Herman Miller, Inc. (NasdaqGS:MLHR) entered into a definitive agreement to acquire Knoll, Inc. (NYSE:KNL) from group of shareholders for $1.5 billion on April 19, 2021. Under the the terms of transaction, Knoll shareholders will receive $11.00 in cash and 0.32 shares of Herman Miller common stock for each share of Knoll common stock they own. Upon completion of the transaction, Herman Miller shareholders will own approximately 78% of the combined company and Knoll shareholders will own approximately 22%. In connection with the closing of the transaction, Herman Miller will purchase all of the outstanding shares of Knoll's preferred stock from Investindustrial VII L.P. (“Investindustrial”) for a fixed cash consideration of $253 million, representing an equivalent price of $25.06 for each underlying share of Knoll common stock. Investindustrial has entered into a voting agreement to vote in favor of the transaction at the special meeting of Knoll shareholders to be held in connection with the transaction. Furniture Investments Management S.à r.l. and Furniture Investments S.à r.l. entered into voting and support agreement with Herman Miller. Herman Miller expects to fund the cash portion of the transaction consideration with a combination of new debt and cash on hand. Herman Miller has obtained a commitment from Goldman Sachs for $1.751 billion of senior secured revolving and term loan credit facilities, subject to customary conditions. Upon termination of the Merger Agreement under specified circumstances, including termination (i) by either party in the event of a change of recommendation by the other party's board of directors, (ii) by either party to enter into an agreement in connection with a Superior Proposal or (iii) by either party as a result of a failure to obtain stockholder approval or to close prior to the End Date, in each case following the making of a proposal for an alternative transaction and upon the entry into an alternative transaction within 12 months after the date of such termination, then Knoll may be required to pay Herman Miller a termination fee of $43 million or Herman Miller may be required to pay Knoll a termination fee of $74 million. If the Merger Agreement is terminated as a result of a failure to obtain the requisite approval of Knoll stockholders, Knoll will be required to pay Herman Miller $7.5 million in cash, and if the Merger Agreement is terminated because of a failure to obtain the requisite approval of Herman Miller stockholders, Herman Miller will be required to pay Knoll $15 million in cash. In no event will either party be entitled to receive more than one termination fee, net of any expense reimbursement.

The combined company will have pro forma annual revenue of approximately $3.6 billion and pro forma adjusted EBITDA of approximately $552 million, based on each company's respective last reported 12 months and including the anticipated $100 million of cost synergies, implying adjusted EBITDA margins of approximately 16%. Andi Owen will serve as President and Chief Executive Officer of the combined company. Andrew Cogan plans to depart the combined company upon closing of the transaction after a successful 30-year career with Knoll, during which time Knoll received the National Design Award for Corporate and Institutional Achievement from the Smithsonian's Cooper-Hewitt, National Design Museum. The transaction is subject to approval by Herman Miller and Knoll shareholders, the receipt of required regulatory approvals, the Registration Statement shall have been declared effective by the SEC under the Securities Act and shall not be the subject of any stop order or pending or threatened in writing Proceedings seeking a stop order, the shares of Herman Miller issuable pursuant to the Merger shall have been authorized for listing on the NASDAQ, upon official notice of issuance and the satisfaction of other customary closing conditions. The transaction is not conditioned on financing. The transaction, which has been unanimously approved by the Boards of Directors of both companies. As of June 2, 2021, the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act has been expired. The respective special meetings of Knoll stockholders and Herman Miller shareholders, each is scheduled to be held on July 13, 2021. At the special meeting held on July 13, 2021, the shareholders of both Herman Miller and Knoll approved the merger. The transaction is expected to close by the end of the third quarter of calendar year 2021. As of June 28, 2021, the transaction is expected to close within one week from the date of the shareholder special meetings on July 13, 2021. As of July 13, 2021, the transaction is currently expected to close on Monday, July 19, 2021. The deal is expected to be accretive to Herman Miller's adjusted cash EPS in the first 12 months following closing and is expected to generate significant revenue synergies through enhanced scale, cross selling and digital and eCommerce opportunities.

Goldman Sachs & Co. LLC acted as financial advisor and fairness opinion provider and Adam O. Emmerich, Zachary Podolsky and Jenna E. Levine of Wachtell, Lipton, Rosen & Katz is serving as legal advisor to Herman Miller. Goldman Sachs will receive a transaction fee of $15 million, $3 million of which became payable at announcement of the transactions contemplated by the merger agreement and the preferred stock purchase agreement, and the reminder of which is contingent upon consummation of such transactions. BofA Securities acted as financial advisor and fairness opinion provider and Heather Coleman, Joyce Kwok, Eric Queen, Bradley Smith, Juan Rodriguez, Cathy Clarkin, Joseph J. Matelis, Matthew Brennan, Mehdi Ansari, Ari Blaut, Ronald Creamer, Catherine M. Clarkin and Stephen Kotran of Sullivan & Cromwell is serving as legal advisor to Knoll. BofA Securities will receive a fee of approximately $23 million, $1 million of which was payable upon delivery of its opinion and the remainder of which is payable upon the closing of the merger. Eric L. Schiele, Jamie Madell, Tim Cruickshank, Neel Sachdev and Joshua Ayal of Kirkland & Ellis LLP acted as legal advisor to Global Furniture Investments. Lazard acted as financial advisor to Investindustrial. Steven Seidman and Laura Delanoy of Willkie Farr & Gallagher LLP advised BofA Securities. Computershare Trust Company, N.A. acted as the transfer agent for Knoll and Herman Miller. MacKenzie Partners, Inc. acted as a proxy solicitor for Herman Miller and received a fee of approximately $35,000 plus reasonable and customary costs and expenses. Kingsdale Advisors acted as a proxy solicitor for Knoll and received a fee of approximately $12,500, as well as reasonable and documented out-of-pocket expenses.

Herman Miller, Inc. (NasdaqGS:MLHR) completed the acquisition of Knoll, Inc. (NYSE:KNL) from group of shareholders on July 19, 2021.