☒
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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New Jersey
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57-1150621
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(State or other jurisdiction of incorporation or organization)
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(IRS Employer Identification No.)
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Title of each class
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Name of exchange on which registered
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Common Stock, no par value per share
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The NASDAQ Stock Market LLC
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Large accelerated filer ☐
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Accelerated filer ☐
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Non-accelerated filer ☐
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Smaller reporting company ☒
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PART I.
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1
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ITEM 1.
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1
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ITEM 1A.
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18
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ITEM 1B.
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24
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ITEM 2.
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25
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ITEM 3.
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26
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ITEM 4.
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26
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PART II.
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27
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ITEM 5.
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27
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ITEM 6.
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30
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ITEM 7.
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32
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ITEM 7A.
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49
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ITEM 8
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49
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ITEM 9.
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49
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ITEM 9A.
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49
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ITEM 9B.
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50
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PART III.
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50
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ITEM 10.
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50
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ITEM 11.
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50
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ITEM 12.
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50
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ITEM 13.
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50
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ITEM 14.
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50
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PART IV.
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51
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ITEM 15.
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51
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· |
our failure to comply with the extensive existing regulatory framework applicable to our industry or our failure to obtain timely regulatory approvals in connection with a change of control of our company or acquisitions;
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· |
the promulgation of new regulations in our industry as to which we may find compliance challenging;
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· |
our success in updating and expanding the content of existing programs and developing new programs in a cost-effective manner or on a timely basis;
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· |
our ability to implement our strategic plan;
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· |
risks associated with changes in applicable federal laws and regulations including pending rulemaking by the U.S. Department of Education;
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· |
uncertainties regarding our ability to comply with federal laws and regulations regarding the 90/10 rule and cohort default rates;
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· |
risks associated with opening new campuses and closing existing campuses;
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· |
risks associated with integration of acquired schools;
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· |
industry competition;
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· |
conditions and trends in our industry;
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· |
general economic conditions; and
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· |
other factors discussed under the headings “Business,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
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Segment
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Status
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School
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2015
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2016
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2015
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2016
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Allentown, PA
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HOPS (Discontinued Operations)
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HOPS (Discontinued Operations)
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Held for sale
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Held for sale
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1
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Edison, NJ
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HOPS (Discontinued Operations)
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HOPS (Discontinued Operations)
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Held for sale
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Held for sale
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1
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Moorestown, NJ
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HOPS (Discontinued Operations)
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HOPS (Discontinued Operations)
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Held for sale
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Held for sale
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1
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Paramus, NJ
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HOPS (Discontinued Operations)
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HOPS (Discontinued Operations)
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Held for sale
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Held for sale
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1
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Lincoln, RI
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HOPS (Discontinued Operations)
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HOPS (Discontinued Operations)
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Held for sale
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Held for sale
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1
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Brockton, MA
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HOPS (Discontinued Operations)
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HOPS (Discontinued Operations)
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Held for sale
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Held for sale
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1
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Somerville, MA
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HOPS (Discontinued Operations)
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HOPS (Discontinued Operations)
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Held for sale
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Held for sale
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1
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Lowell, MA
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HOPS (Discontinued Operations)
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HOPS (Discontinued Operations)
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Held for sale
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Held for sale
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1
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New Britain, CT
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HOPS (Discontinued Operations)
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HOPS (Discontinued Operations)
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Held for sale
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Held for sale
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1
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Shelton, CT
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HOPS (Discontinued Operations)
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HOPS (Discontinued Operations)
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Held for sale
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Held for sale
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1
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Las Vegas (Summerlin), NV
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HOPS (Discontinued Operations)
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HOPS (Discontinued Operations)
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Held for sale
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Held for sale
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1
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Southington, CT
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HOPS (Discontinued Operations)
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HOPS (Discontinued Operations)
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Held for sale
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Held for sale
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1
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Marietta, GA
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HOPS (Discontinued Operations)
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HOPS (Discontinued Operations)
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Held for sale
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Held for sale
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1
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Hartford, CT
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Transitional (Continuing Operations)
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HOPS (Discontinued Operations)
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Teach-out
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Closed
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2
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Henderson (Green Valley), NV
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HOPS (Discontinued Operations)
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HOPS (Discontinued Operations)
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Held for sale
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Closed
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3
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Center City Philadelphia, PA
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HOPS (Discontinued Operations)
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Transitional (Continuing Operations)
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Held for sale
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Teach-out
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4
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Northeast Philadelphia, PA
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HOPS (Discontinued Operations)
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Transitional (Continuing Operations)
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Held for sale
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Teach-out
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4
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West Palm Beach, FL
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HOPS (Discontinued Operations)
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Transitional (Continuing Operations)
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Held for sale
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Teach-out
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5
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Fern Park, FL
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Transitional (Continuing Operations)
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Transitional (Continuing Operations)
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Teach-out
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Closed
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6
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1 |
In November 2015, the Board of Directors approved a plan to divest these schools and thus they are included in discontinued operations as of December 31, 2016 and 2015.
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2 |
In November 2015, the Board of Directors approved a plan to divest this school. In December 2015, the Board of Directors approved a plan to cease operations at this school. The school was included in the Transitional Segment and included in continuing operations until it closed in the fourth quarter of 2016; it is included in discontinued operations as of December 31, 2016.
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3 |
In November 2015, the Board of Directors approved a plan to divest this school. In the fourth quarter of 2016, the Board of Directors approved a plan to cease operations at this school, which closed in the fourth quarter of 2016 and is included in discontinued operations as of December 31, 2016.
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4 |
In November 2015, the Board of Directors approved a plan to divest these schools. In the fourth quarter of 2016, the Board of Directors approved a plan to cease operations at these schools which are being taught-out and expected to be closed in 2017. These schools are included in the Transitional segment and continuing operations as of December 31, 2016.
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5 |
In November 2015, the Board of Directors approved a plan to divest this school. In the third quarter of 2016, the Board of Directors approved a plan to teach–out certain programs at this school. Then, in the fourth quarter of 2016, the Board of Directors approved a plan to teach-out the remainder of the programs at this school. The school is expected to be closed in 2017. This school’s operations are included in the Transitional segment and continuing operations as of December 31, 2016. However, as part of this plan, the Board of Directors approved the divestiture of the properties for this school and therefore the properties are included in held for sale as of December 31, 2016.
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6 |
On February 27, 2015, our Board of Directors approved a plan to cease operations at this school, which was fully taught out and officially closed as of March 31, 2016 and is included in the Transitional segment and continuing operations as of December 31, 2016. The plan to teach out this school was approved prior to the plan to exit the HOPS segment and as such does not meet the discontinued operations criteria.
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Current Programs Offered
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||||||
Area of Study
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Bachelor's
Degree
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Associate's Degree
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Diploma and Certificate
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|||
Automotive
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Automotive Service Management, Automotive Technology, Collision Repair & Refinishing Service Management, Diesel & Truck Service Management
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Automotive Mechanics, Automotive Technology, Automotive Technology with BMW FastTrack, Automotive Technology with Mopar X-Press, Automotive Technology with High Performance, Collision Repair and Refinishing Technology, Diesel & Truck Mechanics, Diesel & Truck Technology, Diesel & Truck Technology with Transport Refrigeration, Diesel & Truck with Automotive Technology, Heavy Equipment Maintenance Technology, Heavy Equipment and Truck Technology
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Health Sciences
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Health Information Administration, RN to BSN
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Medical Assisting Technology, Dental Office Management, Health Information Technology, Medical Office Management, Mortuary Science, Occupational Therapy Assistant, Dental Hygiene, Dental Administrative Assistant, Advanced Medical Coding & Billing
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Medical Office Assistant, Medical Assistant, Patient Care Technician, Pharmacy Technician, Medical Coding & Billing, Dental Assistant, Licensed Practical Nursing
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Skilled Trades
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Electronic Engineering Technology, HVAC, Electronics Systems Service Management
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Electrical Technology & Electronic Systems Technology, Electrical Technology, Electronics Systems Technician, HVAC, Welding Technology, CNC
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Hospitality Services
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Culinary Arts, Cosmetology, Aesthetics, International Baking and Pastry, Nail Technolgy, Therapeutic Massage & Bodywork Technician
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Business and Information Technology
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Business Management,
Criminal Justice, Funeral
Service Management
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Criminal Justice, Business Management, Broadcasting and Communications, Paralegal, Computer Networking and Support, Human Services
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Criminal Justice, Computer & Network Support Technician
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School
|
Last Accreditation Letter
|
Next Accreditation
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Type of Accreditation
|
|||
Philadelphia, PA2
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September 30, 2013
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May 1, 2018
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National
|
|||
Union, NJ1
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May 29, 2014
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February 1, 2019
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National
|
|||
Mahwah, NJ1
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March 11, 2015
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August 1, 2019
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National
|
|||
Melrose Park, IL2
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March 13, 2015
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November 1, 2019
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National
|
|||
Denver, CO1
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June 14, 2016
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February 1, 2021
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National
|
|||
Columbia, MD
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March 8, 2017
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February 1, 2022
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National
|
|||
Grand Prairie, TX1
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December 7, 2011
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August 1, 20163
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National
|
|||
Allentown, PA2
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March 8, 2017
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February 1, 2022
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National
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|||
Nashville, TN1
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November 30, 2012
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May 1, 2017
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National
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|||
Indianapolis, IN
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November 30, 2012
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November 1, 20173
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National
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|||
New Britain, CT
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June 5, 2014
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January 1, 2018
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National
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|||
Shelton, CT2
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March 5, 2014
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September 1, 2018
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National
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|||
Queens, NY1
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June 4, 2013
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June 1, 2018
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National
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|||
East Windsor, CT2
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December 4, 2013
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February 1, 20183
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National
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|||
South Plainfield, NJ1
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September 2, 2014
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August 1, 2019
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National
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1 |
Branch campus of main campus in Indianapolis, IN
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2 |
Branch campus of main campus in New Britain, CT
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3 |
Campus undergoing re-accreditation. Campus has received written confirmation that it remains accredited pending consideration of its application for reaccreditation.
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School
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Last Accreditation Letter
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Next Accreditation
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Type of Accreditation
|
|||
Brockton, MA1
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August 28, 2014
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December 31, 2020
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National
|
|||
Lincoln, RI1
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August 28, 2014
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December 31, 2019
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National
|
|||
Lowell, MA1
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January 5, 2015
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December 31, 2019
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National
|
|||
Somerville, MA1
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August 28, 2014
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December 31, 2019
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National
|
|||
Philadelphia (Center City), PA1
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Sepember 14, 2016
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August 31, 2017
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National
|
|||
Iselin, NJ
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December 20, 2016
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December 31, 2022
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National
|
|||
Marietta, GA1
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August 28, 2014
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December 31, 2019
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National
|
|||
Moorestown, NJ1
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December 20, 2016
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December 31, 2022
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National
|
|||
Paramus, NJ1
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December 20, 2016
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December 31, 2022
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National
|
|||
Philadelphia (Northeast), PA1
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December 20, 2016
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December 31, 2022
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National
|
|||
West Palm Beach, FL1
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August 28, 2014
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December 31, 2019
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National
|
|||
Las Vegas (Summerlin), NV1
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August 29, 2014
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December 31, 2019
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National
|
1 |
Branch campus of main campus in Iselin, NJ
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2 |
Campus undergoing re-accreditation.
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School
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Last Accreditation Letter
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Comprehensive Evaluation
|
Type of Accreditation
|
|||
Southington, CT
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June 29, 2012
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Fall 2017
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Regional
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Main Institution/Campus(es)
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Additional Location(s)
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Iselin, NJ
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Moorestown, NJ
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Paramus, NJ
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Philadelphia, PA (Center City)
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||
Philadelphia, PA (Northeast)
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||
Somerville, MA
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Lowell, MA
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Brockton, MA
|
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Lincoln, RI
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Marietta, GA
|
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West Palm Beach, FL
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Las Vegas, NV (Summerlin)
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||
New Britain, CT
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Shelton, CT
|
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Philadelphia, PA
|
||
East Windsor, CT
|
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Melrose Park, IL
|
||
Allentown, PA
|
||
Indianapolis, IN
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Grand Prairie, TX
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Nashville, TN
|
||
Denver, CO
|
||
Union, NJ
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Mahwah, NJ
|
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Queens, NY
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South Plainfield, NJ
|
||
Columbia, MD
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||
Southington, CT
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Institution
|
Expiration Date of Current
Program Participation
Agreement
|
|
Columbia, MD
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September 30, 2017
|
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Iselin, NJ
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June 12, 20181
|
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Indianapolis, IN
|
September 30, 20161 2
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New Britain, CT
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March 31, 2020
|
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Southington, CT
|
June 30, 2017
|
1 |
Provisionally certified.
|
2 |
Month-to-month certification during review process.
|
· |
establishing new processes, and updating existing processes, for enabling borrowers to obtain from the DOE a discharge of some or all of their federal student loans based on circumstances such as certain acts or omissions of the institution and for the DOE to impose and collect liabilities against the institution following the loan discharges;
|
· |
establishing expanded standards of financial responsibility (see “Regulatory Environment – Financial Responsibility Standards”);
|
· |
requiring institutions to make disclosures to current and prospective students regarding the existence of certain of the circumstances identified in the expanded standards of financial responsibility;
|
· |
calculating a loan repayment rate for each proprietary institution under standards established by the regulations and requiring institutions to provide warnings to current and prospective students if the institution has a loan repayment rate below specified thresholds;
|
· |
prohibiting certain contractual provisions imposed by or on behalf of schools on students regarding arbitration, dispute resolution, and participation in class actions; and
|
· |
expanding the existing definition of misrepresentations that could result in grounds for discharge of student loans and in liabilities and sanctions against the institution, including, without limitation, potential loss of Title IV eligibility.
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·
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The equity ratio, which measures the institution's capital resources, ability to borrow and financial viability;
|
· |
The primary reserve ratio, which measures the institution's ability to support current operations from expendable resources; and
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· |
The net income ratio, which measures the institution's ability to operate at a profit.
|
· |
Posting a letter of credit in an amount equal to at least 50% of the total Title IV Program funds received by the institution during the institution's most recently completed fiscal year;
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· |
Posting a letter of credit in an amount equal to at least 10% of such prior year's Title IV Program funds, accepting provisional certification, complying with additional DOE monitoring requirements and agreeing to receive Title IV Program funds under an arrangement other than the DOE's standard advance funding arrangement
|
· |
Comply with all applicable federal student financial aid requirements;
|
· |
Have capable and sufficient personnel to administer the federal student Title IV Programs;
|
· |
Administer Title IV Programs with adequate checks and balances in its system of internal controls over financial reporting;
|
· |
Divide the function of authorizing and disbursing or delivering Title IV Program funds so that no office has the responsibility for both functions;
|
· |
Establish and maintain records required under the Title IV regulations;
|
· |
Develop and apply an adequate system to identify and resolve discrepancies in information from sources regarding a student’s application for financial aid under Title IV;
|
· |
Have acceptable methods of defining and measuring the satisfactory academic progress of its students;
|
· |
Refer to the Office of the Inspector General any credible information indicating that any applicant, student, employee, third party servicer or other agent of the school has been engaged in any fraud or other illegal conduct involving Title IV Programs;
|
· |
Not be, and not have any principal or affiliate who is, debarred or suspended from federal contracting or engaging in activity that is cause for debarment or suspension;
|
· |
Provide adequate financial aid counseling to its students;
|
· |
Submit in a timely manner all reports and financial statements required by the regulations; and
|
· |
Not otherwise appear to lack administrative capability.
|
· |
establishing new processes, and updating existing processes, for enabling borrowers to obtain from the DOE a discharge of some or all of their federal student loans based on circumstances such as certain acts or omissions of the institution and for the DOE to impose and collect liabilities against the institution following the loan discharges;
|
· |
establishing expanded standards of financial responsibility (see “Financial Responsibility Standards”);
|
· |
requiring institutions to make disclosures to current and prospective students regarding the existence of certain of the circumstances identified in the expanded standards of financial responsibility;
|
· |
calculating a loan repayment rate for each proprietary institution under standards established by the regulations and requiring institutions to provide warnings to current and prospective students if the institution has a loan repayment rate below specified thresholds;
|
· |
prohibiting certain contractual provisions imposed by or on behalf of schools on students regarding arbitration, dispute resolution, and participation in class actions; and
|
· |
expanding the existing definition of misrepresentations that could result in grounds for discharge of student loans and in liabilities and sanctions against the institution, including, without limitation, potential loss of Title IV eligibility.
|
· |
Student dissatisfaction with our programs and services;
|
· |
Diminished access to high school student populations;
|
· |
Our failure to maintain or expand our brand or other factors related to our marketing or advertising practices; and
|
· |
Our inability to maintain relationships with employers in the automotive, diesel, skilled trades and IT services industries.
|
· |
authorize the issuance of blank check preferred stock that could be issued by our board of directors to thwart a takeover attempt;
|
· |
prohibit cumulative voting in the election of directors, which would otherwise allow holders of less than a majority of stock to elect some directors;
|
· |
require super-majority voting to effect amendments to certain provisions of our amended and restated certificate of incorporation;
|
· |
limit who may call special meetings of both the board of directors and stockholders;
|
· |
prohibit stockholder action by non-unanimous written consent and otherwise require all stockholder actions to be taken at a meeting of the stockholders;
|
· |
establish advance notice requirements for nominating candidates for election to the board of directors or for proposing matters that can be acted upon by stockholders at stockholders' meetings; and
|
· |
require that vacancies on the board of directors, including newly created directorships, be filled only by a majority vote of directors then in office.
|
Location
|
Brand
|
Approximate Square Footage
|
||
Henderson, Nevada
|
Euphoria Institute
|
18,000
|
||
Las Vegas, Nevada
|
Euphoria Institute
|
19,000
|
||
Southington, Connecticut
|
Lincoln College of New England
|
113,000
|
||
Columbia, Maryland
|
Lincoln College of Technology
|
110,000
|
||
Denver, Colorado
|
Lincoln College of Technology
|
212,000
|
||
Grand Prairie, Texas
|
Lincoln College of Technology
|
146,000
|
||
Indianapolis, Indiana
|
Lincoln College of Technology
|
189,000
|
||
Marietta, Georgia
|
Lincoln College of Technology
|
30,000
|
||
Melrose Park, Illinois
|
Lincoln College of Technology
|
88,000
|
||
West Palm Beach, Florida
|
Lincoln College of Technology
|
117,000
|
||
Allentown, Pennsylvania
|
Lincoln Technical Institute
|
26,000
|
||
Brockton, Massachusetts
|
Lincoln Technical Institute
|
22,000
|
||
East Windsor, Connecticut
|
Lincoln Technical Institute
|
289,000
|
||
Iselin, New Jersey
|
Lincoln Technical Institute
|
32,000
|
||
Lincoln, Rhode Island
|
Lincoln Technical Institute
|
39,000
|
||
Lowell, Massachusetts
|
Lincoln Technical Institute
|
21,000
|
||
Mahwah, New Jersey
|
Lincoln Technical Institute
|
79,000
|
||
Moorestown, New Jersey
|
Lincoln Technical Institute
|
35,000
|
||
New Britain, Connecticut
|
Lincoln Technical Institute
|
35,000
|
||
Northeast Philadelphia, Pennsylvania
|
Lincoln Technical Institute
|
25,000
|
||
Paramus, New Jersey
|
Lincoln Technical Institute
|
30,000
|
||
Philadelphia, Pennsylvania
|
Lincoln Technical Institute
|
36,000
|
||
Philadelphia, Pennsylvania
|
Lincoln Technical Institute
|
29,000
|
||
Queens, New York
|
Lincoln Technical Institute
|
48,000
|
||
Shelton, Connecticut
|
Lincoln Technical Institute
|
47,000
|
||
Somerville, Massachusetts
|
Lincoln Technical Institute
|
33,000
|
||
South Plainfield, New Jersey
|
Lincoln Technical Institute
|
60,000
|
||
Union, New Jersey
|
Lincoln Technical Institute
|
56,000
|
||
Nashville, Tennessee
|
Lincoln College of Technology
|
281,000
|
||
West Orange, New Jersey
|
Corporate Office
|
52,000
|
||
Plymouth Meeting, Pennsylvania
|
Corporate Office
|
6,000
|
||
Suffield, Connecticut
|
132,000
|
ITEM 5. |
Price Range of Common Stock
|
||||||||||||
High
|
Low
|
Dividend
|
||||||||||
Fiscal Year Ended December 31, 2016
|
||||||||||||
First Quarter
|
$
|
3.05
|
$
|
1.92
|
$
|
-
|
||||||
Second Quarter
|
$
|
2.49
|
$
|
1.37
|
$
|
-
|
||||||
Third Quarter
|
$
|
2.58
|
$
|
1.37
|
$
|
-
|
||||||
Fourth Quarter
|
$
|
2.20
|
$
|
1.58
|
$
|
-
|
Price Range of Common Stock
|
||||||||||||
High
|
Low
|
Dividend
|
||||||||||
Fiscal Year Ended December 31, 2015
|
||||||||||||
First Quarter
|
$
|
3.10
|
$
|
2.08
|
$
|
-
|
||||||
Second Quarter
|
$
|
2.71
|
$
|
1.93
|
$
|
-
|
||||||
Third Quarter
|
$
|
1.93
|
$
|
0.20
|
$
|
-
|
||||||
Fourth Quarter
|
$
|
2.40
|
$
|
0.53
|
$
|
-
|
Plan Category
|
Number of
Securities to be
issued upon
exercise of
outstanding
options,
warrants and
rights
|
Weighted-
average
exercise
price of
outstanding
options,
warrants and
rights
|
Number of
securities
remaining
available for
future issuance
under equity
compensation
plans (excluding
securities
reflected in
column (a))
|
|||||||||
(a)
|
||||||||||||
Equity compensation plans approved by security holders
|
218,167
|
$
|
12.11
|
2,315,016
|
||||||||
Equity compensation plans not approved by security holders
|
-
|
-
|
-
|
|||||||||
Total
|
218,167
|
$
|
12.11
|
2,315,016
|
2016
|
2015
|
2014
|
2013
|
2012
|
||||||||||||||||
(In thousands, except per share amounts)
|
||||||||||||||||||||
Statement of Operations Data, Year Ended December 31:
|
||||||||||||||||||||
Revenue
|
$
|
196,910
|
$
|
208,256
|
$
|
218,040
|
$
|
225,742
|
$
|
248,724
|
||||||||||
Cost and expenses:
|
||||||||||||||||||||
Educational services and facilities
|
94,922
|
94,970
|
103,299
|
104,330
|
111,008
|
|||||||||||||||
Selling, general and administrative
|
103,129
|
105,380
|
116,573
|
122,253
|
133,158
|
|||||||||||||||
Loss (gain) on sale of assets
|
120
|
1,741
|
(58
|
)
|
(279
|
)
|
(70
|
)
|
||||||||||||
Impairment of goodwill and long-lived assets
|
3,902
|
216
|
21,885
|
1,701
|
10,739
|
|||||||||||||||
Total costs and expenses
|
202,073
|
202,307
|
241,699
|
228,005
|
254,835
|
|||||||||||||||
Operating (loss) income
|
(5,163
|
)
|
5,949
|
(23,659
|
)
|
(2,263
|
)
|
(6,111
|
)
|
|||||||||||
Other:
|
||||||||||||||||||||
Interest income
|
155
|
52
|
62
|
37
|
2
|
|||||||||||||||
Interest expense
|
(6,001
|
)
|
(5,727
|
)
|
(3,431
|
)
|
(2,507
|
)
|
(2,293
|
)
|
||||||||||
Other income
|
6,711
|
109
|
-
|
18
|
14
|
|||||||||||||||
(Loss) income from continuing operations before income taxes
|
(4,298
|
)
|
383
|
(27,028
|
)
|
(4,715
|
)
|
(8,388
|
)
|
|||||||||||
Provision (benefit) for income taxes (1)
|
200
|
242
|
(1,479
|
)
|
19,830
|
(1,333
|
)
|
|||||||||||||
(Loss) income from continuing operations
|
(4,498
|
)
|
141
|
(25,549
|
)
|
(24,545
|
)
|
(7,055
|
)
|
|||||||||||
Loss from discontinued operations, net of income taxes
|
(23,806
|
)
|
(3,491
|
)
|
(30,584
|
)
|
(26,741
|
)
|
(30,131
|
)
|
||||||||||
Net loss
|
$
|
(28,304
|
)
|
$
|
(3,350
|
)
|
$
|
(56,133
|
)
|
$
|
(51,286
|
)
|
$
|
(37,186
|
)
|
|||||
Basic
|
||||||||||||||||||||
(Loss) earnings per share from continuing operations
|
$
|
(0.19
|
)
|
$
|
0.01
|
$
|
(1.12
|
)
|
$
|
(1.09
|
)
|
$
|
(0.32
|
)
|
||||||
Loss per share from discontinued operations
|
(1.02
|
)
|
(0.15
|
)
|
(1.34
|
)
|
(1.19
|
)
|
(1.36
|
)
|
||||||||||
Net loss per share
|
$
|
(1.21
|
)
|
$
|
(0.14
|
)
|
$
|
(2.46
|
)
|
$
|
(2.28
|
)
|
$
|
(1.68
|
)
|
|||||
Diluted
|
||||||||||||||||||||
(Loss) earnings per share from continuing operations
|
$
|
(0.19
|
)
|
$
|
0.01
|
$
|
(1.12
|
)
|
$
|
(1.09
|
)
|
$
|
(0.32
|
)
|
||||||
Loss per share from discontinued operations
|
(1.02
|
)
|
(0.15
|
)
|
(1.34
|
)
|
(1.19
|
)
|
(1.36
|
)
|
||||||||||
Net loss per share
|
$
|
(1.21
|
)
|
$
|
(0.14
|
)
|
$
|
(2.46
|
)
|
$
|
(2.28
|
)
|
$
|
(1.68
|
)
|
|||||
Weighted average number of common shares outstanding:
|
||||||||||||||||||||
Basic
|
23,453
|
23,167
|
22,814
|
22,513
|
22,195
|
|||||||||||||||
Diluted
|
23,453
|
23,227
|
22,814
|
22,513
|
22,195
|
|||||||||||||||
Other Data:
|
||||||||||||||||||||
Capital expenditures
|
$
|
3,596
|
$
|
2,218
|
$
|
7,472
|
$
|
6,538
|
$
|
8,839
|
||||||||||
Depreciation and amortization from continuing operations
|
10,975
|
10,346
|
14,589
|
14,590
|
15,787
|
|||||||||||||||
Number of campuses
|
28
|
31
|
31
|
33
|
33
|
|||||||||||||||
Average student population from continuing operations (2)
|
7,725
|
8,395
|
9,037
|
9,178
|
10,083
|
|||||||||||||||
Cash dividend declared per common share
|
$
|
-
|
$
|
-
|
$
|
0.18
|
$
|
0.28
|
$
|
0.28
|
||||||||||
Balance Sheet Data, At December 31:
|
||||||||||||||||||||
Cash, cash equivalents and restricted cash
|
$
|
47,715
|
$
|
61,041
|
$
|
42,299
|
$
|
67,386
|
$
|
61,708
|
||||||||||
Working (deficit) capital (3)
|
(1,733
|
)
|
33,818
|
29,585
|
47,041
|
40,939
|
||||||||||||||
Total assets
|
163,207
|
210,279
|
213,707
|
305,949
|
346,774
|
|||||||||||||||
Total debt (4)
|
41,957
|
58,224
|
65,181
|
90,116
|
73,527
|
|||||||||||||||
Total stockholders' equity
|
54,926
|
80,997
|
83,010
|
145,196
|
198,477
|
|
|
Segment
|
|
Status
|
|
||||
School
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
Allentown, PA
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Edison, NJ
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Moorestown, NJ
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Paramus, NJ
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Lincoln, RI
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Brockton, MA
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Somerville, MA
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Lowell, MA
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
New Britain, CT
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Shelton, CT
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Las Vegas (Summerlin), NV
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Southington, CT
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Marietta, GA
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Hartford, CT
|
|
Transitional (Continuing Operations)
|
|
HOPS (Discontinued Operations)
|
|
Teach-out
|
|
Closed
|
2
|
Henderson (Green Valley), NV
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Closed
|
3
|
Center City Philadelphia, PA
|
|
HOPS (Discontinued Operations)
|
|
Transitional (Continuing Operations)
|
|
Held for sale
|
|
Teach-out
|
4
|
Northeast Philadelphia, PA
|
|
HOPS (Discontinued Operations)
|
|
Transitional (Continuing Operations)
|
|
Held for sale
|
|
Teach-out
|
4
|
West Palm Beach, FL
|
|
HOPS (Discontinued Operations)
|
|
Transitional (Continuing Operations)
|
|
Held for sale
|
|
Teach-out
|
5
|
Fern Park, FL
|
|
Transitional (Continuing Operations)
|
|
Transitional (Continuing Operations)
|
|
Teach-out
|
|
Closed
|
6
|
1 |
In November 2015, the Board of Directors approved a plan to divest these schools and thus they are included in discontinued operations as of December 31, 2016 and 2015.
|
2 |
In November 2015, the Board of Directors approved a plan to divest this school. In December 2015, the Board of Directors approved a plan to cease operations at this school. The school was included in the Transitional Segment and included in continuing operations until it closed in the fourth quarter of 2016; it is included in discontinued operations as of December 31, 2016.
|
3 |
In November 2015, the Board of Directors approved a plan to divest this school. In the fourth quarter of 2016, the Board of Directors approved a plan to cease operations at this school, which closed in the fourth quarter of 2016 and is included in discontinued operations as of December 31, 2016.
|
4 |
In November 2015, the Board of Directors approved a plan to divest these schools. In the fourth quarter of 2016, the Board of Directors approved a plan to cease operations at these schools which are being taught-out and expected to be closed in 2017. These schools are included in the Transitional segment and continuing operations as of December 31, 2016.
|
5 |
In November 2015, the Board of Directors approved a plan to divest this school. In the third quarter of 2016, the Board of Directors approved a plan to teach–out certain programs at this school. Then, in the fourth quarter of 2016, the Board of Directors approved a plan to teach-out the remainder of the programs at this school. The school is expected to be closed in 2017. This school’s operations are included in the Transitional segment and continuing operations as of December 31, 2016. However, as part of this plan, the Board of Directors approved the divestiture of the properties for this school and therefore the properties are included in held for sale as of December 31, 2016.
|
6 |
On February 27, 2015, our Board of Directors approved a plan to cease operations at this school, which was fully taught out and officially closed as of March 31, 2016 and is included in the Transitional segment and continuing operations as of December 31, 2016. The plan to teach out this school was approved prior to the plan to exit the HOPS segment and as such does not meet the discontinued operations criteria.
|
· |
Our internal financing is provided to students only after all other funding resources have been exhausted; thus, by the time this funding is available, students have completed approximately two-thirds of their curriculum and are more likely to graduate;
|
· |
Funding for students who interrupt their education is typically covered by Title IV funds as long as they have been properly packaged for financial aid; and
|
· |
Creditworthy criteria to demonstrate a student’s ability to pay.
|
· |
Educational services and facilities. Major components of educational services and facilities expenses include faculty compensation and benefits, expenses of books and tools, facility rent, maintenance, utilities, depreciation and amortization of property and equipment used in the provision of education services and other costs directly associated with teaching our programs excluding student services which is included in selling, general and administrative expenses.
|
· |
Selling, general and administrative. Selling, general and administrative expenses include compensation and benefits of employees who are not directly associated with the provision of educational services (such as executive management and school management, finance and central accounting, legal, human resources and business development), marketing and student enrollment expenses (including compensation and benefits of personnel employed in sales and marketing and student admissions), costs to develop curriculum, costs of professional services, bad debt expense, rent for our corporate headquarters, depreciation and amortization of property and equipment that is not used in the provision of educational services and other costs that are incidental to our operations. Selling, general and administrative expenses also includes the cost of all student services including financial aid and career services. All marketing and student enrollment expenses are recognized in the period incurred.
|
Year Ended December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Revenue
|
$
|
88,649
|
$
|
97,846
|
$
|
106,982
|
||||||
Loss before income tax
|
(6,341
|
)
|
(3,491
|
)
|
(26,684
|
)
|
||||||
Income tax benefit
|
-
|
-
|
(2,746
|
)
|
||||||||
Net loss from discontinued operations
|
$
|
(6,341
|
)
|
$
|
(3,491
|
)
|
$
|
(23,938
|
)
|
Year Ended December 31,
|
||||
2014
|
||||
Revenue
|
$
|
2,140
|
||
Loss before income tax
|
(6,731
|
)
|
||
Income tax benefit
|
(85
|
)
|
||
Net loss from discontinued operations
|
$
|
(6,646
|
)
|
Year Ended December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Revenue
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
||||||
Costs and expenses:
|
||||||||||||
Educational services and facilities
|
48.2
|
%
|
45.6
|
%
|
47.4
|
%
|
||||||
Selling, general and administrative
|
52.4
|
%
|
50.6
|
%
|
53.5
|
%
|
||||||
Gain on sale of assets
|
0.1
|
%
|
0.8
|
%
|
0.0
|
%
|
||||||
Impairment of goodwill and long-lived assets
|
1.9
|
%
|
0.1
|
%
|
10.0
|
%
|
||||||
Total costs and expenses
|
102.6
|
%
|
97.1
|
%
|
110.9
|
%
|
||||||
Operating (loss) income
|
-2.6
|
%
|
2.9
|
%
|
-10.9
|
%
|
||||||
Interest expense, net
|
-3.0
|
%
|
-2.7
|
%
|
-1.5
|
%
|
||||||
Other income (loss)
|
3.4
|
%
|
0.0
|
%
|
0.0
|
%
|
||||||
(Loss) income from continuing opeartions before income taxes
|
-2.2
|
%
|
0.2
|
%
|
-12.4
|
%
|
||||||
Provision (benefit) for income taxes
|
0.1
|
%
|
0.1
|
%
|
-1.9
|
%
|
||||||
(Loss) income from continuing operations
|
-2.3
|
%
|
0.1
|
%
|
-10.5
|
%
|
Twelve Months Ended December 31,
|
||||||||||||
2016
|
2015
|
% Change
|
||||||||||
Revenue:
|
||||||||||||
Transportation and Skilled Trades
|
$
|
177,882
|
$
|
183,821
|
-3.2
|
%
|
||||||
Transitional
|
19,028
|
24,435
|
-22.1
|
%
|
||||||||
Total
|
$
|
196,910
|
$
|
208,256
|
-5.4
|
%
|
||||||
Operating Income (Loss):
|
||||||||||||
Transportation and Skilled Trades
|
$
|
21,278
|
$
|
26,778
|
-20.5
|
%
|
||||||
Transitional
|
(6,334
|
)
|
(1,689
|
)
|
-275.0
|
%
|
||||||
Corporate
|
(20,107
|
)
|
(19,140
|
)
|
-5.1
|
%
|
||||||
Total
|
$
|
(5,163
|
)
|
$
|
5,949
|
186.8
|
%
|
|||||
Starts:
|
||||||||||||
Transportation and Skilled Trades
|
7,626
|
7,794
|
-2.2
|
%
|
||||||||
Transitional
|
838
|
1,227
|
-31.7
|
%
|
||||||||
Total
|
8,464
|
9,021
|
-6.2
|
%
|
||||||||
Average Population:
|
||||||||||||
Transportation and Skilled Trades
|
6,852
|
7,238
|
-5.3
|
%
|
||||||||
Transitional
|
873
|
1,157
|
-24.5
|
%
|
||||||||
Total
|
7,725
|
8,395
|
-8.0
|
%
|
||||||||
End of Period Population:
|
||||||||||||
Transportation and Skilled Trades
|
6,700
|
6,617
|
1.3
|
%
|
||||||||
Transitional
|
595
|
928
|
-35.9
|
%
|
||||||||
Total
|
7,295
|
7,545
|
-3.3
|
%
|
· |
Revenue decreased to $177.9 million for the year ended December 31, 2016, as compared to $183.8 million in the comparable period, primarily driven by a 5.3% decrease in average student population, which decreased to approximately 6,900 from 7,200 in the prior comparable year. The decrease in average population was a result of starting 2016 with approximately 600 fewer students than we had on January 1, 2015. The revenue decline from a lower population was slightly offset by a 2.2% increase in average revenue per student due to a shift in program mix.
|
· |
Educational services and facilities expense increased by $1.9 million mainly due to a $2.0 million, or 5.9%, increase in facilities expense primarily due to (a) increased rent expense of $1.3 million which was the result of a modification of a lease at three of our campuses which were previously accounted for as finance obligations under which rent payments were previously included in interest expense; (b) $0.6 million in additional depreciation expense resulting from the reclassification of one of our facilities out of held for sale as of December 31, 2015; and (c) a $1.5 million, or 17.4% increase in books and tools expenses resulting from the purchase of laptops provided to newly enrolled students in certain programs to enhance and expand their overall learning experience. Partially offsetting the above increases was a $1.6 million, or 4.1%, decrease in instructional expense as a result of realigning our cost structure to meet our population.
|
· |
Selling, general and administrative expenses decreased by $0.5 million primarily as a result of a $1.6 million decrease in administrative and student services expense due to reduced salary and benefits. Partially offsetting the decrease was a $1.1 million increase in marketing expense which was largely the result of additional spending in a strategic effort to reach more potential students, expand brand awareness and increase enrollments.
|
· |
Loss on sale of asset decreased by $1.6 million as a result of a one-time charge in relation to one of our campuses that previously classified as held for sale. During 2015 the company had reclassified this campus out of held for sale and recorded catch-up depreciation in the amount of $1.6 million.
|
· |
Impairment of goodwill and long lived asset decreased by $0.2 million as a result of one-time charges in relation to one of our campuses during the year ended December 31, 2015.
|
Year Ended December 31,
|
||||||||||||
2015
|
2014
|
% Change
|
||||||||||
Revenue:
|
||||||||||||
Transportation and Skilled Trades
|
$
|
183,821
|
$
|
188,669
|
-2.6
|
%
|
||||||
Transitional
|
24,435
|
29,371
|
-16.8
|
%
|
||||||||
Total
|
$
|
208,256
|
$
|
218,040
|
-4.5
|
%
|
||||||
Operating Income (Loss):
|
||||||||||||
Transportation and Skilled Trades
|
$
|
26,778
|
$
|
19,519
|
37.2
|
%
|
||||||
Transitional
|
(1,689
|
)
|
(19,814
|
)
|
91.5
|
%
|
||||||
Corporate
|
(19,140
|
)
|
(23,364
|
)
|
18.1
|
%
|
||||||
Total
|
$
|
5,949
|
$
|
(23,659
|
)
|
125.1
|
%
|
|||||
Starts:
|
||||||||||||
Transportation and Skilled Trades
|
7,794
|
8,289
|
-6.0
|
%
|
||||||||
Transitional
|
1,227
|
1,661
|
-26.1
|
%
|
||||||||
Total
|
9,021
|
9,950
|
-9.3
|
%
|
||||||||
Average Population:
|
||||||||||||
Transportation and Skilled Trades
|
7,238
|
7,603
|
-4.8
|
%
|
||||||||
Transitional
|
1,157
|
1,434
|
-19.3
|
%
|
||||||||
Total
|
8,395
|
9,037
|
-7.1
|
%
|
||||||||
End of Period Population:
|
||||||||||||
Transportation and Skilled Trades
|
6,617
|
7,210
|
-8.2
|
%
|
||||||||
Transitional
|
928
|
1,270
|
-26.9
|
%
|
||||||||
Total
|
7,545
|
8,480
|
-11.0
|
%
|
· |
Revenue decreased to $183.8 million for the year ended December 31, 2015, as compared to $188.7 million in the comparable period, primarily driven by a 4.8% decline in average student population, which decreased to approximately 7,200 from 7,600 in the prior comparable year. In addition, we had fewer new starts of 495 which decreased our new student population to 7,794 for the year ended December 31, 2015 from 8,289 for the year ended December 31, 2014. The revenue decline from lower population was slightly offset by a 2.3% increase in average revenue per student due to improved student retention and a shift in program mix. In addition, revenue was lower in 2015 due to higher scholarship recognition in comparison to 2014. Scholarships are recognized ratably over the term of the student’s program. Scholarship discounts increased by $0.7 million for the year ended December 31, 2015 as compared to the prior year. While scholarships have negatively impacted revenue, we believe we provide more students with the opportunity to pursue their educational goals by assisting in their affordability challenge
|
· |
Educational services and facilities expense reduced by $6.5 million comprised of: (a) $3.7 million, or 9.8%, reduction in facilities expense, primarily due to lower depreciation expense as a result of discontinued depreciation for one campus included in assets held for sale and lower asset base due to prior long-lived asset impairments; and (b) lower instructional expenses of $2.4 million, or 5.8%, and books and tools expense of $0.4 million, or 4.7% as a result of lower student population.
|
· |
Selling, general and administrative expenses reduced by $5.7 million comprised of: (a) $2.6 million, or 11.8%, reduction in sales expenses offset by a $0.8 million, or 5.9%, increase in marketing. The decrease in sales expense was attributable to a reduction in the number of admissions representatives dedicated to the destination schools replaced with a centralized call center thus reducing travel costs and salary expense, while the marketing increase was a result of increased spending on production costs associated with our new marketing campaign as “Lincoln Tech, America’s Technical Institute”; (b) $1.1 million reduction in student services driven by lower student population; and (c) $2.8 million, or 8.2%, reduction in administrative expenses primarily as a result of a reduction in bad debt expense. The improvement in bad debt expense was mainly the result of improvement in current collections and collections history.
|
· |
Gain on sale of assets increased by $1.6 million as a result of a non-cash charge in relation to one of our campuses that was previously classified as held for sale in 2014. During 2015 the Company had re-classified this campus out of held for sale and recorded catch-up depreciation in the amount of $1.6 million.
|
· |
Impairment of goodwill and long-lived assets of $0.2 million compared to $1.7 million for the years ended December 31, 2015 and 2014, respectively.
|
Year Ended December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
(In thousands)
|
||||||||||||
Net cash (used in)provided by operating activities
|
$
|
(6,107
|
)
|
$
|
14,337
|
$
|
12,022
|
|||||
Net cash used in investing activities
|
$
|
(2,182
|
)
|
$
|
(1,767
|
)
|
$
|
(7,405
|
)
|
|||
Net cash (used in) provided by financing activities
|
$
|
(9,067
|
)
|
$
|
13,551
|
$
|
(5,204
|
)
|
As of December 31,
|
||||||||
2016
|
2015
|
|||||||
Term loan
|
$
|
44,267
|
$
|
44,653
|
||||
Finance obligation
|
-
|
9,672
|
||||||
Capital lease-property (with a rate of 8.0%)
|
-
|
3,899
|
||||||
Subtotal
|
44,267
|
58,224
|
||||||
Less current maturities
|
(11,713
|
)
|
(10,114
|
)
|
||||
Total long-term debt
|
$
|
32,554
|
$
|
48,110
|
Payments Due by Period
|
||||||||||||||||||||
Total
|
Less than
1 year
|
1-3 years
|
3-5 years
|
More than
5 years
|
||||||||||||||||
Credit agreement (including interest)
|
$
|
53,887
|
$
|
16,048
|
$
|
37,839
|
$
|
-
|
$
|
-
|
||||||||||
Operating leases
|
97,206
|
21,428
|
35,653
|
19,641
|
20,484
|
|||||||||||||||
Total contractual cash obligations
|
$
|
151,093
|
$
|
37,476
|
$
|
73,492
|
$
|
19,641
|
$
|
20,484
|
ITEM 12. |
1. |
Financial Statements
|
2. |
Financial Statement Schedule
|
3. |
Exhibits Required by Securities and Exchange Commission Regulation S-K
|
Exhibit
Number
|
Description
|
3.1
|
Amended and Restated Certificate of Incorporation of the Company (1).
|
3.2
|
By-laws of the Company (2).
|
4.1
|
Management Stockholders Agreement, dated as of January 1, 2002, by and among Lincoln Technical Institute, Inc., Back to School Acquisition, L.L.C. and the Stockholders and other holders of options under the Management Stock Option Plan listed therein (3).
|
4.2
|
Assumption Agreement and First Amendment to Management Stockholders Agreement, dated as of December 20, 2007, by and among Lincoln Educational Services Corporation, Lincoln Technical Institute, Inc., Back to School Acquisition, L.L.C. and the Management Investors parties therein (4).
|
4.3
|
Registration Rights Agreement, dated as of June 27, 2005, between the Company and Back to School Acquisition, L.L.C. (2).
|
4.4
|
Specimen Stock Certificate evidencing shares of common stock (5).
|
10.1
|
Credit Agreement, dated as of July 31, 2015, among Lincoln Educational Services Corporation and its wholly-owned subsidiaries, the Lenders and Collateral Agents party thereto, and HPF Service, LLC, as Administrative Agent (6).
|
10.2
|
First Amendment to Credit Agreement, dated as of December 31, 2015, among Lincoln Educational Services Corporation and its wholly-owned subsidiaries, the Lenders and Collateral Agents party thereto, and HPF Service, LLC, as Administrative Agent (7).
|
10.3
|
Second Amendment to Credit Agreement, dated as of February 29, 2016, among Lincoln Educational Services Corporation and its wholly-owned subsidiaries, the Lenders party thereto, and HPF Service, LLC, as Administrative Agent and Tranche A Collateral Agent (8).
|
10.4
|
Credit Agreement, dated as of April 12, 2016, among the Company, Lincoln Technical Institute, Inc. and its subsidiaries, and Sterling National Bank (9).
|
10.5
|
Purchase and Sale Agreement, dated as of July 1, 2016, between New England Institute of Technology at Palm Beach, Inc. and School Property Development Metrocentre, LLC (10).
|
10.6
|
Separation and Release Agreement, dated as of May 5, 2015, between the Company and Shaun E. McAlmont (11).
|
10.7
|
Employment Agreement, dated as of January 30, 2015, between the Company and Scott M. Shaw (12).
|
10.8
|
Employment Agreement, dated as of August 31, 2015, between the Company and Scott M. Shaw (13).
|
10.9
|
Employment Agreement, dated as of August 23, 2016, between the Company and Scott M. Shaw (14)
|
10.10
|
Employment Agreement, dated as of June 2, 2014, between the Company and Kenneth M. Swisstack (15).
|
|
10.11
|
Amendment to Employment Agreement, dated as of March 12, 2015, between the Company and Kenneth M. Swisstack. (16)
|
|
10.12
|
Separation and Release Agreement, dated as of January 15, 2016, between the Company and Kenneth M. Swisstack (17).
|
|
10.13
|
Employment Agreement, dated as of March 12, 2015, between the Company and Brian K. Meyers (16).
|
|
10.14
|
Employment Agreement, dated as of August 23, 2016, between the Company and Brian K. Meyers (14).
|
|
10.15*
|
Change in Control Agreement, dated August 31, 2016, between the Company and Deborah Ramentol.
|
|
10.16
|
Lincoln Educational Services Corporation Amended and Restated 2005 Long-Term Incentive Plan (18).
|
|
10.17
|
Lincoln Educational Services Corporation Amended and Restated 2005 Non-Employee Directors Restricted Stock Plan (19).
|
|
10.18
|
Lincoln Educational Services Corporation 2005 Deferred Compensation Plan (3).
|
|
10.19
|
Lincoln Technical Institute Management Stock Option Plan, effective January 1, 2002 (3).
|
|
10.20
|
Form of Stock Option Agreement, dated January 1, 2002, between Lincoln Technical Institute, Inc. and certain participants (3).
|
|
10.21
|
Form of Stock Option Agreement under our 2005 Long-Term Incentive Plan (20).
|
|
10.22
|
Form of Restricted Stock Agreement under our 2005 Long-Term Incentive Plan (21).
|
|
10.23
|
Form of Performance-Based Restricted Stock Award Agreement under our Amended & Restated 2005 Long-Term Incentive Plan (16).
|
|
10.24
|
Management Stock Subscription Agreement, dated January 1, 2002, among Lincoln Technical Institute, Inc. and certain management investors (3).
|
|
21.1*
|
Subsidiaries of the Company.
|
|
23*
|
Consent of Independent Registered Public Accounting Firm.
|
|
24*
|
Power of Attorney (included on the Signatures page of this Form 10-K).
|
|
31.1 *
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
31.2 *
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
32 *
|
Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101**
|
The following financial statements from Lincoln Educational Services Corporation’s Annual Report on Form 10-K for the year ended December 31, 2016, formatted in XBRL: (i) Consolidated Statements of Operations, (ii) Consolidated Balance Sheets, (iii) Consolidated Statements of Cash Flows, (iv) Consolidated Statements of Comprehensive (Loss) Income, (v) Consolidated Statement of Changes in Stockholders’ Equity and (vi) the Notes to Consolidated Financial Statements, tagged as blocks of text and in detail.
|
(1) |
Incorporated by reference to the Company’s Registration Statement on Form S-1/A (Registration No. 333-123644) filed June 7, 2005.
|
(2) |
Incorporated by reference to the Company’s Form 8-K filed June 28, 2005.
|
(3) |
Incorporated by reference to the Company’s Registration Statement on Form S-1 (Registration No. 333-123644) filed March 29, 2005.
|
(4) |
Incorporated by reference to the Company’s Registration Statement on Form S-3 (Registration No. 333-148406) filed December 28, 2007.
|
(5) |
Incorporated by reference to the Company’s Registration Statement on Form S-1/A (Registration No. 333-123644) filed June 21, 2005.
|
(6) |
Incorporated by reference to the Company’s Form 8-K filed August 5, 2015.
|
(7) |
Incorporated by reference to the Company’s Form 8-K filed January 7, 2016.
|
(8) |
Incorporated by reference to the Company’s Form 8-K filed March 4, 2016.
|
(9) |
Incorporated by reference to the Company’s Form 8-K filed April 18, 2016.
|
(10) |
Incorporated by reference to the Company’s Quarterly Report on Form 10-Q filed August 9, 2016.
|
(11) |
Incorporated by reference to the Company’s Form 8-K filed May 6, 2015.
|
(12) |
Incorporated by reference to the Company’s Form 8-K filed February 5, 2015.
|
(13) |
Incorporated by reference to the Company’s Form 8-K filed September 3, 2015.
|
(14) |
Incorporated by reference to the Company’s Form 8-K filed August 25, 2016.
|
(15) |
Incorporated by reference to the Company’s Quarterly Report on Form 10-Q filed August 8, 2014.
|
(16) |
Incorporated by reference to the Company’s Form 10-K for the year ended December 31, 2014.
|
(17) |
Incorporated by reference to the Company’s Form 8-K filed January 22, 2016.
|
(18) |
Incorporated by reference to the Company’s Form 8-K filed May 6, 2013.
|
(19) |
Incorporated by reference to the Company’s Registration Statement on Form S-8 (Registration No. 333-211213) filed May 6, 2016.
|
(20) |
Incorporated by reference to the Company’s Annual Report on Form 10-K for the year ended December 31, 2007.
|
(21) |
Incorporated by reference to the Company’s Annual Report on Form 10-K for the year ended December 31, 2012.
|
(22) |
Incorporated by reference to the Company’s Form 8-K filed May 5, 2011.
|
* |
Filed herewith.
|
** |
As provided in Rule 406T of Regulation S-T, this information is furnished and not filed for purposes of Sections 11 and 12 of the Securities Act of 1933 and Section 18 of the Securities Exchange Act of 1934
|
LINCOLN EDUCATIONAL SERVICES CORPORATION
|
|||
By:
|
/s/ Brian Meyers
|
||
Brian Meyers
|
|||
Executive Vice President, Chief Financial Officer and Treasurer
|
|||
(Principal Accounting and Financial Officer)
|
Signature
|
Title
|
Date
|
||
/s/ Scott M. Shaw
|
Chief Executive Officer and Director
|
March 10, 2017
|
||
Scott M. Shaw
|
||||
/s/ Brian K. Meyers
|
Executive Vice President, Chief Financial Officer and Treasurer
|
March 10, 2017
|
||
Brian K. Meyers
|
(Principal Accounting and Financial Officer) | |||
/s/ Alvin O. Austin
|
Director
|
March 10, 2017
|
||
Alvin O. Austin
|
||||
/s/ Peter S. Burgess
|
Director
|
March 10, 2017
|
||
Peter S. Burgess
|
||||
/s/ James J. Burke, Jr.
|
Director
|
March 10, 2017
|
||
James J. Burke, Jr.
|
||||
/s/ Celia H. Currin
|
Director
|
March 10, 2017
|
||
Celia H. Currin
|
||||
/s/ Ronald E. Harbour
|
Director
|
March 10, 2017
|
||
Ronald E. Harbour
|
||||
/s/ J. Barry Morrow
|
Director
|
March 10, 2017
|
||
J. Barry Morrow
|
Page Number
|
|
Reports of Independent Registered Public Accounting Firm
|
F-2
|
Consolidated Balance Sheets as of December 31, 2016 and 2015
|
F-4
|
Consolidated Statements of Operations for the years ended December 31, 2016, 2015 and 2014
|
F-6
|
Consolidated Statements of Comprehensive (Loss) Income for the years ended December 31, 2016, 2015 and 2014
|
F-7
|
Consolidated Statements of Changes in Stockholders' Equity for the years ended December 31, 2016, 2015 and 2014
|
F-8
|
Consolidated Statements of Cash Flows for the years ended December 31, 2016, 2015 and 2014
|
F-9
|
Notes to Consolidated Financial Statements
|
F-11
|
Schedule II-Valuation and Qualifying Accounts
|
F-34
|
December 31,
|
||||||||
2016
|
2015
|
|||||||
ASSETS
|
||||||||
CURRENT ASSETS:
|
||||||||
Cash and cash equivalents
|
$
|
21,064
|
$
|
38,420
|
||||
Restricted cash
|
6,399
|
7,362
|
||||||
Accounts receivable, less allowance of $9,887 and $9,787 at December 31, 2016 and 2015, respectively
|
10,294
|
10,410
|
||||||
Inventories
|
1,058
|
1,242
|
||||||
Prepaid income taxes and income taxes receivable
|
262
|
349
|
||||||
Assets held for sale
|
24,786
|
44,369
|
||||||
Prepaid expenses and other current assets
|
2,434
|
2,710
|
||||||
Total current assets
|
66,297
|
104,862
|
||||||
PROPERTY, EQUIPMENT AND FACILITIES - At cost, net of accumulated depreciation and amortization of $124,192 and $123,324 at December 31, 2016 and 2015, respectively
|
55,445
|
66,625
|
||||||
OTHER ASSETS:
|
||||||||
Noncurrent restricted cash
|
20,252
|
15,259
|
||||||
Noncurrent receivables, less allowance of $765 and $837 at December 31, 2016 and 2015, respectively
|
5,633
|
5,278
|
||||||
Goodwill
|
14,536
|
14,536
|
||||||
Other assets, net
|
1,044
|
1,190
|
||||||
Total other assets
|
41,465
|
36,263
|
||||||
TOTAL
|
$
|
163,207
|
$
|
207,750
|
December 31,
|
||||||||
2016
|
2015
|
|||||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
CURRENT LIABILITIES:
|
||||||||
Current portion of term loan and credit agreement
|
$
|
11,713
|
$
|
10,000
|
||||
Current portion of capital lease obligations
|
-
|
114
|
||||||
Unearned tuition
|
17,523
|
23,703
|
||||||
Accounts payable
|
13,748
|
12,863
|
||||||
Accrued expenses
|
12,815
|
11,209
|
||||||
Liabilities held for sale
|
11,578
|
12,332
|
||||||
Other short-term liabilities
|
653
|
686
|
||||||
Total current liabilities
|
68,030
|
70,907
|
||||||
NONCURRENT LIABILITIES:
|
||||||||
Long-term term loan
|
30,244
|
32,124
|
||||||
Long-term capital lease obligations
|
-
|
3,785
|
||||||
Long-term finance obligation
|
-
|
9,672
|
||||||
Pension plan liabilities
|
5,368
|
5,549
|
||||||
Accrued rent
|
3,896
|
4,716
|
||||||
Other long-term liabilities
|
743
|
-
|
||||||
Total liabilities
|
108,281
|
126,753
|
||||||
COMMITMENTS AND CONTINGENCIES
|
||||||||
STOCKHOLDERS' EQUITY:
|
||||||||
Preferred stock, no par value - 10,000,000 shares authorized, no shares issued and outstanding at December 31, 2016 and 2015
|
-
|
-
|
||||||
Common stock, no par value - authorized 100,000,000 shares at December 31, 2016 and 2015, issued and outstanding 30,685,017 shares at December 31, 2016 and 29,727,555 shares at December 31, 2015
|
141,377
|
141,377
|
||||||
Additional paid-in capital
|
28,554
|
27,292
|
||||||
Treasury stock at cost - 5,910,541 shares at December 31, 2016 and 2015
|
(82,860
|
)
|
(82,860
|
)
|
||||
(Accumulated deficit) retained earnings
|
(26,044
|
)
|
2,260
|
|||||
Accumulated other comprehensive loss
|
(6,101
|
)
|
(7,072
|
)
|
||||
Total stockholders' equity
|
54,926
|
80,997
|
||||||
TOTAL
|
$
|
163,207
|
$
|
207,750
|
Year Ended December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
REVENUE
|
$
|
196,910
|
$
|
208,256
|
$
|
218,040
|
||||||
COSTS AND EXPENSES:
|
||||||||||||
Educational services and facilities
|
94,922
|
94,970
|
103,299
|
|||||||||
Selling, general and administrative
|
103,129
|
105,380
|
116,573
|
|||||||||
Loss (gain) on sale of assets
|
120
|
1,741
|
(58
|
)
|
||||||||
Impairment of goodwill and long-lived assets
|
3,902
|
216
|
21,885
|
|||||||||
Total costs and expenses
|
202,073
|
202,307
|
241,699
|
|||||||||
OPERATING (LOSS) INCOME
|
(5,163
|
)
|
5,949
|
(23,659
|
)
|
|||||||
OTHER:
|
||||||||||||
Interest income
|
155
|
52
|
62
|
|||||||||
Interest expense
|
(6,001
|
)
|
(5,727
|
)
|
(3,431
|
)
|
||||||
Other income
|
6,711
|
109
|
-
|
|||||||||
(LOSS) INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
(4,298
|
)
|
383
|
(27,028
|
)
|
|||||||
PROVISION (BENEFIT) FOR INCOME TAXES
|
200
|
242
|
(1,479
|
)
|
||||||||
(LOSS) INCOME FROM CONTINUING OPERATIONS
|
(4,498
|
)
|
141
|
(25,549
|
)
|
|||||||
LOSS FROM DISCONTINUED OPERATIONS, NET OF INCOME TAXES
|
(23,806
|
)
|
(3,491
|
)
|
(30,584
|
)
|
||||||
NET LOSS
|
$
|
(28,304
|
)
|
$
|
(3,350
|
)
|
$
|
(56,133
|
)
|
|||
Basic
|
||||||||||||
(Loss) income per share from continuing operations
|
$
|
(0.19
|
)
|
$
|
0.01
|
$
|
(1.12
|
)
|
||||
Loss per share from discontinued operations
|
(1.02
|
)
|
(0.15
|
)
|
(1.34
|
)
|
||||||
Net loss per share
|
$
|
(1.21
|
)
|
$
|
(0.14
|
)
|
$
|
(2.46
|
)
|
|||
Diluted
|
||||||||||||
(Loss) income per share from continuing operations
|
$
|
(0.19
|
)
|
$
|
0.01
|
$
|
(1.12
|
)
|
||||
Loss per share from discontinued operations
|
(1.02
|
)
|
(0.15
|
)
|
(1.34
|
)
|
||||||
Net loss per share
|
$
|
(1.21
|
)
|
$
|
(0.14
|
)
|
$
|
(2.46
|
)
|
|||
Weighted average number of common shares outstanding:
|
||||||||||||
Basic
|
23,453
|
23,167
|
22,814
|
|||||||||
Diluted
|
23,453
|
23,227
|
22,814
|
December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Net loss
|
$
|
(28,304
|
)
|
$
|
(3,350
|
)
|
$
|
(56,133
|
)
|
|||
Other comprehensive income (loss)
|
||||||||||||
Employee pension plan adjustments
|
971
|
395
|
(3,905
|
)
|
||||||||
Comprehensive loss
|
$
|
(27,333
|
)
|
$
|
(2,955
|
)
|
$
|
(60,038
|
)
|
Retained
|
Accumulated
|
|||||||||||||||||||||||||||
Additional
|
Earnings
|
Other
|
||||||||||||||||||||||||||
Common Stock
|
Paid-in
|
Treasury
|
(Accumulated
|
Comprehensive
|
||||||||||||||||||||||||
Shares
|
Amount
|
Capital
|
Stock
|
Deficit)
|
Loss
|
Total
|
||||||||||||||||||||||
BALANCE - January 1, 2014
|
29,919,761
|
$
|
141,377
|
$
|
24,177
|
$
|
(82,860
|
)
|
$
|
66,064
|
$
|
(3,562
|
)
|
$
|
145,196
|
|||||||||||||
Net loss
|
-
|
-
|
-
|
-
|
(56,133
|
)
|
-
|
(56,133
|
)
|
|||||||||||||||||||
Employee pension plan adjustments
|
-
|
-
|
-
|
-
|
-
|
(3,905
|
)
|
(3,905
|
)
|
|||||||||||||||||||
Stock-based compensation expense
|
||||||||||||||||||||||||||||
Restricted stock
|
158,308
|
-
|
2,517
|
-
|
-
|
-
|
2,517
|
|||||||||||||||||||||
Stock options
|
-
|
-
|
104
|
-
|
-
|
-
|
104
|
|||||||||||||||||||||
Net share settlement for equity-based compensation
|
(144,983
|
)
|
-
|
(448
|
)
|
-
|
-
|
-
|
(448
|
)
|
||||||||||||||||||
Cash dividend of $0.18 per common share
|
-
|
-
|
-
|
-
|
(4,321
|
)
|
-
|
(4,321
|
)
|
|||||||||||||||||||
BALANCE - December 31, 2014
|
29,933,086
|
141,377
|
26,350
|
(82,860
|
)
|
5,610
|
(7,467
|
)
|
83,010
|
|||||||||||||||||||
Net loss
|
-
|
-
|
-
|
-
|
(3,350
|
)
|
-
|
(3,350
|
)
|
|||||||||||||||||||
Employee pension plan adjustments
|
-
|
-
|
-
|
-
|
-
|
395
|
395
|
|||||||||||||||||||||
Stock-based compensation expense
|
||||||||||||||||||||||||||||
Restricted stock
|
(119,791
|
)
|
-
|
1,095
|
-
|
-
|
-
|
1,095
|
||||||||||||||||||||
Stock options
|
-
|
-
|
33
|
-
|
-
|
-
|
33
|
|||||||||||||||||||||
Net share settlement for equity-based compensation
|
(85,740
|
)
|
-
|
(186
|
)
|
-
|
-
|
-
|
(186
|
)
|
||||||||||||||||||
BALANCE - December 31, 2015
|
29,727,555
|
141,377
|
27,292
|
(82,860
|
)
|
2,260
|
(7,072
|
)
|
80,997
|
|||||||||||||||||||
Net loss
|
-
|
-
|
-
|
-
|
(28,304
|
)
|
-
|
(28,304
|
)
|
|||||||||||||||||||
Employee pension plan adjustments
|
-
|
-
|
-
|
-
|
-
|
971
|
971
|
|||||||||||||||||||||
Stock-based compensation expense
|
||||||||||||||||||||||||||||
Restricted stock
|
1,029,267
|
-
|
1,440
|
-
|
-
|
-
|
1,440
|
|||||||||||||||||||||
Net share settlement for equity-based compensation
|
(71,805
|
)
|
-
|
(178
|
)
|
-
|
-
|
-
|
(178
|
)
|
||||||||||||||||||
BALANCE - December 31, 2016
|
30,685,017
|
$
|
141,377
|
$
|
28,554
|
$
|
(82,860
|
)
|
$
|
(26,044
|
)
|
$
|
(6,101
|
)
|
$
|
54,926
|
Year Ended December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
||||||||||||
Net loss
|
$
|
(28,304
|
)
|
$
|
(3,350
|
)
|
$
|
(56,133
|
)
|
|||
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
|
||||||||||||
Depreciation and amortization
|
11,066
|
14,506
|
19,338
|
|||||||||
Amortization of deferred finance costs
|
949
|
554
|
818
|
|||||||||
Deferred income taxes
|
-
|
-
|
(4,528
|
)
|
||||||||
Loss on disposition of assets
|
223
|
1,738
|
41
|
|||||||||
Gain on capital lease termination, net
|
(6,710
|
)
|
(3,062
|
)
|
-
|
|||||||
Impairment of goodwill and long-lived assets
|
21,367
|
216
|
42,958
|
|||||||||
Fixed asset donation
|
(123
|
)
|
(20
|
)
|
(92
|
)
|
||||||
Provision for doubtful accounts
|
14,592
|
13,583
|
15,500
|
|||||||||
Stock-based compensation expense
|
1,440
|
1,128
|
2,621
|
|||||||||
Deferred rent
|
(489
|
)
|
(638
|
)
|
(740
|
)
|
||||||
(Increase) decrease in assets:
|
||||||||||||
Accounts receivable
|
(15,700
|
)
|
(13,216
|
)
|
(14,470
|
)
|
||||||
Inventories
|
201
|
9
|
372
|
|||||||||
Prepaid income taxes and income taxes receivable
|
87
|
530
|
7,638
|
|||||||||
Prepaid expenses and current assets
|
412
|
444
|
(986
|
)
|
||||||||
Other assets
|
(1,701
|
)
|
(1,460
|
)
|
231
|
|||||||
Increase (decrease) in liabilities:
|
||||||||||||
Accounts payable
|
742
|
1,004
|
(2,732
|
)
|
||||||||
Accrued expenses
|
1,195
|
(450
|
)
|
3,806
|
||||||||
Pension plan liabilities
|
-
|
-
|
(271
|
)
|
||||||||
Unearned tuition
|
(6,854
|
)
|
2,627
|
(1,190
|
)
|
|||||||
Other liabilities
|
1,500
|
194
|
(159
|
)
|
||||||||
Total adjustments
|
22,197
|
17,687
|
68,155
|
|||||||||
Net cash (used in) provided by operating activities
|
(6,107
|
)
|
14,337
|
12,022
|
||||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
||||||||||||
Capital expenditures
|
(3,596
|
)
|
(2,218
|
)
|
(7,472
|
)
|
||||||
Restricted cash
|
963
|
-
|
-
|
|||||||||
Proceeds from sale of property and equipment
|
451
|
451
|
67
|
|||||||||
Net cash used in investing activities
|
(2,182
|
)
|
(1,767
|
)
|
(7,405
|
)
|
||||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
||||||||||||
Proceeds from borrowings
|
-
|
53,500
|
47,500
|
|||||||||
Payments on borrowings
|
(387
|
)
|
(38,847
|
)
|
(72,000
|
)
|
||||||
Reclassifications of payments from borrowings to restricted cash
|
-
|
30,000
|
24,500
|
|||||||||
Reclassifications of proceeds from borrowings to restricted cash
|
(4,993
|
)
|
(22,621
|
)
|
-
|
|||||||
Payment of deferred finance fees
|
(645
|
)
|
(2,823
|
)
|
-
|
|||||||
Net share settlement for equity-based compensation
|
(178
|
)
|
(186
|
)
|
(448
|
)
|
||||||
Dividends paid
|
-
|
-
|
(4,321
|
)
|
||||||||
Payments under capital lease obligations
|
(2,864
|
)
|
(5,472
|
)
|
(435
|
)
|
||||||
Net cash (used in) provided by financing activities
|
(9,067
|
)
|
13,551
|
(5,204
|
)
|
|||||||
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS
|
(17,356
|
)
|
26,121
|
(587
|
)
|
|||||||
CASH AND CASH EQUIVALENTS—Beginning of year
|
38,420
|
12,299
|
12,886
|
|||||||||
CASH AND CASH EQUIVALENTS—End of year
|
$
|
21,064
|
$
|
38,420
|
$
|
12,299
|
Year Ended December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
|
||||||||||||
Cash paid during the year for:
|
||||||||||||
Interest
|
$
|
5,265
|
$
|
7,159
|
$
|
4,597
|
||||||
Income taxes
|
$
|
150
|
$
|
89
|
$
|
145
|
||||||
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES:
|
||||||||||||
Liabilities accrued for or noncash purchases of fixed assets
|
$
|
2,048
|
$
|
979
|
$
|
1,613
|
1. |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
|
|
Segment
|
|
Status
|
|
||||
School
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
Allentown, PA
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Edison, NJ
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Moorestown, NJ
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Paramus, NJ
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Lincoln, RI
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Brockton, MA
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Somerville, MA
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Lowell, MA
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
New Britain, CT
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Shelton, CT
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Las Vegas (Summerlin), NV
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Southington, CT
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Marietta, GA
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Held for sale
|
1
|
Hartford, CT
|
|
Transitional (Continuing Operations)
|
|
HOPS (Discontinued Operations)
|
|
Teach-out
|
|
Closed
|
2
|
Henderson (Green Valley), NV
|
|
HOPS (Discontinued Operations)
|
|
HOPS (Discontinued Operations)
|
|
Held for sale
|
|
Closed
|
3
|
Center City Philadelphia, PA
|
|
HOPS (Discontinued Operations)
|
|
Transitional (Continuing Operations)
|
|
Held for sale
|
|
Teach-out
|
4
|
Northeast Philadelphia, PA
|
|
HOPS (Discontinued Operations)
|
|
Transitional (Continuing Operations)
|
|
Held for sale
|
|
Teach-out
|
4
|
West Palm Beach, FL
|
|
HOPS (Discontinued Operations)
|
|
Transitional (Continuing Operations)
|
|
Held for sale
|
|
Teach-out
|
5
|
Fern Park, FL
|
|
Transitional (Continuing Operations)
|
|
Transitional (Continuing Operations)
|
|
Teach-out
|
|
Closed
|
6
|
1 |
In November 2015, the Board of Directors approved a plan to divest these schools and thus they are included in discontinued operations as of December 31, 2016 and 2015.
|
2 |
In November 2015, the Board of Directors approved a plan to divest this school. In December 2015, the Board of Directors approved a plan to cease operations at this school. The school was included in the Transitional Segment and included in continuing operations until it closed in the fourth quarter of 2016; it is included in discontinued operations as of December 31, 2016.
|
3 |
In November 2015, the Board of Directors approved a plan to divest this school. In the fourth quarter of 2016, the Board of Directors approved a plan to cease operations at this school, which closed in the fourth quarter of 2016 and is included in discontinued operations as of December 31, 2016.
|
4 |
In November 2015, the Board of Directors approved a plan to divest these schools. In the fourth quarter of 2016, the Board of Directors approved a plan to cease operations at these schools which are being taught-out and expected to be closed in 2017. These schools are included in the Transitional segment and continuing operations as of December 31, 2016.
|
5 |
In November 2015, the Board of Directors approved a plan to divest this school. In the third quarter of 2016, the Board of Directors approved a plan to teach–out certain programs at this school. Then, in the fourth quarter of 2016, the Board of Directors approved a plan to teach-out the remainder of the programs at this school. The school is expected to be closed in 2017. This school’s operations are included in the Transitional segment and continuing operations as of December 31, 2016. However, as part of this plan, the Board of Directors approved the divestiture of the properties for this school and therefore the properties are included in held for sale as of December 31, 2016.
|
6 |
On February 27, 2015, our Board of Directors approved a plan to cease operations at this school, which was fully taught out and officially closed as of March 31, 2016 and is included in the Transitional segment and continuing operations as of December 31, 2016. The plan to teach out this school was approved prior to the plan to exit the HOPS segment and as such does not meet the discontinued operations criteria.
|
2. |
FINANCIAL AID AND REGULATORY COMPLIANCE
|
· |
Posting a letter of credit in an amount determined by the DOE equal to at least 50% of the total Title IV Program funds received by the institution during the institution's most recently completed fiscal year;
|
· |
Posting a letter of credit in an amount determined by the DOE equal to at least 10% of such prior year's Title IV Program funds, accepting provisional certification, complying with additional DOE monitoring requirements and agreeing to receive Title IV Program funds under an arrangement other than the DOE's standard advance funding arrangement.
|
3. |
WEIGHTED AVERAGE COMMON SHARES
|
Year Ended December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Basic shares outstanding
|
23,453,427
|
23,166,977
|
22,814,105
|
|||||||||
Dilutive effect of stock options
|
-
|
60,161
|
-
|
|||||||||
Diluted shares outstanding
|
23,453,427
|
23,227,138
|
22,814,105
|
4. |
DISCONTINUED OPERATIONS
|
Year Ended December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Revenue
|
$
|
88,649
|
$
|
97,846
|
$
|
106,982
|
||||||
Loss before income tax
|
(6,341
|
)
|
(3,491
|
)
|
(26,684
|
)
|
||||||
Income tax benefit
|
-
|
-
|
(2,746
|
)
|
||||||||
Net loss from discontinued operations
|
$
|
(6,341
|
)
|
$
|
(3,491
|
)
|
$
|
(23,938
|
)
|
Year Ended December 31,
|
||||
2014
|
||||
Revenue
|
$
|
2,140
|
||
Loss before income tax
|
(6,731
|
)
|
||
Income tax benefit
|
(85
|
)
|
||
Net loss from discontinued operations
|
$
|
(6,646
|
)
|
5. |
GOODWILL AND OTHER INTANGIBLES
|
Gross
Goodwill
Balance
|
Accumulated
Impairment
Losses
|
Net
Goodwill
Balance
|
||||||||||
Balance as of January 1, 2015
|
$
|
115,872
|
$
|
(93,665
|
)
|
$
|
22,207
|
|||||
Asset held for sale (1)
|
(7,455
|
)
|
-
|
(7,455
|
)
|
|||||||
Goodwill impairment
|
-
|
(216
|
)
|
(216
|
)
|
|||||||
Balance as of December 31, 2015
|
108,417
|
(93,881
|
)
|
14,536
|
||||||||
Adjustment
|
-
|
-
|
-
|
|||||||||
Balance as of December 31, 2016
|
$
|
108,417
|
$
|
(93,881
|
)
|
$
|
14,536
|
(1) |
Amount consists of $1.3 million of goodwill held for sale as of December 31, 2014 offset by $8.8 million of goodwill as of December 31, 2015. Refer to Note 6 for more information on assets held for sale.
|
Trade
Name
|
Accreditation
|
Curriculum
|
Total
|
|||||||||||||
Gross carrying amount at December 31, 2015
|
$
|
310
|
$
|
-
|
$
|
160
|
$
|
470
|
||||||||
Additions
|
-
|
-
|
-
|
-
|
||||||||||||
Gross carrying amount at December 31, 2016
|
310
|
-
|
160
|
470
|
||||||||||||
Accumulated amortization at December 31, 2015
|
308
|
-
|
112
|
420
|
||||||||||||
Amortization
|
2
|
-
|
16
|
18
|
||||||||||||
Accumulated amortization at December 31, 2016
|
310
|
-
|
128
|
438
|
||||||||||||
Net carrying amount at December 31, 2016
|
$
|
-
|
$
|
-
|
$
|
32
|
$
|
32
|
||||||||
Weighted average amortization period (years)
|
7
|
Indefinite
|
10
|
Trade
Name
|
Accreditation
|
Curriculum
|
Total
|
|||||||||||||
Gross carrying amount at December 31, 2014
|
$
|
310
|
$
|
1,064
|
$
|
550
|
$
|
1,924
|
||||||||
Asset held for sale (1)
|
-
|
(1,064
|
)
|
(390
|
)
|
(1,454
|
)
|
|||||||||
Gross carrying amount at December 31, 2015
|
310
|
-
|
160
|
470
|
||||||||||||
Accumulated amortization at December 31, 2014
|
264
|
-
|
469
|
733
|
||||||||||||
Amortization
|
44
|
-
|
21
|
65
|
||||||||||||
Asset held for sale (1)
|
-
|
-
|
(378
|
)
|
(378
|
)
|
||||||||||
Accumulated amortization at December 31, 2015
|
308
|
-
|
112
|
420
|
||||||||||||
Net carrying amount at December 31, 2015
|
$
|
2
|
$
|
-
|
$
|
48
|
$
|
50
|
||||||||
Weighted average amortization period (years)
|
7
|
Indefinite
|
10
|
(1) |
Refer to Note 6 for more information on assets held for sale.
|
Year Ending December 31,
|
||||
2017
|
$
|
16
|
||
2018
|
16
|
|||
$
|
32
|
6. |
PROPERTY, EQUIPMENT AND FACILITIES
|
Useful life
(years)
|
At December 31,
|
|||||||||||
2016
|
2015
|
|||||||||||
Land (a)
|
-
|
$
|
6,969
|
$
|
10,054
|
|||||||
Buildings and improvements (a)
|
1-25
|
105,433
|
112,281
|
|||||||||
Equipment, furniture and fixtures
|
1-7
|
65,776
|
66,838
|
|||||||||
Vehicles
|
3
|
534
|
617
|
|||||||||
Construction in progress
|
-
|
925
|
159
|
|||||||||
179,637
|
189,949
|
|||||||||||
Less accumulated depreciation and amortization
|
(124,192
|
)
|
(123,324
|
)
|
||||||||
$
|
55,445
|
$
|
66,625
|
At December 31,
2016
|
At December 31,
2015
|
|||||||
Assets held for sale
|
||||||||
Inventories
|
$
|
629
|
$
|
646
|
||||
Accounts receivable, less allowance of $3,930 and $3,261 at December 31, 2016 and 2015, respectively
|
5,089
|
4,526
|
||||||
Prepaid expense and other current assets
|
460
|
724
|
||||||
Noncurrent receivables, less allowance of $212 and $189 at December 31, 2016 and 2015, respectively
|
1,690
|
1,384
|
||||||
Property, equipment and facilities - at cost, net of accumluated depreciation and amortization of $41,703 and $34,751 at December 31, 2016 and 2015, respectively (b) (c)
|
16,847
|
27,133
|
||||||
Goodwill (d)
|
-
|
8,759
|
||||||
Other assets, net (e)
|
71
|
1,197
|
||||||
Assets held for sale
|
24,786
|
44,369
|
||||||
Liabilities held for sale
|
||||||||
Unearned tuition
|
(7,255
|
)
|
(7,929
|
)
|
||||
Accrued expenses
|
(2,553
|
)
|
(2,668
|
)
|
||||
Accrued rent
|
(1,770
|
)
|
(1,735
|
)
|
||||
Liabilities held for sale
|
(11,578
|
)
|
(12,332
|
)
|
||||
Assets held for sale, net
|
$
|
13,208
|
$
|
32,037
|
7. |
ACCRUED EXPENSES
|
At December 31,
|
||||||||
2016
|
2015
|
|||||||
Accrued compensation and benefits
|
$
|
6,664
|
$
|
6,151
|
||||
Accrued rent and real estate taxes
|
$
|
2,917
|
$
|
2,012
|
||||
Other accrued expenses
|
3,234
|
3,046
|
||||||
$
|
12,815
|
$
|
11,209
|
8. |
LONG-TERM DEBT AND LEASE OBLIGATIONS
|
At December 31,
|
||||||||
2016
|
2015
|
|||||||
Term loan (a)
|
$
|
44,267
|
$
|
44,653
|
||||
Finance obligation (b)
|
-
|
9,672
|
||||||
Capital lease-property (with a rate of 8.0%) (c)
|
-
|
3,899
|
||||||
44,267
|
58,224
|
|||||||
Less current maturities
|
(11,713
|
)
|
(10,114
|
)
|
||||
$
|
32,554
|
$
|
48,110
|
Year ending December 31,
|
||||
2017
|
$
|
11,713
|
||
2018
|
3,427
|
|||
2019
|
29,127
|
|||
2020
|
-
|
|||
2021
|
-
|
|||
Thereafter
|
-
|
|||
$
|
44,267
|
9. |
STOCKHOLDERS' EQUITY
|
Shares
|
Weighted
Average Grant
Date Fair Value
Per Share
|
|||||||
Nonvested restricted stock outstanding at December 31, 2014
|
925,819
|
$
|
5.04
|
|||||
Granted
|
234,651
|
2.28
|
||||||
Cancelled
|
(354,462
|
)
|
4.97
|
|||||
Vested
|
(355,514
|
)
|
5.00
|
|||||
Nonvested restricted stock outstanding at December 31, 2015
|
450,494
|
3.69
|
||||||
Granted
|
1,105,487
|
1.67
|
||||||
Cancelled
|
(76,200
|
)
|
2.98
|
|||||
Vested
|
(336,182
|
)
|
3.33
|
|||||
Nonvested restricted stock outstanding at December 31, 2016
|
1,143,599
|
1.89
|
Shares
|
Weighted
Average
Exercise Price
Per Share
|
Weighted
Average
Remaining
Contractual
Term
|
Aggregate
Intrinsic Value
|
||||||||||
Outstanding December 31, 2013
|
547,125
|
$
|
14.73
|
4.56 years
|
$
|
-
|
|||||||
Cancelled
|
(122,958
|
)
|
18.49
|
-
|
|||||||||
Outstanding December 31, 2014
|
424,167
|
13.65
|
4.18 years
|
-
|
|||||||||
Cancelled
|
(178,000
|
)
|
15.20
|
-
|
|||||||||
Outstanding December 31, 2015
|
246,167
|
12.52
|
3.98 years
|
-
|
|||||||||
Cancelled
|
(28,000
|
)
|
15.76
|
||||||||||
Outstanding December 31, 2016
|
218,167
|
12.11
|
3.33 years
|
-
|
|||||||||
Vested or expected to vest as of December 31, 2016
|
218,167
|
12.11
|
3.33 years
|
-
|
|||||||||
Exercisable as of December 31, 2016
|
218,167
|
12.11
|
3.33 years
|
-
|
At December 31, 2016
|
||||||||||||||||||||||
Stock Options Outstanding
|
Stock Options Exercisable
|
|||||||||||||||||||||
Range of Exercise Prices
|
Shares
|
Contractual
Weighted
Average life
(years)
|
Weighted
Average Exercise
Price
|
Shares
|
Weighted
Average Exercise
Price
|
|||||||||||||||||
$
|
4.00-$13.99
|
165,167
|
3.35
|
$
|
9.46
|
165,167
|
$
|
9.46
|
||||||||||||||
$
|
14.00-$19.99
|
22,000
|
2.84
|
19.98
|
22,000
|
19.98
|
||||||||||||||||
$
|
20.00-$25.00
|
31,000
|
3.59
|
20.62
|
31,000
|
20.62
|
||||||||||||||||
218,167
|
3.33
|
12.11
|
218,167
|
12.11
|
10. |
PENSION PLAN
|
Year Ended December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
CHANGES IN BENEFIT OBLIGATIONS:
|
||||||||||||
Benefit obligation-beginning of year
|
$
|
23,341
|
$
|
24,299
|
$
|
20,314
|
||||||
Service cost
|
28
|
28
|
23
|
|||||||||
Interest cost
|
888
|
884
|
892
|
|||||||||
Actuarial (gain) loss
|
(255
|
)
|
(782
|
)
|
4,149
|
|||||||
Benefits paid
|
(1,086
|
)
|
(1,088
|
)
|
(1,079
|
)
|
||||||
Benefit obligation at end of year
|
22,916
|
23,341
|
24,299
|
|||||||||
CHANGE IN PLAN ASSETS:
|
||||||||||||
Fair value of plan assets-beginning of year
|
17,792
|
19,000
|
18,792
|
|||||||||
Actual return on plan assets
|
842
|
(120
|
)
|
1,017
|
||||||||
Employer contributions
|
-
|
-
|
270
|
|||||||||
Benefits paid
|
(1,086
|
)
|
(1,088
|
)
|
(1,079
|
)
|
||||||
Fair value of plan assets-end of year
|
17,548
|
17,792
|
19,000
|
|||||||||
BENEFIT OBLIGATION IN EXCESS OF FAIR VALUE FUNDED STATUS:
|
$
|
(5,368
|
)
|
$
|
(5,549
|
)
|
$
|
(5,299
|
)
|
At December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Noncurrent liabilities
|
$
|
(5,368
|
)
|
$
|
(5,549
|
)
|
$
|
(5,299
|
)
|
Year Ended December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Accumulated loss
|
$
|
(8,467
|
)
|
$
|
(9,438
|
)
|
$
|
(9,833
|
)
|
|||
Deferred income taxes
|
2,366
|
2,366
|
2,366
|
|||||||||
Accumulated other comprehensive loss
|
$
|
(6,101
|
)
|
$
|
(7,072
|
)
|
$
|
(7,467
|
)
|
Year Ended December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
COMPONENTS OF NET PERIODIC BENEFIT COST
|
||||||||||||
Service cost
|
$
|
28
|
$
|
28
|
$
|
23
|
||||||
Interest cost
|
888
|
884
|
892
|
|||||||||
Expected return on plan assets
|
(1,118
|
)
|
(1,243
|
)
|
(1,287
|
)
|
||||||
Recognized net actuarial loss
|
991
|
976
|
513
|
|||||||||
Net periodic benefit cost
|
$
|
789
|
$
|
645
|
$
|
141
|
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
|
Significant Other
Observable Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
Total
|
|||||||||||||
Equity securities
|
$
|
8,509
|
$
|
-
|
$
|
-
|
$
|
8,509
|
||||||||
Fixed income
|
6,548
|
-
|
-
|
6,548
|
||||||||||||
International equities
|
2,484
|
-
|
-
|
2,484
|
||||||||||||
Cash and equivalents
|
7
|
-
|
-
|
7
|
||||||||||||
Balance at December 31, 2016
|
$
|
17,548
|
$
|
-
|
$
|
-
|
$
|
17,548
|
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
|
Significant Other
Observable Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
Total
|
|||||||||||||
Equity securities
|
$
|
8,473
|
$
|
-
|
$
|
-
|
$
|
8,473
|
||||||||
Fixed income
|
5,943
|
-
|
-
|
5,943
|
||||||||||||
International equities
|
3,288
|
-
|
-
|
3,288
|
||||||||||||
Cash and equivalents
|
88
|
-
|
-
|
88
|
||||||||||||
Balance at December 31, 2015
|
$
|
17,792
|
$
|
-
|
$
|
-
|
$
|
17,792
|
2016
|
2015
|
2014
|
||||||||||
Equity securities
|
49
|
%
|
48
|
%
|
50
|
%
|
||||||
Fixed income
|
37
|
%
|
33
|
%
|
32
|
%
|
||||||
International equities
|
14
|
%
|
19
|
%
|
18
|
%
|
||||||
Cash and equivalents
|
0
|
%
|
0
|
%
|
0
|
%
|
||||||
Total
|
100
|
%
|
100
|
%
|
100
|
%
|
2016
|
2015
|
2014
|
||||||||||
Discount rate
|
3.81
|
%
|
3.94
|
%
|
3.66
|
%
|
||||||
Rate of compensation increase
|
2.50
|
%
|
2.50
|
%
|
1.13
|
%
|
2016
|
2015
|
2014
|
||||||||||
Discount rate
|
3.81
|
%
|
3.94
|
%
|
4.46
|
%
|
||||||
Rate of compensation increase
|
2.50
|
%
|
2.50
|
%
|
1.13
|
%
|
||||||
Long-term rate of return
|
6.25
|
%
|
6.50
|
%
|
7.00
|
%
|
Year Ending December 31,
|
||||
2017
|
$
|
1,257
|
||
2018
|
1,323
|
|||
2019
|
1,357
|
|||
2020
|
1,369
|
|||
2021
|
1,376
|
|||
Years 2022-2026
|
7,039
|
11. |
INCOME TAXES
|
Year Ended December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Current:
|
||||||||||||
Federal
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||
State
|
200
|
242
|
200
|
|||||||||
Total
|
200
|
242
|
200
|
|||||||||
Deferred:
|
||||||||||||
Federal
|
-
|
-
|
(1,420
|
)
|
||||||||
State
|
-
|
-
|
(259
|
)
|
||||||||
Total
|
-
|
-
|
(1,679
|
)
|
||||||||
Total provision (benefit)
|
$
|
200
|
$
|
242
|
$
|
(1,479
|
)
|
At December 31,
|
||||||||
2016
|
2015
|
|||||||
Noncurrent deferred tax assets (liabilities)
|
||||||||
Allowance for bad debts
|
$
|
5,904
|
$
|
5,617
|
||||
Accrued rent
|
3,191
|
2,952
|
||||||
Accrued bonus
|
1,429
|
-
|
||||||
Accrued benefits
|
198
|
-
|
||||||
Stock-based compensation
|
557
|
498
|
||||||
Depreciation
|
20,372
|
14,941
|
||||||
Goodwill
|
1,959
|
(380
|
)
|
|||||
Other intangibles
|
562
|
274
|
||||||
Pension plan liabilities
|
2,142
|
2,215
|
||||||
Net operating loss carryforwards
|
17,846
|
14,765
|
||||||
Sale leaseback-deferred gain
|
-
|
2,629
|
||||||
AMT credit
|
424
|
424
|
||||||
Total noncurrent deferred tax assets
|
54,584
|
43,935
|
||||||
Less valuation allowance
|
(54,584
|
)
|
(43,935
|
)
|
||||
Noncurrent deferred tax assets, net of valuation allowance
|
$
|
-
|
$
|
-
|
Year Ended December 31,
|
||||||||||||||||||||||||
2016
|
2015
|
2014
|
||||||||||||||||||||||
(Loss) gain from continuing operations before taxes
|
$
|
(4,298
|
)
|
$
|
383
|
$
|
(27,028
|
)
|
||||||||||||||||
Expected tax benefit
|
$
|
(1,504
|
)
|
35.0
|
%
|
$
|
134
|
35.0
|
%
|
$
|
(9,460
|
)
|
35.0
|
%
|
||||||||||
State tax benefit (net of federal)
|
200
|
(4.7
|
)
|
242
|
63.2
|
(43
|
)
|
0.2
|
||||||||||||||||
Valuation allowance
|
1,394
|
(32.4
|
)
|
(274
|
)
|
(71.5
|
)
|
7,876
|
(29.1
|
)
|
||||||||||||||
Other
|
110
|
(2.6
|
)
|
140
|
36.5
|
148
|
(0.6
|
)
|
||||||||||||||||
Total
|
$
|
200
|
-4.7
|
%
|
$
|
242
|
63.2
|
%
|
$
|
(1,479
|
)
|
5.5
|
%
|
Year Ended December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Balance at January 1,
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||
Decrease for tax positions of prior years
|
-
|
-
|
-
|
|||||||||
Increase for tax positions of current year
|
-
|
-
|
-
|
|||||||||
Balance at December 31,
|
$
|
-
|
$
|
-
|
$
|
-
|
12. |
FAIR VALUE
|
December 31, 2016
|
||||||||||||||||||||
Carrying
Amount
|
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
|
Significant Other
Observable Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
Total
|
||||||||||||||||
Financial Assets:
|
||||||||||||||||||||
Cash and cash equivalents
|
$
|
21,064
|
$
|
21,064
|
$
|
-
|
$
|
-
|
$
|
21,064
|
||||||||||
Restricted cash
|
6,399
|
6,399
|
-
|
-
|
6,399
|
|||||||||||||||
Prepaid expenses and other current assets
|
2,434
|
-
|
2,434
|
-
|
2,434
|
|||||||||||||||
Noncurrent restricted cash
|
20,252
|
20,252
|
-
|
-
|
20,252
|
|||||||||||||||
Financial Liabilities:
|
||||||||||||||||||||
Accrued expenses
|
$
|
12,815
|
$
|
-
|
$
|
12,815
|
$
|
-
|
$
|
12,815
|
||||||||||
Other short term liabilities
|
653
|
-
|
653
|
-
|
653
|
|||||||||||||||
Term loan
|
44,267
|
-
|
40,687
|
-
|
40,687
|
December 31, 2015
|
||||||||||||||||||||
Carrying
Amount
|
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
|
Significant Other
Observable Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
Total
|
||||||||||||||||
Financial Assets:
|
||||||||||||||||||||
Cash and cash equivalents
|
$
|
38,420
|
$
|
38,420
|
$
|
-
|
$
|
-
|
$
|
38,420
|
||||||||||
Restricted cash
|
7,362
|
7,362
|
-
|
-
|
7,362
|
|||||||||||||||
Prepaid expenses and other current assets
|
2,710
|
-
|
2,710
|
-
|
2,710
|
|||||||||||||||
Noncurrent restricted cash
|
15,259
|
15,259
|
-
|
-
|
15,259
|
|||||||||||||||
Financial Liabilities:
|
||||||||||||||||||||
Accrued expenses
|
$
|
11,209
|
$
|
-
|
$
|
11,209
|
$
|
-
|
$
|
11,209
|
||||||||||
Other short term liabilities
|
686
|
-
|
686
|
-
|
686
|
|||||||||||||||
Term loan
|
44,653
|
-
|
36,795
|
-
|
36,795
|
13. |
SEGMENT REPORTING
|
For the Year Ended December 31,
|
||||||||||||||||||||||||||||||||||||
Revenue
|
Operating (Loss) Income
|
|||||||||||||||||||||||||||||||||||
2016
|
% of
Total
|
2015
|
% of
Total
|
2014
|
% of
Total
|
2016
|
2015
|
2014
|
||||||||||||||||||||||||||||
Transportation and Skilled Trades
|
$
|
177,882
|
90.3
|
%
|
$
|
183,821
|
88.3
|
%
|
$
|
188,669
|
86.5
|
%
|
$
|
21,278
|
$
|
26,778
|
$
|
19,519
|
||||||||||||||||||
Transitional
|
19,028
|
9.7
|
%
|
24,435
|
11.7
|
%
|
29,371
|
13.5
|
%
|
(6,334
|
)
|
(1,689
|
)
|
(19,814
|
)
|
|||||||||||||||||||||
Corporate
|
-
|
0.0
|
%
|
-
|
0.0
|
%
|
-
|
0.0
|
%
|
(20,107
|
)
|
(19,140
|
)
|
(23,364
|
)
|
|||||||||||||||||||||
Total
|
$
|
196,910
|
100
|
%
|
$
|
208,256
|
100
|
%
|
$
|
218,040
|
100
|
%
|
$
|
(5,163
|
)
|
$
|
5,949
|
$
|
(23,659
|
)
|
Total Assets
|
||||||||
December 31, 2016
|
December 31, 2015
|
|||||||
Transportation and Skilled Trades
|
$
|
83,320
|
$
|
90,045
|
||||
Transitional
|
1,594
|
4,492
|
||||||
Corporate
|
53,507
|
68,844
|
||||||
Discontinued Operations
|
24,786
|
44,369
|
||||||
Total
|
$
|
163,207
|
$
|
207,750
|
14. |
COMMITMENTS AND CONTINGENCIES
|
Year Ending December 31,
|
Credit
Agreement
|
Operating
Leases
|
||||||
2017
|
$
|
16,048
|
$
|
21,428
|
||||
2018
|
6,881
|
19,132
|
||||||
2019
|
30,958
|
16,521
|
||||||
2020
|
-
|
12,439
|
||||||
2021
|
-
|
7,202
|
||||||
Thereafter
|
-
|
20,484
|
||||||
53,887
|
97,206
|
|||||||
Less amount representing interest
|
(9,620
|
)
|
-
|
|||||
$
|
44,267
|
$
|
97,206
|
15. |
RELATED PARTY
|
16. |
UNAUDITED QUARTERLY FINANCIAL INFORMATION
|
Quarter
|
||||||||||||||||
2016
|
First
|
Second
|
Third
|
Fourth
|
||||||||||||
Revenue
|
$
|
47,423
|
$
|
46,263
|
$
|
52,877
|
$
|
50,348
|
||||||||
(Loss) income from continuing operations
|
(4,638
|
)
|
(1,642
|
)
|
1,697
|
84
|
||||||||||
(Loss) income from discontinued operations
|
(1,430
|
)
|
(1,496
|
)
|
(2,168
|
)
|
(18,711
|
)
|
||||||||
Loss income
|
(6,068
|
)
|
(3,138
|
)
|
(471
|
)
|
(18,627
|
)
|
||||||||
Basic
|
||||||||||||||||
(Loss) earnings per share from continuing operations
|
$
|
(0.20
|
)
|
$
|
(0.07
|
)
|
$
|
0.07
|
$
|
0.00
|
||||||
(Loss) earnings per share from discontinued operations
|
(0.06
|
)
|
(0.06
|
)
|
(0.09
|
)
|
(0.79
|
)
|
||||||||
Net (loss) earnings per share
|
$
|
(0.26
|
)
|
$
|
(0.13
|
)
|
$
|
(0.02
|
)
|
$
|
(0.79
|
)
|
||||
Diluted
|
||||||||||||||||
(Loss) earnings per share from continuing operations
|
$
|
(0.20
|
)
|
$
|
(0.07
|
)
|
$
|
0.07
|
$
|
0.00
|
||||||
(Loss) earnings per share from discontinued operations
|
(0.06
|
)
|
(0.06
|
)
|
(0.09
|
)
|
(0.76
|
)
|
||||||||
Net (loss) earnings per share
|
$
|
(0.26
|
)
|
$
|
(0.13
|
)
|
$
|
(0.02
|
)
|
$
|
(0.76
|
)
|
||||
Weighted average number of common shares outstanding:
|
||||||||||||||||
Basic
|
23,351
|
23,448
|
23,499
|
23,514
|
||||||||||||
Diluted
|
23,351
|
23,448
|
24,680
|
24,602
|
Quarter
|
||||||||||||||||
2015
|
First
|
Second
|
Third
|
Fourth
|
||||||||||||
Revenue
|
$
|
51,345
|
$
|
48,607
|
$
|
55,752
|
$
|
52,552
|
||||||||
(Loss) income from continuing operations
|
(4,786
|
)
|
(4,169
|
)
|
5,217
|
3,878
|
||||||||||
(Loss) income from discontinued operations
|
(2,097
|
)
|
(3,436
|
)
|
(2,636
|
)
|
4,679
|
|||||||||
Net (loss) income
|
(6,883
|
)
|
(7,605
|
)
|
2,581
|
8,557
|
||||||||||
Basic
|
||||||||||||||||
(Loss) earnings per share from continuing operations
|
$
|
(0.21
|
)
|
$
|
(0.18
|
)
|
$
|
0.22
|
$
|
0.17
|
||||||
(Loss) earnings per share from discontinued operations
|
(0.09
|
)
|
(0.15
|
)
|
(0.11
|
)
|
0.20
|
|||||||||
Net (loss) earnings per share
|
$
|
(0.30
|
)
|
$
|
(0.33
|
)
|
$
|
0.11
|
$
|
0.37
|
||||||
Diluted
|
||||||||||||||||
(Loss) earnings per share from continuing operations
|
$
|
(0.21
|
)
|
$
|
(0.18
|
)
|
$
|
0.22
|
$
|
0.17
|
||||||
(Loss) earnings per share from discontinued operations
|
(0.09
|
)
|
(0.15
|
)
|
(0.11
|
)
|
0.20
|
|||||||||
Net (loss) earnings per share
|
$
|
(0.30
|
)
|
$
|
(0.33
|
)
|
$
|
0.11
|
$
|
0.37
|
||||||
Weighted average number of common shares outstanding:
|
||||||||||||||||
Basic
|
23,056
|
23,132
|
23,230
|
23,247
|
||||||||||||
Diluted
|
23,056
|
23,132
|
23,270
|
23,347
|
17. |
DIVIDENDS
|
Description
|
Balance at
Beginning
of Period
|
Charged to
Expense
|
Accounts
Written-off
|
Balance at
End of
Period
|
||||||||||||
Allowance accounts for the year ended:
|
||||||||||||||||
December 31, 2016 Student receivable allowance
|
$
|
14,074
|
$
|
14,592
|
$
|
(13,872
|
)
|
$
|
14,794
|
|||||||
December 31, 2015 Student receivable allowance
|
$
|
14,849
|
$
|
13,583
|
$
|
(14,358
|
)
|
$
|
14,074
|
|||||||
December 31, 2014 Student receivable allowance
|
$
|
14,769
|
$
|
15,500
|
$
|
(15,420
|
)
|
$
|
14,849
|
Exhibit
Number
|
Description
|
3.1
|
Amended and Restated Certificate of Incorporation of the Company (1).
|
3.2
|
By-laws of the Company (2).
|
4.1
|
Management Stockholders Agreement, dated as of January 1, 2002, by and among Lincoln Technical Institute, Inc., Back to School Acquisition, L.L.C. and the Stockholders and other holders of options under the Management Stock Option Plan listed therein (3).
|
4.2
|
Assumption Agreement and First Amendment to Management Stockholders Agreement, dated as of December 20, 2007, by and among Lincoln Educational Services Corporation, Lincoln Technical Institute, Inc., Back to School Acquisition, L.L.C. and the Management Investors parties therein (4).
|
4.3
|
Registration Rights Agreement, dated as of June 27, 2005, between the Company and Back to School Acquisition, L.L.C. (2).
|
4.4
|
Specimen Stock Certificate evidencing shares of common stock (5).
|
10.1
|
Credit Agreement, dated as of July 31, 2015, among Lincoln Educational Services Corporation and its wholly-owned subsidiaries, the Lenders and Collateral Agents party thereto, and HPF Service, LLC, as Administrative Agent (6).
|
10.2
|
First Amendment to Credit Agreement, dated as of December 31, 2015, among Lincoln Educational Services Corporation and its wholly-owned subsidiaries, the Lenders and Collateral Agents party thereto, and HPF Service, LLC, as Administrative Agent (7).
|
10.3
|
Second Amendment to Credit Agreement, dated as of February 29, 2016, among Lincoln Educational Services Corporation and its wholly-owned subsidiaries, the Lenders party thereto, and HPF Service, LLC, as Administrative Agent and Tranche A Collateral Agent (8).
|
10.4
|
Credit Agreement, dated as of April 12, 2016, among the Company, Lincoln Technical Institute, Inc. and its subsidiaries, and Sterling National Bank (9).
|
10.5
|
Purchase and Sale Agreement, dated as of July 1, 2016, between New England Institute of Technology at Palm Beach, Inc. and School Property Development Metrocentre, LLC (10).
|
10.6
|
Separation and Release Agreement, dated as of May 5, 2015, between the Company and Shaun E. McAlmont (11).
|
10.7
|
Employment Agreement, dated as of January 30, 2015, between the Company and Scott M. Shaw (12).
|
10.8
|
Employment Agreement, dated as of August 31, 2015, between the Company and Scott M. Shaw (13).
|
10.9
|
Employment Agreement, dated as of August 23, 2016, between the Company and Scott M. Shaw (14)
|
10.10
|
Employment Agreement, dated as of June 2, 2014, between the Company and Kenneth M. Swisstack (15).
|
10.11
|
Amendment to Employment Agreement, dated as of March 12, 2015, between the Company and Kenneth M. Swisstack. (16)
|
10.12
|
Separation and Release Agreement, dated as of January 15, 2016, between the Company and Kenneth M. Swisstack (17).
|
10.13
|
Employment Agreement, dated as of March 12, 2015, between the Company and Brian K. Meyers (16).
|
10.14
|
Employment Agreement, dated as of August 23, 2016, between the Company and Brian K. Meyers (14).
|
Change in Control Agreement, dated August 31, 2016, between the Company and Deborah Ramentol.
|
|
10.16
|
Lincoln Educational Services Corporation Amended and Restated 2005 Long-Term Incentive Plan (18).
|
10.17
|
Lincoln Educational Services Corporation Amended and Restated 2005 Non-Employee Directors Restricted Stock Plan (19).
|
10.18
|
Lincoln Educational Services Corporation 2005 Deferred Compensation Plan (3).
|
10.19
|
Lincoln Technical Institute Management Stock Option Plan, effective January 1, 2002 (3).
|
10.20
|
Form of Stock Option Agreement, dated January 1, 2002, between Lincoln Technical Institute, Inc. and certain participants (3).
|
10.21
|
Form of Stock Option Agreement under our 2005 Long-Term Incentive Plan (20).
|
10.22
|
Form of Restricted Stock Agreement under our 2005 Long-Term Incentive Plan (21).
|
10.23
|
Form of Performance-Based Restricted Stock Award Agreement under our Amended & Restated 2005 Long-Term Incentive Plan (16).
|
10.24
|
Management Stock Subscription Agreement, dated January 1, 2002, among Lincoln Technical Institute, Inc. and certain management investors (3).
|
Subsidiaries of the Company.
|
|
Consent of Independent Registered Public Accounting Firm.
|
|
24*
|
Power of Attorney (included on the Signatures page of this Form 10-K).
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101**
|
The following financial statements from Lincoln Educational Services Corporation’s Annual Report on Form 10-K for the year ended December 31, 2016, formatted in XBRL: (i) Consolidated Statements of Operations, (ii) Consolidated Balance Sheets, (iii) Consolidated Statements of Cash Flows, (iv) Consolidated Statements of Comprehensive (Loss) Income, (v) Consolidated Statement of Changes in Stockholders’ Equity and (vi) the Notes to Consolidated Financial Statements, tagged as blocks of text and in detail.
|
(1) |
Incorporated by reference to the Company’s Registration Statement on Form S-1/A (Registration No. 333-123644) filed June 7, 2005.
|
(2) |
Incorporated by reference to the Company’s Form 8-K filed June 28, 2005.
|
(3)
|
Incorporated by reference to the Company’s Registration Statement on Form S-1 (Registration No. 333-123644) filed March 29, 2005.
|
(4) |
Incorporated by reference to the Company’s Registration Statement on Form S-3 (Registration No. 333-148406) filed December 28, 2007.
|
(5) |
Incorporated by reference to the Company’s Registration Statement on Form S-1/A (Registration No. 333-123644) filed June 21, 2005.
|
(6) |
Incorporated by reference to the Company’s Form 8-K filed August 5, 2015.
|
(7) |
Incorporated by reference to the Company’s Form 8-K filed January 7, 2016.
|
(8) |
Incorporated by reference to the Company’s Form 8-K filed March 4, 2016.
|
(9) |
Incorporated by reference to the Company’s Form 8-K filed April 18, 2016.
|
(10) |
Incorporated by reference to the Company’s Quarterly Report on Form 10-Q filed August 9, 2016.
|
(11) |
Incorporated by reference to the Company’s Form 8-K filed May 6, 2015.
|
(12) |
Incorporated by reference to the Company’s Form 8-K filed February 5, 2015.
|
(13) |
Incorporated by reference to the Company’s Form 8-K filed September 3, 2015.
|
(14) |
Incorporated by reference to the Company’s Form 8-K filed August 25, 2016.
|
(15) |
Incorporated by reference to the Company’s Quarterly Report on Form 10-Q filed August 8, 2014.
|
(16) |
Incorporated by reference to the Company’s Form 10-K for the year ended December 31, 2014.
|
(17) |
Incorporated by reference to the Company’s Form 8-K filed January 22, 2016.
|
(18) |
Incorporated by reference to the Company’s Form 8-K filed May 6, 2013.
|
(19) |
Incorporated by reference to the Company’s Registration Statement on Form S-8 (Registration No. 333-211213) filed May 6, 2016.
|
(20) |
Incorporated by reference to the Company’s Annual Report on Form 10-K for the year ended December 31, 2007.
|
(21) |
Incorporated by reference to the Company’s Annual Report on Form 10-K for the year ended December 31, 2012.
|
(22) |
Incorporated by reference to the Company’s Form 8-K filed May 5, 2011.
|
* |
Filed herewith.
|
if to the Company:
|
|
200 Executive Drive, Suite 340
|
|
West Orange, New Jersey 07052
|
|
Attention: General Counsel
|
|
if to the Employee:
|
|
200 Executive Drive, Suite 340
|
|
West Orange, New Jersey 07052
|
LINCOLN EDUCATIONAL SERVICES CORPORATION
|
||
By:
|
/s/ Scott Shaw | |
Name: Scott Shaw
|
||
Title: Chief Executive Officer
|
EMPLOYEE
|
|
/s/ Deborah Ramentol
|
|
Deborah Ramentol
|
(a) |
when a “person” (as defined in Section 3(a)(9) of the Exchange Act), including a “group” (as defined in Section 13(d) and 14(d) of the Exchange Act), either directly or indirectly becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act) of 25% or more of either (i) the then outstanding Common Stock, or (ii) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors; provided, however, that the following acquisitions shall not constitute a Change in Control: (1) any acquisition directly from the Company; (2) any acquisition by the Company; or (3) any acquisition by an employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company;
|
(b) |
when the stockholders of the Company approve a reorganization, merger or consolidation of the Company without the consent or approval of a majority of the Company Incumbent Directors;
|
(c) |
consummation of a merger, amalgamation or consolidation of the Company with any other corporation, the issuance of voting securities of the Company in connection with a merger, amalgamation or consolidation of the Company or sale or other disposition of all or substantially all of the assets of the Company or the acquisition of assets of another corporation (each, a “Business Combination”), unless, in each case of a Business Combination, immediately following such Business Combination, all or substantially all of the individuals and entities who were the beneficial owners of the Common Stock outstanding immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the then outstanding shares of common stock and 50% of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the entity resulting from such Business Combination (including, without limitation, an entity which as a result of such transaction owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination, of the Common Stock; or
|
(d) |
a complete liquidation or dissolution of the Company or the sale or other disposition of all or substantially all of the assets of the Company;
|
Name
|
Jurisdiction
|
Lincoln Technical Institute, Inc. (wholly owned)
|
New Jersey
|
New England Acquisition LLC (wholly owned through Lincoln Technical Institute, Inc.)
|
Delaware
|
Southwestern Acquisition LLC (wholly owned through Lincoln Technical Institute, Inc.)
|
Delaware
|
Nashville Acquisition, LLC (wholly owned through Lincoln Technical Institute, Inc.)
|
Delaware
|
Euphoria Acquisition, LLC (wholly owned through Lincoln Technical Institute, Inc.)
|
Delaware
|
New England Institute of Technology at Palm Beach, Inc. (wholly owned through Lincoln Technical Institute, Inc.)
|
Florida
|
LTI Holdings, LLC (wholly owned through Lincoln Technical Institute, Inc.)
|
Colorado
|
LCT Acquisition, LLC (wholly owned through Lincoln Technical Institute, Inc.)
|
Delaware
|
NN Acquisition, LLC (wholly owned through Lincoln Technical Institute, Inc.)
|
Delaware
|
1. |
I have reviewed this Annual Report on Form 10-K of Lincoln Educational Services Corporation;
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4. |
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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5. |
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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Date: March 10, 2017
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/s/ Scott Shaw
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Scott Shaw
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Chief Executive Officer
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1. |
I have reviewed this Annual Report on Form 10-K of Lincoln Educational Services Corporation;
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2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4. |
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c) |
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d) |
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an Annual Report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5. |
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date: March 10, 2017
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/s/ Brian Meyers
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Brian Meyers
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Chief Financial Officer
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/s/ Scott Shaw
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Scott Shaw
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Chief Executive Officer
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/s/ Brian Meyers
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Brian Meyers
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Chief Financial Officer
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Document and Entity Information - USD ($) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Mar. 08, 2017 |
Jun. 30, 2016 |
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Document and Entity Information [Abstract] | |||
Entity Registrant Name | LINCOLN EDUCATIONAL SERVICES CORP | ||
Entity Central Index Key | 0001286613 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $ 44,658,126 | ||
Entity Common Stock, Shares Outstanding | 24,719,105 | ||
Document Fiscal Year Focus | 2016 | ||
Document Fiscal Period Focus | FY | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2016 |
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
CURRENT ASSETS: | ||
Accounts receivable, allowance | $ 9,887 | $ 9,787 |
PROPERTY, EQUIPMENT AND FACILITIES - accumulated depreciation and amortization | 124,192 | 123,324 |
OTHER ASSETS : | ||
Noncurrent receivables, allowance | $ 765 | $ 837 |
STOCKHOLDERS' EQUITY: | ||
Preferred stock, par value (in dollars per share) | $ 0 | $ 0 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 30,685,017 | 29,727,555 |
Common stock, shares outstanding (in shares) | 30,685,017 | 29,727,555 |
Treasury stock, shares (in shares) | 5,910,541 | 5,910,541 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME [Abstract] | |||
Net loss | $ (28,304) | $ (3,350) | $ (56,133) |
Other comprehensive income (loss) | |||
Employee pension plan adjustments | 971 | 395 | (3,905) |
Comprehensive loss | $ (27,333) | $ (2,955) | $ (60,038) |
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) |
12 Months Ended |
---|---|
Dec. 31, 2014
$ / shares
| |
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY [Abstract] | |
Cash dividend (in dollars per share) | $ 0.18 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
Business Activities— Lincoln Educational Services Corporation and its subsidiaries (collectively, the “Company”, “we”, “our” and “us”, as applicable) provide diversified career-oriented post-secondary education to recent high school graduates and working adults. The Company, which currently operates 28 schools in 15 states, offers programs in automotive technology, skilled trades (which include HVAC, welding and computerized numerical control and electronic systems technology, among other programs), healthcare services (which include nursing, dental assistant, medical administrative assistant and pharmacy technician, among other programs), hospitality services (which include culinary, therapeutic massage, cosmetology and aesthetics) and business and information technology (which includes information technology and criminal justice programs). The schools operate under Lincoln Technical Institute, Lincoln College of Technology, Lincoln College of New England, Lincoln Culinary Institute, and Euphoria Institute of Beauty Arts and Sciences and associated brand names. Most of the campuses serve major metropolitan markets and each typically offers courses in multiple areas of study. Five of the campuses are destination schools, which attract students from across the United States and, in some cases, from abroad. The Company’s other campuses primarily attract students from their local communities and surrounding areas. All of the campuses are nationally or regionally accredited and are eligible to participate in federal financial aid programs by the U.S. Department of Education (the “DOE”) and applicable state education agencies and accrediting commissions which allow students to apply for and access federal student loans as well as other forms of financial aid. In the first quarter of 2015, we reorganized our operations into three reportable business segments: (a) Transportation and Skilled Trades, (b) Healthcare and Other Professions (“HOPS”), and (c) Transitional which refers to businesses that have been or are currently being taught out. In November 2015 the Board of Directors approved a plan for the Company to divest the schools included in the HOPS business segment. Divestiture of the Company’s HOPS business segment marks a strategic shift in business strategy that will enable us to focus energy and resources predominantly on the Transportation and Skilled Trades business segment. The Company continues to actively market the schools comprising the HOPS business segment and has offers which are under consideration. The results of operations of the campuses included in the HOPS business segment are reflected as discontinued operations in the consolidated financial statements. The following table lists the schools that are included in the HOPS and Transitional Segments and their status as of December 31, 2016 and 2015:
Liquidity—For the last several years, the Company and the proprietary school sector have faced deteriorating earnings. Government regulations have negatively impacted earnings by making it more difficult for potential students to obtain loans, which, when coupled with the overall economic environment, have discouraged potential students from enrolling in post-secondary schools. In light of these factors, the Company has incurred significant operating losses as a result of lower student population. Despite these events, the Company believes that its likely sources of cash should be sufficient to fund operations for the next twelve months. At December 31, 2016, the Company’s sources of cash primarily included cash and cash equivalents of $47.7 million (of which $26.7 million is restricted). The Company is also continuing to take actions to improve cash flow by aligning its cost structure to its student population. In addition to the current sources of capital discussed above that provides short term liquidity, the Company plans to sell approximately $13.2 million in assets net of liabilities, which are currently classified as held for sale and are expected to be sold within one year from the date of classification in which up to $10 million will be required to pay down debt. The Company continues to actively market these schools and has offers which are under consideration. Principles of Consolidation—The accompanying consolidated financial statements include the accounts of Lincoln Educational Services Corporation and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated. Revenue Recognition— Revenues are derived primarily from programs taught at the Company’s schools. Tuition revenues, textbook sales and one-time fees, such as nonrefundable application fees and course material fees, are recognized on a straight-line basis over the length of the applicable program as the student proceeds through the program, which is the period of time from a student’s start date through his or her graduation date, including internships or externships that take place prior to graduation, and the Company completes the performance of teaching the student which entitles the Company to the revenue. Other revenues, such as tool sales and contract training revenues are recognized as services are performed or goods are delivered. On an individual student basis, tuition earned in excess of cash received is recorded as accounts receivable, and cash received in excess of tuition earned is recorded as unearned tuition. Refunds are calculated and paid in accordance with federal, state and accrediting agency standards. The Company evaluates whether collectability of revenue is reasonably assured prior to the student attending class and reassesses collectability of tuition and fees when a student withdraws from a course. The Company calculates the amount to be returned under Title IV and its stated refund policy to determine eligible charges and, if there is a balance due from the student after this calculation, the Company expect payment from the student and the Company has a process to pursue uncollected accounts whereby, based upon the student’s financial means and ability to pay, a payment plan is established with the student to ensure that collectability is reasonable. The Company continuously monitors its historical collections to identify potential trends that may impact our determination that collectability of receivables for withdrawn students is realizable. If a student withdraws from a program prior to a specified date, any paid but unearned tuition is refunded. Refunds are calculated and paid in accordance with federal, state and accrediting agency standards. Generally, the amount to be refunded to a student is calculated based upon the period of time the student has attended classes and the amount of tuition and fees paid by the student as of his or her withdrawal date. These refunds typically reduce deferred tuition revenue and cash on our consolidated balance sheets as the Company generally does not recognize tuition revenue in its consolidated statements of income (loss) until the related refund provisions have lapsed. Based on the application of its refund policies, the Company may be entitled to incremental revenue on the day the student withdraws from one of its schools. Prior to the year-ended December 31, 2015, the Company recorded this incremental revenue, any related student receivable and any estimate of the amount it did not expect to collect as bad debt expense during the quarter a student withdrew based on its analysis of the collectability of such amounts on an aggregate student portfolio basis, for which the Company had significant historical experience. Beginning in October 2015, the Company recorded revenue for students who withdraw from one of its schools when payment is received because collectability on an individual student basis is not reasonably assured. The Company determined incremental revenue recognized for students who withdrew during the nine-months ended September 30, 2015 to be an immaterial error which was corrected during the fourth quarter of 2015. This resulted in a reduction of net revenues by $0.3 million and bad debt expense by $0.2 million, which resulted in an increase to the loss from continuing operations of $0.1 million for the year ended December 31, 2015. Additionally, this correction reduced net student receivables from continuing operations by $0.1 million. Prior year amounts, including quarterly financial results were not restated because the effects were not material. Cash and Cash Equivalents—Cash and cash equivalents include all cash balances and highly liquid short-term investments, which contain original maturities within three months of purchase. Pursuant to the Department of Education’s cash management requirements, the Company retains funds from financial aid programs under Title IV of the Higher Education Act in segregated cash management accounts. The segregated accounts do not require a restriction on use of the cash and, as such, these amounts are classified as cash and cash equivalents on the consolidated balance sheet. Restricted Cash—Restricted cash consists of deposits maintained at financial institutions under a cash collateralized agreement under the Company’s credit agreement and cash collateralized for letters of credit. $20.3 million of restricted cash is included in long-term assets on the consolidated balance sheet as the restriction is greater than one year. Refer to Note 8 for more information on the Company’s term loan. Accounts Receivable—The Company reports accounts receivable at net realizable value, which is equal to the gross receivable less an estimated allowance for uncollectible accounts. Noncurrent accounts receivable represent amounts due from graduates in excess of 12 months from the balance sheet date. Allowance for uncollectible accounts—Based upon experience and judgment, an allowance is established for uncollectible accounts with respect to tuition receivables. In establishing the allowance for uncollectible accounts, the Company considers, among other things, current and expected economic conditions, a student's status (in-school or out-of-school), whether or not a student is currently making payments, and overall collection history. Changes in trends in any of these areas may impact the allowance for uncollectible accounts. The receivables balances of withdrawn students with delinquent obligations are reserved for based on our collection history. Inventories—Inventories consist mainly of textbooks, computers, tools and supplies. Inventories are valued at the lower of cost or market on a first-in, first-out basis. Property, Equipment and Facilities—Depreciation and Amortization—Property, equipment and facilities are stated at cost. Major renewals and improvements are capitalized, while repairs and maintenance are expensed when incurred. Upon the retirement, sale or other disposition of assets, costs and related accumulated depreciation are eliminated from the accounts and any gain or loss is reflected in operating (loss) income. For financial statement purposes, depreciation of property and equipment is computed using the straight-line method over the estimated useful lives of the assets, and amortization of leasehold improvements is computed over the lesser of the term of the lease or its estimated useful life. Rent Expense—Rent expense related to operating leases where scheduled rent increases exist, is determined by expensing the total amount of rent due over the life of the operating lease on a straight-line basis. The difference between the rent paid under the terms of the lease and the rent expensed on a straight-line basis is included in accrued rent and other long-term liabilities on the accompanying consolidated balance sheets. Advertising Costs—Costs related to advertising are expensed as incurred and approximated $18.2 million, $17.9 million and $18.0 million from continuing operations for the years ended December 31, 2016, 2015 and 2014, respectively. These amounts are included in selling, general and administrative expenses in the consolidated statements of operations. Goodwill and Other Intangible Assets— The Company tests its goodwill for impairment annually, or whenever events or changes in circumstances indicate an impairment may have occurred, by comparing its reporting unit’s carrying value to its implied fair value. Impairment may result from, among other things, deterioration in the performance of the acquired business, adverse market conditions, adverse changes in applicable laws or regulations, reductions in market value of the Company, including changes that restrict the activities of the acquired business, and a variety of other circumstances. If the Company determines that an impairment has occurred, it is required to record a write-down of the carrying value and charge the impairment as an operating expense in the period the determination is made. In evaluating the recoverability of the carrying value of goodwill and other indefinite-lived intangible assets, the Company must make assumptions regarding estimated future cash flows and other factors to determine the fair value of the acquired assets. Changes in strategy or market conditions could significantly impact these judgments in the future and require an adjustment to the recorded balances. At December 31, 2016, the Company conducted its annual test for goodwill impairment and determined it did not have an impairment for continuing operations. The fair value of the Company’s reporting units were determined using Level 3 inputs included in its multiple of earnings and discounted cash flow approach. Our disposal group assets held for sale are required to be measured at the lower of carrying value or fair value less cost to sell. As a result of the consideration of offers received on our disposal group assets held for sale, we concluded that an pre-tax non-cash impairment charge of $9.9 million was required for our goodwill and intangible assets relating to this group ($9.9 million was included in discontinued operations). At December 31, 2016, the Company conducted its annual test for goodwill impairment and determined it did not have an impairment. The fair value of the Company’s reporting units were determined using Level 3 inputs included in its multiple of earnings and discounted cash flow approach. At December 31, 2015, the Company conducted its annual test for goodwill impairment and determined it did not have an impairment. The fair value of the Company’s reporting units were determined using Level 3 inputs included in its multiple of earnings and discounted cash flow approach. The Company concluded that as of September 30, 2015 there was an indicator of potential impairment as a result of a decrease in market capitalization and, accordingly, the Company tested goodwill for impairment. The test indicated that one of the Company’s reporting units was impaired, which resulted in a pre-tax non-cash charge of $0.2 million ($0.2 million of which is included in the transportation and skilled trades segment) for the three months ended September 30, 2015. At December 31, 2014, the Company conducted its annual test for goodwill impairment and determined it did not have an impairment. The fair value of the Company’s reporting units were determined using Level 3 inputs included in its multiple of earnings and discounted cash flow approach. The Company concluded that as of September 30, 2014 there was an indicator of potential impairment as a result of a decrease in market capitalization and, accordingly, the Company tested goodwill for impairment. The test indicated that ten of the Company’s reporting units were impaired, which resulted in a pre-tax non-cash charge of $39.0 million for the three months ended September 30, 2014 ($0.2 million and $38.8 million of which is included in the transportation and skilled trades segment and discontinued operations, respectively). Impairment of Long-Lived Assets—The Company reviews the carrying value of its long-lived assets and identifiable intangibles for possible impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. The Company evaluates long-lived assets for impairment by examining estimated future cash flows using Level 3 inputs. These cash flows are evaluated by using weighted probability techniques as well as comparisons of past performance against projections. Assets may also be evaluated by identifying independent market values. If the Company determines that an asset’s carrying value is impaired, it will record a write-down of the carrying value of the asset and charge the impairment as an operating expense in the period in which the determination is made. The Company concluded that, for the three months ended December 31, 2016, there was sufficient evidence to conclude that there was an impairment of certain long-lived assets at two of the Company’s campuses for continuing operations. The long-lived assets impairment resulted in a pre-tax charge of $3.9 million for land and buildings. Our disposal group assets held for sale are required to be measured at the lower of carrying value or fair value less cost to sell. As a result of the consideration of offers received on our disposal group assets held for sale, we concluded that an impairment charge of $7.6 million was required for our long-lived assets relating to this group ($7.6 million was included in discontinued operations). The Company concluded that for the three months ended December 31, 2015, there was no long-lived asset impairment. Long-lived assets were tested at the campuses as a result of classifying assets held for sale and certain financial indicators such as the Company’s history of losses, current respective period losses, as well as future projected losses at these campuses. The Company concluded that for the three months ended December 31, 2014 and September 30, 2014, there was sufficient evidence to conclude that there was an impairment of certain long-lived assets at one and six of the Company’s campuses, respectively. Long-lived assets had been tested at these campuses as a result of certain financial indicators such as the Company’s history of losses, current respective period losses, as well as future projected losses at these campuses. The long-lived assets impairment resulted in a pre-tax charge of $1.5 million for leasehold improvements ($1.5 million included in the Transportation and Skilled Trades segment) as of December 31, 2014 and $1.9 million for leasehold improvements ($1.5 million and $0.4 million included in the transitional segment and discontinued operations, respectively) and $0.5 million ($0.5 million included in discontinued operations) for intangible assets as of September 30, 2014. Concentration of Credit Risk—Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of temporary cash investments. The Company places its cash and cash equivalents with high credit quality financial institutions. The Company's cash balances with financial institutions typically exceed the Federal Deposit Insurance limit of $0.25 million. The Company's cash balances on deposit at December 31, 2016, exceeded the balance insured by the FDIC Corporation (“FDIC”) by approximately $46.3 million. The Company has not experienced any losses to date on its invested cash. The Company extends credit for tuition and fees to many of its students. The credit risk with respect to these accounts receivable is mitigated through the students' participation in federally funded financial aid programs unless students withdraw prior to the receipt of federal funds for those students. In addition, the remaining tuition receivables are primarily comprised of smaller individual amounts due from students. With respect to student receivables, the Company had no significant concentrations of credit risk as of December 31, 2016 and 2015. Use of Estimates in the Preparation of Financial Statements—The preparation of financial statements in conformity with generally accepted accounting principles in the United States (“GAAP’) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. On an ongoing basis, the Company evaluates the estimates and assumptions, including those related to revenue recognition, bad debts, impairments, fixed assets, income taxes, benefit plans and certain accruals. Actual results could differ from those estimates. Stock-Based Compensation Plans—The Company measures the value of stock options on the grant date at fair value, using the Black-Scholes option valuation model. The Company amortizes the fair value of stock options, net of estimated forfeitures, utilizing straight-line amortization of compensation expense over the requisite service period of the grant. The Company measures the value of service and performance-based restricted stock on the fair value of a share of common stock on the date of the grant. The Company amortizes the fair value of service based restricted stock utilizing straight-line amortization of compensation expense over the requisite service period of the grant. The Company amortizes the fair value of the performance-based restricted stock based on determination of the probable outcome of the performance condition. If the performance condition is expected to be met, then the Company amortizes the fair value of the number of shares expected to vest utilizing straight-line basis over the requisite performance period of the grant. However, if the associated performance condition is not expected to be met, then the Company does not recognize the stock-based compensation expense. Income Taxes—The Company accounts for income taxes in accordance with Financial Accounting Standards Board (“FASB”) ASC Topic 740, “Income Taxes” (“ASC 740”). This statement requires an asset and a liability approach for measuring deferred taxes based on temporary differences between the financial statement and tax bases of assets and liabilities existing at each balance sheet date using enacted tax rates for years in which taxes are expected to be paid or recovered. In accordance with ASC 740, the Company assesses our deferred tax asset to determine whether all or any portion of the asset is more likely than not unrealizable. A valuation allowance is required to be established or maintained when, based on currently available information, it is more likely than not that all or a portion of a deferred tax asset will not be realized. In accordance with ASC 740, our assessment considers whether there has been sufficient income in recent years and whether sufficient income is expected in future years in order to utilize the deferred tax asset. In evaluating the realizability of deferred income tax assets, the Company considered, among other things, historical levels of income, expected future income, the expected timing of the reversals of existing temporary reporting differences, and the expected impact of tax planning strategies that may be implemented to prevent the potential loss of future income tax benefits. Significant judgment is required in determining the future tax consequences of events that have been recognized in our consolidated financial statements and/or tax returns. Differences between anticipated and actual outcomes of these future tax consequences could have a material impact on the Company’s consolidated financial position or results of operations. Changes in, among other things, income tax legislation, statutory income tax rates, or future income levels could materially impact the Company’s valuation of income tax assets and liabilities and could cause our income tax provision to vary significantly among financial reporting periods. The Company recognizes accrued interest and penalties related to unrecognized tax benefits in income tax expense. During the years ended December 31, 2016 and 2015, the interest and penalties expense associated with uncertain tax positions are not significant to the Company’s results of operations or financial position. Start-up Costs—Costs related to the start of new campuses are expensed as incurred. Reclassification—During the year ended December 31, 2016, the Board of Directors approved a plan for the Company to teach-out the West Palm Beach, Florida, Center City Philadelphia, Pennsylvania, and Northeast Philadelphia, Pennsylvania, campuses which are included in the Transitional segment. In addition, during the year ended December 31, 2016, the Henderson (Green Valley), Nevada and Hartford, Connecticut campuses closed and are included in discontinued operations. In 2016, the Company reclassified related held for sale amounts reflected in the 2015 Consolidated Balance Sheet and discontinued operations in Consolidated Statements of Operations. New Accounting Pronouncements In January 2017, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2017-04, "Simplifying the Test for Goodwill Impairment" ("ASU 2017-04"). ASU 2017-04 provides amendments to ASC No. 350, "Intangibles - Goodwill and Other" ("ASC 350"), which eliminate Step 2 from the goodwill impairment test. Entities should perform their goodwill impairment tests by comparing the fair value of a reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value. The amendments in this update are effective prospectively during interim and annual periods beginning after December 15, 2019, with early adoption permitted. The Company is currently assessing the impact of this update on the Company’s Consolidated Financial Statements. The FASB has recently issued several amendments to the new standard on revenue recognition, ASU No. 2014-09, Revenue from Contracts with Customers. The amendments include ASU No. 2016-08, Revenue from Contracts with Customers (Topic 606)—Principal versus Agent Considerations, which was issued in March 2016, and clarifies the implementation guidance for principal versus agent considerations in ASU 2014-09, and ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606)—Identifying Performance Obligations and Licensing, which was issued in April 2016, and amends the guidance in ASU No. 2014-09 related to identifying performance obligations. The new standard permits adoption either by using (i) a full retrospective approach for all periods presented in the period of adoption or (ii) a modified retrospective approach with the cumulative effect of initially applying the new standard recognized at the date of initial application and providing certain additional disclosures. The new standard is effective for annual reporting periods beginning after December 15, 2017, with early adoption permitted for annual reporting periods beginning after December 15, 2016. We do not plan to early adopt, and accordingly, we will adopt the new standard effective January 1, 2018. We currently plan to adopt using the modified retrospective approach. However, a final decision regarding the adoption method has not been finalized at this time. Our final determination will depend on a number of factors, such as the significance of the impact of the new standard on our financial results, system readiness, including that of software procured from third-party providers, and our ability to accumulate and analyze the information necessary to assess the impact on prior period financial statements, as necessary. We are in the initial stages of our evaluation of the impact of the new standard on our accounting policies, processes, and system requirements. We have assigned internal resources to assist in the evaluation. Furthermore, we have made and will continue to make investments in systems to enable timely and accurate reporting under the new standard. While we continue to assess all potential impacts under the new standard, there is the potential for significant impacts to the timing of recognition of revenue. While we continue to assess the potential impacts of the new standard and this standard could have a material impact on our consolidated financial statements, we do not know or cannot reasonably estimate quantitative information related to the impact of the new standard on our financial statements at this time. In November 2016, the FASB issued ASU No. 2016-18: “Statement of Cash Flows (Topic 230): Restricted Cash.” This guidance was issued to address the diversity that exists in the classification and presentation of changes in restricted cash on the statement of cash flows. The amendments will require that the statement of cash flows explain the change during the period in total cash, cash equivalents and restricted cash. The amendments are effective for financial statements issued for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The amendments will be applied using a retrospective transition method to each period presented. The Company anticipates that the adoption will not have a significant impact on the Company’s Consolidated Financial Statements. In August 2016, FASB issued ASU No. 2016-15: “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments” to address eight specific cash flow issues with the objective of reducing the existing diversity in practice. The amendments are effective for financial statements issued for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company anticipates that the adoption will not have a significant impact on the Company’s Consolidated Financial Statements. In February 2016, the FASB issued guidance requiring lessees to recognize a right-of-use asset and a lease liability on the balance sheet for substantially all leases, with the exception of short-term leases. Leases will be classified as either financing or operating, with classification affecting the pattern of expense recognition in the statement of income. The guidance is effective for annual periods, including interim periods within those periods, beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the impact that the update will have on our results of operations, financial condition and financial statement disclosures. In November 2015, the FASB issued guidance which simplifies the balance sheet classification of deferred taxes requiring that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as noncurrent on the balance sheet. This guidance is effective for public business entities for annual periods, and for interim periods within those periods, beginning after December 15, 2016 with early adoption permitted. The Company early adopted as of December 31, 2015. While the guidance does have an impact on our balance sheet classification, it does not have a material impact on our results of operations, financial condition or the financial statement disclosures. In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern that requires management to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures in certain circumstances. According to the standard, substantial doubt about an entity’s ability to continue as a going concern exists if it is probable that the entity will be unable to meet its obligations as they become due within one year after the date the entity’s financial statements are issued. In order to determine the specific disclosures, if any, that would be required, management will need to assess if substantial doubt exists, and, if so, whether its plans will alleviate such substantial doubt. The standard requires assessment each annual and interim period and became effective for the Company on December 31, 2016. |
FINANCIAL AID AND REGULATORY COMPLIANCE |
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FINANCIAL AID AND REGULATORY COMPLIANCE [Abstract] | |||||||||
FINANCIAL AID AND REGULATORY COMPLIANCE |
Financial Aid The Company’s schools and students participate in a variety of government-sponsored financial aid programs that assist students in paying the cost of their education. The largest source of such support is the federal programs of student financial assistance under Title IV of the Higher Education Act of 1965, as amended, commonly referred to as the Title IV Programs, which are administered by the U.S. Department of Education (the "DOE"). During the years ended December 31, 2016, 2015 and 2014, approximately 79%, 80% and 80% respectively, of net revenues on a cash basis were indirectly derived from funds distributed under Title IV Programs. For the years ended December 31, 2016, 2015 and 2014, the Company calculated that no individual DOE reporting entity received more than 90% of its revenue, determined on a cash basis under DOE regulations, from the Title IV Program funds. The Company’s calculations may be subject to review by the DOE. Under DOE regulations, a proprietary institution that derives more than 90% of its total revenue from the Title IV Programs for two consecutive fiscal years becomes immediately ineligible to participate in the Title IV Programs and may not reapply for eligibility until the end of two fiscal years. An institution with revenues exceeding 90% for a single fiscal year, will be placed on provisional certification and may be subject to other enforcement measures. If one of the Company’s institutions violated the 90/10 Rule and became ineligible to participate in Title IV Programs but continued to disburse Title IV Program funds, the DOE would require the institution to repay all Title IV Program funds received by the institution after the effective date of the loss of eligibility. Regulatory Compliance To participate in Title IV Programs, a school must be authorized to offer its programs of instruction by relevant state education agencies, be accredited by an accrediting commission recognized by the DOE and be certified as an eligible institution by the DOE. For this reason, the schools are subject to extensive regulatory requirements imposed by all of these entities. After the schools receive the required certifications by the appropriate entities, the schools must demonstrate their compliance with the DOE regulations of the Title IV Programs on an ongoing basis. Included in these regulations is the requirement that the Company must satisfy specific standards of financial responsibility. The DOE evaluates institutions for compliance with these standards each year, based upon the institution’s annual audited financial statements, as well as following a change in ownership resulting in a change of control of the institution. The DOE calculates the institution's composite score for financial responsibility based on its (i) equity ratio, which measures the institution's capital resources, ability to borrow and financial viability; (ii) primary reserve ratio, which measures the institution's ability to support current operations from expendable resources; and (iii) net income ratio, which measures the institution's ability to operate at a profit. This composite score can range from -1 to +3. The composite score must be at least 1.5 for the institution to be deemed financially responsible without the need for further oversight. If an institution’s composite score is below 1.5, but is at least 1.0, it is in a category denominated by the DOE as “the zone.” Under the DOE regulations, institutions that are in the zone typically may be permitted by the DOE to continue to participate in the title IV programs by choosing one of two alternatives: 1) the “Zone Alternative” under which we are required to make disbursements to students under the Heightened Cash Monitoring 1 (HCM1) payment method and to notify the DOE within 10 days after the occurrence of certain oversight and financial events or 2) submit a letter of credit to the DOE in an amount determined by the DOE and equal to at least 50 percent of the Title IV funds received by our institutions during the most recent fiscal year. Under the HCM1 payment method, the institution is required to make Title IV disbursements to eligible students and parents before it requests or receives funds for the amount of those disbursements from the DOE. As long as the student accounts are credited before the funding requests are initiated, we are permitted to draw down funds through the DOE’s electronic system for grants management and payments for the amount of disbursements made to eligible students. Unlike the Heightened Cash Monitoring 2 (HCM2) and reimbursement payment methods, the HCM1 payment method typically does not require schools to submit documentation to the DOE and wait for DOE approval before drawing down Title IV funds. If a Company’s composite score is below 1.5 for three consecutive years a Company may be able to continue to operate under the Zone Alternative; however, this determination is made solely by the DOE. If a Company’s composite score drops below 1.0 in a given year or if its composite score remains between 1.0 and 1.4 for three or more consecutive years, it may be required to meet alternative requirements for continuing to participate in Title IV programs by submitting a letter of credit, complying with monitoring requirements, disbursing Title IV funds under the HCM1, HCM2, or reimbursement payment methods, and complying with other requirements and conditions. Effective July 1, 2016, a school under HCM1, HCM2 or reimbursement payment methods must also pay any credit balances due to a student before drawing down funds for the amount of those disbursements from the DOE, even if the student or parent provide written authorization for the school to hold the credit balance. The DOE permits an institution to participate under the “Zone Alternative” for a period of up to three consecutive fiscal years; however, this determination is made solely by the DOE. If an institution’s composite score is between 1.0 and 1.4 after three or more consecutive years with a composite score below 1.5, it may be required to meet alternative requirements for continuing to participate in Title IV programs by submitting a letter of credit, complying with monitoring requirements, disbursing Title IV funds under the HCM1, HCM2, or reimbursement payment methods, and complying with other requirements and conditions. If an institution's composite score is below 1.0, the institution is considered by the DOE to lack financial responsibility. If the DOE determines that an institution does not satisfy the DOE's financial responsibility standards, depending on its composite score and other factors, that institution may establish its financial responsibility on an alternative basis by, among other things:
For the 2016 fiscal year, the Company calculated its composite score to be 1.5. The score is subject to determination by the DOE once it receives and reviews the Company’s audited financial statements for the 2016 fiscal year. The DOE has evaluated the financial responsibility of our institutions on a consolidated basis. The Company has submitted to the DOE our audited financial statements for the 2015 and 2014 fiscal year reflecting a composite score of 1.9 and 1.3, respectively, based upon its calculations. |
WEIGHTED AVERAGE COMMON SHARES |
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WEIGHTED AVERAGE COMMON SHARES [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
WEIGHTED AVERAGE COMMON SHARES |
The weighted average number of common shares used to compute basic and diluted income per share for the years ended December 31, 2016, 2015 and 2014, respectively were as follows:
For the year ended December 31, 2016 and 2014, options to acquire 773,078; and 119,722 shares were excluded from the above table because the Company reported a net loss for the year and therefore their impact on reported loss per share would have been antidilutive. For the years ended December 31, 2016, 2015 and 2014, options to acquire 218,167; 391,935; and 795,985 shares; respectively, were excluded from the above table because they have an exercise price that is greater than the average market price of the Company’s common stock and therefore their impact on reported (loss) earnings per share would have been antidilutive. In 2014 and 2013, the Company issued certain members of management performance shares that vest when certain performance conditions are met. As of December 31, 2016, 2015 and 2014 none of these performance conditions were met. Accordingly, 73,827; 152,837; and 360,402 shares of outstanding performance shares have been excluded from the computation of diluted earnings per share for the year ended December 31, 2016, 2015 and 2014, respectively. Refer to Note 9 for more information on performance shares. |
DISCONTINUED OPERATIONS |
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DISCONTINUED OPERATIONS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DISCONTINUED OPERATIONS |
2016/2015 In November 2015, the Board of Directors approved a plan for the Company to divest the schools included in the Healthcare and Other Professions business segment. In December 2015, the Board of Directors approved a plan to cease operations of the school in this segment located in Hartford, Connecticut which closed in the fourth quarter of 2016 and is included in discontinued operations. In addition, in the fourth quarter of 2016, the Board of Directors approved a plan to cease operations at our schools in Henderson (Green Valley), Nevada, Center City Philadelphia, Pennsylvania, Northeast Philadelphia, Pennsylvania and West Palm Beach, Florida. The Henderson, Nevada campus also closed in the fourth quarter of 2016 and is included in discontinued operations. Divestiture of the Company’s Healthcare and Other Professions business segment marks a strategic shift in business strategy that will enable us to focus energy and resources predominantly on Transportation and Skilled Trades segment. The results of operations of the 15 campuses included in Healthcare and Other Professions business segment are reflected as discontinued operations in the consolidated financial statements. The Center City Philadelphia, Pennsylvania, Northeast Philadelphia, Pennsylvania and West Palm Beach, Florida campuses, which were previously included in the Healthcare and Other Professions segment are now included in the Transitional segment and included in continuing operations. Completion of the plan would result in the Company’s operations focused solely on the Transportation and Skilled Trades segment. The results of operations at these campuses for the three year periods ended December 31, 2016 were as follows (in thousands):
Amounts include impairments of goodwill and long-lived assets for these campuses of $17.5 million and $19.0 million for the year ended December 31, 2016 and 2014, respectively. 2014 In December 2014, the Company’s Board of Directors approved a plan to cease operations at five training sites in Florida. The Company performed a cost benefit analysis on several schools and concluded that the training sites contained a high fixed cost component and have had difficulty attracting enough students due to high competition to maintain a stable profit margin. Accordingly, the Company ceased operations at these campuses as of December 31, 2014. This was a strategic shift to close all of the Company’s training sites and all locations that do not accept Title IV payments. The results of operations of these campuses are reflected as discontinued operations in the consolidated financial statements. The results of operations at these five training sites for the two year periods ended December 31, 2014 were as follows (in thousands):
Amounts include impairments of goodwill and long-lived assets for these campuses of $2.1 million for the year ended December 31, 2014. |
GOODWILL AND OTHER INTANGIBLES |
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GOODWILL AND OTHER INTANGIBLES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
GOODWILL AND OTHER INTANGIBLES |
Changes in the carrying amount of goodwill during the years ended December 31, 2016 and 2015 are as follows:
As of December 31, 2016 and 2015 the goodwill balance of $14.5 million is related to the Transportation and Skilled Trades Segment. The goodwill related to the Healthcare and Other Professions Segment of $8.8 million was included in assets held for sale as of December 31, 2015 and was fully impaired as of December 31, 2016. Intangible assets, which are included in other assets in the accompanying consolidated balance sheets, consisted of the following:
Amortization of intangible assets for the years ended December 31, 2016, 2015 and 2014 was approximately $0.1 million, $0.1 million and $0.2 million, respectively. The following table summarizes the estimated future amortization expense:
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PROPERTY, EQUIPMENT AND FACILITIES |
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PROPERTY, EQUIPMENT AND FACILITIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROPERTY, EQUIPMENT AND FACILITIES |
Property, equipment and facilities consist of the following:
(a) Amounts are reduced by a $1.4 million impairment charge in 2016 related to a property in Suffield, Connecticut. Depreciation and amortization expense of property, equipment and facilities was $10.9 million, $10.2 million and $14.5 million for the years ended December 31, 2016, 2015 and 2014, respectively. As discussed in Note 4, the Board of Directors approved a plan for the Company to divest schools included in its Healthcare and Other Professions business segment. In addition in 2016, the Board of Directors approved a plan to close the West Palm Beach, Florida schools and for the Company to sell owned the real estate in West Palm Beach, Florida. The Company anticipates that these properties will be sold during 2017. Accordingly, the assets have been reflected as held for sale in the accompanying consolidated balance sheet. The assets and liabilities held for sale consist of the following:
(b) Amount is reduced by a $2.5 million impairment charge in 2016 related to a property in West Palm Beach, Florida. (c) Amount is reduced by a $7.6 million impairment charge in 2016 related to long-lived assets. (d) Amount is reduced by an $8.8 million impairment charge in 2016 related to goodwill. (e) Amount is reduced by a $1.1 million impairment charge in 2016 related to indefinite-lived assets. |
ACCRUED EXPENSES |
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ACCRUED EXPENSES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ACCRUED EXPENSES |
Accrued expenses consist of the following:
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LONG-TERM DEBT AND LEASE OBLIGATIONS |
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LONG-TERM DEBT AND LEASE OBLIGATIONS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LONG-TERM DEBT AND LEASE OBLIGATIONS |
Long-term debt and lease obligations consist of the following:
(a) On July 31, 2015, the Company entered into a credit agreement with three lenders, Alostar Bank of Commerce (“Alostar”), HPF Holdco, LLC and Rushing Creek 4, LLC, led by HPF Service, LLC, as administrative agent and collateral agent (the “Agent”), for an aggregate principal amount of $45 million (the “Term Loan”). The July 31, 2015 credit agreement, along with subsequent amendments to the Credit Agreement dated December 31, 2015 and February 29, 2016, are collectively referred to as the “Credit Agreement.” As of December 31, 2015 and prior to the effectiveness of a second amendment to the Credit Agreement on February 29, 2016 (the “Second Amendment”), the Term Loan consisted of a $30 million term loan (the “Term Loan A”) from HPF Holdco, LLC, Rushing Creek 4, LLC and Tiger Capital Group, LLC, secured by a first priority lien in favor of the Agent on substantially all of the real and personal property owned by the Company, and a $15 million term loan (the “Term Loan B”) from Alostar secured by a $15.3 million cash collateral account. Pursuant to the Second Amendment, the Company received an additional $5 million term loan from Alostar with which the Company repaid $5 million of the principal amount of the Term Loan A. Accordingly, upon the effectiveness of the Second Amendment, the aggregate term loans outstanding under the Credit Agreement remains at approximately $45 million, consisting of an approximate $25 million Term Loan A and a $20 million Term Loan B. In addition, pursuant to the Second Amendment, the amount of cash collateral securing the Term Loan B was increased to $20.3 million. At the Company’s request, a percentage of the cash collateral may be released to the Company at the Agent’s sole discretion and with the consent of Alostar upon the satisfaction of certain criteria as outlined in the Credit Agreement. The Term Loan, which matures on July 31, 2019, replaces a previously existing $20 million revolving credit facility with Bank of America, N.A. and other lenders, which was due to expire on April 5, 2016. The previously existing revolving credit facility was terminated concurrently with the effective date of the Credit Agreement on July 31, 2015 (the “Closing Date”). A portion of the proceeds of the Term Loan were used by the Company to (i) repay approximately $6.3 million in outstanding principal, accrued interest and fees due under the previously existing revolving credit facility, (ii) fund the $20.3 million cash collateral account securing the portion of the Term Loan provided by Alostar, (iii) fund approximately $7.4 million in a cash collateral account securing the letters of credit issued under the previously existing revolving credit facility that remain outstanding after the termination of that facility and (iv) pay transaction expenses in connection with the Term Loan and the termination of the previously existing revolving credit facility. The remaining proceeds of the Term Loan of approximately $11 million may be used by the Company to finance capital expenditures and for general corporate purposes consistent with the terms of the Credit Agreement. Interest will accrue on the Term Loan at a per annum rate equal to the greater of (i) 11% or (ii) 90-day LIBOR plus 9% determined monthly by the Agent and will be payable monthly in arrears. The principal balance of the Term Loan will be repaid in equal monthly installments, commencing on August 1, 2017, determined as the quotient of (i) 10% of the outstanding principal balance of the Term Loan as of July 2, 2017 divided by (ii) 12. A final installment of principal and all accrued and unpaid interest will be due on the maturity date of the Term Loan. The Term Loan may be prepaid in whole or in part at any time, subject to the payment of a prepayment premium equal to (i) 5% of the principal amount prepaid at any time up to but not including the second anniversary of the Closing Date and (ii) 3% of the principal amount prepaid at any time commencing on the second anniversary of the Closing Date up to but not including the third anniversary of the Closing Date. In the event of any sale or other disposition of a school or real property by the Company permitted under the Term Loan, the net proceeds of such sale or disposition must be used to prepay the Loan in an amount determined pursuant to the Credit Agreement, subject to the applicable prepayment premium; provided, however, that no prepayment premium will be due with respect to up to $15 million of aggregate repayments of the Term Loan made during the first year that the Term Loan is outstanding. A portion of the net cash proceeds of any disposition of a school in an amount determined pursuant to the terms of the Term Loan, must be deposited and held as cash collateral in a deposit account controlled by the Agent until the conditions for release set forth in the Term Loan are satisfied. In connection with the assets which are currently classified as held for sale and are expected to be sold within one year, the Company is required to classify $10 million as short term debt due to the Term Loan prepayment minimum required with respect to any such disposition. The Term Loan contains customary representations, warranties and covenants such as minimum financial responsibility composite score, cohort default rate, and other financial covenants, including minimum liquidity, maximum capital expenditures, maximum 90/10 ratio and minimum EBITDA (as defined in the Term Loan), as well as affirmative and negative covenants and events of default customary for facilities of this type. The Company was in compliance with all covenants as of December 31, 2016. Subsequent to the 2015 fiscal year end, pursuant to the Second Amendment, the financial covenants were adjusted and, at the Company’s election, will be adjusted for fiscal year 2017 and for each subsequent fiscal year until the maturity of the Term Loan at either the levels applicable to fiscal year 2016 (and each fiscal quarter thereof) contained in the Credit Agreement as of the Closing Date or the levels applicable to fiscal year 2016 (and each fiscal quarter thereof) contained in the Second Amendment. The Company elected to re-set the financial covenants at the 2016 covenant levels contained in the Second Amendment and as required paid $4 million before January 15, 2017, without prepayment penalty. In addition, in February 2017 the Company elected to repay $5 million of restricted cash without prepayment penalty. The Credit Agreement contains events of default, the occurrence and continuation of which provide the Company’s lenders with the right to exercise remedies against the Company and the collateral securing the Term Loan, including the Company’s cash. These events of default include, among other things, the Company’s failure to pay any amounts due under the Term Loan, a breach of covenants under the Credit Agreement, the Company’s insolvency and the insolvency of its subsidiaries, the occurrence of a material adverse effect, the occurrence of any default under certain other indebtedness, and a final judgment against the Company in an amount greater than $1 million. Also, in connection with the Term Loan, the Company paid to the Agent a commitment fee of $1 million on the Closing Date and is required to pay to the Agent other customary fees for facilities of this type. Total fees for the Term Loan were $2.8 million during fiscal year 2015. During the first quarter of 2016, in connection with the effectiveness of the Second Amendment, the Company paid loan modification fees of $0.5 million. These deferred finance fees are netted against the Term Loan on the Consolidated Balance Sheets and amortized to interest expense on the Consolidated Statement of Operations. As of December 31, 2016 and December 31, 2015, the Company had $44.3 million and $44.7 million outstanding under the Term Loan; offset by $2.3 million and $2.5 million of deferred finance fees, respectively. (b) The Company completed a sale and a leaseback of four facilities on December 28, 2001. The Company retained a continuing involvement in the lease and, as a result, the Company was prohibited from utilizing sale-leaseback accounting. Accordingly, the Company had treated this transaction as a finance lease. In January 2016, the lease was amended to cure certain provisions related to continuing involvement and, as a consequence, achieved sales treatment. In the first quarter of 2016, the lease was converted to an operating lease and rent payments are included in educational, services and facilities expense in the Consolidated Statement of Operations. In addition, the finance obligation, net of land and buildings, was amortized on the straight-line basis through December 31, 2016. (c) In 2009, the Company assumed a real estate capital lease for a property located in Fern Park, Florida having a term continuing through October 31, 2032. In February 2015, the Company’s Board of Directors approved a plan to cease operations of its school located at the Fern Park, Florida property, which school closed in the first quarter of 2016. In connection with the closure of the school the Company paid a $2.8 million lease termination fee to the landlord in connection with the amendment and early termination of the 2009 lease agreement. The amended lease agreement subsequently expired on April 10, 2016. In December 2015, the Company’s Board of Directors approved a plan to cease operations at the Hartford, Connecticut school which closed in the fourth quarter of 2016. In connection therewith, the Company paid a $5 million lease termination fee to its landlord in connection with the early termination of a lease agreement under which the Company leased property in Hartford, Connecticut for a term continuing through July 31, 2031. (d) On April 12, 2016, the Company entered into a credit agreement (the “L/C Agreement”) with Sterling National Bank (“Sterling”) under which Sterling has agreed to issue letters of credit from time to time at 100% margin against available funds in a cash collateral account maintained by the Company at Sterling. The maximum availability under the L/C Agreement is $9.5 million. The Company will pay Sterling a letter of credit fee equal to 1.75% on the daily amount available to be drawn under each outstanding letter of credit, which fee is payable in quarterly installments in arrears. The L/C Agreement matures on April 1, 2017 and replaces a letter of credit facility with a prior lender. The L/C Agreement contains representations, warranties, affirmative and negative covenants and events of default customary for facilities of this type. As of December 31, 2016 there were letters of credit in the aggregate principal amount of $6.1 million outstanding under the L/C Agreement. Scheduled maturities of long-term debt and lease obligations at December 31, 2016 are as follows:
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STOCKHOLDERS' EQUITY |
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STOCKHOLDERS' EQUITY [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STOCKHOLDERS' EQUITY |
Restricted Stock The Company has two stock incentive plans: a Long-Term Incentive Plan (the “LTIP”) and a Non-Employee Directors Restricted Stock Plan (the “Non-Employee Directors Plan”). Under the LTIP, certain employees received awards of restricted shares of common stock based on service and performance. The number of shares granted to each employee is based on the fair market value of a share of common stock on the date of grant. On May 13, 2016, performance-based shares were granted which vest over two years on March 15, 2017 and March 15, 2018 based upon the attainment of a financial responsibility ratio during each fiscal year ending December 31, 2016 and 2017. There is no restriction on the right to vote or the right to receive dividends with respect to any of the restricted shares. On June 2, 2014 and December 18, 2014, performance-based shares were granted which vest over three years based upon the attainment of (i) a specified operating income margin during any one or more of the fiscal years in the period beginning January 1, 2015 and ending December 31, 2017 and (ii) the attainment of earnings before interest, taxes, depreciation and amortization targets during each of the fiscal years ended December 31, 2015 through 2017. There is no restriction on the right to vote or the right to receive dividends with respect to any of the restricted shares. On April 29, 2013, performance-based shares were granted which vest over four years based upon the attainment of (i) a specified operating income margin during any one or more of the fiscal years in the period beginning January 1, 2013 and ending December 31, 2016 and (ii) the attainment of earnings before interest, taxes, depreciation and amortization targets during each of the fiscal years ended December 31, 2013 through 2016. There is no restriction on the right to vote or the right to receive dividends with respect to any of the restricted shares. Pursuant to the Non-Employee Directors Plan, each non-employee director of the Company receives an annual award of restricted shares of common stock on the date of the Company’s annual meeting of shareholders. The number of shares granted to each non-employee director is based on the fair market value of a share of common stock on that date. There is no restriction on the right to vote or the right to receive dividends with respect to any of the restricted shares. In 2016, 2015 and 2014, the Company completed a net share settlement for 71,805, 85,740 and 144,983 restricted shares and stock options exercised, respectively, on behalf of certain employees that participate in the LTIP upon the vesting of the restricted shares pursuant to the terms of the LTIP or exercise of the stock options. The net share settlement was in connection with income taxes incurred on restricted shares or stock option exercises that vested and were transferred to the employee during 2016, 2015 and/or 2014, creating taxable income for the employee. At the employees’ request, the Company will pay these taxes on behalf of the employees in exchange for the employees returning an equivalent value of restricted shares or stock options to the Company. These transactions resulted in a decrease of approximately $0.2 million, $0.2 million and $0.4 million in 2016, 2015 and 2014, respectively, to equity as the cash payment of the taxes effectively was a repurchase of the restricted shares or stock options granted in previous years. The following is a summary of transactions pertaining to restricted stock:
The restricted stock expense for each of the years ended December 31, 2016, 2015 and 2014 was $1.4 million, $1.1 million and $2.5 million, respectively. The unrecognized restricted stock expense as of December 31, 2016 and 2015 was $1.5 million and $1.3 million, respectively. As of December 31, 2016, unrecognized restricted stock expense will be expensed over the weighted-average period of approximately 1.9 years. As of December 31, 2016, outstanding restricted shares under the LTIP had an aggregate intrinsic value of $2.2 million. For the year ended December 31, 2016, 26,200 shares were cancelled as the performance criteria was not met. Stock Options During 2016, 2015 and 2014 there were no new stock option grants. The following is a summary of transactions pertaining to the option plans:
As of December 31, 2016, there are no unrecognized pre-tax compensation expense for unvested stock option awards. The following table presents a summary of options outstanding at December 31, 2016:
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PENSION PLAN |
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PENSION PLAN [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PENSION PLAN |
The Company sponsors a noncontributory defined benefit pension plan covering substantially all of the Company's union employees. Benefits are provided based on employees' years of service and earnings. This plan was frozen on December 31, 1994 for non-union employees. The following table sets forth the plan's funded status and amounts recognized in the consolidated financial statements:
For the year ended December 31, 2016, the actuarial gain of $0.3 million was due to the decrease in the discount rate from 3.94% to 3.81%. Amounts recognized in the consolidated balance sheets consist of:
Amounts recognized in accumulated other comprehensive loss consist of:
The accumulated benefit obligation was $22.9 million and $23.3 million at December 31, 2016 and 2015, respectively. The following table provides the components of net periodic cost for the plan:
The estimated net loss, transition obligation and prior service cost for the plan that will be amortized from accumulated other comprehensive loss into net periodic benefit cost over the next year is $0.9 million. The following tables present plan assets using the fair value hierarchy as of December 31, 2016 and 2015. The fair value hierarchy has three levels based on the reliability of inputs used to determine fair value. Level 1 refers to fair values determined based on quoted prices in active markets for identical assets. Level 2 refers to fair values estimated using observable prices that are based on inputs not quoted in active markets but observable by market data, while Level 3 includes the fair values estimated using significant non-observable inputs. The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
Fair value of total plan assets by major asset category as of December 31:
Weighted-average assumptions used to determine benefit obligations as of December 31:
Weighted-average assumptions used to determine net periodic pension cost for years ended December 31:
As this plan was frozen to non-union employees on December 31, 1994, the difference between the projected benefit obligation and accumulated benefit obligation is not significant in any year. The Company invests plan assets based on a total return on investment approach, pursuant to which the plan assets include a diversified blend of equity and fixed income investments toward a goal of maximizing the long-term rate of return without assuming an unreasonable level of investment risk. The Company determines the level of risk based on an analysis of plan liabilities, the extent to which the value of the plan assets satisfies the plan liabilities and the plan's financial condition. The investment policy includes target allocations ranging from 30% to 70% for equity investments, 20% to 60% for fixed income investments and 0% to 10% for cash equivalents. The equity portion of the plan assets represents growth and value stocks of small, medium and large companies. The Company measures and monitors the investment risk of the plan assets both on a quarterly basis and annually when the Company assesses plan liabilities. The Company uses a building block approach to estimate the long-term rate of return on plan assets. This approach is based on the capital markets assumption that the greater the volatility, the greater the return over the long term. An analysis of the historical performance of equity and fixed income investments, together with current market factors such as the inflation and interest rates, are used to help make the assumptions necessary to estimate a long-term rate of return on plan assets. Once this estimate is made, the Company reviews the portfolio of plan assets and makes adjustments thereto that the Company believes are necessary to reflect a diversified blend of equity and fixed income investments that is capable of achieving the estimated long-term rate of return without assuming an unreasonable level of investment risk. The Company also compares the portfolio of plan assets to those of other pension plans to help assess the suitability and appropriateness of the plan's investments. The Company does not expect to make contributions to the plan in 2017. However after considering the funded status of the plan, movements in the discount rate, investment performance and related tax consequences, the Company may choose to make additional contributions to the plan in any given year. The total amount of the Company’s contributions paid under its pension plan was zero for the each of the years ended December 31, 2016 and 2015, respectively. Information about the expected benefit payments for the plan is as follows:
The Company has a 401(k) defined contribution plan for all eligible employees. Employees may contribute up to 25% of their compensation into the plan. The Company may contribute an up to an additional 30% of the employee's contributed amount up to 6% of compensation. For the years ended December 31, 2016, 2015 and 2014, the Company's expense for the 401(k) plan amounted to $0.7 million, $0.7 million and $1.6 million, respectively. |
INCOME TAXES |
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INCOME TAXES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME TAXES |
Components of the provision for income taxes from continuing operations were as follows:
The components of the deferred tax assets are as follows:
Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. A significant piece of objective negative evidence was the cumulative losses incurred by the Company in recent years. On the basis of this evaluation the Company believes it is not more likely than not that it will realize its net deferred tax assets. As a result, as of December 31, 2016 and 2015, the Company has recorded a valuation allowance of $54.6 million and $43.9 million, respectively, against its net deferred tax assets. The difference between the actual tax provision and the tax provision that would result from the use of the Federal statutory rate is as follows:
As of December 31, 2016 and 2015, the Company has NOL carryforwards of $39.7 million and $32.6 million, respectively, which, if unused, will expire beginning in 2027 and ending in 2036. Utilization of the NOL carryforwards may be subject to a substantial limitation due to ownership change limitations that may occur in the future, as required by Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”), as well as similar state and foreign provisions. These ownership changes may limit the amount of NOL and tax credit carryforwards that can be utilized annually to offset future taxable income and tax, respectively. In general, an “ownership change” as defined by Section 382 of the Code results from a transaction or series of transactions over a three-year period resulting in an ownership change of more than 50 percentage points of the outstanding stock of a company by certain stockholders or public groups. The following table summarizes the activity related to the Company’s uncertain tax positions:
As of December 31, 2016, 2015 and 2014, the Company no longer has any liability for uncertain tax positions. The Company recognizes accrued interest and penalties related to uncertain tax positions in income tax expense. The Company or one of its subsidiaries files income tax returns in the U.S. federal jurisdiction, and various states. The Company is no longer subject to U.S. federal income tax examinations for years before 2014 and, generally, is no longer subject to state and local income tax examinations by tax authorities for years before 2011. |
FAIR VALUE |
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FAIR VALUE [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE |
The carrying amount and estimated fair value of the Company’s financial instrument assets and liabilities, which are not measured at fair value on the Consolidated Balance Sheets, are listed in the table below:
The fair value of the Term loan is estimated based on a present value analysis utilizing aggregate market yields obtained from independent pricing sources for similar financial instruments. The carrying amounts reported on the Consolidated Balance Sheets for Cash and cash equivalents, Restricted cash and Noncurrent restricted cash approximate fair value because they are highly liquid. The carrying amounts reported on the Consolidated Balance Sheets for Prepaid expenses and other current assets, Accrued expenses and Other short term liabilities approximate fair value due to the short-term nature of these items. |
SEGMENT REPORTING |
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SEGMENT REPORTING [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENT REPORTING |
The for-profit education industry has been impacted by numerous regulatory changes, the changing economy and an onslaught of negative media attention. As a result of these actions, student populations have declined and operating costs have increased. Over the past few years, the Company has closed over ten locations and exited its online business. On November 3, 2015, the Board of Directors approved a plan for the divestiture of the Company’s schools included in the Healthcare and Other Professions business segment. In December 2015, the Board of Directors approved a plan to cease operations of the school located in Hartford, Connecticut which closed in the fourth quarter of 2016. Then, in the fourth quarter of 2016, the Board of Directors approved plans to cease operations at our schools in Henderson (Green Valley), Nevada, Center City Philadelphia, Pennsylvania, Northeast Philadelphia, Pennsylvania and West Palm Beach, Florida. The Henderson, Nevada campus closed in the fourth quarter of 2016. Divestiture of the Company’s Healthcare and Other Professions business segment marks a strategic shift in business strategy. The results of operations of the 15 campuses included in Healthcare and Other Professions business segment are reflected as discontinued operations in the consolidated financial statements. The Center City Philadelphia, Pennsylvania, Northeast Philadelphia, Pennsylvania and West Palm Beach, Florida campuses, which were previously included in the Healthcare and Other Professions segment are now included in the Transitional segment except the West Palm Beach, Florida properties which remain held-for-sale. Implementation of the plan would result in the Company’s operations focused solely on the Transportation and Skilled Trades segment. In the past, we offered any combination of programs at any campus. We have changed our focus to program offerings that create greater differentiation and attain excellence to attract more students and gain market share. Also strategically, we began offering continuing education training to employers who hire our students and this is best achieved at campuses focused on their profession. As a result of the regulatory environment, market forces and strategic decisions, we now operate in two reportable segments: a) Transportation and Skilled Trades and b) Transitional. Our reportable segment represents a group of post-secondary education providers that offer a variety of degree and non-degree academic programs. These segments are organized by key market segments to enhance operational alignment within each segment to more effectively execute our strategic plan. Each of the Company’s schools is a reporting unit and an operating segment which have been determined based on a method by which we evaluate performance and allocate resources. Our operating segments have been aggregated into two reportable segments because, in our judgment, the operating segments have similar services, types of customers, regulatory environment and economic characteristics. Our reportable segments are described below. Transportation and Skilled Trades – Transportation and Skilled Trades offers academic programs mainly in the career-oriented disciplines of transportation and skilled trades (e.g. automotive, diesel, HVAC, welding and manufacturing). Transitional – Transitional refers to operations that are being phased out and consists of our campuses that are currently being taught out. These schools are employing a gradual teach-out process that enables the schools to continue to operate while current students complete their course of study. These schools are no longer enrolling new students. During the year ended December 31, 2016 the Company had announced the closing of our Northeast Philadelphia, Pennsylvania; Center City, Pennsylvania; and West Palm Beach, Florida facilities. These schools are expected to be fully taught out on August 31, 2017, August 31, 2017, and September 30, 2017 respectively. In the first quarter of 2016, we had completed the teach-out of our Fern Park, Florida campus. We evaluate segment performance based on operating results. Adjustments to reconcile segment results to consolidated results are included under the caption “Corporate,” which primarily includes unallocated corporate activity. Summary financial information by reporting segment is as follows:
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COMMITMENTS AND CONTINGENCIES |
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COMMITMENTS AND CONTINGENCIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
COMMITMENTS AND CONTINGENCIES |
Lease Commitments—The Company leases office premises, educational facilities and various equipment for varying periods through the year 2030 at basic annual rentals (excluding taxes, insurance, and other expenses under certain leases) as follows:
Rent expense, included in operating expenses in the accompanying consolidated statements of operations for the three years ended December 31, 2016, 2015 and 2014 is $12.0 million, $10.9 million and $11.1 million, respectively. Litigation and Regulatory Matters— In the ordinary conduct of our business, we are subject to periodic lawsuits, investigations and claims, including, but not limited to, claims involving students or graduates and routine employment matters. Although we cannot predict with certainty the ultimate resolution of lawsuits, investigations and claims asserted against us, we do not believe that any currently pending legal proceeding to which we are a party will have a material effect on our business, financial condition, results of operations or cash flows. On November 21, 2012, the Company received a Civil Investigative Demand from the Attorney General of the Commonwealth of Massachusetts relating to its investigation of whether the Company and certain of its academic institutions have complied with certain Massachusetts state consumer protection laws. On July 29, 2013, and January 17, 2014, the Company received additional Civil Investigative Demands pursuant to which the Attorney General requested from the Company and certain of its academic institutions in Massachusetts documents and detailed information for the time period from January 1, 2008 to the present. On July 13, 2015, the Commonwealth of Massachusetts filed a complaint against the Company in the Suffolk County Superior Court alleging certain violations of the Massachusetts Consumer Protection Act since at least 2010 and continuing through 2013. At the same time, the Company agreed to the entry of a Final Judgment by Consent in order to avoid the time, burden, and expense of contesting such liability. As part of the Final Judgment by Consent, the Company denied all allegations of wrongdoing and any liability for the claims asserted in the complaint. The Company, however, paid the sum of $850,000 to the Attorney General and has agreed to forgive $165,000 of debt consisting of unpaid balances owed to the Company by certain graduates in the sole discretion of the Massachusetts Attorney General. The Final Judgment by Consent also provided certain requirements for calculation of job placement rates in Massachusetts and imposed certain disclosure obligations that are consistent with the regulations that have been previously enacted by the Massachusetts Attorney General’s Office. On December 15, 2015, the Company received an administrative subpoena from the Attorney General of the State of Maryland. Pursuant to the subpoena, Maryland’s Attorney General has requested from the Company documents and detailed information relating to its Columbia, Maryland campus. The Company has responded to this request and intends to continue cooperating with the Maryland Attorney General’s Office. Student Loans—At December 31, 2016, the Company had outstanding net loan commitments to its students to assist them in financing their education of approximately $30.0 million. Vendor Relationship—The Company is party to an agreement with Matco Tools (“Matco”), which expires on July 31, 2019. The Company has agreed to grant Matco exclusive access to 12 campuses and its students and instructors. This exclusivity includes but is not limited to, all other tool manufacturers and/or tool distributors, by whatever means, during the term of the agreement. Under the agreement, the Company will be provided, on an advance commission basis, credits which are redeemable in branded tools, tools storage, equipment, and diagnostics products over the term of the contract. The Company is party to an agreement with Snap-on Industrial (“Snap-on”), which expires on December 31, 2018. The Company has agreed to grant Snap-on exclusive rights to one automotive campus to display advertising and supply certain tools. The Company earns credits that are redeemable for certain tools and equipment based on the sales to students and to the Company. Executive Employment Agreements—The Company entered into employment contracts with key executives that provide for continued salary payments if the executives are terminated for reasons other than cause, as defined in the agreements. The future employment contract commitments for such employees were approximately $3.1 million at December 31, 2016. Change in Control Agreements—In the event of a change of control several key executives will receive continued salary payments based on their employment agreements. Surety Bonds—Each of the Company’s campuses must be authorized by the applicable state education agency in which the campus is located to operate and to grant degrees, diplomas or certificates to its students. The campuses are subject to extensive, ongoing regulation by each of these states. In addition, the Company’s campuses are required to be authorized by the applicable state education agencies of certain other states in which the campuses recruit students. The Company is required to post surety bonds on behalf of its campuses and education representatives with multiple states to maintain authorization to conduct its business. At December 31, 2016, the Company has posted surety bonds in the total amount of approximately $14.3 million. |
RELATED PARTY |
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Dec. 31, 2016 | |||
RELATED PARTY [Abstract] | |||
RELATED PARTY |
The Company has an agreement with MATCO Tools, whereby MATCO will provide to the Company, on an advance commission basis, credits in MATCO-branded tools, tool storage, equipment, and diagnostics products. The CEO of the parent company of MATCO is considered an immediate family member of one of the Company’s board members. The Company’s purchases from this third party were $1.0 million for the year ended December 31, 2016. Management believes that such transactions are at arm’s length and on similar terms as would have been obtained from unaffiliated third parties. |
UNAUDITED QUARTERLY FINANCIAL INFORMATION |
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UNAUDITED QUARTERLY FINANCIAL INFORMATION [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
UNAUDITED QUARTERLY FINANCIAL INFORMATION |
The following tables have been updated to reflect changes in discontinued operations. Quarterly financial information for 2016 and 2015 is as follows:
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DIVIDENDS |
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DIVIDENDS [Abstract] | |||
DIVIDENDS |
During 2014, the Board of Directors declared cash dividends of $0.18 per share of common stock outstanding. On February 27, 2015, the Board of Directors discontinued the quarterly cash dividend. |
Schedule II-Valuation and Qualifying Accounts |
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule II-Valuation and Qualifying Accounts [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule II-Valuation and Qualifying Accounts | Schedule II—Valuation and Qualifying Accounts (in thousands, continuing and discontinued operations)
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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) |
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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Activities | Business Activities— Lincoln Educational Services Corporation and its subsidiaries (collectively, the “Company”, “we”, “our” and “us”, as applicable) provide diversified career-oriented post-secondary education to recent high school graduates and working adults. The Company, which currently operates 28 schools in 15 states, offers programs in automotive technology, skilled trades (which include HVAC, welding and computerized numerical control and electronic systems technology, among other programs), healthcare services (which include nursing, dental assistant, medical administrative assistant and pharmacy technician, among other programs), hospitality services (which include culinary, therapeutic massage, cosmetology and aesthetics) and business and information technology (which includes information technology and criminal justice programs). The schools operate under Lincoln Technical Institute, Lincoln College of Technology, Lincoln College of New England, Lincoln Culinary Institute, and Euphoria Institute of Beauty Arts and Sciences and associated brand names. Most of the campuses serve major metropolitan markets and each typically offers courses in multiple areas of study. Five of the campuses are destination schools, which attract students from across the United States and, in some cases, from abroad. The Company’s other campuses primarily attract students from their local communities and surrounding areas. All of the campuses are nationally or regionally accredited and are eligible to participate in federal financial aid programs by the U.S. Department of Education (the “DOE”) and applicable state education agencies and accrediting commissions which allow students to apply for and access federal student loans as well as other forms of financial aid. In the first quarter of 2015, we reorganized our operations into three reportable business segments: (a) Transportation and Skilled Trades, (b) Healthcare and Other Professions (“HOPS”), and (c) Transitional which refers to businesses that have been or are currently being taught out. In November 2015 the Board of Directors approved a plan for the Company to divest the schools included in the HOPS business segment. Divestiture of the Company’s HOPS business segment marks a strategic shift in business strategy that will enable us to focus energy and resources predominantly on the Transportation and Skilled Trades business segment. The Company continues to actively market the schools comprising the HOPS business segment and has offers which are under consideration. The results of operations of the campuses included in the HOPS business segment are reflected as discontinued operations in the consolidated financial statements. The following table lists the schools that are included in the HOPS and Transitional Segments and their status as of December 31, 2016 and 2015:
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Liquidity | Liquidity—For the last several years, the Company and the proprietary school sector have faced deteriorating earnings. Government regulations have negatively impacted earnings by making it more difficult for potential students to obtain loans, which, when coupled with the overall economic environment, have discouraged potential students from enrolling in post-secondary schools. In light of these factors, the Company has incurred significant operating losses as a result of lower student population. Despite these events, the Company believes that its likely sources of cash should be sufficient to fund operations for the next twelve months. At December 31, 2016, the Company’s sources of cash primarily included cash and cash equivalents of $47.7 million (of which $26.7 million is restricted). The Company is also continuing to take actions to improve cash flow by aligning its cost structure to its student population. In addition to the current sources of capital discussed above that provides short term liquidity, the Company plans to sell approximately $13.2 million in assets net of liabilities, which are currently classified as held for sale and are expected to be sold within one year from the date of classification in which up to $10 million will be required to pay down debt. The Company continues to actively market these schools and has offers which are under consideration. |
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Principles of Consolidation | Principles of Consolidation—The accompanying consolidated financial statements include the accounts of Lincoln Educational Services Corporation and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated. |
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Revenue Recognition | Revenue Recognition— Revenues are derived primarily from programs taught at the Company’s schools. Tuition revenues, textbook sales and one-time fees, such as nonrefundable application fees and course material fees, are recognized on a straight-line basis over the length of the applicable program as the student proceeds through the program, which is the period of time from a student’s start date through his or her graduation date, including internships or externships that take place prior to graduation, and the Company completes the performance of teaching the student which entitles the Company to the revenue. Other revenues, such as tool sales and contract training revenues are recognized as services are performed or goods are delivered. On an individual student basis, tuition earned in excess of cash received is recorded as accounts receivable, and cash received in excess of tuition earned is recorded as unearned tuition. Refunds are calculated and paid in accordance with federal, state and accrediting agency standards. The Company evaluates whether collectability of revenue is reasonably assured prior to the student attending class and reassesses collectability of tuition and fees when a student withdraws from a course. The Company calculates the amount to be returned under Title IV and its stated refund policy to determine eligible charges and, if there is a balance due from the student after this calculation, the Company expect payment from the student and the Company has a process to pursue uncollected accounts whereby, based upon the student’s financial means and ability to pay, a payment plan is established with the student to ensure that collectability is reasonable. The Company continuously monitors its historical collections to identify potential trends that may impact our determination that collectability of receivables for withdrawn students is realizable. If a student withdraws from a program prior to a specified date, any paid but unearned tuition is refunded. Refunds are calculated and paid in accordance with federal, state and accrediting agency standards. Generally, the amount to be refunded to a student is calculated based upon the period of time the student has attended classes and the amount of tuition and fees paid by the student as of his or her withdrawal date. These refunds typically reduce deferred tuition revenue and cash on our consolidated balance sheets as the Company generally does not recognize tuition revenue in its consolidated statements of income (loss) until the related refund provisions have lapsed. Based on the application of its refund policies, the Company may be entitled to incremental revenue on the day the student withdraws from one of its schools. Prior to the year-ended December 31, 2015, the Company recorded this incremental revenue, any related student receivable and any estimate of the amount it did not expect to collect as bad debt expense during the quarter a student withdrew based on its analysis of the collectability of such amounts on an aggregate student portfolio basis, for which the Company had significant historical experience. Beginning in October 2015, the Company recorded revenue for students who withdraw from one of its schools when payment is received because collectability on an individual student basis is not reasonably assured. The Company determined incremental revenue recognized for students who withdrew during the nine-months ended September 30, 2015 to be an immaterial error which was corrected during the fourth quarter of 2015. This resulted in a reduction of net revenues by $0.3 million and bad debt expense by $0.2 million, which resulted in an increase to the loss from continuing operations of $0.1 million for the year ended December 31, 2015. Additionally, this correction reduced net student receivables from continuing operations by $0.1 million. Prior year amounts, including quarterly financial results were not restated because the effects were not material. |
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Cash and Cash Equivalents | Cash and Cash Equivalents—Cash and cash equivalents include all cash balances and highly liquid short-term investments, which contain original maturities within three months of purchase. Pursuant to the Department of Education’s cash management requirements, the Company retains funds from financial aid programs under Title IV of the Higher Education Act in segregated cash management accounts. The segregated accounts do not require a restriction on use of the cash and, as such, these amounts are classified as cash and cash equivalents on the consolidated balance sheet. |
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Restricted Cash | Restricted Cash—Restricted cash consists of deposits maintained at financial institutions under a cash collateralized agreement under the Company’s credit agreement and cash collateralized for letters of credit. $20.3 million of restricted cash is included in long-term assets on the consolidated balance sheet as the restriction is greater than one year. Refer to Note 8 for more information on the Company’s term loan. |
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Accounts Receivable | Accounts Receivable—The Company reports accounts receivable at net realizable value, which is equal to the gross receivable less an estimated allowance for uncollectible accounts. Noncurrent accounts receivable represent amounts due from graduates in excess of 12 months from the balance sheet date. |
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Allowance for uncollectible accounts | Allowance for uncollectible accounts—Based upon experience and judgment, an allowance is established for uncollectible accounts with respect to tuition receivables. In establishing the allowance for uncollectible accounts, the Company considers, among other things, current and expected economic conditions, a student's status (in-school or out-of-school), whether or not a student is currently making payments, and overall collection history. Changes in trends in any of these areas may impact the allowance for uncollectible accounts. The receivables balances of withdrawn students with delinquent obligations are reserved for based on our collection history. |
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Inventories | Inventories—Inventories consist mainly of textbooks, computers, tools and supplies. Inventories are valued at the lower of cost or market on a first-in, first-out basis. |
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Property, Equipment and Facilities - Depreciation and Amortization | Property, Equipment and Facilities—Depreciation and Amortization—Property, equipment and facilities are stated at cost. Major renewals and improvements are capitalized, while repairs and maintenance are expensed when incurred. Upon the retirement, sale or other disposition of assets, costs and related accumulated depreciation are eliminated from the accounts and any gain or loss is reflected in operating (loss) income. For financial statement purposes, depreciation of property and equipment is computed using the straight-line method over the estimated useful lives of the assets, and amortization of leasehold improvements is computed over the lesser of the term of the lease or its estimated useful life. |
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Rent Expense | Rent Expense—Rent expense related to operating leases where scheduled rent increases exist, is determined by expensing the total amount of rent due over the life of the operating lease on a straight-line basis. The difference between the rent paid under the terms of the lease and the rent expensed on a straight-line basis is included in accrued rent and other long-term liabilities on the accompanying consolidated balance sheets. |
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Advertising Costs | Advertising Costs—Costs related to advertising are expensed as incurred and approximated $18.2 million, $17.9 million and $18.0 million from continuing operations for the years ended December 31, 2016, 2015 and 2014, respectively. These amounts are included in selling, general and administrative expenses in the consolidated statements of operations. |
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Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets— The Company tests its goodwill for impairment annually, or whenever events or changes in circumstances indicate an impairment may have occurred, by comparing its reporting unit’s carrying value to its implied fair value. Impairment may result from, among other things, deterioration in the performance of the acquired business, adverse market conditions, adverse changes in applicable laws or regulations, reductions in market value of the Company, including changes that restrict the activities of the acquired business, and a variety of other circumstances. If the Company determines that an impairment has occurred, it is required to record a write-down of the carrying value and charge the impairment as an operating expense in the period the determination is made. In evaluating the recoverability of the carrying value of goodwill and other indefinite-lived intangible assets, the Company must make assumptions regarding estimated future cash flows and other factors to determine the fair value of the acquired assets. Changes in strategy or market conditions could significantly impact these judgments in the future and require an adjustment to the recorded balances. At December 31, 2016, the Company conducted its annual test for goodwill impairment and determined it did not have an impairment for continuing operations. The fair value of the Company’s reporting units were determined using Level 3 inputs included in its multiple of earnings and discounted cash flow approach. Our disposal group assets held for sale are required to be measured at the lower of carrying value or fair value less cost to sell. As a result of the consideration of offers received on our disposal group assets held for sale, we concluded that an pre-tax non-cash impairment charge of $9.9 million was required for our goodwill and intangible assets relating to this group ($9.9 million was included in discontinued operations). At December 31, 2016, the Company conducted its annual test for goodwill impairment and determined it did not have an impairment. The fair value of the Company’s reporting units were determined using Level 3 inputs included in its multiple of earnings and discounted cash flow approach. At December 31, 2015, the Company conducted its annual test for goodwill impairment and determined it did not have an impairment. The fair value of the Company’s reporting units were determined using Level 3 inputs included in its multiple of earnings and discounted cash flow approach. The Company concluded that as of September 30, 2015 there was an indicator of potential impairment as a result of a decrease in market capitalization and, accordingly, the Company tested goodwill for impairment. The test indicated that one of the Company’s reporting units was impaired, which resulted in a pre-tax non-cash charge of $0.2 million ($0.2 million of which is included in the transportation and skilled trades segment) for the three months ended September 30, 2015. At December 31, 2014, the Company conducted its annual test for goodwill impairment and determined it did not have an impairment. The fair value of the Company’s reporting units were determined using Level 3 inputs included in its multiple of earnings and discounted cash flow approach. The Company concluded that as of September 30, 2014 there was an indicator of potential impairment as a result of a decrease in market capitalization and, accordingly, the Company tested goodwill for impairment. The test indicated that ten of the Company’s reporting units were impaired, which resulted in a pre-tax non-cash charge of $39.0 million for the three months ended September 30, 2014 ($0.2 million and $38.8 million of which is included in the transportation and skilled trades segment and discontinued operations, respectively). |
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Impairment of Long-Lived Assets | Impairment of Long-Lived Assets—The Company reviews the carrying value of its long-lived assets and identifiable intangibles for possible impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. The Company evaluates long-lived assets for impairment by examining estimated future cash flows using Level 3 inputs. These cash flows are evaluated by using weighted probability techniques as well as comparisons of past performance against projections. Assets may also be evaluated by identifying independent market values. If the Company determines that an asset’s carrying value is impaired, it will record a write-down of the carrying value of the asset and charge the impairment as an operating expense in the period in which the determination is made. The Company concluded that, for the three months ended December 31, 2016, there was sufficient evidence to conclude that there was an impairment of certain long-lived assets at two of the Company’s campuses for continuing operations. The long-lived assets impairment resulted in a pre-tax charge of $3.9 million for land and buildings. Our disposal group assets held for sale are required to be measured at the lower of carrying value or fair value less cost to sell. As a result of the consideration of offers received on our disposal group assets held for sale, we concluded that an impairment charge of $7.6 million was required for our long-lived assets relating to this group ($7.6 million was included in discontinued operations). The Company concluded that for the three months ended December 31, 2015, there was no long-lived asset impairment. Long-lived assets were tested at the campuses as a result of classifying assets held for sale and certain financial indicators such as the Company’s history of losses, current respective period losses, as well as future projected losses at these campuses. The Company concluded that for the three months ended December 31, 2014 and September 30, 2014, there was sufficient evidence to conclude that there was an impairment of certain long-lived assets at one and six of the Company’s campuses, respectively. Long-lived assets had been tested at these campuses as a result of certain financial indicators such as the Company’s history of losses, current respective period losses, as well as future projected losses at these campuses. The long-lived assets impairment resulted in a pre-tax charge of $1.5 million for leasehold improvements ($1.5 million included in the Transportation and Skilled Trades segment) as of December 31, 2014 and $1.9 million for leasehold improvements ($1.5 million and $0.4 million included in the transitional segment and discontinued operations, respectively) and $0.5 million ($0.5 million included in discontinued operations) for intangible assets as of September 30, 2014. |
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Concentration of Credit Risk | Concentration of Credit Risk—Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of temporary cash investments. The Company places its cash and cash equivalents with high credit quality financial institutions. The Company's cash balances with financial institutions typically exceed the Federal Deposit Insurance limit of $0.25 million. The Company's cash balances on deposit at December 31, 2016, exceeded the balance insured by the FDIC Corporation (“FDIC”) by approximately $46.3 million. The Company has not experienced any losses to date on its invested cash. The Company extends credit for tuition and fees to many of its students. The credit risk with respect to these accounts receivable is mitigated through the students' participation in federally funded financial aid programs unless students withdraw prior to the receipt of federal funds for those students. In addition, the remaining tuition receivables are primarily comprised of smaller individual amounts due from students. With respect to student receivables, the Company had no significant concentrations of credit risk as of December 31, 2016 and 2015. |
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Use of Estimates in the Preparation of Financial Statements | Use of Estimates in the Preparation of Financial Statements—The preparation of financial statements in conformity with generally accepted accounting principles in the United States (“GAAP’) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. On an ongoing basis, the Company evaluates the estimates and assumptions, including those related to revenue recognition, bad debts, impairments, fixed assets, income taxes, benefit plans and certain accruals. Actual results could differ from those estimates. |
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Stock-Based Compensation Plans | Stock-Based Compensation Plans—The Company measures the value of stock options on the grant date at fair value, using the Black-Scholes option valuation model. The Company amortizes the fair value of stock options, net of estimated forfeitures, utilizing straight-line amortization of compensation expense over the requisite service period of the grant. The Company measures the value of service and performance-based restricted stock on the fair value of a share of common stock on the date of the grant. The Company amortizes the fair value of service based restricted stock utilizing straight-line amortization of compensation expense over the requisite service period of the grant. The Company amortizes the fair value of the performance-based restricted stock based on determination of the probable outcome of the performance condition. If the performance condition is expected to be met, then the Company amortizes the fair value of the number of shares expected to vest utilizing straight-line basis over the requisite performance period of the grant. However, if the associated performance condition is not expected to be met, then the Company does not recognize the stock-based compensation expense. |
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Income Taxes | Income Taxes—The Company accounts for income taxes in accordance with Financial Accounting Standards Board (“FASB”) ASC Topic 740, “Income Taxes” (“ASC 740”). This statement requires an asset and a liability approach for measuring deferred taxes based on temporary differences between the financial statement and tax bases of assets and liabilities existing at each balance sheet date using enacted tax rates for years in which taxes are expected to be paid or recovered. In accordance with ASC 740, the Company assesses our deferred tax asset to determine whether all or any portion of the asset is more likely than not unrealizable. A valuation allowance is required to be established or maintained when, based on currently available information, it is more likely than not that all or a portion of a deferred tax asset will not be realized. In accordance with ASC 740, our assessment considers whether there has been sufficient income in recent years and whether sufficient income is expected in future years in order to utilize the deferred tax asset. In evaluating the realizability of deferred income tax assets, the Company considered, among other things, historical levels of income, expected future income, the expected timing of the reversals of existing temporary reporting differences, and the expected impact of tax planning strategies that may be implemented to prevent the potential loss of future income tax benefits. Significant judgment is required in determining the future tax consequences of events that have been recognized in our consolidated financial statements and/or tax returns. Differences between anticipated and actual outcomes of these future tax consequences could have a material impact on the Company’s consolidated financial position or results of operations. Changes in, among other things, income tax legislation, statutory income tax rates, or future income levels could materially impact the Company’s valuation of income tax assets and liabilities and could cause our income tax provision to vary significantly among financial reporting periods. The Company recognizes accrued interest and penalties related to unrecognized tax benefits in income tax expense. During the years ended December 31, 2016 and 2015, the interest and penalties expense associated with uncertain tax positions are not significant to the Company’s results of operations or financial position. |
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Start-up Costs | Start-up Costs—Costs related to the start of new campuses are expensed as incurred. |
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Reclassification | Reclassification—During the year ended December 31, 2016, the Board of Directors approved a plan for the Company to teach-out the West Palm Beach, Florida, Center City Philadelphia, Pennsylvania, and Northeast Philadelphia, Pennsylvania, campuses which are included in the Transitional segment. In addition, during the year ended December 31, 2016, the Henderson (Green Valley), Nevada and Hartford, Connecticut campuses closed and are included in discontinued operations. In 2016, the Company reclassified related held for sale amounts reflected in the 2015 Consolidated Balance Sheet and discontinued operations in Consolidated Statements of Operations. |
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New Accounting Pronouncements | New Accounting Pronouncements In January 2017, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2017-04, "Simplifying the Test for Goodwill Impairment" ("ASU 2017-04"). ASU 2017-04 provides amendments to ASC No. 350, "Intangibles - Goodwill and Other" ("ASC 350"), which eliminate Step 2 from the goodwill impairment test. Entities should perform their goodwill impairment tests by comparing the fair value of a reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value. The amendments in this update are effective prospectively during interim and annual periods beginning after December 15, 2019, with early adoption permitted. The Company is currently assessing the impact of this update on the Company’s Consolidated Financial Statements. The FASB has recently issued several amendments to the new standard on revenue recognition, ASU No. 2014-09, Revenue from Contracts with Customers. The amendments include ASU No. 2016-08, Revenue from Contracts with Customers (Topic 606)—Principal versus Agent Considerations, which was issued in March 2016, and clarifies the implementation guidance for principal versus agent considerations in ASU 2014-09, and ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606)—Identifying Performance Obligations and Licensing, which was issued in April 2016, and amends the guidance in ASU No. 2014-09 related to identifying performance obligations. The new standard permits adoption either by using (i) a full retrospective approach for all periods presented in the period of adoption or (ii) a modified retrospective approach with the cumulative effect of initially applying the new standard recognized at the date of initial application and providing certain additional disclosures. The new standard is effective for annual reporting periods beginning after December 15, 2017, with early adoption permitted for annual reporting periods beginning after December 15, 2016. We do not plan to early adopt, and accordingly, we will adopt the new standard effective January 1, 2018. We currently plan to adopt using the modified retrospective approach. However, a final decision regarding the adoption method has not been finalized at this time. Our final determination will depend on a number of factors, such as the significance of the impact of the new standard on our financial results, system readiness, including that of software procured from third-party providers, and our ability to accumulate and analyze the information necessary to assess the impact on prior period financial statements, as necessary. We are in the initial stages of our evaluation of the impact of the new standard on our accounting policies, processes, and system requirements. We have assigned internal resources to assist in the evaluation. Furthermore, we have made and will continue to make investments in systems to enable timely and accurate reporting under the new standard. While we continue to assess all potential impacts under the new standard, there is the potential for significant impacts to the timing of recognition of revenue. While we continue to assess the potential impacts of the new standard and this standard could have a material impact on our consolidated financial statements, we do not know or cannot reasonably estimate quantitative information related to the impact of the new standard on our financial statements at this time. In November 2016, the FASB issued ASU No. 2016-18: “Statement of Cash Flows (Topic 230): Restricted Cash.” This guidance was issued to address the diversity that exists in the classification and presentation of changes in restricted cash on the statement of cash flows. The amendments will require that the statement of cash flows explain the change during the period in total cash, cash equivalents and restricted cash. The amendments are effective for financial statements issued for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The amendments will be applied using a retrospective transition method to each period presented. The Company anticipates that the adoption will not have a significant impact on the Company’s Consolidated Financial Statements. In August 2016, FASB issued ASU No. 2016-15: “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments” to address eight specific cash flow issues with the objective of reducing the existing diversity in practice. The amendments are effective for financial statements issued for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company anticipates that the adoption will not have a significant impact on the Company’s Consolidated Financial Statements. In February 2016, the FASB issued guidance requiring lessees to recognize a right-of-use asset and a lease liability on the balance sheet for substantially all leases, with the exception of short-term leases. Leases will be classified as either financing or operating, with classification affecting the pattern of expense recognition in the statement of income. The guidance is effective for annual periods, including interim periods within those periods, beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the impact that the update will have on our results of operations, financial condition and financial statement disclosures. In November 2015, the FASB issued guidance which simplifies the balance sheet classification of deferred taxes requiring that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as noncurrent on the balance sheet. This guidance is effective for public business entities for annual periods, and for interim periods within those periods, beginning after December 15, 2016 with early adoption permitted. The Company early adopted as of December 31, 2015. While the guidance does have an impact on our balance sheet classification, it does not have a material impact on our results of operations, financial condition or the financial statement disclosures. In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern that requires management to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures in certain circumstances. According to the standard, substantial doubt about an entity’s ability to continue as a going concern exists if it is probable that the entity will be unable to meet its obligations as they become due within one year after the date the entity’s financial statements are issued. In order to determine the specific disclosures, if any, that would be required, management will need to assess if substantial doubt exists, and, if so, whether its plans will alleviate such substantial doubt. The standard requires assessment each annual and interim period and became effective for the Company on December 31, 2016. |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) |
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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Status of schools included in the HOPS and Transitional Segments | The following table lists the schools that are included in the HOPS and Transitional Segments and their status as of December 31, 2016 and 2015:
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WEIGHTED AVERAGE COMMON SHARES (Tables) |
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WEIGHTED AVERAGE COMMON SHARES [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Weighted average number of common shares used to compute basic and diluted income per share | The weighted average number of common shares used to compute basic and diluted income per share for the years ended December 31, 2016, 2015 and 2014, respectively were as follows:
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DISCONTINUED OPERATIONS (Tables) |
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Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Results of operations at campuses | The results of operations at these campuses for the three year periods ended December 31, 2016 were as follows (in thousands):
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Five Training Sites [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Results of operations at campuses | The results of operations at these five training sites for the two year periods ended December 31, 2014 were as follows (in thousands):
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GOODWILL AND OTHER INTANGIBLES (Tables) |
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GOODWILL AND OTHER INTANGIBLES [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes in carrying amount of goodwill | Changes in the carrying amount of goodwill during the years ended December 31, 2016 and 2015 are as follows:
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Summary of finite-lived and indefinite-lived intangible assets | Intangible assets, which are included in other assets in the accompanying consolidated balance sheets, consisted of the following:
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Summary of estimated future amortization expense | The following table summarizes the estimated future amortization expense:
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PROPERTY, EQUIPMENT AND FACILITIES (Tables) |
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PROPERTY, EQUIPMENT AND FACILITIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, equipment and facilities | Property, equipment and facilities consist of the following:
(a) Amounts are reduced by a $1.4 million impairment charge in 2016 related to a property in Suffield, Connecticut. |
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Schedule of assets and liabilities held for sale | The assets and liabilities held for sale consist of the following:
(b) Amount is reduced by a $2.5 million impairment charge in 2016 related to a property in West Palm Beach, Florida. (c) Amount is reduced by a $7.6 million impairment charge in 2016 related to long-lived assets. (d) Amount is reduced by an $8.8 million impairment charge in 2016 related to goodwill. (e) Amount is reduced by a $1.1 million impairment charge in 2016 related to indefinite-lived assets. |
ACCRUED EXPENSES (Tables) |
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Accrued expenses | Accrued expenses consist of the following:
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LONG-TERM DEBT AND LEASE OBLIGATIONS (Tables) |
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LONG-TERM DEBT AND LEASE OBLIGATIONS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-term debt and lease obligations | Long-term debt and lease obligations consist of the following:
(a) On July 31, 2015, the Company entered into a credit agreement with three lenders, Alostar Bank of Commerce (“Alostar”), HPF Holdco, LLC and Rushing Creek 4, LLC, led by HPF Service, LLC, as administrative agent and collateral agent (the “Agent”), for an aggregate principal amount of $45 million (the “Term Loan”). The July 31, 2015 credit agreement, along with subsequent amendments to the Credit Agreement dated December 31, 2015 and February 29, 2016, are collectively referred to as the “Credit Agreement.” As of December 31, 2015 and prior to the effectiveness of a second amendment to the Credit Agreement on February 29, 2016 (the “Second Amendment”), the Term Loan consisted of a $30 million term loan (the “Term Loan A”) from HPF Holdco, LLC, Rushing Creek 4, LLC and Tiger Capital Group, LLC, secured by a first priority lien in favor of the Agent on substantially all of the real and personal property owned by the Company, and a $15 million term loan (the “Term Loan B”) from Alostar secured by a $15.3 million cash collateral account. Pursuant to the Second Amendment, the Company received an additional $5 million term loan from Alostar with which the Company repaid $5 million of the principal amount of the Term Loan A. Accordingly, upon the effectiveness of the Second Amendment, the aggregate term loans outstanding under the Credit Agreement remains at approximately $45 million, consisting of an approximate $25 million Term Loan A and a $20 million Term Loan B. In addition, pursuant to the Second Amendment, the amount of cash collateral securing the Term Loan B was increased to $20.3 million. At the Company’s request, a percentage of the cash collateral may be released to the Company at the Agent’s sole discretion and with the consent of Alostar upon the satisfaction of certain criteria as outlined in the Credit Agreement. The Term Loan, which matures on July 31, 2019, replaces a previously existing $20 million revolving credit facility with Bank of America, N.A. and other lenders, which was due to expire on April 5, 2016. The previously existing revolving credit facility was terminated concurrently with the effective date of the Credit Agreement on July 31, 2015 (the “Closing Date”). A portion of the proceeds of the Term Loan were used by the Company to (i) repay approximately $6.3 million in outstanding principal, accrued interest and fees due under the previously existing revolving credit facility, (ii) fund the $20.3 million cash collateral account securing the portion of the Term Loan provided by Alostar, (iii) fund approximately $7.4 million in a cash collateral account securing the letters of credit issued under the previously existing revolving credit facility that remain outstanding after the termination of that facility and (iv) pay transaction expenses in connection with the Term Loan and the termination of the previously existing revolving credit facility. The remaining proceeds of the Term Loan of approximately $11 million may be used by the Company to finance capital expenditures and for general corporate purposes consistent with the terms of the Credit Agreement. Interest will accrue on the Term Loan at a per annum rate equal to the greater of (i) 11% or (ii) 90-day LIBOR plus 9% determined monthly by the Agent and will be payable monthly in arrears. The principal balance of the Term Loan will be repaid in equal monthly installments, commencing on August 1, 2017, determined as the quotient of (i) 10% of the outstanding principal balance of the Term Loan as of July 2, 2017 divided by (ii) 12. A final installment of principal and all accrued and unpaid interest will be due on the maturity date of the Term Loan. The Term Loan may be prepaid in whole or in part at any time, subject to the payment of a prepayment premium equal to (i) 5% of the principal amount prepaid at any time up to but not including the second anniversary of the Closing Date and (ii) 3% of the principal amount prepaid at any time commencing on the second anniversary of the Closing Date up to but not including the third anniversary of the Closing Date. In the event of any sale or other disposition of a school or real property by the Company permitted under the Term Loan, the net proceeds of such sale or disposition must be used to prepay the Loan in an amount determined pursuant to the Credit Agreement, subject to the applicable prepayment premium; provided, however, that no prepayment premium will be due with respect to up to $15 million of aggregate repayments of the Term Loan made during the first year that the Term Loan is outstanding. A portion of the net cash proceeds of any disposition of a school in an amount determined pursuant to the terms of the Term Loan, must be deposited and held as cash collateral in a deposit account controlled by the Agent until the conditions for release set forth in the Term Loan are satisfied. In connection with the assets which are currently classified as held for sale and are expected to be sold within one year, the Company is required to classify $10 million as short term debt due to the Term Loan prepayment minimum required with respect to any such disposition. The Term Loan contains customary representations, warranties and covenants such as minimum financial responsibility composite score, cohort default rate, and other financial covenants, including minimum liquidity, maximum capital expenditures, maximum 90/10 ratio and minimum EBITDA (as defined in the Term Loan), as well as affirmative and negative covenants and events of default customary for facilities of this type. The Company was in compliance with all covenants as of December 31, 2016. Subsequent to the 2015 fiscal year end, pursuant to the Second Amendment, the financial covenants were adjusted and, at the Company’s election, will be adjusted for fiscal year 2017 and for each subsequent fiscal year until the maturity of the Term Loan at either the levels applicable to fiscal year 2016 (and each fiscal quarter thereof) contained in the Credit Agreement as of the Closing Date or the levels applicable to fiscal year 2016 (and each fiscal quarter thereof) contained in the Second Amendment. The Company elected to re-set the financial covenants at the 2016 covenant levels contained in the Second Amendment and as required paid $4 million before January 15, 2017, without prepayment penalty. In addition, in February 2017 the Company elected to repay $5 million of restricted cash without prepayment penalty. The Credit Agreement contains events of default, the occurrence and continuation of which provide the Company’s lenders with the right to exercise remedies against the Company and the collateral securing the Term Loan, including the Company’s cash. These events of default include, among other things, the Company’s failure to pay any amounts due under the Term Loan, a breach of covenants under the Credit Agreement, the Company’s insolvency and the insolvency of its subsidiaries, the occurrence of a material adverse effect, the occurrence of any default under certain other indebtedness, and a final judgment against the Company in an amount greater than $1 million. Also, in connection with the Term Loan, the Company paid to the Agent a commitment fee of $1 million on the Closing Date and is required to pay to the Agent other customary fees for facilities of this type. Total fees for the Term Loan were $2.8 million during fiscal year 2015. During the first quarter of 2016, in connection with the effectiveness of the Second Amendment, the Company paid loan modification fees of $0.5 million. These deferred finance fees are netted against the Term Loan on the Consolidated Balance Sheets and amortized to interest expense on the Consolidated Statement of Operations. As of December 31, 2016 and December 31, 2015, the Company had $44.3 million and $44.7 million outstanding under the Term Loan; offset by $2.3 million and $2.5 million of deferred finance fees, respectively. (b) The Company completed a sale and a leaseback of four facilities on December 28, 2001. The Company retained a continuing involvement in the lease and, as a result, the Company was prohibited from utilizing sale-leaseback accounting. Accordingly, the Company had treated this transaction as a finance lease. In January 2016, the lease was amended to cure certain provisions related to continuing involvement and, as a consequence, achieved sales treatment. In the first quarter of 2016, the lease was converted to an operating lease and rent payments are included in educational, services and facilities expense in the Consolidated Statement of Operations. In addition, the finance obligation, net of land and buildings, was amortized on the straight-line basis through December 31, 2016. (c) In 2009, the Company assumed a real estate capital lease for a property located in Fern Park, Florida having a term continuing through October 31, 2032. In February 2015, the Company’s Board of Directors approved a plan to cease operations of its school located at the Fern Park, Florida property, which school closed in the first quarter of 2016. In connection with the closure of the school the Company paid a $2.8 million lease termination fee to the landlord in connection with the amendment and early termination of the 2009 lease agreement. The amended lease agreement subsequently expired on April 10, 2016. In December 2015, the Company’s Board of Directors approved a plan to cease operations at the Hartford, Connecticut school which closed in the fourth quarter of 2016. In connection therewith, the Company paid a $5 million lease termination fee to its landlord in connection with the early termination of a lease agreement under which the Company leased property in Hartford, Connecticut for a term continuing through July 31, 2031. (d) On April 12, 2016, the Company entered into a credit agreement (the “L/C Agreement”) with Sterling National Bank (“Sterling”) under which Sterling has agreed to issue letters of credit from time to time at 100% margin against available funds in a cash collateral account maintained by the Company at Sterling. The maximum availability under the L/C Agreement is $9.5 million. The Company will pay Sterling a letter of credit fee equal to 1.75% on the daily amount available to be drawn under each outstanding letter of credit, which fee is payable in quarterly installments in arrears. The L/C Agreement matures on April 1, 2017 and replaces a letter of credit facility with a prior lender. The L/C Agreement contains representations, warranties, affirmative and negative covenants and events of default customary for facilities of this type. As of December 31, 2016 there were letters of credit in the aggregate principal amount of $6.1 million outstanding under the L/C Agreement. |
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Scheduled maturities of long-term debt and lease obligation | Scheduled maturities of long-term debt and lease obligations at December 31, 2016 are as follows:
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STOCKHOLDERS' EQUITY (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STOCKHOLDERS' EQUITY [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of transactions pertaining to restricted stock | The following is a summary of transactions pertaining to restricted stock:
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Summary of transactions pertaining to option plans | The following is a summary of transactions pertaining to the option plans:
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Summary of options outstanding | The following table presents a summary of options outstanding at December 31, 2016:
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PENSION PLAN (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PENSION PLAN [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of plan's funded status | The following table sets forth the plan's funded status and amounts recognized in the consolidated financial statements:
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Amounts recognized in consolidated balance sheets | Amounts recognized in the consolidated balance sheets consist of:
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Amounts recognized in accumulated other comprehensive loss | Amounts recognized in accumulated other comprehensive loss consist of:
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Components of net periodic cost for plan | The following table provides the components of net periodic cost for the plan:
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Plan assets using fair value hierarchy | The following tables present plan assets using the fair value hierarchy as of December 31, 2016 and 2015. The fair value hierarchy has three levels based on the reliability of inputs used to determine fair value. Level 1 refers to fair values determined based on quoted prices in active markets for identical assets. Level 2 refers to fair values estimated using observable prices that are based on inputs not quoted in active markets but observable by market data, while Level 3 includes the fair values estimated using significant non-observable inputs. The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
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Fair value of total plan assets by major asset category | Fair value of total plan assets by major asset category as of December 31:
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Expected benefit payments for plan | Information about the expected benefit payments for the plan is as follows:
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Benefit Obligations [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Weighted-average assumptions used | Weighted-average assumptions used to determine benefit obligations as of December 31:
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Periodic Pension Cost [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Weighted-average assumptions used | Weighted-average assumptions used to determine net periodic pension cost for years ended December 31:
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INCOME TAXES (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME TAXES [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of provision for income taxes from continuing operations | Components of the provision for income taxes from continuing operations were as follows:
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Components of deferred tax assets | The components of the deferred tax assets are as follows:
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Difference between actual tax provision and tax provision that would result from use of Federal statutory rate | The difference between the actual tax provision and the tax provision that would result from the use of the Federal statutory rate is as follows:
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Activity related to uncertain tax positions | The following table summarizes the activity related to the Company’s uncertain tax positions:
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FAIR VALUE (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair value, by balance sheet grouping | The carrying amount and estimated fair value of the Company’s financial instrument assets and liabilities, which are not measured at fair value on the Consolidated Balance Sheets, are listed in the table below:
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SEGMENT REPORTING (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENT REPORTING [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary financial information by reporting segment | Summary financial information by reporting segment is as follows:
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COMMITMENTS AND CONTINGENCIES (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
COMMITMENTS AND CONTINGENCIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lease commitments | The Company leases office premises, educational facilities and various equipment for varying periods through the year 2030 at basic annual rentals (excluding taxes, insurance, and other expenses under certain leases) as follows:
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UNAUDITED QUARTERLY FINANCIAL INFORMATION (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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UNAUDITED QUARTERLY FINANCIAL INFORMATION [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Quarterly financial information | The following tables have been updated to reflect changes in discontinued operations. Quarterly financial information for 2016 and 2015 is as follows:
|
FINANCIAL AID AND REGULATORY COMPLIANCE (Details) - Unit |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Public Utilities, General Disclosures [Line Items] | |||
Percentage of net revenues on cash basis indirectly derived from funds | 79.00% | 80.00% | 80.00% |
Maximum specified percentage of net revenues on cash basis indirectly derived from funds | 90.00% | 90.00% | 90.00% |
Period over which entity became ineligible after receiving specified percentage as revenue from funds | 2 years | ||
Period for which entity may not reapply for eligibility | 2 years | ||
Composite score for financial responsibility | 1.5 | 1.9 | 1.3 |
Minimum Composite required for financial responsibility | 1.5 | ||
Maximum Period for institution to participate under the Zone Alternative | 3 years | ||
Maximum [Member] | |||
Public Utilities, General Disclosures [Line Items] | |||
Standard composite score for financial responsibility | 3 | ||
Minimum [Member] | |||
Public Utilities, General Disclosures [Line Items] | |||
Standard composite score for financial responsibility | -1 | ||
U.S. Department of Education [Member] | |||
Public Utilities, General Disclosures [Line Items] | |||
Maximum notification period | 10 days | ||
Minimum percentage Letter of credit amount equal Total Title IV Program funds | 50.00% | ||
Minimum percentage Letter of credit amount equal Prior Years Total Title IV Program funds | 10.00% | ||
U.S. Department of Education [Member] | Maximum [Member] | |||
Public Utilities, General Disclosures [Line Items] | |||
Composite score for financial responsibility | 1.4 | ||
Minimum Composite required for financial responsibility | 1.5 | ||
U.S. Department of Education [Member] | Minimum [Member] | |||
Public Utilities, General Disclosures [Line Items] | |||
Composite score for financial responsibility | 1.0 | ||
Minimum Composite required for financial responsibility | 1.0 |
WEIGHTED AVERAGE COMMON SHARES (Details) - shares |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2015 |
Sep. 30, 2015 |
Jun. 30, 2015 |
Mar. 31, 2015 |
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Shares used to compute basic and diluted loss income per share [Abstract] | |||||||||||
Basic shares outstanding (in shares) | 23,514,000 | 23,499,000 | 23,448,000 | 23,351,000 | 23,247,000 | 23,230,000 | 23,132,000 | 23,056,000 | 23,453,427 | 23,166,977 | 22,814,105 |
Dilutive effect of stock options (in shares) | 0 | 60,161 | 0 | ||||||||
Diluted shares outstanding (in shares) | 24,602,000 | 24,680,000 | 23,448,000 | 23,351,000 | 23,347,000 | 23,270,000 | 23,132,000 | 23,056,000 | 23,453,427 | 23,227,138 | 22,814,105 |
Stock Option 2 [Member] | |||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||||||
Antidilutive shares excluded from computation of income (loss) per share (in shares) | 773,078 | 119,722 | |||||||||
Stock Option 1 [Member] | |||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||||||
Antidilutive shares excluded from computation of income (loss) per share (in shares) | 218,167 | 391,935 | 795,985 | ||||||||
Performance Shares [Member] | |||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||||||
Antidilutive shares excluded from computation of income (loss) per share (in shares) | 73,827 | 152,837 | 360,402 |
DISCONTINUED OPERATIONS (Details) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2016
USD ($)
Campus
|
Sep. 30, 2016
USD ($)
|
Jun. 30, 2016
USD ($)
|
Mar. 31, 2016
USD ($)
|
Dec. 31, 2015
USD ($)
Campus
|
Sep. 30, 2015
USD ($)
|
Jun. 30, 2015
USD ($)
|
Mar. 31, 2015
USD ($)
|
Dec. 31, 2016
USD ($)
Campus
|
Dec. 31, 2015
USD ($)
Campus
|
Dec. 31, 2014
USD ($)
Site
|
|
Result of discontinued operations [Abstract] | |||||||||||
Net loss from discontinued operations | $ (18,711) | $ (2,168) | $ (1,496) | $ (1,430) | $ 4,679 | $ (2,636) | $ (3,436) | $ (2,097) | $ (23,806) | $ (3,491) | $ (30,584) |
Impairments of goodwill and long-lived assets | $ 3,902 | $ 216 | $ 21,885 | ||||||||
Healthcare and Other Professions Business Segment [Member] | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Number of campuses | Campus | 15 | 15 | 15 | 15 | |||||||
Florida [Member] | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Number of training sites approved by board of directors to cease operations | Site | 5 | ||||||||||
Fifteen Campuses [Member] | |||||||||||
Result of discontinued operations [Abstract] | |||||||||||
Revenue | $ 88,649 | $ 97,846 | $ 106,982 | ||||||||
Loss before income tax | (6,341) | (3,491) | (26,684) | ||||||||
Income tax benefit | 0 | 0 | (2,746) | ||||||||
Net loss from discontinued operations | (6,341) | $ (3,491) | (23,938) | ||||||||
Impairments of goodwill and long-lived assets | $ 17,500 | 19,000 | |||||||||
Five Training Sites [Member] | |||||||||||
Result of discontinued operations [Abstract] | |||||||||||
Impairments of goodwill and long-lived assets | 2,100 | ||||||||||
Five Training Sites [Member] | Florida [Member] | |||||||||||
Result of discontinued operations [Abstract] | |||||||||||
Revenue | 2,140 | ||||||||||
Loss before income tax | (6,731) | ||||||||||
Income tax benefit | (85) | ||||||||||
Net loss from discontinued operations | $ (6,646) |
GOODWILL AND OTHER INTANGIBLES (Details) - USD ($) $ in Thousands |
12 Months Ended | |||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
Sep. 30, 2014 |
||||||||||
GOODWILL AND OTHER INTANGIBLES [Abstract] | ||||||||||||||||
Goodwill held for sale | $ 0 | [1] | $ 8,759 | [1] | $ 1,300 | $ 38,800 | ||||||||||
Changes in Carrying Amount of Goodwill [Abstract] | ||||||||||||||||
Gross Goodwill Balance | 108,417 | 108,417 | 115,872 | |||||||||||||
Accumulated Impairment Losses | (93,881) | (93,881) | (93,665) | |||||||||||||
Net Goodwill Balance | 14,536 | 14,536 | 22,207 | |||||||||||||
Asset held for sale | [2] | $ (7,455) | ||||||||||||||
Goodwill impairment | (216) | |||||||||||||||
Adjustments | $ 0 | |||||||||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||||||||||
Additions | 0 | |||||||||||||||
Assets held for sale | [3] | (1,454) | ||||||||||||||
Amortization | 100 | 100 | $ 200 | |||||||||||||
Assets held for sale | [3] | (378) | ||||||||||||||
Net carrying amount at end of the period | 32 | |||||||||||||||
Intangible Assets (Excluding Goodwill) [Abstract] | ||||||||||||||||
Gross carrying amount, Total | 470 | 1,924 | ||||||||||||||
Gross carrying amount, Total | 470 | 470 | 1,924 | |||||||||||||
Accumulated amortization, Total | 420 | 733 | ||||||||||||||
Amortization | 18 | 65 | ||||||||||||||
Accumulated amortization, Total | 438 | 420 | 733 | |||||||||||||
Net carrying amount | 32 | 50 | ||||||||||||||
Amortization of intangible assets | 100 | 100 | 200 | |||||||||||||
Estimated future amortization expense [Abstract] | ||||||||||||||||
2017 | 16 | |||||||||||||||
2018 | 16 | |||||||||||||||
Total | 32 | 32 | ||||||||||||||
Accreditation [Member] | ||||||||||||||||
Indefinite-lived Intangible Assets [Line Items] | ||||||||||||||||
Gross carrying amount, beginning balance | 0 | 1,064 | ||||||||||||||
Additions | 0 | |||||||||||||||
Assets held for sale | [3] | (1,064) | ||||||||||||||
Gross carrying amount, ending balance | 0 | 0 | 1,064 | |||||||||||||
Accumulated amortization, beginning balance | 0 | 0 | ||||||||||||||
Amortization | 0 | 0 | ||||||||||||||
Assets held for sale | [3] | 0 | ||||||||||||||
Accumulated amortization, ending balance | 0 | 0 | 0 | |||||||||||||
Net carrying amount at end of the period | 0 | 0 | 1,064 | 0 | 0 | $ 1,064 | ||||||||||
Trade Name [Member] | ||||||||||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||||||||||
Gross carrying amount, beginning balance | 310 | 310 | ||||||||||||||
Additions | 0 | |||||||||||||||
Assets held for sale | [3] | 0 | ||||||||||||||
Gross carrying amount, ending balance | 310 | 310 | 310 | |||||||||||||
Accumulated amortization, beginning balance | 308 | 264 | ||||||||||||||
Amortization | 2 | 44 | ||||||||||||||
Assets held for sale | [3] | 0 | ||||||||||||||
Accumulated amortization, ending balance | 310 | 308 | 264 | |||||||||||||
Net carrying amount at end of the period | $ 0 | $ 2 | ||||||||||||||
Weighted average amortization period | 7 years | 7 years | ||||||||||||||
Intangible Assets (Excluding Goodwill) [Abstract] | ||||||||||||||||
Amortization of intangible assets | $ 2 | $ 44 | ||||||||||||||
Estimated future amortization expense [Abstract] | ||||||||||||||||
Total | 0 | 2 | 0 | 2 | ||||||||||||
Curriculum [Member] | ||||||||||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||||||||||
Gross carrying amount, beginning balance | 160 | 550 | ||||||||||||||
Additions | 0 | |||||||||||||||
Assets held for sale | [3] | (390) | ||||||||||||||
Gross carrying amount, ending balance | 160 | 160 | 550 | |||||||||||||
Accumulated amortization, beginning balance | 112 | 469 | ||||||||||||||
Amortization | 16 | 21 | ||||||||||||||
Assets held for sale | [3] | (378) | ||||||||||||||
Accumulated amortization, ending balance | 128 | 112 | $ 469 | |||||||||||||
Net carrying amount at end of the period | $ 32 | $ 48 | ||||||||||||||
Weighted average amortization period | 10 years | 10 years | ||||||||||||||
Intangible Assets (Excluding Goodwill) [Abstract] | ||||||||||||||||
Amortization of intangible assets | $ 16 | $ 21 | ||||||||||||||
Estimated future amortization expense [Abstract] | ||||||||||||||||
Total | $ 32 | $ 48 | $ 32 | $ 48 | ||||||||||||
|
PROPERTY, EQUIPMENT AND FACILITIES (Details) - USD ($) $ in Thousands |
12 Months Ended | ||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
Sep. 30, 2014 |
||||||||||||||
Property, equipment and facilities net [Abstract] | |||||||||||||||||
Property, equipment and facilities, Gross | $ 179,637 | $ 189,949 | |||||||||||||||
Less accumulated depreciation and amortization | (124,192) | (123,324) | |||||||||||||||
Property, equipment and facilities, Net | 55,445 | 66,625 | |||||||||||||||
Depreciation and amortization expense | 10,900 | 10,200 | $ 14,500 | ||||||||||||||
Assets held for sale [Abstract] | |||||||||||||||||
Inventories | 629 | 646 | |||||||||||||||
Accounts receivable, less allowance of $3,930 and $3,261 at December 31, 2016 and 2015, respectively | 5,089 | 4,526 | |||||||||||||||
Prepaid expense and other current assets | 460 | 724 | |||||||||||||||
Noncurrent receivables, less allowance of $212 and $189 at December 31, 2016 and 2015, respectively | 1,690 | 1,384 | |||||||||||||||
Property, equipment and facilities - at cost, net of accumluated depreciation and amortization of $41,703 and $34,751 at December 31, 2016 and 2015, respectively | [1],[2] | 16,847 | 27,133 | ||||||||||||||
Goodwill | 0 | [3] | 8,759 | [3] | $ 1,300 | $ 38,800 | |||||||||||
Other assets, net | [4] | 71 | 1,197 | ||||||||||||||
Assets held for sale | 24,786 | 44,369 | |||||||||||||||
Liabilities held for sale [Abstract] | |||||||||||||||||
Unearned tuition | (7,255) | (7,929) | |||||||||||||||
Accrued expenses | (2,553) | (2,668) | |||||||||||||||
Accrued rent | (1,770) | (1,735) | |||||||||||||||
Liabilities held for sale | (11,578) | (12,332) | |||||||||||||||
Assets held for sale, net | 13,208 | 32,037 | |||||||||||||||
Long lived assets held for sale, other information [Abstract] | |||||||||||||||||
Accounts receivable, allowance | 3,930 | 3,261 | |||||||||||||||
Noncurrent receivables, allowance | 212 | 189 | |||||||||||||||
Property, equipment and facilities - accumulated depreciation and amortization | 41,703 | 34,751 | |||||||||||||||
Long-lived Assets [Member] | |||||||||||||||||
Long lived assets held for sale, other information [Abstract] | |||||||||||||||||
Reduction in impairment charge | 7,600 | ||||||||||||||||
Goodwill [Member] | |||||||||||||||||
Long lived assets held for sale, other information [Abstract] | |||||||||||||||||
Reduction in impairment charge | 8,800 | ||||||||||||||||
Indefinite-lived Intangible Assets [Member] | |||||||||||||||||
Long lived assets held for sale, other information [Abstract] | |||||||||||||||||
Reduction in impairment charge | 1,100 | ||||||||||||||||
Land [Member] | |||||||||||||||||
Property, equipment and facilities net [Abstract] | |||||||||||||||||
Property, equipment and facilities, Gross | [5] | 6,969 | 10,054 | ||||||||||||||
Buildings and Improvements [Member] | |||||||||||||||||
Property, equipment and facilities net [Abstract] | |||||||||||||||||
Property, equipment and facilities, Gross | [5] | $ 105,433 | 112,281 | ||||||||||||||
Buildings and Improvements [Member] | Minimum [Member] | |||||||||||||||||
Property, equipment and facilities net [Abstract] | |||||||||||||||||
Useful life | [5] | 1 year | |||||||||||||||
Buildings and Improvements [Member] | Maximum [Member] | |||||||||||||||||
Property, equipment and facilities net [Abstract] | |||||||||||||||||
Useful life | [5] | 25 years | |||||||||||||||
Equipment, Furniture and Fixtures [Member] | |||||||||||||||||
Property, equipment and facilities net [Abstract] | |||||||||||||||||
Property, equipment and facilities, Gross | $ 65,776 | 66,838 | |||||||||||||||
Equipment, Furniture and Fixtures [Member] | Minimum [Member] | |||||||||||||||||
Property, equipment and facilities net [Abstract] | |||||||||||||||||
Useful life | 1 year | ||||||||||||||||
Equipment, Furniture and Fixtures [Member] | Maximum [Member] | |||||||||||||||||
Property, equipment and facilities net [Abstract] | |||||||||||||||||
Useful life | 7 years | ||||||||||||||||
Vehicles [Member] | |||||||||||||||||
Property, equipment and facilities net [Abstract] | |||||||||||||||||
Useful life | 3 years | ||||||||||||||||
Property, equipment and facilities, Gross | $ 534 | 617 | |||||||||||||||
Construction in Progress [Member] | |||||||||||||||||
Property, equipment and facilities net [Abstract] | |||||||||||||||||
Property, equipment and facilities, Gross | 925 | $ 159 | |||||||||||||||
West Palm Beach Property [Member] | |||||||||||||||||
Long lived assets held for sale, other information [Abstract] | |||||||||||||||||
Reduction in impairment charge | 2,500 | ||||||||||||||||
Suffield [Member] | |||||||||||||||||
Long lived assets held for sale, other information [Abstract] | |||||||||||||||||
Reduction in impairment charge | $ 1,400 | ||||||||||||||||
|
ACCRUED EXPENSES (Details) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
ACCRUED EXPENSES [Abstract] | ||
Accrued compensation and benefits | $ 6,664 | $ 6,151 |
Accrued rent and real estate taxes | 2,917 | 2,012 |
Other accrued expenses | 3,234 | 3,046 |
Accrued expenses | $ 12,815 | $ 11,209 |
LONG-TERM DEBT AND LEASE OBLIGATIONS (Details) |
1 Months Ended | 12 Months Ended | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Apr. 12, 2016
USD ($)
|
Feb. 29, 2016
USD ($)
|
Feb. 12, 2016
USD ($)
|
Jul. 31, 2015
USD ($)
|
Feb. 28, 2017
USD ($)
|
Dec. 31, 2016
USD ($)
Lender
|
Dec. 31, 2015
USD ($)
|
||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Long term debt and capital lease obligations | $ 44,267,000 | $ 58,224,000 | ||||||||||||
Less current maturities | (11,713,000) | (10,114,000) | ||||||||||||
Long-term debt and lease obligations | $ 32,554,000 | 48,110,000 | ||||||||||||
Interest rate of debt instrument | 11.00% | |||||||||||||
Percentage of outstanding principal balance of loan | 10.00% | |||||||||||||
Percentage of principal amount prepaid but not including in the second anniversary | 5.00% | |||||||||||||
Percentage of principal amount prepaid but not including in the third anniversary | 3.00% | |||||||||||||
Sale and a leaseback of facilities, Date | December 28, 2001 | |||||||||||||
Scheduled maturities of long-term debt and lease obligations [Abstract] | ||||||||||||||
2017 | $ 11,713,000 | |||||||||||||
2018 | 3,427,000 | |||||||||||||
2019 | 29,127,000 | |||||||||||||
2020 | 0 | |||||||||||||
2021 | 0 | |||||||||||||
Thereafter | 0 | |||||||||||||
Long term debt and capital lease obligations | $ 44,267,000 | |||||||||||||
Hartford [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Lease termination fee | 5,000,000 | |||||||||||||
Fern Park [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Lease termination fee | $ 2,800,000 | |||||||||||||
90-day LIBOR [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Debt instrument, basis spread on variable rate | 9.00% | |||||||||||||
Credit Agreement [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Number of lenders | Lender | 3 | |||||||||||||
Expiration date of credit facility | Apr. 01, 2017 | |||||||||||||
Percentage of letters of credit margin against available funds in cash collateral | 100.00% | |||||||||||||
Maximum availability of amount under agreement | $ 9,500,000 | |||||||||||||
Percentage of letter of credit fee, quarterly installment | 1.75% | |||||||||||||
Aggregate principal amount outstanding | $ 6,100,000 | |||||||||||||
Revolving Credit Facility [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Expiration date of credit facility | Apr. 05, 2016 | |||||||||||||
Repayment of outstanding principal, accrued interest and fees | $ 6,300,000 | |||||||||||||
Proceeds for remaining loan amount | 11,000,000 | |||||||||||||
Revolving Credit Facility [Member] | Bank of America and Other Lenders [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Long-term line of credit | 20,000,000 | |||||||||||||
Letter of Credit [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Cash collateral amount | 7,400,000 | |||||||||||||
Term Loan Agreement [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Long-term line of credit | [1] | $ 44,267,000 | 44,653,000 | |||||||||||
Outstanding term loan | $ 45,000,000 | 45,000,000 | ||||||||||||
Expiration date of credit facility | Jul. 31, 2019 | |||||||||||||
Deferred finance fees | $ 2,300 | 2,500 | ||||||||||||
Short-term debt | 10,000,000 | |||||||||||||
Term loan amount paid under second amendment | 4,000,000 | |||||||||||||
Judgment amount to cause breach of covenant | 1,000,000 | |||||||||||||
Commitment fee | 1,000,000 | |||||||||||||
Amount of fees for term loan | 500,000 | 2,800,000 | ||||||||||||
Term Loan Agreement [Member] | Subsequent Event [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Repayment of restricted cash without prepayment penalty | $ 5,000,000 | |||||||||||||
Term Loan A [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Outstanding term loan | 25,000,000 | |||||||||||||
Term Loan A [Member] | HPF Holdco, LLC, Rushing Creek 4, LLC and Tiger Capital Group, LLC [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Outstanding term loan | 30,000,000 | |||||||||||||
Term Loan A [Member] | Alostar Bank of Commerce [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Term loan principal repayment | 5,000,000 | |||||||||||||
Term Loan B [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Outstanding term loan | 20,000,000 | |||||||||||||
Cash collateral amount | $ 20,300,000 | |||||||||||||
Term Loan B [Member] | Alostar Bank of Commerce [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Outstanding term loan | 15,000,000 | |||||||||||||
Cash collateral amount | 15,300,000 | |||||||||||||
Outstanding term loan additional amount | $ 5,000,000 | |||||||||||||
Maximum [Member] | Term Loan Agreement [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Aggregate repayments of the Loan | 15,000,000 | |||||||||||||
Finance Obligation [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Capital lease and finance obligation | [2] | 0 | 9,672,000 | |||||||||||
Capital Lease-Property (with a rate of 8.0%) [Member] | ||||||||||||||
Long term debt and lease obligations [Abstract] | ||||||||||||||
Capital lease and finance obligation | [3] | $ 0 | $ 3,899,000 | |||||||||||
Interest rate of debt instrument | 8.00% | |||||||||||||
|
STOCKHOLDERS' EQUITY (Details) $ / shares in Units, $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Dec. 31, 2016
USD ($)
Plan
$ / shares
shares
|
Dec. 31, 2015
USD ($)
$ / shares
shares
|
Dec. 31, 2014
USD ($)
$ / shares
shares
|
Dec. 31, 2013
USD ($)
$ / shares
shares
|
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of stock incentive plans | Plan | 2 | |||
Vesting period of performance-based shares | 2 years | 3 years | 4 years | |
Specified operating income margin period | 1 year | 1 year | ||
Shares [Abstract] | ||||
Outstanding, beginning balance (in shares) | shares | 246,167 | 424,167 | 547,125 | |
Canceled (in shares) | shares | (28,000) | (178,000) | (122,958) | |
Outstanding, ending balance (in shares) | shares | 218,167 | 246,167 | 424,167 | 547,125 |
Vested or expected to vest (in shares) | shares | 218,167 | |||
Exercisable, ending balance (in shares) | shares | 218,167 | |||
Weighted Average Exercise Price Per Share [Abstract] | ||||
Outstanding, beginning balance (in dollars per share) | $ 12.52 | $ 13.65 | $ 14.73 | |
Cancelled (in dollars per share) | 15.76 | 15.20 | 18.49 | |
Outstanding, ending balance (in dollars per share) | 12.11 | $ 12.52 | $ 13.65 | $ 14.73 |
Vested or expected to vest (in dollars per share) | 12.11 | |||
Exercisable, ending balance (in dollars per share) | $ 12.11 | |||
Weighted Average Remaining Contractual Term [Abstract] | ||||
Outstanding, balance | 3 years 3 months 29 days | 3 years 11 months 23 days | 4 years 2 months 5 days | 4 years 6 months 22 days |
Vested or expected to vest | 3 years 3 months 29 days | |||
Exercisable, ending balance | 3 years 3 months 29 days | |||
Aggregate Intrinsic Value [Abstract] | ||||
Outstanding, beginning balance | $ | $ 0 | $ 0 | $ 0 | |
Cancelled | $ | 0 | 0 | ||
Outstanding, ending balance | $ | 0 | $ 0 | $ 0 | $ 0 |
Vested or expected to vest | $ | 0 | |||
Exercisable, ending balance | $ | $ 0 | |||
Stock Options Outstanding [Abstract] | ||||
Shares (in shares) | shares | 218,167 | |||
Contractual Weighted Average Life | 3 years 3 months 29 days | |||
Weighted Average Price (in dollars per share) | $ 12.11 | |||
Stock Options Exercisable [Abstract] | ||||
Shares (in shares) | shares | 218,167 | |||
Weighted Exercise Price (in dollars per share) | $ 12.11 | |||
Restricted Stock [Member] | ||||
Shares [Abstract] | ||||
Nonvested restricted stock outstanding, beginning balance (in shares) | shares | 450,494 | 925,819 | ||
Granted (in shares) | shares | 1,105,487 | 234,651 | ||
Cancelled (in shares) | shares | (76,200) | (354,462) | ||
Vested (in shares) | shares | (336,182) | (355,514) | ||
Nonvested restricted stock outstanding, ending balance (in shares) | shares | 1,143,599 | 450,494 | 925,819 | |
Weighted Average Grant Date Fair Value [Abstract] | ||||
Nonvested restricted stock outstanding, beginning balance (in dollars per share) | $ 3.69 | $ 5.04 | ||
Granted (in dollars per share) | 1.67 | 2.28 | ||
Cancelled (in dollars per share) | 2.98 | 4.97 | ||
Vested (in dollars per share) | 3.33 | 5.00 | ||
Nonvested restricted stock outstanding, ending balance (in dollars per share) | $ 1.89 | $ 3.69 | $ 5.04 | |
Recognized restricted stock expense | $ | $ 1,400 | $ 1,100 | $ 2,500 | |
Unrecognized restricted stock expense | $ | $ 1,500 | $ 1,300 | ||
Weighted average period | 1 year 10 months 24 days | |||
Number of shares cancelled (in shares) | shares | 26,200 | |||
Stock Options [Member] | ||||
Stock Options [Abstract] | ||||
Stock options granted (in shares) | shares | 0 | 0 | 0 | |
Aggregate Intrinsic Value [Abstract] | ||||
Unrecognized pre-tax compensation expense | $ | $ 0 | |||
LTIP [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Net share settlement for restricted stock (in shares) | shares | 71,805 | 85,740 | 144,983 | |
Net share settlement for stock options (in shares) | shares | 71,805 | 85,740 | 144,983 | |
Decrease in equity due to payment of tax for employee | $ | $ 200 | $ 200 | $ 400 | |
LTIP [Member] | Restricted Stock [Member] | ||||
Weighted Average Grant Date Fair Value [Abstract] | ||||
Outstanding restricted shares, intrinsic value | $ | $ 2,200 | |||
$ 4.00-$13.99 [Member] | ||||
Range of Exercise Prices [Abstract] | ||||
Range of Exercise Prices, Minimum (in dollars per share) | $ 4.00 | |||
Range of Exercise Prices, Maximum (in dollars per share) | $ 13.99 | |||
Stock Options Outstanding [Abstract] | ||||
Shares (in shares) | shares | 165,167 | |||
Contractual Weighted Average Life | 3 years 4 months 6 days | |||
Weighted Average Price (in dollars per share) | $ 9.46 | |||
Stock Options Exercisable [Abstract] | ||||
Shares (in shares) | shares | 165,167 | |||
Weighted Exercise Price (in dollars per share) | $ 9.46 | |||
$ 14.00-$19.99 [Member] | ||||
Range of Exercise Prices [Abstract] | ||||
Range of Exercise Prices, Minimum (in dollars per share) | 14.00 | |||
Range of Exercise Prices, Maximum (in dollars per share) | $ 19.99 | |||
Stock Options Outstanding [Abstract] | ||||
Shares (in shares) | shares | 22,000 | |||
Contractual Weighted Average Life | 2 years 10 months 2 days | |||
Weighted Average Price (in dollars per share) | $ 19.98 | |||
Stock Options Exercisable [Abstract] | ||||
Shares (in shares) | shares | 22,000 | |||
Weighted Exercise Price (in dollars per share) | $ 19.98 | |||
$ 20.00-$25.00 [Member] | ||||
Range of Exercise Prices [Abstract] | ||||
Range of Exercise Prices, Minimum (in dollars per share) | 20.00 | |||
Range of Exercise Prices, Maximum (in dollars per share) | $ 25.00 | |||
Stock Options Outstanding [Abstract] | ||||
Shares (in shares) | shares | 31,000 | |||
Contractual Weighted Average Life | 3 years 7 months 2 days | |||
Weighted Average Price (in dollars per share) | $ 20.62 | |||
Stock Options Exercisable [Abstract] | ||||
Shares (in shares) | shares | 31,000 | |||
Weighted Exercise Price (in dollars per share) | $ 20.62 |
PENSION PLAN, Plan's funded status (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
CHANGES IN BENEFIT OBLIGATIONS [Roll Forward] | |||
Benefit obligation-beginning of year | $ 23,341 | $ 24,299 | $ 20,314 |
Service cost | 28 | 28 | 23 |
Interest cost | 888 | 884 | 892 |
Actuarial (gain) loss | (255) | (782) | 4,149 |
Benefits paid | (1,086) | (1,088) | (1,079) |
Benefit obligation at end of year | 22,916 | 23,341 | 24,299 |
CHANGE IN PLAN ASSETS [Roll Forward] | |||
Fair value of plan assets-beginning of year | 17,792 | 19,000 | 18,792 |
Actual return on plan assets | 842 | (120) | 1,017 |
Employer contributions | 0 | 0 | 270 |
Benefits paid | (1,086) | (1,088) | (1,079) |
Fair value of plan assets-end of year | 17,548 | 17,792 | 19,000 |
BENEFIT OBLIGATION IN EXCESS OF FAIR VALUE FUNDED STATUS: | $ (5,368) | $ (5,549) | $ (5,299) |
PENSION PLAN (Details) - USD ($) $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
Dec. 31, 2013 |
|
Amounts recognized in the consolidated balance sheets [Abstract] | ||||
Noncurrent liabilities | $ (5,368) | $ (5,549) | $ (5,299) | |
Amounts recognized in accumulated other comprehensive loss [Abstract] | ||||
Accumulated loss | (8,467) | (9,438) | (9,833) | |
Deferred income taxes | 2,366 | 2,366 | 2,366 | |
Accumulated other comprehensive loss | (6,101) | (7,072) | (7,467) | |
Accumulated benefit obligation | 22,900 | 23,300 | ||
COMPONENTS OF NET PERIODIC BENEFIT COST [Abstract] | ||||
Service cost | 28 | 28 | 23 | |
Interest cost | 888 | 884 | 892 | |
Expected return on plan assets | (1,118) | (1,243) | (1,287) | |
Recognized net actuarial loss | 991 | 976 | 513 | |
Net periodic benefit cost | 789 | 645 | 141 | |
Amortization of estimated net loss, transition obligation and prior service cost from accumulated other comprehensive income into net periodic benefit cost | 900 | |||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | $ 17,548 | $ 17,792 | $ 19,000 | $ 18,792 |
Fair value of total plan assets by major asset category | 100.00% | 100.00% | 100.00% | |
Weighted-average assumptions used to determine benefit obligations [Abstract] | ||||
Discount rate | 3.81% | 3.94% | 3.66% | |
Rate of compensation increase | 2.50% | 2.50% | 1.13% | |
Weighted-average assumptions used to determine net periodic pension cost [Abstract] | ||||
Pension contributions | $ 0 | $ 0 | ||
Expected benefit payments for the plan [Abstract] | ||||
Maximum contribution by employee specified as percentage of compensation | 25.00% | |||
Additional contribution by employer | 30.00% | |||
Maximum percentage of compensation contributed by employer as matching contribution | 6.00% | |||
Compensation expense for the 401(k) plan | $ 700 | 700 | $ 1,600 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | 17,548 | 17,792 | ||
Significant Other Observable Inputs (Level 2) [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | 0 | 0 | ||
Significant Unobservable Inputs (Level 3) [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | 0 | 0 | ||
Equity Securities [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | $ 8,509 | $ 8,473 | ||
Fair value of total plan assets by major asset category | 49.00% | 48.00% | 50.00% | |
Expected benefit payments for the plan [Abstract] | ||||
Target plan asset allocations, minimum | 30.00% | |||
Target plan asset allocations, maximum | 70.00% | |||
Equity Securities [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | $ 8,509 | $ 8,473 | ||
Equity Securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | 0 | 0 | ||
Equity Securities [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | 0 | 0 | ||
Fixed Income [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | $ 6,548 | $ 5,943 | ||
Fair value of total plan assets by major asset category | 37.00% | 33.00% | 32.00% | |
Expected benefit payments for the plan [Abstract] | ||||
Target plan asset allocations, minimum | 20.00% | |||
Target plan asset allocations, maximum | 60.00% | |||
Fixed Income [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | $ 6,548 | $ 5,943 | ||
Fixed Income [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | 0 | 0 | ||
Fixed Income [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | 0 | 0 | ||
International Equities [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | $ 2,484 | $ 3,288 | ||
Fair value of total plan assets by major asset category | 14.00% | 19.00% | 18.00% | |
International Equities [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | $ 2,484 | $ 3,288 | ||
International Equities [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | 0 | 0 | ||
International Equities [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | 0 | 0 | ||
Cash and Equivalents [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | $ 7 | $ 88 | ||
Fair value of total plan assets by major asset category | 0.00% | 0.00% | 0.00% | |
Expected benefit payments for the plan [Abstract] | ||||
Target plan asset allocations, minimum | 0.00% | |||
Target plan asset allocations, maximum | 10.00% | |||
Cash and Equivalents [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | $ 7 | $ 88 | ||
Cash and Equivalents [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | 0 | 0 | ||
Cash and Equivalents [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||||
Plan assets using the fair value hierarchy [Abstract] | ||||
Fair value of plan assets | $ 0 | $ 0 | ||
Pension Plan [Member] | ||||
Weighted-average assumptions used to determine net periodic pension cost [Abstract] | ||||
Discount rate | 3.81% | 3.94% | 4.46% | |
Rate of compensation increase | 2.50% | 2.50% | 1.13% | |
Long-term rate of return | 6.25% | 6.50% | 7.00% | |
Expected benefit payments for the plan [Abstract] | ||||
2017 | $ 1,257 | |||
2018 | 1,323 | |||
2019 | 1,357 | |||
2020 | 1,369 | |||
2021 | 1,376 | |||
Years 2022-2026 | $ 7,039 |
INCOME TAXES (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Current [Abstract] | |||
Federal | $ 0 | $ 0 | $ 0 |
State | 200 | 242 | 200 |
Total | 200 | 242 | 200 |
Deferred [Abstract] | |||
Federal | 0 | 0 | (1,420) |
State | 0 | 0 | (259) |
Total | 0 | 0 | (1,679) |
Total provision (benefit) | 200 | 242 | (1,479) |
Noncurrent deferred tax assets (liabilities) [Abstract] | |||
Allowance for bad debts | 5,904 | 5,617 | |
Accrued rent | 3,191 | 2,952 | |
Accrued bonus | 1,429 | 0 | |
Accrued benefits | 198 | 0 | |
Stock-based compensation | 557 | 498 | |
Depreciation | 20,372 | 14,941 | |
Goodwill | 1,959 | (380) | |
Other intangibles | 562 | 274 | |
Pension plan liabilities | 2,142 | 2,215 | |
Net operating loss carryforwards | 17,846 | 14,765 | |
Sale leaseback-deferred gain | 0 | 2,629 | |
AMT credit | 424 | 424 | |
Total noncurrent deferred tax assets | 54,584 | 43,935 | |
Less valuation allowance | (54,584) | (43,935) | |
Noncurrent deferred tax assets, net of valuation allowance | 0 | 0 | |
Difference between the actual tax provision and the tax provision that would result from the use of the Federal statutory rate [Abstract] | |||
(Loss) gain from continuing operations before taxes | (4,298) | 383 | (27,028) |
Expected tax benefit | (1,504) | 134 | (9,460) |
State tax benefit (net of federal) | 200 | 242 | (43) |
Valuation allowance | 1,394 | (274) | 7,876 |
Other | 110 | 140 | 148 |
Total provision (benefit) | $ 200 | $ 242 | $ (1,479) |
Expected tax benefit | 35.00% | 35.00% | 35.00% |
State tax benefit (net of federal) | (4.70%) | 63.20% | 0.20% |
Valuation allowance | (32.40%) | (71.50%) | (29.10%) |
Other | (2.60%) | 36.50% | (0.60%) |
Total | (4.70%) | 63.20% | 5.50% |
Net operating loss carryforwards | $ 39,700 | $ 32,600 | |
Net operating loss carryforwards, period of ownership change | 3 years | ||
Net operating loss carryforwards, minimum percentage of ownership change | 50.00% | ||
Activity related to uncertain tax positions [Roll Forward] | |||
Balance, beginning of period | $ 0 | 0 | $ 0 |
Decrease for tax positions of prior years | 0 | 0 | 0 |
Increase for tax positions of current year | 0 | 0 | 0 |
Balance, end of period | $ 0 | $ 0 | $ 0 |
FAIR VALUE (Details) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Carrying Amount [Member] | ||
Financial Assets [Abstract] | ||
Cash and cash equivalents | $ 21,064 | $ 38,420 |
Restricted cash | 6,399 | 7,362 |
Prepaid expenses and other current assets | 2,434 | 2,710 |
Noncurrent restricted cash | 20,252 | 15,259 |
Financial Liabilities [Abstract] | ||
Accrued expenses | 12,815 | 11,209 |
Other short term liabilities | 653 | 686 |
Term loan | 44,267 | 44,653 |
Fair Value [Member] | ||
Financial Assets [Abstract] | ||
Cash and cash equivalents | 21,064 | 38,420 |
Restricted cash | 6,399 | 7,362 |
Prepaid expenses and other current assets | 2,434 | 2,710 |
Noncurrent restricted cash | 20,252 | 15,259 |
Financial Liabilities [Abstract] | ||
Accrued expenses | 12,815 | 11,209 |
Other short term liabilities | 653 | 686 |
Term loan | 40,687 | 36,795 |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Fair Value [Member] | ||
Financial Assets [Abstract] | ||
Cash and cash equivalents | 21,064 | 38,420 |
Restricted cash | 6,399 | 7,362 |
Prepaid expenses and other current assets | 0 | 0 |
Noncurrent restricted cash | 20,252 | 15,259 |
Financial Liabilities [Abstract] | ||
Accrued expenses | 0 | 0 |
Other short term liabilities | 0 | 0 |
Term loan | 0 | 0 |
Significant Other Observable Inputs (Level 2) [Member] | Fair Value [Member] | ||
Financial Assets [Abstract] | ||
Cash and cash equivalents | 0 | 0 |
Restricted cash | 0 | 0 |
Prepaid expenses and other current assets | 2,434 | 2,710 |
Noncurrent restricted cash | 0 | 0 |
Financial Liabilities [Abstract] | ||
Accrued expenses | 12,815 | 11,209 |
Other short term liabilities | 653 | 686 |
Term loan | 40,687 | 36,795 |
Significant Unobservable Inputs (Level 3) [Member] | Fair Value [Member] | ||
Financial Assets [Abstract] | ||
Cash and cash equivalents | 0 | 0 |
Restricted cash | 0 | 0 |
Prepaid expenses and other current assets | 0 | 0 |
Noncurrent restricted cash | 0 | 0 |
Financial Liabilities [Abstract] | ||
Accrued expenses | 0 | 0 |
Other short term liabilities | 0 | 0 |
Term loan | $ 0 | $ 0 |
SEGMENT REPORTING (Details) $ in Thousands |
3 Months Ended | 12 Months Ended | |||
---|---|---|---|---|---|
Nov. 03, 2015
School
|
Mar. 31, 2015
Segment
|
Dec. 31, 2016
USD ($)
Segment
Location
|
Dec. 31, 2015
USD ($)
|
Dec. 31, 2014
USD ($)
|
|
SEGMENT REPORTING [Abstract] | |||||
Number of locations closed | Location | 10 | ||||
Number of reportable segments | Segment | 3 | 2 | |||
Summary financial information by reporting segment [Abstract] | |||||
Revenues | $ 196,910 | $ 208,256 | $ 218,040 | ||
Percentage of Total Revenue | 100.00% | 100.00% | 100.00% | ||
Operating (Loss) Income | $ (5,163) | $ 5,949 | $ (23,659) | ||
Assets | 163,207 | 207,750 | |||
Discontinued Operations [Member] | |||||
Summary financial information by reporting segment [Abstract] | |||||
Assets | 24,786 | 44,369 | |||
Healthcare and Other Professions Business Segment [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Number of schools approved to divest | School | 15 | ||||
Reportable Segments [Member] | Transportation and Skilled Trades [Member] | |||||
Summary financial information by reporting segment [Abstract] | |||||
Revenues | $ 177,882 | $ 183,821 | $ 188,669 | ||
Percentage of Total Revenue | 90.30% | 88.30% | 86.50% | ||
Operating (Loss) Income | $ 21,278 | $ 26,778 | $ 19,519 | ||
Assets | 83,320 | 90,045 | |||
Reportable Segments [Member] | Transitional [Member] | |||||
Summary financial information by reporting segment [Abstract] | |||||
Revenues | $ 19,028 | $ 24,435 | $ 29,371 | ||
Percentage of Total Revenue | 9.70% | 11.70% | 13.50% | ||
Operating (Loss) Income | $ (6,334) | $ (1,689) | $ (19,814) | ||
Assets | 1,594 | 4,492 | |||
Corporate [Member] | |||||
Summary financial information by reporting segment [Abstract] | |||||
Revenues | $ 0 | $ 0 | $ 0 | ||
Percentage of Total Revenue | 0.00% | 0.00% | 0.00% | ||
Operating (Loss) Income | $ (20,107) | $ (19,140) | $ (23,364) | ||
Assets | $ 53,507 | $ 68,844 |
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Jul. 13, 2015 |
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Credit Agreement [Abstract] | ||||
2017 | $ 16,048 | |||
2018 | 6,881 | |||
2019 | 30,958 | |||
2020 | 0 | |||
2021 | 0 | |||
Thereafter | 0 | |||
Credit agreement, Total | 53,887 | |||
Less amount representing interest | (9,620) | |||
Credit agreement net of interest | 44,267 | |||
Operating Leases [Abstract] | ||||
2017 | 21,428 | |||
2018 | 19,132 | |||
2019 | 16,521 | |||
2020 | 12,439 | |||
2021 | 7,202 | |||
Thereafter | 20,484 | |||
Operating Leases, Total | 97,206 | |||
Less amount representing interest | 0 | |||
Operating leases net of interest | 97,206 | |||
Lease rent expense | 12,000 | $ 10,900 | $ 11,100 | |
Settlement amount | $ 850,000 | |||
Debt forgiveness | $ 165,000 | |||
Outstanding net loan commitment | 30,000 | |||
Future employment contract commitments | 3,100 | |||
Surety bonds | $ 14,300 |
RELATED PARTY (Details) $ in Millions |
12 Months Ended |
---|---|
Dec. 31, 2016
USD ($)
| |
RELATED PARTY [Abstract] | |
Purchases from related party | $ 1.0 |
UNAUDITED QUARTERLY FINANCIAL INFORMATION (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2015 |
Sep. 30, 2015 |
Jun. 30, 2015 |
Mar. 31, 2015 |
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
UNAUDITED QUARTERLY FINANCIAL INFORMATION [Abstract] | |||||||||||
Revenue | $ 50,348 | $ 52,877 | $ 46,263 | $ 47,423 | $ 52,552 | $ 55,752 | $ 48,607 | $ 51,345 | $ 196,910 | $ 208,256 | $ 218,040 |
(Loss) income from continuing operations | 84 | 1,697 | (1,642) | (4,638) | 3,878 | 5,217 | (4,169) | (4,786) | (4,498) | 141 | (25,549) |
(Loss) income from discontinued operations | (18,711) | (2,168) | (1,496) | (1,430) | 4,679 | (2,636) | (3,436) | (2,097) | (23,806) | (3,491) | (30,584) |
Net (loss) income | $ (18,627) | $ (471) | $ (3,138) | $ (6,068) | $ 8,557 | $ 2,581 | $ (7,605) | $ (6,883) | $ (28,304) | $ (3,350) | $ (56,133) |
Basic [Abstract] | |||||||||||
(Loss) earnings per share from continuing operations (in dollars per share) | $ 0 | $ 0.07 | $ (0.07) | $ (0.20) | $ 0.17 | $ 0.22 | $ (0.18) | $ (0.21) | $ (0.19) | $ 0.01 | $ (1.12) |
(Loss) earnings per share from discontinued operations (in dollars per share) | (0.79) | (0.09) | (0.06) | (0.06) | 0.20 | (0.11) | (0.15) | (0.09) | (1.02) | (0.15) | (1.34) |
Net loss per share (in dollars per share) | (0.79) | (0.02) | (0.13) | (0.26) | 0.37 | 0.11 | (0.33) | (0.30) | (1.21) | (0.14) | (2.46) |
Diluted [Abstract] | |||||||||||
(Loss) earnings per share from continuing operations (in dollars per share) | 0 | 0.07 | (0.07) | (0.20) | 0.17 | 0.22 | (0.18) | (0.21) | (0.19) | 0.01 | (1.12) |
(Loss) earnings per share from discontinued operations (in dollars per share) | (0.76) | (0.09) | (0.06) | (0.06) | 0.20 | (0.11) | (0.15) | (0.09) | (1.02) | (0.15) | (1.34) |
Net loss income per share (in dollars per share) | $ (0.76) | $ (0.02) | $ (0.13) | $ (0.26) | $ 0.37 | $ 0.11 | $ (0.33) | $ (0.30) | $ (1.21) | $ (0.14) | $ (2.46) |
Weighted average number of common shares outstanding: | |||||||||||
Basic (in shares) | 23,514,000 | 23,499,000 | 23,448,000 | 23,351,000 | 23,247,000 | 23,230,000 | 23,132,000 | 23,056,000 | 23,453,427 | 23,166,977 | 22,814,105 |
Diluted (in shares) | 24,602,000 | 24,680,000 | 23,448,000 | 23,351,000 | 23,347,000 | 23,270,000 | 23,132,000 | 23,056,000 | 23,453,427 | 23,227,138 | 22,814,105 |
DIVIDENDS (Details) |
12 Months Ended |
---|---|
Dec. 31, 2014
$ / shares
| |
DIVIDENDS [Abstract] | |
Cash dividend declared (in dollars per share) | $ 0.18 |
Schedule II-Valuation and Qualifying Accounts (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Movement in Valuation Allowances and Reserves [Abstract] | |||
Balance at Beginning of Period | $ 14,074 | $ 14,849 | $ 14,769 |
Charged to Expense | 14,592 | 13,583 | 15,500 |
Accounts Written-off | (13,872) | (14,358) | (15,420) |
Balance at End of Period | $ 14,794 | $ 14,074 | $ 14,849 |
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