EURO CONVERSION

On January 1, 1999, eleven of the fifteen member countries of the European Union established fixed conversion rates between their existing sovereign currencies and the Euro. There will be a transition period from January 1, 1999 through January 1, 2002, at which time all legal tender will convert to the Euro. The Company's primary exposure to the Euro conversion is concentrated in Steelcase Strafor.

In December 1997, Steelcase Strafor created an internal Euro committee, a pan-European multifunctional team whose goal was to determine the impact of this currency change on products, markets, and information systems. At this time, Steelcase Strafor is preparing an implementation of unified price lists for dealers. The aim is to have three commercial zones in Europe within the three-year transition period, but no change is expected in calendar 1999. Steelcase Strafor is adapting and migrating its internal system in order to be Euro compliant by the end of calendar 1999. Steelcase Strafor is also assisting and educating its dealers to become Euro compliant. Training for employees will begin during the transition period. The transition period is anticipated to resolve difficulties in handling local currencies and the Euro simultaneously, while remaining flexible to the market. Steelcase Strafor sees the primary financial impact of the Euro conversion to be potential savings on foreign exchange hedging and commissions. Based on the Euro Committee's work to date, the Company does not expect the Euro conversion to have a material impact on Steelcase Strafor's financial position, or on the Company as a whole.