Company: LGCY
Filing Date: 2025-09-25
Form Type: 10-K
Source: 0001493152-25-014945
Chunk: 372

Company: Legacy Education Inc.
Filing Date: 2025-09-25
Form: 10-K
Item: Item 1A
Chunk 372
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 exceeding 90%. All of these calculations
are subject to review, differing interpretations, and potential recalculation by ED which makes it more difficult for our institutions
to comply with the 90/10 Rule. A loss of eligibility to participate in Title IV Programs for any of our institutions would have a significant
impact on the rate at which our students enroll in our programs and on our business and results of operations. Moreover, if an institution
violated the 90/10 Rule and became ineligible to participate in Title IV Programs but continued to disburse Title IV Program funds, ED
would require the institution to repay all Title IV Program funds received by the institution after the effective date of the loss of
eligibility.

59

The
American Rescue Plan Act (“ARPA”) amended the 90/10 Rule by treating other federal student financial assistance funds in
the same manner as Title IV Program funds in the 90/10 Rule percentage. This amendment requires our institutions to limit the combined
amount of Title IV Program funds and other federal student financial assistance funds in a fiscal year to no more than 90% in a fiscal
year as calculated under the 90/10 Rule. ED published final regulations on the 90/10 Rule on October 28, 2022. The final regulations
became effective July 1, 2023 and applied to fiscal years beginning on or after January 1, 2023 (which was the fiscal years ending June
30, 2024 for our schools). The new rule modified how institutions counted revenue when calculating compliance with the 90/10 Rule, and
added a requirement to notify students of the potential loss of eligibility resulting from not meeting the 90/10 standard, among other
changes. ED has published a Notice in the Federal Register listing the types of funds that are considered federal education assistance
funds under the new 90/10 Rule. The funds include GI Bill funding and Military Tuition Assistance, among other sources of funds. We expect
the change in the 90/10 Rule will increase our 90/10 Rule percentages and make it more difficult to comply with the 90/10 Rule and could
require changes to maintain compliance.

ED
regulations have restricted the ability of institutions to limit the amount of Title IV Program loans that students and parents may borrow
which can impact our ability to control compliance with the 90/10 Rule at our institutions. However, under a provision of the OBBBA that
will be effective