Company: LGCY
Filing Date: 2025-09-25
Form Type: 10-K
Source: 0001493152-25-014945
Chunk: 35

Company: Legacy Education Inc.
Filing Date: 2025-09-25
Form: 10-K
Item: Item 1
Chunk 35
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 directly or indirectly owns at least 50% of the institution discloses in public securities exchange filing that it is under
    investigation for possible violation of law;

    ●
    the institution is cited
    by another federal agency and risks losing education assistance funds by that agency;

    ●
    the institution is required
    to submit a teach-out plan due to concerns other than those constituting a mandatory triggering event; or

    ●
    any other event or condition
    that ED finds is likely to have significant adverse effect on the financial condition of the institution.

The
regulations require an institution to notify ED of the occurrence of a mandatory or discretionary triggering event and, in some cases,
provide an opportunity to submit certain information to ED to demonstrate why the event does not establish the institution’s lack
of financial responsibility or require the submission of a letter of credit and impose other conditions or requirements. If more than
one of these financial responsibility triggers occur, ED could impose separate letters of credit to address each triggering event.

The
financial responsibility regulations could result in ED recalculating and reducing our composite score, on a retroactive basis, to account
for ED estimates of potential losses under one or more of the extensive list of triggering circumstances and also could result in the
imposition of conditions and requirements including a requirement to provide one or more letters of credit or other form of financial
protection. It is difficult to predict the amount or duration of any letter of credit requirements that ED might impose under the regulation.
The requirement to submit letters of credit or to accept other conditions or restrictions could have a material adverse effect on our
schools’ business and results of operations.

Accreditor
and state regulatory requirements also address financial responsibility, and these requirements vary among agencies and also are different
from ED requirements. Any developments relating to our satisfaction of ED’s financial responsibility requirements may lead to additional
focus or review by our accreditors or applicable state agencies regarding their respective financial responsibility requirements.

If
our institutions fail to maintain financial responsibility, they could lose their eligibility to participate in the Title IV Programs,
have that eligibility adversely conditioned or be subject to similar negative consequences under accreditor and state regulatory requirements,
which would have a material adverse effect on our business. In particular, limitations on, or termination of, participation in the Title
IV Programs as a result of the failure to demonstrate financial responsibility or administrative capability would limit students’
access to Title IV Program funds, which would materially and adversely reduce the enrollments and revenues of our