Item 2.01 Completion of Acquisition or Disposition of Assets.
As previously disclosed, on May 8, 2022, Armstrong Flooring, Inc., a Delaware
corporation (the "Company"), and its wholly owned subsidiaries Armstrong
Flooring Latin America, Inc., a Delaware corporation ("AFI Latin America"),
Armstrong Flooring Canada Ltd., a British Columbia corporation ("AFI Canada"),
and AFI Licensing LLC, a Delaware limited liability company ("AFI Licensing"
and, together with the Company, AFI Latin America and AFI Canada, the
"Debtors"), 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 (the "Bankruptcy Court"). The chapter 11 cases are being administered
under the caption In re Armstrong Flooring, Inc., et
al. (Case No. 22-10426) (the "Chapter 11 Cases").
As previously disclosed, following evaluation of all qualified bids and other
proposals received for the assets of the Company, the Company entered into:
(a) a binding Asset Purchase Agreement (the "North America Purchase Agreement"),
dates as of July 10, 2022, by and among the Debtors and a consortium of buyers
consisting of AHF, LLC, a Delaware limited liability company ("AHF"), and Gordon
Brothers Commercial & Industrial, LLC, a Delaware limited liability company
(together with AHF, the "North America Consortium Buyers") for the sale of
substantially all of the Company's North American assets for a purchase price of
$107 million in cash (subject to certain adjustments) and assumption of certain
specified liabilities, including certain cure claims and certain equipment
leases; (b) a binding Asset Purchase Agreement (the "Australia Purchase
Agreement"), dated as of July 11, 2022, by and among the Company and Armstrong
Flooring Pty Ltd, an Australian company limited by shares ("AFI Australia", and
collectively with the Company, the "Australia Sellers"), and Braeside Mills
Investments Pty Ltd, Gippsland Lakes Victoria Holdings Pty Ltd, and HS
McKendrick Family Nominees Pty Ltd as trustee of the Mills Unit Trust
(collectively, the "Cowes Bay Buyers"), for the sale of substantially all of AFI
Australia's assets for a purchase price of $31 million in cash and the
assumption of certain specified liabilities; and (c) a Stock Purchase Agreement
(the "Asia Purchase Agreement", and collectively with the North America Purchase
Agreement and the Asia Purchase Agreement, the "Purchase Agreements"), dated as
of July 11, 2022, by and between the Company and Zhejiang GIMIG Technology Co.,
Ltd., a company established under the laws of the People's Republic of China
("Giant Buyer"), pursuant to which Giant Buyer will purchase the equity
interests of Armstrong Flooring Hong Kong Limited, a private company limited by
shares incorporated in Hong Kong and wholly owned subsidiary of the Company, for
a purchase price of $59 million in cash. The Purchase Agreements were approved
by the Bankruptcy Court on July 13, 2022.
On July 25, 2022, the Company consummated the transactions contemplated by the
North America Purchase Agreement and closed on the sale of substantially all of
its North America assets to the North America Consortium Buyers (the "Closing").
The Company continues to cooperate with the Bankruptcy Court and work alongside
its secured creditors to continue operating its business in Asia and Australia
while it finalizes all details and closes the remaining sale transactions.
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Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On July 22, 2022, in connection with the Chapter 11 Cases and the Closing, Brent
A. Flaharty departed from his position as Senior Vice President and Chief
Customer Experience Officer of the Company.
On July 22, 2022, in connection with the Chapter 11 Cases and the Closing, Amy
P. Trojanowski, CPA departed from her position as Senior Vice President and
Chief Financial Officer of the Company.
On July 22, 2022, in connection with the Chapter 11 Cases and the Closing, John
Bassett departed from his position as Senior Vice President and Chief Human
Resources Officer of the Company.
On July 22, 2022, in connection with the Chapter 11 Cases and the Closing,
Phillip Gaudreau departed from his position as Vice President and Controller of
the Company.
On July 22, 2022, in connection with the Chapter 11 Cases and the Closing, David
E. Thoresen departed from his position as Vice President of Business Development
of the Company.
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Cautionary Information Regarding Trading in the Company's Securities.
As described in greater detail in Item 2.01 above, the Company has sold
substantially all of its North American assets and it has agreed to sell
substantially all of its assets outside of North America pursuant to the Asia
Purchase Agreement and the Australia Purchase Agreement. Following consummation
of these sales, the Company is expected to be wound down. Holders of the
Company's equity securities will likely be entitled to no recovery on their
investment following the Chapter 11 Cases, and recoveries to other stakeholders
cannot be determined at this time. The Company cautions that trading in the
Company's securities is highly speculative and poses substantial risks. Trading
prices for the Company's securities may bear little or no relationship to the
actual value to be realized, if any, by holders of the Company's securities in
the Chapter 11 Cases. Accordingly, the Company urges extreme caution with
respect to existing and future investments in its securities.
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Item 9.01 Financial Statements and Exhibits
(d) Exhibits
Exhibit No. Description
104 Cover Page Interactive Data File (formatted as inline XBRL)
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ARMSTRONG FLOORING, INC. 
