
    $
    7,010
    
    
    $
    1,046
    
    
    $
    4,244
    
    
    $
    12,300
 68




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##### Table of Contents



16. SUBSEQUENT EVENTS
   69




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##### Table of Contents



ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
  
 ITEM 9A. CONTROLS AND PROCEDURES
 Evaluation of Disclosure Controls and Procedures
  Managements Report on Internal Control over Financial Reporting
    Changes in Internal Control over Financial Reporting
  
 ITEM 9B. OTHER INFORMATION
  70




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##### Table of Contents



PART III
 
 ITEM 10 . DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
  Name
    
    Age
    
    Position(s)Thomas N. Chieffe
    
    
    50
    
    
    President and Chief Executive OfficerWarren J. Arthur
    
    
    40
    
    
    Senior Vice President, OperationsCynthia L. Sobe
    
    
    40
    
    
    Vice President-Chief Financial Officer, Treasurer and SecretaryRobert M. Franco
    
    
    54
    
    
    President of Alside Supply CentersWayne D. Fredrick
    
    
    61
    
    
    Executive Vice President of SalesKevin M. Hayes
    
    
    39
    
    
    DirectorIra D. Kleinman
    
    
    51
    
    
    Director, Chairman of the Board of DirectorsKevin C. Nickelberry
    
    
    37
    
    
    DirectorThomas J. Sullivan
    
    
    45
    
    
    DirectorDana R. Snyder
    
    
    61
    
    
    Director and Former Interim President and Chief Executive
OfficerDennis W. Vollmershausen
    
    
    64
    
    
    Director
  Thomas N. Chieffe, Age 50.
 Warren J. Arthur, 40.
 Cynthia L. Sobe, Age 40
 Robert M. Franco, Age 54
 Wayne D. Fredrick, Age 61.
 71




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##### Table of Contents



Kevin M. Hayes, Age 39
 Ira D. Kleinman, Age 51
 Kevin C. Nickelberry, Age 37
 Thomas J. Sullivan, Age 45
 Dana R. Snyder, Age 61.
 Dennis W. Vollmershausen, Age 64
  Name
    
    Position(s)D. Keith LaVanway
    
    Joined the Company in 2001 as Vice President-Chief
Financial Officer of Alside and was also named a Vice
President of the Company. Became Vice President  Chief
Financial Officer, Treasurer and Secretary in 2002. Prior
to joining the Company, Mr. LaVanway was employed by
Nortek, Inc. from 1995 to 2001, where he served in various
financial positions. Mr. LaVanway resigned from the
Company effective September 15, 2007.Trevor Deighton
    
    Mr. Deighton joined the Company in November 2005 as Vice
President and Chief Operating Officer. Prior to joining
the Company, Mr. Deighton was employed by The Black &
Decker Corporation (Black & Decker) since 1988 where he
served in various management positions. Most recently, Mr.
Deighton served as Black & Deckers Vice President of
Global Operations for its Industrial Product Group since
September 2005. Mr. Deighton resigned from the Company
effective March 14, 2007.
 72




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##### Table of Contents



AUDIT COMMITTEE
  SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
  CODE OF ETHICS
 http://www.associatedmaterials.com
 73




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##### Table of Contents



ITEM 11. EXECUTIVE COMPENSATION
 COMPENSATION DISCUSSION AND ANALYSIS
 Objectives of the Companys Executive Compensation Program
   Elements of Compensation
   Setting Executive Compensation
  74




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##### Table of Contents



Base Salary
  Bonus Awards
  Annual Incentive Bonus
   75




---



##### Table of Contents



Equity-Based Compensation  Stock Options
  Other Long-Term Incentives
   76




---



##### Table of Contents



Separation Compensation
  COMPENSATION COMMITTEE REPORT
   
 77




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##### Table of Contents



SUMMARY COMPENSATION TABLE
  Change inPensionValue andNon-Equity
    
    
    NonqualifiedIncentive Plan
    
    
    DeferredName and
    
    
    
    
    
    
    
    
    
    Bonus
    
    
    Stock
    
    
    Option
    
    
    Compensation
    
    
    Compensation
    
    
    All OtherPrincipal Position
    
    Year
    
    
    Salary
    
    
    (1)
    
    
    Awards
    
    
    Awards
    
    
    (2)
    
    
    Earnings
    
    
    Compensation
    
    
    TotalThomas N. Chieffe,
    
    
    2007
    
    
    $
    500,000
    
    
    $
    250,000
    (3)
    
    $
    
    
    
    $
    
    
    
    $
    237,220
    
    
    $
    
    
    
    $
    10,710
    (4)
    
    $
    997,930President and Chief
    
    
    2006
    
    
    
    125,000
    
    
    
    250,000
    (3)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    375,000Executive OfficerWarren J. Arthur,
    
    
    2007
    
    
    
    172,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    127,502
    
    
    
    
    
    
    
    27,581
    (5)
    
    
    327,083Senior Vice President,
OperationsTrevor Deighton,
    
    
    2007
    
    
    
    89,489
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    28,449
    
    
    
    
    
    
    
    692,903
    (6)
    
    
    810,841Vice President,
    
    
    2006
    
    
    
    400,000
    
    
    
    100,000
    (7)
    
    
    
    
    
    
    
    
    
    
    140,000
    
    
    
    
    
    
    
    98,400
    
    
    
    738,400Chief Operating Officer(11)Cynthia L. Sobe,
    
    
    2007
    
    
    
    168,750
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    58,641
    
    
    
    
    
    
    
    6,008
    (4)
    
    
    233,399Vice President 
Chief Financial Officer,
Treasurer and SecretaryD. Keith LaVanway,
    
    
    2007
    
    
    
    250,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12,373
    (8)
    
    
    262,373Vice President 
    
    
    2006
    
    
    
    340,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    204,000
    
    
    
    
    
    
    
    11,668
    
    
    
    555,668Chief Financial Officer,
Treasurer and Secretary(12)Robert M. Franco,
    
    
    2007
    
    
    
    311,250
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    201,352
    
    
    
    
    
    
    
    20,508
    (8)
    
    
    533,110President, Supply
    
    
    2006
    
    
    
    300,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    180,000
    
    
    
    
    
    
    
    18,337
    
    
    
    498,337CentersWayne D. Fredrick,
    
    
    2007
    
    
    
    300,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    191,764
    
    
    
    14,809
    (10)
    
    
    18,905
    (8)
    
    
    525,478Executive Vice President of Sales
    
    
    2006
    
    
    
    292,500
    
    
    
    
    
    
    
    
    
    
    
    26,875
    (9)
    
    
    180,000
    
    
    
    9,965
    (10)
    
    
    15,529
    
    
    
    524,869
 
 (1)
    
    Amounts characterized as Bonus payments were discretionary awards authorized by the
Committee.(2)
    
    Amounts included in the column Non-Equity Incentive Plan Compensation reflect the annual
cash incentive bonus approved by the Committee.(3)
    
    As set forth in his employment agreement, Mr. Chieffe was entitled to a bonus award of 50% of
his base salary for 2007 and $250,000 for 2006, to be paid at the same time as the payments of
the annual incentive bonus to all executives. This bonus award, which was not based on the
achievement of any performance objectives, was included in Mr. Chieffes total compensation
package to provide sufficient incentive for Mr. Chieffe to join the Company.(4)
    
    Includes amounts accrued or allocated under a qualified defined contribution plan available
to all Company employees, and imputed income from group term life coverage provided by the
Company in excess of $50,000.(5)
    
    Includes $27,189 of relocation assistance in conjunction with Mr. Arthur joining the Company
in December 2006 and imputed income from group term life coverage provided by the Company in
excess of $50,000.(6)
    
    Includes $683,333 of cash severance payments pursuant to the Separation Agreement and General
Release dated March 14, 2007, amounts accrued or allocated under a qualified defined
contribution plan available to all Company employees, and imputed income from group term life
coverage provided by the Company in excess of $50,000.(7)
    
    Mr. Deighton was guaranteed a minimum payout of $100,000 for the 2006 annual incentive bonus
under his employment agreement. 78




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##### Table of Contents



(8)
    
    Includes amounts accrued or allocated under a qualified defined contribution plan available
to all Company employees, imputed income from group term life coverage provided by the Company
in excess of $50,000 and the value of customer incentive trips attended by the executives
spouse including the related tax liability.(9)
    
    The amount reflected above is the compensation cost recognized during the year ended December
30, 2006 in accordance with SFAS 123 (Revised) with respect to the 25,117 stock options
awarded to Mr. Fredrick. The fair value at the date of grant of these awards was determined
using the Black-Scholes option pricing model with the following assumptions: dividend yield of
0.0%, a weighted-average risk free interest rate of 4.71%, an expected life of the option of 8
years, and expected volatility of 43.3%.(10)
    
    The amount reflected above is the change in the actuarial present value of Mr. Fredricks
accumulated benefit under the Alside Retirement Plan during the years ended December 29, 2007
and December 30, 2006. Refer to the Pension Benefits section for further discussion
regarding the calculation of benefits earned under the Alside Retirement Plan.(11)
    
    Effective March 14, 2007, Mr. Deighton resigned as the Companys Chief Operating Officer.(12)
    
    Effective September 15, 2007, Mr. LaVanway resigned as the Companys Chief Financial Officer. 79




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##### Table of Contents



GRANTS OF PLAN-BASED AWARDS
  All Other
    
    
    
    
    
    GrantAll Other
    
    Option
    
    
    
    
    
    DateEstimated Future
    
    Estimated Future
    
    Stock
    
    Awards:
    
    
    
    
    
    FairPayouts Under
    
    Payouts Under
    
    Awards:
    
    Number
    
    Exercise
    
    Value ofNon-Equity
    
    Equity Incentive
    
    Number
    
    of
    
    or Base
    
    StockIncentive Plan
    
    Plan Awards
    
    of Shares
    
    Securities
    
    Price of
    
    andAwards
    
    Thresh
    
    
    
    
    
    Maxi
    
    of Stock
    
    Underlying
    
    Option
    
    OptionThreshold
    
    Target
    
    Maximum
    
    -old
    
    Target
    
    -mum
    
    or Units
    
    Options
    
    Awards
    
    AwardsName
    
    ($)
    
    ($)
    
    ($)
    
    (#)
    
    (#)
    
    (#)
    
    (#)
    
    (#)
    
    ($/Sh)
    
    ($)Thomas N. Chieffe
    
    
    
    
    
    
    500,000
    
    
    
    750,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Warren J. Arthur
    
    
    35,000
    
    
    
    105,500
    
    
    
    176,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Trevor Deighton
    
    
    80,000
    
    
    
    240,000
    
    
    
    400,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Cynthia L. Sobe
    
    
    10,000
    
    
    
    50,000
    
    
    
    60,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    D. Keith LaVanway
    
    
    72,000
    
    
    
    216,000
    
    
    
    360,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Robert M. Franco
    
    
    63,000
    
    
    
    189,000
    
    
    
    315,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Wayne D. Frederick
    
    
    60,000
    
    
    
    180,000
    
    
    
    300,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
  2007 Annual Incentive Bonus PayoutPercentageThreshold
    
    Target
    
    MaximumThomas N. Chieffe
    
    
    
    (a)
    
    
    100
    %
    
    
    150
    %Warren J. Arthur
    
    
    20
    %
    
    
    60
    %
    
    
    100
    %Trevor Deighton
    
    
    20
    %(b)
    
    
    60
    %(b)
    
    
    100
    %(b)Cynthia L. Sobe
    
    
    6
    %(c)
    
    
    30
    %(c)
    
    
    35
    %(c)D. Keith LaVanway
    
    
    20
    %
    
    
    60
    %
    
    
    100
    %Robert M. Franco
    
    
    20
    %
    
    
    60
    %
    
    
    100
    %Wayne D. Fredrick
    
    
    20
    %
    
    
    60
    %
    
    
    100
    %
 
 (a)
    
    Based upon his employment agreement, Mr. Chieffe was guaranteed a minimum payout of 50% of
his base salary, or $250,000, for 2007.(b)
    
    Under the terms of his Separation Agreement and General Release, Mr. Deighton was eligible to
receive a pro rata share of his incentive bonus for 2007.(c)
    
    Ms. Sobes annual incentive bonus amounts were established prior to her appointment as Chief
Financial Officer in February 2008. 80




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##### Table of Contents



Salary and Bonus as a% of Total CompensationThomas N. Chieffe
    
    
    75
    %Warren J. Arthur
    
    
    53
    %Trevor Deighton
    
    
    11
    %Cynthia L. Sobe
    
    
    72
    %D. Keith LaVanway
    
    
    95
    %Robert M. Franco
    
    
    58
    %Wayne D. Fredrick
    
    
    57
    %
  EMPLOYMENT AGREEMENTS
  Mr. Chieffe
  81




---



##### Table of Contents



Mr. Deighton
  Mr. LaVanway
  Mr. Franco
  Mr. Frederick
  82




---



##### Table of Contents



New Employment Agreements
    83




---



##### Table of Contents



OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
 Option Awards
    
    Stock AwardsEquityIncentive
    
    EquityPlan
    
    IncentiveAwards:
    
    Plan Awards:Equity
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Number
    
    MarketIncentive
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    of Unearned
    
    or PayoutNumber
    
    
    
    
    
    Plan Awards:
    
    
    
    
    
    
    
    
    
    
    
    
    
    Market
    
    Shares,
    
    Value ofof
    
    Number of
    
    Number
    
    
    
    
    
    
    
    
    
    Number of
    
    Value of
    
    Units or
    
    UnearnedSecurities
    
    Securities
    
    of Securities
    
    
    
    
    
    
    
    
    
    Shares or
    
    Shares or
    
    Other
    
    Shares,Underlying
    
    Underlying
    
    Underlying
    
    
    
    
    
    
    
    
    
    Units of
    
    Units of
    
    Rights That
    
    Units orUnexercised
    
    Unexercised
    
    Unexercised
    
    Option
    
    
    
    
    
    Stock That
    
    Stock That
    
    Have
    
    OtherOptions
    
    Options
    
    Unearned
    
    Exercise
    
    Option
    
    Have Not
    
    Have Not
    
    Not
    
    Rights That(#)
    
    (#)
    
    Options
    
    Price
    
    Expiration
    
    Vested
    
    Vested
    
    Vested
    
    Have NotName
    
    Exercisable
    
    Unexercisable
    
    (#)
    
    ($)
    
    Date
    
    (#)
    
    ($)
    
    (#)
    
    Vested ($)Thomas N. Chieffe
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Warren J. Arthur
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Trevor Deighton
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Cynthia L. Sobe
    
    
    5,314
    (1)
    
    
    
    
    
    
    
    
    
    
    5.00
    
    
    
    9/4/2012
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    D. Keith LaVanway
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Robert M. Franco
    
    
    21,256
    (1)
    
    
    
    
    
    
    
    
    
    
    5.00
    
    
    
    9/4/2012
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    58,723
    (2)
    
    
    70.95
    
    
    
    12/22/2014
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Wayne D. Fredrick
    
    
    10,627
    (1)
    
    
    
    
    
    
    
    
    
    
    5.00
    
    
    
    9/4/2012
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25,117
    (2)
    
    
    5.00
    
    
    
    4/1/2016
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
 
 (1)
    
    Options included in this stock option grant are from the Associated Materials Holdings Inc.
2002 Stock Option Plan, which vest between 10%  20% immediately upon grant and the remainder
on a straight line basis over five years.(2)
    
    Options included in this stock option grant are from the AMH Holdings II, Inc. 2004 Stock
Option Plan, which vest 100% on the eighth anniversary from the date of grant, provided that
the options may become exercisable sooner upon the occurrence of a liquidity event such that
one-half of the total number of options shall become exercisable if the internal rate of
return received by Investcorp on their investment in the Company is at least equal to 10% with
the remainder determined by linear interpolation based on the difference between an internal
rate of return of 10% and 20%. If such internal rate of return to Investcorp is 20% or more,
the option may be exercised for the full number of shares of stock.  Associated Materials Holdings Inc. 2002 Stock Option Plan
  84




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##### Table of Contents



AMH Holdings II, Inc. 2004 Stock Option Plan
  OPTIONS EXERCISES AND STOCK VESTED
  85




---



##### Table of Contents



PENSION BENEFITS
 PresentNumber of Years
    
    Value of
    
    Payments DuringCredited Service
    
    Accumulated Benefit
    
    Last Fiscal YearName
    
    Plan Name
    
    (#)
    
    ($)
    
    ($)Thomas N. Chieffe
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Warren J. Arthur
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Trevor Deighton
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Cynthia L. Sobe
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    D. Keith LaVanway
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Robert M. Franco
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Wayne D. Fredrick
    
    Alside RetirementPlan
    
    
    26.0
    (1)
    
    
    369,954
    
    
    
    
 
 (1)
    
    As the Alside Retirement Plan was frozen on December 31, 1998, employees do not earn
additional years of credited service after that time in determining the amount of benefits
payable under the Plan. Mr. Fredrick has earned 34 years of service that is considered in
determining his vesting service for early retirement eligibility, which is consistent with all
other participants in the Alside Retirement Plan.  NONQUALIFIED DEFERRED COMPENSATION
  POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE-IN-CONTROL
 Separation and Severance Benefits.
 Individual Agreements.
  86




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##### Table of Contents



Severance Benefits
    
    Change in Control Severance BenefitsStock and stock
    
    Severance
    
    Long-term
    
    
    
    
    
    
    
    
    
    Stock and stockSeverance
    
    Benefits
    
    options
    
    payable
    
    incentive
    
    Severance
    
    Benefits
    
    optionsName
    
    payments
    
    (1)
    
    (2)
    
    through
    
    payments (3)
    
    payments
    
    (4)
    
    (2)Thomas N. Chieffe
    
    $
    375,000
    
    
    $
    
    
    
    $
    
    
    
    
    
    
    
    $
    1,500,000
    
    
    $
    375,000
    
    
    $
    
    
    
    $
    Warren J. Arthur
    
    
    11,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,000
    
    
    
    
    
    
    
    Trevor Deighton (5)
    
    
    366,660
    
    
    
    
    
    
    
    
    
    
    
    11/27/2008
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Cynthia L. Sobe
    
    
    28,300
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    28,300
    
    
    
    
    
    
    
    D. Keith LaVanway
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Robert M. Franco
    
    
    409,070
    
    
    
    8,490
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,032,700
    
    
    
    64,680
    
    
    
    Wayne D. Fredrick
    
    
    300,000
    
    
    
    6,540
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    983,525
    
    
    
    43,080
    
    
    
    
 
 (1)
    
    Represents an estimate of the medical benefits, based on the Companys current cost per
employee, to which the executives would be entitled in the event of a termination.(2)
    
    Based on the Companys estimated equity value at December 29, 2007, there was no assumed
value of the outstanding Class B common stock of AMH II and stock options held by executives.(3)
    
    Based on the Companys estimated equity value at December 29, 2007, no payments were due
under the long-term incentive awards to Mr. Chieffe as the thresholds for such payments were
not achieved, other than the amounts guaranteed to Mr. Chieffe under the terms of his
employment agreement.(4)
    
    Represents an estimate of the medical benefits, based on the Companys current cost per
employee, to which the executives would be entitled in the event of a termination in addition
to amounts due for car allowances and employee outplacement services.(5)
    
    Mr. Deighton resigned as the Companys Chief Operating Officer effective March 14, 2007.
Under the terms of his Separation Agreement and General Release, Mr. Deighton will receive
$683,333 payable in semi-monthly installments through November 27, 2008 plus a pro rata
portion of any annual incentive bonus otherwise payable for 2007. As of December 29, 2007, Mr.
Deightons outstanding unpaid severance balance was $366,660. DIRECTOR COMPENSATION
 Changein PensionValue andNon-Equity
    
    NonqualifiedFees Earned
    
    
    
    
    
    
    
    
    
    Incentive
    
    Deferredor Paid
    
    Stock
    
    Option
    
    Plan
    
    Compensation
    
    All OtherName
    
    in Cash
    
    Awards
    
    Awards (1)
    
    Compensation
    
    Earnings
    
    Compensation
    
    TotalKevin M. Hayes
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Ira D. Kleinman
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Thomas Sullivan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Dennis W. Vollmershausen
    
    
    25,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25,000Kevin C. Nickelberry
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Thomas N. Chieffe
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Dana R. Snyder
    
    
    25,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25,000
 
 (1)
    
    At December 29, 2007, the aggregate number of options awards outstanding to directors was:
Mr. Vollmershausen  2,870 shares and Mr. Snyder  14,093 shares.  87




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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS
       88




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##### Table of Contents




    
    each person known by the Company to own beneficially 5% or more of the outstanding voting
preferred stock or voting common stock of AMH II;
    
    the directors and named executive officers of the Company; and
    
    all directors and named executive officers of the Company as a group.
  Class A Preferred Stock
    
    Class B Common StockNumber of
    
    
    
    
    
    Number ofShares  Series
    
    % of
    
    Shares  Series
    
    % ofI (voting)
    
    Class
    
    I (voting)
    
    ClassInvestcorp S.A.(1)
    
    
    500,000
    
    
    
    100
    %
    
    
    
    
    
    
    Sipco Limited(2)
    
    
    500,000
    
    
    
    100
    %
    
    
    
    
    
    
    AM Equity Limited(3)
    
    
    80,117
    
    
    
    16.0
    %
    
    
    
    
    
    
    AM Investments Limited(4)
    
    
    80,117
    
    
    
    16.0
    %
    
    
    
    
    
    
    Associated Equity Limited(5)
    
    
    80,117
    
    
    
    16.0
    %
    
    
    
    
    
    
    Associated Investments Limited(6)
    
    
    80,117
    
    
    
    16.0
    %
    
    
    
    
    
    
    Investcorp 2005 AMH Holdings II Portfolio
Limited Partnership(7)
    
    
    109,533
    
    
    
    21.9
    %
    
    
    
    
    
    
    Investcorp Coinvestment Partners II, L.P.(8)
    
    
    36,666
    
    
    
    7.3
    %
    
    
    
    
    
    
    Investcorp Coinvestment Partners I, L.P.(9)
    
    
    33,333
    
    
    
    6.7
    %
    
    
    
    
    
    
    Harvest Funds(10)(11)(12)
    
    
    
    
    
    
    
    
    
    
    500,000
    
    
    
    100
    %
 Class B Common Stock
    
    Class B Common StockNumber of
    
    
    
    
    
    Number ofShares  Series
    
    % of
    
    Shares  Series
    
    % ofI (voting)
    
    Class
    
    II (non-voting)
    
    ClassExecutive Officers and DirectorsThomas N. Chieffe
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Warren J. Arthur
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Trevor Deighton
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Cynthia L. Sobe (13)
    
    
    
    
    
    
    
    
    
    
    5,314
    
    
    
    *D. Keith LaVanway
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Robert M. Franco (14)
    
    
    
    
    
    
    
    
    
    
    21,256
    
    
    
    1.7
    %Wayne D. Fredrick (15)
    
    
    
    
    
    
    
    
    
    
    10,627
    
    
    
    *Kevin M. Hayes (16)
    
    
    
    
    
    
    
    
    
    
    228,719
    
    
    
    18.6
    %Ira D. Kleinman (17)
    
    
    500,000
    
    
    
    100
    %
    
    
    
    
    
    
    Kevin C. Nickelberry
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Thomas Sullivan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Dana R. Snyder
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Dennis W Vollmershausen (18)
    
    
    
    
    
    
    
    
    
    
    4,189
    
    
    
    *All directors and executive officers as a
group
    
    
    500,000
    
    
    
    100
    %
    
    
    270,105
    
    
    
    21.4
    %
 
 *
    
    less than 1%(1)
    
    Investcorp S.A. does not directly own any shares of stock of AMH II. With respect to the
shares of Series I Class A Preferred Stock held by Investcorp 2005 AMH Holdings II Portfolio
Limited Partnership (109,533 shares), Investcorp Coinvestment Partners II, L.P. (36,666
shares) and Investcorp Coinvestment Partners I, L.P. (33,333 shares), Investcorp S.A. is the
general partner of each of those partnerships and, therefore, Investcorp S.A. may be deemed to
share beneficial ownership of those shares. The balance of the shares of Series I Class A
Preferred Stock is owned by AM Equity Limited, AM Investments Limited, Associated 89




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Equity
Limited and Associated Investments Limited (collectively, the AMH Investors). Investcorp
S.A. does not own any of the shares of the AMH Investors. Investcorp S.A. may be deemed to
share beneficial ownership of the shares of Series I Class A Preferred Stock held by the AMH
Investors because the owners of the voting stock of the AMH Investors have entered into
revocable management services or similar agreements with an affiliate of Investcorp S.A.
pursuant to which each of the entities owning the voting stock of the AMH Investors, or such
entities stockholders, has granted such affiliate the authority
to direct the voting and disposition of the voting shares issued by such entity, which permits
Investcorp S.A. to control the voting and disposition of the Series I Class A Preferred Stock
owned by each AMH Investor for so long as such agreements are in effect. The address for
Investcorp Bank S.A. is 6 rue Adolphe Fischer, Luxembourg.(2)
    
    Sipco Limited may be deemed to control Investcorp S.A. through its ownership of a majority of
a companys stock that indirectly owns a majority of Investcorp S.A.s shares. Sipco Limited
is a Cayman Islands company with its address at P.O. Box 1111, West Wind Building, George
Town, Grand Cayman, Cayman Islands.(3)
    
    AM Equity Limited is a Cayman Islands company with its address at P.O. Box 2197, West Wind
Building, George Town, Grand Cayman, Cayman Islands.(4)
    
    AM Investments Limited is a Cayman Islands company with its address at P.O. Box 2197, West
Wind Building, George Town, Grand Cayman, Cayman Islands.(5)
    
    Associated Equity Limited is a Cayman Islands company with its address at P.O. Box 2197, West
Wind Building, George Town, Grand Cayman, Cayman Islands.(6)
    
    Associated Investments Limited is a Cayman Islands company with its address at P.O. Box 2197,
West Wind Building, George Town, Grand Cayman, Cayman Islands.(7)
    
    Investcorp 2005 AMH Holdings II Portfolio Limited Partnership is a Cayman Islands exempted
limited partnership with its address at P.O. Box 1111, West Wind Building, George Town, Grand
Cayman, Cayman Islands.(8)
    
    Investcorp Coinvestment Partners II, L.P. is a Delaware limited partnership with its address
at 280 Park Avenue, New York, New York 10017.(9)
    
    Investcorp Coinvestment Partners I, L.P. is a Delaware limited partnership with its address
at 280 Park Avenue, New York, New York 10017.(10)
    
    Harvest Funds are Harvest Partners III, L.P., Harvest Partners III Beteilingungsgesellschaft
Burgerlichen Rechts (mit Haftungsbeschrankung) (Harvest Partners III, GbR), Harvest Partners
IV, L.P. and Harvest Partners IV GmbH & Co. KG (Harvest Partners IV KG). Harvest Associates
III, L.L.C., which has five voting members, is the general partner of Harvest Partners III,
L.P. and Harvest Partners III, GbR. Harvest Associates IV, L.L.C., which has five voting
members, is the general partner of Harvest Partners IV, L.P. and Harvest Partners IV KG.
Harvest Partners, Inc. provides management services for Harvest Associates III, L.L.C. in
connection with Harvest Partners III, L.P. and Harvest Partners III, GbR and for Harvest
Associates IV, L.L.C. in connection with Harvest Partners IV, L.P. and Harvest Partners IV KG.(11)
    
    Includes 131,978 shares of Class B Series I (voting) common stock owned by Harvest Partners
III, L.P. and 18,022 shares of Class B Series I (voting) common stock owned by Harvest
Partners III, GbR for each of which Harvest Associates III, L.L.C. is the general partner.
Harvest Associates III, L.L.C. has five voting members, each of whom has equal voting rights
and who may be deemed to share beneficial ownership of the shares of common stock of AMH. The
five members are Ira Kleinman, Harvey Mallement, Stephen Eisenstein, Harvey Wertheim, and
Thomas Arenz. Mr. Kleinman is on the board of directors of AMH II. Each of Messrs. Kleinman,
Mallement, Eisenstein, Wertheim and Arenz disclaims beneficial ownership of the shares of
Class A common stock owned by Harvest Partners III, L.P. and Harvest Partners III GbR.(12)
    
    Includes 286,465 shares of Class B Series I (voting) common stock owned by Harvest Partners
IV, L.P. and 63,535 shares of Class B Series I (voting) common stock owned by Harvest Partners
IV KG, for each of which Harvest Associates IV, L.L.C. is the general partner. Harvest
Associates IV, L.L.C. has five voting members, each of whom has equal voting rights and who
may be deemed to share beneficial ownership of the shares of Class B common stock of AMH
beneficially owned by it. The five members are Ira Kleinman, Harvey Mallement, Stephen
Eisenstein, Harvey Wertheim and Thomas Arenz. Mr. Kleinman is on the board of directors of AMH
II. Each of Messrs. Kleinman, Mallement, Eisenstein, Wertheim and Arenz disclaims beneficial
ownership of the shares of Class A common stock owned by Harvest Partners IV, L.P., Harvest
Partners IV KG. Harvest Partners III, L.P., Harvest Partners III GbR, Harvest
Partners IV, L.P. and Harvest 90




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##### Table of Contents



Partners IV KG are collectively referred to as the Harvest Funds. The
address of the named entities is 280 Park Avenue, 33rd Floor, New York, New York 10017.(13)
    
    Includes options to purchase 5,314 shares of Class B Series II (non-voting) common stock.(14)
    
    Includes options to purchase 21,256 shares of Class B Series II (non-voting) common stock.(15)
    
    Includes options to purchase 10,627 shares of Class B Series II (non-voting) common stock.(16)
    
    Mr. Hayes is a director for AMH II representing four of AMH IIs stockholders, Weston
Presidio Capital III, L.P., Weston Presidio Capital IV, L.P., WPC Entrepreneur Fund, L.P. and
WPC Entrepreneur Fund II, L.P., which are collectively referred to as the Weston Funds. Mr.
Hayes election as a director is prescribed by the stockholders agreement. See Item 13.
Certain Relationships and Related Transactions  The Stockholders Agreement. The shares
included in the table above includes shares held by the Weston Funds as follows: Weston
Presidio Capital III, L.P. holds 65,992 shares of Class B Series II (non-voting) common stock;
Weston Presidio Capital IV holds 156,986 shares of Class B Series II (non-voting) common
stock; WPC Entrepreneur Fund, L.P. holds 3,256 shares of Class B Series II (non-voting) common
stock; and WPC Entrepreneur Fund II, L.P. holds 2,485 shares of Class B Series II (non-voting)
common stock. Mr. Hayes is a member or partner, as the case may be,
of the general partner of the Weston Funds. Mr. Hayes disclaims beneficial ownership of the
shares held by the Weston Funds, except to the extent of his pecuniary interest therein.(17)
    
    Includes shares of Class B Series I (voting) common stock owned by Harvest Partners III, L.P.
and shares of Class B Series I (voting) common stock owned by Harvest Partners III GbR, for
each of which Harvest Associates III, L.L.C. is the general partner. Also includes shares of
Class B Series I (voting) common stock owned by Harvest Partners IV, L.P. and Harvest Partners
IV KG, for each of which Harvest Partners IV, L.L.C. is the general partner. Mr. Kleinman is a
voting member of Harvest Associates, III, L.L.C. and Harvest Partners IV, L.L.C. and may be
deemed to share beneficial ownership of the shares of common stock of AMH beneficially owned
by them. Mr. Kleinman disclaims beneficial ownership of common shares owned by Harvest
Partners III, L.P., Harvest Partners III GbR, Harvest Partners IV, L.P. and Harvest Partners
IV KG.(18)
    
    Includes 1,319 shares of Class B Series II (non-voting) common stock owned through a personal
holding company in the name of 3755428 Canada Inc., a Canadian corporation. Mr. Vollmershausen
is the sole shareholder of this corporation. Mr. Vollmershausen also holds options to purchase
2,870 shares of Class B Series II (non-voting) common stock. CHANGES IN CONTROL
 PLEDGE AND SECURITY AGREEMENT
  STOCKHOLDERS AGREEMENT
  91




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ITEM 13. CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
 THE RESTRUCTURING AGREEMENTS
    THE STOCKHOLDERS AGREEMENT
     92




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93




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RELATED PARTY TRANSACTIONS
  MANAGEMENT AGREEMENT
  DIRECTOR INDEPENDENCE
     94




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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
  2007
    
    
    2006Audit Fees
    
    $
    940
    
    
    $
    815Audit-Related Fees
    
    
    524
    
    
    
    Tax Fees
    
    
    731
    
    
    
    148All Other Fees
    
    
    
    
    
    
    Total Fees
    
    $
    2,195
    
    
    $
    963
  AUDIT FEES
  AUDIT RELATED FEES
  TAX FEES
  95




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##### Table of Contents



PART IV
 
 ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
  (A)(1) FINANCIAL STATEMENTS
  (A)(2) FINANCIAL STATEMENT SCHEDULES
  (C) EXHIBITS
  96




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##### Table of Contents



SIGNATURES
  ASSOCIATED MATERIALS LLCBy:
    /s/ THOMAS N. CHIEFFEThomas N. ChieffePresident and Chief Executive
Officer
(Principal Executive Officer)By:
    /s/ CYNTHIA L. SOBECynthia L. SobeVice President-Chief Financial
Officer,
Treasurer and Secretary
(Principal Financial Officer and Principal
Accounting Officer)   Signature
    
    Title
    
    Date/s/ THOMAS N. CHIEFFE
    
    President and Chief Executive Officer
    
    March 25, 2008Thomas N. Chieffe
    
    (Principal Executive Officer)/s/ CYNTHIA L. SOBE
    
    Vice President-Chief Financial
    
    March 25, 2008Cynthia L. Sobe
    
    Officer, Treasurer and Secretary(Principal Financial Officer andPrincipal Accounting Officer)Kevin M. Hayes *
    
    DirectorIra D. Kleinman *
    
    DirectorThomas Sullivan *
    
    DirectorDana R. Snyder *
    
    DirectorKevin C. Nickelberry *
    
    DirectorDennis W. Vollmershausen *
    
    Director* By: /s/ CYNTHIA L. SOBECynthia L. SobeAttorney-in-Fact
    
    
    
    March 25, 2008
   97




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##### Table of Contents



EXHIBIT INDEX
 ExhibitNumber
    
    Description2.1
    
    Agreement and Plan of Merger, dated as of March 16, 2002, by and among
Associated Materials Holdings Inc. (formerly known as Harvest/AMI Holdings
Inc.), Simon Acquisition Corp. and the Company (incorporated by reference to
Exhibit 99(d)(1) of Schedule TO filed by Associated Materials Holdings, Inc.
and certain affiliates, Commission File No. 005-53705, filed on March 22,
2002).3.1
    
    Certificate of Formation of Associated Materials, LLC.3.2
    
    Limited Liability Company Agreement of Associated Materials, LLC.3.3
    
    Certificate of Incorporation of Alside, Inc. (incorporated by reference to
Exhibit 3.3 to the Companys Registration Statement on Form S-4/A, Commission
File No. 333-92010, filed on September 12, 2002).3.4
    
    Amended and Restated Bylaws of Alside, Inc. (incorporated by reference to
Exhibit 3.4 to the Companys Registration Statement on Form S-4/A, Commission
File No. 333-92010, filed on September 12, 2002).4.1
    
    Indenture governing the Companys 9 3/4% Senior Subordinated Notes Due 2012,
dated as of April 23, 2002, by and among the Company, AMI Management Company
and Wilmington Trust Company(incorporated by reference to Exhibit 4.2 to the
Companys Registration Statement on Form S-4, Commission File No. 333-92010,
filed on July 3, 2002).4.2
    
    Supplemental Indenture governing the Companys 9 3/4% Senior Subordinated
Notes Due 2012, dated as of May 10, 2002 by and among the Company, AMI
Management Company, Al side, Inc. and Wilmington Trust Company (incorporated
by reference to Exhibit 4.3 to the Companys Registration Statement on Form
S-4, Commission File No. 333-92010, filed on July 3, 2002).4.3
    
    Second Supplemental Indenture, dated as of August 29, 2003, among the
Company, Alside, Inc., Gentek Holdings, Inc., Gentek Building Products, Inc.
and Wilmington Trust Company (incorporated by reference to Exhibit 4.3 to the
Companys Annual Report on Form 10-K, filed on April 2, 2004).4.4
    
    Form of the Companys 9 3/4% Senior Subordinated Note Due 2012 (incorporated
by reference to Exhibit 4.4 to the Companys Registration Statement on Form
S-4, Commission File No. 333-92010, filed on July 3, 2002).10.1
    
    Second Amended and Restated Credit Agreement (the Credit Agreement), dated
December 22, 2004, among Associated Materials Incorporated and Gentek
Building Products Limited, as borrowers, AMH Holdings, Inc. and Associated
Materials Holdings, Inc., as guarantors, the lenders party thereto, UBS AG,
Stamford Branch, as the U.S. Administrative Agent, Canadian Imperial Bank of
Commerce, as the Canadian Administrative Agent, Citigroup Global Markets
Inc., as syndication agent, General Electric Capital Corporation and National
City Bank, as Co-Documentation Agents, and UBS Securities, LLC and Citigroup
Global Markets Inc., as joint lead arrangers (incorporated by reference to
Exhibit 10.3 to the Current Report on Form 8-K/A, filed with the Securities
and Exchange Commission on December 23, 2004).10.2
    
    Borrower Security and Pledge Agreement of the Company, dated as of April 19,
2002, by the Company, in favor of UBS AG, Stamford Branch, as administrative
agent (incorporated by reference to Exhibit 10.2 to the Companys
Registration Statement on Form S-4, Commission File No. 333-92010, filed on
July 3, 2002).10.3
    
    Form of Subsidiary Security and Pledge Agreement, by each subsidiary of the
Company from time to time party thereto in favor of UBS AG, Stamford Branch,
as administrative agent, on behalf of the Secured Parties (as defined in the
Credit Agreement) (incorporated by reference to Exhibit 10.3 to the Companys
Registration Statement on Form S-4, Commission File No. 333-92010, filed on
July 3, 2002).
 98




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##### Table of Contents



ExhibitNumber
    
    Description10.4
    
    Form of Subsidiary Guaranty, by each subsidiary of the Company from time to
time party thereto in favor of UBS AG, Stamford Branch, as administrative
agent, on behalf of the Secured Parties (as defined in the Credit Agreement)
(incorporated by reference to Exhibit 10.4 to the Companys Registration
Statement on Form S-4, Commission File No. 333-92010, filed on July 3, 2002).10.5
    
    Assumption Agreement, dated as of April 19, 2002, by and among the Company
and AMI Management Company, as guarantors (incorporated by reference to
Exhibit 10.5 to the Companys Registration Statement on Form S-4, Commission
File No. 333-92010, filed on July 3, 2002).10.6
    
    Agreement of Sale, dated as of January 30, 1984, between USX Corporation
(formerly United States Steel Corporation) (USX) and the Company
(incorporated by reference to Exhibit 10.1 to the Companys Registration
Statement on Form S-1, Commission File No. 33-64788).10.7
    
    Amendment Agreement, dated as of February 29, 1984, between USX and the
Company (incorporated by reference to Exhibit 10.2 to the Companys
Registration Statement on Form S-1, File No. 33-64788).10.8
    
    Form of Indemnification Agreement between the Company and each of the
directors and executive officers of the Company (incorporated by reference to
Exhibit 10.14 to the Companys Registration Statement on Form S-1, File No.
33-84110).10.9
    
    Amended and Restated Management Agreement, dated December 22, 2004, by and
between Harvest Partners, Inc. and Associated Materials Incorporated
(incorporated by reference to Exhibit 10.7 to the Current Report on Form
8-K/A, filed with the Securities and Exchange Commission on December 23,
2004).10.10
    
    Asset Purchase Agreement, dated as of June 24, 2002, between the Company and
Amer Cable Incorporated (incorporated by reference to Exhibit 10.12 to the
Companys Registration Statement on Form S-4, Commission File No. 333-92010,
filed on July 3, 2002).10.11*
    
    Associated Materials Holdings Inc. 2002 Stock Option Plan (incorporated by
reference to Exhibit 10.13 to the Companys Registration Statement on Form
S-4, Commission File No. 333-92010, filed on July 3, 2002).10.12*
    
    Amended and Restated Employment Agreement, dated as of July 27, 2004, between
the Company and Michael Caporale, Jr. (incorporated by reference to Exhibit
10.13 to the Companys Annual Report on Form 10-K, filed with the Securities
and Exchange Commission on April 1, 2005)10.13*
    
    Amended and Restated Employment Agreement, dated as of March 31, 2006,
between the Company and D. Keith LaVanway. (incorporated by reference to
Exhibit 10.2 to the Companys Quarterly Report on Form 10-Q, filed with the
Securities and Exchange Commission on May 16, 2006)10.14*
    
    Associated Materials Holding Inc. Stock Option Award Agreement, dated
September 4, 2002, between Associated Materials Holdings Inc. and Michael
Caporale, Jr. (incorporated by reference to Exhibit 10.17 to the Companys
Registration Statement on Form S-4/A, Commission File No. 333-92010, filed on
October 10, 2002).10.15*
    
    Associated Materials Holding Inc. Stock Option Award Agreement, dated
September 4, 2002, between Associated Materials Holdings Inc. and Michael
Caporale, Jr. (incorporated by reference to Exhibit 10.18 to the Companys
Registration Statement on Form S-4/A, Commission File No. 333-92010, filed on
September 12, 2002).10.16*
    
    Amended and Restated Employment Agreement, dated as of July 27, 2004, between
the Company and Kenneth L. Bloom. (incorporated by reference to Exhibit 10.17
to the Companys Annual Report on Form 10-K, filed with the Securities and
Exchange Commission on April 1, 2005)10.17*
    
    Amended and Restated Employment Agreement, dated as of March 30, 2006,
between the Company and Robert M. Franco. (incorporated by reference to
Exhibit 10.3 to the Companys Quarterly Report on Form 10-Q, filed with the
Securities and Exchange Commission on May 16, 2006)
 99




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##### Table of Contents



ExhibitNumber
    
    Description10.18*
    
    Amended and Restated Employment Agreement, dated as of March 31, 2006,
between the Company and John F. Haumesser. (incorporated by reference to
Exhibit 10.4 to the Companys Quarterly Report on Form 10-Q, filed with the
Securities and Exchange Commission on May 16, 2006)10.19
    
    Stock Purchase Agreement (the Stock Purchase Agreement), dated July 31,
2003, by and among the Company, Gentek Holdings, Inc., Gentek Building
Products, Inc., Gentek Building Products Limited, The Sherwin-Williams Claims
Trust, Genstar Capital Corporation, Ontario Teachers Pension Plan Board and
other stockholders listed therein (incorporated by reference to Exhibit 2.1
to the Companys current report on Form 8-K filed on July 31, 2003).10.20
    
    Amendment No. 1 to the Stock Purchase Agreement, dated as of August 29, 2003,
by and among the Company, Gentek Holdings, Inc., Gentek Building Products,
Inc., Gentek Building Products Limited, The Sherwin-Williams Claims Trust,
Genstar Capital Corporation, Ontario Teachers Pension Plan Board and other
stockholders listed therein (incorporated by reference to Exhibit 2.2 to the
Companys current report on Form 8-K filed on September 12, 2003).10.21
    
    Amendment Agreement, dated December 22, 2004, by and between Associated
Materials Incorporated, Gentek Building Products Limited, as borrowers, AMH
Holdings, Inc. and Associated Materials Holdings, Inc., the lenders party
thereto, UBS AG, Stamford Branch, as the U.S. Administrative Agent, Canadian
Imperial Bank of Commerce, as the Canadian Administrative Agent, Citigroup
Global Markets Inc., as syndication agent, and UBS Securities, LLC and
Citigroup Global Markets Inc., as joint lead arrangers (incorporated by
reference to Exhibit 10.4 to the Current Report on Form 8-K/A, filed with the
Securities and Exchange Commission on December 23, 2004).10.22
    
    Management Advisory Agreement, dated December 22, 2004, by and between
Investcorp International, Inc. and Associated Materials Incorporated
(incorporated by reference to Exhibit 10.8 to the Current Report on Form
8-K/A, filed with the Securities and Exchange Commission on December 23,
2004).10.23
    
    Financing Advisory Agreement, dated December 22, 2004, by and between
Investcorp International, Inc. and Associated Materials Incorporated
(incorporated by reference to Exhibit 10.9 to the Current Report on Form
8-K/A, filed with the Securities and Exchange Commission on December 23,
2004).10.24
    
    M&A Advisory Services Agreement, dated December 5, 2004, by and between
Investcorp International, Inc. and Associated Materials Incorporated
(incorporated by reference to Exhibit 10.10 to the Current Report on Form
8-K/A, filed with the Securities and Exchange Commission on December 23,
2004)10.25*
    
    AMH Holdings II, Inc. 2004 Stock Option Plan (incorporated by reference to
Exhibit 10.11 to the Current Report on Form 8-K/A, filed with the Securities
and Exchange Commission on December 23, 2004)10.26
    
    Superholdco Pledge and Security Agreement, dated December 22, 2004, by and
between AMH, as Pledgor in favor of UBS AG, Stamford Branch, as the
Administrative Agent (incorporated by reference to Exhibit 10.5 of the
Companys Current Report on Form 8-K/A, filed with the Securities and
Exchange Commission on December 23, 2004).10.27
    
    Form of Superholdco Guaranty, dated December 22, 2004, by and between AMH, as
Guarantor, in favor of UBS AG, Stamford Branch, as the Administrative Agent
(incorporated by reference to Exhibit 10.6 of the Companys Current Report on
Form 8-K/A, filed with the Securities and Exchange Commission on December 23,
2004).10.28
    
    Stock Purchase Agreement, dated December 5, 2004, by and between AMH and the
other parties signatory hereto (incorporated by reference to Exhibit 2.1 to
the Companys Current Report on Form 8-K, filed with the Securities and
Exchange Commission on December 7, 2004).10.29
    
    Stockholders Agreement, dated December 22, 2004, by and between the
stockholders of AMH (incorporated by reference to Exhibit 10.2 to the
Companys Current Report on Form 8-K/A, filed with the Securities and
Exchange Commission on December 23, 2004).
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##### Table of Contents



ExhibitNumber
    
    Description10.30
    
    Tax Sharing Agreement, dated March 4, 2004, by and among AMH, Holdings and
AMI. (incorporated by reference to Exhibit 10.30 to the Companys Annual
Report on Form 10-K, filed with the Securities and Exchange Commission on
April 1, 2005).10.31*
    
    Employment Agreement, dated as of November 28, 2005, between the Company and
Trevor Deighton (incorporated by reference to exhibit 10.1 to the Current
Report on Form 8-K/A filed with the Securities and Exchange Commission on
December 16, 2005).10.32*
    
    Separation Agreement and General Release Between the Company and Kenneth L.
Bloom, dated as of December 28, 2005 (incorporated by reference to Exhibit
10.32 to the Companys Annual Report on Form 10-K, filed with the Securities
and Exchange Commission on March 24, 2006).10.33*
    
    Repurchase Agreement Between Kenneth L. Bloom and AMH Holdings II, Inc.,
dated as of January 2, 2006 (incorporated by reference to Exhibit 10.33 to
the Companys Annual Report on Form 10-K, filed with the Securities and
Exchange Commission on March 24, 2006).10.34
    
    Amendment No. 1, dated as of February 1, 2006, to the Second Amended and
Restated Credit Agreement, dated as of December 22, 2004, by and among the
Company and Gentek Building Products Limited, as borrowers, AMH Holdings,
Inc. and Associated Materials Holdings, Inc., the lenders party thereto, UBS
AG, Stamford Branch, as the U.S. Administrative Agent, Canadian Imperial Bank
of Commerce, as the Canadian Administrative Agent, Citigroup Global Markets
Inc., as syndication agent, and UBS Securities, LLC and Citigroup Global
Markets Inc., as joint lead arrangers (incorporated by reference to exhibit
10.1 to the Current Report on Form 8-K, filed with the Securities and
Exchange Commission on February 6, 2006).10.35*
    
    Instrument of Amendment to Employment Agreement, dated as of March 31, 2006,
between the Company and Trevor Deighton (incorporated by reference to Exhibit
10.5 to the Companys Quarterly Report on Form 10-Q, filed with the
Securities and Exchange Commission on May 16, 2006).10.36*
    
    Employment Agreement, dated as of April 3, 2006, between the Company and
Wayne Fredrick (incorporated by reference to exhibit 10.1 to the Current
Report on Form 8-K filed with the Securities and Exchange Commission on April
5, 2006).10.37*
    
    Separation Agreement and General Release Between the Company and Michael
Caporale, Jr., dated as of April 11, 2006 (incorporated by reference to
exhibit 10.1 to the Current Report on Form 8-K filed with the Securities and
Exchange Commission on April 14, 2006).10.38*
    
    Independent Consultant Agreement, dated as of April 3, 2006, between the
Company and Dana R. Snyder (incorporated by reference to exhibit 10.1 to the
Current Report on Form 8-K filed with the Securities and Exchange Commission
on April 4, 2006).10.39*
    
    Employment Agreement, dated as of July 1, 2006, between the Company and Dana
R. Snyder (incorporated by reference to exhibit 10.1 to the Current Report on
Form 8-K filed with the Securities and Exchange Commission on July 5, 2006).10.40*
    
    Agreement and General Release, dated as of October 1, 2006, between the
Company and Dana R. Snyder (incorporated by reference to exhibit 10.1 to the
Current Report on Form 8-K filed with the Securities and Exchange Commission
on October 2, 2006).10.41*
    
    Independent Consultant Agreement, dated as of October 2, 2006, between the
Company and Dana R. Snyder (incorporated by reference to exhibit 10.2 to the
Current Report on Form 8-K filed with the Securities and Exchange Commission
on October 2, 2006).10.42*
    
    Employment Agreement, dated as of August 21, 2006, between the Company and
Thomas N. Chieffe (incorporated by reference to exhibit 10.1 to the Current
Report on Form 8-K filed with the Securities and Exchange Commission on
August 23, 2006).
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##### Table of Contents



ExhibitNumber
    
    Description10.43*
    
    Separation Agreement and General Release, dated as of March 14, 2007, between
the Company and Trevor Deighton (incorporated by reference to exhibit 10.1 to
the Current Report on Form 8-K filed with the Securities and Exchange
Commission on March 30, 2007).10.44*
    
    Agreement and General Release, dated as of November 29, 2007, between the
Company and Dana R. Snyder (incorporated by reference to exhibit 10.1 to the
Current Report on Form 8-K filed with the Securities and Exchange Commission
on December 4, 2007).21.1
    
    Subsidiaries of the Registrant24.1
    
    Power of Attorney31.1
    
    Certification of the Principal Executive Officer pursuant to Rule 13a-14(a)
or 15d-14(a) of the Exchange Act, as adopted, pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.31.2
    
    Certification of the Principal Financial Officer pursuant to Rule 13a-14 or
15d-14(a) of the Exchange Act, as adopted, pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.32.1
    
    Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section
1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section
1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002.
 
 *
    
    Management contract or compensatory plan or arrangement.
 102