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FORM 11-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES EXCHANGE ACT OF
1934
For the fiscal year ended December 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the transition period from _______ to _________
Commission file number 1-2116
ROBBINS HARDWOOD FLOORING, INC. EMPLOYEES' RETIREMENT SAVINGS PLAN
(Full title of the Plan)
ARMSTRONG WORLD INDUSTRIES, INC.
2500 Columbia Avenue Lancaster, Pennsylvania 17604
(Name of issuer of the securities held pursuant to the Plan
and the address of its principal executive office)
1
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Page No.
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Item 1. Independent Auditors' Report 4
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Item 2. Statements of Net Assets Available for Benefits 5
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December 31, 1999 and 1998
Item 3. Statements of Changes in Net Assets Available for Benefits 6
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Years ended December 31, 1999 and 1998
Notes to Financial Statements 7-14
Schedule of Assets Held for Investment Purposes 15
Exhibits 16
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Consent of Independent Auditors
2
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the members
of the committee constituting the administrator which administers the plan have
duly caused this annual report to be signed by the undersigned hereunto duly
authorized.
ROBBINS HARDWOOD FLOORING, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
June 26, 2000 By: /s/ Jennifer E. Wisdom
---------------------------
Jennifer E. Wisdom Vice President Human Resources
3
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Independent Auditors' Report
To the Profit Sharing Committee of the
Robbins Hardwood Flooring, Inc.
Employees' Retirement Savings Plan:
We have audited the accompanying statements of net assets available for benefits
of the Robbins Hardwood Flooring, Inc. Employees' Retirement Savings Plan as of
December 31, 1999 and 1998, and related statements of changes in net assets
available for benefits for the years then ended. These financial statements are
the responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Robbins
Hardwood Flooring, Inc. Employees' Retirement Savings Plan as of December 31,
1999 and 1998, and the changes in net assets available for benefits for the
years then ended in conformity with generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets held
for investment purposes is presented for the purpose of additional analysis and
is not a required part of the basic financial statements but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. The supplemental schedule has been subjected to the auditing procedures
applied in the audits of the basic financial statements and, in our opinion, is
fairly stated in all material respects in relation to the basic financial
statements taken as a whole.
KPMG LLP
Dallas, Texas
June 16, 2000
4
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ROBBINS HARDWOOD FLOORING, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
Statements of Net Assets Available for Benefits
December 31, 1999 and 1998
<TABLE>
<CAPTION>
1999 1998
------------ ------------
<S> <C> <C>
Assets:
Investments, at fair value (note 5):
Armstrong Holdings, Inc. common stock $ 4,269 $ --
Fidelity Magellan Fund 1,952,506 1,675,089
Fidelity Equity Income Fund 172,433 232,081
Fidelity Intermediate Bond Fund 111,872 95,871
Fidelity Overseas Fund 15,969 4,477
Fidelity Asset Manager Fund 130,428 101,923
Fidelity Retirement Money Market Fund 974,954 879,934
Participant loans 121,683 65,769
------------ ------------
Total investments 3,484,114 3,055,144
------------ ------------
Receivables:
Employer contributions (note 2) -- 148,980
Employee contributions (note 2) 2,364 5,602
------------ ------------
Total receivables 2,364 154,582
------------ ------------
Total assets 3,486,478 3,209,726
------------ ------------
Net assets available for benefits $ 3,486,478 $ 3,209,726
============ ============
</TABLE>
See accompanying notes to financial statements.
5
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ROBBINS HARDWOOD FLOORING, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
Statements of Changes in Net Assets Available for Benefits
Years ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
1999 1998
------------ -----------
<S> <C> <C>
Additions to net assets attributed to:
Investment income:
Interest and dividend income $ 250,815 $ 110,300
Net appreciation in fair value of investments (note 5) 218,592 365,755
------------ -----------
Net investment income 469,407 476,055
------------ -----------
Employer contributions (note 2) 7,909 245,495
Participant contributions (note 2) 285,364 316,545
Plan assets transferred in due to plan merger (note 10) -- 383,038
Rollovers (note 3) 4,870 --
------------ -----------
Total additions 767,550 1,421,133
------------ -----------
Deductions from net assets attributable to benefits paid
to participants (notes 2 and 3) 490,798 384,373
------------ -----------
Net increase 276,752 1,036,760
Net assets available for benefits at beginning of the year 3,209,726 2,172,966
------------ -----------
Net assets available for benefits at end of year $ 3,486,478 $ 3,209,726
============ ===========
</TABLE>
See accompanying notes to financial statements.
6
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ROBBINS HARDWOOD FLOORING, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 1999 and 1998
(1) General Information
The Robbins Hardwood Flooring, Inc. Employees' Retirement Savings Plan (the
Plan) became effective on March 28, 1997.
(2) Description of the Plan
The following description of the Plan provides only general information.
Participants should refer to the Plan document for more detailed
information.
(a) General
The Plan is a defined contribution plan which provides retirement
benefits to employees of the Triangle Pacific Corp. (the Plan
administrator or the Company) Robbins Hardwood Flooring, Inc. division
who are not members of a collective bargaining agreement who work at
least 1,000 hours annually, with new participants required to be at
least 21 years of age and employed by the Company at least one year.
The Plan is administered by Triangle Pacific Corp. and advised by the
retirement committee appointed by the Board of Directors. The Plan is
subject to the provisions of the Employee Retirement Income Security
Act of 1974 (ERISA).
(b) Contributions
Participants are permitted to contribute up to 16% of their eligible
compensation to the Plan, as defined by the committee. Participants
may elect to invest their contributions in any of the available
investment funds offered by the Fidelity Management Trust Company, the
Trustee. Participants are able to direct all contributions to their
account in 25% increments to the investment funds offered by the
Trustee.
The Company provides a 25% match of active participants contributions,
up to 4% of the participant's eligible compensation. Effective
November 1, 1999, the Plan was amended to increase the Company match
up to 6% of the participant's eligible compensation for members of a
collective bargaining agreement. Additionally, the Plan includes a
profit sharing component. The Company may contribute a discretionary
profit sharing amount solely at the discretion of the Board of
Directors.
(c) Participant Accounts
Each participant's account is credited with the participant's
contribution and an allocation of the Company's contributions, Plan
earnings, and forfeitures of terminated participants' non-vested
accounts. Allocations to participant accounts are based on the
participant's annual earnings for profit sharing contributions. The
benefit to which a participant is entitled is the benefit that can be
provided from the participant's vested account.
(Continued)
7
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ROBBINS HARDWOOD FLOORING, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 1999 and 1998
(d) Vesting
Participants are fully vested in their voluntary contributions plus
actual earnings thereon. Employee vesting in the Company's matching
and profit sharing contributions is based on the participant's years
of service with the Company. The participants are vested on an
incremental basis. The participants become 20% vested after one year
of service. The vesting percentage increases 20% a year until becoming
fully vested after five years of service.
(e) Investment Options
Elective and nondeductible contributions may be invested in a
guaranteed income fund, fixed income funds, equity funds or a money
market fund at the option of the participating employee. The Plan has
investment options available to which participants may allocate their
contributions follow:
. Armstrong Holdings, Inc. Common Stock - Effective April 1,
1999, the Plan was amended to include Armstrong Holdings,
Inc. common stock as one of the investment options.
Armstrong Holdings, Inc. (formerly Armstrong World
Industries, Inc.) is the parent company of Triangle Pacific
Corp. (see note 6). Armstrong is publicly traded on the New
York Stock Exchange.
. Fidelity Magellan Fund - The Fidelity Magellan Fund is a
diversified portfolio of common stocks of domestic and
foreign issuers. The portfolio seeks capital appreciation by
investing in growth stocks, value stocks or both.
. Fidelity Equity Income Fund - The Fidelity Equity Income
Fund has a primary objective of seeking reasonable income by
investing 65% of total assets in foreign and domestic income
producing equity securities, such as stocks, bonds and other
debt securities. The fund also seeks capital appreciation
when consistent with its primary objective.
. Fidelity Intermediate Bond Fund - The Fidelity Intermediate
Bond Fund has a primary objective of seeking high current
income by investing in U.S. dollar-dominated investment
grade debt securities with maturities between three to ten
years. The Lehman Brothers' Intermediate
Government/Corporate Bond Index is used as a guide in
structuring the fund and selecting the investments.
. Fidelity Overseas Fund - The Fidelity Overseas Fund seeks
long-term growth of capital by primarily investing in the
common stock of foreign issuers.
. Fidelity Asset Manager Fund - The Fidelity Asset Manager
Fund strives for high total return with reduced risk over
the long term. The fund pursues this goal with diversified
investments of stocks, bonds and short-term and money market
instruments, both domestic and international, while
maintaining a diversified mix of securities.
(Continued)
8
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ROBBINS HARDWOOD FLOORING, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 1999 and 1998
. Fidelity Retirement Money Market Fund - The Fidelity
Retirement Money Market Fund seeks to earn a high level of
current income while maintaining a stable $1.00 share price
by investing in high-quality, short-term securities. These
securities may include, but are not limited to, high-quality
short-term U.S. dollar denominated money market securities,
domestic and foreign issuers.
In March 1998, the Plan was amended to include the common stock of
Triangle Pacific Corp. as an investment option for participants
effective April 1, 1998. The Plan did not own any Triangle Pacific
Corp. stock at December 31, 1998 or 1999.
(f) Participant Loans
Participants may borrow from the Plan an amount less than 50% of the
participant's vested account balance. In no event can the participant
borrow more than $50,000. Loans are for a period not to exceed five
years, except for loans to acquire any dwelling to be used as the
principal residence for the participant, and bear interest at a
reasonable rate as established by the Plan Administrator. Interest
rate for 1999 was 9.25%.
(g) Payment of Benefits
On termination of service due to death, disability or retirement, a
participant may elect to receive either a lump-sum distribution, or a
rollover into another investment. The timing of the lump-sum payment
will be determined by the Plan administrator or disbursed as soon as
administratively feasible upon filing a notice with the Employee
Benefits Department. For termination of service due to other reasons,
a participant may receive the value of the vested interest in his or
her account as a lump-sum distribution. Participants may make hardship
withdrawals from their earnings deferred contributions at specified
times, subject to the determination by the Plan Administrator, that
the withdrawal is required to meet an immediate and heavy financial
need.
(h) Forfeitures
Employer profit sharing contributions forfeited by terminating
employees are used to restore forfeitures for participants who resume
employment with the Company within five years of termination with any
excess added to future Company contributions to the Plan. Employer
matching contributions forfeited by terminating employees are used to
reduce future employer matching contributions. For the years ended
December 31, 1999 and 1998, forfeitures resulting from nonvested
employee terminations were $8,421 and $7,185, respectively. Effective
October 31, 1998, all forfeitures will be used to reduce employer-
matching contributions.
(Continued)
9
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ROBBINS HARDWOOD FLOORING, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 1999 and 1998
(3) Summary of Significant Accounting Policies
(a) Basis of Accounting
The financial statements of the Plan are prepared under the accrual
method of accounting.
(b) Investment Valuation and Income Recognition
The Plan's investments are stated at fair value and have been
determined based on closing market quotations. Purchases and sales of
securities are recorded by the trustee at current cost on the trade
date. Realized and unrealized gains (losses) on investments are based
on the fair value of the assets at the beginning of the Plan year or
at the time of purchase during the year. Interest income is recorded
on the accrual basis. Dividends are recorded on the ex-dividend date.
(c) Administration Expenses
In accordance with the provisions of the Plan, unless paid by the
Company, all costs of administering the Plan are charged to the Plan.
During 1999 and 1998, all significant expenses were paid by the
Company.
(d) Payment of Benefits
Benefits are recorded when distributed.
(e) Rollover Contributions
Employee rollovers represent receipts from employees receiving
distributions from their previous employers' qualified plan(s).
(f) Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets,
liabilities, and change therein, and disclosure of contingent assets
and liabilities. Actual results could differ from those estimates.
(Continued)
10
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ROBBINS HARDWOOD FLOORING, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 1999 and 1998
(4) Units
Participant accounts are assigned investment fund units/shares. The net
asset value per unit/shares by fund/account for the 1999 and 1998 calendar
quarters ended are as follows:
<TABLE>
<CAPTION>
1999 Quarters Ended
--------------------------------------------------------- Units at
December 31,
March 31 June 30 September 30 December 31 1999
---------- ----------- -------------- ------------- --------------
<S> <C> <C> <C> <C> <C>
Armstrong Holdings,
Inc. common
stock $ 45.19 $ 57.81 $ 44.94 $ 33.37 128
Fidelity Magellan
Fund 129.75 129.77 122.02 136.63 14,290
Fidelity Equity
Income Fund 55.92 61.63 56.03 53.48 3,224
Fidelity Intermediate
Bond Fund 10.16 9.96 9.88 9.76 11,462
Fidelity Overseas
Fund 36.99 38.88 41.11 48.01 333
Fidelity Asset
Manager Fund 17.54 18.08 17.28 18.38 7,096
Fidelity Retirement
Money Market
Fund 1.00 1.00 1.00 1.00 974,954
</TABLE>
<TABLE>
<CAPTION>
1998 Quarters Ended
--------------------------------------------------------- Units at
December 31,
March 31 June 30 September 30 December 31 1998
---------- ----------- -------------- ------------- --------------
<S> <C> <C> <C> <C> <C>
Fidelity Magellan
Fund $ 108.81 $ 109.63 $ 97.52 $ 120.82 13,864
Fidelity Equity
Income Fund 57.51 57.20 49.60 55.55 4,178
Fidelity Intermediate
Bond Fund 10.17 10.20 10.40 10.27 9,335
Fidelity Overseas
Fund 37.09 37.70 31.14 35.98 124
Fidelity Asset
Manager Fund 19.59 19.54 18.24 17.39 5,861
Fidelity Retirement
Money Market
Fund 1.00 1.00 1.00 1.00 879,934
</TABLE>
11 (Continued)
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ROBBINS HARDWOOD FLOORING, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 1999 and 1998
(5) Investments
In September 1999, the American Institute of Certified Public Accountants
issued Statement of Position 99-3, Accounting for and Reporting of Certain
Defined Contribution Plan Investments and Other Disclosure Matters (SOP 99-
3). SOP 99-3 simplifies the disclosure for certain investments and is
effective for plan years ending after December 15, 1999. The Plan adopted
SOP 99-3 during the Plan year ending December 31, 1999. Accordingly,
information previously required to be disclosed about participant directed
fund investment programs is not presented in the Plan's 1999 financial
statements. The Plan's 1998 financial statements have been reclassified to
conform with the current year's presentation.
The following investments exceed 5% of the Plan's net assets available for
Plan benefits at December 31, 1999 and 1998:
<TABLE>
<CAPTION>
1999 1998
------------- --------------
<S> <C> <C>
Fidelity Magellan Fund $ 1,952,506 $ 1,675,089
Fidelity Equity Income Fund 172,433 232,081
Fidelity Retirement Money Market Fund 974,954 879,934
Other - less than 5% 384,221 268,040
------------- --------------
Total investments $ 3,484,114 $ 3,055,144
============= ==============
</TABLE>
During 1999 and 1998, the Plan's investments had net realized and
unrealized and unrealized gains (losses) as follows:
<TABLE>
<CAPTION>
1999 1998
------------- --------------
<S> <C> <C>
Triangle Pacific Corp. common stock $ -- $ 3,626
Janus Institutional Money Market Fund -- 696
Armstrong Holdings, Inc. common stock (1,745) --
Fidelity Magellan Fund 219,931 372,871
Fidelity Equity Income Fund (3,590) (3,786)
Fidelity Intermediate Bond Fund (5,359) 437
Fidelity Overseas Fund 2,984 195
Fidelity Asset Manager Fund 6,371 (8,284)
------------- --------------
Net appreciation in fair value
of investments $ 218,592 $ 365,755
============= ==============
</TABLE>
12 (Continued)
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ROBBINS HARDWOOD FLOORING, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 1999 and 1998
The components of investment income for the years ended December 31, 1999
and 1998 are as follows:
<TABLE>
<CAPTION>
1999 1998
------------ ------------
<S> <C> <C>
Investment income:
Interest and dividend income $ 250,815 $ 110,300
Net appreciation in fair value of investments 218,592 365,755
------------ ------------
$ 469,407 $ 476,055
============ ============
</TABLE>
(6) Acquisition
On July 22, 1998, Triangle Pacific Corp. was acquired by Armstrong World
Industries, Inc. (a subsidiary of Armstrong Holdings, Inc.). The Board of
Directors of Triangle Pacific Corp. intends to continue providing
retirement benefits through the Company's defined contribution plans.
(7) Tax Status of the Plan
The Company has not yet received a determination letter from the Internal
Revenue Service as of December 31, 1999. However, the Plan administrator
and the Plan's management believe that the Plan is designed and is
currently being operated in compliance with the applicable requirements of
the Internal Revenue Code.
(8) Plan Termination
Although it has not expressed intent to do so, the Plan administrator has
the right to terminate the Plan at any time, subject to the provisions of
ERISA. In the event of termination, participants will become fully vested
in their accounts.
(9) Plan Merger
On October 20, 1998, the Board of Director's approved the merger of the
Robbins Hardwood Flooring, Inc. Profit Sharing Plan into the Robbins
Hardwood Flooring, Inc. Employees' Retirement Savings Plan. All plan assets
were liquidated and transferred to Fidelity Management Trust Company,
trustee for this Plan, on October 1, 1998.
(10) Related Party Transactions
Certain Plan investments are shares of common stock of Armstrong Holdings,
Inc. and shares of mutual funds managed by Fidelity Investments. Triangle
Pacific Corp. is a wholly-owned subsidiary of Armstrong Holdings, Inc.
Fidelity Management Trust Company is the trustee as defined by the Plan.
Therefore, transactions involving these entities or funds qualify as party-
in-interest transactions.
13 (Continued)
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ROBBINS HARDWOOD FLOORING, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 1999 and 1998
(11) Subsequent Event
Effective January 1, 2000, the Plan increased the employer matching
percentage to 50% of qualified employee contributions up to 6% of the
employee's annual earnings for all participants who are not covered under
a collective bargaining agreement.
14
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Schedule 1
ROBBINS HARDWOOD FLOORING, INC.
EMPLOYEES' RETIREMENT SAVINGS PLAN
Schedule of Assets Held for Investment Purposes at end of
year December 31, 1999
Current
Identity of issuer Description of investment value
--------------------------- ---------------------------------- -----------
Armstrong Holdings, Inc.* Common stock $ 4,269
Fidelity Investments* Fidelity Magellan Fund 1,952,506
Fidelity Investments* Fidelity Equity Income Fund 172,433
Fidelity Investments* Fidelity Intermediate Bond Fund 111,872
Fidelity Investments* Fidelity Overseas Fund 15,969
Fidelity Investments* Fidelity Asset Manager Fund 130,428
Fidelity Investments* Fidelity Retirement Money Market 974,954
Participant loans * Loans to participants 121,683
-----------
Total investments $ 3,484,114
===========
*Party-in-interest
See accompanying independent auditors' report.
15
