-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, EY+Fuqc8QUtYy/slIfLvc54QUikrNeRnoP6CiXcwDQs5kht7/jotDkV/s1Z52rW8 8x9/+lVceYPWT72cMWqALA== 0000950172-04-000272.txt : 20040204 0000950172-04-000272.hdr.sgml : 20040204 20040204093446 ACCESSION NUMBER: 0000950172-04-000272 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20040204 GROUP MEMBERS: NEW MOUNTAIN GP, LLC GROUP MEMBERS: NEW MOUNTAIN INVESTMENTS, L.P. GROUP MEMBERS: STEVEN B. KLINSKY SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: STRAYER EDUCATION INC CENTRAL INDEX KEY: 0001013934 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-EDUCATIONAL SERVICES [8200] IRS NUMBER: 521975978 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-48233 FILM NUMBER: 04564854 BUSINESS ADDRESS: STREET 1: 1025 15TH STREET NW CITY: WASHINGTON STATE: DC ZIP: 20005 BUSINESS PHONE: 2024082400 MAIL ADDRESS: STREET 1: 1025 15TH STREET NW CITY: WASHINGTON STATE: DC ZIP: 20005 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: NEW MOUNTAIN PARTNERS LP CENTRAL INDEX KEY: 0001105474 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: C/O STEVEN B KLINKSY STREET 2: 712 FIFTH AVE 23RD FL CITY: NEW YORK STATE: NY ZIP: 10019 BUSINESS PHONE: 2127200300 MAIL ADDRESS: STREET 1: 712 FIFTH AVE STREET 2: 23RD FL CITY: NEW YORK STATE: NY ZIP: 10019 SC 13D/A 1 ny470773.txt SC 13D - AMENDMENT NO. 6 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 ----------------------------------------- SCHEDULE 13D (Rule 13d-101) INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a) (AMENDMENT NO. 6) STRAYER EDUCATION, INC. ----------------------------------------- (Name of Issuer) COMMON STOCK, PAR VALUE $.01 PER SHARE ------------------------------------------ (Title of Class of Securities) 863236105 ------------------------------------------ (CUSIP Number) Steven B. Klinsky New Mountain Partners, L.P. 712 Fifth Avenue, 23rd Floor New York, New York 10019 Telephone: (212) 720-0300 --------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) Copies to: J. Michael Schell Sean C. Doyle Skadden, Arps, Slate, Meagher & Flom LLP Four Times Square New York, New York 10036-6522 Telephone: (212) 735-3000 February 4, 2004 ------------------------------------------------------- (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box [ ]. Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7(b) for other parties to whom copies are to be sent. (Continued on the following pages) CUSIP No. 863236105 13D - ------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSONS: New Mountain Partners, L.P. I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY): 13-4099832 - ------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP [X] (a) [ ] (b) - ------------------------------------------------------------------------------- 3 SEC USE ONLY - ------------------------------------------------------------------------------- 4 SOURCE OF FUNDS: See Items 3 and 4 AF, OO - ------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION: Delaware - ------------------------------------------------------------------------------- 7 SOLE VOTING POWER: None NUMBER OF --------------------------------------------------- SHARES 8 SHARED VOTING POWER: BENEFICIALLY 4,551,879 OWNED BY EACH --------------------------------------------------- REPORTING 9 SOLE DISPOSITIVE POWER: PERSON WITH None --------------------------------------------------- 10 SHARED DISPOSITIVE POWER: 4,551,879 - ------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON: 4,551,879 shares - ------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] - ------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): Approximately 31.86% - ------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON: PN - ------------------------------------------------------------------------------- CUSIP No. 863236105 13D - ------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSONS: New Mountain Investments, L.P. I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY): 13-4099829 - ------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP [X] (a) [ ] (b) - ------------------------------------------------------------------------------- 3 SEC USE ONLY - ------------------------------------------------------------------------------- 4 SOURCE OF FUNDS: AF, OO - ------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION: Delaware - ------------------------------------------------------------------------------- 7 SOLE VOTING POWER: None NUMBER OF --------------------------------------------------- SHARES 8 SHARED VOTING POWER: BENEFICIALLY 4,551,879 OWNED BY EACH --------------------------------------------------- REPORTING 9 SOLE DISPOSITIVE POWER: PERSON WITH None --------------------------------------------------- 10 SHARED DISPOSITIVE POWER: 4,551,879 - ------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON: 4,551,879 - ------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] - ------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): Approximately 31.86% - ------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON: PN - ------------------------------------------------------------------------------- CUSIP No. 863236105 13D - ------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSONS: New Mountain GP, LLC I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY): 13-4099827 - ------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP [X] (a) [ ] (b) - ------------------------------------------------------------------------------- 3 SEC USE ONLY - ------------------------------------------------------------------------------- 4 SOURCE OF FUNDS: AF, OO - ------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION: Delaware - ------------------------------------------------------------------------------- 7 SOLE VOTING POWER: None NUMBER OF -------------------------------------------------- SHARES 8 SHARED VOTING POWER: BENEFICIALLY 4,551,879 OWNED BY EACH -------------------------------------------------- REPORTING 9 SOLE DISPOSITIVE POWER: PERSON WITH None -------------------------------------------------- 10 SHARED DISPOSITIVE POWER: 4,551,879 - ------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON: 4,551,879 - ------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] - ------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): Approximately 31.86% - ------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON: OO - ------------------------------------------------------------------------------- CUSIP No. 863236105 13D - ------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSONS: Steven B. Klinsky I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY): N/A - ------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP [X] (a) [ ] (b) - ------------------------------------------------------------------------------- 3 SEC USE ONLY - ------------------------------------------------------------------------------- 4 SOURCE OF FUNDS: OO, PF - ------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION: United States of America - ------------------------------------------------------------------------------- 7 SOLE VOTING POWER: None NUMBER OF -------------------------------------------------- SHARES 8 SHARED VOTING POWER: BENEFICIALLY 4,551,879 OWNED BY EACH -------------------------------------------------- REPORTING 9 SOLE DISPOSITIVE POWER: PERSON WITH None -------------------------------------------------- 10 SHARED DISPOSITIVE POWER: 4,551,879 - ------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON: 4,551,879 - ------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] - ------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): Approximately 31.86% - ------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON: IN - ------------------------------------------------------------------------------- Amendment No. 6 to Schedule 13D The statement on Schedule 13D (the "Schedule 13D"), as amended by Amendment No. 1 ("Amendment No. 1"), Amendment No. 2 ("Amendment No. 2"), Amendment No. 3 ("Amendment No. 3"), Amendment No. 4 ("Amendment No. 4") and Amendment No. 5 ("Amendment No. 5") thereto, filed jointly on March 26, 2001, May 15, 2001, October 8, 2002, November 18, 2002, November 22, 2002 and January 14, 2004, respectively, by the persons listed on the signature pages thereto relating to the beneficial ownership of the common stock, par value $.01 per share ("Common Stock"), of Strayer Education, Inc., a Maryland corporation (the "Issuer"), and the beneficial ownership of the Series A Preferred Stock, par value $.01 per share ("Series A Preferred Stock"), of the Issuer, which is convertible into Common Stock, is hereby amended and supplemented as set forth below in this Amendment No. 6 to the Schedule 13D by the persons listed on the signature page hereto (the "Reporting Persons"). Capitalized terms used below and not otherwise defined herein shall have the meanings set forth in the Schedule 13D, as amended by Amendment No. 1, Amendment No. 2, Amendment No. 3, Amendment No. 4 and Amendment No. 5. Item 4. Purpose of Transaction. The disclosure in Item 4(a) is hereby amended and supplemented by adding the following: "On February 3, 2004 the Issuer filed a Registration Statement on Form S-3 (the "2004 Registration Statement") relating to an aggregate of 3,450,000 shares of Common Stock beneficially owned by New Mountain, MidOcean and the Trust which may be sold pursuant to an underwritten offering (the "2004 Offering"). The 2004 Registration Statement relates to 1,615,006 shares of Common Stock beneficially owned by New Mountain, 1,000,000 shares of Common Stock beneficially owned by MidOcean, 384,994 shares of Common Stock beneficially owned by the Trust and an aggregate of 450,000 shares of Common Stock that may be purchased by the underwriters to cover over-allotments, if any. Item 5. Interest in Securities of the Issuer. The disclosure in Item 5(a) is hereby amended by deleting the last paragraph of such Item 5(a). Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer. The disclosure in the last paragraph of Item 6 is hereby amended and restated to read in its entirety as follows: "On February 3, 2004, the Issuer, New Mountain and MidOcean entered into a letter agreement (the "February 2004 Letter Agreement") that (i) confirmed the parties' understanding of Section 7 of Article FIRST of the Articles Supplementary regarding the determination of the number of shares of Common Stock issuable in connection with the conversion of Series A Preferred Stock pursuant to the Articles Supplementary, (ii) provided for the Issuer's diligent pursuit of certain Required Approvals (as defined below) and determined the allocation of certain 2004 Offering Expenses (as defined below) among New Mountain and MidOcean and (iii) established certain information rights between New Mountain and the Issuer. This summary of certain provisions of the February 2004 Letter Agreement, other related agreements, other related documents and the transactions contemplated thereby is not intended to be complete, and is qualified in its entirety by reference to such documents. Pursuant to the February 2004 Letter Agreement, the Issuer, New Mountain and MidOcean agreed that, for purposes of determining the number of shares of Common Stock issuable in connection with any conversion of Series A Preferred Stock pursuant to the Articles Supplementary, full credit shall be given for dividends accruing on a daily basis since the most recent Dividend Payment Date (as defined in the Articles Supplementary) preceding the Conversion Date (as defined in the Articles Supplementary) through but excluding the Conversion Date. New Mountain and MidOcean released any claim they may have had for accrued and unpaid dividends in connection with any conversions of Series A Preferred Stock prior to the date of the February 2004 Letter Agreement, including, without limitation, as provided in paragraph 3(c) of the Letter Agreement. Pursuant to the February 2004 Letter Agreement, the Issuer, New Mountain and MidOcean agreed that in connection with the possible sale or other disposition by New Mountain and MidOcean of all or any portion of their remaining ownership interest in the Issuer (the "Stock Sale"), the Issuer will diligently pursue and exercise its reasonable best efforts to obtain, as promptly as practicable, all necessary Education Approvals (as defined in the Purchase Agreement) required from all applicable Governmental Authorities (as defined in the Purchase Agreement) and Educational Agencies (as defined in the Purchase Agreement) for the lawful conduct of the businesses of the Issuer and its subsidiaries, including the University (as defined in the Purchase Agreement), following the Stock Sale in the manner and to the extent presently conducted at every location where the University conducts any material business (collectively, the "Required Approvals"). New Mountain and MidOcean severally agreed to directly pay up to $850,000 (with New Mountain paying up to $651,667 and MidOcean paying up to $198,333), as they are incurred, for all legal fees, accounting fees, education regulatory, SEC, NASDAQ filing fees, printing costs, roadshow costs and all other Registration Expenses (as defined in the Registration Rights Agreement) and other expenses of any kind reasonably incurred by the Issuer in connection with obtaining the Required Approvals and preparing for and effecting the Stock Sale, including any private sales and secondary offerings, whether or not the Stock Sale or any such sales or offerings are in fact consummated ("2004 Offering Expenses"); subject to the Issuer providing New Mountain and MidOcean with reasonably detailed supporting documentation in customary form, evidencing the incurrence of such 2004 Offering Expenses; provided, that New Mountain and MidOcean shall not be responsible for any such 2004 Offering Expenses incurred in connection with any registration effected pursuant to Section 2 of the Registration Rights Agreement other than the 2004 Offering. Notwithstanding the foregoing, except as modified by the February 2004 Letter Agreement, the February 2004 Letter Agreement shall not, in any manner, affect any of New Mountain's or MidOcean's rights under the Registration Rights Agreement, and all of the terms and conditions of the Registration Rights Agreement shall remain in full force and effect. Pursuant to the February 2004 Letter Agreement, the Issuer agreed that for so long as New Mountain beneficially owns at least 5% of the Common Stock determined on an as-converted basis (excluding (i) any shares of Series A Preferred Stock held of record by MidOcean, (ii) any shares of Common Stock MidOcean may acquire upon exercise of its portion of the Option, (iii) the Escrowed Shares, subject to the receipt of Required Approvals; provided that the Escrowed Shares do not revert back to New Mountain (the "Reversion") upon failure to receive Required Approvals within 120 days of such deposit and (iv) any additional Common Stock that New Mountain may acquire beneficial ownership of, following the date of the February 2004 Letter Agreement, except to the extent New Mountain acquires beneficial ownership of the Escrowed Shares due to the Reversion), the Issuer shall provide New Mountain with certain limited information rights, including the right to receive copies of all board packages, reports and materials so delivered to the Issuer's board of directors (the "Confidential Information"). New Mountain agreed to hold in strict confidence all such Confidential Information. Other than the Shareholders' Agreement, the Letter Agreement, the Purchase Agreement, the Support and Option Agreement, the Articles Supplementary, the Escrow Agreement, the Irrevocable Proxy, the Trust, the Amendment and Joinder to the Shareholders' Agreement, the Amendment to the Registration Rights Agreement, the February 2004 Letter Agreement and the related documents and the transactions contemplated thereby and other understandings, as described in this item, Item 1, Item 4 and Item 5 above, the Reporting Persons know of no other contracts, arrangements, understandings or relationships required to be described herein." Item 7. Material to be Filed as Exhibits. The disclosure in Item 7 is hereby supplemented by adding the following in appropriate numerical order: Exhibit 99.10. February 2004 Letter Agreement, dated February 3, 2004, among Strayer Education, Inc., New Mountain Partners, L.P. and MidOcean Capital Investors, L.P. SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. NEW MOUNTAIN PARTNERS, L.P. By: New Mountain Investments, L.P., its general partner By: New Mountain GP, LLC, its general partner By: /s/ Steven B. Klinsky -------------------------------- Name: Steven B. Klinsky Title: Member NEW MOUNTAIN INVESTMENTS, L.P. By: New Mountain GP, LLC, its general partner By: /s/ Steven B. Klinsky -------------------------------- Name: Steven B. Klinsky Title: Member NEW MOUNTAIN GP, LLC By: /s/ Steven B. Klinsky -------------------------------- Name: Steven B. Klinsky Title: Member /s/ Steven B. Klinsky -------------------------------- Name: Steven B. Klinsky Dated: February 4, 2004 EX-99 3 s776543.txt EX. 99.10 Exhibit 99.10 New Mountain Partners, L.P. MidOcean Capital Investors, L.P. 712 Fifth Avenue 320 Park Avenue 23rd Floor 17th Floor New York, NY 10019 New York, NY 10022 February 3, 2004 Strayer Education, Inc. 1100 Wilson Boulevard, Suite 2500 Arlington, VA 22209 Attention: Steven A. McArthur Senior Vice President and General Counsel Ladies and Gentlemen: Reference is made to (1) the Preferred Stock Purchase Agreement, dated as of November 28, 2000 (the "Preferred Stock Purchase Agreement"), by and among Strayer Education, Inc., a Maryland corporation (the "Company"), New Mountain Partners, L.P. ("New Mountain") and MidOcean Capital Investors, L.P. (formerly DB Capital Investors, L.P.) ("MidOcean") pursuant to which, among other things, the Company issued and sold to New Mountain and MidOcean an aggregate of 5,769,231 shares of the Company's Series A Convertible Preferred Stock, par value $0.01 per share ("Series A Preferred Stock"), (2) the Registration Rights Agreement, dated as of May 15, 2001 (the "Registration Rights Agreement"), by and among the Company, New Mountain and MidOcean, (3) the Articles Supplementary of the Company, as filed with the State Department of Assessments and Taxation of Maryland on May 15, 2001 (the "Articles Supplementary"), which, among other things, sets forth the powers, rights and other terms of the Series A Preferred Stock, (4) the Support and Option Agreement, dated as of November 28, 2000 by and among the Company, Ron K. Bailey individually and in any Representative Capacity, Beverly W. Bailey individually and in any Representative Capacity, and New Mountain and MidOcean (the "Support and Option Agreement") and (5) the letter agreement dated November 14, 2002 among the Company, New Mountain and MidOcean (the "Side Letter" and, together with the Preferred Stock Purchase Agreement, the Registration Rights Agreement and the Articles Supplementary, the Support and Option Agreement, the "Preferred Stock Documents"). Capitalized terms used and not otherwise defined herein have the meanings given in the Preferred Stock Documents. For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and notwithstanding anything to the contrary in the Preferred Stock Documents, the Company, New Mountain and MidOcean agree as follows: 1. Dividends. In order to resolve potentially differing interpretations of Section 7 of Article FIRST of the Articles Supplementary, the Company, New Mountain and MidOcean agree that, for purposes of determining the number of shares of Common Stock issuable in connection with any conversion of Series A Preferred Stock pursuant to the Articles Supplementary, full credit shall be given for dividends accruing on a daily basis since the most recent Dividend Payment Date preceding the Conversion Date through but excluding the Conversion Date. New Mountain and MidOcean (each a "Stockholder" and collectively, the "Stockholders") hereby release any claim they may have for accrued and unpaid dividends in connection with any conversions of Series A Preferred Stock prior to the date hereof, including, without limitation, as provided in paragraph 3(c) of the Side Letter, in connection with the conversion of shares of Series A Preferred Stock into Common Stock in November 2002. 2. Regulatory Approvals; Legal Fees. In connection with the possible sale or other disposition by the Stockholders of all or any portion of their remaining ownership interest in the Company (the "Sell Down"), the Company agrees to diligently pursue and exercise its reasonable best efforts to obtain, as promptly as practicable, all necessary Educational Approvals required from all applicable Governmental Authorities and Educational Agencies for the lawful conduct of the businesses of the Company, and its subsidiaries, including the University, following the Sell Down in the manner and to the extent presently conducted at every location where the University conducts any material business (collectively, the "Required Approvals"). The Stockholders hereby severally agree to directly pay up to $850,000 (with New Mountain paying up to $651,667 and MidOcean paying up to $198,333), as they are incurred, for all legal fees, accounting fees, education regulatory, SEC, NASDAQ filing fees, printing costs, roadshow costs and all other Registration Expenses (as defined in the Registration Rights Agreement) and other expenses of any kind reasonably incurred by the Company in connection with obtaining the Required Approvals and preparing for and effecting the Sell Down, including any private sales and secondary offerings, whether or not the Sell Down or any such sales or offerings are in fact consummated ("Sell Down Expenses"); subject to the Company providing the Stockholders with reasonably detailed supporting documentation in customary form, evidencing the incurrence of such Sell Down Expenses; provided, that the Stockholders' shall not be responsible for any such Sell Down Expenses incurred in connection with any registration effected pursuant to Section 2 of the Registration Rights Agreement other than the first registration after the date hereof. Notwithstanding the foregoing, except as expressly modified hereby, this Letter Agreement shall not, in any manner, affect any of the Stockholders' rights under the Registration Rights Agreement, and all of the terms and conditions of the Registration Rights Agreement shall remain in full force and effect. 3. Information Rights. (a) For so long as New Mountain beneficially owns (within the meaning of Rule 13d-3 of the General Rules and Regulations under the Securities Exchange Act of 1934) at least 5% of the Common Stock determined on an as-converted basis (excluding (i) any shares of Series A Preferred Stock held of record by MidOcean, (ii) any shares of Common Stock MidOcean may acquire upon exercise of its portion of the Option, (iii) 350,000 shares of Series A Preferred Stock deposited by New Mountain into an escrow account (the "Escrowed Shares"), subject to the receipt of Required Approvals; provided that the Escrowed Shares do not revert back to New Mountain (the "Reversion") upon failure to receive Required Approvals within 120 days of such deposit and (iv) any additional Common Stock that New Mountain may acquire beneficial ownership of, following the date of this Letter Agreement, except to the extent New Mountain acquires beneficial ownership of the Escrowed Shares due to the Reversion), the Company shall furnish such Stockholder with: (i) promptly following delivery to members of the board of directors of the Company, copies of all board packages, reports and materials so delivered to the board of directors of the Company; and (ii) such other information as may be mutually agreed between the Company and such Stockholder. All information received by New Mountain or its Representatives pursuant to paragraph 3(a) of this Letter Agreement, together with any other confidential information previously provided by the Company or its Representatives (as defined hereinafter) to New Mountain or its Representatives ("Previous Confidential Information") is hereinafter referred to as "Confidential Information." (b) Notwithstanding the foregoing, the following will not constitute "Confidential Information" for purposes of this Letter Agreement: (i) information which was in the possession of New Mountain or its Representatives prior to receipt thereof from the Company (other than Previous Confidential Information); provided that such information is not subject to another confidentiality agreement with, or other obligation (legal, fiduciary or contractual) of secrecy, among the relevant parties; (ii) information which is now or hereafter becomes generally available to the public, other than as a result of a disclosure by New Mountain or its Representatives not in violation of this Letter Agreement; (iii) information which was or may hereafter be available to New Mountain on a non-confidential basis from a third party that is not known to such Stockholder or its Representatives, after reasonable inquiry, to be under any confidential obligation (legal, fiduciary or contractual) to the Company regarding such information; or (iv) information which is independently acquired or developed by New Mountain or its Representatives without violating any of its obligations under paragraph 3 of this Letter Agreement. (c) New Mountain agrees to, and to cause its agents, officers, directors, partners, employees, affiliates and advisors (collectively, "Representatives") to, (a) hold in strict confidence any Confidential Information received from the Company by such Stockholder or its Representatives pursuant to paragraph 3(a) of this Letter Agreement, and (b) not use any Confidential Information for any purpose other than such Stockholder's internal evaluation of its investment in the Company; provided, however, that such Stockholder may reveal such portions of the Confidential Information (i) with the prior written consent of the Company, (ii) as required, pursuant to a judicial or regulatory proceeding, by subpoena, civil investigative demand or other similar legal process, after compliance with paragraph 3(d) of this Letter Agreement, and (iii) to its Representatives who need to know the Confidential Information in connection with such Stockholder's internal evaluation of its investment in the Company and who are informed by such Stockholder of the confidential nature of the Confidential Information. New Mountain will inform its Representatives of the terms of such Stockholder's obligation of confidentiality under this Letter Agreement, and will be responsible for any breach of such obligation of confidentiality by any of its Representatives. (d) If New Mountain or any of its Representatives is required, pursuant to a judicial or regulatory proceeding, by subpoena, civil investigative demand or other similar legal process to disclose any of the Confidential Information, such Stockholder will notify the Company promptly so that the Company may seek a protective order or other appropriate remedy or, in its sole discretion, waive compliance with the obligations of confidentiality under this Letter Agreement. In the event that no such protective order or other remedy is obtained, or the Company does not promptly waive compliance with the obligations of confidentiality under this Letter Agreement, New Mountain will furnish only that portion of the Confidential Information which is legally required to be disclosed and will, at the Company's request, use reasonable efforts to cooperate with the Company in obtaining reasonable assurance that confidential treatment will be accorded such Confidential Information. (e) New Mountain acknowledges that it is aware and that it will advise its Representatives that the U.S. securities laws prohibit any person who has material non-public information from purchasing or selling securities or communicating that information to any other person under circumstances where it is reasonably foreseeable that such other person is likely to purchase or sell securities. If New Mountain no longer beneficially owns at least 5% of the Common Stock determined on an as-converted basis excluding those shares excluded in clauses (i), (ii), (iii) and (iv) of the parenthetical of the first sentence of paragraph 3(a) above, then, upon the Company's written request, such Stockholder shall return to the Company, or cause to be returned to the Company, and/or destroy, or cause to be destroyed, any and all Confidential Information, in whatever form (whether hard copy, electronic or other form) no later than ten (10) business days after receipt of the Company's written request. (f) New Mountain understands and acknowledges that the Company is not making any representation or warranty, express or implied, as to the accuracy or completeness of the Confidential Information. The Company disclaims any and all liability to New Mountain and its Representatives arising from such party's use of, or reliance on the Confidential Information. (g) New Mountain agrees that money damages would not be sufficient remedy for any breach of such Stockholder's obligations of confidentiality under paragraph 3 of this Letter Agreement and, therefore, in addition to any other remedy available to the Company in the event of such Stockholder's breach of its obligations of confidentiality under paragraph 3 of this Letter Agreement, the Company shall also be entitled to specific performance and injunctive or other equitable relief. 4. Miscellaneous. (a) The Company hereby represents and warrants that the execution and delivery of this Letter Agreement and the performance by the Company of its obligations hereunder have been duly authorized by all necessary corporate action on the part of the Company, including authorization by the Company's board of directors at a meeting held on July 30, 2003, and no other corporate action on the part of the Company is necessary to authorize the execution, delivery and performance of this Letter Agreement. (b) Each Stockholder hereby represents and warrants that the execution and delivery of this Letter Agreement and the performance by such Stockholder of its obligations hereunder have been duly authorized by all necessary partnership action on the part of such Stockholder and no other partnership action on the part of such Stockholder is necessary to authorize the execution, delivery and performance of this Letter Agreement. (c) The agreement set forth in the first sentence of paragraph 1 of this Letter Agreement shall inure to the benefit of and shall be enforceable by transferees from the Stockholders and the other holders from time to time of Series A Preferred Stock, it being understood that such parties are intended third party beneficiaries thereof. The other provisions of this Letter Agreement shall not inure to the benefit of and shall not be enforceable by transferees from the Stockholders and other holders from time to time of Series A Preferred Stock, it being understood that such parties are not intended third party beneficiaries thereof. (d) It is understood and agreed that no failure or delay by either party in exercising any of its respective rights, powers or privileges hereunder shall operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any other or further exercise of any right, power or privilege. In case any provision of this Letter Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions of this Letter Agreement shall not in any way be affected or impaired thereby. (e) This Letter Agreement may not be amended or modified except by a writing executed by the Company and the Stockholders. (f) The internal laws, and not the laws of conflicts (other than Section 5-1401 General Obligations Law of the State of New York), of New York shall govern the enforceability and validity of this Letter Agreement, the construction of its terms and the interpretation of the rights and duties of the parties. (g) This Letter Agreement may be executed in one or more separate counterparts, each of which is deemed an original and both of which taken together constitute one and the same Letter Agreement. Very truly yours, NEW MOUNTAIN PARTNERS, L.P. By: New Mountain Investments, L.P., its general partner By: New Mountain GP, LLC, its general partner By: /s/ Steven B. Klinsky ----------------------------- Name: Steven B. Klinsky Title: Member MIDOCEAN CAPITAL INVESTORS, L.P. By: MidOcean Capital Partners, L.P., its general partner By: Existing Fund GP, Ltd., its general partner By: /s/ J. Edward Virtue ---------------------------- Name: J. Edward Virtue Title: Managing Director Agreed to and Accepted as of the date first above written: STRAYER EDUCATION, INC. By: /s/ Steven A. McArthur ---------------------------- Name: Steven A. McArthur Title: Senior Vice President and General Counsel -----END PRIVACY-ENHANCED MESSAGE-----