Victor Grizzle
ARMSTRONG WORLD INDUSTRIESAbout Victor Grizzle
Victor D. Grizzle is President & CEO of Armstrong World Industries (AWI) and a director since 2016; he was appointed CEO in March 2016 and is age 63 as of March 31, 2025 . Under his leadership, AWI delivered strong 2024 results (net sales $1,446M, adjusted EBITDA $486M) and annualized absolute TSR of 15.3% for the 2022–2024 PSU period . In 2024, AWI cited approximately 45% shareholder return and ~$1.8B incremental shareholder value, and reaffirmed strategic execution including acquisitions (3form LLC, A. Zahner Company) and product innovation (Templok) . Grizzle’s background spans global operations and manufacturing leadership at Valmont Industries, EaglePicher, and 16 years at GE Silicones; he also serves on the board of Franklin Electric .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| AWI (Armstrong Building Products) | EVP & CEO, Armstrong Building Products | Jan 2011–Mar 2016 | Led business unit; platform for elevation to AWI CEO |
| Valmont Industries | Group President, Global Engineered Support Structures Coatings & Tubing; President, International Division (Omaha) | Jan 2006–2011 | Global operations leadership in infrastructure/ag equipment |
| EaglePicher Corporation | President, Commercial Power Division | Prior to 2006 | Manufacturing and resource businesses leadership |
| General Electric (GE) Silicones | American business leader | 16 years | Deep manufacturing and operations expertise |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Franklin Electric | Director | Current | Industry experience; oversight for global water/auto fuel components |
Fixed Compensation
Multi-year CEO compensation (Summary Compensation Table):
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Salary ($) | 927,000 | 981,750 | 1,000,000 |
| Stock Awards ($) | 4,433,797 | 11,019,636 | 6,137,577 |
| Non-Equity Incentive Plan Compensation ($) | 658,170 | 1,436,310 | 1,738,000 |
| All Other Compensation ($) | 255,691 | 104,020 | 278,684 |
| Total ($) | 6,274,658 | 13,541,716 | 9,154,261 |
Additional fixed program parameters (2024):
- Annual Incentive Plan (AIP) target: 110% of base salary .
- AIP payouts are linearly scaled and capped at 200% of target; PSUs capped at 275% (weighted average) .
Performance Compensation
2024 AIP metrics, outcomes, and payout:
| Metric | Target ($M) | Actual ($M) | Performance % of Target | Payout % of Target |
|---|---|---|---|---|
| Revenue (30% weight) | 1,352 | 1,376 | 102% | 135% |
| Adjusted EBITDA (70% weight) | 458 | 478 | 104% | 168% |
| Weighted Payout Factor | — | — | — | 158% |
| CEO AIP paid ($) | — | — | — | 1,738,000 |
2024 LTIP structure (granted Feb 21, 2024; performance period Jan 1, 2024–Dec 31, 2026):
- Mix: 60% PSUs, 40% RSUs; CEO LTIP target $5.4M (540% of base) .
- PSU metrics and weights: Absolute TSR 60%; 3-year cumulative adjusted Free Cash Flow 25%; Mineral Fiber adjusted EBITDA 15% .
- Absolute TSR payout scale (annualized): 5%→50%; 10%→100%; 20%→300%; starting price $120.47; ending price measured via 30/60-day VWAP immediately after Jan 4, 2027 .
- FCF targets: $863M at 100%; thresholds/maximums specified .
- MF adjusted EBITDA targets: $1,187M at 100%; thresholds/maximums specified .
- RSUs: three-year cliff vest March 1, 2027, subject to continued employment .
Payout results for 2022–2024 PSU cohort (certified Apr 8, 2025):
| Metric | Weight | Target | Actual | Payout Factor | Vesting |
|---|---|---|---|---|---|
| Annualized Absolute TSR | 60% | 10% target | 15.3% | 206% | Apr 8, 2025 |
| Cumulative Adjusted FCF | 25% | $860M | $768M | 73% | Apr 8, 2025 |
| Mineral Fiber Volume (MFV) | 15% | — | Below threshold | 0% | Apr 8, 2025 |
| Weighted PSU Payout | — | — | — | 142% | Apr 8, 2025 |
| CEO Shares Payout (#) | — | 45,015 granted | — | 63,855 paid | Apr 8, 2025 |
Special CEO retention grant (one-time):
- 72,823 time-based RSUs granted Apr 28, 2023; three-year cliff vest Apr 28, 2026; acceleration on involuntary termination for Good Reason; pro-rata on death/LTD; intended retentive value given age and succession planning .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership (Mar 31, 2025) | 357,576 common shares; 130,900 RSUs; total common plus RSUs 488,476 |
| Ownership % | Company notes no individual officer/director owns ≥1% outstanding shares |
| Stock ownership guidelines | CEO must hold ≥6x annual base salary; compliance met by Dec 2024 |
| Hedging/pledging | Prohibited (puts/calls/shorts/swaps/straddles), margin accounts, pledging; Rule 10b5-1 plans allowed subject to pre-approval and MNPI restrictions |
| Option awards | AWI notes NEOs do not receive stock options as part of compensation program |
| Outstanding awards (12/31/2024) | RSUs: 25,744 (3/1/2023), 72,823 (4/28/2023 retention), 18,143 (2/21/2024); PSUs: 38,616 (2023), 27,214 (2024); 2022 PSU grant previously outstanding and paid in Apr 2025 per certification |
Employment Terms
| Provision | CEO Terms |
|---|---|
| Severance (no CIC) | 2.0x base salary + target AIP; pro-rated AIP based on actual performance; health/welfare continuation; outplacement |
| Severance (CIC, double-trigger) | 2.5x base salary + target AIP; pro-rated AIP; accelerated vesting (if assumed, double-trigger; if not assumed, committee may cash out) |
| CIC agreement term | Fixed one-year term auto-renews annually; if CIC occurs, term continues for two years |
| 280G/4999 | Best-net reduction; no tax gross-ups |
| Non-compete | 12 months post-termination—no competitive business engagement |
| Non-solicit (customers) | 24 months post-termination—no solicitation/diversion |
| Non-solicit (employees) | 24 months post-termination—no employee solicitation |
| Clawback (mandatory) | Dodd-Frank/NYSE-compliant clawback for restatements; recovery on pre-tax basis; limited discretion except impracticability exceptions |
| Additional recoupment | Discretionary recoupment for misconduct, competition, solicitation, or covenant breaches |
Estimated CEO payments under scenarios (as of 12/31/2023 inputs):
| Scenario | Cash Severance | Pro-rated Bonus | Health/Outplacement | Accelerated Equity | Total |
|---|---|---|---|---|---|
| Involuntary w/o Cause | $4,200,000 | $1,100,000 | $210,000 outplacement | — | $5,510,000 |
| Termination for Good Reason | $4,200,000 | $1,100,000 | $210,000 outplacement | — | $5,510,000 |
| CIC + qualifying termination | $5,250,000 | $1,100,000 | $40,700 health + $210,000 outplacement | PSUs $12,341,618; RSUs $9,691,107 | $28,633,426 |
Board Governance
- Grizzle is a director since 2016 and is not independent (as CEO); all other nominees (2024, 2025) determined independent under NYSE and AWI principles .
- Board leadership is split since 2010: independent Chair (Roy W. Templin) and CEO; split mitigates dual-role concerns and supports independent oversight, including executive sessions .
- Committees are fully independent (Audit; Management Development & Compensation; Finance; Nominating, Governance & Social Responsibility), with named chairs and meeting activity (Audit met 5x; MDCC 7x; Finance 4x; NGSRC 5x in 2024) .
- Directors are expected to attend ≥75% of board/committee meetings; 2024 attendance met by nominees; most directors attended annual meetings .
Director service and committee matrix (2025 nominees):
| Director | Committees | Chair Roles |
|---|---|---|
| Victor D. Grizzle | — | — |
| Richard D. Holder | Audit, Finance, NGSRC | NGSRC Chair |
| Barbara L. Loughran | Audit, Finance, NGSRC | Audit Chair |
| William H. Osborne | MDCC, NGSRC | — |
| Wayne R. Shurts | Audit, MDCC | MDCC Chair |
| Roy W. Templin (Chair) | Audit, Finance | Finance Chair |
| Kathleen E. Pitre (nominee) | — | — |
Compensation Structure Analysis
- Shift in LTIP mix from 100% PSUs (pre-2023) to 60% PSUs / 40% RSUs beginning 2023, aligning with market practice for retention while maintaining performance orientation .
- CEO LTIP target increased modestly in 2024 to position compensation near 75th percentile given performance and tenure .
- 2025 changes reduced PSU maximum weighted payout from 275% to 250% and tightened retirement provision from 55/5 to 60/5 eligibility (minimum 10 months service post-grant), moderating upside risk and retentive dynamics .
- One-time CEO retention grant (Apr 2023) lacked performance conditions and contributed to 2024 say-on-pay opposition; AWI conducted extensive investor outreach and committed that future special awards would be rare and consider performance metrics .
Compensation Peer Group & Say-on-Pay
- 2024 peer group of 17 manufacturing companies (e.g., AAON, Franklin Electric, AZEK, SPX Technologies, CSW Industrials, Trex, Masonite, etc.), used for benchmarking .
- 2024 say-on-pay approval was 61% (down from typical ~95%); AWI’s outreach identified retention grant concerns and led to disclosure and program adjustments .
Equity Award Grant Practices and Risk
- Annual equity grants made shortly after year-end earnings release; grant date post disclosure; committee may grant throughout year for hires/promotions .
- 2025 compensation risk assessment concluded programs do not encourage excessive risk ; clawback and prohibitions on hedging/pledging reinforce alignment .
Performance & Track Record
- 2024: Net sales +12% to $1,446M; operating income $374M (+16%); adjusted EBITDA $486M (+13%); adjusted FCF $298M (+13%) .
- Mineral Fiber segment operating income $323M (+13%); adjusted EBITDA $406M (+11%) .
- TSR for 2022–2024 PSU cohort 15.3%; PSU payout 142% driven by strong TSR, partially offset by FCF shortfall and MFV underperformance .
Investment Implications
- Alignment: CEO meets stringent 6x salary ownership guideline; prohibitions on hedging/pledging reduce agency risk .
- Pay-for-performance: 60% PSU weighting with TSR/FCF/Mineral Fiber metrics, AIP tied to revenue/EBITDA; 2024 AIP paid 158% on strong execution .
- Retention/transition risk: 2023 one-time time-vested RSU grant vests Apr 2026, clearly retentive; 2025 retirement rule change (60/5) decreases early pro-rata vesting, modestly increasing retention via longer service requirement .
- Change-in-control economics: Double-trigger CIC with 2.5x cash multiple plus accelerated equity could be material; investors should factor potential overhang in M&A scenarios .
- Governance mitigants: Split Chair/CEO structure and fully independent committees offset dual-role independence concerns; continued shareholder engagement post 2024 vote suggests responsiveness .
Overall, Grizzle’s incentives are tightly linked to TSR, FCF and EBITDA performance with robust ownership/recoupment policies; the 2023 retention award created near-term governance scrutiny, but program adjustments in 2025 indicate responsiveness and improved balance between at-risk pay and retention .