<PAGE>
As filed with the Securities and Exchange Commission on August 13, 1999
Registration No. 333-_____
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
KNOLL, INC.
(Exact name of registrant as specified in its charter)
Delaware 13-3873847
(State or other jurisdiction (I.R.S. Employer
of incorporation) Identification No.)
--------------------
1235 Water Street
East Greenville, Pennsylvania 18041
(215) 679-7991
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
--------------------
Patrick A. Milberger, Esq.
Vice President, General Counsel and Secretary
1235 Water Street
East Greenville, Pennsylvania 18041
(215) 679-7991
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
--------------------
with copy to:
Michael A. Schwartz, Esq.
Willkie Farr & Gallagher
787 Seventh Avenue
New York, New York 10019-6099
(212) 728-8000
--------------------
Approximate date of commencement of proposed sale to the public: From time
to time, after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
--------------------
(Cover continued on following page)
<PAGE>
(Cover continued from previous page)
--------------------
<TABLE>
CALCULATION OF REGISTRATION FEE
==================================================================================================================
<CAPTION>
Proposed Proposed
Maximum Maximum
Offering Aggregate Amount of
Title of Each Class of Securities Amount to be Price per Offering Registration
to be Registered Registered Share (1) Price (1) Fee
- ---------------------------------------- --------------------- ------------- ------------------- -----------------
<S> <C> <C> <C> <C>
Common Stock, par value $.01 per share
1,384,858 $26.47 $36,657,192 $10,191
- ---------------------------------------- --------------------- ------------- ------------------- -----------------
(1) Estimated pursuant to Rule 457(c) under the Securities Act solely for the purpose of calculating the
registration fee based upon the average of the high and low prices of the Common Stock as reported on the New
York Stock Exchange on August 11, 1999.
The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay
its effective date until the Registrant shall file a further amendment that specifically states that this
Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of
1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to
said Section 8(a), may determine.
==================================================================================================================
</TABLE>
<PAGE>
The information in this preliminary prospectus is not complete and may be
changed. These securities may not be sold until the registration statement filed
with the Securities and Exchange Commission is effective. This preliminary
prospectus is not an offer to sell these securities and does not seek an offer
to buy these securities in any state where the offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED AUGUST 13, 1999
PROSPECTUS
- ----------
1,384,858 Shares
Knoll, Inc.
Common Stock
This prospectus relates to the offer and sale of up to 1,384,858 shares of
our common stock owned by certain of our stockholders. The selling stockholders
may offer their shares publicly or through private transactions at prevailing
market prices or at negotiated prices.
We will not receive any of the proceeds from the sale of the shares by the
selling stockholders. We have agreed to bear all expenses (other than selling
discounts, concessions or commissions) in connection with the registration and
sale of the shares being offered by the selling stockholders.
Our common stock is listed on the NYSE under the symbol "KNL." On August
12, 1999, the closing price of the common stock, as reported by the NYSE, was
$26-7/16 per share.
We have entered into a merger agreement with Warburg, Pincus Ventures, L.P.
under which a company to be formed by Warburg will merge into Knoll. As a result
of the merger, Warburg and certain members of our management (together with
Knoll employees who may retain shares of common stock issued under Knoll's stock
incentive plans) will become the owners of 100% of the common stock. If the
merger is completed, the shares owned by our public stockholders (including
shares purchased under this prospectus) will be converted into the right to
receive the merger consideration of $28.00 per share. However, completion of the
merger remains subject to various conditions. See "Knoll -- Recent Developments
- -- Merger Agreement."
See "Risk Factors" beginning on page 3 for a discussion of certain factors
that should be considered by prospective investors.
- --------------------------------------------------------------------------------
You should read this prospectus and any prospectus supplement carefully
before you invest.
- --------------------------------------------------------------------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The date of this prospectus is , 1999.
<PAGE>
You should rely only on the information contained in or incorporated by
reference in this prospectus or any prospectus supplement. Neither we nor any
selling stockholder has authorized anyone to provide you with different
information. We are not making an offer of shares in any state where the offer
is not permitted. You should not assume that the information in this prospectus
or any prospectus supplement is accurate as of any date other than the date on
the front of those documents.
TABLE OF CONTENTS
PAGE
----
ABOUT THIS PROSPECTUS..........................................................1
KNOLL..........................................................................1
RISK FACTORS...................................................................3
FORWARD-LOOKING INFORMATION...................................................10
USE OF PROCEEDS...............................................................10
SELLING STOCKHOLDERS..........................................................11
PLAN OF DISTRIBUTION..........................................................12
GENERAL INFORMATION...........................................................13
LEGAL OPINIONS................................................................13
EXPERTS.......................................................................13
WHERE YOU CAN FIND MORE INFORMATION...........................................13
<PAGE>
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
SEC utilizing a "shelf" registration process. From time to time, we may provide
a prospectus supplement to add, update or change information contained in this
prospectus. You should read both this prospectus and any prospectus supplement
together with the additional information described under the heading "Where You
Can Find More Information."
KNOLL
General
We are engaged in the design, manufacture and distribution of office
furniture products and accessories, focusing on the middle to high-end of the
contract furniture market. Our principal executive offices are located at 1235
Water Street, East Greenville, Pennsylvania 18041, and our telephone number is
(215) 679-7991. Our web-site is www.knoll.com.
We offer a broad range of office furniture products and accessories that
support our strategy of being a one-stop source for quality office furniture.
Our five basic product categories offered in North America are as follows:
o office systems,
o seating,
o storage solutions and filing cabinets,
o desks and casegoods and
o tables.
We also offer specialty products that are sold under the KnollStudio,
KnollExtra, KnollTextiles and Spinneybeck names. KnollStudio features our
signature design classics, including high image side chairs, sofas, desks and
tables for both office and home use, while KnollExtra, KnollTextiles and
Spinneybeck feature products that complement our office system and seating
product categories.
Recent Developments -- Merger Agreement
On June 21, 1999, we announced that we had entered into an Agreement and
Plan of Merger (as amended on July 29, 1999, the "Merger Agreement") under which
a company to be formed by Warburg, Pincus Ventures, L.P. ("Warburg") will merge
into Knoll (the "Merger"). As a result of the Merger, Warburg and certain
members of our management (together with Knoll employees who may retain shares
of common stock issued under Knoll's stock incentive plans) will become the
owners of 100% of the common stock.
If the Merger is completed, the shares owned by our public stockholders
(including shares purchased under this prospectus) will be converted into the
right to receive the merger consideration of
<PAGE>
$28.00 per share. If the Merger is not completed prior to November 18, 1999, the
merger consideration of $28.00 per share will be increased at an annual rate of
6.5% from November 18, 1999 until the earlier of the completion of the Merger or
January 17, 2000. However, there will not be any additional payment if the
Merger is completed prior to November 18, 1999.
Completion of the Merger is subject to, among other things:
o approval of the Merger Agreement at our 1999 annual meeting of
stockholders by the holders of at least a majority of the outstanding
common stock;
o receipt of financing for the transaction as provided in the Merger
Agreement;
o receipt of consents to the Merger from the holders of a majority of
our outstanding senior subordinated notes;
o the special committee of Knoll's board of directors shall not have
withdrawn its recommendation that:
o the Merger is fair to and in the best interest of Knoll's public
stockholders, and
o Knoll's board of directors approve the Merger Agreement;
o there shall have been no material adverse change in the business,
assets, liabilities, results of operations or financial condition of
Knoll since December 31, 1998, except as set forth in Knoll's SEC
filings; and
o holders of not more than 10% of the issued and outstanding shares of
common stock shall have exercised their rights of dissent from the
Merger under the Delaware General Corporation Law.
Warburg and certain members of management, who together own a majority of
the outstanding shares of common stock, have agreed to vote their shares in
favor of the Merger. Accordingly, approval of the Merger by our stockholders is
assured. In addition, we have received a commitment from Bank of America, N.A.,
The Chase Manhattan Bank and Merrill Lynch & Co. to provide, subject to certain
conditions, the financing necessary to complete the Merger. We also have entered
into an agreement with the holder of a majority of our outstanding senior
subordinated notes. Under this agreement, the holder consented to the Merger,
and Knoll agreed to pay the holder (and the other holders of such notes who
similarly consent), promptly after completion of the Merger, $120 per $1,000
principal amount of the notes owned by such holder. We currently expect to
complete the Merger in October 1999.
On June 21, 1999, we also announced that we had entered into a Memorandum
of Understanding with counsel to the plaintiffs in the stockholder lawsuits
arising in connection with the proposed Merger. The Memorandum of Understanding
provides for the settlement of these lawsuits based on the payment of a per
share merger consideration of $28.00 and is subject to, among other things,
completion of definitive documentation relating to the settlement, court
approval and completion of the Merger. Since settlement of the stockholder
lawsuits is a condition to the receipt of financing under the financing
commitments we have received, it is effectively a condition to the closing of
the Merger as well.
2
<PAGE>
Under the Merger Agreement, the shares of common stock owned by the selling
stockholders upon completion of the Merger will remain outstanding and will not
be converted into the right to receive the merger consideration. Accordingly, in
order to liquidate a portion of their interests in Knoll, the selling
stockholders may sell the shares offered under this prospectus prior to the
Merger. As noted above, if the Merger is completed, any such shares that you
purchase from the selling stockholders will be converted into the right to
receive the merger consideration.
If the Merger is completed, our common stock will cease to be listed on the
New York Stock Exchange and will be deregistered under the Securities Exchange
Act.
RISK FACTORS
Before you invest in our securities, you should be aware of various risks,
including those described below. You should carefully consider these risk
factors together with all other information included or incorporated in this
prospectus before you decide to invest in the common stock.
In particular, we believe that the likelihood of the closing of the Merger
is the most significant factor affecting the market price of the common stock as
of the date of this prospectus. If the Merger is completed, each stockholder
will receive the merger consideration of $28.00 per share but will not have the
ability to benefit from any future appreciation in the value of the common
stock. However, if the Merger is not completed for any reason, the market price
of the common stock will be more likely to reflect the other risks of ownership
of the common stock, including those described below. Moreover, although we
believe completion of the Merger is likely, the market price of the common stock
may decrease substantially if we do not close the Merger for any reason or if
the closing is postponed or delayed for a significant period of time.
The market value of the common stock is strongly affected by the pendency
of the Merger.
As described above, we intend to complete the Merger, in which our public
stockholders would receive $28.00 per share. If the Merger is not completed
prior to November 18, 1999, the merger consideration of $28.00 per share will be
increased at an annual rate of 6.5% from November 18, 1999 until the earlier of
the completion of the Merger or January 17, 2000. However, there will not be any
additional payment if the Merger is completed prior to November 18, 1999. The
Merger is currently expected to close in October 1999.
We believe that completion of the Merger is likely because, among other
things, Warburg and certain members of our management own a majority of the
common stock and have informed us that they intend to vote in favor of adopting
the Merger Agreement, we have received written financing commitments with
respect to the Merger and we have received the consent to the Merger from the
holder of a majority of our outstanding senior subordinated notes. If the Merger
is completed, you will receive the merger consideration of $28.00 per share
(plus the additional payment, if any, described above), but you will not have
the opportunity to share in Knoll's future earnings and growth.
However, as completion of the Merger remains subject to various conditions,
we cannot assure you that the Merger will be completed. The merger consideration
represents a premium of approximately 84% over the $15.25 closing market price
of the common stock on March 23, 1999, the last full trading day before we
announced we had received the initial merger proposal from Warburg and
management. If the Merger is not completed for any reason or if it is
significantly delayed, the
3
<PAGE>
price of the common stock may trade at a level substantially below its current
price. See "Knoll -- Recent Developments -- Merger Agreement."
Competition in the furniture industry may affect our ability to grow and to
conduct our business profitably.
The office furniture industry is highly competitive, with a significant
number of competitors offering similar products. Many of our competitors,
especially those in North America, are large and have significantly greater
financial, marketing, manufacturing and technical resources than we do.
Our most significant competitors in our primary markets are:
o Steelcase Inc.,
o Herman Miller, Inc.,
o Haworth, Inc. and
o HON INDUSTRIES Inc.
These competitors have a substantial volume of furniture installed at
businesses throughout the country. This installed base of furniture provides
these competitors with a continual source of demand for further products and
enhancements. Moreover, the products of these competitors have strong acceptance
in the marketplace. It is also possible that our competitors will develop
alternative product designs that could give them a competitive advantage over
us.
We also face significant price competition from our competitors and may
encounter competition from new market entrants. We cannot assure you that we
will be able to compete successfully in our markets in the future.
Our efforts to grow our business face many challenges.
We are seeking to increase our sales and market share by introducing new
products and products for new category segments where our current market share
is relatively low. We cannot assure you that our new products will achieve the
same degree of success as that achieved historically by our products.
Additionally, we cannot assure you that we will be able to replicate our
historical success in the office systems category in markets for other furniture
products, such as tables, seating and storage.
Our strategy for introducing new products involves continuing our practice
of aligning with independent architects and designers who are able to design
high quality products consistent with our image. It is possible that we may fail
to create successful relationships with independent architects and designers
with whom we desire to form relationships or that these relationships may fail
to produce designs of sufficient quality that achieve consumer acceptance.
The introduction of new products requires the coordination of the design,
manufacturing and marketing of these products. Our success in these areas may be
adversely affected by factors beyond our control. For example, new product lines
may involve materials, processes and equipment with which we are not experienced
or are less experienced. Accordingly, we may launch a particular
4
<PAGE>
product later than we originally anticipated, which could have an adverse effect
on the success of the product.
Further, our growth strategy depends in part on our ability to increase our
production volume on a timely basis while maintaining product quality.
Manufacturers often encounter difficulties in increasing production volumes,
including problems involving delays, quality control and shortages of qualified
personnel. We may encounter these or other problems.
Our growth strategy also depends on selling a broader range of products to
existing customers, developing new customers in our existing markets and
expanding into new secondary markets. We may be impeded by factors beyond our
control, including general economic factors and business conditions affecting
these markets or these customers. Moreover, we may encounter difficulties
hiring, developing or training successful sales personnel and dealers. We must
also continue to develop our management information systems.
We have borrowed substantial amounts from creditors and are subject to
restrictive debt covenants.
As of June 30, 1999, we had total consolidated outstanding debt of
approximately $164.2 million. Moreover, we may incur additional indebtedness
from time to time to finance acquisitions or capital expenditures or for other
purposes.
Our indebtedness could have important consequences to holders of the common
stock, because:
o a portion of our cash flow from operations must be dedicated to fund
scheduled payments of principal and debt service and will not be
available for other purposes;
o our ability to obtain additional debt financing in the future for
working capital, capital expenditures, research and development or
acquisitions may be restricted; and
o our level of indebtedness could limit our flexibility to react to
changes in the office furniture industry or in economic conditions
generally.
Additionally, the terms of our revolving credit facility and senior
subordinated notes impose certain operating and financial restrictions on us.
These restrictions may limit our ability to respond to changing business and
economic conditions and to secure additional financing, if needed. We might also
be prevented from engaging in transactions to further our growth or other
transactions we consider beneficial. A breach of any of these restrictions could
result in a default under our revolving credit facility or the indenture
relating to the senior subordinated notes, thereby resulting in the acceleration
of payments under the obligations. If payments to the lenders under the
revolving credit facility or payments to the holders of the notes were to be
accelerated, it is possible that our assets would not be sufficient to repay our
indebtedness in full.
We depend on key personnel.
Our operations are dependent, to a significant extent, on the continued
efforts of certain of our executive officers, including Burton B. Staniar, our
Chairman, John H. Lynch, our President and Chief Executive Officer, and Kathleen
G. Bradley and Andrew B. Cogan, our Executive Vice Presidents. Knoll has entered
into one-year employment agreements with Messrs. Staniar, Lynch and
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Cogan, subject to automatic one-year extensions unless Knoll or the employee
gives 60 days notice not to renew. These agreements contain one-year
non-competition provisions.
If these executives become unable to continue in their present role, or if
we are unable to attract and retain other skilled employees, our business could
be materially adversely affected.
We rely on our dealers but generally only have short term commitments from
them.
We rely, to some extent, on a network of independent dealers to market our
products to customers. Our dealers currently operate primarily under one-year
non-exclusive agreements. It is possible that our dealers will choose to end
their relationships with us. If they do so, we may not be able to replace them
satisfactorily.
In addition, consolidation of the office furniture distribution industry
has altered our dealer relationships. We have ended some relationships with
dealers that have been purchased by a consolidator or who carry the products of
our major competitors. Because we have a preference for locally owned
entrepreneurial dealers that offer primarily Knoll products, we may terminate
additional dealers that do not satisfy this preference in the future. The loss
of certain dealers or the termination of dealer relationships could result in
disputes or hinder the way we market and distribute our products.
Knoll is controlled by Warburg and management.
Warburg and our directors, officers and other management employees
beneficially own approximately 60% of the common stock. As a result, these
stockholders have the power to elect our Board of Directors and take other
corporate actions requiring stockholder approval, as well as to dictate our
corporate direction and policies.
In addition, under a stockholders agreement, Warburg and other stockholders
who together own approximately 60% of the common stock have agreed to vote their
shares for four directors designated by Warburg if Warburg owns 50% or more of
the common stock, three directors if it owns 25% or more, two directors if it
owns 15% or more and one director if it owns 5% or more. Since Warburg owns more
than 50% of the common stock, it is entitled under the stockholders agreement to
nominate four Board members. Accordingly, Warburg has the ability to
substantially influence any corporate action requiring Board approval.
In addition, Messrs. Staniar and Lynch have employment agreements which
provide that they will be appointed to the Board of Directors during the
duration of their employment.
In addition, we cannot assure you that in any transfer of a controlling
interest in Knoll any other holders of common stock will be allowed to
participate in any such transaction or will realize any premium with respect to
their shares. These factors may discourage or prevent certain types of
transactions involving an actual or potential change of control.
We rely on patents and other intellectual property.
We own numerous United States and foreign patents, trademarks and service
marks in order to protect certain of our innovations and designs. In addition,
we possess a wide array of unpatented proprietary know-how and common law
trademarks and service marks. Our ability to compete
6
<PAGE>
effectively with other companies depends, to a significant extent, on our
ability to maintain the proprietary nature of our intellectual property.
However, we may not be sufficiently protected by the claims of our various
patents, trademarks and service marks. Additionally, we may not receive the
pending or contemplated patents, trademarks or service marks for which we have
applied or filed. Our business could be materially adversely affected if we were
unable to maintain the proprietary nature of our intellectual property with
respect to its significant current or proposed products or if our products are
determined to infringe the rights of others.
Additionally, our existing patents, trademarks or service marks may be
challenged, invalidated, canceled, narrowed or circumvented. It is also not
certain that the rights we have been granted will provide significant
proprietary protection or competitive advantages.
In the past, certain of our products have been copied and sold by others.
We try to vigorously enforce our intellectual property rights. However, we
cannot assure you that the copying and sale of our products by others would not
materially adversely affect the sale of our products.
The "year 2000" risk may adversely affect us.
The inability of existing computers used by us and others to recognize and
properly process data as the year 2000 approaches may cause many computer
software applications to fail or reach erroneous results. We have assessed
potential issues for us that may result from the year 2000 problem and are in
the process of replacing our existing North American manufacturing and business
information systems with a new system, which we believe to be year 2000
compliant. We are also taking actions to address issues related to embedded
chips in our manufacturing equipment that may not be year 2000 compliant.
Although we anticipate that the project will be completed during the third
quarter of 1999, we cannot assure you that this will occur. We have experienced
and expect to continue to experience operational issues related to the project
implementation. We are developing and will continue to develop plans to address
these issues as they arise.
In the event we are unable to complete the implementation of the project on
a timely basis, our ability to take customer orders, manufacture and deliver
products on a timely basis, invoice customers and collect payments may be
impaired. We cannot reasonably estimate at this time the amount of lost revenue
or additional expenses that might be expected if this occurs. Failure to
implement the project on a timely basis could have a material adverse effect on
us.
Additionally, the year 2000 readiness of our vendors, dealers and other
third parties (such as utility companies, the U.S. government and customers) on
which we rely could impact our operations. Any failure by us or our vendors,
dealers and other third parties to correct a material year 2000 problem in a
timely manner could result in an interruption in, or a failure of, certain of
our business operations. We have not yet adopted a year 2000 contingency plan.
We may have material environmental liabilities.
We are subject to extensive and changing federal, state, local and foreign
environmental laws and regulations as a result of both our past and present
business operations and the past and present ownership and operation of our
manufacturing plants and real property. These laws and regulations include those
relating to discharges to air, water and land, the handling and disposal of
solid and
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<PAGE>
hazardous waste and the cleanup of properties affected by hazardous substances.
We cannot predict what environmental legislation or regulations will be enacted
in the future, how existing or future laws or regulations will be administered
or interpreted or what environmental conditions may be found to exist. We may
have to spend material amounts to comply with more stringent laws or regulations
that may be enacted, or with a stricter interpretation of existing laws. We may
also have potential environmental liabilities of which we are currently unaware.
We are involved from time to time in administrative and judicial
proceedings and inquiries relating to environmental matters, and it is possible
that an administrative judicial proceeding could impose fines, remedial payments
or other costs on us. We have been identified as a potentially responsible party
pursuant to the Comprehensive Environmental Response Compensation and Liability
Act ("CERCLA") for remediation costs associated with waste disposal sites we may
have previously used. CERCLA imposes liability without regard to fault or the
legality of the disposal. The remediation costs at these CERCLA sites are
unknown, but we do not expect any liability we may have under CERCLA to be
material, based on the information currently known to us.
We may experience labor disruptions.
Some of our employees in Grand Rapids, Michigan and in Italy are
represented by unions. While we believe that relations with these unions are
positive, we may encounter difficulties administering our current union
contracts or in negotiating new contracts. In addition, we have experienced
brief work stoppages from time to time at our facilities in Italy as a result of
national and local issues. Although these work stoppages to date have not had a
material effect on us, we may experience further work stoppages, which
individually or in the aggregate could have a material adverse effect on us.
We may be affected by exchange rate fluctuations.
Our foreign sales and certain expenses are transacted in foreign
currencies. In 1998, approximately 9.6% of our revenues and 27.3% of our
expenses were denominated in currencies other than U.S. dollars. Our production
costs, profit margins and competitive position are affected by the strength of
the currencies in countries where we manufacture or purchase goods relative to
the strength of the currencies in countries where our products are sold.
We periodically review our foreign currency exposure and evaluate whether
we should enter into hedging transactions. We generally do not hedge our foreign
currency exposure and may determine not to do so in the future. Therefore, we
presently are, and may continue to be, vulnerable to the effects of currency
exchange rate fluctuations.
The office furniture industry is affected by numerous economic factors and
by quarterly fluctuations.
Fluctuations in office furniture industry revenues may be driven by a
variety of macroeconomic factors, such as white-collar employment levels and
corporate cash flows. Office furniture industry revenues are also affected by
factors such as corporate reengineering and restructuring, technology demands,
ergonomic, health and safety concerns and corporate relocations. Current or
future economic or industry trends may adversely affect our business.
8
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In addition, in certain years we have experienced variability in our sales
from quarter to quarter.
The large amount of shares eligible for future sale or registration could
have an adverse effect on the market price of the common stock.
Sales of a substantial number of shares of common stock in the public
market or the perception that such sales could occur could adversely affect
prevailing market prices for the common stock. As of August 9, 1999, we had
outstanding 39,667,596 shares of common stock, excluding 1,073,703 shares of
common stock which have been granted under our stock incentive plans but have
not vested. Of the shares outstanding, approximately 17.3 million shares of
common stock, including the 1,384,858 shares offered pursuant to this
prospectus, will be freely tradable without restriction under the Securities Act
of 1933, as amended (the "Securities Act"), except for any such shares which may
have been acquired by an "affiliate" of Knoll.
The remaining shares (approximately 22.4 million) will be eligible for sale
in the public market subject to compliance with the volume limitations and other
restrictions of Rule 144 under the Securities Act. In addition, we have filed
registration statements under the Securities Act covering the sale of an
aggregate of 3,055,772 shares of common stock reserved for issuance or sale
under our stock incentive plans, retirement savings plan and employee stock
purchase plan.
Additionally, there are outstanding options to purchase a total of
2,283,848 shares of common stock, of which options to purchase 422,398 shares of
common stock are currently vested and exercisable.
We have granted all the selling stockholders and certain other members of
management registration rights with respect to all of the shares of common stock
held by them prior to our initial public offering, whether vested or unvested.
We may also provide for the registration of shares of common stock held or
acquired in the future by employees pursuant to compensation arrangements,
thereby permitting such shares to be sold in the public market from time to
time. The sale of such shares could have an adverse effect on the market price
of the common stock and on our ability to raise equity capital in the public
markets.
We have not paid dividends on our common stock and are restricted under our
debt instruments from doing so.
The indenture relating to our senior subordinated notes and our revolving
credit facility restrict, among other things, our ability to pay dividends. We
have not paid dividends on our common stock since our initial public offering in
May 1997. We do not anticipate paying any cash dividends on the common stock in
the foreseeable future.
Anti-takeover provisions in our charter and Delaware law could adversely
affect the market price of our securities.
Our certificate of incorporation authorizes the issuance of preferred stock
without stockholder approval. The Board is authorized to determine the terms of
any preferred stock we may issue. If we were to issue preferred stock, the
issuance could make it more difficult for a third party to acquire Knoll. This
might discourage third parties from acquiring or proposing to acquire
significant amounts of the common stock and could adversely affect the
prevailing market price of the common stock.
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<PAGE>
The rights of holders of common stock will be subject to, and may be
adversely affected by, the rights of holders of any preferred stock that we may
issue in the future.
In addition, under certain circumstances, Section 203 of the Delaware
General Corporation Law makes it more difficult for an "interested stockholder"
(generally a 15% stockholder) to effect various business combinations with a
corporation for a three-year period.
FORWARD-LOOKING INFORMATION
This prospectus includes "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. The Act provides a "safe
harbor" for forward-looking statements to encourage companies to provide
prospective information about themselves so long as they identify these
statements as forward-looking and provide meaningful cautionary statements
identifying important factors that could cause actual results to differ from
their anticipated results. All statements other than statements of historical
fact we make in this prospectus or in any document incorporated by reference are
forward-looking. In particular, our statements regarding the completion of the
Merger, industry prospects and our future results of operations or financial
position are forward-looking statements. Forward-looking statements reflect our
current expectations and are inherently uncertain. Our actual results may differ
significantly from our expectations. The section entitled "Risk Factors"
describes some, but not all, of the factors that could cause these differences.
USE OF PROCEEDS
We will not receive any proceeds from the sale of the shares. All proceeds
will be received by the selling stockholders. See "Selling Stockholders."
10
<PAGE>
SELLING STOCKHOLDERS
The following table provides certain information with respect to the common
stock beneficially owned by the selling stockholders as of August 9, 1999, and
the number of shares offered hereunder. Because the selling stockholders may
offer some or all of the shares in an offering that is not underwritten on a
firm commitment basis, no estimate can be given as to the number of shares that
will be held by any selling stockholder after completion of the offering. See
"Plan Of Distribution." To the extent required, the specific number of shares to
be sold, the name of the selling stockholder effecting such sale, the names of
any agent, dealer or underwriter participating in such sale, and any applicable
commission or discount with respect to the sale will be set forth in a
supplement to this prospectus. The nature of the positions, offices or other
material relationships that certain selling stockholders have had with Knoll or
any of our predecessors or affiliates within the past three years are set forth
in documents incorporated herein by reference. The shares offered by means of
this prospectus may be offered from time to time by the selling stockholders
named below:
<TABLE>
<CAPTION>
Shares Beneficially Number of Shares Beneficially
Owned Prior to the Shares Offered Owned After the
Selling Stockholders Offering(1) Offering(1) Percent
- ------------------------------------- --------------------- --------------- ---------------------- --------------
<S> <C> <C> <C> <C>
Burton B. Staniar 1,063,744 492,688 571,056 1.4%
John H. Lynch 720,896 358,635 362,261 *
Kathleen G. Bradley 200,919 171,284 29,635 *
Andrew B. Cogan 237,584 110,809 126,775 *
Douglas J. Purdom 220,491 146,745 73,746 *
Other selling stockholders (2) 132,843 104,697 28,146 *
- ------------------
* Less than 1%.
(1) Each named person is deemed to be the beneficial owner of securities that may be acquired within 60 days
through the exercise of options, warrants or other rights, if any. These exclude shares and/or options
granted to the selling stockholders under Knoll's stock incentive plans that have not yet vested and will
not vest within 60 days.
(2) Comprised of three Knoll executives who, in the aggregate, beneficially owned less than 1% of the outstanding
shares of common stock prior to the offering.
</TABLE>
11
<PAGE>
PLAN OF DISTRIBUTION
We are registering the shares on behalf of the selling stockholders and
their successors (including donees and pledgees, who may sell shares they
receive from the selling stockholders after the date of this prospectus). The
selling stockholders or their successors may sell all of the shares from time to
time in transactions involving cross or block trades or otherwise on the
over-the-counter market through Nasdaq, or on one or more other securities
markets and exchanges, in privately negotiated transactions or through writing
options or engaging in other hedging transactions with respect to the shares.
They may also sell their shares in accordance with Rule 144 under the Securities
Act. They may sell the shares at fixed prices that may change, at market prices
prevailing at the time of sale, at prices relating to prevailing market prices
or at negotiated prices. The selling stockholders may sell the shares to or
through broker-dealers (whether acting as agents or brokers, or acting as
principals). These broker-dealers may receive compensation in the form of
discounts, concessions or commissions from the selling stockholders and/or the
purchasers (which compensation may be in excess of customary commissions).
The selling stockholders have advised us that they have not entered into
any agreements, understandings or arrangements for the sale of the shares with
any underwriters or broker-dealers and that no underwriter or coordinating
broker is now acting in connection with the proposed sale of shares. We will not
receive any proceeds from the sale of the shares by the selling stockholders. We
may suspend use of this prospectus under certain circumstances.
The selling stockholders and broker-dealers who assist in the sale of the
shares may be "underwriters" within the meaning of Section 2(11) of the
Securities Act. Any commissions or profit they earn on any resale of the shares
may be underwriting discounts and commissions under the Securities Act. Selling
stockholders who are "underwriters" within the meaning of Section 2(11) of the
Securities Act will be subject to the prospectus delivery requirements of the
Securities Act. Under the rules and regulations of the Securities Exchange Act,
any person engaged in a distribution of the shares may be limited in its ability
to engage in market activities with respect to such shares. In addition, each
selling stockholder will be subject to applicable provisions of the Exchange Act
and the rules and regulations thereunder, which provisions may limit the timing
of purchases and sales of any of the shares by the selling stockholders. The
foregoing may affect the marketability of the shares.
We will pay all expenses (other than selling commissions and fees and stock
transfer taxes) of the registration and sale of the shares. We also have agreed
to indemnify the selling stockholders and broker-dealers who assist in the sale
of the shares against certain liabilities, including liabilities under the
Securities Act. The selling stockholders may indemnify any agent, dealer or
broker-dealer that assists them in selling the shares against certain
liabilities, including liabilities arising under the Securities Act.
We cannot guarantee that the selling stockholders will sell any or all of
the shares.
12
<PAGE>
GENERAL INFORMATION
Underwriters, dealers and agents that participate in the distribution of
the offered securities may be underwriters as defined in the Securities Act, and
any discounts or commissions they receive from us and any profit on the resale
of the offered securities by them may be treated as underwriting discounts and
commissions under the Securities Act. To the extent required, any underwriters
or agents will be identified and their compensation described in a prospectus
supplement.
We may have agreements with the underwriters, dealers and agents to
indemnify them against certain civil liabilities, including liabilities under
the Securities Act, or to contribute with respect to payments which the
underwriters, dealers or agents may be required to make.
Underwriters, dealers and agents may engage in transactions with, or
perform services for, us or our subsidiaries in the ordinary course of their
businesses.
LEGAL OPINIONS
The validity of the shares of common stock offered by this prospectus will
be passed upon for Knoll by Willkie Farr & Gallagher, New York, New York.
EXPERTS
The consolidated financial statements and schedule of Knoll, Inc. and The
Knoll Group, Inc. (Predecessor) appearing in Knoll's Annual Report on Form 10-K
for the year ended December 31, 1998 have been audited by Ernst & Young LLP,
independent auditors, as set forth in their report thereon included therein and
incorporated herein by reference. Such consolidated financial statements and
schedule are incorporated herein in reliance upon such report given on the
authority of such firm as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We have filed a registration statement of which this prospectus forms a
part. The registration statement, including the attached exhibits, contains
additional information about our common stock. The rules and regulations of the
SEC allow us to omit some of the information included in the registration
statement from this prospectus.
In addition, we file annual, quarterly and special reports, proxy
statements and other information with the SEC. Our SEC filings are available to
the public over the Internet at the SEC's web site at http://www.sec.gov. You
may also read and copy any document we file at the SEC's public reference rooms
in Washington, D.C., New York, New York and Chicago, Illinois. Please call the
SEC at 1-800-SEC-0330 for further information on the public reference rooms. Our
SEC filings are also available at the offices of The New York Stock Exchange, in
New York, New York.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
an important part of this prospectus, and information that we file later with
the SEC will automatically update and supersede this information. We incorporate
by
13
<PAGE>
reference our documents listed below and any future filings we make with the SEC
under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934
until the selling stockholders sell all of the shares.
o Annual Report on Form 10-K, as amended by the Annual Report on Form
10-K/A for the year ended December 31, 1998;
o Quarterly Reports on Form 10-Q for the quarters ended March 31, 1999
and June 30, 1999;
o Current Reports on Form 8-K, filed March 24, 1999 and June 22, 1999;
and
o The description of our common stock set forth in our registration
statement filed under the Securities Exchange Act on Form 8-A on May
6, 1997, including any amendment or report for the purpose of updating
such description.
You may request a copy of these filings at no cost, by writing or
telephoning us at the following address:
Knoll, Inc.
Investor Relations
1235 Water Street
East Greenville, Pennsylvania 18041
(215) 679-7991
14
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. Other Expenses of Issuance and Distribution.
The estimated expenses, other than underwriting discounts and commissions,
in connection with the offerings of the shares are set forth below. Such
expenses will be borne by Knoll.
Securities Act Registration Fee................ $10,191
"Blue Sky" Fees and Expenses................... 0
Printing and Engraving Expenses................ 5,000
Legal Fees and Expenses........................ 75,000
Accounting Fees and Expenses................... 30,000
Miscellaneous.................................. 4,809
-----------
Total...................................... $ 125,000
===========
- ---------------
* Estimated and subject to future contingencies.
ITEM 15. Indemnification of Directors and Officers.
Knoll, which is a Delaware corporation, is empowered by the Delaware
General Corporation Law, subject to the procedures and limitations stated
therein, to indemnify any person against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by such person in connection with any threatened, pending or completed action,
suit or proceeding in which such person is made a party by reason of his or her
being or having been a director, officer, employee or agent of Knoll. The
statute provides that indemnification pursuant to its provisions is not
exclusive of other rights of indemnification to which a person may be entitled
under any by-law, agreement, vote of stockholders or disinterested directors, or
otherwise. Knoll's certificate of incorporation and by-laws provide for
indemnification of the directors and officers to the full extent permitted by
the Delaware General Corporation Law.
Article Nine of Knoll's certificate of incorporation provides as follows:
NINTH: 1. Indemnification. The Corporation shall indemnify to the fullest
extent permitted under and in accordance with the laws of the State of Delaware
any person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or in the
right of the Corporation) by reason of the fact that he is or was a director,
officer, incorporator, employee or agent of the Corporation, or is or was
serving at the request of the Corporation as a director, officer, trustee,
employee or agent of or in any other similar capacity with another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the Corporation, and, with respect
to any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful. The termination of any action, suit or proceeding by
judgment, order, settlement, conviction, or upon a plea of nolo contendere or
its
II-1
<PAGE>
equivalent, shall not, of itself, create a presumption that the person did not
act in good faith and in a manner which he reasonably believed to be in, or not
opposed to, the best interests of the Corporation, and, with respect to any
criminal action or proceeding, shall not, of itself, create a presumption that
the person had reasonable cause to believe that his conduct was unlawful.
2. Payment of Expenses. Expenses (including attorneys' fees) incurred in
defending any civil, criminal, administrative or investigative action, suit or
proceeding shall (in the case of any action, suit or proceeding against a
director of the Corporation) or may (in the case of any action, suit or
proceeding against an officer, trustee, employee or agent) be paid by the
Corporation in advance of the final disposition of such action, suit or
proceeding as authorized by the Board of Directors upon receipt of an
undertaking by or on behalf of the indemnified person to repay such amount if it
shall ultimately be determined that he is not entitled to be indemnified by the
Corporation as authorized in this Article NINTH.
3. Nonexclusivity of Provision. The indemnification and other rights set
forth in this Article NINTH shall not be exclusive of any provisions with
respect thereto in the by-laws or any other contract or agreement between the
Corporation and any officer, director, employee or agent of the Corporation.
4. Effect of Repeal. Neither the amendment nor repeal of this Article
NINTH, subparagraph 1, 2, or 3, nor the adoption of any provision of this
Certificate of Incorporation inconsistent with this Article NINTH, subparagraph
1, 2, or 3, shall eliminate or reduce the effect of this Article NINTH,
subparagraphs 1, 2, and 3, in respect of any matter occurring before such
amendment, repeal or adoption of an inconsistent provision or in respect of any
cause of action, suit or claim relating to any such matter which would have
given rise to a right of indemnification or right to receive expenses pursuant
to this Article NINTH, subparagraph 1, 2, or 3, if such provision had not been
so amended or repealed or if a provision inconsistent therewith had not been so
adopted.
5. Limitation on Liability. No director or officer shall be personally
liable to the Corporation or any stockholder for monetary damages for breach of
fiduciary duty as a director or officer, except for any matter in respect of
which such director or officer (A) shall be liable under Section 174 of the
General Corporation Law of the State of Delaware or any amendment thereto or
successor provision thereto, or (B) shall be liable by reason that, in addition
to any and all other requirements for liability, he:
(i) shall have breached his duty of loyalty to the Corporation or its
stockholders;
(ii) shall not have acted in good faith or, in failing to act, shall not
have acted in good faith;
(iii) shall have acted in a manner involving intentional misconduct or a
knowing violation of law or, in failing to act, shall have acted in a manner
involving intentional misconduct or a knowing violation of law; or
(iv) shall have derived an improper personal benefit.
If the General Corporation Law of the State of Delaware is amended after
the date hereof to authorize corporate action further eliminating or limiting
the personal liability of directors, then the liability of a director of the
Corporation shall be eliminated or limited to the fullest extent permitted by
the General Corporation Law of the State of Delaware, as so amended. Knoll
maintains an insurance
II-2
<PAGE>
policy providing for indemnification of its officers, directors and certain
other persons against liabilities and expenses incurred by any of them in
certain stated proceedings and under certain stated conditions. In addition,
Knoll's employment agreements with Burton B. Staniar, John H. Lynch and Andrew
B. Cogan provide that if during and after the term of such officers' employment
the executive is made a party or compelled to participate in any action by
reason of the fact that he is or was a director or officer of Knoll, the
executive will be indemnified by Knoll to the fullest extent permitted by
Delaware general corporation law or authorized by Knoll's certificate of
incorporation or by-laws or resolutions.
ITEM 16. Exhibits.
2 -- Amended and Restated Agreement and Plan of Merger, dated as of July
29, 1999, by and between Warburg, Pincus Ventures, L.P. and Knoll,
Inc. (incorporated by reference from the Preliminary Proxy Statement
on Schedule 14A, filed with the SEC on July 30, 1999).
5 -- Opinion of Willkie Farr & Gallagher
23.1 -- Consent of Ernst & Young LLP
23.2 -- Consent of Willkie Farr & Gallagher (included in Exhibit 5)
24 -- Power of Attorney (included on the signature pages hereto)
ITEM 17. Undertakings.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the
effective registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this registration statement or any
material change to such information in the registration statement;
provided, however, that subparagraphs (i) and (ii) do not apply if the
registration statement is on Form S-3 or S-8, and the information required
to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by the registrant pursuant to Section
13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in this registration statement.
II-3
<PAGE>
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
The undersigned registrant hereby further undertakes that, for the purposes
of determining any liability under the Securities Act of 1933, each filing of
the registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in this
registration statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described under Item 15 of this
registration statement, or otherwise (other than insurance), the registrant has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in such Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person, in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in such Act and will be governed by the final adjudication
of such issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in East Greenville, Pennsylvania, on August 13, 1999.
KNOLL, INC.
By: /s/ BURTON B. STANIAR
------------------------------
Name: Burton B. Staniar
Title: Chairman of the Board
POWER OF ATTORNEY
The undersigned officers and directors of Knoll, Inc., hereby severally
constitute and appoint Douglas J. Purdom, Patrick A. Milberger and Kewsong Lee,
and each of them, attorneys-in-fact for the undersigned, in any and all
capacities, with the power of substitution, to sign any amendments to this
registration statement (including post-effective amendments) and any subsequent
registration statement for the same offering which may be filed under Rule
462(b) under the Securities Act of 1933, as amended, and to file the same with
exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact, and
each of them, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the premises, as fully and
to all interests and purposes as he might or could do in person, hereby
ratifying and confirming all that each said attorney-in-fact, or his substitute
or substitutes, may do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons, in the
capacities and on the dates indicated:
Name Title Date
- ---- ----- ----
/s/ BURTON B. STANIAR Chairman of the Board August 13, 1999
- -------------------------
Burton B. Staniar
/s/ JOHN H. LYNCH President, Chief Executive August 13, 1999
- ------------------------- Officer and Director
John H. Lynch (Principal Executive Officer)
II-5
<PAGE>
Name Title Date
- ---- ----- ----
/s/ DOUGLAS J. PURDOM Chief Financial Officer August 13, 1999
- ------------------------- (Principal Financial Officer)
Douglas J. Purdom
/s/ BARRY L. MCCABE Controller August 13, 1999
- ------------------------- (Principal Accounting Officer)
Barry L. McCabe
/s/ JOHN W. AMERMAN Director August 13, 1999
- -------------------------
John W. Amerman
/s/ ANDREW B. COGAN Director August 13, 1999
- -------------------------
Andrew B. Cogan
/s/ ROBERT J. DOLAN Director August 13, 1999
- -------------------------
Robert J. Dolan
/s/ JEFFREY A. HARRIS Director August 13, 1999
- -------------------------
Jeffrey A. Harris
/s/ SIDNEY LAPIDUS Director August 13, 1999
- -------------------------
Sidney Lapidus
/s/ KEWSONG LEE Director August 13, 1999
- -------------------------
Kewsong Lee
/s/ HENRY B. SCHACHT Director August 13, 1999
- -------------------------
Henry B. Schacht
II-6
<PAGE>
August 13, 1999
Knoll, Inc.
1235 Water Street
East Greenville, Pennsylvania 18041
Ladies and Gentlemen:
We have acted as counsel to Knoll, Inc. (the "Company"), a corporation organized
under the laws of the State of Delaware, in connection with the preparation of a
Registration Statement on Form S-3 (Registration No. 333-______) (the
"Registration Statement") relating to the offer and sale (the "Offering") of up
to 1,384,858 shares of the Company's common stock, par value $.01 per share (the
"Shares"), by the selling stockholders described therein.
We have examined copies of the Amended and Restated Certificate of Incorporation
and By-Laws of the Company, the Registration Statement, resolutions adopted by
the Company's Board of Directors and other records and documents that we have
deemed necessary for the purpose of this opinion. We have also examined such
other documents, papers, statutes and authorities as we have deemed necessary to
form a basis for the opinions hereinafter expressed.
In our examination, we have assumed the genuineness of all signatures and the
conformity to original documents of all copies submitted to us. As to various
questions of fact material to our opinion, we have relied on statements and
certificates of officers and representatives of the Company and public
officials.
Based on the foregoing, we are of the opinion that: (1) the Company has been
duly organized and is validly existing as a corporation in good standing under
the laws of the State of Delaware; and (2) the Shares are duly authorized,
validly issued, fully paid and nonassessable.
We are members of the bar of the State of New York, and we express no opinion as
to the laws of any jurisdiction other than the General Corporation Law of the
State of Delaware.
<PAGE>
Knoll, Inc.
August 13, 1999
Page 2
This opinion is limited to matters expressly set forth herein, and no opinion is
to be implied or may be inferred beyond the matters expressly stated herein. The
opinions expressed herein are rendered as of the date hereof, and we undertake
no obligation to advise you of any change in any matters set forth herein
subsequent to the date hereof.
Except as set forth below, this opinion is for your use only and, without our
prior written consent, this opinion may not be furnished or quoted to, or relied
upon by, any other person or entity for any purpose. We hereby consent to the
filing of this opinion as an exhibit to the Registration Statement and to the
reference to us under the caption "Legal Matters" in the prospectus included as
part of the Registration Statement. In giving this consent, we do not thereby
admit that we are within the category of persons whose consent is required under
Section 7 of the Securities Act of 1933, as amended, or the rules and
regulations of the Securities and Exchange Commission promulgated thereunder.
Very truly yours,
/s/ Willkie Farr & Gallagher
<PAGE>
EXHIBIT 23.1
------------
Consent of Independent Auditors
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3 No. 333-_____) and related Prospectus of Knoll,
Inc. for the registration of 1,384,858 shares of its common stock and to the
incorporation by reference therein of our report dated January 29, 1999 (except
for Note 20, as to which the date is February 10, 1999, and Notes 21 and 25, as
to which the date is March 24, 1999), with respect to the consolidated financial
statements and schedule of Knoll, Inc. included in its Annual Report (Form 10-K)
for the year ended December 31, 1998, filed with the Securities and Exchange
Commission.
/s/ Ernst & Young LLP
Philadelphia, Pennsylvania
August 12, 1999
