Company: LGCY
Filing Date: 2025-09-25
Form Type: 10-K
Source: 0001493152-25-014945
Chunk: 140

Company: Legacy Education Inc.
Filing Date: 2025-09-25
Form: 10-K
Item: Item 1
Chunk 140
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 CARES Act included a $14 billion Higher Education Emergency Relief Fund (“HEERF”) for ED to distribute
directly to institutions of higher education. Institutions were required to use at least half of the HEERF funds for emergency grants
to students for expenses related to disruptions in campus operations (e.g., food, housing, etc.). Institutions were permitted to use
the remainder of the funds for additional emergency grants to students or to cover institutional costs associated with significant changes
to the delivery of instruction due to the COVID-19 emergency, provided that those costs do not include payment to contractors for the
provision of pre-enrollment recruitment activities, endowments, or capital outlays associated with facilities related to athletics, sectarian
instruction, or religious worship. The law required institutions receiving funds to continue to the greatest extent practicable to pay
its employees and contractors during the period of any disruptions or closures related to the COVID-19 emergency.

ED
subsequently allocated funds to each institution of higher education based on a formula contained in the CARES Act. The formula was heavily
weighted toward institutions with large numbers of Pell Grant recipients. ED collectively allocated approximately $3.1 million to our
schools. As of June 30, 2022, we had used approximately $2.1 million on student grants and approximately $1.0 million of the allocated
funds were reimbursements for qualified expenses. These qualified expenses were reflected on the statement of operations as reductions
to general and administrative expenses. The failure to comply with requirements for the usage and reporting of these funds could result
in requirements to repay some or all of the allocated funds and in other sanctions.

82

During
the fiscal year ended June 30, 2021, we applied for certain Employee Retention Credits (“ERTC”) under the CARES Act in the
approximate $2.9 million, which was reflected within the statement of operations as a reduction to educational services expense. The
remaining balance of the ERTC receivable as of December 31, 2023 was $47,000.

During
the fiscal year ended June 30, 2020, pursuant to the Payroll Protection Program (“PPP”) established under the CARES Act,
we had obtained a loan in the amount of $1.4 million (“PPP Loan”). Upon our request, the PPP Loan was subject to forgiveness,
to the extent that the proceeds were used to pay expenses permitted by the PPP, including payroll costs, covered rent, mortgage obligations
and covered