Volume 11, Issue 2 - March 2010


Companies Educate Their Dealers Regarding Lead Paint Regulations
While a few months ago not many in the door and window industry knew about the upcoming regulations involving lead paint, which affects window replacement contractors, many in the industry are taking the necessary steps to educate those who will be affected by these major changes coming on April 22, 2010.

Gorell Windows and Doors hosted a webinar in early February to educate dealers regarding these new lead paint laws. Kachina Contractor Solutions, a company that trains companies regarding the new regulations offered an overview of what will change come April. According to Kachina’s Paul Toub, it means huge changes for window contractors.

“Our life as we know it will change so much that I’ve had people compare this to the ‘Do Not Call Law’,” says Toub.
Toub started the webinar by reminding attendees of what changes are in store including the fact that firms must be certified, renovators must be trained and lead-safe work practices must be followed.

To become a certified renovator an individual must successfully complete an eight-hour initial renovator training course offered by an accredited training provider.
Toub suggests that companies get several people in their companies trained.

“What happens when that person gets sick, or goes on vacation?” he says.

Currently homeowners can “opt out” of these lead safe work practices if they do not have a child under six living in the home or a pregnant woman. However, the contractor must give everyone living in a pre-1978 home a copy of the EPA booklet regarding lead paint. Toub tells people if they are unsure of the age of a home, “When it doubt hand it out.”

However, contractors should be aware that it is possible that the opt-out clause could be removed. “The Sierra Club and other environmental groups are putting pressure on the EPA to eliminate the opt-out,” says Toub. “They’re saying people aren’t smart enough to make their own decisions.”

As far as the training required, Toub tells contractors they need to get started “today” as “this will change the way you do business.”

He also tells dealers that the added measures that must be taken will cost money and he suggests not lumping it in with the price of window replacements.

“Put it as a separate item,” says Toub. “Tell homeowners, ‘If you test positive for lead, I’ll have to charge x amount.” He says this will help honest companies compete against those who don’t follow these rules and undercut honest dealers.

“I’ve heard companies charging $25 per window. People are coming up with their own different formulas. I can’t tell you what to charge.”

Toub also reminded participants of the exorbitant costs that will be charged to dealers who don’t comply with these news rules–$37,500 per violation, per day.

So what happens to the companies who take the time to get certified and take the extra measures, all of which cost money?

“I’ve heard a lot of people say they’re going to start ratting out other contractors who don’t comply,” he says.

Valuable Industry Research Now Available
For the latest data regarding the door and window industry, DWM readers can obtain a free download, including slides and audio, of the recently recorded Fall/Winter 2009 Window & Door Industry Update webinar provided by Jordan, Knauff and Co.

The topics covered in the presentation included an overview of the door and window industry, including an analysis of transactions and expansions and the slowing rate of plant closings and bankruptcies. Also included was a discussion of current industry trends, the state of the residential and commercial real estate markets and a review of the capital markets and private equity investing as they pertain to the door and window industry. In addition, the presentation covered current trends regarding competition from Chinese companies, including the most recent import statistics and some of the events taking place in China that will affect the U.S. domestic market.

Glasslam Files FTC Complaint Against Edgetech and Two Industry Groups
Glasslam chief executive officer Steve Howes says he sent a letter to the Federal Trade Commission (FTC) dated February 11, 2010, alleging “anti-competitive and illegal practices by several companies, trade organizations and individuals,” including Edgetech IG, the Insulating Glass Certification Council (IGCC) and the Insulating Glass Manufacturers Alliance (IGMA).

In the letter, Howes states that Glasslam (also known as Nebula Glass International) was founded in 1983 to serve the needs of the glass and window industries by supplying resin products for the production of laminated and decorative door glass. It goes on to say that in 2007, Glasslam entered the warm-edge foam spacer market. As Glasslam began production on its new spacer plant in 2007, the company says “Edgetech was already taking steps to hinder Glasslam’s entry in the market.”

The filing also claims that IGMA and IGCC “ignore their own rules to aid Edgetech in the market.”

The letter continues, “The evidence is clear that Edgetech IG has been fraudulently using leadership positions in IGCC/IGMA/IGMAC to both violate honest certification of insulating glass units and deter competition by blocking rulings of equivalency of Glasslam’s products in the market.”

Edgetech released a statement shortly after saying it is prepared to defend itself against Glasslam International’s false accusations.

“Glasslam International recently sent Edgetech I.G. a copy of a letter addressed to the Federal Trade Commission in which it alleges that Edgetech, the IGCC, and IGMA collectively undertook several actions aimed at inhibiting Glasslam’s spacer product from entering the marketplace. Glasslam’s assertions are meritless. Edgetech is proud of its reputation for integrity and quality and will vigorously defend itself against these false accusations and will take any and all appropriate legal action,” read the Edgetech statement.

IGMA executive director Margaret Webb says IGMA will not address specific allegations contained in Glasslam’s letter of complaint at the present time but will address this matter further when it is appropriate to do so. “We do not agree with the complaint,” she says.

“IGMA operates under and is in compliance with our Anti-Trust Guidelines, Conflict of Interest and Intellectual Property polices as established and documented by the organization,” she adds. “IGMA uses an open process that seeks extensive technical input from all facets of the IG industry (member and non-member companies alike) for the development of certification program requirements and voluntary guidelines and recommendations for IG unit manufacturing.”

She adds, “We realize that not everyone may agree with the results of our work, but our programs are based on ongoing analysis of technologies, research designed to improve current practices and broad technical input.”

Webb points out that IGMA’s membership is comprised of certified insulating glass manufacturers, their suppliers and associates plus window manufacturers, representatives from the architectural community, energy efficiency lobbies, code officials and other parties interested in the design and long-term performance of insulating glass units.

“We work closely with other associations, standards’ bodies and governments to establish and support the standards under which IG units are certified,” she adds. “IGMA is the world’s leading organization on the engineering and manufacturing of insulating glass, and we are dedicated to developing and advancing new technologies in the manufacture of insulating glass units.”

The IGCC’s John Kent says he has also received a letter from Glasslam (Nebula Glass International Inc.) stating that Glasslam has submitted a complaint letter to the FTC complaining about IGCC as well as IGMA, IGMAC, Edgetech IG Inc., and several specific persons.

“We at IGCC, an I.R.C. Sec. 501(c)(3) not-for-profit product testing and industry standards-related organization (not a trade association), do not agree with Glasslam’s complaint letter; we welcome disclosure of all the relevant facts; and we will continue to offer the same high level of service to the IG industry in promotion of the entire IG industry and in the public interest as we have offered for over 30 years,” says Kent. “IGCC has always operated, and will continue to do so, in accordance with IGCC’s open and balanced parliamentary due process procedure, where 50 percent of the voting power of the organization is vested with Industry Representatives and 50 percent with independent Public Interest Representatives, and in accordance with IGCC’s well-documented corporate antitrust compliance policy. At the appropriate time, we will discuss this matter further.”

In a separate letter, also dated February 11, 2010, Howes says, “We are also filing a complaint with the Anti-Trust Division of the United States Justice Department, seeking an investigation into multiple violations including, “monopolizing trade a felony” and “theft or bribery concerning programs receiving federal funds.”

Stiles to Represent Makor and Venjakob
Stiles Machinery Inc. has announced that it now represents Makor SRL and Venjakob Maschinenbau GmbH for all non-wood related applications. Stiles says it now offers parts, service and production engineering to their customers who work with plastics, composites, glass or any other non-wood application.

Stiles will continue servicing their traditional woodworking clients for the duration of the year per its agreement with Cefla. In December 2010, Stiles will terminate its distribution agreement with Cefla Finishing America and sell the Makor and Venjakob product exclusively.

Atlanta Hardwood Corp. Acquires Craig Lumber Corp.
Atlanta Hardwood Corp. has acquired Craig Lumber Corp. in Collierville, Tenn. The new entity will be known as AHC Craig Imports.

Craig Lumber imports more than 30 species of exotic lumber, specializing in West African and South American hardwoods. The company ships to distributors throughout the United States and Canada.

Charles Craig will remain with the company as vice president of AHC Craig Imports.

Atrium Companies File for Voluntary Chapter 11
Dallas-based Atrium Companies Inc., which owns Atrium Windows and Doors, filed for Chapter 11 in January in the U.S. Bankruptcy Court for the District of Delaware. Likewise, its Canadian subsidiary initiated reorganization proceedings under the Companies’ Creditors Arrangement Act (CCAA) in the Ontario Superior Court of Justice in Toronto.

Though Atrium and its subsidiaries have filed for bankruptcy, company officials announced that the filing is part of an agreement they reached with more than two-thirds of their senior secured lenders to reduce its outstanding debt by more than $350 million, or more than 50 percent of its existing debt, through a “pre-negotiated” restructuring of its balance sheet.

The following Atrium subsidiaries and divisions are included in the Chapter 11 filing:

Atrium Corp.; ACIH Inc.; Aluminum Screen Manufacturers; Atrium Door and Window Co. – West Coast; Atrium Door and Window Co. of Arizona; Atrium Door and Window Co. of the Northeast; Atrium Door and Window Co. of the Northwest; Atrium Door and Window Co. of the Rockies; Atrium Enterprises; Atrium Extrusion Systems Inc.; Atrium Florida Inc.; Atrium Vinyl Inc.; Atrium Windows and Doors of Ontario Inc.; Champion Window Inc.; North Star Manufacturing (London) Ltd.; R.G. Darby Co. Inc.; Superior Engineered Products Corp.; Thermal Industries Inc.; and Total Trim Inc.

The company lists between 5,001 and 10,000 creditors; estimated assets between $100,000,001 and $5 million; and estimated liabilities between $500,000,001 and $1 billion in its official Chapter 11 filing.

A number of the company’s creditors holding the 50 largest unsecure claims are suppliers within the glass and glazing industry. Some of those listed include:

Cardinal Glass ($814,810); Mikron ($492,612); Amesbury Group ($237,119); PPG ($235,347); Royal Window and Door Profiles ($224,675); Truth Hardware ($139,441); and H.B. Fuller ($82,723).

According to the company statement, Atrium intends to move forward with the restructuring on an expeditious basis and complete the restructuring process in approximately three to four months.

“The balance sheet restructuring will substantially reduce our outstanding debt and put Atrium in a much stronger financial position to grow our business over the long term,” says Gregory T. Faherty, president and chief executive officer of Atrium.
“We have already done the hard work of lowering our cost structure and reducing excess capacity in light of the difficult environment under which we have been operating for more than three years. And, we are already experiencing the positive impact of these initiatives through increased profitability.”

Atrium’s legal advisors are Kirkland & Ellis in the United States and Goodmans LLP in Canada. Moelis & Company is serving as financial advisor.




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