8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): February 11, 2022

UNIVERSAL TECHNICAL INSTITUTE, INC.

(Exact name of registrant as specified in its charter)

Delaware	1-31923	86-0226984
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

4225 E. Windrose Drive, Suite 200, Phoenix, Arizona	85032
(Address of principal executive offices)	(Zip Code)

(623) 445-9500

(Registrant’s telephone number, including area code)

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Common Stock, par value $0.0001 per share	UTI	New York Stock Exchange
(Title of each class)	(Trading symbol)	(Name of each exchange on which registered)

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

☐ Emerging growth company

☐ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Item 1.01. Entry into a Material Definitive Agreement.

As previously reported, on February 4, 2022, Universal Technical Institute, Inc., a Delaware corporation (the “Company”), together with its subsidiary, Universal Technical Institute Ventures, LLC, a Delaware limited liability company (“UTI Ventures”), acquired an indirect 34.2133% interest in 2611 Corporate West Drive Venture LLC, a Delaware limited liability company (the “Target”) and the owner of the Company’s campus located in Lisle, Illinois (the “Lisle Campus”). Upon the closing of this acquisition on February 8, 2022, and after giving effect to its previously existing 27.972% ownership interest in the Target, UTI Ventures held a 62.1853% ownership interest in the Target.

On February 11, 2022, the Company, together with UTI Ventures, entered into a definitive Purchase and Sale Contract (the “Purchase Agreement”) with iStar Net Lease Member I LLC, a Delaware limited liability company (“Seller”), pursuant to which UTI Ventures agreed to purchase from Seller (the “Acquisition”) the remaining 37.8147% interest in the Target. The parties closed the Acquisition on February 14, 2022. As a result of the Acquisition, and after giving effect to UTI Ventures’ previously existing 62.1853% ownership interest in the Target, the Target became a wholly owned subsidiary of UTI Ventures. The Acquisition will not result in any changes to the Company’s operations at the Lisle Campus.

The purchase price paid for the Acquisition, after giving effect to certain adjustments, prorations, and credits, was $14.9 million. The Company paid the purchase price with cash on hand. The Purchase Agreement contains customary representations, warranties, and indemnities by the parties.

Target is a party to a Loan Agreement, dated October 13, 2017 (the “Existing Loan Agreement”), with Western Alliance Bank, an Arizona corporation (“Lender”), which is secured by a mortgage on the Lisle Campus. Concurrent with and in connection with the Acquisition, and pursuant to the terms of a Modification Agreement (the “Modification Agreement”), effective as of February 14, 2022, by and between Target and Lender, Lender consented to UTI Ventures’ acquisition of all of the ownership interests in the Target and the Company executed a Repayment Guaranty for the benefit of Lender (the “Repayment Guaranty”), pursuant to which it guaranteed the payment obligations of the Target under the Existing Loan Agreement.

The Target is subject to certain customary affirmative and negative covenants in connection with the Existing Loan Agreement, including, without limitation, certain reporting obligations and a debt service coverage ratio covenant. Events of default under the Existing Loan Agreement include, among others, the failure to make payments when due, breach of covenants, and breach of representations or warranties.

The foregoing descriptions of the Acquisition and Existing Loan Agreement do not purport to be complete and are qualified in their entirety by references to the Purchase Agreement, Modification Agreement, and Repayment Guaranty, copies of which, if required, will be timely filed as exhibits to an upcoming periodic report in accordance with applicable rules and regulations of the Securities and Exchange Commission.

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated by reference herein.

Item 7.01. Regulation FD Disclosure.

On February 16, 2022, UTI issued a press release announcing the Acquisition. A copy of the press release is filed herewith as Exhibit 99.1.

Item 9.01. Consolidated Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.	Description
99.1	Press Release, dated February 16, 2022
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

2

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated: February 16, 2022	Universal Technical Institute, Inc.
	By:	/s/ Christopher Kevane
	Name:    Christopher Kevane
	Title:      Senior Vice President and Chief Legal Officer

3

EX-99.1

Exhibit 99.1

Media Contact

avitucci@uti.edu

480.710.6843

For Immediate Release

UTI Announces Purchase of Lisle, Ill Campus from Joint Venture Partner

PHOENIX (Feb. 16, 2022) – Universal Technical Institute (UTI) (the Company) announced today the completion of a series of transactions resulting in the 100% ownership of its Lisle, Ill campus through a wholly owned subsidiary, 2611 Corporate West Drive Ventures, LLC (2611 CWD). This was accomplished by the acquisition of the approximately 72% ownership of 2611 CWD previously held by iStar Net Lease I LLC, a Delaware limited liability company. The Company had held an approximately 28% stake in the 2611 CWD joint venture formed to own and develop the property in 2012. The Company has maintained a presence in Illinois since 1988 and has been in the Lisle location since the fall of 2013 when the current facility was built. There are no changes to the campus operations as a result of these transactions.

The total net purchase price to acquire the approximately 72% stake in 2611 CWD was $28.2M in cash plus assumption of a prorated portion of the existing debt. As a result of the transactions, through 2611 CWD, the Company is the sole obligor for total current outstanding debt of approximately $18.5M for the campus.

“We have a long history in the state of Illinois and have a long-term commitment to the Lisle campus. Additionally, real estate optimization is an ongoing element of our growth and diversification and cost management strategies,” said Troy Anderson, chief financial officer. “Over the last several years we have restructured leases, consolidated sites, and in some cases, we have leveraged our strong balance sheet and been an opportunistic buyer. With these transactions, we had the opportunity to own 100% of the Lisle campus for a total basis below current market value, while delivering significant EBITDA and cash flow benefits versus continuing to lease the facility.”

The campus is a 187,000 square foot state-of-industry facility located on approximately 20 acres along the Interstate 88 research and development corporate corridor in Lisle, a suburb of Chicago. The campus currently has over 900 students, with available capacity for measurably more students, and offers the Company’s core automotive and diesel programs and the welding technology program. The campus also has several Manufacturer Specific Advanced Training (MSAT) programs including Ford, Toyota, Peterbilt, Daimler Trucks, and the Fendt Technician Academy, the Company’s first agricultural-focused MSAT.

In support of the acquisition of the campus, the Company is actively pursuing new financing that would retire the debt it assumed to facilitate the transaction, and fund a portion of the net cash proceeds. This would allow it to benefit from the more attractive interest rate environment and the current market value of the asset.

About Universal Technical Institute, Inc.

Founded in 1965 and headquartered in Phoenix, Universal Technical Institute’s (NYSE: UTI) mission is to serve our students, partners, and communities by providing quality education and support services for in-demand careers. Approximately 250,000 students have graduated from one of UTI’s 14 campuses located across Arizona, California, Florida, Illinois, Michigan, North Carolina, Pennsylvania, New Jersey, and Texas. UTI’s campuses are accredited by the Accrediting Commission of Career Schools and Colleges (ACCSC), while its employer-aligned technical training programs are offered under four brands: Universal Technical Institute, Motorcycle Mechanics Institute / Marine Mechanics Institute, NASCAR Technical Institute, and MIAT College of Technology. For more information and a complete list of all programs offered, please visit www.uti.edu or follow on LinkedIn @UniversalTechnicalInstitute.

XML

Document and Entity Information	Feb. 11, 2022
Cover [Abstract]
Entity Registrant Name	UNIVERSAL TECHNICAL INSTITUTE INC
Amendment Flag	false
Entity Central Index Key	0001261654
Document Type	8-K
Document Period End Date	Feb. 11, 2022
Entity Incorporation State Country Code	DE
Entity File Number	1-31923
Entity Tax Identification Number	86-0226984
Entity Address, Address Line One	4225 E. Windrose Drive
Entity Address, Address Line Two	Suite 200
Entity Address, City or Town	Phoenix
Entity Address, State or Province	AZ
Entity Address, Postal Zip Code	85032
City Area Code	(623)
Local Phone Number	445-9500
Written Communications	false
Soliciting Material	false
Pre Commencement Tender Offer	false
Pre Commencement Issuer Tender Offer	false
Security 12b Title	Common Stock, par value $0.0001 per share
Trading Symbol	UTI
Security Exchange Name	NYSE
Entity Emerging Growth Company	false