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Except as described below, we are not aware of any legal proceedings that we believe could have, individually or in the aggregate, a material adverse effect on our business, results of operations or financial condition.
−Removed: On December 6, 2019, the Occupational Safety and Health Administration of the U.S.
−Removed: Department of Labor (“OSHA”) dismissed a complaint made by Michael S.
−Removed: Ryan, the former chief accounting officer of the Company, alleging retaliatory employment practices in violation of the whistleblower provisions of the Sarbanes-Oxley Act ( Michael S.
−Removed: Laureate Education, Inc., Case No.
−Removed: 3-0050-17-011 ).
−Removed: On January 2, 2020, Mr.
−Removed: Ryan filed Objections to the Secretary’s Findings, and Request for Hearing Before an Administrative Law Judge (the “Objections and Request for Hearing”) with the Chief Administrative Law Judge and a hearing has been set for September, 2020.
−Removed: Ryan’s complaint to OSHA, which was filed on November 16, 2016, also alleges a lack of compliance with U.S.
−Removed: GAAP and violations of certain SEC rules and regulations.
−Removed: The complaint does not seek any specified amount of damages.
−Removed: The Company has investigated the allegations made in the complaint with the assistance of outside legal and accounting advisers and believes that its consolidated financial statements are in compliance with U.S.
−Removed: GAAP and SEC rules and regulations in all material respects and that the allegations are baseless and without merit.
−Removed: The Company currently is assessing its response to the Objections and Request for Hearing.
−Removed: The Company intends to continue to defend itself vigorously.
+Added: On November 25, 2020, the Company and Michael S.
+Added: Ryan, the former chief accounting officer of the Company, settled all outstanding claims with respect to Mr.
+Added: Ryan’s objections to the dismissal of his 2016 complaint to the Occupational Safety and Health Administration of the U.S.
+Added: Department of Labor alleging a lack of compliance with U.S.
+Added: GAAP and certain SEC rules and regulations by the Company.
+Added: Such settlement did not involve a material amount nor any admission of wrongdoing by either party.
During 2010, we were notified by the Spanish Taxing Authorities (“STA”) (in this case, by the Regional Inspection Office of the Special Madrid Tax Unit) that an audit of some of our Spanish subsidiaries was being initiated for 2006 and 2007.
−Removed: On June 29, 2012, the STA issued a final assessment to Iniciativas Culturales de España, S.L.
−Removed: (“ICE”), our Spanish holding company, for approximately EUR 11.1 million ( $12.3 million at December 31, 2019), including interest, for those two years based on its rejection of the tax deductibility of financial expenses related to certain intercompany acquisitions and the application of the Spanish ETVE regime.
+Added: On June 29, 2012, the STA issued a final assessment to Laureate Netherlands Holding B.V.
+Added: (f/k/a Iniciativas Culturales de España, S.L.) (“ICE”), our Spanish holding company, for approximately EUR 11.1 million ($13.5 million at December 31, 2020), including interest, for those two years based on its rejection of the tax deductibility of financial expenses related to certain intercompany acquisitions and the application of the Spanish ETVE regime.
On July 25, 2012, we filed a claim with the Regional Economic-Administrative Court challenging this assessment, and, in the same month, we issued a cash-collateralized letter of credit for the assessment amount, in order to suspend the payment of the tax due.
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On October 19, 2015, the STA issued a final assessment to ICE for approximately EUR 17.2 million ($21.0 million at December 31, 2020), including interest, for those three years.
−Removed: appealed this assessment and, in order to suspend the payment of the tax assessment until the court decision, we issued a cash-collateralized letter of credit for the assessment amount plus interest and surcharges.
+Added: We have appealed this assessment, and, in order to suspend the payment of the tax assessment until the court decision, we issued a cash-collateralized letter of credit for the assessment amount plus interest and surcharges.
We believe that the assessments in this case are without merit and intend to defend vigorously against them.
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The payments were made using cash that collateralized the letters of credit discussed above.
−Removed: In October of 2018, the STA issued a final assessment to our Spanish holding company for the 2011 through 2013 period of approximately EUR 4.1 million ( $4.5 million at December 31, 2019).
+Added: In October of 2018, the STA issued
+Added: a final assessment to our Spanish holding company for the 2011 through 2013 period of approximately EUR 4.1 million ($5.0 million at December 31, 2020).
As of December 31, 2020, the Company has posted a cash-collateralized letter of credit of approximately $5.5 million for the assessment, plus a surcharge.
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ICE received the final assessment on January 27, 2020, in which the STA rejected the allegation writ submitted by ICE and confirmed the assessment issued by the tax audit, amounting to approximately EUR 4.3 million ($5.3 million at December 31, 2020).
−Removed: ICE intends to appeal the referred assessment before the Administrative Central Court but, in order to be able to submit the appeal, ICE must issue a guarantee to cover the referred assessment.
+Added: ICE intends to appeal the referred assessment before the Administrative Central Court, and, in order to do so, ICE has posted a cash-collateralized letter of credit of approximately EUR 4.3 million ($5.3 million at December 31, 2020).
Finally, the referred tax audit was extended in June 2019 to the non-resident income tax for the second semester of fiscal year 2015.
−Removed: This audit is still in progress and the entity has not yet received any estimative assessment.
−Removed: On June 10, 2019, the Supreme People’s Court affirmed the judgment of the Higher Court of Hunan Province in favor of current and former Laureate affiliates and dismissed an appeal filed by Mr.
−Removed: Zhen Ziban, an heir of Chen Zhengxian, a minority shareholder in our former network institution in China, Hunan International Economics University (“HIEU”).
−Removed: Zheng had had six months to apply to the Supreme People’s Court for a retrial of the case.
−Removed: Zheng failed to apply within the prescribed timeframe to the Supreme People’s Court of the People’s Republic of China (the “Supreme People’s Court”) for a retrial of the case commenced by Mr.
−Removed: Chen against LEI Lie Ying Limited and Steven Lin (a former Laureate employee) seeking return of a capital contribution of RMB 172 million and for loss of interest of RMB 28 million or the distribution of dividends in an equivalent amount.
−Removed: Accordingly, we believe that this matter is resolved.
−Removed: On June 10, 2019, the Supreme People’s Court affirmed the judgment of the Higher Court of Hunan Province in favor of current and former Laureate affiliates and dismissed an appeal filed by Guangdong Nanbo Education Investment Co Ltd.
−Removed: Guangdong Nanbo Education Investment Co Ltd.
−Removed: had six months to apply to the Supreme People’s Court for a retrial of the case.
−Removed: Guangdong Nanbo Education Investment Co Ltd., a minority shareholder in the HIEU group, failed to apply within the prescribed timeframe to the Supreme People’s Court for a retrial of the case commenced by such entity against LEI Lie Ying Limited (as majority shareholder) and Laureate Shanghai alleging the invalidity of service agreements entered into between HIEU and Laureate Shanghai and the infringement by LEI Lie Ying Limited of HIEU’s interests, and seeking the repayment of RMB 265 million in fees paid under those agreements.
−Removed: Accordingly, we believe that this matter is resolved.
−Removed: On September 11, 2019, the People’s Court of Tianxin District, Changsha City, in the People’s Republic of China issued a Notice of Assistance in Enforcement addressed to Lei Lie Ying Limited, a private limited company formerly indirectly owned by us (“LEILY”), and HIEU requesting that (i) Zhang Jianbo and Chen Zhengxiani’s alleged rights in certain land owned by HIEU be frozen, (ii) such land be disposed of instead pursuant to the terms of a series of agreements allegedly entered into in 2009 and (iii) the proceeds thereof be deposited with the court pending final resolution of the dispute.
−Removed: Under the agreements entered into for the sale of our interest in LEILY, we are required to defend this action and to indemnify the purchaser against any liabilities which arise from these claims, subject to an aggregate cap on liability of RMB 400 million (approximately $57 million at December 31, 2019).
−Removed: We believe that the claims are without merit and intend to defend vigorously against them.
+Added: On March 11, 2020, ICE received a preliminary assessment of approximately EUR 21.6 million ($26.4 million at December 31, 2020).
+Added: This assessment is not final, and we intend to challenge the referred assessment before the STA.
Mine Safety Disclosures
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.