UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2001
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _________ to _________
Commission File No. 001-12907
KNOLL, INC.
A Delaware Corporation I.R.S. Employer No. 13-3873847
1235 Water Street
East Greenville, PA 18041
Telephone Number (215) 679-7991
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes [X] No [ ]
As of August 6, 2001, there were 23,188,829 shares of the Registrant's common
stock, par value $0.01 per share, outstanding.
KNOLL, INC.
TABLE OF CONTENTS FOR FORM 10-Q
Item Page
- ---- ----
PART I -- FINANCIAL INFORMATION
1. Condensed Consolidated Financial Statements (Unaudited):
Condensed Consolidated Balance Sheets at June 30, 2001
and December 31, 2000........................................... 3
Condensed Consolidated Statements of Operations for the three months
and six months ended June 30, 2001 and 2000..................... 4
Condensed Consolidated Statements of Cash Flows for the six months
ended June 30, 2001 and 2000.................................... 5
Notes to the Condensed Consolidated Financial Statements............. 6
2. Management's Discussion and Analysis of Financial Condition and Results
of Operations........................................................ 8
3. Quantitative and Qualitative Disclosures about Market Risk............... 10
PART II -- OTHER INFORMATION
2. Changes in Securities and Use of Proceeds................................ 11
6. Exhibits and Reports on Form 8-K......................................... 11
Signatures ................................................................. 12
2
PART I -- FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements (Unaudited)
- ----------------------------------------------------------------
KNOLL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars In Thousands, Except Per Share Data)
June 30, 2001 December 31, 2000
------------- -----------------
ASSETS
Current assets:
Cash and cash equivalents .................................... $ 26,787 $ 22,339
Customer receivables, net .................................... 120,878 132,183
Inventories .................................................. 71,500 79,203
Deferred income taxes ........................................ 18,076 22,236
Prepaid and other current assets ............................. 6,256 7,421
--------- ---------
Total current assets .................................... 243,497 263,382
Property, plant and equipment .................................... 302,018 298,828
Accumulated depreciation ......................................... (129,213) (119,199)
--------- ---------
Property, plant and equipment, net ...................... 172,805 179,629
Intangible assets ................................................ 280,450 280,724
Accumulated amortization ......................................... (38,950) (34,845)
--------- ---------
Intangible assets, net .................................. 241,500 245,879
Other noncurrent assets .......................................... 5,986 6,240
--------- ---------
Total Assets ............................................ $ 663,788 $ 695,130
========= =========
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Current maturities of long-term debt ......................... $ 43,750 $ 31,250
Accounts payable ............................................. 75,887 85,795
Income taxes payable ......................................... 3,974 5,668
Other current liabilities .................................... 82,271 107,991
--------- ---------
Total current liabilities ............................... 205,882 230,704
Dividend payable ................................................. -- 220,339
Long-term debt ................................................... 561,488 394,505
Deferred income taxes ............................................ 23,863 24,675
Other noncurrent liabilities ..................................... 32,978 29,282
--------- ---------
Total liabilities ....................................... 824,211 899,505
--------- ---------
Stockholders' deficit:
Common stock, $0.01 par value; 100,000,000 shares
authorized; 23,189,829 shares issued and outstanding
(net of 16,300 treasury shares) in 2001 and 23,193,629
shares issued and outstanding (net of 12,500 treasury
shares) in 2000 ........................................... 232 232
Additional paid-in-capital ................................... 3,464 3,591
Unearned stock grant compensation ............................ -- (2)
Retained deficit ............................................. (149,777) (195,379)
Accumulated other comprehensive loss ......................... (14,342) (12,817)
--------- ---------
Total stockholders' deficit ............................. (160,423) (204,375)
--------- ---------
Total Liabilities and Stockholders' Deficit ............. $ 663,788 $ 695,130
========= =========
See accompanying notes.
3
KNOLL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In Thousands)
Three Months Ended Six Months Ended
June 30, June 30,
---------------------- ----------------------
2001 2000 2001 2000
-------- -------- -------- --------
Sales .............................. $261,102 $315,374 $514,227 $584,208
Cost of sales ...................... 155,805 182,937 308,198 343,588
-------- -------- -------- --------
Gross profit ....................... 105,297 132,437 206,029 240,620
Selling, general and administrative
expenses ........................ 53,237 61,753 103,889 116,970
-------- -------- -------- --------
Operating income ................... 52,060 70,684 102,140 123,650
Interest expense ................... 10,864 11,718 23,021 24,195
Other income (expense), net ........ (1,571) 1,126 (1,615) 1,562
-------- -------- -------- --------
Income before income tax expense ... 39,625 60,092 77,504 101,017
Income tax expense ................. 16,135 24,174 31,902 40,933
-------- -------- -------- --------
Net income ......................... $ 23,490 $ 35,918 $ 45,602 $ 60,084
======== ======== ======== ========
See accompanying notes.
4
KNOLL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In Thousands)
Six Months Ended
June 30,
----------------------------
2001 2000
---------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income ................................................... $ 45,602 $ 60,084
Adjustments to reconcile net income to cash provided by
operating activities:
Depreciation and amortization .......................... 18,348 18,024
Other noncash items .................................... 2,348 118
Changes in assets and liabilities:
Customer receivables ............................... 11,123 12,539
Inventories ........................................ 7,391 (3,438)
Accounts payable ................................... (9,687) 10,256
Current and deferred income taxes .................. 2,767 8,553
Other current assets and liabilities ............... (25,624) 7,002
Other noncurrent assets and liabilities ............ 1,534 (3,135)
--------- --------
Cash provided by operating activities ........................ 53,802 110,003
--------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures ......................................... (8,144) (8,119)
Proceeds from sale of assets ................................. 57 92
--------- --------
Cash used in investing activities ............................ (8,087) (8,027)
--------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from (repayment of) revolving credit
facilities, net ........................................... 192,000 (91,718)
Repayment of long-term debt .................................. (12,500) (7,500)
Payment of dividend .......................................... (220,339) --
Purchase of common stock ..................................... (128) (162)
Payment of recapitalization costs ............................ -- (230)
--------- --------
Cash used in financing activities ............................ (40,967) (99,610)
--------- --------
Effect of exchange rate changes on cash and cash
equivalents ............................................... (300) (957)
--------- --------
Increase in cash and cash equivalents ........................ 4,448 1,409
Cash and cash equivalents at beginning of period ............. 22,339 10,785
--------- --------
Cash and cash equivalents at end of period ................... $ 26,787 $ 12,194
========= ========
See accompanying notes.
5
KNOLL, INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2001
(Unaudited)
1. Basis of Presentation
The accompanying unaudited condensed consolidated financial statements of Knoll,
Inc. (the "Company" or "Knoll") have been prepared in accordance with generally
accepted accounting principles for interim financial information and with the
instructions to Form 10-Q and Article 10 of Regulation S-X and therefore do not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation are reflected in the condensed consolidated
financial statements. The condensed consolidated balance sheet as of December
31, 2000 is derived from the Company's 2000 audited balance sheet. The unaudited
condensed consolidated financial statements and notes thereto should be read in
conjunction with the consolidated financial statements and notes thereto
contained in the Company's annual report on Form 10-K for the year ended
December 31, 2000. The results of operations for the three months and six months
ended June 30, 2001 are not necessarily indicative of the results to be expected
for the full year ending December 31, 2001 or other future periods.
2. Dividend
On December 20, 2000, the Company's Board of Directors declared a special cash
dividend of $9.50 per share of common stock, or $220.3 million in the aggregate,
payable on January 5, 2001 to stockholders of record as of the close of business
on December 20, 2000. The payment of the dividend on January 5, 2001 was funded
with borrowings under the Company's senior revolving credit facility.
3. Derivative Instruments and Hedging Activities
The Company adopted Statement of Financial Accounting Standards No. 133,
"Accounting for Derivative Instruments and Hedging Activities," as amended
("SFAS 133"), on January 1, 2001. The adoption of SFAS 133 did not have a
material effect on the earnings or financial position of the Company.
On the date a derivative instrument is entered into, the Company designates the
derivative as (i) a fair value hedge, (ii) a cash flow hedge, (iii) a hedge of a
net investment in a foreign operation or (iv) a risk management instrument not
eligible for hedge accounting. The Company recognizes all derivatives on the
balance sheet at fair value. All derivatives in which the Company was engaged as
of January 1, 2001 and June 30, 2001 and during the six months then ended, which
include interest rate collar agreements and foreign currency forward exchange
contracts, were classified as risk management instruments not eligible for hedge
accounting. Changes in the fair value of derivatives classified as risk
management instruments not eligible for hedge accounting are reported in
earnings in the period the value of the contract changes. The net amount paid or
received upon quarterly settlements for interest rate collar agreements and the
net gain or loss incurred upon settlement of foreign currency forward exchange
contracts are recorded as an adjustment to interest expense and cost of sales,
respectively, while the remaining change in fair value is recorded as a
component of other income (expense).
The Company uses interest rate collar agreements to manage its exposure to
fluctuations in interest rates on its variable rate debt. At December 31, 2000,
the Company had three interest rate collar agreements outstanding with an
aggregate notional principal amount of $135.0 million, related weighted average
maximum and minimum rates of 10.00% and 5.64%, respectively, and a termination
date of February 2003. In February 2001, the Company negotiated modifications to
these agreements that increased the aggregate notional principal amount to
$200.0 million, decreased the weighted average minimum rate to 5.12% and
extended the termination date to February 2004. The aggregate fair value of such
interest rate collar agreements as of June 30, 2001 was $3.1 million, which
6
was recorded as a liability in the Company's condensed consolidated balance
sheet. The aggregate net loss related to these agreements was $0.1 million and
$3.1 million for the three months and six months ended June 30, 2001,
respectively, and was recorded as a component of other expense.
From time to time, the Company enters into foreign currency forward exchange
contracts and foreign currency option contracts to manage its exposure to
foreign exchange rates associated with purchases of inventory from foreign
suppliers. The terms of these contracts are generally less than a year. The
aggregate fair value as of June 30, 2001 as well as the aggregate net gain for
the six months ended June 30, 2001 related to the Company's foreign currency
forward exchange contracts was not material.
4. Adjustments to Stock Options
In February 2001, the Stock Option Committee of the Board of Directors approved
certain adjustments to outstanding stock options in response to dilution created
by the special cash dividend paid on January 5, 2001. The adjustments included
increasing the number of shares of common stock under option from 3,706,445 to
4,383,968, lowering the range of exercise prices from $15.93 - $33.13 to $13.47
- - $28.01 and increasing the number of options available for future grants from
1,076,584 to 1,273,382. All vesting and term provisions of each award remain
unchanged. No compensation expense was recognized in connection with the
adjustments since (i) the adjustments were executed in response to an equity
restructuring and (ii) the modifications to the awards did not increase the
aggregate intrinsic value of each award and did not reduce the per share ratio
of the exercise price to the market value.
5. Inventories
June 30, 2001 December 31, 2000
------------- -----------------
(In Thousands)
Raw materials ...................... $41,698 $50,626
Work in process .................... 8,036 8,633
Finished goods ..................... 21,766 19,944
------- -------
Inventories ........................ $71,500 $79,203
======= =======
6. Comprehensive Income
For the three months ended June 30, 2001 and 2000, total comprehensive income
amounted to $25.2 million and $33.7 million, respectively. Total comprehensive
income for the six months ended June 30, 2001 and 2000 was $44.1 million and
$56.7 million, respectively.
7. Recently Issued Accounting Pronouncements
In June 2001, the Financial Accounting Standards Board ("FASB") approved the
issuance of Statements of Financial Accounting Standards No. 141, "Business
Combinations" ("SFAS 141"), and No. 142, "Goodwill and Other Intangibles" ("SFAS
142"). SFAS 141 eliminates the pooling-of-interests method of accounting for
business combinations and changes the criteria to recognize intangible assets
apart from goodwill. SFAS 142 prescribes that goodwill and certain other
intangible assets should no longer be amortized to earnings, but instead should
be reviewed for impairment on at least an annual basis. With respect to
intangible assets recorded as of June 30, 2001, the Company is required to adopt
SFAS 141 and SFAS 142 on January 1, 2002. Knoll has not yet determined what the
effect of these statements will be on the earnings and financial position of the
Company.
7
Item 2. Management's Discussion and Analysis of Financial Condition and Results
- --------------------------------------------------------------------------------
of Operations
-----------------------------------------------------------------------
The following discussion should be read in conjunction with the accompanying
unaudited condensed consolidated financial statements and notes thereto and in
conjunction with the Company's annual report on Form 10-K for the year ended
December 31, 2000.
Overview
2001 is shaping up to be the most challenging year the United States office
furniture industry has faced in the last thirty years. A reduction in business
confidence, corporate profitability and white-collar employment growth in
response to a general softening in the economy in North America have directly
affected sales of office furniture. The economic slowdown in North America has
led to a significant reduction in sales volume in 2001 compared to 2000 and an
extremely competitive pricing environment within the industry.
Despite the current economic slowdown, the Company continues to invest
aggressively in the development of new products and other sales and marketing
initiatives designed to gain market share. At NeoCon 2001, a contract furniture
trade show held annually in June, the Company introduced many new products,
including the A3(TM) office system, the Crinion Collection(TM) and two seating
offerings, as well as enhancements to each of its existing office system product
lines. The Company also continues to pursue and implement technological
initiatives designed to streamline its order entry process and provide customers
with readily accessible product information tailored specifically to their
individual demands. The Company believes that its continued focus on the above
initiatives will enable Knoll to be well positioned to meet the needs of its
customers as macroeconomic conditions improve.
Results of Operations
Comparison of Second Quarter and Six Months Ended June 30, 2001 to Second
Quarter and Six Months Ended June 30, 2000
Sales. Sales for the second quarter of 2001 were $261.1 million, a decrease of
17.2%, or $54.3 million, from the Company's highest ever quarterly sales of
$315.4 million achieved in the second quarter of 2000. Sales for the six months
ended June 30, 2001 were $514.2 million, a decrease of 12.0%, or $70.0 million,
from sales of $584.2 million for the same period of 2000. Sales in the second
quarter and six months of 2001 were down primarily as a result of decreased
volume attributable to the economic slowdown. The decreases in the Company's
second quarter and six month 2001 sales were also due, to a lesser extent, to
competitive pricing pressures that have been experienced in connection with the
economic slowdown. The Company believes that current economic conditions will
persist through the remainder of 2001, and therefore expects to experience a
decline in sales for the full year of 2001 as compared to 2000.
Gross Profit and Operating Income. In anticipation of lower sales volume in the
second quarter and six months of 2001, the Company took steps intended to
prevent significant deterioration of profits as a percentage of sales by
aggressively managing certain discretionary and factory costs. As a percentage
of sales, gross profit was 40.3% and 40.1% for the second quarter and six months
ended June 30, 2001, respectively, and 42.0% and 41.2% for the second quarter
and six months ended June 30, 2000, respectively. Operating income as a
percentage of sales was 19.9% for both the second quarter and six months ended
June 30, 2001 and 22.4% and 21.2% for the second quarter and six months ended
June 30, 2000, respectively. The decreases in the gross profit and operating
income percentages from 2000 to 2001 are due primarily to lower sales volume
allowing less absorption of fixed overhead costs in the second quarter and six
months ended June 30, 2001 compared to the same periods of 2000. As economic
conditions are not expected to improve through the remainder of this year, the
Company expects to continue with its efforts to aggressively manage certain
discretionary and factory costs.
Interest Expense. Despite higher outstanding debt balances in the second quarter
and six months ended June 30, 2001 compared to the same periods of 2000, the
Company's interest expense decreased $0.8 million quarter-over-quarter and $1.2
million six months-over-six months as a result of lower interest rates on
variable-rate debt during 2001. Interest rates incurred for borrowings under the
Company's credit facilities during the second quarter and six months ended June
30, 2001 were more favorable due to the improvement of the Company's leverage
ratio since December 31, 1999 and lower short-term borrowing rates in response
to actions taken by the United States Federal Reserve to lower the federal funds
rate in 2001.
8
Income Tax Expense. The Company's effective tax rate is directly affected by
changes in consolidated pretax income and the mix of pretax income and varying
effective tax rates attributable to the countries in which it operates. The mix
of pretax income was primarily responsible for the change in the effective tax
rate to 40.7% for the second quarter of 2001 from 40.2% for the second quarter
of 2000 and to 41.2% for the six months ended June 30, 2001 from 40.5% for the
same period of 2000.
Liquidity and Capital Resources
During the six months ended June 30, 2001, the Company generated cash flow from
operations of $53.8 million. Cash provided by operations resulted primarily from
earnings before depreciation, amortization and other noncash charges offset by
cash used for working capital purposes. A substantial portion of cash used for
working capital purposes related to the payment, in the first quarter of 2001,
of December 31, 2000 accruals of employee costs associated with year 2000
performance.
The $53.8 million of cash flow provided by operations in addition to $192.0
million of net borrowings under the senior revolving credit facility were used
during the six months ended June 30, 2001 to fund capital expenditures of $8.1
million, repay $12.5 million of debt under the term loan facility and fund the
payment of a special cash dividend totaling $220.3 million, or $9.50 per share
of common stock. Such dividend was declared by the Company on December 20, 2000
and was payable on January 5, 2001 to stockholders of record as of the close of
business on December 20, 2000.
As of June 30, 2001, the Company had an aggregate of $124.0 million available
for borrowing under its U.S. and European revolving credit facilities. The
Company believes that existing cash balances and internally generated cash
flows, together with borrowings available under its revolving credit facilities,
will be sufficient to fund normal working capital needs, capital spending
requirements and debt service requirements for at least the next twelve months.
The Company's debt instruments contain certain covenants that, among other
things, limit the Company's ability to incur additional indebtedness, pay
dividends and purchase Company stock as well as require the Company to maintain
certain financial ratios.
Recently Issued Accounting Pronouncements
In June 2001, the FASB approved the issuance of SFAS 141 and SFAS 142. SFAS 141
eliminates the pooling-of-interests method of accounting for business
combinations and changes the criteria to recognize intangible assets apart from
goodwill. SFAS 142 prescribes that goodwill and certain other intangible assets
should no longer be amortized to earnings, but instead should be reviewed for
impairment on at least an annual basis. With respect to intangible assets
recorded as of June 30, 2001, the Company is required to adopt SFAS 141 and SFAS
142 on January 1, 2002. Knoll has not yet determined what the effect of these
statements will be on the earnings and financial position of the Company.
Statement Regarding Forward-Looking Disclosure
Certain portions of this Form 10-Q, including "Management's Discussion and
Analysis of Financial Condition and Results of Operations," contain various
forward-looking statements within the meaning of Section 27A of the Securities
Act and Section 21E of the Exchange Act that represent the Company's
expectations or beliefs concerning future events. Forward-looking statements
relate to future operations, strategies, financial results or other developments
and are not based on historical information. In particular, statements using
verbs such as "anticipates," "believes," "estimates," "expects" or words of
similar meaning generally involve forward-looking statements. Although the
Company believes the expectations reflected in these forward-looking statements
are based upon reasonable assumptions, no assurance can be given that Knoll will
attain these expectations or that any deviations will not be material. Readers
of this Form 10-Q are cautioned not to unduly rely on any forward-looking
statements.
The Company cautions that its forward-looking statements are further qualified
by important factors that could cause actual results to differ materially from
those in the forward-looking statements. Such factors include, without
limitation, the impact of the continuing downturn in the North American economy
generally and in the high-technology industry; further fluctuations in industry
revenues driven by a variety of macroeconomic factors, including white-collar
employment levels, business confidence and corporate profitability and cash
flows, as well as
9
by a variety of industry factors such as corporate reengineering and
restructuring, technology demands, ergonomic, health and safety concerns and
corporate relocations; competitive pricing within the contract office furniture
industry; the Company's indebtedness, which requires a significant portion of
the Company's cash flow from operations to be dedicated to debt service, making
such cash flow unavailable for other purposes, and which could limit the
Company's flexibility in reacting to changes in its industry or economic
conditions generally; the highly competitive nature of the market in which the
Company competes, including the introduction of new products, pricing changes by
the Company's competitors and growth rates of the office systems category; risks
associated with the Company's growth strategy, including the risk that the
Company's introduction of new products will not achieve the same degree of
success achieved historically by the Company's products; the Company's
dependence on key personnel; the ability of the Company to maintain its
relationships with its dealers; the Company's reliance on its patents and other
intellectual property; environmental laws and regulations, including those that
may be enacted in the future, that affect the ownership and operation of the
Company's manufacturing plants; risks relating to potential labor disruptions;
risks associated with conducting business via the Internet and the Company's
ability to react appropriately and in a timely fashion to changing technologies
and business models; and fluctuations in foreign currency exchange rates. Except
as otherwise required by the federal securities laws, the Company disclaims any
obligation or undertaking to disseminate any updates or revisions to any
forward-looking statement contained in this Form 10-Q to reflect any change in
its expectations with regard thereto or any change in events, conditions or
circumstances on which any such statement is based.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
- -------------------------------------------------------------------
During the normal course of business, the Company is routinely subjected to
market risk associated with interest rate movements and foreign currency
exchange rate movements. Interest rate risk arises from the Company's debt
obligations and related interest rate collar agreements. Foreign currency
exchange rate risk arises from the Company's foreign operations and purchases of
inventory from foreign suppliers. There have been no material changes in the
carrying amounts or fair values of the Company's financial instruments or its
exposure to market risk since December 31, 2000 except as described below.
The Company had $497.3 million of variable rate debt outstanding at June 30,
2001, which is an increase of $179.5 million from December 31, 2000. Such
increase is related to net borrowings of $192.0 million under the senior
revolving credit facility, which includes borrowings to fund the payment of a
special cash dividend totaling $220.3 million on January 5, 2001, offset by the
repayment of $12.5 million of debt under the term loan facility. The fair value
of the Company's variable rate debt continues to approximate its carrying
amount.
As previously disclosed in the Company's annual report on Form 10-K for the year
ended December 31, 2000, in February 2001, the Company negotiated modifications
to its interest rate collar agreements that existed at December 31, 2000. Such
modifications included increasing the aggregate notional principal amount from
$135.0 million to $200.0 million, decreasing the weighted average minimum rate
from 5.64% to 5.12% and extending the termination date from February 2003 to
February 2004. The aggregate fair value of the modified agreements from the
Company's perspective changed to ($3.1) million at June 30, 2001. This fair
value has been recognized as a liability in the Company's condensed consolidated
balance sheet as of June 30, 2001. In addition, the Company recognized an
aggregate net loss related to the interest rate collar agreements of $0.1
million and $3.1 million as a component of other expense in the condensed
consolidated statements of operations for the three months and six months ended
June 30, 2001, respectively.
10
PART II -- OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds
- --------------------------------------------------
Restrictions on Dividends
The credit agreement governing the Company's credit facilities and the indenture
relating to the Company's 10.875% Senior Subordinated Notes due 2006 contain
certain covenants that, among other things, limit the Company's ability to
purchase Knoll stock and pay dividends to its stockholders. On December 20,
2000, the Company's Board of Directors declared a special cash dividend of $9.50
per share of common stock (approximately $220.3 million in the aggregate)
payable on January 5, 2001 to stockholders of record as of the close of business
on December 20, 2000. Such dividend was in compliance with the covenants
contained in the aforementioned debt agreements, as amended. Prior to December
20, 2000, the Company had never declared any dividends on its common stock. Any
future determination to pay dividends will depend on the Company's results of
operations, financial condition, capital requirements, contractual restrictions
and other factors deemed relevant by the Board of Directors.
Item 6. Exhibits and Reports on Form 8-K
- -----------------------------------------
a. Exhibits:
None.
b. Current Reports on Form 8-K:
The Company did not file any reports on Form 8-K during the three months
ended June 30, 2001.
11
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
KNOLL, INC.
Date: August 13, 2001 By: /s/ Burton B. Staniar
----------------------------------
Burton B. Staniar
Chairman of the Board
Date: August 13, 2001 By: /s/ Barry L. McCabe
----------------------------------
Barry L. McCabe
Senior Vice President,
Treasurer and Controller
(Principal Accounting Officer)
12