Exhibit 10.3


 


Sterling
National Bank


61
South Paramus Road, Suite 116


Paramus,
New Jersey 07652





 


September
23, 2021                                                             


 


VIA EMAIL


 


Lincoln
Educational Services Corporation


200 Executive
Drive


West Orange, New Jersey 07052


Attention: Brian K. Meyers, CFO


 


		Re:	Sterling National Bank
to Lincoln Educational Services Corporation – Consent to Departure from Certain Terms of Loan Documents



 


Dear Mr. Meyers:


 


Reference
is hereby made to that certain Credit Agreement dated as of November 14, 2019 (as amended, modified, or supplemented from time
to time, including by that certain First Amendment to Credit Agreement dated as of November 10, 2020, together with any subsequent
amendments thereto, the “Credit Agreement”) by and among Lincoln Educational Services Corporation, Lincoln
Technical Institute, Inc., Nashville Acquisition, L.L.C., New England Acquisition, LLC, Euphoria Acquisition, LLC, LCT Acquisition,
LLC, NN Acquisition, LLC and LTI Holdings LLC (individually and collectively, “Borrower”) and Sterling National
Bank (“Bank”) pursuant to which Bank made available to Borrower certain senior secured credit facilities consisting
of (i) a $15,000,000.00 senior secured revolving line of credit (the “Line of Credit”); (ii) a $20,000,000.00
senior secured term loan (the “Term Loan”); (iii) a $10,000,000.00 senior secured revolving loan facility available
for the issuance of letters of credit (the “LC Facility”); and (iv) a $10,000,000.00 delayed draw term loan
(the “Delayed Draw Term Loan” and together with the Line of Credit, the Term Loan and the LC Facility, the
“Credit Facilities”). Capitalized terms used herein without definition shall have the meaning assigned to such
terms in the Credit Agreement. The Credit Facilities are secured by, among other things, (i) that certain Deed of Trust, Assignment
of Leases and Rents, Security Agreement and Fixture Filing by Lincoln Technical Institute, Inc. in favor of Bank, for the property
located in the State of Texas, (ii) that certain Deed of Trust and Security Agreement by LTI Holdings, LLC, in favor of Bank,
for the property located in the State of Colorado, and (iii) that certain Deed of Trust and Security Agreement by Nashville Acquisition,
L.L.C., in favor of Bank, for the property located in the State of Tennessee, each dated as of November 14, 2019 and as each of
the same may be amended, restated, modified or supplemented from time to time ( collectively, the “Mortgages”).


 


Borrower
has notified Bank that it desires to convey all of its right, title and interest in its real property, improvements and certain
personal property located at or otherwise related to (i) 1194 East 45th Avenue, Denver, Colorado (the “Colorado
Subject Property”), pursuant to the terms, conditions and provisions of that certain Agreement for Purchase and Sale
of Real Property dated on or about the date hereof (the “Colorado and Texas Disposition Agreement”), (ii) 2915
Aloutte Drive, Grand Prairie, Texas (the “Texas Subject Property”), pursuant to the terms, conditions and provisions
of the Colorado and Texas Disposition Agreement, and (iii) 524 Gallatin Avenue, Nashville, Tennessee (the “Tennessee
Subject Property”, and together with the Colorado Subject Property and the Texas Subject Property, collectively, the
“Subject Properties”), pursuant to the terms, conditions and provisions of that certain Contract for the Purchase
of Real Estate dated on or about the date hereof (the “Tennessee Disposition Agreement”, and together with
the Colorado and Texas Disposition Agreement, collectively, the “Disposition Agreements”), in each case free
and clear of the Mortgages and any other liens of Bank pursuant to the Mortgages or otherwise, and to lease Subject Properties
following their sale (the “Subject Transactions”). Inasmuch as, (i) the Subject Properties and related personal
property are subject to the Mortgages and serve as Collateral for all of the Obligations and Borrower does not intend to discharge
all of the Obligations with the proceeds of the dispositions of the Subject Properties and (ii) the dispositions of the Subject
Properties and related assets contemplated by the Disposition Agreements and the other Subject Transactions are restricted by
Section 7.3, 7.6 and 7.7 of the Credit Agreement, Borrower has requested the consent of Lender to proceed with said
dispositions as contemplated in the Disposition Agreements and to waive any default or event of default that would otherwise arise
out of the consummation of the Subject Transations.



    	 



    	 



    




To
induce Bank to grant said waiver consent, Borrower hereby represents and warrants that, other than with respect to the violations
described above and consented hereto:


 


		(i)	there
                                         does not exist any default or event of default under the Loan Documents, and no default
                                         or event of default will exist or would result from the Subject Transactions except for
                                         such defaults or events of default that that are waived hereby;



 


		(ii)	Borrower
                                         is in compliance, in all material respects, with all terms and conditions of the Loan
                                         Documents; and



 


		(iii)	both
                                         before and after giving effect to the Subject Transactions, each of the representations
                                         and warranties in the Loan Documents is, and will be, true and correct in all material
                                         respects (except any such representation or warranty which relates to a specified prior
                                         date).



 


Based
on the foregoing, but subject to the conditions set forth below, Bank hereby consents to the Subject Transactions and waive any
default or event of default that would otherwise arise out of their consummation. For the avoidance of doubt, the parties hereto
hereby confirm that the consent and waiver set forth herein pertains only to the Subject Transactions, and only to the extent
described herein. Any leases which are part of the Subject Transactions shall not be considered in determining whether lease payments
otherwise permitted under Section 7.3 exceed $1,000,000 in the aggregate.


 


It
is expressly understood and agreed that Bank’s consent as set forth above is expressly conditioned on the following:


 


		(a)	Prior
                                         to the release of the Mortgages with respect to the Subject Properties and to the release
                                         of its lien on any related personal property which is the subject to the Subject Transactions,
                                         the Borrower shall pay to the Bank, in good and available funds, an amount sufficient
                                         to pay-in-full the outstanding principal balance of the Term Loan and the Delayed Draw
                                         Term Loan, together with any and all accrued interest thereon through and including date
                                         of said receipt of said funds, along with an amount sufficient to pay-in-full any Swap
                                         Obligations arising from any Swap Transaction entered into in connection with the Term
                                         Loan, as determined by the parties on or before said disposition date; and



 


		(b)	Borrower
                                         shall pay any and all legal fees and expenses incurred by the Bank in connection with
                                         the Disposition Transactions, including, but not limited to, legal fees for the preparation
                                         and/or review of any instruments needed to release the Subject Properties from the lien
                                         of the Mortgages.







    	2



    	 



    




For
the avoidance of doubt, the parties hereto acknowledge and agree that Bank shall not be obligated to release its Mortgage and
other liens on related personal property unless and until the Subject Transaction to which such Mortgage and other liens relate
is consummated. Accordingly, upon the consummation of the first Subject Transaction yielding sufficient proceeds to satisfy the
payment obligations in clause (a) above, Bank shall release its Mortgage and other liens on personal property related to such
Subject Transaction and shall release its Mortgage and other liens on personal property with respect to the second Subject Transaction
to be consummated upon said consummation so long as at such time, no Default or Event of Default then exists and is continuing.


 


Upon
the satisfaction of the aforementioned connection and in connection with the consummation of the Subject Transactions, Bank hereby
agrees to execute and deliver to Borrower such discharges of the Mortgages and any other instruments related to the discharge
of said mortgage and other liens, in each case as Borrower may reasonably request.


 


Furthermore,
the parties acknowledge and agree that as of the date hereof advances under the Delayed Draw Term Loan shall no longer be available
to Borrower and any commitment of Bank to lend thereunder shall be terminated and of no further force and effect.


 


The
grant by Bank of the consent set forth herein shall in no way alter the existing obligations of Borrower under the Loan Documents,
other than as specifically contemplated herein. Under no circumstances shall such waiver and consent be interpreted or construed
as establishing a custom or course of dealing between Borrower and Bank with respect to any instance of non-compliance with the
terms of the Loan Documents that might arise in the future. Bank reserves its right to respond in accordance with the Loan Documents
to such instances of non-compliance in any manner it deems necessary or appropriate under those specific circumstances.


 


Bank’s
waiver and consent as set forth herein shall not be effective unless and until Bank has received this letter fully executed and
validly delivered by all parties hereto.


 


Borrower
agrees to pay the fees and expenses of Bank’s counsel for services rendered in connection with this preparation of this
letter agreement (including services rendered in connection with this consent and the review of any due diligence in connection
therewith) promptly upon presentation of an invoice from said counsel for said services.


 


This
letter agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the
signatures thereto are on the same instrument. This letter agreement may be executed and delivered by facsimile or by .pdf file
and upon such delivery the facsimile or .pdf signature will be deemed to have the same effect as if the original signature had
been delivered to the other party. This letter agreement shall be construed in accordance with the substantive laws of the State
of New Jersey without reference to any conflicts of law principles.





 


[Remainder
of Page Intentionally Left Blank; Signature Pages to Follow]




    	3



    	 



    




	 	 	 
	 	Very truly
    yours,
	 	 
	 	STERLING
    NATIONAL BANK
	 	 
	 	By: 	/s/
    Mark R. Smith
	 	 	Mark R. Smith
	 	 	Senior Vice President
    & Managing Director










	 	 	 
	Acknowledged and Agreed
    to:	 
	 	 
	BORROWER:	 
	 	 
	LINCOLN EDUCATIONAL SERVICES	 
	CORPORATION	 
	 	 
	By: 	/s/ Scott M. Shaw                 	 
	 	Scott M. Shaw	 
	 	Chief Executive Officer	 
	 	 
	LINCOLN TECHNICAL INSTITUTE,
    INC.	 
	 	 
	By:	/s/ Scott M. Shaw	 
	 	Scott M. Shaw	 
	 	President	 
	 	 
	NASHVILLE ACQUISITION,
    L.L.C.	 
	 	 
	By:	/s/ Scott M. Shaw	 
	 	Scott M. Shaw	 
	 	President	 
	 	 
	NEW ENGLAND ACQUISITION,
    LLC	 
	 	 
	By:	/s/ Scott M. Shaw	 
	 	Scott M. Shaw	 
	 	President	 
	 	 
	EUPHORIA ACQUISITION,
    LLC	 
	 	 
	By:	/s/ Scott M. Shaw	 
	 	Scott M. Shaw	 
	 	President	 







 


[Signature
Page to Consent Letter]




    	 



    	 



    




	 	 	 
	LCT ACQUISITION, LLC	 
	 	 
	By: 	/s/ Scott M. Shaw	 
	 	Scott M. Shaw	 
	 	President	 
	 	 
	NN ACQUISITION, LLC	 
	 	 
	By: 	/s/ Scott M. Shaw	 
	 	Scott M. Shaw	 
	 	President	 
	 	 
	LTI HOLDINGS, LLC	 
	 	 
	By:	 /s/ Scott M. Shaw	 
	 	Scott M. Shaw	 
	 	President	 




 


[Signature
Page to Consent Letter]