MILLERKNOLL, INC. Item 1.01 Entry into a Material Definitive Agreement.
Agreement and Plan of Merger
On
The Merger Agreement provides that, among other things and subject to the terms
and conditions of the Merger Agreement, (a) Merger Sub will be merged with and
into Knoll (the "Merger"), with Knoll being the surviving corporation in the
Merger, and, (b) at the effective time of the Merger (the "Effective Time"),
each issued and outstanding share of common stock, par value
The Merger Agreement does not provide for the payment of any consideration with
respect to the issued and outstanding shares of preferred stock, par value
The Merger Agreement provides that outstanding Knoll equity awards will be treated as follows at the Effective Time: (a) each outstanding and unexercised option award to purchase shares of Knoll Common Stock, whether or not vested, will be cancelled in consideration for the right to receive an amount in cash, without interest and less applicable withholding taxes, equal to the product of (i) the excess, if any, of the value of the Merger Consideration over the exercise price per share of Knoll Common Stock subject to such option immediately prior to the Effective Time multiplied by (ii) the number of shares of Knoll Common Stock subject to such option immediately prior to the Effective Time; (b) except as provided below, each outstanding award of restricted Knoll Common Stock will be converted into an award in respect of a number of shares of restricted common stock of the Company equal to the product of (i) the number of shares of Knoll Common Stock subject to the award multiplied by (ii) the sum of (A) the Exchange Ratio and (B) the quotient of (x) the Cash Consideration divided by (y) the volume weighted average price per share of Company Common Stock on the NASDAQ for the five consecutive trading days ending the two trading days prior to the closing date (such sum, the "Equity Award Exchange Ratio"); (c) each outstanding award of restricted common stock of Knoll held by an individual who is a non-employee director of Knoll as of the closing date will fully vest and be converted into the right to receive the Merger Consideration and any accrued but unpaid dividends in respect of each share of Knoll Common Stock subject to the award; (d) except as provided below, each outstanding award of performance units will be converted into a time-vesting restricted unit award in respect of a number of shares of restricted common stock of the Company equal to the product of (i) the number of shares of Knoll Common Stock subject to the award (determined by deeming performance goals to be achieved at 100%) multiplied by (ii) the Equity Award Exchange Ratio; (e) each outstanding award of performance units relating to Knoll Common Stock with performance conditions that are based on the performance of a specified Knoll subsidiary will be converted into a performance unit award, in respect of a number of shares of Company Common Stock equal to the product of (i) the number of shares of Knoll Common Stock subject to the award multiplied by (ii) the Equity Award Exchange Ratio; and (f) each outstanding award of performance units that is held by an individual who is a former employee of Knoll, and remains eligible to vest, will be cancelled and converted into the right to receive the Merger Consideration in respect of each share of Knoll Common Stock subject to the award (determined by deeming performance goals achieved at 100% and prorated to the extent contemplated by the applicable award agreement) and any accrued but unpaid dividends in respect of each share of Knoll Common Stock subject to the award.
In connection with its entry into the Merger Agreement, on
The Company's board of directors has unanimously (1) determined that the Merger
Agreement and the transactions contemplated thereby, including the issuance of
the shares of Company Common Stock, (the "Company Stock Issuance"), are fair to,
and in the best interests of, the Company's stockholders, (2) approved and
declared advisable the Merger Agreement and the transactions contemplated
thereby, including the Company Stock Issuance and (3) resolved to recommend that
the Company's stockholders vote in favor of the Company Stock Issuance.
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The completion of the Merger is subject to satisfaction or waiver of certain
customary closing conditions, including (a) the receipt of the required
approvals from the respective stockholders of the Company and Knoll, (b) the
expiration or termination of the waiting period under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended (the "HSR Act") and any
authorization or consent from a governmental entity required to be obtained with
respect to the Merger having been obtained and remaining in full force and in
effect, without the imposition of a Burdensome Condition (as defined below), (c)
the absence of any governmental order or law making illegal or otherwise
prohibiting the consummation of the Merger or imposing a Burdensome Condition,
(d) the effectiveness of the registration statement on Form S-4 to be filed by
the Company pursuant to which the shares of Company Common Stock to be issued in
connection with the Merger are registered with the
The Merger Agreement contains customary representations and warranties of the Company and Knoll relating to their respective businesses, financial statements and public filings, in each case generally subject to customary materiality qualifiers. Additionally, the Merger Agreement provides for customary pre-closing covenants of the Company and Knoll, including, subject to certain exceptions, covenants relating to conducting their respective businesses in the ordinary course consistent with past practice, excluding actions taken in good faith in order to respond to the COVID-19 pandemic.
The Company and, if requested by the Company, Knoll, each also agreed to take any and all actions and steps necessary to avoid or eliminate each impediment under any antitrust law that may be asserted by any governmental entity or private party and to otherwise satisfy any closing conditions relating to antitrust law contained in the Merger Agreement so as to enable the consummation of the Merger and other transactions contemplated by the Merger Agreement as promptly as practicable; however, the Company will not be required to commit to or effect any action that, individually or in the aggregate, would or would reasonably be expected to have a material adverse effect on the business, financial condition or operations of the Company and its subsidiaries (including Knoll and its subsidiaries) from and after the Effective Time (calculated as if the Company and its subsidiaries from and after the Effective Time were collectively the same size as Knoll and its subsidiaries prior to the Effective Time) (a "Burdensome Condition").
Each of the Company and Knoll has agreed not to solicit alternative acquisition proposals from third parties, to provide non-public information to third parties or to engage in discussions with third parties regarding alternative acquisition proposals, and has agreed to certain restrictions on its ability to respond to any such proposals. However, prior to the receipt of their required stockholder approval, each party's board of directors may withdraw, qualify or modify its recommendation that its stockholders vote in favor of the transaction-related proposals in connection with certain intervening events or receipt of a "Superior Proposal" (as defined in the Merger Agreement), or terminate the Merger Agreement in order to enter into an agreement providing for a Superior Proposal, subject to the requirements and limitations set forth in the Merger Agreement.
The Merger Agreement contains termination rights for each of the Company and
Knoll, including, among others, if the consummation of the Merger does not occur
on or before
Concurrently with the execution of the Merger Agreement, the Company entered into a Voting and Support Agreement (the "Voting Agreement") and the Preferred Stock Purchase Agreement with the Series A Holder.
Pursuant to the Voting Agreement, subject to the terms and conditions therein, the Series A Holder has agreed to, and cause its affiliates to, vote all of the outstanding shares of Knoll Preferred Stock and any shares of Knoll Common Stock then beneficially owned by the Series A Holder or any of its affiliates (a) in favor of the adoption of the Merger Agreement and (b) against (i) any action or agreement that would reasonably be expected to result in a breach of the Merger Agreement or result in any closing condition thereunder not being satisfied on a timely basis and (ii) any proposal related to the entry by Knoll into an alternative transaction, or any other proposal made in opposition to, or in competition with, the Merger. As of the date of the Voting Agreement, an aggregate of 169,165 shares of Knoll Preferred Stock (equivalent to 10,099,402 shares of Knoll Common Stock on an as-converted basis) and 2,404,634 shares of Knoll Common Stock were subject to the Voting Agreement, representing approximately 21% of the total voting power of the holders of Knoll capital stock voting as a single class, with the holders of Knoll Preferred Stock voting on an as-converted basis.
The Voting Agreement also prohibits the Series A Holder from transferring any shares of Knoll Preferred Stock without the Company's consent. The Voting Agreement will terminate upon the earliest to occur of (i) the earlier of (A) the Effective Time, (B) a change of recommendation of the Knoll board of directors and (C) the date the Merger Agreement is terminated pursuant to its terms and (ii) the entry, without the prior written consent of the Series A Holder, into any amendment, waiver or modification or other change to any provision of the Merger Agreement that results in a change in the consideration payable to any holder of equity interests in Knoll or changes the mix of the consideration that would be payable in respect of such equity interests or is . . .
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits Exhibit Number Description 2.1* Agreement and Plan of Merger, by and amongHerman Miller, Inc. , HeatMerger Sub, Inc. and Knoll, Inc., dated as ofApril 19, 2021 . 2.2 Stock Purchase Agreement, by and between Furniture InvestmentsAcquisitions S.C.S. andHerman Miller, Inc. , dated as ofApril 19, 2021 . 10.1 Voting and Support Agreement, by and betweenHerman Miller, Inc. andFurniture Investments Acquisitions S.C.S. , dated as ofApril 19, 2021 . 104 Cover Page Interactive Data File-the cover page XBRL tags are embedded within the Inline XBRL document
* Schedules omitted pursuant to Item 601(b)(2) of Regulation S-K.
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