Company: LGCY
Filing Date: 2025-09-25
Form Type: 10-K
Source: 0001493152-25-014945
Chunk: 23

Company: Legacy Education Inc.
Filing Date: 2025-09-25
Form: 10-K
Item: Item 1
Chunk 23
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revenues. As noted elsewhere, our degree programs also will be subject to a new separate earnings measure under the OBBBA. See “Risk
Factor - ED’s financial value transparency and gainful employment regulations may limit the programs we can offer students and
increase our cost of operations.”

Borrower
Defense to Repayment Regulations. In 1994, pursuant to certain provisions of the Higher Education Act, ED published its first
version of the “borrower defense to repayment” (“BDR”) regulations which generally allow federal student loan
borrowers to assert a defense to repaying their federal loans based on the conduct of the institution they attended. The amount of loans
discharged by ED pursuant to an adjudicated BDR claim may be assessed by ED as a Title IV Program liability against the institution.
On November 1, 2016, the Department adopted revised BDR regulations that became effective on July 1, 2017. Under the 2017 version of
the BDR regulations, borrowers with federal student loans disbursed after July 1, 2017 can assert a defense to repayment and be eligible
for relief based on a nondefault, favorable, contested judgement against the institution from a state or federal court; a claim that
the institution failed to perform its obligations under a contract with the student or a claim the institution committed a “substantial
misrepresentation” on which the borrower reasonably relied to his or her detriment. On September 23, 2019, the Department again
revised its BDR regulations effective July 1, 2020, and created a distinct standard and process for BDR applications applicable to federal
student loans first disbursed after July 1, 2020. Under the 2019 version of the BDR regulations, a borrower can assert a defense to repayment
and be eligible for relief if the borrower establishes that the institution made a misrepresentation of material fact upon which the
borrower reasonably relied in deciding to obtain their loan; the misrepresentation related to the borrower’s enrollment or continuing
enrollment at the institution or the provision of education services for which the loan was made; and the borrower was financially harmed
by the misrepresentation.

On
November 1, 2022, ED again revised the BDR regulations with an effective date of July 1, 2023. The 2022 version of the BDR regulations
included amendments regarding, among other things, (i) acts or omissions by or on behalf of an