Item 1.01 Entry into a Material Definitive Agreement.
On October 28, 2021, Laureate Education, Inc. (the "Company") entered into
Amendment No. 1 (the "Amendment") to the Amended and Restated Securityholders
Agreement, dated as of February 6, 2017, among Wengen Alberta, Limited
Partnership ("Wengen"), the Company and the other parties thereto (the
"Securityholders Agreement").
The Amendment provides, among other matters, that for so long as either Kohlberg
Kravis Roberts & Co. L.P. (together with its affiliates, "KKR") or Cohen Private
Ventures, LLC (together with its affiliates, "CPV") holds at least 8,035,713
shares of Company common stock, KKR and CPV collectively (or one of them if the
other has lost its director designation right under the Securityholders
Agreement) will have the right to nominate one additional director (the "Third
Director") who will initially be Ian K. Snow, and who may be removed or replaced
at any time without cause by KKR and CPV (or one of them if the other has lost
its existing director designation right under the Securityholders Agreement). In
the event that KKR and CPV each ceases to be the beneficial owner of at least
8,035,713 shares of Company common stock, then the Third Director must offer his
resignation as a director to the Company's Board of Directors, and KKR and CPV
thereafter will no longer be entitled to designate a Third Director. In
addition, irrespective of their actual holdings, the right to designate a Third
Director, as well as the existing Company director designation rights of KKR,
CPV and Sterling Capital Partners II, L.P., Sterling Capital Partners III, L.P.,
SP L Affiliate, LLC, Douglas L. Becker, Steven M. Taslitz and their respective
affiliates under the Securityholders Agreement, will expire on December 31,
2024.
Also, in the Amendment Wengen and the Wengen investors agree that, as between
them and the Company, Wengen and such investors will be responsible for the
payment of any taxes and any related fees, costs and expenses attributable to a
direct or indirect transfer of Company common stock and that Wengen and the
Wengen investors will, at the time of any such transfer, pay to, or as directed
by, the Company or Wengen (and the Company and Wengen have the right to withhold
from any amounts distributable to Wengen or the Wengen investors) the amount of
any taxes payable in Peru with respect to such transfer and any related costs,
fees and expenses incurred by the Company, any of the Company's subsidiaries or
Wengen. Wengen will pay any amounts it so receives from the Wengen investors to
the Company, and the Company will use any amounts it so receives from Wengen and
the Wengen investors (and any amounts so withheld) to pay any taxes payable in
Peru and its related costs, fees and expenses.
Item 8.01 Other Events.
Also on October 28, 2021, certain investors in Wengen elected to have their
interests in Wengen redeemed in exchange for delivery by Wengen to such
investors of the number of shares of Company common stock corresponding to the
Wengen interests so redeemed.
Because the Company Class B common stock outstanding after giving effect to the
redemption represented less than 15% of the total outstanding Class A common
stock and Company Class B common stock, pursuant to the Company's certificate of
incorporation each share of Company Class A common stock and each share of
Company Class B common stock automatically converted into one share of common
stock of the Company, effective October 29, 2021. Following the conversion, the
Company has only one class of common stock outstanding, and the Company no
longer qualifies for the "controlled company" exemption under the Nasdaq rules.
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