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Item 9A. Controls and Procedures

2021-03-03 compared with 2020-02-26 · 69 added, 71 removed, 118 unchanged (54% of the section changed)

9 unchanged sentences

Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

Our management assessed the effectiveness of our internal control over financial reporting as of December 29, 2019 based on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in “Internal Control – Integrated Framework (2013).” Based on that assessment, management concluded that, as of December 29, 2019, our internal control over financial reporting was effective based on those criteria.

Our management assessed the effectiveness of our internal control over financial reporting as of January 3, 2021 based on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in “Internal Control – Integrated Framework (2013).” Based on that assessment, management concluded that, as of January 3, 2021, our internal control over financial reporting was effective based on those criteria.

Our independent auditors have issued an audit report on the effectiveness of our internal control over financial reporting.

22 unchanged sentences

and subsidiaries and related Reports of Independent Registered Public Accounting Firm are contained in Item 8 of this Report:

Consolidated Statements of Operations and Comprehensive Income — fiscal years ended December 29, 2019, December 30, 2018 and December 31, 2017.

Consolidated Balance Sheets — December 29, 2019 and December 30, 2018.

Consolidated Statements of Cash Flows — fiscal years ended December 29, 2019, December 30, 2018 and December 31, 2017.

Consolidated Statements of Operations and Comprehensive Income (Loss) — fiscal years ended January 3, 2021, December 29, 2019 and December 30, 2018.

Consolidated Balance Sheets — January 3, 2021 and December 29, 2019.

Consolidated Statements of Cash Flows — fiscal years ended January 3, 2021, December 29, 2019, and December 30, 2018.

Notes to Consolidated Financial Statements

5 unchanged sentences

Schedule II — Valuation and Qualifying Accounts and Reserves

The following exhibits are included as part of this Report:

The following exhibits are filed or furnished with this Report:

Description of Exhibit

Share Purchase and Transfer Agreement dated June 14, 2018 by and among the Company, Interface BV, DealCo Luxembourg II S.à r.l.

and nora Management III Beteiligungs GmbH & Co.

KG (included as Exhibit 2.1 to the Company’s current report on Form 8-K filed on June 14, 2018, previously filed with the Commission and incorporated herein by reference).

3.1 Restated Articles of Incorporation and accompanying Clarification Certificate (included as Exhibit 3.1 to the Company’s quarterly report on Form 10-Q filed on May 10, 2012, previously filed with the Commission and incorporated herein by reference).

3.2 Bylaws, as amended and restated February 22, 2017 (included as Exhibit 3.1 to the Company’s current report on Form 8-K filed on February 27, 2017, previously filed with the Commission and incorporated herein by reference).

Description of the Company’s Securities.

4.1 Description of the Company’s Securities (included as Exhibit 4.1 to the Company’s annual report on Form 10-K for the year ended December 29, 2019, previously filed with the Commission and incorporated herein by reference).

4.2 Indenture governing the Company’s 5.50% Senior Notes Due 2028, dated as of November 17, 2020 (included as Exhibit 4.1 to the Company’s current report on Form 8-K filed on November 18, 2020, previously filed with the Commission and incorporated herein by reference).

4.3 Form of 5.50% Senior Note Due 2028 (included as Exhibit 4.2 to the Company’s current report on Form 8-K filed on November 18, 2020, previously filed with the Commission and incorporated herein by reference, and included in Exhibit 4.2 to this Report).

10.1 Salary Continuation Plan, dated May 7, 1982 (included as Exhibit 10.20 to the Company’s registration statement on Form S-1, File No.

8 unchanged sentences

Form of Performance Share Agreement for executive officers (included as Exhibit 10.2 to the Company’s quarterly report on Form 10-Q filed on May 11, 2017, previously filed with the Commission and incorporated herein by reference) ;

and Form of Restricted Stock Agreement, as used for directors (included as Exhibit 10.2 to the Company’s quarterly report on Form 10-Q filed on May 11, 2017, previously filed with the Commission and incorporated herein by reference).*

Form of Restricted Stock Agreement, as used for directors (included as Exhibit 10.2 to the Company’s quarterly report on Form 10-Q filed on May 11, 2017, previously filed with the Commission and incorporated herein by reference) ;

Form of 2018 Restricted Stock Agreement for executive officers (included as Exhibit 10.1 to the Company’s quarterly report on Form 10-Q filed on May 11, 2018, previously filed with the Commission and incorporated herein by reference) ;

and Form of 2018 Performance Share Agreement for executive officers (included as Exhibit 10.2 to the Company’s quarterly report on Form 10-Q filed on May 11, 2018, previously filed with the Commission and incorporated herein by reference).*

10.4 Interface, Inc.

6 unchanged sentences

and Fourth Amendment thereto, dated as of December 31, 2003 (included as Exhibit 10.7 to the 2003 10-K, previously filed with the Commission and incorporated herein by reference).*

Employment Agreement of Daniel T.

Hendrix dated as of March 3, 2017 (included as Exhibit 99.1 to the Company’s current report on Form 8-K filed on April 6, 2017, previously filed with the Commission and incorporated herein by reference).*

10.6 Amended and Restated Employment and Change in Control Agreement of Jay D.

Gould dated as of March 3, 2017 (included as Exhibit 99.1 to the Company’s current report on Form 8-K filed on April 14, 2017, previously filed with the Commission and incorporated herein by reference).*

Split Dollar Insurance Agreement, dated February 21, 1997, between the Company and Daniel T.

Hendrix (included as Exhibit 10.2 to the Company’s quarterly report on Form 10-Q for the quarter ended October 4, 1998, previously filed with the Commission and incorporated herein by reference);

and Amendment thereto, dated December 29, 2008 (included as Exhibit 99.1 to the Company’s current report on Form 8-K filed on January 2, 2009, previously filed with the Commission and incorporated herein by reference).*

10.7 Form of Indemnity Agreement of Director (as used for directors of the Company) (included as Exhibit 99.1 to the Company’s current report on Form 8-K filed on November 30, 2005, previously filed with the Commission and incorporated herein by reference).*

Form of Indemnity Agreement of Officer (as used for certain officers of the Company, including Daniel T.

Hendrix and Jay D.

Gould) (included as Exhibit 99.2 to the Company’s current report on Form 8-K filed on November 30, 2005, previously filed with the Commission and incorporated herein by reference).*

10.8 Form of Indemnity Agreement of Officer (as used for certain current and former officers of the Company, including Daniel T.

Hendrix , Jay D.

Gould , David B.

Foshee, and Matthew J.

Miller ) (included as Exhibit 99.2 to the Company’s current report on Form 8-K filed on November 30, 2005, previously filed with the Commission and incorporated herein by reference).*

10.9 Interface, Inc.

5 unchanged sentences

Third Amendment thereto, dated April 15, 2010 (included as Exhibit 10.21 to the 2012 10-K, previously filed with the Commission and incorporated herein by reference) ;

and Fourth Amendment thereto, dated August 9, 2012 (included as Exhibit 10.22 to the 2012 10-K, previously filed with the Commission and incorporated herein by reference).*

Amended and Restated Security and Pledge Agreement, dated as of August 8, 2017, among Interface, Inc., certain subsidiaries of the Company as obligors, and Bank of America, N.A.

as Administrative Agent (included as Exhibit 99.2 to the Company’s current report on Form 8-K filed on August 9, 2017, previously filed with the Commission and incorporated herein by reference).

Fourth Amendment thereto, dated August 9, 2012 (included as Exhibit 10.22 to the 2012 10-K, previously filed with the Commission and incorporated herein by reference) ;

Sixth Amendment thereto, dated March 30, 2020 (included as Exhibit 10.1 to the Company ’ s current report on Form 8-K filed on March 31, 2020, previously filed with the Commission and incorporated herein by reference) ;

Seventh Amendment thereto (included as Exhibit 10.1 to the Company ’ s quarterly report on Form 10-Q filed on August 11, 2020, previously filed with the Commission and incorporated herein by reference) ;

and Ei ghth Amendment thereto, dated November 19, 2020 (included as Exhibit 10.1 to the Company ’ s current report on Form 8-K filed on November 24, 2020, previously filed with the Commission and incorporated herein by reference).*

10.11 Second Amended and Restated Security and Pledge Agreement, dated as of August 7, 2018, among Interface, Inc., certain subsidiaries of the Company as obligors, and Bank of America, N.A.

as Administrative Agent.

Severance Protection Arrangement for Bruce A.

Hausmann (included in Item 5.02 of the Company’s current report on Form 8-K filed on March 13, 2017, previously filed with the Commission and incorporated herein by reference.)*

Form of 2018 Performance Share Agreement for executive officers (included as Exhibit 10.2 to the Company’s quarterly report on Form 10-Q filed on May 11, 2018, previously filed with the Commission and incorporated herein by reference).*

as Administrative Agent (included as Exhibit 10.14 to the Company’s annual report on Form 10-K for the year ended December 29, 2019, previously filed with the Commission and incorporated herein by reference).

10.12 Employment Offer Letter to Bruce A.

Hausmann (included as Exhibit 10.3 to the Company’s quarterly report on Form 10-Q filed on May 11, 2018, previously filed with the Commission and incorporated herein by reference).*

Employment Offer Letter to J.

Chadwick Scales (included as Exhibit 10.4 to the Company’s quarterly report on Form 10-Q filed on May 11, 2018, previously filed with the Commission and incorporated herein by reference).*

Severance Protection and Change in Control Agreement of Matthew J.

Miller dated as of April 3, 2018 (included as Exhibit 99.2 to the Company’s current report on Form 8-K filed on April 25, 2018, previously filed with the Commission and incorporated herein by reference).*

10.13 First Restatement Agreement, dated as of July 20, 2018, among Interface, Inc., certain subsidiaries of the Company as borrowers, certain subsidiaries of the Company as guarantors, Bank of America, N.A.

as Administrative Agent, and the other lenders party thereto.

(included as Exhibit 10.1 to the Company’s current report on Form 8-K filed on July 26, 2018, previously filed with the Commission and incorporated herein by reference.)

as Administrative Agent, and the other lenders party thereto (included as Exhibit 10.1 to the Company’s current report on Form 8-K filed on July 26, 2018, previously filed with the Commission and incorporated herein by reference).

10.14 First Amendment to Second Amended and Restated Syndicated Facility Agreement, dated as of December 18, 2019 (included as Exhibit 99.1 to the Company’s current report on Form 8-K filed on December 23, 2019, previously filed with the Commission and incorporated herein by reference).

10.15 Second Amendment to Second Amended and Restated Syndicated Facility Agreement dated as of July 15, 2020 (included as Exhibit 10.1 to the Company’s current report on Form 8-K filed on July 16, 2020, previously filed with the Commission and incorporated herein by reference).

10.16 Third Amendment to Second Amended and Restated Syndicated Facility Agreement, dated as of November 17, 2020 (included as Exhibit 10.1 to the Company’s current report on Form 8-K filed on November 18, 2020, previously filed with the Commission and incorporated herein by reference).

10.17 Interface, Inc.

2020 Omnibus Stock Incentive Plan (included as Exhibit 99.1 to the Company’s current report on Form 8-K filed on May 28, 2020, previously filed with the Commission and incorporated herein by reference).*

10.18 Contract of employment of Nigel Stansfield.*

10.19 Form of Severance Protection and Change in Control Agreement (as used for David B.

Foshee and Matthew J.

21 Subsidiaries of the Company .

1 unchanged sentence

24 Power of Attorney (see signature page of this Report) .

Certification of Chief Executive Officer with respect to the Company’s Annual Report on Form 10-K for the fiscal year ended December 29, 2019.

Certification of Chief Financial Officer with respect to the Company’s Annual Report on Form 10-K for the fiscal year ended December 29, 2019.

Certification Pursuant to Section 1350 of Chapter 63 of Title 18 of United States Code by Chief Executive Officer with respect to the Company’s Annual Report on Form 10-K for the fiscal year ended December 29, 2019.

Certification Pursuant to Section 1350 of Chapter 63 of Title 18 of United States Code by Chief Financial Officer with respect to the Company’s Annual Report on Form 10-K for the fiscal year ended December 29, 2019.

XBRL Instance Document – The Instance Document does not appear in the Interactive Data Files because its XBRL tags are embedded within the Inline XBRL document.

XBRL Taxonomy Extension Schema Document

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XBRL Taxonomy Presentation Linkbase Document

XBRL Taxonomy Definition Linkbase Document

The cover page from this Annual Report on Form 10-K for the year ended December 29, 2019, formatted in Inline XBRL

31.1 Certification of Chief Executive Officer with respect to the Company’s Annual Report on Form 10-K for the fiscal year ended January 3, 2021.

31.2 Certification of Chief Financial Officer with respect to the Company’s Annual Report on Form 10-K for the fiscal year ended January 3, 2021.

32.1 Certification Pursuant to Section 1350 of Chapter 63 of Title 18 of United States Code by Chief Executive Officer with respect to the Company’s Annual Report on Form 10-K for the fiscal year ended January 3, 2021.

32.2 Certification Pursuant to Section 1350 of Chapter 63 of Title 18 of United States Code by Chief Financial Officer with respect to the Company’s Annual Report on Form 10-K for the fiscal year ended January 3, 2021.

101.INS XBRL Instance Document – The Instance Document does not appear in the Interactive Data Files because its XBRL tags are embedded within the Inline XBRL document.

101.SCH XBRL Taxonomy Extension Schema Document.

101.CAL XBRL Taxonomy Extension Calculation Linkbase Document.

101.LAB XBRL Taxonomy Extension Label Linkbase Document.

101.PRE XBRL Taxonomy Presentation Linkbase Document.

101.DEF XBRL Taxonomy Definition Linkbase Document.

104 The cover page from this Annual Report on Form 10-K for the year ended January 3, 2021, formatted in Inline XBRL.

* Management contract or compensatory plan or agreement required to be filed pursuant to Item 15(b) of this Report.

3 unchanged sentences

SCHEDULE II – VALUATION AND QUALIFYING ACCOUNTS AND RESERVES

(DESCRIBE) (B)

OF YEAR COLUMN B

EXPENSES (A) COLUMN C

ACCOUNTS COLUMN D

(DESCRIBE) (B) COLUMN E

(in thousands)

Allowance for Doubtful Accounts:

December 29, 2019

Allowance for Expected Credit Losses

January 3, 2021 $ 3,793 $ 3,777 $ — $ 927 $ 6,643

December 29, 2019 3,540 881 — 628 3,793

2 unchanged sentences

(B) Write off of bad debt, and recovering of previously provided for amounts.

(DESCRIBE) (C)

OF YEAR COLUMN B

EXPENSES (A) COLUMN C

(DESCRIBE) (C) COLUMN E

(in thousands)

Restructuring Reserve

December 29, 2019

January 3, 2021 $ 11,445 $ ( 4,626 ) $ — $ 5,755 $ 1,064

December 29, 2019 11,907 7,944 49 8,357 11,445

3 unchanged sentences

(DESCRIBE) (B)

OF YEAR COLUMN B

EXPENSES (A) COLUMN C

ACCOUNTS COLUMN D

(DESCRIBE) (B) COLUMN E

(in thousands)

Warranty and Sales Allowances Reserves

December 29, 2019

January 3, 2021 $ 3,853 $ 1,062 $ — $ 1,667 $ 3,248

December 29, 2019 3,495 1,519 — 1,161 3,853

4 unchanged sentences

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

February 26, 2020

INTERFACE, INC.

March 3, 2021 INTERFACE, INC.

/s/ DANIEL T.

4 unchanged sentences

Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature Capacity Date

/s/ DANIEL T.

President, Chief Executive Officer and Chairman of the Board and Director

February 26, 2020

Vice President and Chief Financial Officer

February 26, 2020

(Principal Financial Officer)

February 26, 2020

/s/ ANDREW B.

February 26, 2020

/s/ DWIGHT GIBSON

February 26, 2020

HENDRIX President, Chief Executive Officer and Chairman of the Board and Director March 3, 2021

HAUSMANN Vice President and Chief Financial Officer March 3, 2021

Hausmann (Principal Financial Officer)

/s/ ROBERT PRIDGEN Vice President and Chief Accounting Officer March 3, 2021

Robert Pridgen (Principal Accounting Officer)

BURKE Director March 3, 2021

/s/ DWIGHT GIBSON Director March 3, 2021

Dwight Gibson

February 26, 2020

/s/ CHRISTOPHER G.

February 26, 2020

KENNEDY Director March 3, 2021

Christopher G.

/s/ JOSEPH KEOUGH

February 26, 2020

/s/ JOSEPH KEOUGH Director March 3, 2021

Joseph Keough

/s/ CATHERINE M.

February 26, 2020

/s/ DAVID KOHLER

February 26, 2020

KILBANE Director March 3, 2021

/s/ DAVID KOHLER Director March 3, 2021

/s/ SHERYL D.

February 26, 2020

PALMER Director March 3, 2021

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures