Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of
On May 3, 2022, the Company entered into retention agreements
with certain key employees, including the Company’s named executive
officers, pursuant to the approval of the Board of Directors (the
“Board”) of Armstrong Flooring, Inc. (the “Company”).
Pursuant to the respective retention agreements, retention payments
equal to $432,250 for Mr. Vermette, $193,375, for
Ms. Trojanowski, $155,084 for Mr. Parisi, $151,558 for
Mr. Flaharty and $129,390 for Mr. Bassett, were paid on
or around May 6, 2022. The retention amounts must be repaid by
the named executive officer in accordance with the retention
agreement if the executive resigns from employment for any reason
or is terminated by the Company for cause prior to the vesting date
of September 30, 2022. Prior to the vesting date, the
repayment obligation will lapse upon the earliest to occur of
(i) the termination of the executive’s employment by the
Company without cause or due to the executive’s death or
(ii) such earlier date as determined in the discretion of the
Chief Executive Officer of the Company (or, in the case of the
retention letter with Mr. Vermette, the Chairman of the
Management Development and Compensation Committee).
The foregoing summary of the retention agreements does not purport
to be complete and is subject to, and qualified in its entirety by
reference to, the form agreement to be filed by the Company with
its Quarterly Report on Form 10-Q for the quarter ending
June 30, 2022.
Cautionary Information Regarding
Trading in the Company’s Securities.
As previously announced, on May 8, 2022, the Company together
with certain of its subsidiaries filed voluntary petitions for
relief under chapter 11 of title 11 of the United States Code in
the United States Bankruptcy Court for the District of Delaware
(collectively, the “Chapter 11 Filings”). The Company
continues to face certain risks and uncertainties that have been
affecting its business and operations, and these risks and
uncertainties may affect the Company’s ability to enter into a sale
transaction and could impact the outcome of the Chapter 11 Filings.
Holders of the Company’s equity securities will likely be entitled
to little or no recovery on their investment following the Chapter
11 Filings, and recoveries to other stakeholders cannot be
determined at this time. The Company cautions that trading in the
Company’s securities given the pendency of the Chapter 11 Filings
is highly speculative and poses substantial risks. Trading prices
for the Company’s securities may bear little or no relationship to
the actual value realized, if any, by holders of the Company’s
securities in the Chapter 11 Filings. Accordingly, the Company
urges extreme caution with respect to existing and future
investments in its securities.