SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date
of
Report (Date of Earliest Event
Reported): May
18, 2006
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INTERFACE,
INC.
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(Exact
name of Registrant as Specified in its
Charter)
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Georgia
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000-12016
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58-1451243
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(State
or other Jurisdiction of
incorporation
or Organization)
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(Commission
File
Number)
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(IRS
Employer
Identification
No.)
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2859
Paces Ferry Road, Suite 2000
Atlanta,
Georgia
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30339
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(Address
of principal executive offices)
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(Zip
code)
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Registrant’s
telephone number, including area code: (770) 437-6800
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Not
Applicable
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(Former
name or former address, if changed since last
report
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Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
¨ Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
¨ Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
¨ Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
¨ Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
ITEM
1.01 ENTRY
INTO A MATERIAL DEFINITIVE AGREEMENT.
On
May
18, 2006, the Company’s shareholders approved an amendment and restatement of
the Interface, Inc. Omnibus Stock Incentive Plan. (The amended and restated
plan
was adopted by the Company’s Board of Directors on February 22, 2006, subject to
shareholder approval.) A description of the Interface, Inc. Omnibus Stock
Incentive Plan, as amended and restated (the “Stock Incentive Plan” or the
“Plan”), is provided below, and a copy of the Plan is attached hereto as
Exhibits 99.1.
General
The
Stock
Incentive Plan provides for the grant to key employees and directors of the
Company and its subsidiaries of restricted stock, incentive stock options
(which
qualify for certain favorable tax treatment), nonqualified stock options,
stock
appreciation rights, deferred shares, performance shares and performance
units.
The aggregate number of shares of Common Stock (which may be either Class
A or
Class B Common Stock) that may be issued or transferred under the Stock
Incentive Plan on or after the effective date of February 22, 2006, is
4,250,000, provided, however, that each share issued pursuant to an award
other
than a stock option will reduce the number of remaining shares available
by two
shares. No more than 3,187,500 shares of Common Stock may be issued under
the
Plan upon the exercise of incentive stock options (as described below). The
Plan
expires on February 21, 2016.
Eligibility
and Limitations; Plan Benefits
The
Stock
Incentive Plan is administered by the Compensation Committee of the Board
of
Directors. All employees of the Company or one of its subsidiaries, outside
directors and consultants or independent contractors performing bona fide
services for the Company or one of its subsidiaries, are eligible for
consideration as participants under the Plan, although only employees are
eligible to receive grants of incentive stock options. The Compensation
Committee has authority to determine the participants to whom awards will
be
granted, the form and amount of the awards (including whether the grant is
for
Class A or Class B Common Stock), the dates of grant, vesting period, option
prices (in the case of awards of options), performance objectives (in the
case
of restricted shares, deferred shares, performance shares or performance
units)
and other terms of each award.
Description
of Awards
Restricted
Shares. Awards
of restricted stock under the Stock Incentive Plan may be made either without
consideration from the participant or, in the Compensation Committee’s
discretion, in consideration of a payment by the participant that is less
than
the fair market value of the award on the date of grant. When
so
determined by the Compensation Committee, awards of restricted stock
may also specify “performance
objectives”
(as described
below). Awards
of
restricted stock generally will not be transferable by the participant other
than by will or applicable laws of descent and distribution, although the
Compensation Committee, in its discretion, may permit limited transfers of
awards to family members or for estate planning purposes.
Stock
Options. Options
granted under the Stock Incentive Plan may be incentive stock options (as
defined in Section 422 of the Internal Revenue Code of 1986, as amended),
nonqualified stock options or a combination of the foregoing, although only
employees are eligible to receive incentive stock options. All options under
the
Plan will be granted at an exercise price per share equal to not less than
100%
of the fair market value of the Class A Common Stock on the date the option
is
granted. Options granted under the Plan will not be exercisable later than
10
years after the date of grant.
The
Company receives no consideration upon the granting of an option. Full payment
of the option exercise price must be made when an option is exercised. The
exercise price may be paid in cash or in such other form as the Company may
approve, including shares of Common Stock valued at their fair market value
on
the date of option exercise. The proceeds received by the Company from the
exercise of options under the Stock Incentive Plan are used for general
corporate purposes. Options generally will not be transferable by the holder
thereof other than by will or applicable laws of descent and distribution,
although the Compensation Committee, in its discretion, may permit limited
transfers of options to family members or for estate planning
purposes.
Stock
Appreciation Rights. Stock
appreciation rights (“SARs”) under the Stock Incentive Plan may be granted
either in tandem with nonqualified stock options or as freestanding SARs.
Tandem
SARs may be exercised only in connection with the exercise of the related
option. SARs may be exercised no later than ten years after the date of grant.
Each grant of a freestanding SAR will specify a base price per share, which
shall be equal to or greater than the fair market value of a share of Class
A
Common Stock on the grant date.
Upon
exercise of an SAR, the Company will pay the participant a specified percentage
(not to exceed 100%) of the amount by which the fair market value of a share
of
Class A Common Stock on the date of exercise exceeds the base price per share
(in the case of freestanding SARs) or the exercise price of the related option
(in the case of tandem SARs). The amount payable upon exercise of the SAR
may be
paid in cash, shares of Common Stock or any combination thereof, in the
Compensation Committee’s discretion. SARs generally will not be transferable by
the holder thereof other than by will or applicable laws of descent and
distribution, although the Compensation Committee, in its discretion, may
permit
limited transfers of SARs to family members or for estate planning
purposes.
Deferred
Shares, Performance Shares and Performance Units. The
Compensation Committee may also authorize grants to participants of deferred
shares, performance shares and performance units. Deferred shares are granted
subject to a deferral period, during which time the participant has no rights
of
ownership in the deferred shares. Performance shares and performance units
become payable to the participant upon the achievement of specified performance
objectives (as described below). A performance share is the equivalent of
a
share of Common Stock, and a performance unit is the equivalent of $1. The
Stock
Incentive Plan provides for the Compensation Committee to establish “performance
objectives” for purposes of performance shares and performance units. When so
determined by the Compensation Committee, awards of deferred stock may also
specify performance objectives.
Performance
objectives may be described in terms of Company-wide objectives or objectives
that are related to the performance of the individual participant or of the
subsidiary, division, department or function within the Company in which
the
participant is employed. Any performance objectives applicable to awards
intended to qualify as “performance-based compensation” under Section 162(m) of
the Internal Revenue Code will be selected from any of the following measures:
operating income; cash flow; reduction of off-quality and waste; return on
equity; earnings per share; total earnings; earnings growth; sales growth;
return on capital; return on assets; earnings before interest and taxes;
gross
margin; economic value added; increases in the fair market value of the
Company’s Common Stock; improvement in fixed charge coverage ratio; debt
reduction and/or cash accumulation; measurable financial criteria associated
with credit facility, bond indenture or other covenants; or any combination
thereof. If the Compensation Committee determines that a change in the business,
operations, corporate structure or capital structure of the Company or other
events or circumstances render the performance objectives unsuitable, the
Compensation Committee may modify such performance objectives or any related
minimum acceptable level of achievement, in whole or in part, as it deems
appropriate and equitable and subject to certain limitations under Section
162(m) of the Internal Revenue Code.
ITEM
9.01 FINANCIAL
STATEMENTS AND EXHIBITS.
(a)
Financial Statements of Businesses Acquired.
None.
(b)
Pro Forma Financial Information.
None.
(c)
Exhibits.
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Exhibit
No.
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Description
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99.1
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Interface,
Inc. Omnibus Stock Incentive Plan, as amended and restated February
22,
2006.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
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INTERFACE,
INC.
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By:
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/s/
Patrick C. Lynch
Patrick
C. Lynch
Vice
President and Chief Financial Officer
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Date:
May 22, 2006
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EXHIBIT
INDEX
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Exhibit
No.
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Description
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99.1
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Interface,
Inc. Omnibus Stock Incentive Plan, as amended and restated February
22,
2006.
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