Company: LGCY
Filing Date: 2025-09-25
Form Type: 10-K
Source: 0001493152-25-014945
Chunk: 387

Company: Legacy Education Inc.
Filing Date: 2025-09-25
Form: 10-K
Item: Item 1A
Chunk 387
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 subjects including, without limitation, the accuracy and substantiation
of rates of graduation, job placement, and passage of occupational licensure examinations. Noncompliance with these requirements could
result in sanctions, liabilities, or third-party litigation that could have an adverse effect on our business and results of operations.
ED published a final rule on November 1, 2022 which expanded the scope of prohibited misrepresentations, and which also prohibits certain
types of conduct with respect to the recruitment of students. The adoption and implementation of new regulations could lead to findings
of noncompliance and result in liabilities and other sanctions that could have an adverse effect on our business and results of operations.

In
addition, the FTC has indicated an increased focus on direct or implied misrepresentations. For example, on October 6, 2021, the FTC
issued letters including a “Notice of Penalty Offenses Concerning Deceptive or Unfair Conduct in the Education Marketplace”
to 70 institutions of higher education, but not any of our institutions. These letters were meant to place the recipients on actual notice
of conduct the FTC previously found to violate the Federal Trade Commission Act. This conduct included several categories of direct or
implied misrepresentations made by proprietary schools. These letters may reflect an increased interest by the FTC in monitoring schools
in the for-profit proprietary school sector, including our schools. If our institutions fail to comply with an FTC statute or rule or
are found to have committed misconduct determined to be unfair, deceptive, or otherwise improper, we and our institutions could face
civil penalties, injunctions, or other remedies available to the FTC.

If
our institutions fail to comply with regulations regarding accurate and timely refunds and returns of Title IV Program funds in connection
with students who withdraw from their programs, we could be subject to liabilities and sanctions.

An
institution participating in the Title IV Programs must calculate the amount of unearned Title IV Program funds that have been disbursed
to students who withdraw from their educational programs before completing them, and must return those unearned funds to ED in a timely
manner, which is generally within 45 days from the date the institution determines that the student has withdrawn. The failure to timely
return funds can result in liabilities or sanctions.

67

If
an institution is cited in an audit or program review for late returns of Title IV Program funds for 5% or more of the pertinent students
within the audit or program review sample, or if an audit identifies a material weakness in the