Apollo Education Group, Inc. (NASDAQ:APOL) Files An 8-K Other Events

Apollo Education Group, Inc. (NASDAQ:APOL) Files An 8-K Other Events

Story continues below

Item8.01 Other Events.

U.S. Department of Education Supplemental Preacquisition
Review Application Response

On December20, 2016, the U.S. Department of Education (the
Department) provided a supplemental response (the Supplemental
DOE Preacquisition Response) to the preacquisition review
application filed by University of Phoenix and Western
International University in connection with our pending merger
(Merger) with AP VIII Queso Holdings, L.P., a Delaware limited
partnership (Queso), as further described in our filings with the
U.S. Securities and Exchange Commission set forth below. The
Supplemental DOE Preacquisition Response modifies and supplements
certain portions of the initial response dated December7, 2016
(the Initial DOE Preacquisition Response), which is described in
and furnished as an exhibit to our Form 8-K filed on December8, 2016.
A copy of the Supplemental DOE Preacquisition Response is
furnished as Exhibit 99.1 to this Form 8-K.

The preacquisition
review application was filed in accordance with Department
procedures to which the Department provides information about
conditions the Department intends to impose in connection with
the continued participation in federal Title IV student financial
aid programs by an applicant following a change in ownership.
Consummation of the Merger is subject to the absence of certain
conditions or restrictions in the Departments response, including
among other conditions, the absence of any requirement to post a
letter of credit in excess of 10% of the amount of Title IV
program funds received by University of Phoenix during fiscal
year 2016 or any limitation (other than certain excluded
limitations) which reasonably would be expected to materially
impair the operation of the Universitys business in the manner in
which it is currently conducted, unless these burdensome
conditions are imposed solely because of certain deficiencies
associated with Queso and its affiliates.

In the
Supplemental DOE Preacquisition Response, the Department modified
the letter of credit conditions to the continued participation of
University of Phoenix and Western International University in
Title IV programs following consummation of the Merger. As
modified, within ten days after the Merger, Queso would be
required to post letters of credit with the Department in the
aggregate amount of $154.3million and establish cash escrow
accounts in the aggregate amount of $231.4million which are
accessible only by the Department on the same conditions as a
draw on the letters of credit, which amounts represent the
Departments calculation of 10% and 15%, respectively, of the
aggregate Title IV program receipts of University of Phoenix and
Western International University in fiscal year 2016. In
addition, Queso must demonstrate that immediately following the
Merger, it has $200million of cash on its balance sheet.

The Supplemental
DOE Preacquisition Response also clarified the manner in which
enrollment, retention and graduation rates will be calculated for
purposes of measuring compliance with certain conditions
specified in the Initial DOE Preacquisition Response.

We have been
informed by Queso that it acknowledges and accepts the mandatory
requirements stipulated in the Initial DOE Preacquisition
Response, as amended and clarified by the Supplemental DOE
Preacquisition Response.

In addition to the
conditions associated with the preacquisition review response,
the Merger is subject to the approval by the Higher Learning
Commission (HLC), the principal accreditor of University of
Phoenix and our other domestically accredited institutions, of
the change of control applications filed by University of
Phoenix, Western International University and The College for
Financial Planning Institutes Corporation. HLC previously
informed us that the HLC Board of Trustees had voted to defer
action on the change of control applications until such time as
the Department of Education provided us and HLC with a written
response to the pre-acquisition review applications filed by
University of Phoenix and Western International University, and a
substantive response to any requirements has been filed.We have
submitted to HLC all of the requested information, including
Quesos written acceptance of the mandatory requirements
stipulated in the Initial DOE Preacquisition Response, as amended
and clarified by the Supplemental DOE Preacquisition Response,
and we anticipate that HLC will take action on our change of
control applications in due course. However, we cannot predict or
control the timing or outcome of HLCs review of our
applications.

Subject to the
satisfaction of all closing conditions, we expect to consummate
the Merger by February1, 2017, the date on which the agreement
governing the Merger becomes terminable by either party. However,
there can be no assurance that all closing conditions will be
satisfied in a timely manner or at all, or that the Merger will
be consummated.

For additional
information about the Merger and the related Merger Agreement,
see the following filings we have made with the Securities and
Exchange Commission:

Current Report on Form 8-K filed February8, 2016;
Definitive Proxy Statement filed March23, 2016;
Supplement to the Definitive Proxy Statement filed May2,
2016;
Amendments to the Merger Agreement attached to our Current
Report on Form 8-K filed May2, 2016;
Current Report on Form 8-K filed July7, 2016;
Annual Report on Form 10-K filed October20, 2016; and
Current Report on Form 8-K filed December8, 2016.

The information in
Item8.01 of this Form 8-K shall not be deemed filed for purposes
of Section18 of the Securities Exchange Act of 1934, as amended
(the Exchange Act), or otherwise subject to the liabilities under
that section, nor shall it be deemed incorporated by reference in
any filing under the Securities Act of 1933, as amended, or the
Exchange Act, regardless of any general incorporation language in
such filing.

Section 9
– Financial Statements and Exhibits

Item 9.01.
Financial Statements and Exhibits.

(d)
Exhibits.

The following
exhibit is furnished herewith:

Exhibit Number

Exhibit Description

99.1 Supplemental preacquisition review response letter dated
December20, 2016 from U.S. Department of Education


About Apollo Education Group, Inc. (NASDAQ:APOL)

Apollo Education Group, Inc. is an education provider. The Company offers undergraduate, graduate, certificate and no degree educational programs and services, online and on-campus, to working adults in the United States and abroad through University of Phoenix, Apollo Global and Others. Its segments include University of Phoenix, Apollo Global and Others. The University of Phoenix is a private university. The Apollo Global segment includes BPP Holdings Limited (BPP), Open Colleges Australia Pty Ltd (Open Colleges), Career Partner GmbH, Universidad Latinoamericana (ULA), Faculdade da Educacional da Lapa (FAEL), Apollo Global Chile S.A. (Apollo Global Chile), Milpark Education (Pty) Ltd. (Milpark Education) and India Education Services Private Ltd (India Education Services). The Others segment includes The College for Financial Planning Institutes Corporation (College for Financial Planning); Western International University, Inc.; TIY Academy, LLC, and Apollo Professional Development.

Apollo Education Group, Inc. (NASDAQ:APOL) Recent Trading Information

Apollo Education Group, Inc. (NASDAQ:APOL) closed its last trading session up +0.02 at 9.94 with 485,941 shares trading hands.

An ad to help with our costs