Armstrong Proposes Bonuses to Retain Mid-Level Managers Amid Bankruptcy
Lancaster, PA, June 2, 2022-Armstrong Flooring, which filed for Chapter 11 bankruptcy on May 8, estimated the bonuses to as many as 50 “key personnel” would be an average of $14,900 per person, reports Lancaster Online.
“The employees covered include those in product manufacturing and design, shipping and transportation, product management, marketing, finance, sales, human resources and customer service
“The bonuses would range from 8% to 12% of the annual base level salary of key people that executives and their consultants determined were important to assist in the sale and wind down of the company. These are not executives who already received bonuses.
“The East Lampeter-based company said the financial incentive was needed because employees could be looking to leave. Armstrong Flooring is a global producer of resilient flooring products used primarily in the construction and renovation of commercial, residential, and institutional buildings.
“About 38% of the key workers would be retained until the closing of the sale of the North American assets and 62% would stay through to the closing of the sale of Chinese and Australian assets, Armstrong said.
“A smaller subset of the group may be needed, Armstrong Flooring said, in case a liquidator is selected as a top bidder. In that scenario, they would be needed to wind down operations.
“According to court filings, in addition to the $1.4 million a few days before the bankruptcy filing, senior executives also received $3.4 million in retention bonuses in February 2022. The company was already struggling with its debt load at the start of the year, sparking concern about top execs departing.
“Under the $1.4 million bonus plan for executives that was disclosed last month, [CEO Michel] Vermette received $432,250; chief financial officer Amy Trojanowski, $193,375; chief compliance officer Christopher Parisi, $155,084; senior vice president Brent Flaharty, $151,558, and senior vice president, human resources, John Bassett, $129,390. 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 Sept. 3.”
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