Armor wil be reduced (ie you can have negative armor)...

FYI (in case you didn't know)....

Armor reduces damage done to hull and acts as a damage modifier:

1 / (1 + 0.05 x armor)

At small values, each armor point results in ~5% reduction in hull damage...however, as you continually increase the armor, each additional armor point becomes less and less useful...for example, 20 armor would halve the incoming hull damage (compared to zero armor), and 60 armor would reduce hull damage to 25% of normal (zero armor)...

On the flip side, negative armor becomes more and more damaging for each point....a net -5 armor would increase hull damage by one third from normal (zero armor), while a -10 armor would double the hull damage...

why is the undulation so hypnotic....

Not to mention the very fact that each sequential armor is worth less in a way works in your favor as well- Getting a bunch of armor means that the armor stripped from you by armor reducing effects is less valuable(since an armor subtraction always removes the most recently acquired points of armor first).

IE:

Going from 0 armor to -6 is a 43% incoming damage increase.

Going from 4 armor to -2 is a 33% incoming damage increase.

Going from 6 armor to 0 is a 30% incoming damage increase.

Going from 8 armor to 2 is a 27% incoming damage increase.

So having more armor also pads you against armor reductions as well.

I'm assuming that it is in fact reversed as opposed to what Sel said earlier.  I'm assuming that they simply check if armor is negative and if so, apply the same effects but in reverse, thus -20 armor wouldn't be infinite, it would be double damage.